Fannie-Freddie Shares Slide as Mnuchin Dims Investors' Hopes
- Recap and release won’t happen without housing revamp, he says
- Treasury secretary wants ‘reform’ before ending U.S. control
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Treasury Secretary Steven Mnuchin made clear that freeing Fannie Mae and Freddie Mac from U.S. control won’t happen without an overhaul of the nation’s housing finance system, potentially dashing investors’ hopes that they might soon make a windfall from their stakes in the mortgage giants.
In a June 8 interview, Mnuchin was adamant that the Trump administration won’t just let Fannie and Freddie build up their capital buffers and then release the companies. He also said he backed a key reform that only Congress can implement, casting doubt on how ambitious the administration will be absent a legislative fix. Fannie and Freddie shares fell on his comments.