MBA calls it time for ‘rogue elephants’ Fannie, Freddie

03 Sep 2009

The Mortgage Bankers Association outlined a proposal this week to reform the US mortgage agencies to prevent a repeat of the liquidity crisis that afflicted the agency bond market last year.

Under the MBA plan, Fannie Mae and Freddie Mac would be replaced by a variety of new, privately owned mortgage credit guarantor entities (MCGEs). The MCGEs, which would be regulated on a utility basis for a "conservative" return on equity and high capitalisation, would provide loan level guarantees ...

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