Fannie Mae hits $7.6bn profits for the quarter

Michael Bow
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US MORTGAGE finance outfit Fannie Mae, which is controlled by the US government, yesterday posted a $7.6bn (£5bn) quarterly profit, giving the firm its first year in the black since 2006.

The company, which owns or guarantee $5.2 trillion in mortgages and around 90 per cent of all US home loans, recorded annual profits of $17.2bn for the 2012 financial year, it said yesterday.

However, Fannie Mae decided against booking deferred tax credits as assets. This would have meant the company would have had to repay up to $58.9bn to US taxpayers.

The bumper year of profits makes Fannie Mae one of the biggest earners in corporate America, outstripping profits at top S&P 500 companies.

“We expect to remain profitable for the foreseeable future,” chief executive Timothy Mayopoulos said.

“It’s a very good thing for taxpayers, but there’s still an important task in front of policy makers to determine what structure they want to have for the future housing finance system, what institutions they want to have playing the various roles in that system and then figuring out how to attract private capital.”

Fannie Mae was taken under government control in 2008 amid the financial crisis.