Record Q1 Profit for Fannie (FNMA) is Boon for U.S. Taxpayers

May 9, 2013 11:32 AM EDT
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Fannie Mae (OTCBB: FNMA) shares are trading strong Thursday following issuance of its first quarter 2013 report earlier.

The mortgage-finance company reported pre-tax income of $8.1 billion, the largest in company history. Comprehensive income was $59.3 billion, versus $3.1 billion in the same period last year.

The single-family delinquency rate slipped to 3.02 percent for the quarter, versus 3.67 percent in Q112 and 3.29 percent in the preceding period.

Benefiting from the results will be the U.S. Treasury. Fannie Mae said it "will pay Treasury $59.4 billion in dividends in the second quarter of 2013, which reflects the company’s net worth as of March 31, 2013 less the $3.0 billion capital reserve applicable in 2013 under the terms of the senior preferred stock purchase agreement. The company expects to remain profitable for the foreseeable future."

Fannie received $116.1 billion in aid from the U.S. roughly five-years ago and will have paid $95 billion back inclusive of the latest news. Peer GSE Freddie Mac (OTCBB: FMCC) will pay $7 billion in dividends during June, bringing its total to $36.6 billion, versus the $71.3 billion in aid it received during the housing crisis.

By the end of June, the net government cost will have been cut in half from $120 billion at the end of March to just $60 billion.

Fannie is up about 5 percent on the session.

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