GSE watchers believe that, to appropriately compensate the taxpayer for their government guarantee, Fannie and Freddie would have to pay a commitment fee as high as $46 billion a year.
Housing finance aficionados like the prospect of a GSE exit from conservatorship that includes the retention of the Treasury’s PSPA, especially if done in conjunction with a sovereign wealth fund.
Three former CEOs of the GSEs this week debated the impact of federal conservatorship, what steps must be taken to safely end the oversight and what the GSEs should look like afterwards.
If the GSEs are released from conservatorship, some participants in the agency MBS market insist the to-be-announced market, uniform MBS and Fannie/Freddie CRT activity should remain untouched.
Treasury Secretary Bessent’s cautious remarks about the prospect for GSE reform heighten industry skepticism about the release of Fannie Mae and Freddie Mac from conservatorship.
The Federal Housing Finance Agency in recent years has done a better job than Ginnie Mae in interagency planning for a hypothetical nonbank crisis, according to the Government Accountability Office.
The creation of a U.S. sovereign wealth fund could grease the skids for an end to the conservatorships of Fannie Mae and Freddie Mac.
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