Fannie flushes out CRO and CFO, but Mudd sticks

Fannie Mae has made several leadership changes aimed at improving capital management and reducing credit losses.

The appointments at the US government-sponsored entity are effective immediately and include Michael Shaw as chief risk officer, David Hisey as chief financial officer and Peter Niculescu as chief business officer.

"This team will be responsible for meeting the dual objectives of conserving capital and controlling credit losses while Fannie Mae continues to provide crucial liquidity to the US housing and mortgage markets. As we move through the bottom of this cycle, maintaining capital, managing credit and driving revenues are the priorities - and we have to organise and staff accordingly," said Fannie Mae’s Washington, DC-based chief executive Daniel Mudd.

Shaw will have overall responsibility for credit, market, counterparty and operational risk oversight for all business units within Fannie Mae. In addition, he will manage the creation of risk policies as well as the measuring, reporting and monitoring of the company’s risk profile. He has worked in the credit risk oversight department at the firm since 2006.

Shaw replaces the previous chief risk officer, Enrico Dallavecchia, who is leaving to pursue other opportunities in finance and risk management, according to Fannie Mae. Mudd said, "Enrico led the restructuring of Fannie Mae's enterprise-wide risk management and oversight functions, which was critical to the company's Sarbanes-Oxley remediation and compliance.”

The previous chief financial officer, Stephen Swad, is also leaving the company to pursue other opportunities. In taking up this role, Hisey will be responsible for the company's financial reporting, accounting and internal controls. He will also work with Niculescu in carrying out Fannie Mae's capital management plan. Hisey joined Fannie Mae in 2005 and was controller in his most recent position.

Niculescu, previously head of the capital markets business, will now have responsibility for Fannie Mae’s main business divisions, and oversee the implementation of the company's capital management and credit-loss reduction plan. He replaces Robert Levin, who will retire from the company early next year.

Another US government-sponsored entity, Ginnie Mae, has also recently appointed a new chief risk officer within the past few weeks and committed to altering its risk management given the troubles in the mortgage-backed securities markets in the US.

See also: Freddie Mac and Fannie Mae to scale back mortgage guarantor business
Ginnie Mae creates risk committee and appoints CRO