Wednesday, November 19, 2014

mell watt testimony to senate 11/19/2014

C. Build a new single-family securitization infrastructure for use by the Enterprises
and adaptable for use by other participants in the secondary market in the
FHFA’s final strategic goal is to BUILD a new infrastructure for the Enterprises’ securitization
functions. This includes ongoing work to develop the Common Securitization Platform (CSP)
infrastructure and to improve the liquidity of Enterprise securities. We have clarified that 
FHFA’s top objective for the CSP is to make sure that it works for the benefit of Fannie Mae and 
Freddie Mac. We are also requiring that the CSP leverage the systems, software and standards
used in the private sector wherever possible. This will ensure that the CSP will be adaptable for
use by other secondary market actors – including private-label securities issuers – in the future.
In addition, FHFA has also worked with the Enterprises to leverage the CSP in order to develop
a Single Security, which we believe will improve liquidity in the housing finance markets.

FHFA as Regulator:

FHFA to fulfill the following duties:
“(A) to oversee the prudential operations of each regulated entity; and
“(B) to ensure that--
(i) each regulated entity operates in a safe and sound manner, including
maintenance of adequate capital and internal controls;
(ii) the operations and activities of each regulated entity foster liquid, efficient,
competitive, and resilient national housing finance markets (including activities
relating to mortgages on housing for low- and moderate-income families
involving a reasonable economic return that may be less than the return earned on
other activities);
(iii) each regulated entity complies with this chapter and the rules, regulations,
guidelines, and orders issued under this chapter and the authorizing statutes;
(iv) each regulated entity carries out its statutory mission only through activities
that are authorized under and consistent with this chapter and the authorizing
statutes; and
(v) the activities of each regulated entity and the manner in which such regulated
entity is operated are consistent with the public interest.”
12 U.S.C. § 4513(a)(1)

FHFA as conservator:

FHFA’s authority as both conservator and regulator of the Enterprises is based upon statutory
mandates enacted by Congress, which include the following conservatorship authorities granted
by HERA:
“(D) …take such action as may be--
(i) necessary to put the regulated entity in a sound and solvent condition; and
(ii) appropriate to carry on the business of the regulated entity and preserve and
conserve the assets and property of the regulated entity.”
12 U.S.C. § 4617(b)(2)(D).

Preserve and Conserve assets and property!!!!!!!!!! Cash dividend to Treasury is ILLEGAL!!

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