Freddie Mac CFO Dead; Suicide Suspected

This is not the type of news that I like to report on my blog, but the rampant rumors about Freddie Mac’s solvency coupled with some wild speculation about the many plausible reasons for this act has compelled me to post this story.

According to the New York Times: “David B. Kellermann, the acting chief financial officer of the troubled mortgage giant Freddie Mac, was found dead Wednesday morning at his home in Northern Virginia, the police said…see the rest of the Freddie Mac CFO deal and suicide is suspected sotry.

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Freddie Mac CFO Dead; Suicide Suspected

This is not the type of news that I like to report on my blog, but the rampant rumors about Freddie Mac’s solvency coupled with some wild speculation about the many plausible reasons for this act has compelled me to post this story.

According to the New York Times: “David B. Kellermann, the acting chief financial officer of the troubled mortgage giant , was found dead Wednesday morning at his home in Northern Virginia, the police said.

The executive apparently committed suicide by hanging himself, according to people with knowledge of the investigation.

Mr. Kellermann, 41, had been Freddie Mac’s chief financial officer since September. He was named to the position when the federal government seized the company and ousted its top executives last fall. In recent weeks, according to neighbors and company officials, Mr. Kellermann had received a bonus of about $800,000. Such bonuses – which totaled $210 million for executives at Freddie Mac and its sibling company – caused some controversy earlier this month, and some lawmakers called for them to be rescinded.

According to neighbors, Mr. Kellermann hired a private security firm after reporters came to his house to ask about his bonus.

Mr. Kellermann was also involved in recent tense conversations with the company’s federal regulator over its public disclosures. Freddie Mac executives wanted to emphasize to investors that the company was being run for the benefit of the government, rather than shareholders.

Mr. Kellermann’s death is the latest blow to the company. The chief executive, David M. Moffett, resigned last month after apparently clashing with the company’s regulator over compensation issues and independence.

Freddie Mac and Fannie Mae, which together own or back more than half of the home mortgages in the country, have been hobbled by skyrocketing loan defaults and have received about $60 billion in combined federal aid.”

You can image the rumors beginning to swirl in the wake of Freddie Mac’s top money man taking his own life, but I believe that it would be prudent to hold judgment until a full investigation can be completed.

Update 4/23/09– Kellermann, 41, had risen through the ranks at Freddie Mac since beginning as an accountant 16 years ago. Since taking over as CFO neighbors saw the strain and stress building. Some had even advised him to quit, but Kellermann responded that he wanted to help the company through its difficulties, which include mounting losses, several open positions and intense political pressure to stem foreclosures.

Neighbors also noticed a security detail showing up at his suburban home in the upscale Washington suburb of Vienna after executives at Freddie Mac faced intense criticism for deciding to pay retention bonuses. Later it was learned that Freddie Mac’s human resources department head had just a day earlier advised Kellermann to take time off to ‘decompress’.

Slight Drop in Nashville Mortgage Rates

Freddie Mac reports a drop in the 30-year fixed mortgage rate to 4.82 percent during the week ended April 16 from 4.87 percent the prior week, while interest on 15-year fixed loans fell to an average of 4.48 percent from 4.54 percent. The five-year hybrid adjustable mortgage rate slipped to 4.88 percent from 4.93 percent, but the one-year ARM rose to 4.91 percent from 4.83 percent.

Read the entire Nashville mortgage rates story.

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Slight Drop in Nashville Mortgage Rates

Freddie Mac reports a drop in the 30-year fixed mortgage rate to 4.82 percent during the week ended April 16 from 4.87 percent the prior week, while interest on 15-year fixed loans fell to an average of 4.48 percent from 4.54 percent. The five-year hybrid adjustable mortgage rate slipped to 4.88 percent from 4.93 percent, but the one-year ARM rose to 4.91 percent from 4.83 percent.

Freddie Mac chief economist Frank Nothaft says, “The housing industry is starting to exhibit some positive signs, albeit scarce and too early to tell how permanent.” The signs seem to be the same for the Nashville housing market as well. Pending Nashville home sales are up 17% from just 2 months ago, however, we need more data in order to predict rather this is the bottom or not.

We have noticed that some local banks have turned to the real estate auction industry to dump parts of their REO portfolios. Others have decided to hold on to their properties and simply hire a property management company to managed those efficiently. What we do not know is: what percentage of their total REO portfolio do these properties represent. Once we discover that data, we should be able to predict when Nashville’s housing market will hit bottom.

The Terrazzo Gains Commercial Office Tenant

This article entitled “BB&T makes moves to Terrazo in Gulch” appeared in the Nashville Business Journal on April the 13th, 2009. A staff writer wrote:

“BB&T has moved its commercial lending and wealth management operations from Belle Meade to the Terrazzo in the Gulch.

BB&T signed the lease for space in the $68 million mixed-use tower in early 2008, when it was the first commercial tenant to lease space in the building…continue reading the full Terrazzo office space tenant article.

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The Terrazzo Gains Commercial Office Tenant

This article entitled “BB&T makes moves to Terrazo in Gulch” appeared in the Nashville Business Journal on April the 13th, 2009. A staff writer wrote:

“BB&T has moved its commercial lending and wealth management operations from Belle Meade to the Terrazzo in the Gulch.

BB&T signed the lease for space in the $68 million mixed-use tower in early 2008, when it was the first commercial tenant to lease space in the building.

The bank’s commercial division has been located at One Belle Meade Place for five years. BB&T’s Nashville insurance arm, Cooper Love Jackson Thornton & Howell, will stay at the Belle Meade office.

The Terrazzo location downtown makes a statement about BB&T’s commitment to our clients, Nashville and Middle Tennessee,” says Natalie Ruggiero, who heads BB&T area operations, in a release.

The bank will hold a grand opening soon for a full-service retail financial center to be located in the Terrazzo.

BB&T opened its Nashville based commercial lending operation in 2004. The bank has two other Nashville area branches, one in Green Hills and the other in Cool Springs. BB&T operates 1,500 financial centers in 11 states and Washington D.C.”

This is certainly great news for the Terrazzo as well as for the other condo developers in the Gulch. A commercial tenant as prestigious as a commercial banking tenant is not easy to land in today’s volatile market. For more Nashville office space news, check out what the guys at Cumberland Commercial are doing.

See all condos for sale in The Terrazzo

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