Alex Constantine - April 19, 2009
5 Apr 2009
NEW YORK: At a time when executive compensation has come under the lens, beleaguered American mortgage majors Fannie Mae and Freddie Mac are planning to shell out $210 million as bonuses to over 7,600 employees.
Out of the total amount, the two entities, bailed out by the Federal government, have already paid $50.8 million in 2008.
The details were revealed in a letter by James B Lockhart III, the director of the Federal Housing Finance Agency (FHFA), to Senator Charles E Grassley.
FHFA is in charge of Fannie Mae and Freddie Mac. Together, both companies would be paying a bonus of $210.2 million.
The letter said that bonuses would be paid to 3,545 employees at Fannie Mae and 4,057 people at Freddie Mac.
A total of $112.6 million would be given to Fannie Mae employees and $97.6 million to those at Freddie Mac.
The publicly-owned Fannie Mae and Freddie Mac were rescued by the US Federal government in 2008 in the wake of the ravaging financial meltdown. Nearly $200 billion was pumped in to shore up the fortunes of the two entities.
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The average retention bonus at Fannie Mae was less than $4000.