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Announcement may have pleased investors
Fannie Mae (FNMA/OTC) reported net income of $10.1 billion for the second quarter of 2013, compared with net income of $5.1 billionfor the second quarter of 2012.
The company’s net income for the second quarter of 2013 was the company’s sixth consecutive quarterly profit. Fannie Mae reported comprehensive income of $10.3 billion for the second quarter of 2013, compared with comprehensive income of $5.4 billion for the second quarter of 2012.
Fannie Mae reported a positive net worth of $13.2 billion as of June 30, 2013 and will pay $10.2 billion to US taxpayers as a dividend on the senior preferred stock.
The lender reported a strong second quarter in 2013 driven primarily by continued stable revenues and boosted by a significant increase in home prices in the quarter, which resulted in a reduction in the company’s loss reserves.
Year-over-year improvement was due primarily to 1) gains on Fannie Mae’s assets recorded at fair value in the second quarter of 2013 as a result of increases in interest rates, compared with fair value losses in the second quarter of 2012, and 2) an increase in credit-related income. Fannie Mae expects to remain profitable for the foreseeable future.
While the company expects its revenues to be stable and its annual earnings to remain strong over the next few years, its earnings may vary significantly from quarter to quarter due to many dif ferent factors, such as changes in interest rates or home prices.
In addition to dividend payments, the company expects to make substantial federal income tax payments to the US Treasury going forward.
