NEW YORK (Reuters) - Municipal Mortgage & Equity LLCMMAB.PK (MuniMae), which arranges financing for developers and real estate owners, said on Monday it would suspend its dividend and stick to loans it can sell to Fannie Mae (FNM.N: Quote, Profile, Research) or Freddie Mac (FRE.N: Quote, Profile, Research) to survive the credit crisis.

"The suspension of the company's dividend distribution is being done to conserve capital to protect the long-term prospects of the business, given the current dislocation of the credit and debt capital markets and its impact on MuniMae's business," the company said in a statement.

MuniMae, based in Baltimore, Maryland, was in the business of arranging debt and equity financing for developers and owners of real estate and clean energy projects.

Soaring mortgage defaults in the housing market set off a broader credit crisis, which has effected the value of some of MuniMae's assets and prompted financial institutions to refrain from participating in some of MuniMae's deals as lenders or equity investors.

MuniMae said it would continue to originate loans for sale to Fannie Mae and invest in activities related to renewable energy generation.

For the first quarter, the company, which has more than $19 billion in assets under management, said production fell to $432 million, compared with $738 million a year earlier.

"While we typically experience lower production in our first quarter, these results reflect the extremely difficult operating environment that the company is operating in," Michael Falcone, the company's chief executive, said in a statement.

The company shares were down 7.27 percent, or 33 cents, at $4.21 in early afternoon trading on Monday. MuniMae's shares reached at 12 month low of $3.75 on April 30.

(Reporting by Ilaina Jonas, Editing by Toni Reinhold)