Trump's order for Freddie, Fannie to buy $200 billion mortgage bonds raises IPO doubts

By Utkarsh Shetti

Jan 9 (Reuters) - U.S. President Donald Trump's order for Freddie Mac and Fannie Mae to buy $200 billion in mortgage bonds raises doubts about their privatization plans, analysts say.

Fannie and Freddie, created by the U.S. Congress ?to support the housing market, have been under government control since their bailout during the ?global financial crisis of 2008.

Efforts to re-privatize the companies, including ?during Trump's first presidency, had failed to gain ?traction, but hopes of ?their long-pending privatization resurfaced following his re-election.

"Because I chose not to sell Fannie ?Mae and Freddie Mac in my First ?Term ... it is now worth many times that amount...," Trump wrote in a Truth Social post on ?Thursday.

His comments come as affordability ?becomes ?a hot political issue amid a sagging approval rating ahead of the midterm elections. The purchases are aimed at lowering mortgage ?rates and monthly payments to make housing affordable, Trump said.

"Trump praised his decision not to IPO the companies in his first term ... This does not sound like a President who is in a rush to IPO the enterprises," TD Cowen analyst ?Jaret ?Seiberg wrote in a note.

Freddie Mac and Fannie Mae did not immediately respond to Reuters' requests for comment.

The use ?of these companies to finance his ambitions serves as a negative prospect for ending the conservatorship of the companies, analysts note.

"If the GSEs (Government-Sponsored Enterprises) can serve as a funding arm for Presidential policy, we shouldn't ever expect them to be re-privatized again," JonesTrading analyst Mike O'Rourke said.

Pershing Square's Bill ?Ackman in November cast doubts about the possibility of an IPO for the companies in the short term, calling the sale of a piece "neither feasible nor desirable ?at this moment." (Reporting by Utkarsh Shetti in Bengaluru; Editing by Anil D'Silva)