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PR Newswire (Nov 27, 2013)
at CNBC.com (Nov 26, 2013)
at MarketWatch.com (Nov 26, 2013)
at MarketWatch.com (Nov 21, 2013)
PR Newswire (Nov 21, 2013)
Fannie Mae Prices $1.28 Billion Multifamily DUS REMIC (FNA 2013-M14) Under Its Fannie Mae GeMS™ ProgramPR Newswire (Nov 15, 2013)
at MarketWatch.com (Nov 15, 2013)
at CNBC.com (Nov 14, 2013)
at MarketWatch.com (Nov 14, 2013)
at MarketWatch.com (Nov 13, 2013)
at CNBC.com (Nov 11, 2013)
at MarketWatch.com (Nov 11, 2013)
at MarketWatch.com (Nov 7, 2013)
Government Shutdown and Debt Ceiling Debate a Real Downer on Consumer Economic and Housing SentimentPR Newswire (Nov 7, 2013)
at MarketWatch.com (Nov 7, 2013)
PR Newswire (Nov 4, 2013)
PR Newswire (Oct 31, 2013)
PR Newswire (Oct 22, 2013)
Fannie Mae Prices $1.03 Billion Multifamily DUS REMIC (FNA 2013-M13) Under Its Fannie Mae GeMS™ ProgramPR Newswire (Oct 17, 2013)
at CNBC.com (Fri, 12:28PM)
at CNBC.com (Wed, 7:00AM)
at CNBC.com (Nov 26, 2013)
at MarketWatch.com (Nov 26, 2013)
at MarketWatch.com (Nov 21, 2013)
FNMA vs. ETF Alternatives
Monday, Dec 212:22 PMHeavy criticism for GSE recap proposal
Monday, Dec 212:22 PM| 7 Comments
- "In the long history of bailout deals, no heist of the U.S. taxpayer would approach this one in cynicism and chutzpah," writes Jonathan Laing of Bruce Berkowitz's buyout plan for Fannie (FNMA +5.7%) and Freddie (FMCC +5%). One analyst calls it a "three-card monte" scheme in which the preferred holders want taxpayers to pay them off at par, or turn over the keys to the companies wildly valuable operations for little more than a $17B rights offering.
- Yes, Treasury will have realized $187B in dividends from the GSEs by year end - equal to the amount of the bailout - but that's "merely fair recompense for the enormous risks taxpayers took." Also, more than $80B of the $187B is the write-up of deferred tax assets - it will only be realized if the companies operate profitably for many years, says Laing.
Friday, Nov 222:43 PMFrannie bets a puzzle to many
Friday, Nov 222:43 PM| 8 Comments
- "When you talk to anybody in Washington, there is an almost universal view that Fannie (FNMA -3.1%) and Freddie (FMCC -1.5%) should be a part of the past, that it is a broken model, and also that private investors in Fannie and Freddie shouldn’t realize any returns from those investments," says PIne River's Colin Teiccholtz, scratching his head over anyone owning stock in the two as a play on them being privatized.
- "We've looked at it," says Avenue Capital's Marc Lasry. "I think you’re making a bet that you’re going to be able to force the government to do something.”
- It's "a puzzle to me," says an investor in Bill Ackman's Pershing Square. "If you think the Target board is hard to convince of a policy change, you have got to believe you’re really taking on a tall job to try and influence the government."
- Taking a break from talking Herbalife, Ackman - who recently disclosed near-10% stakes in the common of both Fannie and Freddie - says he's not supportive of Bruce Berkowitz's recap plan (which would be of benefit to preferred owners like Berokowitz, but not so much for owners of the common)
- MBS trader Deepak Narula calls the common stock of Frannie an option which should rise any time chatter about privatization picks up. "Whether the option is worth anything in the short run is immaterial.”
Wednesday, Nov 203:53 PMSperling: WH not interested in GSE recap plan
Wednesday, Nov 203:53 PM| 22 Comments
- "I want to make clear our administration believes the risks are simply too great, that this would re-create the problems of the past," says the president's chief economic adviser Gene Sperling of any recapitalization plan for Fannie Mae (FNMA +7.5%) and Freddie Mac (FMCC +6.4%).
- Speaking at an industry conference in D.C., Sperling says the administration is interested in rebuilding a stronger mortgage market not dominated by two mammoth institutions, and Frannie - even if restructured - would retain a large advantage over newer entrants.
- Needless to say, Sperling's remarks come in wake of Bruce Berkowitz's buyout and recap proposal for the GSEs from last week.
Friday, Nov 153:28 PMCatches aside, plan for Frannie could just work
Friday, Nov 153:28 PM| 11 Comments
- Bruce Berkowitz's presentation of his plan to purchase and recapitalize the mortgage insurance business of Fannie Mae (FNMA +10.5%) and Freddie Mac (FMCC +8.6%) cleverly leads off with quotes from politicians - including the president and FHFA chief Ed DeMarco - calling for private capital to play a larger role in the mortgage market.
- Presentation slides here.
- Bloomberg's Matt Levine's review here.
- His plan actually makes pretty good sense, but with one catch: The conversion of preferred stock for equity in a new, debt-free company with $52B in assets represents somewhere in the area of a $20B-$30B windfall for those owning the preferred.
- The plan also talks about bringing competition to the business even as it creates a new cheaply-capitalized company $52B in size. Far smaller competitors can hardly hope to match.
- Earlier: Ackman joins the fray
Friday, Nov 159:03 AMAckman takes big stakes in the GSEs
Friday, Nov 159:03 AM| 28 Comments
- Pershing Square discloses a 9.98% stake in the common stock of Fannie Mae (FNMA) and a 9.77% stake in the common of Freddie Mac (FMCC), and its intention to get involved in the reorganization discussions.
- "In light of the proposed Fairholme transaction on behalf of certain holders of preferred stock of the Issuer which was reported in the financial press, the Reporting Persons have determined that they may engage in discussions with management, the board, other stockholders of the Issuer, representatives of the Federal government, and other relevant parties ..."
Thursday, Nov 1410:02 AMBerkowitz pitches GSE plan
Thursday, Nov 1410:02 AM| 7 Comments
- Fannie Mae (FNMA +6.1%) and Freddie Mac (FMCC +6.1%) preferred shares are up sharply as Bruce Berkowitz takes to CNBC to talk up his recapitalization plans for the GSEs. The Fannie Mae Preferred S series (the most popular vehicle) is ahead 9.7% to $9.70 - in a recap, these would get paid at par, or $25, and Berkowitz is talking about a time frame of June 2014.
- "We helped before with AIG, it can work with Fannie and Freddie."
- Other preferred shareholders with whom Berkowitz is trying to garner support include Blackstone, Perry Capital and GSO Capital. His plan is to purchase and recapitalize the mortgage-guarantee business of the GSEs and turn them into state-regulated bond insurers with no federal perks. The nearly $5T in assets and liabilities currently managed by Fannie and Freddie would remain with the government.
- Treasury and FHFA officials have previously said such ideas are DOA. "Some people are forgetting a little history," chides FHFA chief Ed DeMarco to those who assume recent nice results from Frannie mean their problems are solved.
Wednesday, Nov 139:00 PMFairholme proposes $52B recap for GSEs: WSJ
Wednesday, Nov 139:00 PM| 7 Comments
- Fairholme Capital Management offers to spearhead a move by a consortium of investors aimed at "purchasing, recapitalizing, and operating the mortgage-guarantee businesses" of Fannie Mae (FNMA) and Freddie Mac (FMCC) as state-regulated bond insurers, WSJ says.
- The offer was reportedly outlined by Bruce Berkowitz in a letter sent Wednesday evening to federal regulators.
- Earlier: Hedge funds pitch takeover of Frannie
Wednesday, Nov 137:46 AMHedge funds pitch takeover of Frannie
Wednesday, Nov 137:46 AM| 2 Comments
- The closest thing to a cash offer from the private sector to help reorganize housing finance in this country, a number of hedge funds have proposed converting their $34.6B of preferred stock of Fannie Mae (FNMA) and Freddie Mac (FMCC) and helping to underwrite a $17.3B rights issue.
- "We plan to put up real money, this is not just a trade,” says one member of the group, which says the plan brings in private capital while leaving taxpayers with legacy mortgage guarantees from which they can profit as housing continues to recover.
- It remains to be seen if politicians agree that a group of hedge funds taking over the GSEs meets their idea of private capital.
- "This trade reminds me of the adage, buy them for a good time but not a long time,” says one skeptical hedge fund chief. "The guarantee business is a great business,” says one of the group. “You can’t get rid of Fannie and Freddie.”
Thursday, Nov 712:56 PM
Thursday, Nov 78:23 AMFannie Mae earns $8.7B in Q3
Thursday, Nov 78:23 AM| 12 Comments
- Fannie Mae (FNMA): Q3 net income of $8.7B up from $1.8B in year-ago quarter. Positive net worth of $11.6B and will pay $8.6B dividend to Treasury.
- The "dividend sweep" will have Fannie paying $82.4B to Treasury this year, and bring the total dividends paid to $113.9B vs. $116.1B in draws from 2008-11. Treasury - of course - retains its $117.1B in preferred stock.
- Press release.
Thursday, Oct 313:08 PMReport: Fannie Mae sues group of banks for $800M over Libor
Thursday, Oct 313:08 PM| Comment!
- Barclays (BCS -1.6%), UBS (UBS -0.2%), and Royal Bank of Scotland (RBS +1.2%) are among those facing suit by Fannie Mae (FNMA) over alleged Libor-rigging, reports Bloomberg, citing a copy of a federal court filing in NYC. The filing hasn't yet been confirmed in court records. All three banks have already settled Libor cases with various regulators.
Thursday, Oct 244:30 PMNew (lower) Fannie and Freddie loan limit announcement coming
Thursday, Oct 244:30 PM| 3 Comments
- Though the announcement is set for November, it will take at least six months for the lower limits to take effect, FHFA chief Ed DeMarco tells an audience. This should give the housing lobbying groups plenty of time to muster support for softening or eliminating the reductions.
- The current loan limit runs as low as $417K for a single-family home. "Any reduction would be across the board, not just in some parts of the country," says DeMarco.
- Fannie Mae (FNMA). Freddie Mac (FMCC).
- Homebuilder ETFs: XHB, ITB, PKB.
Wednesday, Oct 234:00 PMCountrywide found guilty in U.S. mortgage suit
Wednesday, Oct 234:00 PM| 23 Comments
- A federal jury has found Bank of America's (BAC -2.1%) Countrywide unit liable for defrauding Fannie Mae (FNMA +22%) and Freddie Mac (FMCC +19.4%) by selling them thousands of defective mortgages.
- The judge will determine the amount of the penalty - the U.S. has requested $848M, the gross loss to the GSEs as calculated by its expert witness.
- The suit centered on Countrywide's HSSL - High Speed Swim Lane - program instituted in August 2007, says the government, to keep the music playing as the property market was falling apart.
Wednesday, Oct 2310:33 AMRanieri pulls plug on nonagency MBS offering
Wednesday, Oct 2310:33 AM| 8 Comments
- There's more evidence Fannie (FNMA +6.8%) and Freddie (FMCC +7.6%) aren't going anywhere anytime soon as Shellpoint Partners - led by mortgage kingpin Lew Ranieri - pulls a planned MBS offering for the 2nd time this month, citing soft demand. The company had restructured the bond issue - backed by jumbo residential mortgages - by removing some of the riskier loans in exchange for better agency ratings, but it still wasn't able to get the prices it wanted.
- Issuance of nonagency paper had flown earlier this year, but has ground to a halt since interest rates began rising this spring. Additionally, Frannie has begun offering a new security more tied to credit than rates, thus sapping some demand for nonagency bonds.
- Trying to break into the nonagency issuance market, PennyMac Mortgage Investment Trust (PMT +0.2%) last month had to cut prices at least twice on its debut offering. Redwood Trust (RWT -0.6%) - which pretty much had the nonagency field to itself not long ago - has struggled mightily since the spring.
Monday, Oct 75:16 PMReal estate lobbying groups flex muscle over FHFA loan limits
Monday, Oct 75:16 PM| Comment!
- Hasn't housing recovered? The National Association of Realtors and National Association of Home Builders send a letter to House representatives asking them to prevent the FHFA from lowering conforming loan limits for Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB).
- "While there has been some return of private mortgage lending, without the benefit of a federal guarantee, it remains limited and available only to the most highly qualified borrowers ... FHFA Acting Director DeMarco appears to be making decisions above and beyond this authority provided by Congress and may significantly damage local housing markets."
- The FHFA wants to cut the limits beginning in 2014 in order to shrink the GSEs presence in the mortgage market and allow room for private capital to enter.
Monday, Sep 238:30 AMNot so easy to replace Fannie and Freddie
Monday, Sep 238:30 AM| 7 Comments
- While Washington is finally seriously thinking about how to replace Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB), as on many other issues, Republicans and Democrats are deeply divided about what to do.
- Superficially, the argument is about the role of government in the mortgage market, writes the WSJ's Nick Timiraos, but the real question is whether Americans should have "relatively easy access to the pre-payable, 30-year, fixed-rate mortgage?"
- One problem with scrapping Fannie and Freddie is that they - with a government guarantee - back $4.5T of almost $10T in outstanding mortgage debt. Any replacements would have to absorb trillions of dollars of credit and interest-rate risk.
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