Though the two government-sponsored enterprises that are the subjects of regulatory reform legislation are confident that current roadblocks will be cleared and the measure passed, the fact is that many directives contained in the bill already are being followed.

We've already raised capital that will meet the new standards and we've set up an affordable housing advisory council that would be required by the bill," said Barbara Fox, director of Senate relations for the Federal Home Loan Mortgage Corporation.

Indeed, a preferred stock issuance in April raised about $500 million, leaving Freddie Mac in a position to meet the fully phased-in minimum capital standard by about $300 million.

A special transitional rule had been included in the legislation that will permit Freddie Mac more time to meet the minimum capital standards, but it apparently will not be needed. The Federal National Mortgage Association also is well over the standards imposed in the legislation.

Both Fannie Mae and Freddie Mac have set in motion plans to meet the affordable housing requirements of the legislation.

The regulatory reform package has been passed by both houses of Congress, but is tied up in the House because of a parliamentary maneuver by Sen. Phil Gramm, R-Texas.

Because he opposed an unrelated amendment that would reduce the chances for general partners to take advantage of limited partners, the Senate was forced to pass its version of the legislation separately and not as a substitute for the House version. The latter would have permitted a House-Senate conference on the differing bills.

Both Fox and William R. Maloni, vice president for policy and public affairs at Fanie Mae, expressed optimism that the impasse can be breached and legislation approved in the waning days of the 102nd Congress.

"The biggest thing we'll have when it's passed will be a risk-based capital system that should convince even the greatest skeptics that a collapse like the savings and loan debacle will never take place with these two corporations." Maloni said.

Neither Fox nor Maloni would speculate about what would happen if matters were held over until next year, when there will be a record turnover of membership in the House and several new faces in the Senate.

"But when you consider the coalition behind the legislation, you have to be optimistic." said Fox. In addition to the GSEs, the legislation has been strongly backed by financial institution trade associations, affordable housing activist and virtually all of the other players in the secondary mortgage industry.

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