Fannie Mae taps Treasury for further $19bn - FT.com
By Saskia Scholtes in New York
May 8 2009 15:04Fannie Mae said on Friday it would draw a further $19bn of assistance from the US Treasury after a seventh consecutive quarterly loss – $23.2bn in the first quarter – drove its net worth below zero.
Fannie said it expected more red ink in future quarters, which would require further help from the government. The company added that its role as programme administrator for the government’s housing market rescue would likely have an adverse effect on the company’s financial condition.
The group sold $15.2bn of preferred stock to the US Treasury in March to cure its fourth quarter net worth deficit.
Fannie and Freddie, which own or guarantee almost half of US residential mortgage debt, have become central to President Barack Obama’s plan to help avoid foreclosures. In February, the Treasury doubled its emergency capital commitment for each company to $200bn.
read article here… FT.com / US / Economy & Fed – Fannie Mae taps Treasury for further $19bn.
Incremental steps that go without notice by the public… much like the “how to boil a live frog”… joe
