Freddie Not Asking for Cap Increase -- Yet

Freddie Mac has not yet asked its regulator for permission to increase its portfolio caps in the wake of a widening liquidity crisis in the nonconforming sector, industry sources have told MortgageWire.A Freddie Mac spokeswoman declined to comment on the matter. However, in a June conference call with analysts, Freddie Mac chief financial officer Buddy Piszel reported that the government-sponsored enterprise is "beginning" to have discussions with its regulator in regard to its portfolio caps. (Mr. Piszel's comments were made before the nonprime sector's liquidity worsened.) At the end of June, Freddie's on-balance-sheet holdings totaled $720 billion, about $20 billion shy of its cap. MW and other news media outlets reported Aug. 6 (see item above) that Fannie Mae -- reacting to the requests of its seller/servicers -- recently asked its regulator for permission to increase its on-balance-sheet holdings in order to provide liquidity to the secondary mortgage market. Freddie Mac can be found online at http://www.freddiemac.com.