Fannie Mae (FNM) and Freddie Mac (FRE) are unlikely to repay the government in full for all the capital it has pumped into the companies, according to their regulator.

"My view is that some assets in the senior preferred will have to be left behind as they come out of conservatorship," Federal Housing Finance Agency Director James B. Lockhart said Thursday in response to a question at a panel discussion in Washington. "That will mean that some of the losses will never be repaid."

The Treasury has agreed to pump $200 billion into each company in order to keep them solvent. In exchange, the government receives senior preferred stock that pays a 10% dividend. So far, it has injected $85 billion in total into the companies, but Lockhart said that figure was likely to rise in the coming months.

Fannie and Freddie together own or guarantee $5.4 trillion in mortgages. When the housing market soured in 2007, mortgage defaults ate through the companies' thin cushions of capital, prompting fears they would collapse. The government seized them in September, putting them under the conservatorship of their regulator.

FHFA on Thursday unveiled several new regulations concerning the mortgage giants and the 12 Federal Home Loan Banks. The regulator also announced conclusions from three studies it was required to conduct by a 2008 housing law.

One of the studies found that Fannie and Freddie have been using fees they collect for guaranteeing less risky single-family mortgages to subsidize the fees for backing riskier loans.

As a result, borrowers with 15-year fixed-rate mortgages and adjustable-rate mortgages were subsidizing borrowers with 30-year fixed-rate mortgages, which are more risky for the mortgage giants to guarantee.

"The riskiest loans were not fully charged for the additional expected costs associated with them," Federal Housing Finance Agency Chief Economist Patrick Lawler said at the panel discussion.

In another study, FHFA concluded that it should consider allowing the home loan banks to securitize the mortgages they obtain from member banks as collateral for advances. However, the banks should only undertake this new line of business after the government has resolved what it will do with Fannie and Freddie.

A final study concluded that the bulk of mortgage collateral underpinning home loan bank advances conformed to guidance issued by bank regulators on non-traditional mortgages.

FHFA issued a new rule to expand the home loan banks' ability to funnel their affordable housing funds toward helping strapped homeowners refinance under government programs.

The banks will now be able to plow the funds into refinancing activities under targeted government refinance programs, including the Obama administration's effort to help underwater homeowners take advantage of lower mortgage rates. Currently, borrowers qualified to refinance under the federal Hope for Homeowners program are the only ones able to access such aid.

The funds, which come from assessments on the home loan banks, may be used to assist homeowners to pay down principal or to offset closing costs for the refinanced loan. The new rule takes effect immediately.

FHFA also announced a proposed regulation to expand the board of the Office of Finance, which issues and services debt for the home loan banks. The regulator wants the board to consist of all 12 bank presidents and three to five independent directors.

And it finalized previously announced affordable housing goals for Fannie and Freddie for 2009. The regulator cited the turmoil in the mortgage market to explain why it notched down the goals from 2008.

Lockhart said Fannie and Freddie would likely see their reserves continue to decline next year, but could return to strong profits in two to three years. But he cautioned that the companies' thin capital and huge exposure to the mortgage market make it unlikely they will be able to repay the government in full.

"The book is so large that it is hard to see that they could actually repay all that," he said.

Lockhart said Fannie and Freddie aren't likely to burn through all $400 billion of government capital available under their agreement with the government. He cited stress tests that showed the total draws would remain below that level.

-By Jessica Holzer, Dow Jones Newswires; 202-862-9228; jessica.holzer@dowjones.com