Syron: Don't Single Us Out as System Risk

Freddie Mac's business model does not require rapid portfolio growth, and its $710 billion portfolio should not be singled out by critics as a "special source of systemic risk," according to the company's president and chief executive, Richard Syron.Freddie Mac can expand its portfolio in line with the annual growth rate of mortgage debt outstanding (which is projected to be 8% over the next few years) and still be profitable, Mr. Syron told the Money Marketeers of New York University. "We are thus able to both serve our mission and generate shareholder value by growing along with a very healthy mortgage market," he said. He also stressed that Freddie has more ways to hedge its risks and that its portfolio is "less risky" than the large portfolios maintained by a handful of banks and thrifts. "I don't believe it makes sense to single us out as a special source of systemic risk," the Freddie Mac chief executive said.