June 26 (Bloomberg) -- Freddie Mac Treasurer Timothy Bitsberger said the subprime mortgage slump is ``severe but contained.''

Subprime borrowers, people with the riskiest credit records, make up a small part of the U.S. mortgage market and are mostly in seven states, Bitsberger said today at a conference in London. The owners of bonds made up of subprime mortgages are mainly ``large institutional players who can withstand the loss,'' he said. Freddie Mac is the second-biggest U.S. mortgage finance company.

Rising defaults on U.S. subprime mortgages have pushed at least 60 mortgage companies to close or sell their operations and forced Bear Stearns Cos. to offer as much as $3.2 billion to bail out a money-losing hedge fund. New foreclosures jumped to a record in the first quarter, led by subprime borrowers, according to the U.S. Mortgage Bankers Association.

I think the wost is over!