Managing HFAs’ Financial Health in the Face of UncertaintyNCSHA Annual Conference

October 21, 2014Ping Hsieh, Vice President – Senior Analyst

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Rebounding from the Financial Crisis

• Positive trend continues with strong financial matrices amid deleveraging

• Better positioned to address variable rate risks

• More diversified business model

• Profitability is central to our credit analysis but Mortgage Interest Income to General Expense Ratio is also important

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Profitability and Equity Are Growing

Source: Moody’s adjusted audited state HFA financial statements

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HFAs Are Better Positioned To Address Potential Variable Rate Challenges

Source: HFA Surveys

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Increasing Spread Between Mortgage Income and Bond Costs Increases Profitability

Source: Moody’s adjusted audited state HFA financial statements

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Mortgage Funding Shifted From Bonds To TBA

Source: HFA Surveys

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Coverage of G&A Expenses by Mortgage Loan Revenues is Declining

Source: Moody’s adjusted audited state HFA financial statements

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Ping HsiehVice President – Senior Analyst ping.hsieh@moodys.com (212) 553-4461

Florence ZemanAssociate Managing Director florence.zeman@moodys.com(212) 553-4836

Kendra SmithManaging Director kendra.smith@moodys.com (212) 553-4807

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