21 11, 2022


2022-11-21T16:42:15-05:00November 21st, 2022|4- GSE Activity Report|

We’re Starting to See SIFIs

As came out into the open last week, FSOC will finally turn to rewriting the Trump era rewrite of the Obama Administration’s FSOC protocols regarding systemic financial institutions and activities.  Could the SIFI reaper be coming for Fannie and Freddie?  We doubt it, but then again…


21 11, 2022

FedFin: We’re Starting to See SIFIs

2022-11-22T13:21:33-05:00November 21st, 2022|The Vault|

As came out into the open last week, FSOC will finally turn to rewriting the Trump era rewrite of the Obama Administration’s FSOC protocols regarding systemic financial institutions and activities.  Could the SIFI reaper be coming for Fannie and Freddie?  We doubt it, but then again…

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25 10, 2022


2022-10-25T16:56:16-04:00October 25th, 2022|4- GSE Activity Report|

The Great Unbundling

As we noted yesterday, FHFA has decided not only to unbundle second and high-dollar loans from its flat-fee paradigm, but now to do the same for about one in five conventional conforming purchase loans outside these categories.  Together with new cash-out refi fees, the agency is recrafting Fannie and Freddie into an express risk- and mission-pricing construct that alters the essence of the GSEs and thus of the market as a whole.


24 10, 2022


2022-10-24T16:48:00-04:00October 24th, 2022|2- Daily Briefing|

Deadline Set for D-SIB Resolution Comment

The Federal Register today included the Fed/FDIC D-SIB resolution ANPR, as announced last week (see Client Report DEPOSITINSURANCE115).  As analyzed in our in-depth report (see FSM Report RESOLVE48), the agencies seek comment on whether requiring D-SIBs to have TLAC standards akin to those mandated for G-SIBs would enhance resolvability, as well as seeking input on extending clearing holding company requirements to D-SIBs, disclosure standards in the event of a resolution, and explicit severability plans.

FHFA Advances Equitable Finance With New Fees, Credit Score Options

Building on its 2022 scorecards and January’s up-front fee price hikes, FHFA today announced it will eliminate upfront fees – aka, delivery fees or loan-level price adjustments (LLPAs) – for certain borrowers and affordable mortgage products.  The Agency will also implement targeted increases to the upfront fees for most cash-out refinance loans.  Upfront fees will be eliminated for: first time homebuyers at or below 100% of area median income (AMI) and below 120% AMI in high-cost areas; HomeReady and Home Possible loans, which are Fannie and Freddie’s flagship affordable housing products; HFA Advantage and HFA Preferred loans; and single-family loans supporting the Duty to Serve program.


6 10, 2022


2022-10-06T11:10:21-04:00October 6th, 2022|4- GSE Activity Report|

How Low Can You Go?

FHA’s request for input on small-dollar loans could mean much for this equality-essential product or little beyond a lot more public debate.  It was issued concurrently with a high-profile Administration event on racial equity, coming also in concert with a new HUD report on small-balance mortgages (i.e., those with balances of less than $70,000) mandated under an FY22 appropriations measure.  Depending on what it does, HUD could do more for small-dollar loans than FHFA explicitly pressed in its equitable-finance plan, although Fannie and Freddie might come round to crafting some programs in the special-purpose credit programs they anticipate.


4 10, 2022


2022-10-05T10:36:14-04:00October 4th, 2022|2- Daily Briefing|

IMF Calls for Open-End Fund Swing Pricing

The IMF today released a study of open-end funds sure to guide the action promised by SEC Chairman Gensler (see Client Report INVESTOR20).

Fed Study: Climate-Risk Insurance Cross-Subsidies Pose Moral Hazard, Financial Risk

Using homeowners’ insurance as a proxy for climate-risk insurance, a Fed staff study finds that the decoupling of rates and risk raises moral hazard and causes policy-holders in lower-risk and less restrictively regulated states to subsidize those in riskier states, where rates have been outpaced by losses.

Yellen Highlights Need for Crypto Reg at Racial Equity Roundtable

At a Treasury roundtable on racial equity and economic inequality, Treasury Secretary Yellen today reiterated the importance of the cryptoasset standards recommended yesterday by the Financial Stability Oversight Council.

Fed Sets Supervisory Standards for a Non-Traditional IDI Parent

The Federal Register today includes the Federal Reserve’s final supervisory framework for DIHCs controlled by insurance companies.

Final FHLB Listening Session Brings System Praise, Resistance to Change

We will shortly provide clients with an in-depth report on the last session FHFA held today listening to dozens of views on the future of the Federal Home Loan Bank System.


4 10, 2022


2022-10-05T10:38:31-04:00October 4th, 2022|4- GSE Activity Report|

The Sweet Smell of Success?

Although one witness at the FHFA listening session on the Home Loan Banks took strong issue with their mission and meaning, another who called them the “most successful program of the last hundred years” pretty much summed up today’s testimony.


3 10, 2022


2022-10-03T11:11:55-04:00October 3rd, 2022|4- GSE Activity Report|


Our take on the first two days of FHFA’s FHLB “listening session” last week is that battle lines are shaping up much as we expected with the exception of a couple of powerful groups with new ideas about how the System could be put to better use for themselves and/or the public interest.  As noted when these sessions were announced, our strategic thinking centers around what FHFA can do on its own under current law or how far it decides to stretch it.  Key questions and our forecasts for next steps follow.



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