Final answer:
The answer to the entity that pools loans from approved financial intermediaries into securities as mortgage-backed instruments but does not buy or sell loans is Ginnie Mae (d). The correct option is d.
Step-by-step explanation:
The entity established in 1968 as the Government National Mortgage Association, which split from Fannie Mae and which pools loans from approved financial intermediaries into securities, issuing them as mortgage-backed instruments, is Ginnie Mae (d).
Ginnie Mae doesn't buy or sell loans but engages in the securitization of mortgage loans, which means that it takes the mortgages provided by lenders and pools them into mortgage-backed securities (MBS) that investors can buy.
The process of securitization allows lenders to off-load the risk of the mortgages and provides a steady income stream to investors, assuming the loans are repaid.
This model of securitization was seen as a way to spread the risk of mortgage loans across a wider base, which became commonplace after changes in finance and banking laws allowed for easier securitization practices.
Such practices played a central role in the lead up to the financial crisis when the risks turned out to be greater than anticipated. The correct option is d.