FHFA has submitted its Performance and Accountability Report for FY 2010 showing little progress in achieving safety and soundness goals set for the GSEs or the Bank System.  FHFA again directs the Banks to expand their advance business and shrink their portfolios, keeping the pressure on the System despite tough times in the mortgage arena.  FHFA highlights growing interest-rate risk on the GSEs’ newly-illiquid retained portfolios – an important reminder that the GSEs’ woes aren’t confined to credit risk.

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