Freddie Mac to bolster capital requirements

Freddie Mac has announced it will sell $6 billion in preferred stock, in a bid to restore regulator and investor confidence and avoid breaching minimum capital requirements. In addition to the sale, the government-sponsored entity (GSE) has also slashed its dividend by 50% to just 25 cents to boost dwindling reserves following large losses announced in November.

The GSEs have had a tough third quarter, with Freddie and sister GSE Fannie Mae recording losses of $2.02 billion and $1.4 billion

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