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Fannie Mae’s 1Q income nosedives

Shortfall could impact proposal to increase CEO compensation

Government-sponsored enterprise Fannie Mae released its first-quarter earnings report this week, revealing that it earned $1.9 billion in net income, down 64 percent from $5.3 billion the company reported in the first quarter of 2014. The GSE’s net income fell short of analysts’ expected reporting of $2.6 billion. Fannie Mae attributed the sharp drop to a sizable derivative loss and a drop in credit-related income. Fannie Mae reported a positive net worth of $3.6 billion during the first quarter, and it will send the U.S. Treasury $1.8 billion in June. The company received $116.1 billion in bailout funds from the federal government after being placed into conservatorship in 2008 following the financial crisis. Despite the poor performance, the Federal Housing Finance Agency (FHFA), Fannie Mae’s regulator, said earlier this week that it is considering raising the CEO compensation for both Fannie Mae and Freddie Mac. CEOs at both companies each earned $600,000 in salar...