FBD
05-09-2011, 07:34 PM
http://www.abcmoney.co.uk/news1/Fannie-Mae-seeks-$8.5-billion-from-taxpayers-----%28Reuters%29,204277.htm
WASHINGTON (Reuters) – Mortgage finance giant Fannie Mae (FNMA.OB) on Friday said it would ask for an additional $8.5 billion from taxpayers as it continues to suffer losses on loans made prior to 2009.
The largest U.S. residential mortgage funds provider reported a net loss attributable to common shareholders of $8.7 billion, or $1.52 per diluted share, in the first quarter.
Including the latest request, the firm has taken about $100 billion from the U.S. government since it was seized in 2008, though it has also paid about $12.4 billion to taxpayers in interest.
Loans made in the past two years have been more profitable than loans made during the housing boom in preceding years.
"As we move forward, we are building a strong new book of business that now accounts for 45 percent of the company's overall single-family guaranty book of business," said Michael Williams, the firm's president and chief executive officer.
Sibling firm Freddie Mac (FMCC.OB) said on Wednesday it lost just under a billion dollars in the first three months of the year, though the second-largest provider of mortgage funds did not request any new money from the government.
The two firms together have asked for about $164 billion, though their net payments have been reduced to about $140 billion as a result of the interest payments, including the latest request.
Then-U.S. Treasury Secretary Henry Paulson took control of Freddie Mac and Fannie Mae at the height of the financial crisis in September 2008 as losses mounted from mortgages gone bad.
The plan to put them into conservatorship was meant to be temporary, although it is likely to be years before a long-term replacement structure takes shape.
The two firms and the Federal Housing Administration back close to nine of 10 new home loans after private mortgage funding dried up in the wake of the financial crisis.
---------------------------------
But wait, wasnt Dodd-Frank supposed to prevent this?
And who can forget Bawney telling everyone everything is fine with f&f
http://online.wsj.com/article/SB122290574391296381.html
House Financial Services Committee hearing, Sept. 10, 2003:
Rep. Barney Frank (D., Mass.): I worry, frankly, that there's a tension here. The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios. . . .
[What They Said] AP
Rep. Maxine Waters (D., Calif.), speaking to Housing and Urban Development Secretary Mel Martinez:
Secretary Martinez, if it ain't broke, why do you want to fix it? Have the GSEs [government-sponsored enterprises] ever missed their housing goals?
* * *
House Financial Services Committee hearing, Sept. 25, 2003:
Rep. Frank: I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . .
WASHINGTON (Reuters) – Mortgage finance giant Fannie Mae (FNMA.OB) on Friday said it would ask for an additional $8.5 billion from taxpayers as it continues to suffer losses on loans made prior to 2009.
The largest U.S. residential mortgage funds provider reported a net loss attributable to common shareholders of $8.7 billion, or $1.52 per diluted share, in the first quarter.
Including the latest request, the firm has taken about $100 billion from the U.S. government since it was seized in 2008, though it has also paid about $12.4 billion to taxpayers in interest.
Loans made in the past two years have been more profitable than loans made during the housing boom in preceding years.
"As we move forward, we are building a strong new book of business that now accounts for 45 percent of the company's overall single-family guaranty book of business," said Michael Williams, the firm's president and chief executive officer.
Sibling firm Freddie Mac (FMCC.OB) said on Wednesday it lost just under a billion dollars in the first three months of the year, though the second-largest provider of mortgage funds did not request any new money from the government.
The two firms together have asked for about $164 billion, though their net payments have been reduced to about $140 billion as a result of the interest payments, including the latest request.
Then-U.S. Treasury Secretary Henry Paulson took control of Freddie Mac and Fannie Mae at the height of the financial crisis in September 2008 as losses mounted from mortgages gone bad.
The plan to put them into conservatorship was meant to be temporary, although it is likely to be years before a long-term replacement structure takes shape.
The two firms and the Federal Housing Administration back close to nine of 10 new home loans after private mortgage funding dried up in the wake of the financial crisis.
---------------------------------
But wait, wasnt Dodd-Frank supposed to prevent this?
And who can forget Bawney telling everyone everything is fine with f&f
http://online.wsj.com/article/SB122290574391296381.html
House Financial Services Committee hearing, Sept. 10, 2003:
Rep. Barney Frank (D., Mass.): I worry, frankly, that there's a tension here. The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios. . . .
[What They Said] AP
Rep. Maxine Waters (D., Calif.), speaking to Housing and Urban Development Secretary Mel Martinez:
Secretary Martinez, if it ain't broke, why do you want to fix it? Have the GSEs [government-sponsored enterprises] ever missed their housing goals?
* * *
House Financial Services Committee hearing, Sept. 25, 2003:
Rep. Frank: I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . .