NEW YORK—Mortgage finance giant Fannie Mae on Wednesday said that the government-sponsored company made its first quarterly profit since 2008.
The company said that it made $2.7 billion in the quarter from January to March. By comparison, last year during the same quarter Fannie was in the red by a whopping $6.5 billion.
In addition, Fannie Mae will not seek additional aid money from taxpayers, and will instead pay a $2.8 billion dividend to the U.S. Department of Treasury. This is the first period since 2008 in which the Washington-based Fannie did not request additional taxpayer aid.
“Our financial performance has improved significantly and we successfully limited losses on the legacy book of business through our efforts to help homeowners avoid foreclosure,” said Fannie CEO and President Michael Williams in a statement.
The company’s CFO, Susan McFarland, expects 2012 performance to be “significantly better” than in 2011.
Fannie’s fortunes have been on the upswing over the last year or so due to a recovering real estate market, with slowing home price declines, and fewer foreclosures and delinquencies.
Largest Bailout
Fannie Mae, which received almost $120 billion in bailout money, was the single most expensive bailout during the 2008 financial crisis.
Fannie was put under federal conservatorship in September 2008 after the housing crisis escalated and billions of dollars worth of mortgages guaranteed by Fannie had soured.
Together, Fannie and Freddie Mac—which required its own bailout in 2008—have cost U.S. taxpayers more than $170 billion to prop up. Freddie last week said that it needed $19 million from Congress in additional aid, which is a relatively small amount. In four previous fiscal quarters since 2008, Freddie did not require aid.
Together, Fannie and Freddie guarantee around half of all U.S. mortgages, exceeding $5 trillion in market value.
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