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| Version 0 | Version 1 |
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| US takes over key mortgage firms | US takes over key mortgage firms |
| (10 minutes later) | |
| US financial officials have outlined plans for the government to take over the failing mortgage giants Freddie Mac and Fannie Mae. | US financial officials have outlined plans for the government to take over the failing mortgage giants Freddie Mac and Fannie Mae. |
| The two companies account for nearly half of the outstanding mortgages in the US, and have lost billions of dollars during the US housing crash. | The two companies account for nearly half of the outstanding mortgages in the US, and have lost billions of dollars during the US housing crash. |
| The most recent figures show about 9% of US homeowners were behind on their payments or faced repossession. | The most recent figures show about 9% of US homeowners were behind on their payments or faced repossession. |
| The federal takeover is one of the largest bail-outs in US history. | The federal takeover is one of the largest bail-outs in US history. |
| 'Comprehensive action' | |
| As part of the changes, the management of the two companies will be replaced and the firms will be given access to extra funding to support their business going forward. | |
| Treasury Secretary Henry Paulson said the government was intervening in the wider interests of the financial system and of taxpayers since the financial position of the two firms was fast deteriorating. | |
| He added that the two firms' debt levels posed a "systemic risk" to financial stability. | |
| "We examined all options available and determined this comprehensive and complementary set of actions best met the objectives of market stability, mortgage availability and taxpayer protection," he said. | |
| The move is intended to keep the two companies afloat, amid fears that either could go bankrupt as borrowers default on their home loans. | |
| Together, Freddie Mac and Fannie Mae own or guarantee about $5.3 trillion (£3 trillion) of mortgages. | Together, Freddie Mac and Fannie Mae own or guarantee about $5.3 trillion (£3 trillion) of mortgages. |
| Banks around the world are highly exposed to the two companies and therefore, given the febrile state of markets across the world, it had become dangerous for doubts to persist about whether they were viable and would be able to keep up the payments on their massive liabilities, says the BBC's business editor Robert Peston. | Banks around the world are highly exposed to the two companies and therefore, given the febrile state of markets across the world, it had become dangerous for doubts to persist about whether they were viable and would be able to keep up the payments on their massive liabilities, says the BBC's business editor Robert Peston. |
| A rescue plan passed by Congress in July gave the US government the authority to offer unlimited liquidity to the two companies, and to buy their shares, in order to keep them afloat. | A rescue plan passed by Congress in July gave the US government the authority to offer unlimited liquidity to the two companies, and to buy their shares, in order to keep them afloat. |