Replies to post #758922 on Fannie Mae-No Politics (FNMA)

[LuLeVan]

There is a slight nuance in this but seniors cramming down is NOT a part of the capital raise.

An SPS-into-commons conversion would be a very important factor in the capital raise because it would remove $193 billion from FnF's balance sheet. The same would happen if the SPS were deemed "paid" or deleted as "worthless", but this variant is quite unlikely, even if Tim Howard still believes in it. A capital raise would be impossible if the SPS remained on the balance sheet.