Our in-depth report yesterday detailed the testimony, Q&A, and outlook following the House Financial Services Committee hearing on housing-finance reform.  Much in it was predictable in terms not only of partisan bickering, but also Administration and FHFA thinking on conservatorship regulation, the receivership option, and FHA risk-based pricing.  However, Director Calabria did shed light on the equivalence test FHFA contemplates for GSE regulatory capital.  If the agency holds to capital aligned to that demanded of U.S. GSIBs, then capital adequacy is a long way off absent a structural realignment along with substantial private-capital contributions.  However, the complexity of U.S. big-bank capital rules also provides considerable opportunity for what we would call equivalence as you like it.

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