Fannie Mae (FNMA)

[navycmdr]

Shelby's Bill Would Alter the Common Securitization Platform

By Paul Muolo [e-mail]

The common securitization platform of Fannie Mae and Freddie Mac would be turned into a nonprofit entity that would be prohibited from placing any type of guaranty on mortgages or mortgage securities under a new regulatory relief bill from Sen. Richard Shelby, R-AL, chairman of the Senate Banking Committee.

The CSP ? a project housed within a Fannie/Freddie joint venture called Common Securitization Solutions ? would become a structure ?that best facilitates a deep, liquid and resilient secondary mortgage market for mortgage-backed securities,? according to a draft of the bill.

Headquartered in Bethesda, MD, CSS is working on developing a common security that can be issued by the GSEs along with the infrastructure and technology to support such an endeavor.
To date, CSS has yet to perform a beta test and has a ?black budget? whose details are known only to Fannie, Freddie and their regulator. For more details, see the Friday edition of Inside MBS & ABS.