David Kellermann, the acting chief financial officer of money-losing mortgage giant Freddie Mac was found dead at his home Wednesday morning in what police said was an apparent suicide.
Kellermann, 41, lived in Hunter Mill Estates, a well-off neighborhood of large single-family homes with manicured lawns. County records show Kellermann's home is worth about $900,000.
The Fairfax County police responded to a 911-call at 4:48 a.m. at the suburban Virginia home Kellermann shared with his wife and a daughter. The police would not release the cause of death or say if a suicide note was found.
Kellermann's death is the latest in a string of blows to Freddie Mac, which owns or guarantees about 13 million mortgages and us the No. 2 mortgage finance company after sibling Fannie Mae. The company has been criticized for financing risky mortgage loans that fueled the real estate bubble, and its first government appointed CEO, David Moffett, resigned last month after six months on the job.
Morgan Stanley (MS.N) posted a wider-than-expected quarterly loss on Wednesday and slashed its dividend as real estate investment losses and a debt-related charge wiped out trading gains.
Morgan posted a net loss applicable to common shareholders of $578 million, or 57 cents a share, for the first quarter, compared with shareholder income of $1.31 billion, or $1.26, in the comparable period last year. Analysts on average expected a loss of 9 cents a share, according to Reuters Estimates.
The bank cut its quarterly dividend by 80 percent to 5 cents a share from 27 cents. The move will save the bank an additional $1 billion a year.
"I guess this shows not all banks are alike. It looks like (Chief Executive) John Mack took less risk and missed out on a chance to pick up some trading revenue," said Matt McCormick, portfolio manager at Bahl & Gaynor Investment Counsel in Cincinnati.
The loss, the third in six quarters for the investment bank and brokerage, disappointed investors who were hopeful after strong trading results last week at rival Goldman Sachs Group Inc (GS.N). Morgan shares were down 4.75 percent in midday trading.
"We remain cautious," Chief Financial Officer Colm Kelleher said in an interview, though he stressed Morgan Stanley has more than enough capital and cash on hand to go back on offense.
"We're ready to go when we see risk-adjusted returns," he said. "We've made no secret 2008 was hugely challenging for the industry and 2009 we always saw as a year of transition. An extra three months of being safe to me is not a mortal sin."
To the extent the bank would make acquisitions, it would focus on expanding or complementing its wealth management business, Kelleher said on a conference call.
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