Fannie and Freddie to get $3bn capital buffer boost

By David Bell
21 Dec 2017

The US Treasury and the Federal Housing Finance Agency (FHFA) agreed on Thursday to allow government sponsored enterprises Fannie Mae and Freddie Mac to maintain a $3bn capital buffer, reversing a previous plan that would have slashed the buffers to zero.

Under the change to the terms of the deal that the FHFA has with the Treasury, the agencies will still pay a quarterly dividend into the government’s coffers – but will be able to put aside $3bn of capital to weather income fluctuations. In return, the Treasury’s liquidation ...

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