The Conservator of Fan/Fred (which is FHFA) was testifying at a hearing the other day.
Here's an interesting little graf which deals with toxic loans which have gone very, very bad. They were initiated by brokers and banks, and FHFA has exercised its right to force "repurchase"--that is, make the Banks/Brokers eat their poison lunch:
More than one-third of these repurchase requests have been outstanding for more than 90 days. Many of the lenders with aged, outstanding repurchase requests are among the largest financial institutions in the United States. The delays by lenders in repurchasing these loans are a significant concern to FHFA. There are ongoing discussions between the Enterprises and lenders to reach a workable solution. If these discussions do not yield reasonable outcomes soon, FHFA may look to its supervisory and conservatorship authorities provided under the statute to resolve the situation.
Ticker wants to know why this isn't a matter before various US Attorneys for prosecution.
As to WHY the Banks are slow-walking the repurchases? Not hard to figure; they'd be insolvent if they took 'em back and recognized the losses.
Wanna bet that Bank of America (which brags that they repaid TARP) is one of those 'largest financial institutions'?
HT: Ticker
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