Fannie Mae Could Receive A $3.7B Cash Infusion, The First In Six Years

Mortgage-finance giant Fannie Mae experienced a $6.5B net loss in Q4 as a result of the new lowered corporate tax rate.

This drop could prompt the Federal Housing Finance Agency to seek a taxpayer infusion of $3.7B from the Treasury Department — the first cash infusion the company has received in six years, the Wall Street Journal reports.

The WSJ attributes the need for the cash infusion to a one-time accounting charge linked to lower corporate tax rates, which fell from 35% to 21% under the new law.

Both Fannie Mae and Freddie Mac were placed under government conservatorship in the second half of 2008 after receiving a bailout of more than $185B to prevent a collapse. Terms of the conservatorship require the mortgage companies to send the majority of their profits to the government at the end of each quarter, with the exception of a set buffer — meaning the company functions with limited capital.

Following the infusion, Fannie will have provided the Treasury Department with $166.4B, while it has received $119.8B, according to the WSJ.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

JVP Development Is Betting $37M Of Its Own Money That Frisco Is Ready For Spec Office

Wall Street Impatient For Big Tech Returns On Data Center Spending

As AI Adoption Ramps Up, Half A Million Property Managers Are In The Crosshairs

Treasuries Hover Around 4.7% As Wall Street Questions If Warsh Is A 'Dove In Hawk's Clothing'

Avison Young Had Assets Frozen By Bank Over Unpaid Taxes

Camden Property Trust Sells West Coast Portfolio, Clears $1.5B Target

Churchill Downs Plans To Sell 9 Casinos, Focus On Horse Racing

Bringing Stability And Savings To CRE Insurance Through Working Layer

More Hotel Owners In Need Of Cash Are Getting It From The Big Brands

Former Arms Dealer Targeting Heartland Apartment Takeover Files For Bankruptcy

SEC Charges REIT, Its Founders With Alleged $152M Fraud Scheme

Equinix Ramps Up Spending Plans Amid Faster-Than-Expected AI Shift