Fannie Mae / FNM

About Fannie Mae

3900 Wisconsin Ave. NW, Washington, D.C. 20016
www.fanniemae.com | 202-752-7000 | Founded: 1938

Industry: Financial Services | Category: Top 100 Companies

Fannie Mae, the Federal National Mortgage Association, opened 2005 with a new interim chief executive and orders from federal regulators to restate $10.8 billion in earnings. The board of directors also imposed an unofficial mandate to reverse long-standing perceptions of the company as arrogant.
Daniel H. Mudd, who was chief operating officer and later promoted to chief executive, set about mending relations with housing industry partners and congressional overseers. During a Senate hearing in April, Mudd apologized to Congress for the company's accounting scandal, presenting a contrast to his predecessor Franklin D. Raines's last appearance before Congress several months earlier. A defiant Raines had said federal regulators who accused the company of accounting violations had "no facts."
Fannie Mae scaled back its extensive lobbying operation, canceling contracts with six K Street firms and laying off 20 lobbyists and publicists who had helped oversee a national network of more than 50 "partnership offices."
Over the course of the year, the company worked to clean up its books and, in the process, uncovered further accounting issues.
In terms of its business, the company has had to whittle down its holdings of mortgages and mortgage-backed securities to build capital to cover costs stemming from the restatement. Until the accounting scandal, the portfolio had generated a majority of Fannie Mae's profit.
The fate of the portfolio is at the center of the debate on Capitol Hill over how to better regulate Fannie Mae and its smaller rival Freddie Mac, which is emerging from its own accounting scandal.
Critics of the company, including the White House and Alan Greenspan, who was Federal Reserve chairman at the time, called on Congress to force Fannie Mae and Freddie Mac to shrink their investment portfolios, which they said grew so large as to threaten the stability of the financial system if they were to fail. The House passed a bill creating a stronger regulator, but Greenspan and the Bush administration said the bill was too weak. They supported a pending Senate bill that would force the companies to shrink.
Lawmakers are likely to resume debate on how to better regulate the two companies later this year, spurred on by the recent release of a report on Fannie Mae's accounting problems that was commissioned by the board of directors. That report, compiled by a team led by former senator Warren B. Rudman, did not uncover any further significant accounting problems and laid most of the blame for the accounting failures on former chief financial officer J. Timothy Howard and former controller Leanne G. Spencer.
However, Rudman's report looked into allegations raised in 2004 by the Office of Federal Housing Enterprise Oversight. That office is still working on its examination and is expected to issue another report.

Chairman : Stephen B. Ashley

Chairman : Daniel H. Mudd

2007 Financial Data

Total employees: 5,493 | Local employees: 4,531