Their new Senate majority, albeit a slim one, should make it easier for Democrats to pass key budget priorities. But what does it mean for Fannie and Freddie?

New multifamily caps, announced in November, also included changes to the definition of “mission-driven.”

FHFA said the plan to have “living wills” is akin to what the Federal Reserve and the FDIC require for their bank charges.

Treasury Secretary Steven Mnuchin said he is “not going to do anything that jeopardizes taxpayers.” But his real concerns? How to adequately capitalize Fannie and Freddie first.

The FHFA wants the GSEs to hold liquid assets to cover 30 days of anticipated cash outflows, plus a $10 billion buffer. That’s similar to the liquidity coverage ratio employed by bank regulators.

Justice Breyer characterized the net worth sweep as the nationalization of the GSEs. The government and the court-appointed amicus curiae disagreed, describing it as a simple renegotiation of a contract.

Treasury Secretary Steven Mnuchin suggested in a Senate hearing that Fannie and Freddie may not have enough capital to exit conservatorship before Trump leaves office.

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.