If Fannie capital had been at mandated levels, the enterprise would have had an annualized ROE of 10.3% in the third quarter.

The Trump administration plans to reduce certain capital requirements to encourage bank involvement in the mortgage market, according to Treasury Secretary Scott Bessent.

Like most GSE reform plans, the hedge funder’s plan to privatize Fannie and Freddie starts with Treasury writing down its senior preferred shares and FHFA sharply reducing the capital requirements for the GSEs.

The hedge fund billionaire predicts Treasury will write off its senior preferred shares in the GSEs and exercise its warrants for 80% of their common stock.

Housing finance aficionados may doubt Fannie and Freddie will ever exit conservatorship, but that doesn’t stop them from telling you what that exit would look like.

Second-quarter acquisitions increased at the government-sponsored enterprises, but profits remained stable as credit reserves shifted.

While many mortgage industry stakeholders want the GSEs’ current capital rule to be changed, others believe it’s a good compromise.

The former FHFA director claims that Wall Street critics worried his policies would cut into their profits.

The new rule should please critics of the fee for commingled securities.

Loss provisions and declining volumes spell lower profits going forward. However, Fannie’s capital requirements remain elevated.