Make Kitco Your Homepage

Fannie, Freddie regulator looks to end government control before Trump's exit: WSJ

Kitco News

(Reuters) - Fannie Mae and Freddie Mac’s regulator is pushing to speed up their exit from government control, but is yet to reach an agreement with Treasury Secretary Steven Mnuchin, the Wall Street Journal reported, citing people familiar with the matter.

U.S. housing finance regulator Mark Calabria is focused on the exit plan for the home mortgage companies, but completing the procedure before U.S. President Donald Trump's term ends on Jan. 20 is a long shot, and President-elect Joe Biden will most likely not continue the effort, according to the report. (

The Federal Housing Finance Agency (FHFA) did not immediately respond to a Reuters request for comment.

Mnuchin is “supportive of locking in a path to private ownership”, but mindful of steps that could disrupt the housing-finance market, the report said, citing one person familiar with the effort.

It also said Mnuchin must agree to any move to alter the terms of either Fannie Mae and Freddie Mac’s bailout agreement or the government’s stakes.

The companies have operated under government conservatorship since they were bailed out during the 2008 subprime mortgage crisis. But for years now, Washington has struggled to devise a plan to safely return the guarantors of over half of the nation’s mortgages to the private sector.

Calabria has outlined an ambitious course for removing the two firms from government control, which includes reviewing their business activities, shoring up their accounting, and raising billions in capital.

FHFA has finalized a capital rule for the pair that will require them to raise more than $200 billion.

Reporting by Noor Zainab Hussain in Bengaluru and Michelle Price in Washington; Editing by Shinjini Ganguli

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.