US moves to bolster lending firms


The US government has announced sweeping measures to shore up the nation's two largest mortgage finance companies, Freddie Mac and Fannie Mae.

The plan calls on Congress to expand the companies' access to credit and allow the Treasury to buy shares in the companies if needed.

The two firms own or guarantee almost half of all US home loans - more than $5 trillion (£2.5 trillion) of debt.

Their share prices sank last week on fears they may struggle to raise funds.

The BBC's Greg Wood in New York says the emergency measures are meant to allay fears that the two companies are about to run out of money.

BY-BBC NEWS