GSE fundraising key to lower capital mandates-OFHEO

NEW YORK, April 8 (Reuters) - The size and timing of fund-raising efforts of Fannie Mae (FNM.N: Quote, Profile, Research) and Freddie Mac (FRE.N: Quote, Profile, Research) will determine if their capital requirements will be lowered further, their federal regulator said on Tuesday.

The companies are expected to raise significant capital to supplement a move by the regulator to relax constraints on the biggest providers of U.S. home loan funding last month. The capital would be aimed at stabilizing the ailing U.S. housing market through purchases of mortgages and securities.

"The key thing will be their capital raise, and how much it is and when it is," James Lockhart, director of the Office of Federal Housing Enterprise Oversight, told Reuters. "That, to me, will decide what the next step should be" on lowering the capital surplus again, he said. (Reporting by Al Yoon and Lynn Adler in New York and Patrick Rucker in Washington; Editing by James Dalgleish)