Fannie Mae Exec Says Pain to Persist

Submitted by Ronald Tennant with Metrocities Mortgage:

Arkansas Democrat-Gazette (05/21/08) ; Kopecki, Dawn
Fannie Mae shareholders willing to assume losses in the short term will benefit when the housing market rebounds and the government-sponsored enterprise (GSE) sees a boost in earnings, said Fannie Mae CEO Daniel Mudd at the firm's annual meeting. He remarked, "[Fannie Mae] has the best opportunity in years to grow and add shareholder value, simply by doing our job. That job is to stay in the market while others have fled and keep money flowing from investors to housing." In response to the passage of a GSE overhaul bill by the Senate Banking Committee, Mudd underscored the importance of the legislation taking both the GSEs' public mission and their profitability into account to ensure that they can continue to prop up the mortgage market. Under the measure, Fannie Mae and Freddie Mac must contribute 4.2 basis points of new business volume each year to the government, amounting to what Freddie Mac CFO Anthony Piszel considers a manageable amount of $175 million per year.