Fannie Mae has priced two private offerings of noncumulative preferred stock totaling $5 billion as part of a plan to rebuild its capital base.The securities sale to institutional investors should make up for a capital shortfall so that the company can meet its minimum regulatory capital requirement. The Office of Federal Housing Enterprise Oversight recently classified the giant mortgage company as "significantly" undercapitalized. "This placement of preferred stock is a key component of Fannie Mae's capital restoration plan," said Donald Marron, a member of Fannie's board who is working with OFHEO on the plan. "We will be finalizing the details of the capital plan shortly." Besides meeting its minimum capital requirement, Fannie also has to build a capital surplus of 30% above its minimum requirement. Lehman Brothers Inc. served as the sole placement agent for the stock placements, which involved a $2.5 billion, 5.375% convertible preferred stock series and a $2.5 billion nonconvertible floating-rate preferred stock series with an original coupon of 7%. The conversion price to Fannie Mae common stock is $94.31 per share. Fannie Mae can be found on the Web at http://www.fanniemae.com.
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Ohio-based Liberty Home Mortgage joins several companies who started using a more modernized FICO credit score for nonconforming mortgage originations recently.
1h ago -
The CFPB has dissolved the Office of Supervision, Enforcement and Fair Lending and eliminated the job of associate director in a move that impacts how it designates nonbanks for supervision.
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The plan that the Federal Housing Finance Agency floated calls for Freddie Mac to actively invest in some new closed-end seconds as cash-out refinancing subsides.
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The push comes amid what one expert highlighted as lax funding efforts for two Department of Housing and Urban Development grant programs.
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Conventional lending drove volumes higher, particularly in the purchase market, the Mortgage Bankers Association said.
April 17 -
Net charge-offs at the Charlotte, North Carolina-based bank increased by more than 80% in the first quarter compared with a year earlier. BofA executives say that the rising losses were in line with the bank's risk appetite.
April 16