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Inside The GSEs

April 22, 2009

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Who’s Running the GSEs, and How Well?

With the departure of Freddie Mac’s former CEO David Moffett in March, and Fannie Mae CEO Herb Allison now heading out the door to head up the Treasury Department’s Troubled Asset Relief Program, GSE supporters and critics alike are increasingly concerned about executive turnover and the management of the companies under the federal government’s conservatorship. Since being placed... Read More

Boston: Credit Losses Still Must be Faced

The market value accounting-induced flow of red ink from a handful of the Federal Home Loan Banks may be leveling off, thanks to the concessions recently granted by the Financial Accounting Standards Board. However, the Banks are still going to have to face their actual credit losses, and FASB’s solutions won’t make that eventuality disappear. That’s perhaps the most important... Read More

GSEs Hold the Line on Pricing, New Goals in the Works

Fannie Mae and Freddie Mac officials said they are keeping their guarantee fee pricing as low as possible in difficult market conditions, as they try to meet a public mission that has shifted toward a greater focus on sustaining homeownership. “We’re pricing for the risk we’re taking and keeping guarantee fees as low as possible to ensure we are around for the future,” said Donald... Read More

GSEs Work Closely With MIs to Support Obama Plan

Fannie Mae, Freddie Mac and their private mortgage insurer partners are increasing their cooperation in support of two aspects of the Obama administration’s housing rescue plan, the Home Affordable Refinance Initiative and the Home Affordable Modification Program. One big challenge for the mortgage insurers is the hit they face from extending existing MI coverage on... Read More

Is Sallie Mae a Viable Model for Converting the GSEs?

As lawmakers prepare a push to reconstitute Fannie Mae and Freddie Mac later this year, ideas about how best to restructure the pair are gaining renewed consideration. Some of the options being debated include merging the two, spinning them off completely from the federal government, or breaking them up according to their business units and selling them to private investors or stockholders... Read More

FHLBanks Have 4Q Loss, But Profit for Full Year ‘08

As Inside The GSEs was going to press, the FHLBank Office of Finance released its combined financial report for the 12 Federal Home Loan Banks, reporting a collective loss of $715 million for the fourth quarter, versus combined net income of $846 million for the same period the year before. However, the Banks still were able to show a profit for full-year 2008, reporting a collective... Read More

U.S. Investment in GSE MBS, Debt Nears $600 Billion

The Federal Reserve pumped another $113.33 billion of liquidity into the U.S. residential mortgage market in the last two weeks, including $109.28 billion in support of Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks. Of that, $101.06 billion came in purchases of Fannie and Freddie mortgage-backed securities. Most of that, $78.11 billion, went to Fannie MBS, while Freddie... Read More

FHLBank Discount Note Issuance Exits Stratosphere

Discount note issuance by the Federal Home Loan Banks came back to earth in the first quarter of the year, after an eye-popping, record-setting performance in 2008 when the Banks collectively blew past 2007’s high water mark of activity by more than $1 trillion. According to the latest analysis by Inside The GSEs of quarterly discount note issuance data from... [Includes one chart] Read More

News In Brief

Fannie CEO Allison Moves to TARP; COO Williams Succeeds Him... New Fannie Web Site to Help Servicers Participate in HAMP... Parseghian Nomination to PHH Board Hits Resistance... Freddie’s Acting CFO Found Dead in an Apparent Suicide... Insurer FHLB Membership Keeps Inching Upward... Read More

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