Fannie Mae-No Politics (FNMA)

[DaJester]

It's in the 4th Amendment to the SPS Agreement, dated 04/13/2021.
https://www.fhfa.gov/Conservatorship/Documents/Senior-Preferred-Stock-Agree/FNM/SPSPA-amends/FNM-Fourth-Amended-Restated-Certificate-04-13-21.pdf

"For each Dividend Period after the Capital Reserve End Date (as defined in the Preferred Stock Purchase Agreement, as amended), “Dividend Amount” means an amount equal to the lesser of 10.0 percent per annum on the then-current Liquidation Preference and a quarterly amount equal to the increase in the Net Worth Amount, if any, during the immediately prior fiscal quarter"

So once we reach the capital threshold, the GSEs will need to pay the lessor of 10% of the $300B+ SPS liquidation preference (and still growing with every retained dollar), or their entire net worth. Unless the GSEs are clearing over $30B in profit, the sweep continues.

When people say "the NWS ended" they are grossly over-simplifying the situation. The CASH NWS ended, instead replaced with a dollar for dollar increase in the SPS LP (an IOU essentially), which will be the basis for future dividends.

IMO - This will still be a violation of the good faith and fair dealing of the shareholder agreement now that we have the jury victory officially entered, and barring any successful appeal.