Industry News

Dodd urges regulators to consider unleashing Fannie, Freddie

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The chairman of the influential Senate Banking Committee is urging regulators to consider lifting caps on the loan portfolios of mortgage repurchasers Fannie Mae and Freddie Mac. In a statement issued Tuesday, Sen. Christopher Dodd, D-Conn., said Fannie's and Freddie's role of helping provide credit to low- and middle-income borrowers is "particularly important," given the ongoing contraction in the flow of mortgage credit. "For that reason, it may be appropriate, consistent with safe and sound practices as determined by the regulator, to ease the temporary regulatory cap on Fannie and Freddie's mortgage portfolio," Dodd said. Caps on the lending portfolios of the government-sponsored entities, or GSEs, were put in place in the wake of accounting and management scandals at both companies. Regulators at the Office of Federal Housing Enterprise Oversight (OFHEO) have continued to push for tight controls on Fannie and Freddie's portfolios, saying the lenders pose a "syste...