In our most recent in-depth analysis of the challenges confronting FHFA’s capital rewrite, we assessed the complexities inherent in meeting the Administration’s equivalence objective. Now, we turn to some of the GSE-specific questions FHFA must also resolve if its capital rule is not only bank-approximate, but also GSE-appropriate. To resolve them as quickly as Director Calabria contemplates may require splitting the capital framework into a shorter-term one for the conservatorships and a longer-term deep dive based on what the Administration thinks might best befall reprivatized enterprises.
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