Fannie Mae reports $6.5B loss for fourth-quarter 2017

As a result of $3.7 billion deficit, the government-sponsored entity will request taxpayer infusion from Treasury Department

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Inman Connect San Francisco, Jul 16-20, 2018

Fannie Mae on Wednesday reported a fourth-quarter 2017 net loss of $6.5 billion, a steep year-over-year decline that the government-sponsored, publicly traded entity attributed to a one-time accounting charge brought on by changes to the tax code that passed into law in December. For full-year 2017, Fannie Mae posted a net income of $2.5 billion, down from $12.3 billion in 2016. The changes in income for the fourth quarter and full year, which plunge Fannie Mae into a $3.7 billion deficit, were driven primarily by a $9.9 billion provision outlined in the “Tax Cuts & Jobs Act” that remeasured the entity’s deferred tax assets using a lower corporate rate. That lower rate, estimated at 20 percent, is expected to benefit Fannie Mae in 2018, officials said in the Wednesday report. “Our 2017 results demonstrate that the fundamentals of our business are strong,” said Timothy Mayopoulos, the president and chief executive of Fannie Mae, in a prepared statement. “While the fo...