US Treasury: no plans to backstop Fannie, Freddie

WASHINGTON (Reuters) - The U.S. Treasury repeated on Monday that it has no plans to use its new authority to backstop mortgage finance giants Fannie Mae (FNM.N) and Freddie Mac (FRE.N) by providing them with equity capital or new loans.

Treasury spokeswoman Jennifer Zuccarelli declined to comment on a Barron's article suggesting an increasing likelihood that the Treasury may recapitalize and essentially nationalize the two government-sponsored enterprises.

"As the secretary said many times before, we have no plans to use the authority that we've been given, so I'm not going to comment on any speculation," Zuccarelli told a news briefing on Monday, referring to U.S. Treasury Secretary Henry Paulson.

She acknowledged that Paulson has publicly urged Fannie and Freddie to raise capital, but declined to comment on the Barron's report citing a Bush administration "insider" as saying that officials from the Treasury and the new GSE regulator were "jawboning" Fannie and Freddie officials to sell new equity.

(Reporting by David Lawder; Editing by Tom Hals)