Trump prepares $500 billion IPO for Fannie Mae and Freddie Mac, could fetch $30 billion — biggest in years

Fannie Mae and Freddie Mac IPO 2025: US president Donald Trump is laying the groundwork to take mortgage finance giants Fannie Mae and Freddie Mac public as his administration is preparing for the initial public offerings for these companies by the end of this year, as per a report.

Donald Trump Moves to Take Fannie Mae and Freddie Mac Public in $500 Billion IPO Plan

According to Reuters, the plans under discussion might value both companies combined at about $500 billion or even more and might even fetch $30 billion in a share sale.

Fannie and Freddie’s Role in the US Housing Market

The IPO would be a major milestone for both firms, as they have been under federal conservatorship since 2008, as per the report. Fannie and Freddie were started by Congress, with the aim of supporting the housing market by ensuring affordable mortgage financing, but they collapsed after being severely hit during the financial crisis, according to the Reuters report.


However, both companies were bailed out with the help of taxpayer funds, and the Department of the Treasury received preferred shares in return, which paid billions of dollars in dividends over the years, as reported by Reuters.

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Donald Trump's Privatization Attempts and Political Hurdles

Meanwhile, there have been attempts to return Fannie and Freddie to private control, even during Trump's first term in office, but have failed to get traction, according to the report.

Both Fannie and Freddie buy mortgages from lenders, holding them in their portfolios or bundling them into mortgage-backed securities for sale, and the cash that lenders receive from these sales fuels more lending, which ensures a steady supply of mortgage financing for homebuyers, apartment investors and other multifamily property purchasers, as reported by Reuters.

As they convert mortgages into MBS and guarantee payment of principal and interest, Fannie and Freddie lure investors into the secondary mortgage market, which increases the funds available for housing, according to the report.

Since Trump returned to the White House, there had been increased anticipation that both firms' long-pending privatisation could finally be completed, as per the report.

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Last year, even billionaire investor Bill Ackman, who has held stakes in Fannie and Freddie for over a decade, had said that he was counting on Trump to finish the job, as reported by Reuters.

According to the Reuters report, any unwinding of the government could be a complex issue because of the trillions in mortgages the companies guarantee. While the US president had also said in May that he would retain an oversight role over the firms, even if they went public, as per the report.

Following the report, Fannie and Freddie shares increased 21% each, reaching their highest in over a month, both trade over the counter, as reported by Reuters.

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Donald Trump Meets with Banking Leaders

Earlier this week, the US president had even met the CEOs of Citigroup and Bank of America to discuss the administration's plans to privatise the mortgage giants, according to the Reuters report.

FAQs

Why were Fannie and Freddie taken over by the government?
They collapsed during the 2008 financial crisis and were placed under federal conservatorship to prevent a complete housing market collapse, as per the Reuters report.

How much could the IPO raise?
The combined IPO could fetch around $30 billion and value the companies at over $500 billion, according to the Reuters report.