Freddie Mac chief to stand down

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US mortgage giant Freddie Mac has said its chief executive David Moffett is to quit after only six months in charge.

Mr Moffett, who was appointed last year when the government effectively nationalised Freddie Mac and its rival Fannie Mae, will step down by 13 March.

Fannie Mae and Freddie Mac underwrite more than half of all US mortgages.

In February, President Barack Obama revealed a further $200bn in Treasury funding for the two companies in his plan to tackle the housing crisis.

The Obama administration has yet to decide their long-term future.

'Supporting housing market'

FREDDIE MAC & FANNIE MAE Buy mortgages from approved lenders and then sell them on to investors - rather than lending directly to borrowersGuarantee or own around half of the $12 trillion US mortgage marketAre relied on by almost all US mortgage lendersSupply funds to meet consumer demand for mortgagesLink mortgage lenders with investors - keeping the supply of money widely available and at a lower costHave no direct UK equivalent <a class="" href="/1/hi/business/7502310.stm">Q&A: Freddie Mac and Fannie Mae</a><a class="" href="/1/hi/business/7505152.stm">The importance of Freddie and Fannie </a>

Freddie Mac also reiterated its plans to ask the government for up to $35bn (£25bn) in additional aid.

It said it expected its regulator, the Federal Housing Finance Agency (FHFA), to ask the Treasury for the capital after the company files its 2008 financial results with the Securities and Exchange Commission.

Freddie Mac is expected to report its fourth-quarter results in the coming days.

James Lockhart, director of the agency, said that the FHFA "will work with the Freddie Mac board and management team to ensure a smooth transition and continuation of their important mission of supporting the housing market".

Last Friday, Fannie Mae said that it had made a loss of nearly $59bn in 2008 due to the housing crisis. It also said it needed $15.2bn in government aid.

Troubled companies

The two companies do not lend directly to homeowners, rather they buy mortgages from approved lenders and then sell them on to investors.

As a result, they are relied upon by almost all US mortgage lenders.

Over the year to September 2008, the two companies lost nearly $14bn as growing numbers of homeowners defaulted on their mortgage loans.

The huge losses led to the government bail-out.