Posted on 11/14/2008 6:16:32 AM PST by DeaconBenjamin
NEW YORK (Reuters) – Freddie Mac, the second-largest provider of funding for U.S. residential mortgages, said on Friday it lost $25.3 billion in the third quarter as it wrote down a tax-related asset that had buoyed its capital and the housing slump took a significant turn for the worse.
Freddie Mac's loss equaled $19.44 per share, compared with a loss, before preferred dividend payments, of $1.24 billion, or $2.07 per share, a year earlier.
The loss pushed the company's net worth to a negative $13.7 billion at the end of the third quarter, and shareholder equity to a negative $13.8 billion.
The government placed Freddie Mac (FRE.P) and its larger rival Fannie Mae (FNM.P) under conservatorship in September, pledging to inject capital as needed for the companies to operate and help stabilize the housing market. The companies' regulator has submitted a request for the Treasury Department to provide $13.8 billion for Freddie Mac to erase the shareholder equity deficit.
Freddie Mac said it expects to receive the money from Treasury by November 29.
Deteriorating conditions in the U.S. housing market led Freddie Mac to boost its provision for credit losses to $5.7 billion in the third quarter from $2.5 billion in the second quarter. It also recorded $9.1 billion in write-downs on securities and $6.0 billion in other credit-related expenses, guarantee assets and derivatives, up from a $481 million loss in the previous period.
The government took Freddie Mac and Fannie Mae on concern that mortgage losses were eroding the capital they needed to operate as the top funders of residential loans. The companies together own or guarantee nearly half of all U.S. mortgages.
(Excerpt) Read more at news.yahoo.com ...
I guess the good news is that consumer spending is way off.
The taxpayers suer made money on this one! [/sarcasm]
"The taxpayers' sewer." As good a description as any.
At the current rate of bailouts, I am not sure there will be any money left in the US treasury on November 29.
Out of the keyboards of inaccurate typers ...
>Now there’s a plan for success...or is it a train wreck waiting to happen?
In a word: Yes.
It is proof that your tagline is insulting... to the soup.
I don’t see the problem here, just give them more money, print it if we need to, its all good. /sarc
No - your analysis assumes that they will not lose more money between now and then.
I stand corrected. There are so many more profitable avenues for this money to go it’s mind boggling.
Is this before or after the Democrats filled their pockets with taxpayer money?
I’m wondering if Barney Frank still thinks there is no crisis at Fannie and Freddie, like he said in 2004 while a member of the House Financial Services Committee...
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