By Lynn Adler
NEW YORK, May 7 (Reuters) - Fannie Mae, the largest buyer of residential home loans, said on Friday its March mortgage portfolio was inflated by buyouts of seriously delinquent loans repurchased from securities pools.
The company's total book of business, gross mortgage portfolio, commitments to buy loans and net and new business acquisitions included about $40 billion of loans it bought back from the pools.
Excluding those repurchases, which will not be reflected as liquidations from the mortgage-backed securities that Fannie Mae holds until April data, the total book of business would have declined 2.3 percent in March. Including them, there was a 2.8 percent increase to a total book of business of $3.263 trillion.
The company, like its counterpart Freddie Mac, is in the process of buying back tens of billions of dollars in troubled home loans that now collateralize its securities. The loans being repurchased are at least 120 days late and are a capital drain.
The serious delinquency rate on Fannie Mae single-family loans rose 7 basis points in February, the latest month for which data is available, to 5.59 percent. The rate rose 4 basis points on multifamily loans to 0.73 percent.
A year earlier, the single-family rate stood at 2.96 percent and the multifamily rate at 0.32 percent.
Fannie Mae also said in its March portfolio summary that the unpaid principal balance of its gross mortgage portfolio spiked by 87.1 percent to $764.8 billion due to the repurhases that were not reflected as liquidated from the MBS trusts yet.
As of March 31, the gross portfolio end balance, taking into account $25.5 billion in net commitments to sell mortgage assets, stood at $739.3 billion, Fannie Mae said.
Retained holdings were $725.9 billion in February and $783.9 billion in March 2009.
Fannie Mae's total debt outstanding grew to $800 billion in March from $767 billion the prior month. A year ago, the company had $869.3 billion outstanding.
CAPITAL STRAIN
Fannie Mae has yet to report first quarter earnings.
But Freddie Mac on May 5 reported an $8 billion first-quarter loss, which included a dividend payment on senior preferred stock owned by the Treasury Department, and asked the government for an added $10.6 billion in aid. See .
That draw would bring federal aid for Fannie Mae and Freddie Mac to more than $136 billion.
The Treasury has provided an open credit spigot for the two companies through 2012.
Fannie and Freddie were taken under government control in September 2008, in the midst of the deepest housing crisis since the Great Depression, as loan defaults and record foreclosures slashed their capital.
Fannie Mae is spreading its larger amount of loan buyouts over several months whereas Freddie conducted the lion's share in a single month.
In the aftermath, Freddie reported on April 30 the first decline in the single-family delinquency rate in three years. Still, the 4.13 percent rate in March was well above 2.41 percent a year earlier. See.
(Editing by Andrew Hay) Keywords: FANNIEMAE/PORTFOLIO (lynn.adler@thomsonreuters.com; +1 646 223-6307; Reuters Messaging: lynn.adler.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
NEW YORK, May 7 (Reuters) - Fannie Mae, the largest buyer of residential home loans, said on Friday its March mortgage portfolio was inflated by buyouts of seriously delinquent loans repurchased from securities pools.
The company's total book of business, gross mortgage portfolio, commitments to buy loans and net and new business acquisitions included about $40 billion of loans it bought back from the pools.
Excluding those repurchases, which will not be reflected as liquidations from the mortgage-backed securities that Fannie Mae holds until April data, the total book of business would have declined 2.3 percent in March. Including them, there was a 2.8 percent increase to a total book of business of $3.263 trillion.
The company, like its counterpart Freddie Mac, is in the process of buying back tens of billions of dollars in troubled home loans that now collateralize its securities. The loans being repurchased are at least 120 days late and are a capital drain.
The serious delinquency rate on Fannie Mae single-family loans rose 7 basis points in February, the latest month for which data is available, to 5.59 percent. The rate rose 4 basis points on multifamily loans to 0.73 percent.
A year earlier, the single-family rate stood at 2.96 percent and the multifamily rate at 0.32 percent.
Fannie Mae also said in its March portfolio summary that the unpaid principal balance of its gross mortgage portfolio spiked by 87.1 percent to $764.8 billion due to the repurhases that were not reflected as liquidated from the MBS trusts yet.
As of March 31, the gross portfolio end balance, taking into account $25.5 billion in net commitments to sell mortgage assets, stood at $739.3 billion, Fannie Mae said.
Retained holdings were $725.9 billion in February and $783.9 billion in March 2009.
Fannie Mae's total debt outstanding grew to $800 billion in March from $767 billion the prior month. A year ago, the company had $869.3 billion outstanding.
CAPITAL STRAIN
Fannie Mae has yet to report first quarter earnings.
But Freddie Mac on May 5 reported an $8 billion first-quarter loss, which included a dividend payment on senior preferred stock owned by the Treasury Department, and asked the government for an added $10.6 billion in aid. See .
That draw would bring federal aid for Fannie Mae and Freddie Mac to more than $136 billion.
The Treasury has provided an open credit spigot for the two companies through 2012.
Fannie and Freddie were taken under government control in September 2008, in the midst of the deepest housing crisis since the Great Depression, as loan defaults and record foreclosures slashed their capital.
Fannie Mae is spreading its larger amount of loan buyouts over several months whereas Freddie conducted the lion's share in a single month.
In the aftermath, Freddie reported on April 30 the first decline in the single-family delinquency rate in three years. Still, the 4.13 percent rate in March was well above 2.41 percent a year earlier. See.
(Editing by Andrew Hay) Keywords: FANNIEMAE/PORTFOLIO (lynn.adler@thomsonreuters.com; +1 646 223-6307; Reuters Messaging: lynn.adler.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.