Milbank has won a one-year, $3 million contract from the FHFA to provide legal services related to ending the conservatorships.

The $13 million Milbank contract, which follows the agency’s February selection of Houlihan Lokey as its capital markets advisor, suggests the FHFA remains committed to recap-and-release.

In a contract worth up to $45 million over four years, the M&A specialist will help FHFA develop “a roadmap to responsibly end the conservatorships” of Fannie Mae and Freddie Mac.

Hiring of a financial advisor marks a significant milestone toward ending the conservatorships of the GSEs, says FHFA Director Mark Calabria.

The agency has picked Houlihan Lokey Capital to help it identify any financial, regulatory or market risks in its path to take Fannie Mae and Freddie Mac out of conservatorship.

Analysts ponder whether the administration is committed to making key reforms to the GSEs in the midst of an election year.

Because it controls the senior class of stock in Fannie and Freddie, the Treasury is in the driver’s seat on recap and release. Former Freddie CEO Layton weighs the government’s options, using AIG as a blueprint.

The FHFA director said Fannie Mae and Freddie Mac may fully exit conservatorship as early as 2022. Meanwhile, on FHLBank membership to non-banks, Calabria said the agency will soon be putting out a request for information.

FHFA Director Mark Calabria said to exit conservatorship Fannie Mae and Freddie Mac will have to be adequately capitalized and make appropriate changes to their culture.

Freddie Mac CEO David Brickman said the GSE has changed, exponentially, in its ability to understand and analyze risk.