Recent earnings of Federal National Mortgage Association were listed incorrectly yesterday. The company earned $75.5 million in 1983, $22 million in 1984's first quarter and $2.4 million in the second quarter.
Robert J. Mylod announced his resignation as president and chief operating officer of the Federal National Mortgage Association yesterday, less than two years after he joined the corporation.
Mylod, 44, said he wants "to be in an entrepreneurial environment . . . where I would have a chance to develop an equity stake in a company I was running."
Although his tenure at Fannie Mae has been short, "In one sense . . . it's been a long enough time for me to figure out that this isn't really the appropriate spot for me," he said.
David O. Maxwell, chairman and chief executive office of Fannie Mae, as the corporation is known, is expected to announce a replacement within two to three weeks, Mylod said. He added that he will stay on for several months to ensure a smooth transition.
Maxwell said the new president will come from outside the corporation.
Fannie Mae, a federally chartered organization, buys mortgages from lenders, making cash available for more loans. It then packages the mortgages into securities for sale in the secondary mortgage market.
The company has been losing money for much of the last four years while "people in the mortgage security business are getting incredibly rich," said an industry source, who estimated that Mylod could "quadruple or quintuple" his earnings. Mylod would not divulge his salary, but one source estimated it at "in excess of $250,000."
Mylod said he is "talking to several people . . . about a venture that would involve raising capital and investing in a financial services corporation," but would not divulge details. Mylod and his wife, who is from the Washington area, have six children, five of whom are in area schools, and would like to remain here, he said.
Mylod joined Fannie Mae after eight years as president and chief executive officer of Advance Mortgage Corp. in Detroit. When Advance was absorbed by Lomas and Nettleton Financial Corp. of Dallas, the country's largest mortgage banker, Mylod could have gone to Dallas as one its senior officers, but went to Fannie Mae instead.
Fannie Mae lost $21.6 million in the second quarter of this year, in part because rising rates forced it to pay more interest on money it borrowed that it charged on mortgages. Its earnings dropped from $22 million in the first quarter of 1984 to $2.4 million in the second quarter. The company earned $37 million in 1983 after skyrocketing interest rates had helped cause $295 million in losses during the recession of 1981 and 1982.
Additionally, Fannie Mae's attempts to loosen the federal regulations that constrain its operations have been unsuccessful, while recently passed legislation has reduced restrictions on private issuers of mortgage-backed securities.
Mylod, who played a major role in operational changes in Fannie Mae, said he has "pushed very hard to see that Fannie Mae got out on the power curve of the whole technological revolution."
He has been a leader in development of a new $30 billion computerized system that will start up next year. It will dramatically simplify and streamline operations with Fannie Mae's lender clients, according to a company spokesman.
Corporation Chairman Maxwell said he "deeply" regrets Mylod's decision to leave, but said "I can fully understand and appreciate his desire to further his career goals."
His departure "has absolutely nothing to do with anything at Fannie Mae or the relationships here," said Mylod. He said he and Maxwell "have had an excellent relationship . . . "