Fannie Mae-No Politics (FNMA)

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Amendments to the Enterprise Regulatory Capital Framework Rule – Prescribed Leverage Buffer Amount and Credit Risk Transfer
Open Date:Open for comment 9/15/2021 Deadline: All comments are due by TBD
Type:Notice of Proposed Rulemaking
Number:RIN-2590-AB17
Group:Fannie Mae; Freddie Mac
CFR:12 CFR Part 1240
CFR Description:Part 1240—CAPITAL ADEQUACY OF ENTERPRISES
Federal Register Publish Date:9/15/2021
Specifically, the proposed rule would:

Replace the fixed PLBA equal to 1.5 percent of an Enterprise’s adjusted total assets with a dynamic PLBA equal to 50 percent of the Enterprise’s stability capital buffer as calculated in accordance with 12 CFR 1240.400;
Replace the prudential floor of 10 percent on the risk weight assigned to any retained CRT exposure with a prudential floor of 5 percent on the risk weight assigned to any retained CRT exposure; and
Remove the requirement that an Enterprise must apply an overall effectiveness adjustment to its retained CRT exposures in accordance with the ERCF’s securitization framework in 12 CFR 1240.44(f) and (i).

https://www.fhfa.gov/SupervisionRegulation/Rules/Pages/Amendments-to-the-Enterprise-Regulatory-Capital-Framework-Rule-%E2%80%93-Prescribed-Leverage-Buffer-Amount-and-Credit-Risk-Transfer.aspx?utm_medium=email&utm_source=govdelivery





?SUMMARY: The Federal Housing Finance Agency (FHFA or the Agency) is seeking comments on a notice of proposed rulemaking (proposed rule) that would amend the Enterprise Regulatory Capital Framework (ERCF) by refining the prescribed leverage buffer amount (PLBA or leverage buffer) and credit risk transfer (CRT) securitization framework for the Federal National Mortgage Association (Fannie Mae and Freddie Mac) and the Federal Home Loan Mortgage Corporation (Fannie Mae and Freddie Mac each an Enterprise). The proposed rule would also make technical corrections to various provisions of the ERCF that was published on December 17, 2020.

DATES: Comments must be received on or before 60 days after publication in the Federal Register.