Fannie Mae, Freddie Mac Managers' Median Pay: $200,000 a Year


By MARCY GORDON

WASHINGTON -- A government report finds median pay for nearly 2,000 senior managers at government-controlled Fannie Mae and Freddie Mac exceeded $200,000 last year.

The Federal Housing Finance Agency, which oversees the two mortgage giants, also did an inadequate job monitoring pay, according to the report released Monday from the inspector general for the FHFA.

The median figure means that half the managers received salaries above $200,000 and half received less.

Those managers represent nearly 17 percent of the roughly 11,900 total employees at the two bailed-out companies. Compensation for senior managers at the companies cost about $455 million in 2011, according to the report.

The report also says the top 333 of those managers are vice presidents who had median pay of $388,000. That's close to salaries paid by private financial firms and exceeds pay for similar jobs at federal agencies.

Because the FHFA doesn't closely evaluate the compensation of senior managers, it is unable "to ensure that the costs associated with senior professional compensation are warranted," the report says.

The FHFA said Monday that it agreed with the inspector general's conclusion that it should improve its oversight of senior managers' pay. The FHFA said it plans to make a full review.

Taxpayers so far have paid roughly $170 billion to rescue Fannie and Freddie, which suffered huge losses from risky mortgages during the 2008 financial crisis.

Fannie and Freddie together own or guarantee about half of all U.S. mortgages, or nearly 31 million home loans.

Under pressure from Congress, the FHFA earlier this year capped pay for Fannie and Freddie's CEOs at $500,000 a year. The agency also cut pay for about 50 other executives, who were earning more than the companies' senior managers looked at in the latest report.

In December 2010, the agency imposed a freeze on merit pay increases and cost of living adjustments for all Fannie and Freddie employees in 2011. It later was extended to cover 2012.

The agency and the two companies have said that the relatively high levels of compensation are needed to attract and keep qualified employees.

"There's a lot at stake for our country and it is absolutely critical that Fannie Mae compensation is competitive in the market for financial services talent," Fannie spokeswoman Kelli Parsons said in a statement Monday.

Compensation for Fannie employees has declined "substantially" from the levels of pay before the government takeover, Parsons said.

Brad German, a spokesman for Freddie, said "We compete every day with Wall Street for finance experts, mathematicians, engineers and other professionals."

Freddie uses "a rigorous compensation process" to offer pay that is reasonable yet competitive, German said in a statement.

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jhon.jakson

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July 15 2013 at 3:30 PM Report abuse rate up rate down Reply
donut999

In many ways, this article is bogus, but primarily because it does not deal much with what these guys would make up and down the street. First of all, these numbers are not out of whack with what would be expected. In fact, if the top dog is capped at a half million, doubt we have the best caliber of top dog unless he is independently wealthy and doing it partially as community service.

It seems to gall people when they see large salaries by their standards. These are not by market standards. Should we get some discount dummies in to manage gazillions of bucks?

December 11 2012 at 4:45 AM Report abuse -1 rate up rate down Reply
thebrainbutcher

this is just a joke.
i'll bet they are union employees and nobody can touch them. unions are killing this country. they are zealots to protect their workers even if they suck.
I would lay 1/2 off tomorrow, but keep the front line account receivables workers (where the real work is done).

December 10 2012 at 10:28 PM Report abuse -4 rate up rate down Reply
Bill

Absolutely critical we cut the wages of overpaid employees in both government and private sector jobs. Please read my lips no more overpaid workers in government or wall street. How do you justify these assinine statements about we need to pay these wages to compete with private industry. When private industry has nothing but overpaid cheating employees why should the government do the same. Lower the wages of these idiots who are overpaid. I am tired of hearing the sqame old lies over and over again. Read my lips " NO MORE OVERPAID WORKERS IN PRIVTE INDUSTRY OR GOVERNMENT POSITIONS." A country run by fools who cannot think for themselves. A good place to start with the wage cutting is at the universities who teach this nonsense gibberish.

December 10 2012 at 9:05 PM Report abuse rate up rate down Reply
1 reply to Bill's comment
donut999

You seem to be missing part of the equation. Agree, do not overpay government workers. At the lower ranks, we might be able to even pay them less than the competetive market because of the perks. But if we want experienced, savvy, Harvard, Yale, Princeton, and Duke MBA's in these jobs, then the pay offered has to be relatively close to what they could obtain elsewhere by those "private industry entities overpaying cheating employee's". No lies, a dose of reality. If you cannot handle reality, then it probably does appear to be a lie.

December 11 2012 at 6:42 AM Report abuse rate up rate down Reply