Fannie Mae requests $15.3 billion from Treasury, loses billions
After posting losses of more than $16 billion in the fourth quarter, Fannie Mae has requested $15.3 billion in additional funding from the United States Treasury.
On Friday, Fannie Mae, the largest provider of residential mortgages, reported losses of $16.3 billion in the fourth quarter of 2009, which prompted the government-controlled company to request $15.3 billion from the United States Treasury, according to the Business Journal
. For the entire year of 2009, Fannie Mae lost $74.4 billion compared to $59.8 billion in the previous year.
Fannie Mae explained the quarterly losses occurred because of the rising defaults, which prompted credit-related expenses to rise to $11.9 billion. The mortgage company also said it identified a $5 billion loss from the write-down of its investments in low-income tax credit partnerships.
reports that Fannie Mae expects the losses to continue for future periods. “We expect to have a net worth deficit in future periods, and therefore will be required to obtain additional funding from Treasury,” the company said in a statement.
“We continue to work closely with our industry partners and the government to reach every borrower we can and to address rising foreclosure. Our overriding objective is keeping people in their homes whenever possible," said Michael Williams, Fannie Mae’s Chief Executive, reports the Epoch Times
The Obama is expected to announce a long-term plan for both Fannie Mae and Freddie Mac within the year.