Fannie Needs $4.6 Billion More in Bailout Money
Fannie Mae announced Wednesday that it will ask for an additional $4.6 billion in federal aid after posting a big loss in the fourth quarter and a disagreement with Bank of America, Reuters News reports.
Fannie Mae said it had a $2.4 billion loss in the fourth quarter, bringing the government-sponsored enterprise’s total to $16.9 billion in losses for 2011.
The government took control of Fannie Mae and fellow GSE, Freddie Mac, in September 2008. Both GSEs have faced steep losses from a surge in defaulting loans the last few years.
Besides the fourth quarter losses, Fannie said in a statement that a disagreement with Bank of America may also prompt the GSE to ask for more aid. Bank of America announced last week that it would no longer be selling certain mortgages to Fannie Mae.
“If Fannie Mae collects less than the amount it expects from Bank of America, Fannie Mae may be required to seek additional funds from Treasury,” the company said in a press release.
To date, Fannie has borrowed more than $116 billion from the government.