Freddie Mac - can you spare $2 billion friend?
Freddie Mac is in need of more capital while Countrywide Financial Corp. says it is liquid. And problems at Option One Mortgage Corp., which could soon be shut down, led to yet another executive casualty.
Freddie announced today several actions to help shore up capital in response to a $2 billion third quarter loss. It has retained Goldman Sachs and Lehman Brothers as financial advisors to help with near term capital requirements and may cut its fourth quarter dividend in half.
“If these measures are not sufficient to help the company manage to the 30 percent mandatory target capital surplus, then the company may consider additional measures in the future such as limiting growth or reducing the size of our retained portfolio, slowing purchases into our credit guarantee portfolio, issuing additional preferred or convertible preferred stock and issuing common stock,” Freddie stated.
Filed under: Freddie Mac
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