Fannie Mae’s first-quarter net income hit $5.3 billion, the enterprise’s ninth consecutive quarterly profit.

Fannie also posted a comprehensive income of $5.7 billion for the first quarter of 2014.

The key financial drivers of the company’s profits were guaranty fees and declining revenues attributable to the company’s retained mortgage portfolio.

In addition, Fannie’s earnings were boosted by $4.1 billion in revenue from settlement agreements in the first quarter relating to private-label mortgage securities sold to Fannie Mae.

The company also benefited from $1 billion in credit-related income, offset by fair value losses of $1.2 billion as a result of a decrease in longer-term interest rates during the first quarter of 2014.

Fannie Mae expects to pay Treasury $5.7 billion in dividends in June 2014, and with the expected June dividend payment, Fannie Mae will have paid a total of $126.8 billion in dividends to Treasury in comparison to $116.1 billion in draw requests since 2008.

While the capital reserve amount currently is $2.4 billion for each quarter of 2014, it will be reduced by $600 billion each year until it reaches zero in 2018.

This in turn still leaves the taxpayer in the first loss position since Fannie has no capital cushion as a buffer, according to Dave Benson, executive vice president and chief financial officer with Fannie Mae.

Looking ahead, while Fannie expects to remain profitable in the future, it does expect its annual net income to be substantially lower than its net income for 2013.

But both Benson and Tim Mayopoulos, president and CEO of Fannie Mae, emphasized on Fannie's earnings call that they can’t control the external environment, like interest rates and home prices.

Benson explained that if costs exceed revenue, it will result in a Treasury draw, and while they don’t foresee it long-term, the taxpayer is still in the first loss position.  

“As we look at the environment going forward we can express the sentiment that we will be profitable,” he said. “The industry is moving to a normalized environment in terms of underwriting standards and credit standards.”