Friday, March 28, 2008

OFHEO: Fannie, Freddie May Raise $20 Billion

by Calculated Risk on 3/28/2008 09:15:00 AM

From Bloomberg: Fannie, Freddie May Raise $20 Billion, Regulator Says

Fannie Mae and Freddie Mac, the U.S. government-chartered mortgage companies, may raise as much as $20 billion in capital as part of an agreement that allows them to buy more debt securities, their regulator said.
...
``There's no specific number,'' [James Lockhart, director of the Office of Federal Housing Enterprise Oversight] said. ``There was a range of numbers. The best way is to say it's significant.'' The amount raised will be ``much more'' than the $5.9 billion of capital released by reducing the cushion, Lockhart said.
...
``The two enterprises have effectively become the mortgage market at this point,'' Lockhart said. ``Effectively they have become the lender of first, last and every resort.''