President Donald Trump announced Wednesday he is giving “very serious consideration” to taking mortgage finance giants Fannie Mae and Freddie Mac public, signaling potential privatization of the government-sponsored enterprises.
What Happened: In a Truth Social post, Trump said he will consult with Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and Federal Housing Finance Agency Director William Pulte before making a decision. “Fannie Mae and Freddie Mac are doing very well, throwing off a lot of CASH, and the time would seem to be right,” Trump stated.
The mortgage giants, which underpin approximately half of the U.S. residential mortgage market, have generated substantial cash flows since their 2008 conservatorship, according to Reuters. Both companies operate as for-profit corporations with private shareholders, purchasing home loans from private lenders and repackaging them as mortgage-backed securities.
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Why It Matters: Fannie Mae and Freddie Mac were placed under Federal Housing Finance Agency conservatorship during the 2008 financial crisis after suffering overwhelming losses from the housing market collapse. The government intervention prevented catastrophic economic effects but maintained federal control over the entities.
FHFA Director Bill Pulte recently fired Freddie Mac CEO Diana Reid and placed senior FHFA officials on administrative leave. Pulte also dismissed 14 board members from both companies and appointed himself chairman of both entities.
Billionaire investor Bill Ackman of Pershing Square Capital Management has recommended both companies as investments, stating in December that he expects them to exit conservatorship under the Trump administration. “Trump likes big deals and this would be the biggest deal in history,” Ackman wrote.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
