Fannie Mae-No Politics (FNMA)

[Wise Man]

This Restriction on Capital Distributions in the FHEFSSA (U.S.Code §4614(e)), was later supplemented (which means there was intent to carry out a "follow-on plan") and shall not replace or affect it (clause (c) below), with the CFR 1237.12 of the July 20, 2011 Final Rule, when the FHFA director foresaw that, with the coming NWS dividend, the SPS will be fully repaid fast and it was needed another exception to apply the assessments towards: Deplete capital (capital exits the balance sheets) is authorized if it recapitalizes FnF (build capital), which is Separate Account wording right there, through regulation.



Notice that this Final Rule was enacted two weeks before the FHFA announced a proper Recapitalization Plan for the FHLBanks, that is, on-Balance Sheet.
Though, in this press release we see that the FHFA has a huge problem with the financial statements, as alibi for having written a Separate Account (outside their Balance Sheets. Financial Statement fraud) through regulation with FnF.
Separate Retained Earnings account on the Balance Sheet doesn't exist by any stretch of the imagination.
Let alone a Separate Restricted Retained Earnings account.
All forms part of the same pot and the capital requirements are enough restriction to not allow the shareholders to take it away through a special dividend or stock buybacks that deplete it. But you can't write "separate restricted Retained Earnings account". This obsession with "separate accounts" was an alibi for Fanniegate, carried out outside their balance sheet (External Position, Bundesbank-style with the ECB's Payment System Target 2. The FHFA and ECB's Draghi had the same advisor, Goldman Sachs).