The Trump administration is preparing to release as early as the first part of September its long-awaited plan to return Fannie Mae FNMA, +8.18% and Freddie Mac FMCC, +7.69% to private-shareholder ownership, according to people familiar with the matter.
The proposal comes more than a decade after the government seized the mortgage-finance firms to save them from collapse. It would likely seek to put the companies on a sounder financial footing and then release them from government control if Congress doesn’t enact a more fundamental overhaul in the meantime, these people said.
The plan, which could be floated shortly after the Labor Day holiday, is expected to envision a version of what has been called “recap and release,” which would ensure the firms have adequate capital to absorb loan losses in a future housing slump. Its provisions aren’t expected to give details for initial public offerings for the firms, the people said.
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