Loomis Sayles' Fuss buying Fannie, Freddie debt

NEW YORK (Reuters) - Loomis Sayles, one of the largest fixed-income fund managers, is buying Fannie Mae and Freddie Mac agency debt, a top firm official said on Thursday.

Dan Fuss, vice chairman of Boston-based Loomis Sayles, which oversees more than $100 billion in fixed-income securities, said he believes the corporate debt of the two mortgage finance companies offer "outstanding value," and he is confident the U.S. government would not let them fail.

Shares of both plunged Thursday for the third session in the past four days amid a firestorm of anxiety surrounding whether they need much more capital.

Yields on 10-year bonds issued by Fannie Mae and Freddie Mac ballooned 10 basis points to more than 1 percentage point above government debt. They had been quoted as much as 12 basis points wider than late Wednesday.

(Reporting by Jennifer Ablan; Editing by James Dalgleish)