Page 25 - February 2018 Disruption Report Flip Book

FANNIE MAE JAN.U-FAERBY. 2018
FANNIE MAE
Fannie Mae reports $6.5 billion loss for fourth quarter, caused by write-off of $9.9 billion of deferred tax assets
Fannie Mae reported a net loss of $6.5 billion for the fourth quarter, triggered by the reevaluation of its deferred tax assets (DTA) under the 2017 tax reform legislation and write-off of $9.9 billion DTAs. As a result, Fannie Mae reported a negative net worth of $3.7 billion. The Federal Housing Finance Agency is expected to request $3.7 billion in assistance to eliminate the GSE’s net worth deficit.
SUMMARY OF RESULTS OF OPERATIONS
Since 2003, Fannie Mae has transferred a portion of the credit risk on single-family mortgages with an unpaid principal balance of more than $1.2 trillion, measured at the time of the transactions, including more than $390 billion in 2017. On December 31, 2017, $922 billion
in single-family mortgages or approximately 32% of the loans in the company’s single-family conventional guaranty book of business, measured by unpaid principal balance, were covered by a credit risk transfer transaction.
“Our 2017 results demonstrate that the fundamentals of our business are strong. While the fourth quarter was affected by a one-time accounting charge, we expect to benefit from a lower tax rate going forward,” said CEO Timothy Mayopoulos
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