Fannie Mae-No Politics (FNMA)

[Wise Man]

"How do we unscramble an egg?"

1- A posting of $236B in their Retained Earnings accounts ($130B/$106B in Fannie Mae /Freddie Mac, respectively),
2- Treasury Stock, retired (Stock buybacks)
3- $151B cash refund from the Treasury (SPS overpayment + CRT, net + PLMBS lawsuit settlement, net of attorney fees)

The lawsuit settlement was split 73% for Freddie Mac and 27%, Fannie Mae, based on a comparison of their AOCI as of June 30, 2008 (Accumulated Unrealized Losses in PLMBS)

This way, the Common Equity coincides with the one calculated by simply taking the one as of June 30, 2008, and adding up the accumulated Total Comprehensive Income increases (no dividend payment) adjusted for 3 Accounting Standard charges during Conservatorship.
Finally, it was added the settlement of the PLMBS lawsuit and the CRT expenses that it's been requested a refund too, net (a deductible expense, now it pays taxes to turn it into Retained Earnings)

After the redemption of the JPS, this is the Equity or Net Worth of a FnF combined, to simplify the analysis:

$0 Common Stock par value
$236B Retained Earnings account, versus today's adjusted $-216B (An account that absorbs future losses and where the dividends are distributed from. It can't have negative balance)
$- small amount of AOCI, as seen today in their balance sheets.

Same chart of a normal Conservatorship and the one with a Separate Account.
Premise: no dividend payment.
Freddie Mac's, below: