Fannie Mae, the largest provider of funding for US residential mortgages, today said it lost a record $29 billion in the third quarter as the company wrote down a tax-related asset that has buoyed capital and the housing slump deepened.
The quarterly loss is the fifth consecutive for the Washington-based mortgage finance company that has been operating under a government conservatorship since September.
Fannie Mae in October warned it would write down "substantially all" of its deferred tax assets, which had become a controversial addition to capital as losses mounted. Deferred tax assets can be used to offset future taxes, but only if the company can show it will return to profitability.
Credit expenses soared to $9.2 billion in the quarter due to deteriorating mortgage credit conditions and as home prices declined, the company said.
Fannie Mae's loss equalled $13 per share, compared with a loss of $1.4 billion, or $1.56 per share a year earlier.
Reuters
