Federal National Mortgage Association

Fannie Mae said Tuesday it would withhold $44.4 million in bonuses to former and current executives, including Chief Executive Daniel Mudd. The mortgage finance company will deny the long-term incentive pay to 46 former and current executives, Fannie Mae spokeswoman Janis Smith said. Fannie Mae in December said it overstated earnings from 2001 until mid-2004 by $6.3 billion.

Federal Reserve Chairman Ben S. Bernanke urged Congress on Tuesday to bolster regulation of mortgage giants Fannie Mae and Freddie Mac and suggested limiting their massive holdings to guard against any danger their debt poses to the overall economy. Bernanke has previously supported efforts to pare the two mortgage companies' huge portfolios.

The heads of Fannie Mae and Freddie Mac said Tuesday that they were developing new types of loans to help borrowers with high-risk mortgages keep their homes at a time of rising foreclosures. A key federal regulator also urged lenders to step in now and extend flexible terms to struggling homeowners.

Money has started to be distributed to shareholders hurt by an alleged accounting fraud at Fannie Mae under a $400-million settlement signed last year with the mortgage giant, federal regulators said Monday. The Securities and Exchange Commission said the full amount that will go to shareholders, $357 million, is expected to be distributed by October. It is one of the largest such distributions in recent years, the result of the Sarbanes-Oxley law that followed the 2002 corporate scandals.

Shares of Fannie Mae and Freddie Mac, the two largest U.S. home-loan companies, rose on speculation that the companies' regulator may lift a cap on the amount of home loan assets they can own, helping to ease a funding crunch in the mortgage market. Fannie Mae shares jumped $5.87, or 10%, to $62.50. Freddie Mac rose $4.30, or 7.7%, to $60. Falling home prices and a surge in payment defaults have scared investors away from mortgage debt, including bonds and other securities backed by home loans.

Freddie Mac said Thursday that its huge mortgage holdings grew in July at the fastest pace in 16 months as the company took advantage of a faltering housing market to scoop up cheaper mortgage-backed bonds. In a bid to rescue the ailing housing and mortgage markets, lawmakers are pushing to raise the amount of home loans that can be held by Freddie Mac and its bigger rival Fannie Mae. The two government-sponsored firms are the largest U.S. home loan-funding companies.

Fannie Mae and Freddie Mac, the biggest sources of home financing, can buy $20 billion more in sub-prime mortgages under rules unveiled Wednesday to help revive a market crippled by tighter lending standards. The Office of Federal Housing Enterprise Oversight, the mortgage finance companies' federal regulator, agreed to relax restrictions on their investment holdings, although it did not eliminate existing caps on those loan portfolios.

The top two U.S. economic policymakers told a House panel on Thursday that allowing the biggest home finance companies to buy larger loans could ease mortgage market strains but the move should be coupled with tighter regulation of the firms. Federal Reserve Chairman Ben S. Bernanke and Treasury Secretary Henry M. Paulson Jr.

The federal regulator who oversees Fannie Mae and Freddie Mac accused New York's attorney general of overstating risks the mortgage finance companies face from faulty home appraisals. James B. Lockhart, director of the Office of Federal Housing Enterprise Oversight, sent a letter to Atty. Gen. Andrew Cuomo a day after he subpoenaed government-sponsored Fannie and Freddie in a probe of inflated appraisals.

Fannie Mae, the biggest source of money for U.S. home loans, said Friday that its third-quarter loss more than doubled to $1.39 billion as a deepening housing slump increased mortgage delinquencies. The net loss was caused by a $2.24-billion decline in the value of derivative contracts and $1.2 billion in credit losses among the $2.7 trillion of mortgage assets Fannie Mae owns or guarantees, the Washington-based company said in a Securities and Exchange Commission filing.