FHFA Director Mark Calabria said he expects Fannie Mae and Freddie Mac to retain earnings for up to 18 months as the GSEs work to rebuild capital, according to reports Thursday. He noted that the GSEs could look to raise capital from the markets in 2021, but that it would take time “to build up enough of a cushion, to demonstrate to the markets that there’s earning capacity there.”
Calabria’s remarks followed an announcement of an agreement reached between the GSEs and Treasury to effectively end the “net worth sweep,” a critical step toward removing the enterprises from conservatorship that was outlined earlier this year in the Treasury Department’s housing reform plan.
ADVERTISEMENT
