Fannie and Freddie Defy Obama, Look Invincible

Fannie Mae and Freddie Mac article updated from 5:29 pm Monday to include comments from KBW analyst Brian Gardner in second and 12th paragraphs.

NEW YORK ( TheStreet) -- Just a couple of years ago it looked like no one in Washington wanted to let Fannie Mae ( FNMA) and Freddie Mac ( FMCC) live, but the government sponsored entities (GSEs) have lately found defenders in unlikely places and are even showing signs of being independent of the Obama Administration.

"We think the prospects of Fannie Mae's and Freddie Mac's survival are greater than we previously estimated," wrote KBW Washington analyst Brian Gardner in a report published Tuesday.

The surprising resilience of the mortgage giants comes ahead of a scheduled vote in the Senate Banking Committee Tuesday on legislation sponsored by Sens. Tim Johnson (D., SD) and Mike Crapo (R., ID) aimed at winding down Fannie and Freddie, a stated goal of President Obama.

While the bill is expected to pass the Senate Banking Committee with at least 12 votes, it will likely require approval from 15 of the 22 committee members to have a chance at passing the full Senate, argues FBR Capital Markets analyst Ed Mills in a report published Monday.

Even then, passage in the House is seen as a near impossibility given that House Financial Services Committee Chairman Jeb Hensarling (R., Texas) has sponsored his own housing reform legislation which, as Mills describes it "fully privatizes the housing industry." While the Johnson Crapo bill winds down Fannie and Freddie, it still leaves a large role for the government.

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