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

202-752-2034

Date: July 30, 2020

Fannie Mae Reports Net Income of $2.5 Billion for Second Quarter 2020

Second Quarter 2020 Results

“During this time of 

economic uncertainty, 

Fannie Mae is a force for 

stability, affordability, and 

liquidity in the housing 

markets. In the second 

quarter, we helped hundreds 

of thousands of 

homeowners and renters get 

the guidance and support 

they needed to stay in their 

homes, while we delivered 

on record refinancing 

demand. Fannie Mae will 

continue to work with 

partners across the industry 

to fulfill our mission and our 

leadership role in housing 

finance.”

Hugh R. Frater, 

Chief Executive Officer 

• Fannie Mae reported net income of $2.5 billion for the second quarter of 2020, compared

with net income of $461 million for the first quarter of 2020. The increase in net income

was due primarily to a decline in credit-related expense in the second quarter of 2020

compared with the first quarter of 2020. The company’s credit-related expense in the first

quarter of 2020 was driven by a substantial increase in its allowance for loan losses due

to the economic dislocation caused by the COVID-19 pandemic. The allowance for loan

losses remained relatively flat in the second quarter of 2020.

• Fannie Mae continues to provide economic relief to borrowers impacted by COVID-19

through its forbearance program. As of June 30, 2020, 5.7% of Fannie Mae’s singlefamily guaranty book of business based on loan count and 1.2% of the company’s

multifamily guaranty book of business based on unpaid principal balance were in

forbearance, the vast majority of which were related to COVID-19.

• Fannie Mae’s net worth increased from $13.9 billion as of March 31, 2020 to $16.5 billion

as of June 30, 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 expects the impact of the COVID-19 pandemic to continue to negatively

affect its financial results, contributing to lower net income in 2020 than in 2019.

Business Highlights

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

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 provided $542 billion in single-family liquidity to the mortgage market in the

first half of 2020, including $288 billion through its whole loan conduit, enabling the

financing of approximately 593,000 home purchases and 1,352,000 refinancings. Fannie

Mae has financed approximately one in four single-family mortgage loans outstanding in

the United States.

• Fannie Mae provided $34 billion in multifamily financing in the first half of 2020, which

enabled the financing of 373,000 units of multifamily housing. More than 90% of the

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

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

affordable and workforce housing.

• Fannie Mae did not enter into credit risk transfer transactions in the second quarter of

2020 due to continuing adverse market conditions as a result of the COVID-19

pandemic. Although market conditions have improved, Fannie Mae currently does not

have plans to engage in additional credit risk transfer transactions as the company and

its financial advisors evaluate the Federal Housing Finance Agency’s (FHFA’s) recently

re-proposed capital rule, which would reduce the amount of capital relief the company

obtains from these transactions. Fannie Mae will continue to review its plans, which may

be affected by the company’s evaluation of the proposed capital rule and changes in the

rule as it is finalized, its progress in meeting FHFA’s 2020 conservatorship scorecard, the

strength of future market conditions, and its review of the company’s overall business

and capital plan to enable it to exit conservatorship.

Second Quarter 2020 Results 1
WASHINGTON, DC — Fannie Mae (FNMA/OTCQB) reported net income of $2.5 billion and comprehensive income 

of $2.5 billion for the second quarter of 2020, compared with net income of $461 million and comprehensive income 

of $476 million for the first quarter of 2020. The increase in net income was due primarily to a decline in creditrelated expense in the second quarter of 2020 compared with the first quarter of 2020. The company’s credit-related 

expense in the first quarter of 2020 was driven by a substantial increase in its allowance for loan losses due to the 

economic dislocation caused by the COVID-19 pandemic. The allowance for loan losses remained relatively flat in 

the second quarter of 2020.

Fannie Mae Response to COVID-19

In March 2020, the COVID-19 outbreak in the United States was declared a national emergency. The COVID-19 

pandemic resulted in stay-at-home orders, school closures, and widespread business shutdowns across the 

country. Although business activity has begun to resume to varying degrees, the speed and nature of the 

resumption of economic activity remains highly uncertain. The COVID-19 pandemic continues to have a significant 

impact on Fannie Mae’s business and financial results. 

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 pandemic. 

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 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; approximately 972,000 single-family loans 

in the company’s book of business were in forbearance as of June 30, 2020;

◦ 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 

August 31, 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 that no late fees are charged

for homeowners in a forbearance plan; and

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

COVID-19 outbreak for up to 6 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 ended on July 25, 2020, or any longer period required by 

state or local law.

• Fannie Mae created the #HeretoHelp educational effort and updated the company’s 

KnowYourOptions.com website to help keep people in their homes, providing information and resources 

on relief options for borrowers and renters impacted by COVID-19. The website includes the Renters 

Resource Finder, an online tool that allows renters to enter their building address to determine whether they 

live in a Fannie Mae-financed property and learn what resources they can access for help. Resources 

include access to Fannie Mae’s Disaster Response Network, which offers free assistance to renters in 

Fannie Mae-financed rental properties, such as HUD-approved housing counselors that can help create a 

personalized action plan, offer financial coaching and budgeting, and provide other support. 

Second Quarter 2020 Results 2
Lenders

• Fannie Mae provided more than $453 billion in liquidity to the single-family and multifamily mortgage 

markets from the beginning of March 2020 through June 2020, including more than $241 billion through the 

company’s whole loan conduit to support small and mid-sized 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 servicers’ obligations to advance principal and interest 

payments on delinquent loans to four months.

• Fannie Mae continues to build its digital mortgage capabilities, enabling the company to adapt quickly to 

lenders’ needs. In addition, the company is offering measures to help ensure lenders have the clarity and 

flexibility to continue to lend in a prudent and responsible manner during the COVID-19 pandemic. These 

measures include: offering additional methods of obtaining verbal verification of borrower employment; 

using the company’s digital tools to offer flexibilities related to the lender’s process for obtaining inspections 

and appraisals; and allowing remote 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 to work remotely since mid-March and continues to assess when it will be safe for 

employees to return to the office.

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

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

mortgage market liquidity.

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

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

ones who may not be covered otherwise.

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

small businesses.

Risks and Uncertainties

Fannie Mae’s current forecasts and expectations relating to the impact of the COVID-19 pandemic 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 pandemic affects the company’s business, financial results, and financial condition 

include: the duration, spread, and severity of COVID-19 outbreaks; the actions taken to contain the virus or treat its 

impact, including government actions to mitigate the economic impact of the pandemic; the extent to which 

consumers, workers, and families feel safe resuming business activities and school; the nature and extent of the 

forbearance, modification, and other loss mitigation options borrowers affected by the pandemic obtain from Fannie 

Mae; accounting elections and estimates relating to the impact of the COVID-19 pandemic; borrower and renter 

behavior in response to the pandemic 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 pandemic. See “Risk Factors” in the company’s Second 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 pandemic. 

See “Forward-Looking Statements” in the company’s Second 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.

Second Quarter 2020 Results 3
Summary of Financial Results

(Dollars in millions) 2Q20 1Q20 Variance 2Q19 Variance

Net interest income $ 5,777 $ 5,347 $ 430 $ 5,227 $ 550 

Fee and other income 90 120 (30) 113 (23) 

Net revenues 5,867 5,467 400 5,340 527 

Investment gains (losses), net 149 (158) 307 461 (312) 

Fair value losses, net (1,018) (276) (742) (754) (264) 

Administrative expenses (754) (749) (5) (744) (10) 

Credit-related income (expenses):

Benefit (provision) for credit losses (12) (2,583) 2,571 1,225 (1,237) 

Foreclosed property expense (10) (80) 70 (128) 118 

Total credit-related income (expenses) (22) (2,663) 2,641 1,097 (1,119) 

Temporary Payroll Tax Cut Continuation Act of 2011 (“TCCA”) fees (660) (637) (23) (600) (60) 

Credit enhancement expense (360) (376) 16 (276) (84) 

Change in expected credit enhancement recoveries 273 188 85 — 273 

Other expenses, net (261) (218) (43) (203) (58) 

Income before federal income taxes 3,214 578 2,636 4,321 (1,107) 

Provision for federal income taxes (669) (117) (552) (889) 220 

Net income $ 2,545 $ 461 $ 2,084 $ 3,432 $ (887) 

Total comprehensive income $ 2,532 $ 476 $ 2,056 $ 3,365 $ (833) 

Net revenues, which consist of net interest income and fee and other income, were $5.9 billion for the second 

quarter of 2020, compared with $5.5 billion for the first quarter of 2020.

Net interest income was $5.8 billion for the second quarter of 2020, compared with $5.3 billion for the first quarter of 

2020. The increase in net interest income was due primarily to higher amortization income driven by an increase in 

mortgage prepayment activity as a result of the historically low interest rate environment in the second quarter of 

2020. The company’s net interest income for the second quarter of 2020 was impacted by an update to the 

application of its accounting policy for nonaccrual loans that allowed the company to continue accruing interest 

income on delinquent loans that were current as of March 1, 2020 and have been negatively impacted by the 

COVID-19 pandemic. As a result of this update, the company recognized $1.5 billion in net interest income related 

to these loans in the second quarter. See “Note 1, Summary of Significant Accounting Policies—New Accounting 

Guidance” in the company’s Second Quarter 2020 Form 10-Q for more information on the company’s policy for 

nonaccrual loans.

Net Interest Income

(Dollars in Billions)

$4.3 $4.5 $5.2 $4.7 $5.3

$0.9 $0.8

$0.7 $0.6 $0.5 $5.2 $5.3

$5.9

$5.3 $5.8

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

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020

Second Quarter 2020 Results 4
(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.

Net fair value losses were $1.0 billion in the second quarter of 2020, compared with $276 million in the first quarter

of 2020. The increase in net fair value losses in the second quarter of 2020 was driven primarily by a shift from 

gains to losses on Connecticut Avenue Securities® (CAS) debt reported at fair value resulting from tightening 

spreads between CAS debt yields and LIBOR during the second quarter of 2020.

Fair Value Gains (Losses), Net

(Dollars in Billions)

$(0.8) $(0.7)

$0.1

$(0.3)

$(1.0)

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020

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

expense. Credit-related expense decreased to $22 million in the second quarter of 2020 from $2.7 billion in the first 

quarter of 2020. Credit-related expense in the first quarter was driven by a substantial increase in the allowance for 

loan losses due to the economic dislocation caused by the COVID-19 pandemic. The allowance for loan losses 

remained relatively flat in the second quarter of 2020.

Credit-Related Income (Expense)

(Dollars in Billions)

$1.1

$1.8

$0.1

$(2.7)

$(0.02)

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020

Second Quarter 2020 Results 5
Net investment gains were $149 million in the second quarter of 2020, compared with net investment losses of 

$158 million in the first quarter of 2020. The shift to net investment gains in the second quarter of 2020 was due 

primarily to an increase in the fair value of single-family held-for-sale loans in the second quarter of 2020. 

Investment Gains (Losses), Net

(Dollars in Billions)

$0.5

$0.3

$0.9

$(0.2)

$0.1

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 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 

borrowers and renters. In the first half 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 more than $575 billion in 

liquidity to the mortgage market in the first half of 2020, including $288 billion through its whole loan conduit, 

enabling the financing of approximately 2.3 million home purchases, refinancings, or rental units. 

Fannie Mae Provided More Than $575 Billion in Liquidity in the First Half of 2020 

Unpaid Principal Balance Units

$161B 593K

Single-Family Home Purchases

$381B 1.3M

Single-Family Refinancings

$34B 373K

Multifamily Rental Units

Second 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 Financial Results

(Dollars in millions) 2Q20 1Q20 Variance 2Q19 Variance

Net interest income $ 4,939 $ 4,541 $ 398 $ 4,419 $ 520 

Fee and other income 71 94 (23) 88 (17) 

Net revenues 5,010 4,635 375 4,507 503 

Investment gains (losses), net 96 (152) 248 417 (321) 

Fair value gains (losses), net (1,030) (460) (570) (758) (272) 

Administrative expenses (625) (629) 4 (634) 9 

Credit-related income (expense) 216 (2,250) 2,466 1,126 (910) 

TCCA fees (660) (637) (23) (600) (60) 

Credit enhancement expense (307) (316) 9 (229) (78) 

Change in expected credit enhancement recoveries 208 58 150 — 208 

Other expenses, net (252) (163) (89) (189) (63) 

Income before federal income taxes 2,656 86 2,570 3,640 (984) 

Provision for federal income taxes (556) (18) (538) (769) 213 

Net income $ 2,100 $ 68 $ 2,032 $ 2,871 $ (771) 

Serious delinquency rate 2.65 % 0.66 % 0.70 %

Business Highlights

• The average single-family conventional guaranty book of business increased by over $50 billion during the 

second quarter of 2020. 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 from 43.8 basis points 

as of March 31, 2020 to 44.2 basis points as of June 30, 2020.

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

TCCA fees, decreased 2.7 basis points to 46.7 basis points in the second quarter of 2020 from 49.4 basis 

points in the first quarter of 2020, driven primarily by the stronger credit profile of the single-family loans 

acquired in the second quarter of 2020 compared with the first quarter of 2020.

• Single-family acquisition volume was over $350 billion in the second quarter of 2020, an increase of 84% 

compared with the first quarter of 2020. The increase was driven by a $137 billion increase in refinance 

volume due to the historically low interest rate environment, resulting in the highest level of refinance 

volumes in any quarter since the third quarter of 2003.

• The single-family serious delinquency rate increased to 2.65% as of June 30, 2020, from 0.66% as of 

March 31, 2020, due to economic dislocation caused by the COVID-19 pandemic, which increased 

borrower participation in forbearance plans. The single-family serious delinquency rate excluding loans in 

forbearance was 0.59% as of June 30, 2020. Single-family seriously delinquent loans are loans that are 90 

days or more past due or in the foreclosure process. 

• As of June 30, 2020, 5.7% of Fannie Mae’s single-family guaranty book of business based on loan count 

were in forbearance, the vast majority of which were related to COVID-19; 25% of these loans in 

forbearance were still current. 

Second Quarter 2020 Results 7
Multifamily Business Financial Results

(Dollars in millions) 2Q20 1Q20 Variance 2Q19 Variance

Net interest income $ 838 $ 806 $ 32 $ 808 $ 30 

Fee and other income 19 26 (7) 25 (6) 

Net revenues 857 832 25 833 24 

Fair value gains (losses), net 12 184 (172) 4 8 

Administrative expenses (129) (120) (9) (110) (19) 

Credit-related expense (238) (413) 175 (29) (209) 

Credit enhancement expense (53) (60) 7 (47) (6) 

Change in expected credit enhancement recoveries 65 130 (65) — 65 

Other income (expenses), net 44 (61) 105 30 14 

Income before federal income taxes 558 492 66 681 (123) 

Provision for federal income taxes (113) (99) (14) (120) 7 

Net income $ 445 $ 393 $ 52 $ 561 $ (116) 

Serious delinquency rate 1.00 % 0.05 % 0.05 %

Business Highlights

• The multifamily guaranty book of business increased by over $12 billion during the second quarter of 2020

to nearly $360 billion. The average charged guaranty fee on the multifamily book was stable compared with 

the prior quarter at approximately 72 basis points as of June 30, 2020.

• New multifamily business volume was $34 billion in the first half of 2020. Approximately $48 billion of new 

business capacity remains under the $100 billion multifamily business volume cap structure for the fivequarter period ending December 31, 2020.

• The multifamily serious delinquency rate increased to 1.00% as of June 30, 2020 from 0.05% as of 

March 31, 2020, due to the economic dislocation caused by the COVID-19 pandemic, which increased 

borrower participation in forbearance plans. The multifamily serious delinquency rate excluding loans in 

forbearance was 0.09% as of June 30, 2020. Multifamily seriously delinquent loans are loans that are 60 

days or more past due.

• As of June 30, 2020, based on unpaid principal balance, 1.2% of Fannie Mae’s multifamily guaranty book of 

business was in forbearance, the vast majority of which were related to COVID-19. Seniors Housing loans, 

which constituted 5% of the company’s multifamily guaranty book of business as of June 30, 2020, 

comprised nearly half of the total multifamily unpaid principal balance of loans in forbearance.

Second Quarter 2020 Results 8
Proposed Capital Framework

On May 20, 2020, FHFA released a proposed new regulatory capital framework for Fannie Mae and Freddie Mac. 

The proposed framework is expected to require Fannie Mae to hold significantly more capital than the rule FHFA 

first proposed in June 2018. The proposed rule includes a mortgage-risk-sensitive framework, similar to the 2018 

proposal, but differs from the 2018 proposal in a number of ways, including the following:

• The proposed rule includes supplemental capital requirements relating to the amount and form of the capital 

the company holds, based on definitions of capital used in U.S. banking regulators’ regulatory capital 

framework. The proposal specifies complementary leverage-based and risk-based requirements, which 

together determine the requirements for each tier of capital; 

• The proposed rule requires Fannie Mae to hold capital buffers that can be drawn down in periods of 

financial stress and then rebuilt over time as economic conditions improve. If Fannie Mae falls below the 

prescribed buffer amounts, the company must restrict capital distributions such as stock repurchases and 

dividends, as well as discretionary bonus payments to executives, until the buffer amounts are restored; 

• The proposed rule provides less capital relief for credit risk transfer activities than the 2018 proposal; 

• The proposed rule imposes specific minimum percentages, or “floors,” on the risk-weight applicable to 

single-family and multifamily exposures, as well as to retained portions of credit risk transfer transactions; 

and

• The proposed rule incorporates additional elements based on U.S. banking regulators’ regulatory capital 

framework, including the introduction of the advanced approach to complement the standardized approach 

for measuring risk-weighted assets. 

The capital requirements and buffers established by the proposed rule would have a delayed compliance date, 

unless adjusted by FHFA, of the later of one year from publication of the final rule or the date the company’s 

conservatorship terminates.

Fannie Mae continues to study the proposed capital rule and its potential impact on the company and the housing 

market. Comments on the proposed capital rule are due by August 31, 2020. Fannie Mae does not yet know what 

changes FHFA may make to the capital rule before it is finalized or when it will be finalized. 

See “Legislation and Regulation” in the company’s Second Quarter 2020 Form 10-Q for more information on the 

proposed capital rule, including a discussion of how the final capital rule may impact Fannie Mae’s business.

Selection of Financial Advisor to Assist with Recapitalization Plan

In June 2020, Fannie Mae hired Morgan Stanley & Co. LLC as underwriting financial advisor to assist the company 

in developing and implementing a plan for recapitalizing the company and responsibly ending its conservatorship. 

Fannie Mae’s advisor is working closely with the company, FHFA, and Treasury to consider business and capital 

structures, market impacts and timing, and available capital-raising alternatives, among other items.

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.

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 a quarter. Accordingly, no dividends were 

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

Second Quarter 2020 Results 9
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)

$16.5

$113.9

Net Worth

Remaining Treasury funding commitment

As of June 30, 2020

Dividend Payments and Draws

(Dollars in billions)

$181.4

$119.8

Cumulative dividend payments to Treasury1

Cumulative draws from Treasury2

As of June 30, 2020

(1) Aggregate amount of dividends the company has paid to Treasury on the senior preferred stock from 2008 through June 30, 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 June 30, 2020.

The aggregate liquidation preference of the senior preferred stock was $135.4 billion as of June 30, 2020, 

unchanged from March 31, 2020 as a result of the decrease in the company’s net worth during the first quarter of 

2020. The aggregate liquidation preference of the senior preferred stock will increase to $138.0 billion as of 

September 30, 2020 due to the $2.5 billion increase in the company’s net worth during the second quarter of 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 second quarter of 2020 are available in the accompanying Annex; 

however, investors and interested parties should read the company’s Second 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 Second Quarter 2020 Form 10-Q. Additional information about the company’s 

financial and credit performance is contained in Fannie Mae’s Q2 2020 Financial Supplement at 

www.fanniemae.com.

# # #

In this release, the company has presented a number of estimates, forecasts, expectations, and other forwardlooking statements, including statements regarding: the company’s business plans, the company’s future business 

and financial results, the future impact of the COVID-19 pandemic on the company’s business and financial results, 

the impact of FHFA’s proposed capital framework on the company’s business and results, 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 

Second Quarter 2020 Results 10
regarding numerous factors and are subject to significant uncertainties and changes in circumstances. Actual 

results, and future projections, could be materially different from what is set forth in these forward-looking 

statements due to a variety of factors, including those described in “Forward-Looking Statements” and “Risk 

Factors” in the company’s Second 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.

Second Quarter 2020 Results 11
ANNEX

FANNIE MAE

(In conservatorship)

Condensed Consolidated Balance Sheets — (Unaudited)

(Dollars in millions)

As of

June 30, 

2020

December 31, 

2019

ASSETS

Cash and cash equivalents $ 54,510 $ 21,184 

Restricted cash (includes $58,581 and $33,294, respectively, related to consolidated trusts) 65,714 40,223 

Federal funds sold and securities purchased under agreements to resell or similar arrangements 25,450 13,578 

Investments in securities:

Trading, at fair value (includes $5,727 and $3,037, respectively, pledged as collateral) 106,744 48,123 

Available-for-sale, at fair value (with an amortized cost of $1,990, net of allowance for credit losses of 

 $3 as of June 30, 2020) 2,120 2,404 

Total investments in securities 108,864 50,527 

Mortgage loans:

Loans held for sale, at lower of cost or fair value 7,580 6,773 

Loans held for investment, at amortized cost:

Of Fannie Mae 107,771 94,911 

Of consolidated trusts 3,356,950 3,241,494 

Total loans held for investment (includes $7,303 and $7,825, respectively, at fair value) 3,464,721 3,336,405 

Allowance for loan losses (12,966) (9,016) 

Total loans held for investment, net of allowance 3,451,755 3,327,389 

Total mortgage loans 3,459,335 3,334,162 

Advances to lenders 7,983 6,453 

Deferred tax assets, net 13,119 11,910 

Accrued interest receivable, net (includes $9,451 and $8,172, respectively, related to consolidated trusts

 and net of an allowance of $172 as of June 30, 2020) 9,679 8,604 

Acquired property, net 1,844 2,366 

Other assets 14,178 14,312 

Total assets $ 3,760,676 $ 3,503,319 

LIABILITIES AND EQUITY

Liabilities:

Accrued interest payable (includes $9,312 and $9,361, respectively, related to consolidated trusts) $ 10,054 $ 10,228 

Debt:

Of Fannie Mae (includes $4,546 and $5,687, respectively, at fair value) 275,637 182,247 

Of consolidated trusts (includes $23,883 and $21,880, respectively, at fair value) 3,444,338 3,285,139 

Other liabilities (includes $1,638 and $376, respectively, related to consolidated trusts) 14,170 11,097 

Total liabilities 3,744,199 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 (116,909) (118,776) 

Accumulated other comprehensive income 133 131 

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) 16,477 14,608 

Total liabilities and equity $ 3,760,676 $ 3,503,319 

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

Second Quarter 2020 Results 12
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 June 30,

For the Six Months 

Ended June 30,

2020 2019 2020 2019

Interest income:

Trading securities $ 219 $ 432 $ 535 $ 859 

Available-for-sale securities 26 45 57 98 

Mortgage loans 27,007 29,511 55,945 59,373 

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

arrangements 14 257 121 520 

Other 25 41 59 73 

Total interest income 27,291 30,286 56,717 60,923 

Interest expense:

Short-term debt (54) (119) (156) (244) 

 Long-term debt (21,460) (24,940) (45,437) (50,656) 

Total interest expense (21,514) (25,059) (45,593) (50,900) 

Net interest income 5,777 5,227 11,124 10,023 

Benefit (provision) for credit losses (12) 1,225 (2,595) 1,875 

Net interest income after benefit (provision) for credit losses 5,765 6,452 8,529 11,898 

Investment gains (losses), net 149 461 (9) 594 

Fair value losses, net (1,018) (754) (1,294) (1,585) 

Fee and other income 90 113 210 247 

Non-interest loss (779) (180) (1,093) (744) 

Administrative expenses:

Salaries and employee benefits (382) (376) (775) (762) 

Professional services (231) (233) (443) (458) 

Other administrative expenses (141) (135) (285) (268) 

Total administrative expenses (754) (744) (1,503) (1,488) 

Foreclosed property expense (10) (128) (90) (268) 

Temporary Payroll Tax Cut Continuation Act of 2011 (“TCCA”) fees (660) (600) (1,297) (1,193) 

Credit enhancement expense (360) (276) (736) (492) 

Change in expected credit enhancement recoveries 273 — 461 — 

Other expenses, net (261) (203) (479) (365) 

Total expenses (1,772) (1,951) (3,644) (3,806) 

Income before federal income taxes 3,214 4,321 3,792 7,348 

Provision for federal income taxes (669) (889) (786) (1,516) 

Net income 2,545 3,432 3,006 5,832 

Other comprehensive income (loss):

Changes in unrealized losses on available-for-sale securities, net of 

reclassification adjustments and taxes (11) (65) 7 (101) 

Other, net of taxes (2) (2) (5) (5) 

Total other comprehensive income (loss) (13) (67) 2 (106) 

Total comprehensive income $ 2,532 $ 3,365 $ 3,008 $ 5,726 

Net income $ 2,545 $ 3,432 $ 3,006 $ 5,832 

Dividends distributed or amounts attributable to senior preferred stock (2,532) (3,365) (3,008) (5,726) 

Net income (loss) attributable to common stockholders $ 13 $ 67 $ (2) $ 106 

Earnings per share:

Basic $ 0.00 $ 0.01 $ 0.00 $ 0.02 

Diluted 0.00 0.01 0.00 0.02 

Weighted-average common shares outstanding:

Basic 5,867 5,762 5,867 5,762 

Diluted 5,893 5,893 5,867 5,893 

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

Second Quarter 2020 Results 13
FANNIE MAE

(In conservatorship)

Condensed Consolidated Statements of Cash Flows — (Unaudited)

(Dollars in millions)

For the Six Months 

Ended June 30,

2020 2019

Net cash provided by (used in) operating activities $ (39,322) $ 2,180 

Cash flows provided by (used in) investing activities:

Proceeds from maturities and paydowns of trading securities held for investment 23 28 

Proceeds from sales of trading securities held for investment — 49 

Proceeds from maturities and paydowns of available-for-sale securities 189 268 

Proceeds from sales of available-for-sale securities 121 376 

Purchases of loans held for investment (293,666) (90,612) 

Proceeds from repayments of loans acquired as held for investment of Fannie Mae 4,634 5,557 

Proceeds from sales of loans acquired as held for investment of Fannie Mae 427 5,821 

Proceeds from repayments and sales of loans acquired as held for investment of consolidated trusts 448,375 211,956 

Advances to lenders (123,805) (54,440) 

Proceeds from disposition of acquired property and preforeclosure sales 3,239 3,870 

Net change in federal funds sold and securities purchased under agreements to resell or similar arrangements (11,872) 13,376 

Other, net (937) (743) 

Net cash provided by investing activities 26,728 95,506 

Cash flows provided by (used in) financing activities:

Proceeds from issuance of debt of Fannie Mae 393,641 374,284 

Payments to redeem debt of Fannie Mae (299,933) (389,779) 

Proceeds from issuance of debt of consolidated trusts 401,749 158,970 

Payments to redeem debt of consolidated trusts (423,582) (224,145) 

Payments of cash dividends on senior preferred stock to Treasury — (5,601) 

Other, net (464) 132 

Net cash provided by (used in) financing activities 71,411 (86,139) 

Net increase in cash, cash equivalents and restricted cash 58,817 11,547 

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

Cash, cash equivalents and restricted cash at end of period $ 120,224 $ 60,970 

Cash paid during the period for:

Interest $ 57,733 $ 57,637 

Income taxes — 700 

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

Second Quarter 2020 Results 14
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 March 31, 2020 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (119,454) $ 146 $ (7,400) $ 13,945 

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

Comprehensive income:

Net income — — — — — — 2,545 — — 2,545 

Other comprehensive income, net of tax effect:

Changes in net unrealized gains on available-

 for-sale securities (net of taxes of $3) — — — — — — — (11) — (11) 

Reclassification adjustment for gains included in

 net income (net of taxes of $0) — — — — — — — — — — 

Other (net of taxes of $0) — — — — — — — (2) — (2) 

Total comprehensive income 2,532 

Balance as of June 30, 2020 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (116,909) $ 133 $ (7,400) $ 16,477 

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 — — — — — — 3,006 — — 3,006 

Other comprehensive income, net of tax effect:

Changes in net unrealized gains on available-

 for-sale securities (net of taxes of $1) — — — — — — — 4 — 4 

Reclassification adjustment for gains included in

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

Other (net of taxes of $1) — — — — — — — (5) — (5) 

Total comprehensive income 3,008 

Balance as of June 30, 2020 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (116,909) $ 133 $ (7,400) $ 16,477 

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

Second Quarter 2020 Results 15
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 March 31, 2019 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (128,175) $ 283 $ (7,400) $ 5,361 

Senior preferred stock dividends paid — — — — — — (2,361) — — (2,361) 

Comprehensive income:

Net income — — — — — — 3,432 — — 3,432 

Other comprehensive income, net of tax effect:

Changes in net unrealized gains on available-

 for-sale securities (net of taxes of $3) — — — — — — — 9 — 9 

Reclassification adjustment for gains included in

 net income (net of taxes of $19) — — — — — — — (74) — (74) 

Other (net of taxes of $0) — — — — — — — (2) — (2) 

Total comprehensive income 3,365 

Balance as of June 30, 2019 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (127,104) $ 216 $ (7,400) $ 6,365 

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 — — — — — — (5,601) — — (5,601) 

Comprehensive income:

Net income — — — — — — 5,832 — — 5,832 

Other comprehensive income, net of tax effect:

Changes in net unrealized gains on available-

 for-sale securities (net of taxes of $5) — — — — — — — 17 — 17 

Reclassification adjustment for gains included in

 net income (net of taxes of $31) — — — — — — — (118) — (118) 

Other (net of taxes of $1) — — — — — — — (5) — (5) 

Total comprehensive income 5,726 

Balance as of June 30, 2019 1 556 1,158 $ 120,836 $ 19,130 $ 687 $ (127,104) $ 216 $ (7,400) $ 6,365 

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

Second Quarter 2020 Results 16