Tabs

Bank/Thrift Supervision   |    Capital    |    CFPB    |    Deposit Insurance    |    Interchange    |    Mortgage Finance
Municipal Advisors   |    OCC-OTS Merger   |    Preemption    |    QM - QRM    |    Swaps   |    Volcker Rule    |    Full Topics List
 
Qualified Mortgage - Qualified Residential Mortgage
Swaps
Consumer Financial Protection Bureau - CFPB
Bank/Thrift Holding Company Supervision
Capital
Deposit Insurance
Interchange
Mortgage Finance
Municipal Advisors
OCC-OTS Merger
Preemption
Volcker Rule
Corporate Governance
Financial Stability Oversight Council (FSOC)
Appraisals
Office of Financial Research (OFR)
Systemic Risk
Supervision and Oversight
Payment, Clearing and Settlement
Prudential Supervision
Trust & Securities
Asset-Backed Securities
Resolution Authority

Monday, August 20, 2012

Treasury Accelerates GSE Wind-Down

The Treasury Department on Friday modified its financial support of Fannie Mae and Freddie Mac to accelerate the winding down of the government-sponsored enterprises.

The GSEs will no longer pay a 10 percent annual dividend to Treasury on its preferred stock investments in Freddie and Fannie. Instead, they will give Treasury all of their profits, agency officials said. The GSEs also will reduce their investment portfolios at a 15-percent annual rate, rather than 10 percent per year. As a result, the GSEs’ investment portfolios would reach the $250 billion goal in 2018, four years earlier than originally scheduled.

ABA applauded Treasury’s steps in a statement from Frank Keating:
[The] changes are consistent with [the Federal Housing Finance Agency’s] strategic plan and ABA’s reform priority of a reduced government presence in the housing market.

The taxpayers’ investment in the GSEs was essential to stabilizing the housing market and laying the foundation for recovery,” he said. “Much more work needs to be done to reform the secondary market, but [Treasury’s] announcement helps move this process forward and ensure the taxpayers’ investment is ultimately repaid.

Read Treasury's announcement.
Read Keating's statement.
Read ABA's GSE reform principles.

No comments:

Post a Comment

Please read our comment policy before making a comment.