GSEs

Mark Calabria, who oversaw the two government giants under Trump and was fired by the Biden administration, said in a recent interview that the government-sponsored enterprises are once again at risk of insolvency.

In an open letter to Sandra L. Thompson, President Biden’s nominee for director of the Federal Housing Finance Agency, two longtime advocates of the Federal Home Loan banks suggest a new path forward.

Chryssa Halley, who has been with the company since 2006, was named CFO and Jim Holmberg was named controller.

Demand for advances from the Home Loan banks has plummeted as the Federal Reserve has flooded the financial system with liquidity. But with a nudge from Congress, these government-sponsored enterprises could remain relevant by broadening their mission and opening membership to more lenders.

The Federal Housing Finance Agency in the Trump administration had been preoccupied with Fannie Mae and Freddie Mac’s capital position. Acting Director Sandra Thompson has shifted the agency’s focus to affordable housing and fair lending.

This year's assessment for Fannie Mae and Freddie Mac is the first to take into account a January agreement between the Federal Housing Finance Agency and the Treasury Department that allowed the companies to retain more earnings.

A hike in guarantee fees charged to lenders for the companies’ backing of loans was due to expire this year, but lawmakers now want to extend it to raise $21 billion for the bipartisan package.

The guarantor has for the first time proposed a risk-based capital requirement for companies not subject to other federal regulation. The industry says the plan, which would impose a heavy charge for servicing portfolios, could drive lenders away from government-backed programs.

The plan aims to cut monthly payments by roughly 25% for homeowners in government-backed mortgages who are negatively impacted by the pandemic.

The agency’s new chief said eliminating the “adverse market fee” — in place since December — will make it easier for families to refinance while mortgage rates are still low.