In September, the FSOC endorsed the FHFA’s capital rule, even urging the agency to use tougher, more bank-like standards. What the report didn’t say was how the council reached its conclusions.

Adolfo Marzol is one of the main architects of the final GSE capital rule.

If the FHFA wants to release the GSEs from conservatorship before President Trump leaves office, it will need a big assist from Treasury. And therein lies the problem.

Under the final rule, Fannie and Freddie will have to hold slightly more than $283 billion in capital. That’s $49 billion more than what FHFA had estimated when it re-proposed the rule in May.

The new rule provides clarity about how much and what kind of capital Fannie and Freddie will need in order to exit conservatorships. But the likelihood of that kind of capital raise seems remote.

Now that the GSE “re-IPO” is presumed to be dead, are Fannie and Freddie facing a brain drain? In short, stock options matter.

Under the new guidelines, at least 50% of the multifamily loans that Fannie and Freddie purchase must be for affordable housing. That’s up from 37.5% under the prior caps.

Could investors sink their money into the GSEs only to have Congress convert them into public utilities and closely supervise their g-fees?

Former MBA president David Stevens believes the adverse market fee has nothing to do with COVID-induced risk. “It’s about building up the capital of Fannie and Freddie,” he said.

On the multifamily side of the aisle Fannie purchased 385,763 units in the low-income category. Freddie did even better: 495,451.