Tags: 'Serious | Problems' | Topple | Executives | Freddie | Mac

'Serious Problems' Topple Executives at Freddie Mac

Monday, 09 June 2003 12:00 AM

The government-chartered private corporation also announced the retirement of its chairman and chief executive and the resignation of its chief financial officer.

Freddie Mac Chairman Leland Brendsel, CFO Vaughn Clarke and COO David Glenn are gone after o a warning issued by the Office of the Federal Housing Enterprise Oversight, which was made public today.

The announcement sent Freddie Mac stock plummeting 14 percent and raised risk premiums on the mortgage giant's debt securities. It sent the dollar lower against all major currencies.

The Office of Federal Housing Enterprise, the federal agency charged with regulating Freddie Mac, said in a letter to the company's board of directors that the management shake-up went only "part of the way toward correcting serious problems."

Gregory Parseghian, Freddie's new president, tried to reassure investors in a rushed conference call. He said the company's assets had not diminished. He promised to resolve accounting issues as soon as possible.

Freddie Mac said the planned restatement of its earnings might be delayed until the third quarter. It previously said the restatement would be completed by the end of the second quarter.

The resignations came amid criticism Freddie Mac and companion agency, Fannie Mae, have grown too large.

U.S. Treasury securities benefited from the turmoil as investors sought safer havens.

"This is bad," said Paul Miller, an analyst at Friedman, Billings, Ramsey. "We've always felt that there was more here than met the eye, and it turns out that's exactly what it is."

Copyright 2003 by United Press International.

All rights reserved.

© 2020 Newsmax. All rights reserved.


   
1Like our page
2Share
Pre-2008
The government-chartered private corporation also announced the retirement of its chairman and chief executive and the resignation of its chief financial officer. Freddie Mac Chairman Leland Brendsel, CFO Vaughn Clarke and COO David Glenn are gone after o a warning...
'Serious,Problems',Topple,Executives,Freddie,Mac
254
2003-00-09
Monday, 09 June 2003 12:00 AM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved