Steve Mnuchin: Time to Jettison Fannie Mae, Freddie Mac

President-elect Trump’s choice for Treasury Secretary, Steve Mnuchin, said he believes it’s time to privatize mortgage lenders Fannie Mae and Freddie Mac.

“It makes no sense that these are owned by the government and have been controlled by the government for as long as they have,” said Mnuchin, a former Goldman Sachs (NYSE:GS) executive and Hollywood producer, during an interview on the FOX Business Network’s Mornings with Maria.

He added, “In many cases this displaces private lending in the mortgage markets and we need these entities that will be safe. So let me just be clear— we’ll make sure that when they’re restructured they’re absolutely safe and they don’t get taken over again. But we gotta get them out of government control.” Billionaire Wilbur Ross, Trump's pick for Commerce Secretary, echoed Mnuchin's concerns about the mortgage lenders during the interview.

Ticker Security Last Change Change %
FNMA FANNIE MAE 1.52 -0.72 -32.14%
FMCC FREDDIE MAC 1.41 -0.82 -36.77%

Shares of both companies rallied on his comments.

Mnuchin promised that he’ll execute the separation “reasonably fast”.  Fannie and Freddie have been toiling within the U.S. government since getting bailed out during the height of the financial crisis to the tune of nearly $200 billion.