"Fannie Mae expects to remain profitable on an annual basis for the foreseeable future," the government-sponsored enterprise stated this morning as part of its third quarter earnings report.
So where do the profits go before they head to the Department of the Treasury, as stipulated by the government's conservatorship agreements?
Fannie Mae is in an extended period of technical investments with the private sector, Fannie Mae CEO Timothy Mayopoulos told me on the phone this morning. And Mayopoulos said that the GSE plans to continue on this path. Recent vendor lists on Day 1 Certainty, the GSE's flagship technology offering, are impressive and will continue to grow.
For mortgage tech service providers, working with Fannie Mae is a #1 priority; see the first sentence of this blog if any of you question why.
The company made $3 billion in revenue and plans to turn over as much to the Treasury. In the mean time, research and development continues at a furious pace within the company as “we continue to look at the points of friction and pain for mortgage lenders and servicers,” Mayopoulos told me this morning.
“There is no big bang solution, we continue to democratize our solutions across the market,” he added. “It’s now technically possible to get to a fully digital mortgage.” (For more information on the digital mortgage revolution, click here.)
Mayopoulos adds that Fannie Mae remains focused on trying to address frictions in the mortgage finance space.
So what does all this mean? Fannie Mae is not just actively engaging with private vendors on the origination side. Indeed, the company intends to ramp up similar activities on the servicing side.
While it’s too soon to speak about specifics, by Fannie Mae’s own admission development on the origination side outpaces that of servicing, there's changes on the horizon. “We are devoting attention to servicing, we are in the exploration process now,” Mayopoulos said.