Russia on Monday rejected claims by former U.S. Treasury secretary Hank Paulson that it had attempted to destabilize the U.S.'s largest mortgage finance institutions.

In his memoirs, On the Brink, extracts from which were published by The Financial Times, Paulson claimed that Russia proposed to China that the two nations should sell Fannie Mae and Freddie Mac bonds in 2008 to force their bailout by the U.S. government.

Paulson said he was told about the Russian plan while in Beijing for the Olympics in early August 2008. He also said that China declined to go along with the plan.

"Russia at that time was a country that invested huge funds in these organizations and was not interested in rocking these institutions," Dmitry Peskov, press secretary of the Russian premier, said.

Peskov added that this fact was well-known to Russia's U.S. partners, who had repeatedly expressed gratitude to Moscow for its timely and considered actions.

The U.S. government-sponsored firms, which together owned or guaranteed $5 trillion in U.S. mortgage debt or almost 40% of the market, were taken over by a federal regulator early in September 2008 to prevent their possible collapse amid the growing credit crunch.

Russia's holdings in the troubled U.S. mortgage finance institutions amounted to over $65 billion in 2008 and were fully redeemed by early 2009.

MOSCOW, February 1 (RIA Novosti)