WASHINGTON (AP) — Mortgage giant Fannie Mae is reporting net income of $3.9 billion for the July through September period, down 55 percent from a year ago. But it still plans to pay slightly more than it earned in the latest quarter to the federal government as a dividend.
It was the 11th straight profitable quarter for the government-controlled company. But the third-quarter profit was down 55 percent from $8.7 billion a year earlier.
Earnings for Fannie and its smaller sibling Freddie Mac can fluctuate widely due to changes in interest rates and home prices. Fannie said Thursday it expects to remain profitable “for the foreseeable future.”
Washington-based Fannie also said it will pay a dividend of $4 billion to the U.S. Treasury next month. With its previous payments totaling $134.5 billion, Fannie has more than fully repaid the $116 billion it received from taxpayers during the financial crisis.
The government rescued Fannie and Freddie in September 2008.
Fannie’s third-quarter net revenue slipped to $6 billion from $6.3 billion a year earlier. Fannie said its revenue was boosted in the latest quarter by net interest income and payments the company continued to collect from major banks in settlements resolving U.S. claims that they misled Fannie about risky mortgage securities they sold before the housing market collapsed in 2007.
Fannie and Freddie own or guarantee about half of all U.S. mortgages, worth about $5 trillion. Along with other federal agencies, they back roughly 90 percent of new home loans.
The two companies don’t directly make loans to borrowers. They buy mortgages from lenders, package them as bonds, guarantee them against default and sell them to investors. That helps make loans available.
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