Contact: Pete Bakel Resource Center: 1-800-732-6643

202-752-2034 

Date: May 1, 2020

Fannie Mae Reports Net Income of $461 Million for First Quarter 2020

First Quarter 2020 Results

• Fannie Mae reported net income of $461 million for the first quarter of 2020, compared 

with net income of $4.4 billion for the fourth quarter of 2019. The decrease in net income 

was due primarily to a shift from credit-related income to credit-related expense driven by 

the economic dislocation caused by the COVID-19 outbreak.

“Fannie Mae is committed to 

fulfilling its vital role in 

helping our customers, our 

servicers, and the market as 

a whole manage through 

this period of uncertainty. 

We recognize that more 

work lies ahead to help 

borrowers, renters, and the 

housing market recover. I 

want to give special thanks 

to the people of Fannie Mae, 

who have stepped up to 

their mission with 

characteristic grit and 

humility, and with their rocksolid commitment to provide 

a sound foundation for our 

country’s housing market.”

Hugh R. Frater, 

Chief Executive Officer 

• Fannie Mae is providing substantial liquidity to lenders during the COVID-19 national 

emergency and fulfilling Fannie Mae’s mission to stabilize the housing finance market 

and provide liquidity, support, and access to affordable mortgage financing in all U.S. 

markets in all economic cycles.

• Fannie Mae is providing significant economic relief to borrowers impacted by COVID-19 

through its forbearance program. The company increased its allowance for loan losses to 

reflect the losses it currently expects to incur, including $4.1 billion as a result of the 

economic disruption caused by the COVID-19 outbreak, which are reflected in its $2.7 

billion of credit-related expenses for the quarter. Fannie Mae estimates that 

approximately 7% of loans in its single-family guaranty book of business were in a 

forbearance plan as of April 30, 2020. Fannie Mae’s estimate is based on preliminary 

reporting by servicers. The company expects the number of loans in forbearance plans 

will continue to increase.

• Fannie Mae expects the impact of the COVID-19 national emergency to continue to 

negatively affect its financial results and contribute to lower net income in 2020 than in 

2019. Due to disruptions in the market and economic uncertainty, the company does not 

anticipate engaging in back-end credit-risk transfer transactions in the near term.

Business Highlights

• Fannie Mae’s net worth declined from $14.6 billion as of December 31, 2019 to $13.9 

billion as of March 31, 2020. Although the company had comprehensive income for the 

first quarter of 2020, its net worth declined as a result of a $1.1 billion charge to retained 

earnings due to implementation of the Current Expected Credit Loss (CECL) standard on 

January 1, 2020. Based on its agreement with the U.S. Department of the Treasury, the 

company may retain quarterly earnings until its net worth reaches $25 billion.

• Fannie Mae provided $204.6 billion in liquidity to the mortgage market in the first quarter

of 2020, helping families across the country to own or rent a home through the financing 

of approximately 854,000 home purchases, refinancings, and rental units.

• Fannie Mae continued to be the largest issuer of single-family mortgage-related 

securities in the secondary market during the first quarter of 2020. The company’s 

estimated market share of single-family mortgage-related securities issuances was 38%

for the first quarter of 2020. Fannie Mae’s single-family loan acquisitions consisted of a 

higher share of refinance loans in the first quarter of 2020 compared with the fourth 

quarter of 2019, driven primarily by continued lower interest rates. Fannie Mae has 

financed approximately one in four single-family mortgage loans outstanding in the 

United States.

• Fannie Mae provided $14.1 billion in multifamily financing in the first quarter of 2020, 

which enabled the financing of 159,000 units of multifamily housing. More than 90% of 

the multifamily units the company financed in the first quarter of 2020 were affordable to 

families earning at or below 120% of the area median income, providing support for both 

affordable and workforce housing.

First Quarter 2020 Results 1
WASHINGTON, DC — Fannie Mae (FNMA/OTCQB) reported net income of $461 million and comprehensive 

income of $476 million for the first quarter of 2020, compared with net income of $4.4 billion and comprehensive 

income of $4.3 billion for the fourth quarter of 2019. The decrease in net income in the first quarter of 2020 was due 

primarily to a shift from credit-related income to credit-related expense driven by the economic dislocation caused 

by the COVID-19 outbreak.

Fannie Mae Response to COVID-19

On March 11, 2020, the World Health Organization characterized COVID-19, a new respiratory disease caused by a 

novel coronavirus, as a pandemic, and on March 13, 2020, the COVID-19 outbreak in the United States was 

declared a national emergency. The COVID-19 outbreak in the United States has expanded in recent weeks, and 

has resulted in stay-at-home orders, school closures, and widespread business shutdowns. The COVID-19 

outbreak had a significant impact on Fannie Mae’s business and financial results in the first quarter of 2020, and the 

company expects that it will continue to do so. 

Fannie Mae Response

Fannie Mae is taking a number of actions to help borrowers, renters, lenders, and its employees manage the 

negative impact of the COVID-19 outbreak. 

Borrowers and Renters

• Fannie Mae has implemented new policies to enable the company’s single-family and multifamily loan 

servicers to better assist borrowers and renters impacted by COVID-19, including requiring that the 

company’s servicers comply with CARES Act and Fannie Mae requirements to:

◦ provide forbearance to single-family borrowers reporting they are experiencing a financial hardship 

due to the COVID-19 outbreak for up to 180 days, and at the borrower’s request, extend the 

forbearance period up to a maximum of 12 months total; the company estimates it has provided 

forbearance on more than 1 million single-family loans as of April 30, 2020, based on preliminary 

reporting by servicers;

◦ offer options following forbearance, including a repayment plan, payment deferral, or a loan 

modification that aims to maintain or reduce a borrower’s monthly payment;

◦ suspend foreclosures and foreclosure-related activities for single-family properties through at least 

May 17, 2020, other than for vacant or abandoned properties; 

◦ report as current to credit bureaus homeowners who comply with their forbearance plan and were 

current prior to receiving COVID-19-related forbearance; and

◦ provide forbearance to multifamily borrowers experiencing a financial hardship due to the 

COVID-19 outbreak for up to 3 months on the condition that the borrower suspend all renter 

evictions for nonpayment of rent during the forbearance period, through the 120-day eviction 

moratorium under the CARES Act, which ends on July 25, 2020, or any longer period required by 

state or local law.

• Fannie Mae updated the company’s KnowYourOptions.com website to help keep people in their homes, 

providing information and resources on relief options for borrowers with a loan owned by Fannie Mae and 

for tenants in Fannie Mae multifamily rental properties that are impacted by COVID-19.

Lenders

• Fannie Mae provided $82.9 billion in liquidity to the single-family and multifamily mortgage markets in 

March, including $40.1 billion through the company’s whole-loan conduit to support lenders, including 

community lenders, fulfilling Fannie Mae’s mission to stabilize the housing finance market and provide 

liquidity, support, and access to affordable mortgage financing in all U.S. markets in all economic cycles.

• Fannie Mae limited the duration of single-family principal and interest servicing advances to four months.

First Quarter 2020 Results 2
• Fannie Mae is offering temporary measures to help ensure lenders have the clarity and flexibility to continue 

to lend in a prudent and responsible manner during the COVID-19 national emergency, such as purchasing 

from lenders recently originated single-family mortgages in forbearance that meet eligibility criteria, 

flexibilities related to the lender’s process for obtaining verification of employment and appraisals, and 

allowing online notarization options.

Employees

• Fannie Mae has taken steps to protect the safety and resiliency of its workforce. The company has required 

nearly all of its workforce, except for a small number of employees deemed critical, to work remotely since 

mid-March.

• Fannie Mae offers support services and resources for employees and their families affected by COVID-19, 

including the company’s Employer Assistance Program that provides a helpline number to support loved 

ones who may not be covered otherwise.

• Fannie Mae employees donated more than $90,000 in March (including company matching funds) toward 

COVID-19 related charities.

• Fannie Mae continued to pay most contractors (e.g., cafeteria staff) and accelerated payments to identified 

small businesses.

• To date, the company’s business resiliency plans and technology systems have effectively supported this 

company-wide telework arrangement, allowing Fannie Mae to continue its critical function of supporting 

mortgage market liquidity.

Risks and Uncertainties

The company’s current forecasts and expectations relating to the impact of the COVID-19 outbreak are subject to 

many uncertainties and may change, perhaps substantially. It is difficult to assess or predict the impact of this 

unprecedented event on the company’s business, financial results, or financial condition. Factors that will impact the 

extent to which the COVID-19 outbreak affects Fannie Mae’s business, financial results, and financial condition 

include: the duration, spread and severity of the outbreak; the actions taken to contain the virus or treat its impact, 

including government actions to mitigate the economic impact of the outbreak; the nature and extent of the 

forbearance and modification options the company offers borrowers affected by the outbreak; accounting elections 

and estimates relating to the impact of the COVID-19 outbreak; borrower and renter behavior in response to the 

outbreak and its economic impact; how quickly and to what extent normal economic and operating conditions can 

resume, including whether any future outbreaks interrupt economic recovery; and how quickly and to what extent 

affected borrowers, renters and counterparties can recover from the negative economic impact of the outbreak. See 

“Risk Factors” in the company’s First Quarter 2020 Form 10-Q for a discussion of the risks to the company’s 

business, financial results, and financial condition relating to the COVID-19 outbreak. See "Forward-Looking 

Statements" in the company’s First Quarter 2020 Form 10-Q for a discussion of factors that could cause actual 

conditions, events or results to differ materially from those described in the company’s forecasts, expectations and 

other forward-looking statements in this release.

First Quarter 2020 Results 3
Summary of Financial Results

(Dollars in millions) 1Q20 4Q19 Variance 1Q19 Variance

Net interest income $ 5,347 $ 5,923 $ (576) $ 4,796 $ 551

Fee and other income 308 131 177 134 174

Net revenues 5,655 6,054 (399) 4,930 725

Investment gains (losses), net (158) 923 (1,081) 133 (291)

Fair value gains (losses), net (276) 84 (360) (831) 555

Administrative expenses (749) (786) 37 (744) (5)

Credit-related income (expenses):

Benefit (provision) for credit losses (2,583) 279 (2,862) 650 (3,233)

Foreclosed property expense (80) (151) 71 (140) 60

Total credit-related income (expenses) (2,663) 128 (2,791) 510 (3,173)

Temporary Payroll Tax Cut Continuation Act of 2011 (“TCCA”) fees (637) (626) (11) (593) (44)

Credit enhancement expense (331) (306) (25) (171) (160)

Other expenses, net (263) (241) (22) (207) (56)

Income before federal income taxes 578 5,230 (4,652) 3,027 (2,449)

Provision for federal income taxes (117) (865) 748 (627) 510

Net income $ 461 $ 4,365 $ (3,904) $ 2,400 $ (1,939)

Total comprehensive income $ 476 $ 4,266 $ (3,790) $ 2,361 $ (1,885)

Net revenues, which consist of net interest income and fee and other income, were $5.7 billion for the first quarter

of 2020, compared with $6.1 billion for the fourth quarter of 2019.

Net interest income was $5.3 billion for the first quarter of 2020, compared with $5.9 billion for the fourth quarter of 

2019. The decrease in net interest income for the first quarter of 2020 was primarily due to lower amortization 

income from the company’s guaranty book of business driven by a decrease in mortgage prepayment volume in the 

first quarter of 2020.

Net Interest Income

(Dollars in Billions)

$3.9 $4.3 $4.5 $5.2 $4.7

$0.9 $0.9 $0.8

$0.7 $0.6 $4.8 $5.2 $5.3

$5.9 $5.3

Net interest income from guaranty book of business1 Net interest income from portfolios

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020

(1)

Includes revenues generated by the 10 basis point guaranty fee increase the company implemented pursuant to the TCCA, the incremental 

revenue from which is remitted to Treasury and not retained by Fannie Mae.

First Quarter 2020 Results 4
Net fair value losses were $276 million in the first quarter of 2020, compared with $84 million in gains in the fourth 

quarter of 2019. The shift to net fair value losses in the first quarter of 2020 was driven primarily by net decreases in 

the fair value of the company’s risk management and mortgage commitment derivatives due to decreases in interest 

rates in the first quarter, compared with net gains on risk management derivatives due to increases in interest rates 

in the fourth quarter of 2019.

Fair Value Gains (Losses), Net

(Dollars in Billions)

$(0.8) $(0.8) $(0.7)

$0.1

$(0.3)

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020

Credit-related income (expense) consists of a benefit or provision for credit losses and foreclosed property 

expense. Credit-related expense was $2.7 billion in the first quarter of 2020, compared with credit-related income of 

$128 million in the fourth quarter of 2019. The shift to credit-related expense in the first quarter of 2020 was driven 

primarily by a $4.1 billion increase in the allowance for loan losses as a result of the economic disruption caused by 

the COVID-19 outbreak. Significant management judgment was used to estimate the impact on the company’s 

expected loss reserves. Although Fannie Mae believes its estimates are reasonable, the company may observe 

future volatility as it continues to update its economic outlook for forbearance expectations, model, and other 

assumptions surrounding this unprecedented event over the course of this year.

Credit-Related Income (Expense)

(Dollars in Billions)

$0.5

$1.1

$1.8

$0.1

$(2.7)

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020

First Quarter 2020 Results 5
Net investment losses were $158 million in the first quarter of 2020, compared with gains of $923 million in the 

fourth quarter of 2019. Net investment losses in the first quarter of 2020 were driven primarily by a decrease in the 

fair value of single-family held-for-sale loans due to price decreases. Net investment gains in the fourth quarter of 

2019 were driven primarily by gains from sales of single-family loans.

Investment Gains (Losses), Net

(Dollars in Billions)

$0.1

$0.5

$0.3

$0.9

$(0.2)

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020

Providing Liquidity and Support to the Market

Fannie Mae’s mission is to provide a stable source of liquidity to support housing for low-and moderate-income 

Americans. In the first quarter of 2020, more than 90% of the multifamily units the company financed were 

affordable to families earning at or below 120% of the area median income, providing support for both affordable 

and workforce housing.

Through its single-family and multifamily business segments, Fannie Mae provided $204.6 billion in liquidity to the 

mortgage market in the first quarter of 2020, including $86.1 billion through its whole loan conduit, enabling the 

financing of approximately 854,000 home purchases, refinancings, or rental units. 

Fannie Mae Provided $204.6 Billion in Liquidity in the First Quarter of 2020

Unpaid Principal Balance Units

$68.8B 256K

Single-Family Home Purchases

$121.7B 439K

Single-Family Refinancings

$14.1B 159K

Multifamily Rental Units

First Quarter 2020 Results 6
Business Segments 

Fannie Mae’s two reportable business segments—Single-Family and Multifamily—engage in complementary 

business activities to provide liquidity, access to credit, and affordability in all U.S. housing markets at all times, 

while effectively managing risk. 

Single-Family Business

(Dollars in millions) 1Q20 4Q19 Variance 1Q19 Variance

Net interest income $ 4,541 $ 5,071 $ (530) $ 4,039 $ 502

Fee and other income 152 103 49 106 46

Net revenues 4,693 5,174 (481) 4,145 548

Investment gains (losses), net (152) 880 (1,032) 94 (246)

Fair value gains (losses), net (460) 148 (608) (887) 427

Administrative expenses (629) (666) 37 (631) 2

Credit-related income (expense) (2,250) 124 (2,374) 518 (2,768)

TCCA fees (637) (626) (11) (593) (44)

Credit enhancement expense (312) (284) (28) (167) (145)

Other expenses, net (167) (198) 31 (170) 3

Income before federal income taxes 86 4,552 (4,466) 2,309 (2,223)

Provision for federal income taxes (18) (734) 716 (484) 466

Net income $ 68 $ 3,818 $ (3,750) $ 1,825 $ (1,757)

Serious delinquency rate 0.66 % 0.66 % 0.74 %

Financial Results

• Single-Family net income was $68 million in the first quarter of 2020, compared with $3.8 billion in the fourth 

quarter of 2019. The decrease in net income in the first quarter of 2020 was driven primarily by:

◦ a shift from credit-related income to credit-related expense due to a $3.4 billion increase in the 

allowance for loan losses as a result of the economic disruption caused by the COVID-19 outbreak. 

Significant management judgment was used to estimate the impact on the company’s expected 

loss reserves;

◦ investment losses as a result of the decrease in the fair value of held-for-sale loans; and

◦ fair value losses in the first quarter compared with fair value gains in the fourth quarter, driven by 

decreases in interest rates.

Business Highlights

• The average single-family conventional guaranty book of business increased by $18.3 billion during the first 

quarter of 2020, while the average charged guaranty fee, net of Temporary Payroll Tax Cut Continuation Act 

of 2011 (TCCA) fees, on the single-family conventional guaranty book increased slightly in the first quarter

from 43.6 basis points as of December 31, 2019 to 43.8 basis points as of March 31, 2020.

• Fannie Mae’s average charged guaranty fee on newly acquired conventional single-family loans, net of 

TCCA fees, increased 2.5 basis points to 49.4 basis points in the first quarter of 2020 from 46.9 basis points 

in the fourth quarter of 2019, driven primarily by a decrease in the estimated weighted average life of 

acquisitions used to annualize upfront fees.

• The single-family serious delinquency rate remained flat at 0.66% as of March 31, 2020 and December 31, 

2019, respectively. Single-family seriously delinquent loans are loans that are 90 days or more past due or 

in the foreclosure process. As a result, the single-family serious delinquency rate as of March 31, 2020 does 

not reflect the impact of the COVID-19 outbreak.

First Quarter 2020 Results 7
Multifamily Business

(Dollars in millions) 1Q20 4Q19 Variance 1Q19 Variance

Net interest income $ 806 $ 851 $ (45) $ 757 $ 49

Fee and other income 156 28 128 28 128

Net revenues 962 879 83 785 177

Fair value gains (losses), net 184 (64) 248 56 128

Administrative expenses (120) (120) — (113) (7)

Credit-related income (expense) (413) 4 (417) (8) (405)

Credit enhancement expense (19) (22) 3 (4) (15)

Other income (expenses), net (102) 1 (103) 2 (104)

Income before federal income taxes 492 678 (186) 718 (226)

Provision for federal income taxes (99) (131) 32 (143) 44

Net income $ 393 $ 547 $ (154) $ 575 $ (182)

Serious delinquency rate 0.05 % 0.04 % 0.07 %

Financial Results

• Multifamily net income was $393 million in the first quarter of 2020, compared with $547 million in the fourth 

quarter of 2019. The decrease in net income in the first quarter of 2020 was attributable primarily to a shift 

to credit-related expense in the first quarter of 2020 due to a $636 million increase in the allowance for loan 

losses as a result of the economic disruption caused by the COVID-19 outbreak.

Business Highlights

• The average multifamily guaranty book of business increased by nearly $8 billion during the first quarter of 

2020 to $342 billion, while the average charged guaranty fee on the multifamily book remained relatively flat 

at 72 basis points compared with the fourth quarter of 2019.

• New multifamily business volume was approximately $14 billion in the first quarter of 2020. Approximately 

$68 billion of new business capacity remains under the $100 billion multifamily business volume cap 

structure for the five-quarter period ending December 31, 2020.

• The multifamily serious delinquency rate was 0.05% as of March 31, 2020, an increase from 0.04% as of 

December 31, 2019. Multifamily seriously delinquent loans are loans that are 60 days or more past due. As 

a result, the multifamily serious delinquency rate as of March 31, 2020 does not reflect the impact of the 

COVID-19 outbreak.

Treasury Housing Reform Plan and Letter Agreement with Treasury

On September 5, 2019, Treasury released a plan recommending administrative and legislative reforms to the 

housing finance system. The Treasury Housing Reform Plan recommends ending Fannie Mae’s conservatorship, 

considering additional restrictions and requirements on Fannie Mae’s business, and many other matters.

For more information on Treasury’s Housing Reform Plan and risks associated with the plan, as well as the letter 

agreement with Treasury, see “Business—Conservatorship, Treasury Agreements and Housing Finance Reform” 

and “Risk Factors” in the company’s annual report on Form 10-K for the year ended December 31, 2019 (2019 

Form 10-K) and “Legislation and Regulation” and “Risk Factors” in the company’s quarterly report on Form 10-Q for 

the quarter ended March 31, 2020 (First Quarter 2020 Form 10-Q). 

Net Worth, Treasury Funding, and Senior Preferred Stock Dividends

Treasury has made a commitment under a senior preferred stock purchase agreement to provide funding to Fannie 

Mae under certain circumstances if the company has a net worth deficit. Pursuant to the senior preferred stock 

purchase agreement, the company issued shares of senior preferred stock to Treasury in 2008.

First Quarter 2020 Results 8
Under the terms of the senior preferred stock, Fannie Mae will not owe senior preferred stock dividends to Treasury 

until it has accumulated over $25 billion in net worth as of the end of the quarter. Accordingly, no dividends were 

payable to Treasury for the first quarter of 2020, and none are payable for the second quarter of 2020.

The charts below show information about Fannie Mae’s net worth, the remaining amount of Treasury’s funding 

commitment to Fannie Mae, senior preferred stock dividends the company has paid Treasury, and funds the 

company has drawn from Treasury pursuant to its funding commitment.

Net Worth and Treasury

Funding Commitment

(Dollars in billions)

$13.9

$113.9

Net Worth

Remaining Treasury funding commitment

As of March 31, 2020

Dividend Payments and Draws

(Dollars in billions)

$181.4

$119.8

Cumulative dividend payments to Treasury1

Cumulative draws from Treasury2

As of March 31, 2020

(1)

Aggregate amount of dividends the company has paid to Treasury on the senior preferred stock from 2008 through March 31, 2020. Under 

the terms of the senior preferred stock purchase agreement, dividend payments the company makes to Treasury do not offset its draws of 

funds from Treasury.

(2)

Aggregate amount of funds the company has drawn from Treasury pursuant to the senior preferred stock purchase agreement from 2008 

through March 31, 2020.

The aggregate liquidation preference of Fannie Mae’s senior preferred stock increased from $131.2 billion as of 

December 31, 2019 to $135.4 billion as of March 31, 2020 due to the increase in the company’s net worth during 

the fourth quarter of 2019. Because the company’s net worth did not increase during the first quarter of 2020, the 

aggregate liquidation preference of its senior preferred stock will remain at $135.4 billion as of June 30, 2020.

If the company were to draw additional funds from Treasury under the senior preferred stock purchase agreement 

with respect to a future period, the amount of remaining funding under the agreement would be reduced by the 

amount of the company’s draw, and the aggregate liquidation preference of the senior preferred stock would 

increase by the amount of that draw.

For a description of the terms of the senior preferred stock purchase agreement and the senior preferred stock, see 

“Business—Conservatorship, Treasury Agreements and Housing Finance Reform” in the company’s 2019 Form 10-

K.

-

Fannie Mae’s financial statements for the first quarter of 2020 are available in the accompanying Annex; however, 

investors and interested parties should read the company’s First Quarter 2020 Form 10-Q, which was filed today 

with the Securities and Exchange Commission and is available on Fannie Mae’s website, www.fanniemae.com. The 

company provides further discussion of its financial results and condition, credit performance, and other matters in 

its First Quarter 2020 Form 10-Q. Additional information about the company’s financial and credit performance is 

contained in Fannie Mae’s Q1 2020 Financial Supplement at www.fanniemae.com.

First Quarter 2020 Results 9
# # #

In this release, the company has presented a number of estimates, forecasts, expectations, and other forward-looking statements, including 

statements regarding: the company’s future business and financial results, the future impact of the COVID-19 outbreak on the company’s 

business and financial results and credit performance, future dividend payments to Treasury, and the future liquidation preference of the senior 

preferred stock. These estimates, forecasts, expectations, and statements are forward-looking statements based on the company’s current 

assumptions regarding numerous factors. Actual results, and future projections, could be materially different from what is set forth in the forwardlooking statements as a result of: the uncertainty of the company’s future and its exit from conservatorship; the duration, spread and severity of 

the COVID-19 outbreak; the actions taken to contain the virus or treat its impact, including government actions to mitigate the economic impact of 

the outbreak; the nature and extent of the forbearance and modification options the company offers borrowers affected by the outbreak; 

accounting elections and estimates relating to the impact of the COVID-19 outbreak; borrower and renter behavior in response to the outbreak 

and its economic impact; how quickly and to what extent normal economic and operating conditions can resume, including whether any future 

outbreaks interrupt economic recovery; and how quickly and to what extent affected borrowers, renters and counterparties can recover from the 

negative impact of the outbreak; the market and regulatory changes the company anticipates and the company’s readiness for them, including 

changes relating to an eventual exit from conservatorship, the competitive landscape, and the need to attract private investment; future legislative 

and regulatory requirements or changes affecting the company, such as the enactment of housing finance reform legislation (including all or any 

portion of the plan released by the U.S. Department of the Treasury (Treasury) in September 2019 for housing finance reform), including 

changes that limit the company’s business activities or its footprint; actions by FHFA, Treasury, the U.S. Department of Housing and Urban 

Development, the Consumer Financial Protection Bureau or other regulators, Congress, or state or local governments that affect the company’s 

business, including new capital requirements that become applicable to the company or changes in the ability-to-repay rule to replace the 

qualified mortgage patch for government-sponsored enterprise-eligible loans; changes in the structure and regulation of the financial services 

industry; the timing and level of, as well as regional variation in, home price changes; changes in interest rates and credit spreads; developments 

that may be difficult to predict, including: market conditions that result in changes in the company’s net amortization income from its guaranty 

book of business, fluctuations in the estimated fair value of the company’s derivatives and other financial instruments that it marks to market 

through its earnings; and developments that affect its loss reserves, such as changes in interest rates, home prices or accounting standards, or 

events such as natural disasters or the emergence of widespread health emergencies or pandemics; uncertainties relating to the discontinuance 

of LIBOR, or other market changes that could impact the company’s loans or MBS; credit availability; disruptions or instability in the housing and 

credit markets; the size and the company’s share of the U.S. mortgage market and the factors that affect them, including population growth and 

household formation; growth, deterioration and the overall health and stability of the U.S. economy, including U.S. GDP, unemployment rates, 

personal income and other indicators thereof; changes in the fiscal and monetary policies of the Federal Reserve; the company’s and its 

competitors’ future guaranty fee pricing and the impact of that pricing on the company’s competitive environment and guaranty fee revenues; the 

volume of mortgage originations; the size, composition, quality and performance of the company’s guaranty book of business and retained 

mortgage portfolio; the competitive environment in which the company operates, including the impact of legislative, regulatory or other 

developments on levels of competition in the company’s industry and other factors affecting its market share; how long loans in the company’s 

guaranty book of business remain outstanding; challenges the company faces in retaining and hiring qualified executives and other employees; 

the effectiveness of the company’s business resiliency plans and systems; changes in the demand for Fannie Mae MBS, in general or from one 

or more major groups of investors; the company’s conservatorship, including any changes to or termination (by receivership or otherwise) of the 

conservatorship and its effect on the company’s business; the investment by Treasury, including potential changes to the terms of the senior 

preferred stock purchase agreement or senior preferred stock, and its effect on the company’s business, including restrictions imposed on the 

company by the terms of the senior preferred stock purchase agreement, the senior preferred stock, and Treasury’s warrant, as well as the 

possibility that these or other restrictions on the company’s business and activities may be applied to the company through other mechanisms 

even if it ceases to be subject to these agreements and instruments; adverse effects from activities the company undertakes to support the 

mortgage market and help borrowers, renters, lenders and servicers; actions it may be required to take by FHFA, in its role as the company’s 

conservator or as its regulator, such as actions in response to the COVID-19 outbreak, changes in the type of business the company does, or 

actions relating to UMBS or the company’s resecuritization of Freddie Mac-issued securities; limitations on the company’s business imposed by 

FHFA, in its role as the company’s conservator or as its regulator; the company’s future objectives and activities in support of those objectives, 

including actions Fannie Mae may take to reach additional underserved creditworthy borrowers; the possibility that future changes in leadership 

at FHFA or the Administration may result in changes in FHFA’s or Treasury’s willingness to pursue the administrative reform recommendations in 

Treasury’s housing finance reform plan; the company’s reliance on Common Securitization Solutions, LLC (CSS) and the common securitization 

platform for a majority of its single-family securitization activities, the company’s reduced influence over CSS as a result of recent changes to the 

CSS limited liability company agreement, and any additional changes FHFA may require in the company’s relationship with or in the company’s 

support of CSS; a decrease in the company’s credit ratings; limitations on the company’s ability to access the debt capital markets; continued 

limitations on the company’s ability to enter into credit risk transfer transactions; significant changes in forbearance, modification and foreclosure 

activity; the volume and pace of future nonperforming and reperforming loan sales and their impact on the company’s results and serious 

delinquency rates; changes in borrower behavior; actions Fannie Mae may take to mitigate losses, and the effectiveness of the company’s loss 

mitigation strategies, management of the company’s REO inventory and pursuit of contractual remedies; defaults by one or more institutional 

counterparties; resolution or settlement agreements Fannie Mae may enter into with the company’s counterparties; the company’s need to rely 

on third parties to fully achieve some of the company’s corporate objectives; the company’s reliance on mortgage servicers; changes in GAAP, 

guidance by the Financial Accounting Standards Board and changes to the company’s accounting policies; changes in the fair value of the 

company’s assets and liabilities; the stability and adequacy of the systems and infrastructure that impact the company’s operations, including the 

company’s and those of CSS, the company’s other counterparties and other third parties; the impact of increasing interdependence between the 

single-family mortgage securitization programs of Fannie Mae and Freddie Mac in connection with UMBS; operational control weaknesses; the 

company’s reliance on models and future updates the company makes to its models, including the assumptions used by these models; domestic 

and global political risks and uncertainties; natural disasters, environmental disasters, terrorist attacks, widespread health emergencies or 

pandemics, or other major disruptive events; cyber attacks or other information security breaches or threats; and the other factors described in 

“Risk Factors” in the company’s First Quarter 2020 Form 10-Q and its 2019 Form 10-K. 

Fannie Mae provides website addresses in its news releases solely for readers’ information. Other content or information appearing on these 

websites is not part of this release. 

Fannie Mae helps make the 30-year fixed-rate mortgage and affordable rental housing possible for millions of Americans. We partner with 

lenders to create housing opportunities for families across the country. We are driving positive changes in housing finance to make the home 

buying process easier, while reducing costs and risk. To learn more, visit fanniemae.com and follow us on twitter.com/fanniemae.

First Quarter 2020 Results 10
ANNEX

FANNIE MAE

(In conservatorship)

Condensed Consolidated Balance Sheets — (Unaudited)

(Dollars in millions)

As of

March 31, 

2020

December 31, 

2019

ASSETS

Cash and cash equivalents $ 80,463 $ 21,184

Restricted cash (includes $41,331 and $33,294, respectively, related to consolidated trusts) 48,245 40,223

Federal funds sold and securities purchased under agreements to resell or similar arrangements 7,775 13,578

Investments in securities:

Trading, at fair value (includes $5,562 and $3,037, respectively, pledged as collateral) 52,941 48,123

Available-for-sale, at fair value (with an amortized cost of $2,147, net of allowance for credit losses of

 $3 as of March 31, 2020) 2,289 2,404

Total investments in securities 55,230 50,527

Mortgage loans:

Loans held for sale, at lower of cost or fair value 8,103 6,773

Loans held for investment, at amortized cost:

Of Fannie Mae 98,585 94,911

Of consolidated trusts 3,269,331 3,241,494

Total loans held for investment (includes $7,701 and $7,825, respectively, at fair value) 3,367,916 3,336,405

Allowance for loan losses (13,209) (9,016)

Total loans held for investment, net of allowance 3,354,707 3,327,389

Total mortgage loans 3,362,810 3,334,162

Advances to lenders 8,971 6,453

Deferred tax assets, net 12,831 11,910

Accrued interest receivable, net (includes $8,417 and $8,172, respectively, related to consolidated trusts) 8,808 8,604

Acquired property, net 2,224 2,366

Other assets 13,999 14,312

Total assets $ 3,601,356 $ 3,503,319

LIABILITIES AND EQUITY

Liabilities:

Accrued interest payable (includes $9,386 and $9,361, respectively, related to consolidated trusts) $ 10,246 $ 10,228

Debt:

Of Fannie Mae (includes $4,752 and $5,687, respectively, at fair value) 228,458 182,247

Of consolidated trusts (includes $22,855 and $21,880, respectively, at fair value) 3,334,098 3,285,139

Other liabilities (includes $355 and $376, respectively, related to consolidated trusts) 14,609 11,097

Total liabilities 3,587,411 3,488,711

Commitments and contingencies (Note 13) — —

Fannie Mae stockholders’ equity:

Senior preferred stock (liquidation preference of $135,444 and $131,178, respectively) 120,836 120,836

Preferred stock, 700,000,000 shares are authorized—555,374,922 shares issued and outstanding 19,130 19,130

Common stock, no par value, no maximum authorization—1,308,762,703 shares issued and 

 1,158,087,567 shares outstanding 687 687

Accumulated deficit (119,454) (118,776)

Accumulated other comprehensive income 146 131

Treasury stock, at cost, 150,675,136 shares (7,400) (7,400)

Total stockholders’ equity (See Note 1: Senior Preferred Stock Purchase Agreement and Senior 

Preferred Stock for information on the related dividend obligation and liquidation preference) 13,945 14,608

Total liabilities and equity $ 3,601,356 $ 3,503,319

See Notes to Condensed Consolidated Financial Statements in the First Quarter 2020 Form 10-Q

First Quarter 2020 Results 11
FANNIE MAE

(In conservatorship)

Condensed Consolidated Statements of Operations and Comprehensive Income — (Unaudited)

(Dollars in millions, except per share amounts)

For the Three Months Ended 

March 31,

2020 2019

Interest income:

Trading securities $ 316 $ 427

Available-for-sale securities 31 53

Mortgage loans 28,938 29,862

Federal funds sold and securities purchased under agreements to resell or similar arrangements 107 263

Other 34 32

Total interest income 29,426 30,637

Interest expense:

Short-term debt (102) (125)

 Long-term debt (23,977) (25,716)

Total interest expense (24,079) (25,841)

Net interest income 5,347 4,796

Benefit (provision) for credit losses (2,583) 650

Net interest income after benefit (provision) for credit losses 2,764 5,446

Investment gains (losses), net (158) 133

Fair value losses, net (276) (831)

Fee and other income 308 134

Non-interest loss (126) (564)

Administrative expenses:

Salaries and employee benefits (393) (386)

Professional services (212) (225)

Other administrative expenses (144) (133)

Total administrative expenses (749) (744)

Foreclosed property expense (80) (140)

Temporary Payroll Tax Cut Continuation Act of 2011 (“TCCA”) fees (637) (593)

Credit enhancement expense (331) (171)

Other expenses, net (263) (207)

Total expenses (2,060) (1,855)

Income before federal income taxes 578 3,027

Provision for federal income taxes (117) (627)

Net income 461 2,400

Other comprehensive income (loss):

Changes in unrealized gains (losses) on available-for-sale securities, net of reclassification adjustments 

and taxes 18 (36)

Other, net of taxes (3) (3)

Total other comprehensive income (loss) 15 (39)

Total comprehensive income $ 476 $ 2,361

Net income $ 461 $ 2,400

Dividends distributed or amounts attributable to senior preferred stock (476) (2,361)

Net income (loss) attributable to common stockholders $ (15) $ 39

Earnings per share:

Basic $ 0.00 $ 0.01

Diluted 0.00 0.01

Weighted-average common shares outstanding:

Basic 5,867 5,762

Diluted 5,867 5,893

See Notes to Condensed Consolidated Financial Statements in the First Quarter 2020 Form 10-Q

First Quarter 2020 Results 12
FANNIE MAE

(In conservatorship)

Condensed Consolidated Statements of Cash Flows — (Unaudited)

(Dollars in millions)

For the Three Months 

Ended March 31,

2020 2019

Net cash provided by operating activities $ 2,174 $ 1,816

Cash flows provided by investing activities:

Proceeds from maturities and paydowns of trading securities held for investment 13 15

Proceeds from sales of trading securities held for investment — 49

Proceeds from maturities and paydowns of available-for-sale securities 96 113

Proceeds from sales of available-for-sale securities 50 131

Purchases of loans held for investment (86,307) (33,631)

Proceeds from repayments of loans acquired as held for investment of Fannie Mae 2,308 2,786

Proceeds from sales of loans acquired as held for investment of Fannie Mae — 26

Proceeds from repayments and sales of loans acquired as held for investment of consolidated trusts 169,656 88,419

Advances to lenders (45,248) (22,991)

Proceeds from disposition of acquired property and preforeclosure sales 1,832 1,965

Net change in federal funds sold and securities purchased under agreements to resell or similar arrangements 5,803 10,688

Other, net (539) (124)

Net cash provided by investing activities 47,664 47,446

Cash flows used in financing activities:

Proceeds from issuance of debt of Fannie Mae 254,559 173,122

Payments to redeem debt of Fannie Mae (207,818) (184,222)

Proceeds from issuance of debt of consolidated trusts 135,918 64,821

Payments to redeem debt of consolidated trusts (164,726) (96,925)

Payments of cash dividends on senior preferred stock to Treasury — (3,240)

Other, net (470) —

Net cash provided by (used in) financing activities 17,463 (46,444)

Net increase in cash, cash equivalents and restricted cash 67,301 2,818

Cash, cash equivalents and restricted cash at beginning of period 61,407 49,423

Cash, cash equivalents and restricted cash at end of period $128,708 $ 52,241

Cash paid during the period for:

Interest $ 28,867 $ 28,650

Income taxes — —

See Notes to Condensed Consolidated Financial Statements in the First Quarter 2020 Form 10-Q

First Quarter 2020 Results 13
FANNIE MAE

(In conservatorship)

Condensed Consolidated Statements of Changes in Equity (Deficit) — (Unaudited)

(Dollars and shares in millions)

Fannie Mae Stockholders’ Equity (Deficit)

Shares Outstanding

Senior

Preferred 

Stock

Preferred

Stock

Common

Stock

Accumulated

Deficit

Accumulated 

Other

Comprehensive

Income

Treasury

Stock

Total

Equity

Senior

Preferred Preferred Common

Balance as of December 31, 2019 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (118,776) $ 131 $ (7,400) $14,608

Transition impact, net of tax, from the 

adoption of the current expected credit 

loss standard — — — — — — (1,139) — — (1,139)

Balance as of January 1, 2020, 

adjusted 1 556 1,158 120,836 19,130 687 (119,915) 131 (7,400) 13,469

Senior preferred stock dividends paid — — — — — — — — — —

Comprehensive income:

Net income — — — — — — 461 — — 461

Other comprehensive income, net of tax 

effect:

Changes in net unrealized gains on 

available-for-sale securities (net of 

taxes of $5) — — — — — — — 18 — 18

Reclassification adjustment for 

gains included in net income (net of 

taxes of $—) — — — — — — — — — —

Other (net of taxes of $1) — — — — — — — (3) — (3)

Total comprehensive income 476

Balance as of March 31, 2020 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (119,454) $ 146 $ (7,400) $13,945

Fannie Mae Stockholders’ Equity (Deficit)

Shares Outstanding

Senior

Preferred 

Stock

Preferred

Stock

Common

Stock

Accumulated

Deficit

Accumulated 

Other

Comprehensive

Income

Treasury

Stock

Total

Equity

Senior

Preferred Preferred Common

Balance as of December 31, 2018 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (127,335) $ 322 $ (7,400) $ 6,240

Senior preferred stock dividends paid — — — — — — (3,240) — — (3,240)

Comprehensive income:

Net income — — — — — — 2,400 — — 2,400

Other comprehensive income, net of tax 

effect:

Changes in net unrealized gains on 

available-for-sale securities (net of 

taxes of $2) — — — — — — — 8 — 8

Reclassification adjustment for 

gains included in net income (net of 

taxes of $12) — — — — — — — (44) — (44)

Other (net of taxes of $1) — — — — — — — (3) — (3)

Total comprehensive income 2,361

Balance as of March 31, 2019 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (128,175) $ 283 $ (7,400) $ 5,361

See Notes to Condensed Consolidated Financial Statements in the First Quarter 2020 Form 10-Q

First Quarter 2020 Results 14