Fannie Mae released its second quarter earnings on Thursday, which boasted industry-high gains. The government-sponsored enterprise reported $3.2 billion in net income, and $3.1 billion in comprehensive income. This sum is approximately $500,000 greater than the recorded income for the first quarter of 2017, which was $2.8 billion.
The GSE attributes this increase in income to credit-related revenue, as well as a shift to investment gains as opposed to investment losses Fannie saw in the first quarter. Further, its contribution to the Treasury in the form of dividends amounted to $2.8 billion for the month of June. Through the second quarter of the year, Fannie Mae has paid a total of $162.7 billion to the Treasury in dividends, and expects to pay an additional $3.1 billion in September if the Federal Housing Finance Agency calls in a dividend.
Fannie Mae, in addition, provided $135 billion of liquidity to the mortgage industry in an attempt to enable families to buy, refinance, or rent homes, making them the largest provider in the industry.
The lender has also made an exceptional business change in the last three months in transitioning from a portfolio-based business to a guaranty-focused business—the latter has accounted for 75 percent of the company’s net income for the first half of 2017. They estimate that that figure will continue to increase through the rest of the year as they work to reduce their retained mortgage portfolio.
Fannie Mae continues to contribute to the housing finance system by reducing risk to lenders and making long-term fixed-rate mortgages accessible to people across the country. They pledge to continue to increase their role in credit risk transaction. As of June 30, 2017, they’ve covered nearly $798 billion of unpaid principle balance in single-family mortgages, which accounts for 28 percent of the loans in their guaranty book of business.