Fannie Mae, the mortgage giant that was bailed out by taxpayers, reported a quarterly loss of $13.1 billion and said there are doubts about its long-term viability as it asked the Treasury Department for more money.
Fannie Mae said Monday that it lost $13.1 billion, or $2.29 a share, in the first quarter, compared with a loss of $23.2 billion, or $4.09, a year earlier.
"Our first-quarter results were driven primarily by credit-related expenses, which remain at elevated levels due to weaknesses in the economy and the housing market," the government-controlled mortgage-finance firm said.
Because the quarterly loss resulted in a deficit of $8.4 billion, the Federal Housing Finance Agency has asked the Treasury to provide Fannie with $8.4 billion of funding by the end of June, Fannie said.
"In the first quarter we continued to serve as a leading source of liquidity to the mortgage market, and we made solid progress in our ongoing efforts to keep people in their homes," Fannie Mae Chief Executive Mike Williams said in the earnings release.
In the first quarter, Fannie paid $1.5 billion in dividends on preferred stock held by the Treasury.
In a filing with the Securities and Exchange Commission on Monday, Fannie said that although the Treasury's funds allow it to remain solvent and avoid receivership, the dividend payments are substantial.
"Given our expectations regarding future losses and draws from Treasury, we do not expect to earn profits in excess of our annual dividend obligation to Treasury for the indefinite future," Fannie said. "As a result of these factors, there is significant uncertainty as to our long-term financial sustainability."