Yawn - more of the same: Freddie and Fannie
From
Yahoo/Reuters:
Freddie Mac posts $5 billion loss
Freddie Mac the second largest provider of U.S. residential mortgage funding, on Friday posted a loss of $5 billion in the third quarter and predicted it would need more government support amid a "prolonged deterioration" in housing.
Increases in the value of securities Freddie Mac held over the period helped buoy its net worth, however, erasing its need to tap government funds for a second straight quarter to stay solvent while continuing to buy and guarantee home loans.
Including a $1.3 billion dividend payment on senior preferred stock bought by the Treasury in previous quarters, Freddie Mac's third-quarter loss increases to $6.3 billion.
The home funding company's loss comes amid a rise in provisions for credit losses to $7.6 billion in the quarter, up 46 percent compared with the previous quarter, as delinquencies worsened on loans it guarantees. Provisions will remain high this quarter, it added.
"I would say we are just beginning to see the impact of the chargeoffs on their guarantee book," said Janaki Rao, vice president of mortgage research at Morgan Stanley in New York.
Its larger rival Fannie Mae on Thursday said it would need $15 billion from the U.S. Treasury after a whopping $18.9 billion third-quarter loss.
Results at Freddie Mac and Fannie Mae are widely watched as a barometer of the U.S. housing market since they own or back nearly half of outstanding mortgages.
What the fuck are these assholes smoking and keep that bad shit away from me.
Is there no one left on the East Coast who knows how to run a business?
They got themselves into this swamp, they need to figure out a way to get out of it (hint: bankruptcy and reorganization) and reincarnate as a lean and mean mortgage machine. It can be done but I am beginning to understand that the ability to do this is so far above the upper management's pay grade that their last toot of cocaine would come screaming out of their navels just thinking about it.
Posted by DaveH at November 6, 2009 11:17 PM
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