Fannie Mae reported annual net income of $14.2 billion and annual comprehensive income of $14.7 billion in 2014.

This compares to net income of $84.0 billion and comprehensive income of $84.8 billion in 2013, which included the release of the company’s valuation allowance against its deferred tax assets.

Fannie Mae paid a total of $20.6 billion in dividends to Treasury in 2014. The company expects to pay Treasury $1.9 billion in dividends in March 2015. With the expected March 2015 dividend payment, the company will have paid a total of $136.4 billion in dividends to Treasury. Dividend payments do not reduce prior Treasury draws, which total $116.1 billion since 2008. 

“Fannie Mae had another strong year of financial performance. We continued to manage our business effectively, put the legacy issues from the financial crisis behind us, and implement innovations to lead the industry toward a sustainable housing finance system for today and the future,” said Timothy Mayopoulos, president and chief executive officer. “We are committed to serving our partners and focused on reducing barriers to lending to qualified borrowers.”

Fannie Mae’s 2014 results were driven by strong revenues from net interest income and income from settlement agreements related to private-label mortgage-related securities sold to Fannie Mae, as well as credit-related income due primarily to increasing home prices during the year.

These results were partially offset by a provision for federal income taxes and fair value losses on risk management derivatives due to declines in longer-term interest rates in 2014. Fannie Mae recognized a provision for federal income taxes of $6.9 billion for the year ended 2014, which resulted in an effective tax rate of 32.8 percent. Fannie Mae’s net income of $1.3 billion and comprehensive income of $1.3 billion for the fourth quarter of 2014 compares to net income of $3.9 billion and comprehensive income of $4.0 billion for the third quarter of 2014.

Fannie Mae’s fourth quarter results were driven by net interest income, partially offset by fair value losses on risk management derivatives due to declines in longer-term interest rates in the quarter.

Net revenues, which consist of net interest income and fee and other income, were $5.5 billion for the fourth quarter of 2014, compared with $6.0 billion for the third quarter of 2014. For the year, net revenues were $25.9 billion, compared with $26.3 billion in 2013.

Net interest income, which includes guaranty fee revenue, was $5.1 billion for the fourth quarter of 2014, compared with $5.2 billion for the third quarter of 2014. For the year, net interest income was $20.0 billion for 2014, compared with $22.4 billion for 2013. The decrease in net interest income compared to 2013 was due primarily to lower interest income from retained mortgage portfolio assets due to a decline in the size of the company’s retained mortgage portfolio, partially offset by an increase in net interest income from guaranty fees.

An increasing portion of Fannie Mae’s net interest income in recent years has been derived from guaranty fees rather than from interest income earned on the company’s retained mortgage portfolio assets. This is a result of both the shrinking of the retained mortgage portfolio and the impact of guaranty fee increases.

Fee and other income was $323 million for the fourth quarter of 2014, compared with $826 million for the third quarter of 2014.

Fee and other income decreased in the fourth quarter compared with the third quarter due to income recognized by the company in the third quarter of 2014 from settlement agreements related to private-label mortgage-related securities sold to Fannie Mae. For the year, fee and other income was $5.9 billion for 2014, compared with $3.9 billion for 2013. The increase in fee and other income for the year was due primarily to an increase in the amount of income recognized by the company from settlement agreements related to private-label mortgage-related securities sold to Fannie Mae.