Fannie Mae
Table of Contents
Introduction………………………………………………………………………………………..3
History……………………………………………………………………………………………..3
Business Method and Philosophy…………………………………………………………………4
Corporate Growth and Diversity.…………………………………………………………………6
Conclusion………………………………………………………………………………………...7
References…………………………………………………………………………………………8
Figure Chart 1……………………………………………………………………………………10 Fannie Mae Fannie Mae is a leading mortgage company and one of the most financially successful businesses within its industry. Given the salient features of the organization that has culminated into its current standing, this report offers a brief but concise overview of the corporation. The organization began as a part of Roosevelt’s New Deal, a program initiated by the onslaught of worldwide economic depression in the 1930s and the complete collapse of the housing market. Chartered by Congress as the Federal National Mortgage Association in 1938, the organization’s principal mission was to encourage home ownership by providing local banks with money and ensuring the residential mortgage market is well funded by the creation of a secondary mortgage market (Cottle 1998, Allie Mae 2004). In 1968 Lyndon B. Johnson transformed Fannie Mae into a “government sponsored enterprise” (GSE) due to the company’s complete monopolization of the second mortgage market (Cottle 1998). Cottle explains that, “as a GSE, the company is subject to congressional oversight and certain limitations on its activities, but it nonetheless is a privately operated, publicly traded, for-profit corporation charged with making money for its shareholders” (p. 18). The U.S. president gets to appoint several board members, and the U.S. Treasury Department approves Fannie Mae 's debt issuance. And it has approved and approved and approved. Fannie Mae and Freddie Mac have virtually unlimited access to capital, at funding costs that are below the rates otherwise available on the market. In layman’s terms, this means
Introduction………………………………………………………………………………………..3
History……………………………………………………………………………………………..3
Business Method and Philosophy…………………………………………………………………4
Corporate Growth and Diversity.…………………………………………………………………6
Conclusion………………………………………………………………………………………...7
References…………………………………………………………………………………………8
Figure Chart 1……………………………………………………………………………………10 Fannie Mae Fannie Mae is a leading mortgage company and one of the most financially successful businesses within its industry. Given the salient features of the organization that has culminated into its current standing, this report offers a brief but concise overview of the corporation. The organization began as a part of Roosevelt’s New Deal, a program initiated by the onslaught of worldwide economic depression in the 1930s and the complete collapse of the housing market. Chartered by Congress as the Federal National Mortgage Association in 1938, the organization’s principal mission was to encourage home ownership by providing local banks with money and ensuring the residential mortgage market is well funded by the creation of a secondary mortgage market (Cottle 1998, Allie Mae 2004). In 1968 Lyndon B. Johnson transformed Fannie Mae into a “government sponsored enterprise” (GSE) due to the company’s complete monopolization of the second mortgage market (Cottle 1998). Cottle explains that, “as a GSE, the company is subject to congressional oversight and certain limitations on its activities, but it nonetheless is a privately operated, publicly traded, for-profit corporation charged with making money for its shareholders” (p. 18). The U.S. president gets to appoint several board members, and the U.S. Treasury Department approves Fannie Mae 's debt issuance. And it has approved and approved and approved. Fannie Mae and Freddie Mac have virtually unlimited access to capital, at funding costs that are below the rates otherwise available on the market. In layman’s terms, this means
References: Annual Report. (2003). Fannie Mae. Retrieved March 28, 2007 from http://www.fanniemae.com/ir/pdf/annualreport/2003/2003annualreport.pdf Allie Mae Career Builder. (2006). Fannie Mae jobs. Retrieved March 28, 2007 from http://www.careerbuilder.com/JobSeeker/Companies/CompanyJobResults.aspx?Comp_DID=C37NC75JNJKDCBJD5T&cbRecursionCnt=1&cbsid=4525fce561ac4f6faa36b96c12959154-202825595-S2-1 Cottle, M. (1998, June). Nice work if you can get it: How Fannie Mae became Washington 's biggest power player. Washington Monthly. 30(6), 18-20 Fannie Mae