Senate Republicans have threatened to block the confirmation of Carol Galante as head of the FHA until Senate Democrats come up with a plan to deal with Fannie Mae and Freddie Mac. The Senate Committee on Banking, Housing and Urban Affairs this week voted 13 to 9 to send Galantes nomination to the Senate floor amid Republican calls to reject the nomination. Some Republicans expressed concern over the health of the FHA Mutual Mortgage Insurance Fund, citing a recent independent actuarial study that reported a precarious drop in the funds excess capital reserve for unexpected losses. Sen. Jim DeMint, R-SC, said he did not think ...
Ginnie Mae may not be accurately disclosing its financial exposures to Congress because it is not fully implementing federal accounting guidance and using critical information, according to a recent report by the Government Accountability Office. GAO auditors found that Ginnie Mae did not stick to federal accounting guidance in developing the inputs and procedures for reporting forecast costs and revenues. Under the Financial Accounting Standards Advisory Board guidance for preparing cost estimates of federal credit programs, reporting entities are required to develop estimates...
Fannie Mae and Freddie Mac would be put into irrevocable receivership with the Federal Housing Finance Agency tasked as their receiver no later than 18 months after enactment of a bill introduced in the Senate this week.Sen. Johnny Isakson, R-GA, introduced the Mortgage Finance Act of 2011 to get the American taxpayer out of the business of bailing out the mortgage industry. The bill would wind down Fannie and Freddie while creating a new regulatory framework for high-quality mortgage securitization for both single-family and multifamily mortgages.
The Federal Housing Finance Agency needs to be much more hands-on and engaged in its oversight of Fannie Mae and Freddie Mac, according to the Finance Agencys official watchdog.The FHFA Office of Inspector Generals conclusion is not new, but the OIG doubled down on its criticism of the agency last week both in its Semiannual Report to Congress and in written testimony submitted to the House Financial Services Subcommittee on Oversight and Investigations.
The Federal Housing Finance Agency last week announced two new outside hires to fill the slots of chief operating officer and the agencys deputy director of division enterprise regulation.As the FHFAs COO, Richard Hornsby will be responsible for the strategic management of the agencys operations and will oversee the FHFAs administrative and support services, including budget and finance, human resources and information technology.
The governments effort to develop and implement a plan for bulk sales of inventory of government-owned foreclosed properties is slowly gaining form and substance, according to the summary of suggestions released by the Federal Housing Finance Agency released last week.In August, the FHFA, along with the Treasury Department and the Department of Housing and Urban Development, issued a request for information seeking input for new options for selling single family REO held by Fannie Mae, Freddie Mac and the FHA.
A proposed radical shift in how lenders are paid for servicing Fannie Mae and Freddie Mac mortgages would make the business less feasible and skew the competitive landscape even more than it is, according to the Mortgage Bankers Association. In a comment letter to the Federal Housing Finance Agency, the MBA said the regulator and the two government-sponsored enterprises ought to shelve their controversial plan to reform servicing compensation. The FHFA and the GSEs have focused on two alternatives: a fee-for-service model favored by the agencies, and an industry proposal to reduce the...
Commercial banks will have to do more than just look at the credit rating on a security before deciding it qualifies as a potential investment under a proposed rule issued by the Office of the Comptroller of the Currency this week. The Federal Deposit Insurance Corp. is scheduled to consider a similar proposal next week. Under marching orders from the Dodd-Frank Act, bank regulators have been removing references to external credit ratings from a variety of regulations even though banks themselves dont agree with the change. Most commenters on earlier proposals from...
The chief of enforcement at the Securities and Exchange Commission took issue with a U.S. District Court judges rejection this week of the agencys proposed $285 million settlement with Citigroup over a collateralized debt obligation backed by MBS that went sour, and defended the deal as the best available course of action, given the restrictions under current law. Robert Khuzami, director of the SECs Division of Enforcement, responded to a ruling announced early this week by U.S. District Court Judge Jed Rakoff in Manhattan in which the judge rejected the multi-million-dollar...
Most bond dealers expect the Federal Reserve to begin buying a substantial volume of MBS in an effort to stimulate an anemic economy, according to the results of a Bloomberg News survey of bond dealers. They project that the Fed could buy as much as $800 billion of MBS in 2012. The Fed would not respond to requests for comment regarding this plan, but the purchasing of MBS may be a part of a new round of quantitative easing for the market. Fed analysts claim that the agencys first big MBS buying binge, between November 2008 and March 2010, helped push mortgage rates...