Federal Housing Enterprise Oversight Office June 2008 – Federal Register Recent Federal Regulation Documents

Risk-Based Capital Regulation-Loss Severity Amendments
Document Number: E8-13378
Type: Rule
Date: 2008-06-25
Agency: Federal Housing Enterprise Oversight Office, Department of Housing and Urban Development
The Office of Federal Housing Enterprise Oversight (OFHEO) is amending its regulations related to Risk-Based Capital (Risk-Based Capital Regulation) to enhance the transparency, sensitivity to risk, and accuracy of the calculation of the risk-based capital requirement for the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). OFHEO is amending the Risk-Based Capital Regulation by changing the current loss severity equations that understate losses on defaulted single-family conventional and government guaranteed loans and by changing the treatment of Federal Housing Administration insurance in the Risk-Based Capital Regulation to conform the treatment to current law.