Fannie Mae Posts $5.1 Billion Income, Needs No Treasury Capital

Yesterday came the news that Freddie Mac posted a quarterly profit and that the mortgage giant would not need to tap any Treasury capital. Now we are getting the same sort of report from the larger Fannie Mae.

If you can believe it, Fannie Mae’s net income was $5.1 billion for the second quarter of 2012, and that tallies up to $7.8 billion for the first half of 2012. The quasi-agency’s new book of business was said to account for some 59% of single-family guaranty book of business as of June 30, and the group said that single-family serious delinquency rates have now declined for nine consecutive quarters.

Fannie Mae noted that the improvement was “almost entirely due to credit-related income, resulting primarily from an improvement in home prices, improved sales prices on the company’s real-estate owned properties, and a decline in the company’s single-family serious delinquency rate.” Its comprehensive income of $5.4 billion in the second quarter is sufficient to pay a $2.9 billion dividend to the Treasury.

No request for Treasury capital this quarter … Fannie Mae’s net worth was $2.8 billion as of June 30, after the total comprehensive income of $5.4 billion and after the $2.9 billion in senior preferred stock dividends paid to the Treasury.

JON C. OGG