Freddie Mac seeks no new government aid; posts quarterly loss of $374 million

Freddie Mac avoids more gov’t aid

WASHINGTON — Freddie Mac escaped the second fiscal quarter without asking the government for any new financial aid, but still expects to need more federal help in the future.

The government-controlled mortgage finance company posted a quarterly loss of $374 million, or 11 cents a share, including $1.1 billion in dividends paid to the government.

Excluding those payments, the company would have earned $768 million. In the year-ago period Freddie lost $1.05 billion, or $1.63 a share. Revenue totaled $7.5 billion versus $1.6 billion.

The company was able to maintain a positive net worth of $8.2 billion in the quarter ended June 30. As a result, it did not need to seek funding from the Treasury Department, which has provided Freddie Mac with $51 billion since the takeover last September.

The government has pledged up to $400 billion in aid for Freddie Mac and its sibling Fannie Mae. The two companies play a vital role in the mortgage market by purchasing loans from banks and selling them to investors. Together, they own or guarantee almost 31 million home loans worth about $5.4 trillion. That’s about half of all U.S home mortgages.

“While we are seeing some early signs pointing to a housing recovery — including a modest uptick in house prices in some markets — our outlook remains cautious due to rising foreclosures, growing unemployment, tight lending standards and buyers’ reluctance to re-enter the market,” John Koskinen, Freddie Mac’s interim CEO, said in a statement.