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Inside The GSEs

July 15, 2009

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GSEs Set Lofty Marks for Mortgage Business

Fannie Mae and Freddie Mac continued to dominate the surging single-family mortgage market during the second quarter of 2009, even as the GSEs set tough standards for loan quality that are increasingly drawing criticism. Together, Fannie and Freddie accounted for a whopping 77 percent of new mortgage securitization activity during the second quarter of 2009, up from... [Includes one chart] Read More

FHLB Seattle Advances, But Hurdles Remain

The Federal Home Loan Bank of Seattle is making noticeable progress to improve its overall position in response to the continued struggles in the mortgage market, but significant challenges remain, according to a recent upgrade announcement from Standard & Poor’s Ratings Service. Chief among the risks are member concentration risk and continued high exposure to non-agency... Read More

Refi Plans Expanded, But How Many Will be Helped?

Fannie Mae and Freddie Mac recently expanded the reach of their refinance programs in support of the Obama administration’s homeowner rescue package, but questions remain over just how many borrowers will be helped by the time the dust settles. Under the recently announced changes, Fannie and Freddie will buy refinance mortgages with loan-to-value ratios up to 125 percent, versus the... Read More

FHFA Maximizes its Leeway on Prior Approval

The Federal Housing Finance Agency last week adopted an interim final rule on the prior approval of new business activities of Fannie Mae and Freddie Mac that gives the agency a substantial amount of latitude. The timing of the final rule, coming one day after the announcement of the expanded GSE refinance programs, conveniently sidesteps the public comment requirement that would... Read More

FHFA Still Developing GSE Risk-Based Capital Reg

The Federal Housing Finance Agency is still preparing for a post-conservatorship future for Fannie Mae and Freddie Mac, as it continues to work on a new risk-based capital standard for the two enterprises that may be tapped for the Federal Home Loan Banks as well. “The development of FHFA’s new risk-based capital standard is a multi-year project which will result in a regulatory economic... Read More

FHFA Aligns its Golden Parachute Reg With FDIC

The Federal Housing Finance Agency recently issued a proposed amendment to the final regulation on “golden parachute” payments it promulgated in January. The revisions are designed to align more closely with the stance of the Federal Deposit Insurance Corp., after considering some of the comments the agency received from Fannie Mae, Freddie Mac and the Federal Home Loan Banks on its... Read More

FHFA Plans to Establish 3 Systems of Records

The Federal Housing Finance Agency continued to crank out regulatory proposals as it moves to implement is authorities under the Housing and Economic Recovery Act of 2008, announcing its intention to establish and maintain three new systems of records as per the Privacy Act of 1974. The first proposed system, “FHFA – 1 Federal Home Loan Bank System Directory,” will contain contact... Read More

House GOPers Fault GSEs’ Binge on Junk Mortgages

Republican members of the House Committee on Oversight and Government Reform have issued a critique of the global financial crisis of 2008 and found much to criticize Fannie Mae and Freddie Mac for, including their “binge” on “junk” mortgages. Citing data provided to the committee, the GOP members of the panel said Fannie and Freddie purchased $1.9 trillion of mortgages made to... Read More

Fair Value May Add Trillions to GSEs’ Balance Sheets

When Fannie Mae and Freddie Mac decide to adopt the revised accounting guidance on fair value, it could result in a combined $3.6 trillion worth of mortgage-backed securities guarantees onto the pair’s balance sheets, which would have demanded an additional $79 billion in regulatory capital under their pre-conservatorship regulatory regime. The guidance from the... Read More

News In Brief

S&P Upgrades FHLB Chicago: In a sign that the Federal Home Loan Bank of Chicago is making... Charles Haldeman Slated to be Freddie’s Next Chief Executive: Charles Haldeman recently resigned... Freddie Offers to Buy Back As Much as $4.4 Billion in Notes: Freddie Mac has offered to repurchase up... Read More

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