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Fannie Mae loses 2.9B in 2011 second quarter
WASHINGTON (8/8/11)—Loan modifications contributed, in part, to Fannie Mae’s reported $2.9 billion in losses for the second quarter of 2011, but Chief Financial Officer (CFO) Susan McFarland said that the government-sponsored mortgage entity would continue to work with borrowers. Noting that the modifications should “benefit the housing market and reduce long-term credit losses,” the Fannie Mae CFO added that “while modifications contribute to credit related expenses, successful modifications reduce foreclosures and keep families in homes.” Modifications, repayment plans, and other foreclosure-avoidance measures have been worked out with more than 874,000 homeowners between Jan. 1, 2009 and June 30, 2011, Fannie Mae said. Fannie Mae in a Friday release said that the second quarter losses reflected $6.1 billion in credit-related expenses, the majority of which were related to assets that the company has held since before 2009. Continued weakness in housing and mortgage markets also contributed to the loss, Fannie Mae added. Fannie Mae purchased or guaranteed $306 billion in loans during the first half of 2011, helping to finance 1.238 million single-family conventional mortgages. It issued 43.2% of all mortgage-related securities in the secondary market during the second quarter, remaining the largest issuer of those types of securities. The mortgage entity said plans to borrow $5.1 billion from the U.S. Treasury to eliminate its net worth deficit. It has borrowed nearly $104 billion from the Treasury since the fourth quarter of 2008. For Fannie Mae’s full results for the second quarter of 2011, use the resource link.
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