Another Leg of Freddie Mac's Long Relay
Monday, August 3, 2009
Freddie Mac Chairman John Koskinen has served as interim chief executive of the mortgage giant since March, when he stepped in after the resignation of the first chief executive appointed under government control.
Koskinen, a former Clinton administration official and deputy mayor of the District, has led Freddie Mac as it tries to carry out the Obama administration's mandate for reviving the housing market by adjusting mortgage terms to reduce foreclosures and buying up home loans to help reduce interest rates.
He has also worked to balance the interests of an array of constituencies: lawmakers, investors and regulators. The company has posted billions of dollars in losses and received more than $50 billion in government aid.
Next month, Koskinen will drop his CEO responsibilities when Charles E. Haldeman takes office. The Washington Post spoke with Koskinen about Freddie Mac and its role in the mortgage market. Here is an edited excerpt of that discussion:
Q As the head of one of the nation's largest mortgage companies, you have a broad sense of the housing market. What do you see happening?
A As you can see by the numbers that have just come out . . . either the rate of decline has slowed or we've seen some pick-up in prices. . . . The worst is clearly behind us. I think by the end of the year, people will feel more optimistic about the housing market.
What do you consider your chief accomplishment?
We renewed a sense of enthusiasm and optimism with the employees about the future. I started a little over four months ago as the CEO and then we had the unfortunate death of [acting chief financial officer] David Kellermann and that came on top of the [government seizure of Freddie Mac.] Obviously that was a major set of challenges for people. The most important thing was getting the entire workforce . . . a renewed sense of optimism that we are going to get through the challenges.
What have been the key programs Freddie Mac has worked on?
We're a critical component of the president's 'Making Home Affordable' program, which is designed to keep people in their homes as part of the process to restore the economy to where it was before this great challenge confronted everybody. . . .
We're just at about a stage where you're going to start to see a significant number of [mortgage] modifications, which is going to keep people in their homes when otherwise they'd had go to through foreclosure.
How many mortgage modifications have there been?