Freddie Mac Reports Record $2.45B Loss

Rising defaults break mark mortgage investor set ... last quarter
By Kevin Spak,  Newser Staff
Posted Feb 28, 2008 10:27 AM CST
Richard Syron, chairman and CEO of Freddie Mac, talks about the sub-prime lending crisis and its effect on the housing market in Boston in this April 27, 2007 file photo. (AP Photo/Stephan Savoia, file)   (Associated Press)
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(Newser) – Freddie Mac, the nation’s second-largest mortgage finance company, lost $2.45 billion in 2007's fourth quarter, topping the record $2.02 billion it lost the previous quarter, Bloomberg reports. Freddie’s CEO predicted still-greater losses ahead as loan defaults take their toll, but said the company had raised enough money to weather the storm—unless things get drastically worse.

The loss of $3.97 per share was worse than expected, with analysts having forecast a $2.34 per-share drop, the Wall Street Journal reports. Freddie Mac and fellow government-backed financier Fannie Mae together account for 45% of the home loan market. Fannie yesterday reported $3.56 billion in losses. It’s “discouraging,” said one trader. “Right now, I see no relief” for housing.