Quasi-governmental mortgage company Freddie Mac (NYSE: FRE ) last night named its third chief executive officer in a year. By the end of 2003, Richard Syron will take the reins from Greg Parseghian, who took over for the ousted Leland Brendsel.
Freddie's troubles since June have been well documented, with the company first saying it understated earnings and then recently disclosing that (whoops!) it actually overstated them in one year. The company's lack of quality leadership has been systemic, with the first CEO stepping down in response to the scandal, and the second (Parseghian) being asked by regulators to resign after his reported knowledge of Freddie's questionable accounting practices came out.
The insider nature of both of Freddie's former chiefs, then, is one reason that Syron's appointment is a positive development for the company and its shareholders. Syron's resume includes stints as the president of the Boston branch of the Federal Reserve and head of the American Stock Exchange. His most recent job was as the executive chairman of scientific equipment company Thermo Electron (NYSE: TMO ) . He's an outsider to Freddie, but has extensive experience in operating big economic entities and dealing with regulators.
He is widely regarded as a strong leader, and is highly respected by his peers and former colleagues. Shareholders should be pleased with this announcement. Of course, there's no way to tell how successful Syron will be in his new position, and Freddie's future is still fraught with challenges, but this is a solid first step towards returning Freddie to respectability.
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