Huge Loss At Fannie Mae Clouds GSE Bailout
WASHINGTON – Fannie Mae on Friday reported a loss of $6.5 billion for the first quarter and said it would request another $6.2 billion in government assistance.
The Fannie report, which came two days after Freddie Mac said it broke back into the black for the first quarter, was attributed to a weakening housing market.
So far, the federal government has pledged $138 billion in assistance to the two giants taken over in September 2009, with $86 billion for Fannie and $52 billion for Freddie.
Fannie's loss came as it increased its loan loss reserves after it revised down its home price forecast for 2011, and took bigger-than-expected losses on the sale of foreclosed properties. The secondary mortgage market giant reported $11 billion in credit-related expenses, up from $4.3 billion last quarter.
The rising losses came despite a decline in the share of single-family loans that were 90 days or more delinquent. Those fell to 4.27% at the end of March, down from 4.48% at the end of last year. Fannie has approximately $206 billion in delinquent loans on its books.