Changes in the executive suite at Freddie Mac, namely efforts to find a new chief executive for the housing agency, are not performance-related but come as a result of a long-standing agreement with the agency's regulator, the Office of Federal Housing Enterprise Oversight.
"We have said we expect to have someone for that postion later this year," said Michael Cosgrove, a Freddie Mac spokesman.
Media reports on Tuesday suggested CEO Richard Syron's role would change because of an increase in problem mortgage loans in Freddie Mac's portfolio. However, sources familiar with the situation noted that the change, which has Syron relinquishing his role as CEO, comes as a result of an agreement with OFHEO.
Essentially, the source says, OFHEO agreed to roll back requirements that call on Freddie Mac to have money set aside for problem loans if Freddie Mac accelerated its search for a new CEO. That capital surcharge was lowered from 30% to 20%.
Freddie Mac agreed that the role of chairman and CEO would not be held by one individual in 2003 after the housing agency announced it had to restate is earnings. Freddie Mac's board of directors has a special committee heading up the search for a new CEO and an executive search firm has been hired to find a replacement.
Syron joined Freddie Mac in December 2003 from Thermo Electron, a designer and developer of high-tech instruments, where he was chairman of the board. Syron joined Thermo Electron in June 1999 as president and CEO, and became chairman in January 2000.
At Thermo Electron, Syron designed and executed a revamping of the company's organizational, legal and capital structure, reshaping an organization of 24 publicly-traded companies in six different industries into one operating company focused on the instruments business.
Before becoming chief executive at Thermo Electron, Syron was chairman and CEO of the American Stock Exchange (Amex). Syron joined the Amex as CEO in 1994. Before his work at the exchange Syron held senior posts in the banking sector including top positions at the Federal Reserve Bank of Boston and at the Federal Home Loan Bank of Boston.