Posted on Monday, August 23, 2010
July 29, 2010
Washington DC—House Financial Services Committee Chairman Barney Frank and Capital Markets, Insurance and Government Sponsored Enterprises Subcommittee Chairman Paul E. Kanjorski today announced that the committee will continue its series of hearings on the future of housing finance in September. Chairman Kanjorski will conduct an oversight hearing of the GSEs, and the full committee will continue its examination of policy options for restructuring the nation’s housing finance system.
“By passing the legislation in 2008 that allowed the Bush administration to put the GSEs into conservatorship and by finally enacting strict prohibitions against the sort of reckless, predatory and subprime loans that have been made in the mortgage market, we have completed the initial, defensive steps needed in the housing area. We will continue our efforts as we move to the next phase, a complete restructuring of the tangle of housing finance tools so that we move forward in a way that protects taxpayers, prevents economic turmoil and appropriately serves all aspects of the housing market,” said Chairman Frank.
Said Chairman Kanjorski: “The landmark Wall Street reform law has laid the foundation for reforming our housing finance system by altering securitization rules, protecting against inflated appraisals, and holding rating agencies accountable. The Capital Markets Subcommittee has already convened several hearings about the future of housing finance, and in September we will examine taxpayer protection issues in greater depth. In particular, we intend to explore the Federal Housing Finance Agency’s recent efforts to recoup funds from the issuers of the underwater securities purchased by Fannie Mae and Freddie Mac. We also will examine the present policies related to calculating guarantee fees, including whether these charges are appropriately priced to cover risks and provide a reasonable return. Moreover, as our housing markets begin to stabilize, we will begin to consider innovative ideas for recovering the costs resulting from the decision to place Fannie Mae and Freddie Mac into conservatorship. Twenty years ago, we found a way for industry to pay back the sizable U.S. Treasury payments for resolving the savings-and-loan crisis. We can do it again.”
Previous hearing transcripts and testimony are available on the Financial Services Committee website.