1938 Fannie Mae (NYSE: FNM - News) created during the Great Depression as a government agency to ensure supply of mortgage funds. The aim was to boost banks' capacity to offer home loans by buying up existing loans in exchange for cash

1968 Fannie Mae re-chartered by Congress as a shareholder-owned company, funded solely with private capital

1970 Freddie Mac created to provide competition in the secondary mortgage market and end Fannie Mae's monopoly

1971 Freddie Mac introduces the first mortgage-related security

2003 US policy interest rates hit a low of 1%, further stoking the booming US housing market

2004 Following an accounting scandal, Fannie and Freddie's regulator Ofheo requires the companies to raise their level of core capital 30 per cent above previous levels, in effect capping their ability to purchase mortgages

2006 A steep rise in the rate of subprime mortgage defaults and foreclosures lead a number of subprime mortgage lenders to fail. The failure of these companies causes prices in the mortgage-backed securities market to slip

August 2007 Rising defaults on subprime mortgages trigger a global credit crunch

March 2008 Ofheo gives both companies permission to add as much as $200bn financing into the mortgage markets by reducing their capital requirements

April 2008 Ofheo report reveals that Fannie and Freddie accounted for 75 per cent of new mortgages at the end of 2007 as other sources of financing pull back on lending

July 2008 Shares in Freddie Mac and Fannie Mae plummeted amid speculation that a bailout of the government-sponsored mortgage financiers may be required, and that such a bail-out would leave little if any value for current shareholders. Frantic trading on Thursday in New York dragged shares in both companies down to their lowest levels since 1991