Fannie Mae cuts stock dividend by half.

Position:Business Alert - Brief Article
 
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FANNIE MAE'S BOARD OF DIRECTORS declared the company's first-quarter 2005 dividend on its common stock of 26 cents ($0.26) per share and dividends on its preferred stock in accordance with the terms of the stock. The board decided to reduce the first-quarter common stock dividend by 50 percent in order to accelerate an increase in Fannie Mae's capital. The Office of Federal Housing Enterprise Oversight (OFHEO) approved payment of the dividends.

"The board of directors believes that this is a prudent and responsible action to take as the company moves expeditiously to increase its capital," said Stephen Ashley, non-executive chairman of Fannie Mae's board of directors. "We look forward to continue working with OFHEO to attain the capital restoration plan," Ashley added. Fannie Mae has submitted a capital restoration plan to OFHEO for its review and approval, and is working with OFHEO to address any comments or concerns, according to a Fannie Mae statement. Reducing the common stock dividend will contribute toward building Fannie Mae's capital to a 30 percent...

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