More MBS in the retained mortgage portfolios of the GSEs boosts net interest income, but adds to their capital costs and duration risk. (Includes data table.)

Critics say that the high level of the GSEs’ profits is the result of pricing based on inflated loss-risk assumptions.

The OIG said budget cuts and FHFA’s refusal to cooperate obstructed its investigations into the GSEs’ multifamily operations.

Several changes to Fannie's attorney fees exhibits will kick in on Jan. 1.

FHFA gave Fannie Mae high marks for its performance in the duty-to-serve market for manufactured housing even though Fannie missed all four of its target objectives.

Budget cuts will eliminate “OIG’s capacity to identify, investigate and develop the evidence necessary to prosecute fraud schemes involving the multifamily mortgage market,” said Acting Principal Deputy Inspector General James Hodge.

Although Fannie Mae and Freddie Mac still face enormous capital shortfalls, retained earnings are beginning to make a mark. (Includes one data table.)

Industry observers lament the lack of teeth in the executive order, which leaves most key policy decisions to the FHFA director.

James Hodge, acting inspector general for FHFA, reiterated that budget cuts will make it impossible for the watchdog to fulfill its statutory duties.

Although Treasury Secretary Scott Bessent said the Trump administration could deal with a possible release of the GSEs before its term ends, he hinted that he didn’t see the point.