Mortgage woes show GSE reform needed - U.S. Treasury

WASHINGTON, Feb 7 (Reuters) - U.S. Treasury Assistant Secretary David Nason said on Thursday that the current mortgage market woes point to the need for a new regulator for Fannie Mae (FNM.N: Quote, Profile, Research) and Freddie Mac (FRE.N: Quote, Profile, Research).

The nation's two largest sources of mortgage finance have increased their business since the recent mortgage market crisis started and their regulator does not have the tools needed to monitor their safety and soundness, he said.

"The housing GSEs' regulators have neither the tools, nor the resources, to deal effectively with the current size, complexity, and overall importance of these enterprises," he told a panel of the U.S. Senate Banking Committee. (Reporting by Patrick Rucker; Editing by Chizu Nomiyama)