Treasury Secretary Steven Mnuchin was pressed for his views on housing finance reform, what a “modernized” version of the Glass-Steagall Act would look like and a two-tiered regulatory system.
Fannie Mae and Freddie Mac should be able to rebuild a capital buffer to avoid any potential crisis in the mortgage market, according to a coalition of affordable housing advocates, homebuilders and small mortgage lender groups.
Treasury Secretary Steven Mnuchin is expected to face tough questions on the OCC, Glass-Steagall and housing finance reform when he testifies on Thursday.
FHFA Director Mel Watt warned Thursday that to prevent a potential draw on the Treasury Department by the government-sponsored enterprises, he is willing to act unilaterally to rebuild capital at Fannie and Freddie.
The Treasury secretary on Monday reiterated an aggressive timetable for tackling the future of Fannie Mae and Freddie Mac, an issue that has long flummoxed Congress.
Senate Banking Committee Chairman Mike Crapo and House Financial Services Committee Chairman Jeb Hensarling said they believed an agreement on housing finance reform could be struck in this Congress.
The Mortgage Bankers Association released a detailed transition plan Thursday designed to help policymakers turn the government-sponsored enterprises into private guarantors of mortgage-backed securities.
Suspending Fannie Mae and Freddie Mac's regular dividend payments to the Treasury, thus enabling the companies to replenish their reserve capital, would put their future on better footing.
