Mortgage giant Fannie Mae (FNM: 1.06, 0.04, 3.92%) bled another $13.1 billion during the first quarter, prompting the U.S.-owned company to request another $8.4 billion cash infusion from the Treasury Department.
Fannie Mae, which was placed into conservatorship in 2008 amid enormous mortgage losses, said it lost $13.1 billion, or $2.29 a share, last quarter, compared with a loss of $16.3 billion, or $2.87 a share, during the fourth quarter of 2009.
The company blamed the heavy losses on credit-related expenses that remain “at elevated levels” due to weakness in the U.S. economy and the housing market.
“In the first quarter we continued to serve as a leading source of liquidity to the mortgage market, and we made solid progress in our ongoing efforts to keep people in their homes,” CEO Mike Williams said in a statement.
Fannie said it purchased or guaranteed about $191.4 billion in loans during the first quarter and completed 94,000 loan modifications. The company said its purchases and guarantees financed about 516,000 conventional single-family loans and about 61,000 multifamily units.
Due to the heavy losses, Fannie said the Federal Housing Finance Agency has asked the Treasury Department for $8.4 billion on or before June 30. Fannie already received $15.3 billion at the end of 2009. Last week sister company Freddie Mac said it would need another $10.6 billion from the government.
Fannie didn’t shy away from saying it will continue to need cash, saying, “Due to current trends in the housing and financial markets, we continue to expect to have a net worth deficit in future periods, and therefore will be required to obtain additional funding from Treasury.” - FOX News Story
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