Fannie Mae Q1 $13.1 BILLION loss and requests another $8.4 BILLION

WASHINGTON, DC – Fannie Mae (FNM/NYSE) reported a net loss of $11.5 billion in the first quarter of 2010, compared with a net loss of $15.2 billion in the fourth quarter of 2009. Including $1.5 billion of dividends on our senior preferred stock held by the U.S. Department of Treasury, the net loss attributable to common stockholders was $13.1 billion, or ($2.29) per diluted share, compared with a loss of $16.3 billion, or ($2.87) per diluted share, in the fourth quarter of 2009. Our first-quarter results were driven primarily by credit-related expenses, which remain at elevated levels due to weaknesses in the economy and the housing market.

Credit losses increased to $5.1 billion in the first quarter of 2010 from $4.1 billion in the fourth quarter of 2009, reflecting the increase in the number of defaults, which was partially offset by a slight reduction in loss severity. Credit losses remained substantially lower than our credit-related expenses during the first quarter of 2010 due partly to our home retention and foreclosure alternative efforts and partly to changes in the foreclosure process in a number of states and foreclosure processing backlogs in some jurisdictions.

Due to current trends in the housing and financial markets, we continue to expect to have a net worth deficit in future periods, and therefore will be required to obtain additional funding from Treasury pursuant to the senior preferred stock purchase agreement.

We acquired 61,929 single-family real estate-owned properties through foreclosure in the first quarter of 2010, compared with 47,189 in the fourth quarter of 2009. As of March 31, 2010, our inventory of single-family real estate owned properties was 109,989, compared with 86,155 as of December 31, 2009. The carrying value of our single-family REO was $11.4 billion, compared with $8.5 billion as of December 31, 2009.
Link to Fannie Mae Report

Fannie Mae expects the level of multifamily defaults and serious delinquencies to increase further during 2010. The company also said there is uncertainty regarding future of business after conservatorship terminated and expect this uncertainty to continue.