Freddie Mac, the swamped mortgage giant seized by the government two months ago, asked for $13.8 billion from the Treasury today after a record quarterly loss plunged its net worth into the negative, Bloomberg reports. Sister company Fannie Mae, also under government control, said this week it might need funds beyond the $100 billion previously earmarked for each of the firms before the end of the year.
"You could very well get losses north of $100 billion on both of these companies,'' an analyst tells Bloomberg. Freddie’s third-quarter net loss grew to $25.3 billion after writedowns on bad mortgage and securities bets pushed the firm to insolvency. Total credit expenses were up more than double the previous quarter's, swelling from $2.8 billion to $6 billion. Freddie’s stock value has plummeted from $22 billion at the beginning of the year to $2.3 billion yesterday; Fannie has experienced a similar precipitous fall.