On the backdrop of an eighth consecutive quarterly loss, Fannie Mae, the US-based mortgage-finance firm that got lifeline from the US government, urged the Treasury to provide with $10.7 billion capital investment – reported Bloomberg.
The 2009 second quarter loss of $14.8 billion drove the Washington-based troubled mortgage lender’s net worth to below zero once again, and forced it to file for Treasury help for the third time. Second-quarter results brought the firm’s cumulative losses for the past two years to $101.6 billion and, at the same time, the credit quality of mortgage bonds and loans the lender guarantees, have also deteriorated.
In its filing to the Securities and Exchange Commission, the company said: “We do not expect to operate profitably in the foreseeable future. We expect that we will experience adverse financial effects as we seek to fulfill our mission by concentrating our efforts on keeping people in their homes and preventing foreclosures,” reported the newspaper.
Fannie Mae and its Virginia-based rival Freddie Mac, which guarantee close to 50% of US residential mortgage debt, are crucial to President Obama’s strategy to rescue homeowners.
