How and when is a GSE’s Subordinated Debt requirement determined?

OFHEO determines and publishes the GSEs’ qualifying subordinated debt requirements on a quarterly basis. The requirements for qualifying subordinated debt are defined in the September 1, 2005 agreements between OFHEO and the GSEs. Subordinated debt will be issued in a quantity such that the sum of the total capital (core capital plus general allowance for losses) plus the outstanding balance of qualifying subordinated debt will equal or exceed the sum of outstanding net MBS times 0.45 percent and total on-balance sheet assets times 4 percent.

What documents establish the GSEs’ Subordinated Debt requirements?

Please see the following:

Fannie Mae Subordinated Debt Agreements

Freddie Mac Subordinated Debt Agreements

If I have a question about Subordinated Debt requirements but can not locate the answer on the OFHEO web site, how do I submit my question?

OFHEO has an e-mail address for all capital-related questions: rbcquestions@ofheo.gov . Please include your name and affiliation. All responses will be provided in writing, as soon as possible.