debt ratios for fannie mae freddie mac loans 2015

They use the money to fund the portfolios and securities that lawmakers have increasingly relied on to support the ailing housing market. The companies combined have about $1.6 trillion in debt outstanding, much of which is held by central banks around the world. Fear spread across financial markets after the government offered no hint that it would step in to help the companies. Speculation that mounting losses at Fannie Mae and Freddie Mac would require billions of dollars in additional capital have fueled a firestorm of criticism this week, sending stock investors fleeing. They also have massive investment portfolios of home loans and MBS. The companies hold charters from Congress to raise money from investors by purchasing home loans and pooling them into mortgage-backed securities. housing market since they own or guarantee more than $5 trillion in mortgages. The health of Fannie Mae and Freddie Mac is seen as synonymous with the U.S. Treasury debt, which slumped, investors said. “It’s a credit-quality upgrade.”īut that also means a credit-quality downgrade for U.S. government than ever before,” said Jim DeMasi, chief fixed income strategist at Stifel Nicolaus & Co. “There’s a closer linkage today with Fannie, Freddie and the U.S. It was the most extreme narrowing of yield spreads ever, UBS Securities said in a report. The gapping eased to about 20 basis points, to 0.8 percentage point above Treasury notes, marking “unbelievable” shifts in a market that typically sees 1 to 2 basis point daily moves, a trader at a top-five bond dealer said in an e-mail. Yield spreads on the corporate “federal agency” debt of the companies tightened as much as 29 basis points for five-year issues, according to broker GovPX/Garban-ICAP. Investors were selling shares of the congressionally chartered companies and buying their debt, which if assumed by the government would be seen as safe as Treasury bonds, said Michael Kastner, head of fixed-income at Sterling Stamos Capital Management in New York. The prospects, sparked by deep consternation over the ability of the companies to survive on their own and a New York Times report saying the government is mulling a takeover, caused investors to flee the companies’ stock, which some analysts said could be left worthless. NEW YORK (Reuters) - Debt of Fannie Mae and Freddie Mac soared in their best one-day gain in history on Friday amid speculation that a government takeover of the housing giants would make the bonds more like ultra-safe U.S.

Debt ratios for fannie mae freddie mac loans 2015