Watt searches for GSE risk-share template

mel watt
By Matthew Scully
14 May 2014

The chief housing regulator that oversees Fannie Mae and Freddie Mac is not yet convinced it has nailed down the appropriate model to transfer risk to private investors, and it may further test the market with new types of deals to ensure the GSEs are charging enough to guarantee the bonds they are selling.

Fannie Mae and Freddie Mac, which between them have issued six risk-sharing deals, will in 2014 each triple the risk transferred to the private market and experiment with a minimum of two different structures to reduce taxpayer exposure to credit risk.

"Executing multiple types of risk-sharing transactions will ...

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