June 1, 2022

FHFA: Final Rule Announced Requiring Fannie Mae and Freddie Mac to Submit Annual Capital Plans

The Federal Housing Finance Agency (FHFA) today published a final rule that supplements the Enterprise Regulatory Capital Framework (ERCF) by requiring Fannie Mae and Freddie Mac (the Enterprises) to submit annual capital plans to the Agency and provide prior notice for certain capital actions. The final rule also incorporates the stress capital buffer determination from the ERCF into the capital planning process.

The final rule mandates that the Enterprises’ capital plans include:​

“The final rule provides the Enterprises with a stable regulatory framework that ensures the amount of capital held is commensurate with each of their risk profiles,” said FHFA Acting ​Director Sandra L. Thompson. “This is an important step in securing the safety and soundness of the Enterprises by actively monitoring and maintaining proper levels of capital throughout the economic cycle.” 

The requirements in the final rule are consistent with the regulatory framework for capital planning for large bank holding companies. The final rule will be effective 60 days after the day of publication in the Federal Register. Under the final rule, each Enterprise will submit its first capital plan by May 20, 2023.  

Capital Planning and Stress Capital Buffer Determination Final Rule 

This post was originally published here.