Fannie Mae executives said during a conference call Feb. 27 that the company's purchases of subprime credit quality loans and mortgage-backed securities may continue to grow.Fannie chief executive Daniel Mudd stressed that at year-end 2006, only about 0.2% of Fannie Mae's single-family mortgage credit book of business consisted of subprime mortgage loans or Fannie Mae MBS backed by subprime home loans. However, an additional 2% of the book of business consisted of private-label MBS backed by subprime home loans. Mr. Mudd said Fannie Mae will make prudent and incremental decisions about continuing to expand its subprime credit business. "I like where we are," he said. "We have enough engagement so far to be knowledgeable about the market, but we don't have so much that this is a major exposure on our books." He reported that cumulatively, the loan-to-value ratio on Fannie Mae's book of business is 55% and the average credit score is 721. Fannie can be found online at http://www.fanniemae.com.
