Fannie Mae wants $5.1 billion more from Treasury to eliminate deficit

By Angela McDaniels

Tacoma, Wash., Aug. 5 - Fannie Mae will request another $5.1 billion from the Treasury under its senior preferred stock purchase agreement, according to the agency's second-quarter earnings release.

The funds will be used to eliminate the company's net worth deficit, which was $5.1 billion as of June 30.

The draw will increase the total amount of preferreds issued to the Treasury to $104.8 billion. The dividends payable on these preferreds will total $10.5 billion per year, which exceeds the company's reported annual net income for each year since its inception.

Since entering into conservatorship in September 2008, the company has made $14.7 billion of dividend payments to the Treasury.

Fannie Mae said the June 30 net worth deficit reflects the recognition of its total comprehensive loss of $2.9 billion and its payment to the Treasury of $2.3 billion of dividends during the second quarter.

For the second quarter, Fannie Mae reported a net loss of $2.9 billion, compared with a net loss of $6.5 billion in the first quarter.

Net revenues were flat at $5.2 billion in the second quarter.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.