Replies to post #757818 on Fannie Mae-No Politics (FNMA)

[Wise Man]

The SPS were fully repaid at the end of 2013 in Freddie Mac (watch my signature image below) and end of 2014 in Fannie Mae, according to the exception B to the restriction on Capital Distributions in the FHEFFSA.

First of all, you have to learn what a capital distribution is.

Then, what a dividend is: a distribution of earnings out of legally available funds. None with deficit in the Retained Earnings account all along.
So, the 10% and NWS dividends weren't actual dividend payments but capital distributions.

By the way, the recent SPS increased for free since December 2017 as compensation to UST, are a capital distribution too. Restricted.
Like all other restricted capital distributions, we apply them towards the exceptions. In this case, for the Recapitalization (CFR1237.12). That is, the Common Equity is held in escrow. When these SPS are cancelled, the Retained Earnings is back up (no need to cancel them, as these gifted SPS are missing on the balance sheets)

[positiveonstocks101]

Don’t both parties have to agree for extension? Is it a one sided decision? Can FHFA conservator choose not to extend?