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Volume 17 - Number 23

November 17, 2017

Tax Reform Plan Puts GSEs a Step Closer to Potential Treasury Draw

With the Senate and the House having both recently released their tax proposals, itís the House plan to cut corporate taxes in 2018 that would impact the GSEs by threatening their deferred tax assets. A corporate tax cut would likely force Fannie Mae and Freddie Mac to take draws from the U.S. Treasury. This is especially true in light of the fact that by Jan. 1, 2018, neither GSE will be allowed to hold a capital buffer to absorb any losses. A cut to corporate taxes means a write down of some Fannie/Freddie DTAs, including mortgage-related assets, allowances for bad loans, derivatives-related basis differences and deferred fees, which are all currently held at a higher tax rate.

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What’s your opinion on how Mick Mulvaney has managed the CFPB since he took over three months ago?

He’s done a good job of paring back the agency’s excesses and we’d like to see more.
I hope he totally dismantles the agency and sends those functions back to the agencies hence they came.
Not bad, but he needs to take his time making additional changes.
We’re totally aghast. He’s gone way too far in protecting the rights of companies not consumers!

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