There is a "wide and sophisticated pool" of mortgage investors who could pick up the slack if Fannie Mae and Freddie Mac reduce their investments in mortgage assets, according to a high-ranking Treasury Department official."With an appropriate phase-in period, we believe that our capital markets could adjust to a significant reduction in the presence of the GSEs as mortgage investors," said Treasury Under Secretary Randal Quarles. In building a case for portfolio limits, Mr. Quarles noted that the two government-sponsored enterprises would continue to play a "vital" role in the secondary mortgage market if they are forced to cut back on the size of their mortgage portfolios. "Their securitization and guarantee activities are now an integral and large part of the fabric of our housing credit markets and, as such, these businesses serve well the original GSE mandate," he said. The Treasury official told an international banking group that he remains "hopeful" that progress can be made in passing a GSE regulatory reform bill this year. However, the legislation in the Senate appears to be stalled due to the Bush administration's insistence on portfolio limits. The two GSEs have combined assets of $1.4 trillion. "We'd like to see these holdings substantially reduced," Mr. Quarles said.
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According to the Federal Reserve Board's latest financial stability report, persistent inflation and policy uncertainty are the primary worries for banks. Survey respondents expressed heightened anxiety over murky policy outlooks due to geopolitical turmoil and rapidly approaching domestic elections.
4h ago -
Leaders of ORNL Federal Credit Union are piloting Zest AI's new artificial intelligence-powered assistant to ensure equitable underwriting practices and measure performance against similar institutions.
6h ago -
McCargo stabilized the agency at a crucial time as she helped navigate it through both a pandemic and subsequent dramatic interest-rate cycle change.
6h ago -
The quasi-public entity's plan to buy certain closed-end seconds would constitute "unnecessary government encroachment," the Structured Finance Association said.
8h ago -
The mortgage subsidiary of Hilltop Holdings posted another quarterly loss and volume slipped, but management also sees signs of optimism.
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The increasing frequency and severity of droughts was top of mind for panelists at AmeriCatalyst's "Going to Extremes" conference Thursday.
April 18