The Federal Housing Finance Agency said Thursday it would stop making quarterly classifications of capital adequacy at Fannie Mae and Freddie Mac while the government-sponsored enterprises operate under conservatorship.
The agency said the public could still judge Fannie and Freddie’s capital by reviewing data in their quarterly and annual reports with the Securities and Exchange Commission.
In the months leading up to the government takeover, FHFA Director James Lockhart insisted both GSEs were well capitalized. But he said Thursday that they were undercapitalized as of June 30 and were weighed down by safety and soundness weaknesses, especially related to credit risk. Fannie and Freddie were also hampered by a weak earnings outlook and deterioration in equity, debt and mortgage-backed securities markets, he said.