Sunday, December 05, 2004

Fannie Mae Weakens Financially

A quick scan of Fannie Mae quarterly financial data can be an eye-opener. Of course, the most recent quarter isn't available due to the accounting problem, but lets use what is available; the four quarters from June 30, 2004 and back. Compared to the quarter ending September 30th, 2003, Net Income has declined 58%. And if the Securities and Exchange Commission rules against the mortgage giant on accounting for derivatives, the firm will have to post a 9 billion dollar charge. Investors have also upped the shares "short"; that is betting the stock price will fall, some 2.28 million shares in the past month.


At 3:47 PM, Blogger Ben Jones said...

12.16.04 Todays SEC ruling against Fannie Mae will cost the GSE. "The Securities and Exchange Commission's chief accountant has directed Fannie Mae to restate its earnings for violating hedge accounting rules, a move that could wipe out $9 billion or more in earnings dating back to 2001".


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