{"id":154909,"date":"2021-01-15T03:04:39","date_gmt":"2021-01-15T00:04:39","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/fannie-mae-freddie-mac-can-keep-future-earnings-per-agreement-between-treasury-and-regulators\/"},"modified":"2021-01-15T03:04:39","modified_gmt":"2021-01-15T00:04:39","slug":"fannie-mae-freddie-mac-can-keep-future-earnings-per-agreement-between-treasury-and-regulators","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/fannie-mae-freddie-mac-can-keep-future-earnings-per-agreement-between-treasury-and-regulators\/","title":{"rendered":"#\n  Fannie Mae, Freddie Mac can keep future earnings, per agreement between Treasury and regulators"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a36dc4c47fc8\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a36dc4c47fc8\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/fannie-mae-freddie-mac-can-keep-future-earnings-per-agreement-between-treasury-and-regulators\/#%E2%80%98Until_the_Enterprises_can_raise_private_capital_they_are_at_risk_of_failing_in_the_next_housing_crisis_Federal_Housing_Finance_Agency_Director_Mark_Calabria_said\" >\u2018Until the Enterprises can raise private capital, they are at risk of failing in the next housing crisis,\u2019 Federal Housing Finance Agency Director Mark Calabria said<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/fannie-mae-freddie-mac-can-keep-future-earnings-per-agreement-between-treasury-and-regulators\/#Jacob_Passy\" >Jacob Passy<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  Fannie Mae, Freddie Mac can keep future earnings, per agreement between Treasury and regulators<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"%E2%80%98Until_the_Enterprises_can_raise_private_capital_they_are_at_risk_of_failing_in_the_next_housing_crisis_Federal_Housing_Finance_Agency_Director_Mark_Calabria_said\"><\/span>\n  \u2018Until the Enterprises can raise private capital, they are at risk of failing in the next housing crisis,\u2019 Federal Housing Finance Agency Director Mark Calabria said<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"D055D6D0-56C1-11EB-A1C7-97D14DDC11D2\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       The Federal Housing Finance Agency and the Treasury Department have reached an agreement that will allow Fannie Mae<br \/>\n        FNMA,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/208846331\/delayed\" class=\"\"><\/bg-quote><br \/>\n      \u00a0and Freddie Mac<br \/>\n        FMCC,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/202741363\/delayed\" class=\"negative\">-0.51%<\/bg-quote><br \/>\n      \u00a0to keep their earnings for the foreseeable future.<\/p>\n<p> The FHFA and Treasury <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.fhfa.gov\/Media\/PublicAffairs\/Pages\/FHFA-and-Treasury-Allow-Fannie-Mae-and-Freddie-Mac-to-Continue-to-Retain-Earnings.aspx\" class=\"icon none\">agreed to amend<\/a> the preferred stock purchase agreements for the shares in the two enterprises that the federal government continues to hold following the Great Recession. The amendments will let Fannie and Freddie retain all earnings until they have reached the requirements set by FHFA\u2019s new capital rule issued late last year. <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.fhfa.gov\/SupervisionRegulation\/Rules\/RuleDocuments\/FS-Final-Rule-on-Ent-Capital.pdf\" class=\"icon none\">Under that rule<\/a>, the two mortgage giants would have been required to hold $283 billion in unadjusted total capital as of June 30, 2020, based on their assets at the time.<\/p>\n<div class=\"paywall\">\n       In 2019, the two agencies reached an agreement to let the mortgage giants retain up to $25 billion in earnings. Prior to that, all of Fannie and Freddie\u2019s earnings were swept to the Treasury Department as a dividend to repay the federal government for bailing the enterprises out. <\/p>\n<p>The two enterprises have already almost met the $25 billion in capital they were allowed to retain, necessitating the agreement between FHFA and Treasury, an FHFA official said.<\/p>\n<p>The agreement leaves unaddressed the status of Treasury\u2019s preferred shares and keeps Fannie and Freddie in conservatorship. In the wake of President-elect Joe Biden\u2019s successful presidential campaign, reports emerged that the Trump administration was considering a plan to remove Fannie and Freddie from conservatorship quickly, which would require Treasury\u2019s sign-off. <\/p>\n<p>Lawmakers on both sides of the aisle expressed concerns that a hasty exit from conservatorship could come at taxpayer expense, if it involved Treasury\u2019s writing off the stakes it holds in Fannie and Freddie. Treasury Secretary Steven Mnuchin commented in December that Fannie and Freddie should have \u201c<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ropriate capital\u201d before being privatized.<\/p>\n<p>In announcing the agreement, FHFA Director Mark Calabria said it was \u201ca step in the right direction,\u201d but he cautioned that retained earnings alone would not be enough to get Fannie and Freddie to where they need to be in terms of capital.<\/p>\n<p>\u201cRetained earnings alone are insufficient to adequately capitalize the Enterprises,\u201d Calabria said. \u201cUntil the Enterprises can raise private capital, they are at risk of failing in the next housing crisis.\u201d<\/p>\n<p>Functionally, though, Fannie Mae and Freddie Mac are unable to raise private capital because of Treasury\u2019s preferred shares. Fannie and Freddie shares hold little allure at present to investors, since the conditions of the conservatorship mean they don\u2019t receive a dividend.<\/p>\n<div data-layout=\"\n              inline\" data-layout-mobile=\"\" class=\"\n        media-object\n        type-InsetCommentingPromo\n            \n            inline\n  article__inset\n        article__inset--type-InsetCommentingPromo\n            article__inset--inline\n  \"><\/p><\/div>\n<\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Jacob Passy\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Jacob_Passy\"><\/span>Jacob Passy<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7BD055D6D0-56C1-11EB-A1C7-97D14DDC11D2%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Fannie Mae, Freddie Mac can keep future earnings, per agreement between Treasury and regulators &#8221; \u2018Until the Enterprises can raise private capital, they are at risk of failing in the next housing crisis,\u2019 Federal Housing Finance Agency Director Mark Calabria said The Federal Housing Finance Agency and the Treasury Department have reached an agreement&#8230;<\/p>\n","protected":false},"author":1,"featured_media":154910,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-154909","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/154909","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=154909"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/154909\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/154910"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=154909"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=154909"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=154909"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}