Navigation

Swiss Re shares sink on Fannie and Freddie

Shares of Swiss Re fell eight per cent early on Wednesday after it announced it had a $9.6 billion (SFr9.7 billion) exposure to mortgage lenders Freddie Mac and Fannie Mae.

This content was published on July 16, 2008 - 15:10

The world's largest reinsurer said it owned $5.2 billion in Freddie Mac debt and $4.4 billion in Fannie Mae debt as of July 1. Its stock hit a five-year low in trading on the news before rising again to close 2.3 per cent below Tuesday's figure.

A statement by the company said it had released the information in response to inquiries from analysts and investors. Analysts called Wednesday's sudden drop an overreaction.

Swiss Re's mortgage-backed securities portfolio comprises investments in the two companies and in Ginnie Mae. All three are backed by the United States government.

The company's strategy of operating in both the investment banking and insurance markets has made it one of the hardest hit insurance firms in the US sub-prime mortgage crisis.

Articles in this story

This article was automatically imported from our old content management system. If you see any display errors, please let us know: community-feedback@swissinfo.ch

In compliance with the JTI standards

In compliance with the JTI standards

More: SWI swissinfo.ch certified by the Journalism Trust Initiative

Contributions under this article have been turned off. You can find an overview of ongoing debates with our journalists here. Please join us!

If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.

Share this story

Change your password

Do you really want to delete your profile?