DeMarco, who ran Fannie Mae / Federal National Mortgage Association (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC)’s regulator on an acting basis for nearly five years, will leave FHFA next month.
He remained at FHFA as a deputy director after Melvin L. Watt took the helm in January.
New director at FHFA
The FHFA is the agency responsible for overseeing the operations of mortgage finance giants, Fannie Mae / Federal National Mortgage Association (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC). The companies were placed under conservatorship after receiving a huge bailout from the government to prevent collapse.
FHFA plays a crucial role as the two GSEs account for two-thirds of new mortgages in the country.
Soon after taking over as director at FHFA in January, Mel Watt didn’t waste any time signaling that he intended to take the organization in a different direction than his predecessor Edward DeMarco. Mel Watt had sent an email to reporters telling them that he has put a hold on plans to increase rates for insuring mortgage securities. The plan to increase rates would have made Fannie and Freddie less competitive, giving banks more incentive to look for private sources of mortgage insurance.
$187.5 billion bailout
DeMarco oversaw the conservatorship of Fannie Mae / Federal National Mortgage Association (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC), the mortgage-finance companies seized by U.S. regulators in September 2008. He focused on improving the bottom line and conserving assets for taxpayers after the companies received a $187.5 billion bailout from the U.S. Treasury.
In a press release issued Monday, Melvin L. Watt thanked DeMarco for providing assistance during the transition period. He complimented DeMarco for being an invaluable asset to FHFA and noted his involvement in many important public policy contributions grounded in his strong background in housing finance.
DeMarco was a top official at the FHFA’s predecessor agency, the Office of Federal Housing Enterprise Oversight. Subsequently he became senior deputy director at the housing finance agency when it was created under a 2008 law. He previously held positions at the Social Security Administration and the Treasury Department.