Fannie Mae-No Politics (FNMA)

[navycmdr]

Picking up a Head of Steam: Congressional Interest in GSE Reform ?

By Brandon Ivey [e-mail]

Calls from Congressional staffers seeking information regarding reform options for the government-sponsored enterprises have increased recently, according to Andrew Davidson, president of Andrew Davidson & Co., an analytics firm.

Speaking Monday at the SFIG Vegas conference produced by Information Management Network and the Structured Finance Industry Group, Davidson said he has received “a surprising number of calls” from congressional staff regarding reform of Fannie Mae and Freddie Mac.

The two mortgage giants, once money-losing behemoths, have been operating under government conservatorship since early September 2008. Although both are now profitable, there has been little movement on finding a workable solution that all parties can agree on.

It’s believed that the prospects for legislative reform increased somewhat with the election of Donald Trump and Republicans maintaining majorities in the House and Senate, but already other priorities are developing: health care reform, tax reform and infrastructure spending. “GSE reform seems hard to fit into the congressional schedule at this point,” Davidson predicted.

Fannie and Freddie, combined, earned $20.2 billion for all of 2016, a 16.1 percent improvement from the year before. It was the fourth best annual profit ever posted by the two.