Fannie Mae, which is struggling through an $11 billion accounting scandal, on Wednesday afternoon named one of its own, interim CEO Daniel Mudd, to be its permanent chief executive and president. The appointment by Fannie's board drew immediate praise from acting Office of Federal Housing Enterprise Oversight director Stephen Blumenthal who said Mr. Mudd has "played a key role in the transformation of Fannie Mae and I look forward to continuing the development of a strong, constructive relationship between Fannie Mae and OFHEO." National Mortgage News reported two weeks ago that Mr. Mudd was actively lobbying for the job and it was between him and one or two other commercial banking executives. Promoted from vice chairman/chief operating officer, Mr. Mudd became the interim head of the mortgage giant in late December when Fannie's board forced out its politically well connected chairman and CEO Franklin Raines. Some in the industry expressed surprise that the board would name Mr. Mudd because he served in Fannie's office of the chairman along with Mr. Raines. GSE critic Bert Ely said in a statement, "However qualified Dan Mudd may be to run Fannie Mae, his appointment this afternoon as Fannie's new CEO is, at the least, incredibly, naively impolitic. At worst, it represents the height of political arrogance that may come back to haunt Fannie, and Freddie, too, as Congress continues to masticate...on GSE regulatory reform legislation."
