Looks like Trump wants to take the government-backed mortgage giants Fannie Mae and Freddie Mac public after DC took ownership during the 2008 financial crisis.
This would look to be a temporary boost of about $30 billion for the government, but its implications for the future of mortgages is unclear.
From the Wall Street Journal:
The Trump administration is preparing to sell stock in mortgage giants Fannie Mae and Freddie Mac in an offering it believes could raise around $30 billion and kick off later this year, according to people familiar with the matter.
The plans being discussed by some administration officials could value the companies at roughly $500 billion or more combined and involve selling between 5% and 15% of their stock, some of the people said. Still up for debate is whether the mortgage giants would IPO as one company or two separate entities.
You will soon be able to buy shares of Fannie and/or Freddie if this deal works out. The government might still own the entities, but shareholders would get a say in things as well.
More from Reuters:
They were bailed out with taxpayer funds, and the Treasury received preferred shares in return, which paid billions of dollars in dividend[s] over the years.
Over the years, efforts to return them to private control have continued, including under Trump's first term.
Trump also met the CEOs of Citigroup and Bank of America earlier this week to discuss the administration's plans to privatize the mortgage giants, Reuters had reported earlier.
It sounds like this has been in the making for some time, and Trump is finally making the push to bring this sale to fruition.
President Trump announced in May his intentions to bring the mortgagers public and continue implicit guarantees, and it looks like it's time.
Shares for Fannie and Freddie are taking off as we speak.
Fannie's shares, which trade over-the-counter, rose 20%. Freddie climbed 15%.
LOTS of feelings in the financial world about this one!
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