Fannie Mae Losses $18.9 Billion, Seeks More Aid

US Mortgage Giant Posts another Massive Quarterly Loss

Summary: Fannie Mae, the government-assisted US mortgage firm, on Thursday posted a massive $18.9 billion net loss in the third quarter of the year following massive buying of mortgage-backed securities trust.

The US Treasury Department said that it is now making important actions that would ensure the continuous operation of the company.

Government-controlled US mortgage firm Fannie Mae on Thursday reported another massive loss amounting to $18.9 billion in the third quarter of the year. The company is now seeking an additional $15 billion worth of government aid.

In a statement, Fannie Mae said that their net loss for the third quarter reached more than $18 billion but said that it was 35 percent lower than last year. The mortgage giant has also posted $14.8 billion loss last quarter bringing the total to more than $56.8 billion since it has been taken over by the government.

But officials of Fannie Mae said that the massive loss in the Q3 was due to the $22.0 billion credit-related expenditures of the company. “It will be recalled that the company has acquired mortgage-assisted securities trusts that would allow it to pursue its own loan modification scheme. But the increasing number of loans has made it difficult for the company to control the funding coming out,” an official familiar with the matter said.

The government has the mortgage giant to buy mortgage-backed securities following its collapse in the 2006, when the price bubble exploded.The US Treasury Department is now making the necessary steps to keep the company operating, including that of a $15 billion additional funding.

Fannie Mae Losses $18.9 Billion, Seeks More Aid

US Mortgage Giant Posts another Massive Quarterly Loss

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