Fannie Mae (QB) (FNMAT) Quote

The regulatory capital has the purpose to cover the future "unexpected" losses.
The "expected" losses are covered by the Loan Loss Reserve that doesn't appear in the Net Worth.
And we have Calabria who recently said in an article that the Net Worth absorbs the credit losses in mortgages.
A former FHFA Director refusing to talk in technical terms and wrong, and prefers to go full "unsophisticated" mode.

The Loan Loss Reserve is better known as the Allowance for Credit Losses, currently $15.4B in FnF together, under the CECL accounting standard (Current Expected Credit Losses), a provision set aside even the very moment of purchase of the mortgage.
No CECL for the banks' Commercial Real Estate loans?

But "expected" losses means that, besides loans individually impaired, it's also being used as "General Reserve for Loan Losses", based on the assessments of the management about the foreseeable future, which may be wrong and this reserve might end up being released (Benefit for Loan Loss in the Income Statement).
This Allowance for Credit Losses appears on the Balance Sheet as Asset write-down, reducing the mortgage assets because it assumes that the loss already occurred, when it's false. This is why the portion that is a General Reserve, is recorded as low quality TIER 2 Capital to calculate the Total Capital that has to meet the 8% of the Risk-Weighted Assets (FnF, U.S. banks and Basel).
In FnF, the full Allowance for Loan Losses is recorded as Tier 2 Capital. Thus, it's all a General Reserve.

The credit losses or "charge-offs" during the period, are debited from this Loan Loss Reserve already built with the prior provisions set aside. The credit losses don't appear on the Income Statements. The provisions had already prompted the losses on the Income Statements in the past.

More evidence that puts into question the concept of "Capital Buffer" through regulation, because this Loan Loss Reserve is the first "buffer", not recorded as capital. In what looks like Capital Buffers to protect the "Fairholmes of the world" that enjoy a high dividend rate on Preferred Stocks and don't want Prompt Corrective Actions as we've seen with FnF with the dividend suspended, and instead, they use their JPS for the assault on the ownership interest after inflicting the insolvency in their prey on purpose, for instance, with outstanding provisions set aside. Sounds familiar?

There is a limit in the amount of Allowance for Credit Losses that can be recorded as TIER 2 Capital, of 0.6% of the RWA, written in the FHFA Capital Rule, the same as Basel, no limit in the FHEFSSA.

Calabria's HERA struck the section in the FHEFSSA with the Risk-Based Capital requirement, so we don't see published the swelled Allowance for Credit Losses in early Conservatorship with the Obama's loan modifications spree that artificially swelled the provisions set aside, recorded as Tier 2 Capital in the Total Capital, to meet this threshold, as seen today:
Freddie Mac: remember that the Core Capital is assessed badly, because the Core Capital is calculated with the sum of its components (FHEFSSA image below), not beginning with Equity, less SPS, less AOCI (it can be deemed a felony):

FHEFSSA:


pending a new Capital Rule that took 13 years to make, due to the absence of the section 18-month IMPLEMENTATION in HERA, as usual in the FHEFSSA.
This is why we've had N/A in the FHFA Reports to Congress (Obscurantism) until then:


This concept of Allowance for Credit Losses accounted for in the Total Capital provided that it's a General Reserve, is written in the FHEFSSA definition of Total Capital, Basel and the FHFA Capital Rule.
FHEFSSA:

LOL.

I'll go out on a limb, and call for tomorrow

5-7% gains for Mae and Mac

Mark this post

I sure hope that you’re right, Tutt!!!

what’s special about july 17th?

Sellers eat sh*t, holders will go to the moon

1.. settlement will be settled directly through brokers in each account holder.

2. Each day , the damage interest of about $970, 000 is adding up .

3. July 16 is getting closer
It's going to be an exciting week.

Why is Lamberth taking so long?
In my opinion, it's taking so long because it's a complete package.
It's a settlement and at the same time, exiting conservatorship from government control in order to resolve shareholder contracts.

Orders from higher ups.

What good is a reward without defining punishment! Whole thing is a laughing stock!

He lost it on his desk... And someone borrowed his pen and didn't return it yet.

"We at least got the lamberth award."

Not so fast there buckaroo! He hasn't "awarded" squat as of yet.

Why is Lambert taking so long? Can we write tho his superiors - if so, who?

Closed low of day what a shocker.

Settlement will be settled directly through brokers. When???

Who knows when..

Can we bury @FHFA in the same coffin?— Guido da Costa Pereira (@GuidoPerei) July 10, 2024

I agree! My analysis of price is conjecture, but at least it's based in some real facts which others don't want to recognize. And those facts are just that, facts. They are not conjecture.

The day you shut the F* up will be a good day! My goodness, are you annoying.

stockanalyze, I think we should get off this board by reason of a moderator.

I responded to your post on the non-moderated board. Regards

https://investorshub.advfn.com/boards/read_msg.aspx?message_id=174732354

Someone wants a seat at the table !!!

He hasn’t lost since he replied to my post about 2 years ago now . I check his profile he hasn’t posted anyway since . Don’t know what happened t him .

A large chunk of my hope is placed on Trump winning and taking us out of cship.

We atleast got the lamberth award. Let's hope that pays put within the next 1-1.5years.🥱

Is Camero still around? I will give you credit for being in commons all these years and don't trade at all. You must like pain.

Thank you - I'm implementing Rule 27.
Those who wish to sell their
FNMA or FMCC must first get my
permission to sell, by filling out
Form 2485B and submit it to me,
I will either approve their request within
3 business days, or deny the request

A box of Kirkland's k-kup coffee pods, breakfast blend, a pack of two mango nectar and a bottle of vodka please. Danka.

This hemorrhaging has to stop. Anyone have a tourniquet handy ? Paging Dr. TightCoil STAT.

i am confused with his new post. no release till 2040? banks, pimco behind it. the point is what is new? we well know banks do not want them to be released. catman did everthing possible that they are not released. follow the money where he gets his paycheck from.

The price is what people are willing to pay…
That’s the price…
Your analysis is just pure conjecture, which is what everyone is doing… lol
You don’t know squat anymore than anyone else.

Consider it lucky they're minimal thus far. There's really no justification for even the current price, and certainly none for it to go higher.

More losses today.

DCbill - Why isnt that a possibility? Merge them and move them to Cincinatti and reduce the MBS fees all homeowners pay with the cost efficiencies.

Knocked down to 1 post. Maybe, everyone on this board move over to the non-moderated get away from Shelly.

"Fannie/Freddie Politics Board (Poltics Allowed~Non-Moderated)"

https://investorshub.advfn.com/FannieFreddie-Politics-Board-Poltics-Allowed~Non-43002

Anyone remember the Moelis plan

This one went BK

https://www.yahoo.com/news/happens-bank-isn-t-really-174139347.html

lol

SPS aren't regulatory capital. $402B core capital shortfall over Minimum (Leverage) Capital requirement, makes the debate about capital requirements in FnF, pointless. Brought to you by the controversial member of Fairholme's legal team, Timothy Howard, all day with "bank-like", when the Basel framework for capital requirements is assessed for the same credit exposure.


As required by the Treasury Department in 2011 for the release from conservatorship: increase the guarantee fees so that FnF are subject to the same capital standards as the fully private banks (Basel framework). That is, a Charter revoked scenario (no UST backup of FnF anymore, "GSEs")


Minimum Risk-Based Capital requirement: The CET1 and Total Capital requirements as percentage of the Risk-Weighted Assets (RWA), coincides with the U.S. banks and Basel (4.5% and 8%, respectively. ERCF tables)
But with regard to the minimum Leverage ratio in FnF (previously known as Minimum Capital level), the TIER 1 Capital > 2.5% of Adjusted Total Assets, stands below the U.S. banks with TIER 1 Capital > 3% of Total Assets. This is the binding capital requirement in FnF (highest).
Here the FHFA might have considered their monoline insurance business model.

The FHFA's "back-end" Capital Rule (unveiled after the typical Transition Period to build capital when there are changes, due to the lack of "18-month IMPLEMENTATION" section in the amendment in HERA of the FHEFSSA, like before) that came into effect on February 16th, 2021, adopted the Basel framework for capital requirements.
It means that it's a framework and the FHFA or the Federal Reserve, through regulation, are allowed to change the inputs. For instance:
▪️The Risk-Weights in the mark-to-market LTV/Credit Score matrix to calculated the RWA, an amount later multiplied by the percentage of capital requirement;
▪️A 20% Risk-Weight floor in FnF;
▪️Capital Buffers (above the minimums), which should be a decision by the management, because the minimum regulatory capital already absorbs losses directly or through Prompt Corrective Actions.
▪️The GSIBs have a surcharge.
▪️Etc.

But the Federal Agencies can't change the framework, that is, the capital metrics, their definition and, thus, the fact that the cumulative dividend SPS are NOT considered regulatory capital (not loss-absorbing capacity with the dividend suspended); The concept of "Capital Reserve" doesn't exist in the Basel framework; Likewise, the figure of "Net Worth" isn't considered to evaluate the soundness and solvency, but the capital metrics. Etc.

This rogue Ihub poster sounds familiar to me.
Any impact on Fannie / Freddie capital reserves requirements?

No impact.

https://www.msn.com/en-ca/money/topstories/exclusive-fed-considers-rule-tweak-that-could-save-biggest-us-banks-billions-in-capital/ar-BB1pFhON?ocid=BingNewsVerp

Any impact on Fannie / Freddie capital reserves requirements?

The Chief Information Officer (CIO) of Fannie Mae reported a holding of 1,300 $FNMA one year ago.


🫡
First Time Ever An Insider Reports Holding Common Stock!!!!

Yes I know that. That msg was exclusive for the eyes of CatBirdSeat only

Had a Kraut dog yesterday. Delicious!!!

That would be 9% of all FNMA shares traded today and about 14% of what was traded yesterday. Really anemic trading recently.

Below is about al one needs to read"

"In his interview with Bloomberg Intelligence, Calabria greatly overstated the capability of FHFA to remove Fannie and Freddie from conservatorship without Treasury’s concurrence. He said that he and Mnuchin “ended the net worth sweep,” but they did not; they merely suspended it (while increasing Treasury’s liquidation preference dollar-for-dollar) until the companies can accumulate the (excessive) amount of capital Calabria’s “risk-based” capital standard requires of them, at which point it will kick in again."

169,755 share $Freddie $Block $Trade ...

Shared link to the blog with Calabria and PIMCO.

@MarkCalabria @PIMCO https://t.co/nIIaXMxShM— Guido da Costa Pereira (@GuidoPerei) July 9, 2024

We need a good slapping.

FWIW FNMAS is up today on 344K volume ,,0.04 but has been 3.43

F&F Merging?
Humble opinion, "Not in God's lifetime."

Oh wow. I’m going to Costco. Get me a juicy dog. Anyone need anything ? Gabby ?

Here are a few



stocktwits
corner of berkshire and hathway (if its worthy and active still)
fnma yahoo msg board
howard on mortgage finance (for comments section with valid discussions)

Hey Hey Hey

we never keep score of bradfords' prediction here.. We all have a general agreement, that the goal posts will move by a quarter every 60-80 days and no one on this board should giggle, question, mock or poke at the move.. We all have an understanding here and live with it.. Dont ruin it for us. we have been playing this game for nearly 5-7 years...

I thought you own Preferred.. I always get confused with all the agenda aliases

Coming to the point, with our bad luck, thats possible too, with everything that happened to us in the last 16 years...

Too many fastfood burgers can cause heart attacks