WASHINGTON - The regulator for Fannie Mae and Freddie Mac said it is on track to complete its risk-based capital rule for the government-sponsored mortgage buyers by yearend.

Armando Falcon Jr., director of the Office of Federal Housing Enterprise Oversight, wrote in a July 11 letter to Rep. Richard H. Baker, R-La., that the agency has completed a review of all the comments it received on the proposed rule.

"The only task remaining now is to draft the final rule and carefully revise the computer model which runs the stress test," Mr. Falcon wrote.

Once that is done, he said, the office will submit the rule to the Office of Management and Budget for final clearance and publication in the Federal Register.

The oversight office was created in 1992 by Congress, which told the agency to have the rule in place by January 1995. But the office did not even issue a proposal until February 1999. After two extensions the agency set a March 10, 2000, deadline for comments.

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