Fannie Mae CEO Daniel Mudd takes 15 percent pay cut in 2007

By Margarita Snegireva. CEO of Fannie Mae took a 15 percent pay cut in 2007 as the No. 1 mortgage finance company struggled with soaring credit expenses.

Fannie Mae CEO Daniel Mudd received $12.2 million in total compensation last year, down 15 percent from 2006, the government-sponsored enterprise said on Wednesday. Mudd's pay included his $990,000 salary, a $2.23 million bonus and a $9 million "long-term incentive" award, the company said.

The Federal National Mortgage Association ( FNMA ) commonly known as Fannie Mae, is a government sponsored enterprise (GSE) of the United States government. As a GSE, it is a privately-owned corporation authorized to make loans and loan guarantees. It is not backed or funded by the U.S. government, nor do the securities it issues benefit from any explicit government guarantee or protection.

This secondary mortgage market helps to replenish the supply of lendable money for mortgages and ensures that money continues to be available for new home purchases. The name "Fannie Mae" is a creative acronym-portmanteau of the company's full name that has been adopted officially for ease of identification.

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