Morgan to Advise Feds on Fannie, Freddie

Morgan Stanley (MS) has been hired by the Treasury Department to advise the agency in its effort to ensure government-sponsored mortgage buyers Fannie Mae (FNM) and Freddie Mac (FRE) remain capable of financing the housing market.

In a press release Tuesday afternoon, Morgan Stanley said it would support the Treasury's plan to "promote market stability and the availability of mortgage credit."

The New York-based investment bank won't take any fees for the work and will receive only $95,000 from the government toward its expenses.

Last month, the Treasury set plans to temporarily increase the lines of credit available for Fannie and Freddie. The Treasury will also have temporary authority to buy equity in the two companies, as needed, to make sure they have adequate capital.

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