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Mortgage Mayhem Hits Broker ED&F With Mounting Margin Calls

  • ED&F Man Capital margin calls tied to souring mortgage hedges
  • MBSCC sees ‘significantly higher’ margin calls across industry

Photographer: Jacob Kepler/Bloomberg

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The aftershocks of a chaotic rush to offload mortgage bonds are spilling over to regional broker-dealers facing mounting margin calls.

ED&F Man Capital Markets Inc. has been hit with growing demands to post more capital to cover souring hedges in its mortgage division, according to people with knowledge of the matter. The requests are coming from central clearinghouses and exchanges, forcing the firm to put up almost $100 million on Friday alone, the people said, asking not to be identified because the information isn’t public.