Fannie Mae CEO on his way out
Today, after 20 years with the organization, Fannie Mae said in a statement that CEO Michael Williams is resigning after taking over as President and CEO in 2009. Williams will remain in the CEO role until Fannie Mae’s Board of Directors names a successor. Rumors have not yet leaked as to who that may be.
“On behalf of the board of directors, I want to extend our gratitude to Mike for his tireless dedication to Fannie Mae and especially his exemplary service as its leader through three extremely challenging years,” said Fannie Mae Chairman, Philip A. Laskawy. “As a result of Mike’s leadership, Fannie Mae is a better company and our country benefits from a stronger housing finance system.”
The government-sponsored entity was put into conservatorship in 2008 to save it from failing, and posted losses of $5.1 billion in the third quarter of 2011 and requested $7.8 billion more in taxpayer support from the Treasury Department, the same month that they were criticized for wasteful spending and for awarding executives exorbitant bonuses despite struggling to perform without further governmental aide.
In December, the Securities and Exchange Commission charged six former Fannie Mae and Freddie Mac executives with civil fraud for misrepresenting their holdings of high-risk mortgage loans, although Williams has come out clean, former Fannie Mae CEO Daniel Mudd was charged. Additionally, two former CEOs of Fannie Mae, James A. Johnson and Franklin Raines were named as recipients of low-cost “Friends of Angelo” loans from Countrywide, a conflict of interest for the two.
Why Williams resigned
Fannie Mae’s statement today provided no reason for Williams’ leaving, but he did say generically, ” I decided the time is right to turn over the reins to a new leader.” Williams is leaving behind a massive organization that continues to have financial woes.
Williams’ resignation is no surprise as last fall, Freddie Mac CEO Ed Haldeman announced that he would retire this year, and a hand full of Freddie executives are either reaching mandatory retirement age, retiring voluntarily, or leaving the organization, also without a successor.
The large organizations are in a period of transition, marred by poor performance, financial hemorrhaging, massive salaries and bonuses, wasteful spending and requests for more extensive taxpayer assistance, and a leadership exodus is to be expected – look for more executives to step down this year.