WASHINGTONThe Treasury Department has decided not to restructure the taxpayers stake in Fannie Mae and Freddie Mac , effectively ending the Trump administrations push to ensure that the mortgage giants are eventually returned to private hands.
The announcement by the Treasury Department under Secretary Steven Mnuchin and the companies federal regulator leaves it to the incoming Biden administration to decide the future of the firms, which were put under government control during the 2008-09 financial crisis through a process known as conservatorship.
Advisers close to President-elect Joe Biden have said he would be in no hurry to privatize the companies, which guarantee roughly half of the $11 trillion U.S. mortgage market. Instead, Mr. Biden would focus on ways to use the companies to boost housing affordability and promote homeownership, the advisers said.
Under a more modest agreement announced Thursday by the Treasury Department and the Federal Housing Finance Agency, Fannie and Freddie will be allowed to retain more of their earnings, boosting the companies ability to absorb potential losses. FHFA is the companies independent federal regulator.
Write to Andrew Ackerman at andrew.ackerman@wsj.com