Freddie Mac Finds Its Next CEO

Freddie Mac is on the precipice of a major moment. Leading the charge will be Kenny Smith, a former executive and consultant at Deloitte.

The mortgage giant named Smith as its chief executive officer on Tuesday, according to an announcement. Smith will also join the board of directors while interim CEO Michael Hutchins will continue in his other role as president.

Smith worked at Deloitte for nearly three decades, including a term as a vice chair, though it appears he had recently been retired. He also spent a long period at Deloitte working directly with Wells Fargo.

In a statement, Smith said he was looking “forward to working with our talented team to expand access to homeownership and rental housing across the country.”

The permanent CEO job was last held by Diana Reid, who was one of the many executives ousted across Freddie and Fannie Mae when Federal Housing Finance Agency director Bill Pulte took charge.

It’s one of many changes Pulte brought to the government-sponsored enterprises, particularly at the C-suite level. A couple of months ago, Priscilla Almodovar, Fannie’s chief executive officer and president, resigned amid a broader shakeup at the organization.

The biggest change could be coming next year, however, meaning Smith is likely to play a significant role.

Fannie and Freddie are angling towards an initial public offering that could be the largest in American history.

President Donald Trump’s administration was reported this month to be pursuing a sale of shares in the two government-backed mortgage giants, which have been under federal conservatorship since their 2008 bailout. The potential public offering would reportedly value the agencies at around $500 billion and raise about $30 billion.

The stakes are undeniable: Fannie and Freddie underpin nearly half of all U.S. mortgages, so any misstep could ripple through housing markets and consumer borrowing, leading prominent figures such as Pershing Square chief Bill Ackman to urge the administration to slow its roll.