Summit Notebook

from LEGACY Reuters Summits:

Troubled Freddie Mac exec was “straight arrow”

James Lockhart, head of the Federal Housing Finance Agency

The chief financial officer at Freddie Mac who died in an apparent suicide was a capable executive who had no involvement in any improper accounting, according to Freddie Mac's federal regulator.

"David (Kellermann) was a very conscientious and hard-working person and took, unfortunately, too much onto himself," James Lockhart, the director of the Federal Housing Finance Agency, told the Reuters Global Financial Regulation Summit in Washington.

Kellermann was found dead on April 22 in the basement of his Virginia home after having hung himself, local police sources said. Some news reports at the time tied Kellermann's death to ongoing federal investigations into Freddie Mac's accounting.

"You know, one of the things I find unfortunate? Some of the speculation about accounting issues at Freddie. They are very rigorous," Lockhart said. He described Kellermann as a "straight arrow" whose reputation was above reproach and said that the failings at Freddie Mac were widely shared.

Bankers’ chief says “vilification” of bankers tough to take

Martin Howell

Apr 28, 2009 18:39 UTC

As the president of the American Bankers Association, Edward Yingling has soaked up a lot of criticism of the nation’s bankers in the past year. He has also had to work many hours to fight to ensure that crisis measures by the government don’t cause long-term damage to his members. But the one thing he has had difficulty in coping with is the assault on banking as a profession and links made by politicians and the media between any financial institution that has problems and bankers. He told the Reuters Global Financial Regulation Summit on Tuesday he is angry about the “vilification of the banking industry” given that many bankers had nothing to do with creating the financial crisis. He said the word “bank” appeared in stories in which it didn’t belong. “AIG was not actually a bank,” he said.

Mind you, Yingling remains uncompromising when pushed on how much banks are to blame for the events of the past two years. While acknowledging that some of his members made mistakes, he blames accounting rules that forced banks to value their investments at market levels, even if that didn’t reflect their longer-term value, for much of the damage to the financial system. And, he says, it was liquidity problems and a loss of confidence that caused a bank like Wachovia to be rescued more than the weak quality of the mortgage assets held by Golden West, which it bought in 2006. If anyone is looking for apologies — they won’t get them from this direction.