Fannie Mae, Freddie Mac Stocks Surge On Trump Privatization Remarks: What's Going On?

Shares of Fannie Mae Inc. and Freddie Mac Inc. are trading higher Thursday after President Donald Trump said he is seriously considering taking the mortgage giants public.

What To Know: In a Truth Social post, Trump called the government-sponsored enterprises "very profitable" and said the timing "seems right" to privatize them. He added that he would consult with top officials, including Treasury Secretary Scott Bessent and FHFA Director William Pulte, before making a decision.

The rise in both stocks follows years of speculation about the future of Fannie and Freddie, which have remained under federal conservatorship since the 2008 financial crisis. Though profitable and backed by private shareholders, the companies have been under tight government control for more than 15 years. They buy mortgages from lenders and repackage them into mortgage-backed securities, supporting nearly half of the U.S. residential mortgage market.

Trump's remarks come amid recent upheaval at the Federal Housing Finance Agency. Director Pulte recently fired Freddie Mac's CEO, dismissed 14 board members from both institutions, and appointed himself chairman of both entities. The shakeup suggests a shift toward more direct federal control ahead of potential privatization.

The surge also follows a new tender offer from Fannie Mae for its Connecticut Avenue Securities notes and Freddie Mac's latest mortgage rate update showing a slight uptick in 30-year fixed rates to 6.86%. Market watchers also noted support from influential investors like Bill Ackman, who has said the companies are primed to exit conservatorship under a Trump administration.

With no final decision announced, speculation is driving the rally. Traders are reacting to the possibility of long-awaited structural changes at the heart of the U.S. housing finance system, potentially setting the stage for one of the biggest public offerings in years.

Price Action: Fannie Mae shares are up 42.4% at $10.60 and Freddie Mac shares were up 41.1% at $8.00 at the time of writing, according to Benzinga Pro.

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