Fannie Mae Ready to Weather Tough Times, Chief Says

The chairman of the Federal National Mortgage Assn., awaiting a financial report card from the government, said today his organization has plenty of cash and securities on hand to weather an economic downturn.

Fannie Mae chief David Maxwell said the federally chartered corporation that deals in home mortgages and mortgage-backed securities has $3.7 billion in capital and plans to raise the amount to $6 billion by 1991.

The remaining money will come from regular earnings, Maxwell said.

After a series of “stress tests” to determine whether Fannie Mae could survive an increase in interest rates or mortgage defaults, Maxwell said, “Our capital would be adequate to survive . . . with a cushion.”

The General Accounting Office and the Treasury Department are expected to release a report on the soundness of Fannie Mae as early as next week as required by legislation reorganizing the savings and loan industry.