Lauren Tara LaCapra
Fannie Mae(FNM Quote - Cramer on FNM - Stock Picks) outlined a sweeping plan to replace three top managers on Wednesday, in an effort to stem losses from a tough credit market and better manage its precious capital.
CEO Daniel Mudd, who will remain in his position, said three top executives -- of finance, business and risk -- will leave the government-supported mortgage giant to be replaced with internal choices. The announcement comes after weeks of volatile trading due to concerns that the Treasury Department would be forced to rescue Fannie and its counterpart Freddie Mac(FRE Quote - Cramer on FRE - Stock Picks), a move that would likely wipe out shareholders. In August alone, Fannie shares have ranged from a low of $3.53 last week from a high of $13.60 earlier this month, with the price surging and plunging amid speculative reports about the future of the firms. CFO Stephen Swad is leaving Fannie after a little more than a year on the job, to be replaced by Controller David Hisey. Chief Business Officer Robert Levin is also retiring after more than 27 years, to be replaced by Peter Niculescu, who had overseen Fannie's capital-markets business. Levin will leave the firm in early 2009. During the transition period, both Swad and Levin will remain with the company as senior advisors with their current compensation. Chief Risk Officer Enrico Dallavecchia will be replaced by Michael Shaw. The move will place Shaw in charge of all credit, market, counterparty and operational risk, an expansion of his previous role as senior vice president of credit-risk oversight.
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