Fannie, Freddie Share Prices Hit 10-Year Lows

Washington Post (11/20/07) P. D4; Tyson, JamesInvestors concerned about increasing losses from mortgage defaults sent stock in Fannie Mae and Freddie Mac to the lowest level in 10 years. Shares of Fannie Mac closed at $37.58 for a decline of 7.6 percent and those of Freddie Mac ended the day at $37.50, down 7.9 percent, as both mortgage finance giants saw their stocks slip to their lowest prices since 1997. Investors are uncertain how many bad loans Freddie Mac and Fannie Mae own or have guaranteed. On Nov. 9, 2007, Fannie Mae said conditions in the housing market were responsible for the doubling of its net loss in the third quarter; and a Credit Suisse analyst has warned that Freddie Mac may be forced to deplete some of its excess capital to cover losses and pay a dividend.