Fannie Mae's third-quarter loss widened to $5.09 billion as the mortgage company reported higher derivatives losses even though it set less money aside for bad loans.
Fannie Mae and Freddie Mac were taken over by the government in 2008 at the height of the credit crisis. The companies' shares began trading on the over-the-counter market last year after regulators ordered them to delist from the New York Stock Exchange because they no longer met listing standards.
In the fourth quarter of last year, Fannie Mae posted a slight profit to snap a streak of 13 straight quarterly losses, though it swung back into the red in the first quarter and widened its loss in the second. Sliding delinquency rates have eased the company's need to set aside money for loan losses, but a weak housing market has made it difficult for Fannie to turn a profit.
In the latest quarter, Fannie Mae said losses on risk-management derivatives caused $4.53 billion of net fair value losses, compared with $525 million of net fair value gains a year ago.
Last week, Freddie Mac also posted a wider third-quarter loss as derivatives losses increased and the weak housing market weighed on results. The company also requested an additional $6 billion in federal aid, bringing the total amount of government aid it has requested to more than $70 billion since the financial crisis.
Fannie's provision for credit losses and foreclosed-property expenses fell to $4.88 billion from $5.56 billion a year earlier. Its provision for loan losses narrowed to $4.16 billion from $4.7 billion a year ago.
Fannie posted a loss of $5.09 billion, compared with a year-earlier loss of $1.34 billion. Including preferred-dividend payments to the Treasury Department, the loss was $7.58 billion, or $1.32 a share, compared with $3.46 billion, or 61 cents a share, a year earlier. Net revenue rose 7.8% to $5.48 billion.