Freddie's Private MBS Buys Surge; Fannie's Dive

Freddie Mac increased its purchases of private-label mortgage-backed securities by nearly 50% in 2005, while Fannie Mae's purchases fell by 50%, according to a report by the Office of Federal Housing Enterprise Oversight."Private-label MBS purchases by Fannie Mae fell 54% by $41.1 billion, while purchases by Freddie Mac jumped 49% to $180.0 billion," the OFHEO reports says. Freddie Mac is increasing it purchases of highly rated variable-rate securities, chairman and chief executive Richard Syron told a recent investors conference. "These purchases are essential to meeting our housing goals, and they also provide good financial returns," he said. The OFHEO mortgage market report also points out that combined MBS issuance by Fannie and Freddie fell 1%, to $908 billion, in 2005 -- the lowest level in five years.