House Republicans target Fannie, Freddie
Mortgage-finance giants would shrink if bills are approved
By Robert Schroeder, MarketWatch
WASHINGTON (MarketWatch) — House Republicans took fresh aim at mortgage-finance giants Fannie Mae and Freddie Mac on Tuesday, as a subcommittee began work on a package of bills designed to shrink the entities and limit their support from the government.
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Members of a House Financial Services subcommittee were meeting Tuesday to debate seven bills broadly intended to limit a taxpayer bailout of Fannie and Freddie, which were taken over by the government nearly three years ago.
One bill limits government support for Fannie FNMA +0.03% and FreddieFMCC -1.91% to $200 billion; another directs their federal overseer to require them to dispose of all nonmission-critical assets. Another prevents the Treasury Department from lowering the 10% dividend payment paid to taxpayers on the senior preferred stock of both entities. Read more about bills from the House committee’s website.
The House panel previously has approved other Fannie and Freddie reform bills, and the latest batch is expected to pass the subcommittee, the full committee and the full Republican-controlled House. But passage in the Democratic-controlled Senate is by no means certain.
The Obama administration has pledged to keep the companies afloat with aid, but also says it wants to wind them down.
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