Federal Deposit Insurance Corp. Chairman Sheila Bair defended loan modifications Wednesday, arguing that data released by other regulators was insufficient to cast doubt on their success.

Comptroller of the Currency John Dugan previewed data last week that said more than half of borrowers who received a loan modification in the second quarter were late on their payments within six months.

But Ms. Bair said the figures defined modifications broadly and left out loans restructured by Fannie Mae and Freddie Mac as part of an effort announced last month.

"The report simply defines a modification as any change in contract terms. Many past modifications were simply short-term fixes that did not create a sustainable payment for borrowers," she said in a speech to the New America Foundation.

She added that Mr. Dugan has agreed that "sustainable modifications should perform much better."

Ms. Bair also took issue with the report's contention that a borrower who misses one payment is delinquent, saying the more common standard is 60 days past due.

"Media stories unfortunately focused on delinquencies after only 30 days," she said. "While those made for big numbers, the 60-day delinquency figure reported by the OCC was much lower, around 35%, and generally the industry defines redefault or distress for delinquencies that at least go 60, if not 90, days.

"Experience shows that a large percentage of 30-day delinquent mortgages will become current again."

In a statement, Mr. Dugan responded: "Whether we look at delinquencies of 30 or 60 days, redefault rates on loan modifications are higher than we would hope or expect."

"While it's plausible to speculate that inadequate loan modifications are the primary cause, we don't yet know whether that's the case or whether other factors are at work," he said. "Sorting this out is one of the things we will be focusing on in the next round of data collection."

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