Fannie Mae (FNMA)

[Robert from yahoo bd]

TH today on ERCF and the MBA'S public comments: "Towards the end of its comment, the MBA reveals how it’s thinking about Fannie and Freddie’s capital when it says, “In the longer term, MBA recommends FHFA consider further revisions to the ERCF to improve effectiveness and transparency, pending the finalization of the proposed Basel III rule in the US. That rule is expected to impose a 15 to 20 percent increase in capital requirements for larger institutions, and MBA strongly opposes the proposal…Revising the ERCF post-Basel III finalization will give FHFA the opportunity to address compatibility, provide transparency, and lower complexity, which will allow the Enterprises to more accurately and effectively determine capital requirements based on actual risk.” In other words, the MBA still wants FHFA to set Fannie and Freddie’s capital with respect to bank capital requirements, even though there is no economic reason for it to do so. Fixing the ERCF for the benefit of homebuyers, rather than banks, will have to be done over the objections of the MBA."