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Fannie Mae Reports Higher After-Tax Net Income In Q3; Expects To Pay $4 Bln Dividend To Treasury

Fannie Mae (FNMA) reported that its net income attributable to common stockholders for the third quarter was $36 million or $0.01 per share, compared to net loss of $25 million or breakeven per share in the prior-year period.

Fannie Mae's after-tax net income for the quarter of $4.01 billion rose from $3.02 billion in the previous-year quarter.

Total comprehensive income for the quarter was $3.98 billion, up from $3.05 billion in the year-ago period.

Net revenues for the quarter increased to $5.37 billion from $5.27 billion in the same period last year.

Of this, net interest income grew to $5.369 billion from $5.274 billion a year ago, primarily derived from guaranty fees on the company's $3.3 trillion guaranty book of business. Non-interest income fell to $823 million from $1.22 billion last year.

Fannie Mae reported a net worth of $7.0 billion as of September 30, 2018. As a result, the company said it expects to pay a $4.0 billion dividend to Treasury by December 31, 2018. Through the third quarter of 2018, the company has paid $171.8 billion in dividends to Treasury.

Looking ahead, Fannie Mae said it expects to remain profitable on an annual basis for the foreseeable future. However, certain factors could result in significant volatility in the company's financial results from quarter to quarter or year to year.

The company noted that potential for significant volatility in its financial results could result in a net loss in a future quarter. The company is permitted to retain up to $3.0 billion in capital reserves as a buffer in the event of a net loss in a future quarter.

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