Fannie Mae and Freddie Mac, two government-run home-mortgage agencies that have long attracted the ire of Republicans and conservatives in Congress, are looking at having their executive pay clipped. While the senior executives at Fannie and Freddie currently makes up to $6 million, the Republicans are backing a bill which will cap their salaries according to a government rubric for salaries–which is capped at $199,700. That’s quite a pay decrease.
Fannie and Freddie were taken over by the government through a legal process known as conservatorship in September 2008. So far, the companies have taken $112 billion in government aid to stay afloat, and they are likely to incur larger losses as defaults rise on mortgages that they own and guarantee.
Last month, the companies’ regulator, the Federal Housing Finance Agency, approved compensation packages for senior executives of both companies. While some senior executives could receive multi-million-dollar pay packages, the agreements capped pay for other officers at $500,000.
More on both the political and business implications of this bill here.
Fannie and Freddie Get Haircuts
Fannie Mae and Freddie Mac, two government-run home-mortgage agencies that have long attracted the ire of Republicans and conservatives in Congress, are looking at having their executive pay clipped. While the senior executives at Fannie and Freddie currently makes up to $6 million, the Republicans are backing a bill which will cap their salaries according to a government rubric for salaries–which is capped at $199,700. That’s quite a pay decrease.
More on both the political and business implications of this bill here.