As the White House and Treasury continue to work on their recommendations to revamp the housing finance system — in particular, the GSEs — a new round of layoffs has begun at Freddie Mac with cuts soon coming at Fannie Mae, according to GSE and other officials.
Freddie Mac declined to comment about layoffs, while a Fannie spokeswoman recently noted that, "We don't comment on administrative matters. That said, the company is committed to being good stewards of the government's resources and therefore, regularly reviews its operations to improve efficiency."
A Freddie Mac source who was terminated said, "They let a bunch of us go" but could offer no hard numbers. The target number is said to be in the range of 200 workers over the next few months, said sources. Severance packages were granted to those let go.
According to their profiles on YahooFinance, Fannie employs 6,000 workers, Freddie 5,300.
Sources told National Mortgage News that both these secondary market giants — wards of the government since September 2008 — have been told to reduce their general and administrative (G&A) costs by at least 10% for the new year. But where that directive came from is unclear. A spokeswoman for the Federal Housing Finance Agency declined to comment on the matter.
Meanwhile, industry officials that have been privy to some of the talks going on at Treasury regarding the GSEs said one idea being discussed is merging the two into one company.