Investments

Fannie Mae reports annual net income of $12.3 billion

Nearly half going to Treasury

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Fannie Mae reported annual net income of $12.3 billion and annual comprehensive income of $11.7 billion in 2016.

For the fourth quarter of 2016, Fannie Mae reported net income of $5 billion and comprehensive income of $4.9 billion.

This means growth remained flat at the government-sponsored enterprises, with net income levels similar for last year/quarter. That said, the company can still be considered as on a hot streak.

"The decrease in annual net interest income was due primarily to lower net interest income from the company’s retained mortgage portfolio, almost entirely offset by an increase in guaranty fee income," the company said in a release.

The company also reported a positive net worth of $6.1 billion as of December 31, 2016.

As a result of the quarter's earnings, the company expects to pay Treasury a $5.5 billion dividend in March 2017.

 “We delivered new technologies that reduce risk and cost for our single-family customers and help them make the mortgage process simpler, more certain, and easier for borrowers,” said Timothy Mayopoulos, president and chief executive officer.

Fannie Mae expects to remain profitable on an annual basis for the foreseeable future. however, the company states that due to the company’s limited and declining capital reserves (which decrease to zero in 2018) and the potential for significant volatility in its financial results, it could experience a net worth deficit in the future.

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