Richard Syron, Freddie Mac's chairman and chief executive officer, said the company remains "extremely cautious" this year and acknowledged that a continued weakening economy "will have a further negative effect on homeowners across the country and drive credit costs higher." After Freddie Mac announced its massive third-quarter loss in November, the company sold $6 billion in stock and slashed its dividend by 50%. Its regulatory core capital was $37.9 billion as of Dec. 31, which was $11.4 billion in excess of its regulatory minimum capital requirement and about $3.5 billion over the 30% mandatory target capital surplus enforced by the Office of Federal Housing Enterprise Oversight (OFHEO). OFHEO Lifts Caps The good news for both agencies is that the OFHEO decided to lift their portfolio growth caps on March 1, which will allow the companies to infuse the moribund housing market with more capital. The GSEs have had the caps in place since 2006 when they announced roughly $11.3 billion in accounting errors.