(Adds quote, background and byline)

By Julie Haviv

NEW YORK, June 30 (Reuters) - U.S. mortgage-backed securities issuance plunged in the first six months of 2009, compared with the same period a year ago as uncertainty held sway over the housing market and investors shied away from risky instruments, a survey showed on Tuesday.

Thomson Reuters said U.S. mortgage-backed securities issuance totaled $87.5 billion in the first half of 2009, down sharply from $143.2 billion in the same period a year earlier, a drop of 38.9 percent.

The vast majority of new-issue activity came from Fannie Mae, Freddie Mac and Ginnie Mae, but the market began to see a bit of activity in the private-label residential mortgage market in the second quarter, said Matthew Toole, an analyst in the deals group at Thomson Reuters.

"Despite the decrease from 2008 levels, the market for U.S. mortgage-backed securities posted its biggest quarter for new issues since the second quarter of 2008," he said.

Bank of America Corp (BAC.N: Quote, Profile, Research) was the top underwriter of U.S. mortgage-backed securities for the first half of 2009, the survey showed.

Bank of America underwrote 26 issues of mortgage-backed bonds, totaling $20.3 billion, a 23.2 percent market share.

Credit Suisse Group (CSGN.VX: Quote, Profile, Research) ranked second among U.S. MBS underwriters in the first half of 2009, with a 15.3 percent share. The firm underwrote 22 issues worth $13.4 billion.