Replies to post #610061 on Fannie Mae-No Politics (FNMA)

[kthomp19]

Did Tim Howard suggest that subordinated debt could be used?

I doubt it. The most important capital standard that FnF need to meet is the minimum capital standard, which Calabria has set at $152B. By law this can only include common equity, non-cumulative preferred equity, paid-in capital, and retained earnings. Subordinated debt cannot count.

Any thoughts on COCO debt being part of the capital stack since it is contercyclical?

Same thing: this cannot count towards core capital, so I don't see why these would be part of the recap.

[HoldenWalker99]

COCO could be part of plan to get from $152B (minimum, cor capital only) to $235B (regulatory, total capital).