FnF's core capital right now is -$170B. Calabria's leverage capital standard (that can only be met with core capital) is $152B, with a $91B buffer on top of that to allow FnF to not be restricted on capital distributions.
That's a $322B gap between current and base. Converting the seniors to common adds $193B, still leaving a $129B gap.
Now, the only way the court cases get settled in the seniors-converted scenario is if Treasury fully unwinds the NWS, which involves sending FnF $125B in cash and ending the NWS once and for all. These two things would moot all lawsuits other than WF.
Tack on the senior conversion and FnF really are fully capitalized, it turns out.
Of course, since the seniors have a liquidation preference of $210B and the current common market cap isn't even $4B, the converted seniors would be at least 98% of the total share count. Treasury cannot hold that large a stake without having to consolidate FnF's balance sheets onto their own, and they wouldn't want to hold all those shares anyway.
Thus new investors are needed after all, in order to buy Treasury's shares and allow Treasury to (more than) offset the $125B they would have paid out.
So that might not technically be an equity raise or re-IPO, but it is one in essence.
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