Fannie and Freddie Request Funds from Treasury after Reporting Losses

For the first time since 2012, both Fannie Mae and Freddie Mac require funds from Treasury to cover quarterly losses. Fannie Mae’s reported earnings showed a net loss of $6.5 billion for the fourth quarter of 2017, attributed in part to a re-measurement of the company’s deferred tax assets following the large tax package passed at the end of 2017. Fannie Mae expects to request $3.7 billion from Treasury to eliminate its deficit. Likewise, Freddie Mac reported a $3.3 billion loss and will require $300 million from Treasury. Fannie and Freddie have both indicated that they will continue to contribute to affordable housing trust funds on the grounds that their deficits are due to one-time tax losses and don’t suggest any underlying financial instability.