The Federal Housing Finance Agency (FHFA) has contracted Houlihan Lokey Capital Inc. to serve as its financial advisor during the process of ending the federal conservatorship
of the government-sponsored enterprises (GSEs).
According to a statement
issued by the agency, the New York City-headquartered investment bank will “consider business and capital structures, market impacts and timing, and available capital raising alternatives” as part of its duties. The GSEs have been in federal conservatorship since September 2008.
The FHFA will pay Houlihan Lokey $9 million for the first year of its contract, and the agency has options to extend the contract for another four-and-a-half years, with the company receiving up to $45 million for its services.
“Hiring a financial advisor is a significant milestone toward ending the conservatorships of the enterprises," said FHFA Director Mark Calabria. “The next major milestone for FHFA is the re-proposal of the capital rule, which will happen in the near future."