Fannie Mae (FNM) Capital Position Better Than Perceptions - Lehman
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According to a Reuters report, a Lehman Brothers analyst said Fannie Mae's (NYSE: FNM) capital and reserves positions are better than market expectations and the company may not need to raise more capital.
The analyst said Fannie could get through this difficult cycle with its core capital above its 15% excess capital requirement. Also, regulator could lower the excess capital requirement further.
Both Fannie Mae and sister GSE Freddie Mac (NYSE: FRE) have seen volatile trading action on fears the U.S. Treasury would have to provide capital to the companies, which could wipe out common shareholders. Shares of both GSEs are down over 90% over the past year.
The analyst said Fannie could get through this difficult cycle with its core capital above its 15% excess capital requirement. Also, regulator could lower the excess capital requirement further.
Both Fannie Mae and sister GSE Freddie Mac (NYSE: FRE) have seen volatile trading action on fears the U.S. Treasury would have to provide capital to the companies, which could wipe out common shareholders. Shares of both GSEs are down over 90% over the past year.
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