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Mortgage Zombie Freddie Mac Reports Q4 Loss; Another $5 Billion In Taxpayer Money Out The Window To Support Fake Home Prices
From the press release:
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Fourth quarter 2009 net loss was $6.5 billion. After the dividend
payment of $1.3 billion to the U.S. Department of the Treasury
(Treasury) on the senior preferred stock, net loss attributable to
common stockholders was $7.8 billion, or $2.39 per diluted common
share, for the fourth quarter of 2009.-
Fourth quarter results reflect net interest income of $4.5 billion,
a write-down of $3.4 billion of the carrying value of the company’s
Low-Income Housing Tax Credit (LIHTC) partnership investments and
credit-related expenses of $7.1 billion.
-
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Full-year 2009 net loss was $21.6 billion. After dividend payments
of $4.1 billion during the year to Treasury on the senior preferred
stock, net loss attributable to common stockholders was $25.7 billion,
or $7.89 per diluted common share, for the full-year 2009. -
Net worth at December 31, 2009 was $4.4 billion. As a result of the
positive net worth, no additional funding from Treasury was required
under the terms of the Senior Preferred Stock Purchase Agreement
(Purchase Agreement) for the fourth quarter. -
In 2009, Freddie Mac played a critical role in supporting the nation’s housing market by:
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Providing $548.4 billion of liquidity to the mortgage market,
helping finance approximately 2.2 million conforming single-family
loans and approximately 253,000 units of multifamily rental housing. -
Helping more than 272,000 borrowers stay in their homes or sell
their properties through the company’s long-standing foreclosure
avoidance programs and the Home Affordable Modification program (HAMP),
including 129,380 loans that remained in HAMP trial periods as of
December 31, 2009 according to information provided by the Making Home
Affordable (MHA) program administrator. -
Refinancing approximately $379 billion of single-family loans,
creating an estimated $4.5 billion in annual interest savings for
borrowers nationwide – this includes approximately 169,000 borrowers
whose payments were reduced by an average of $2,000 annually under the
Freddie Mac Relief Refinance MortgageSM.
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Freddie Mac (NYSE:FRE) today reported a net loss of $21.6 billion for
the full-year 2009, compared to a net loss of $50.1 billion for the
full-year 2008. After dividend payments of $4.1 billion during the year
on its senior preferred stock to Treasury, Freddie Mac reported a net
loss attributable to common stockholders of $25.7 billion, or $7.89 per
diluted common share, for the full-year 2009, compared to a net loss
attributable to common stockholders of $50.8 billion, or $34.60 per
diluted common share, for the full-year 2008.
the full-year 2009, compared to a net loss of $50.1 billion for the
full-year 2008. After dividend payments of $4.1 billion during the year
on its senior preferred stock to Treasury, Freddie Mac reported a net
loss attributable to common stockholders of $25.7 billion, or $7.89 per
diluted common share, for the full-year 2009, compared to a net loss
attributable to common stockholders of $50.8 billion, or $34.60 per
diluted common share, for the full-year 2008.
For the quarter ended December 31, 2009, the company reported a net
loss of $6.5 billion, compared to a net loss of $5.4 billion for the
quarter ended September 30, 2009. After the dividend payment of $1.3
billion on its senior preferred stock to Treasury, Freddie Mac reported
a net loss attributable to common stockholders of $7.8 billion, or
$2.39 per diluted common share, in the fourth quarter of 2009, compared
to a net loss attributable to common stockholders of $6.7 billion, or
$2.06 per diluted common share, in the third quarter of 2009.
Fourth quarter and full-year 2009 results were negatively impacted by
$7.1 billion and $29.8 billion in credit-related expenses,
respectively, reflecting the challenging economic conditions during
2009. In addition, fourth quarter and full-year 2009 results were
affected by $3.4 billion and $4.2 billion in LIHTC partnerships
expense, respectively, primarily due to the write-down of the carrying
value of the company's LIHTC partnership investments to zero as of
December 31, 2009. These results were partially offset by net interest
income of $4.5 billion in the fourth quarter of 2009 and $17.1 billion
in the full-year 2009, mainly due to lower funding costs.
$7.1 billion and $29.8 billion in credit-related expenses,
respectively, reflecting the challenging economic conditions during
2009. In addition, fourth quarter and full-year 2009 results were
affected by $3.4 billion and $4.2 billion in LIHTC partnerships
expense, respectively, primarily due to the write-down of the carrying
value of the company's LIHTC partnership investments to zero as of
December 31, 2009. These results were partially offset by net interest
income of $4.5 billion in the fourth quarter of 2009 and $17.1 billion
in the full-year 2009, mainly due to lower funding costs.
Freddie Mac had positive net worth of $4.4 billion at December 31,
2009, compared to positive net worth of $9.4 billion at September 30,
2009. As a result of the positive net worth, no additional funding was
required from Treasury under the terms of the Purchase Agreement for
the fourth quarter. The decline in positive net worth for the fourth
quarter of 2009 resulted from the fourth quarter 2009 net loss of $6.5
billion and the dividend payment of $1.3 billion to Treasury on the
senior preferred stock, partially offset by a $2.7 billion decrease in
unrealized losses recorded in accumulated other comprehensive income
(loss) (AOCI) primarily driven by improved values on the company's
available-for-sale (AFS) securities. Freddie Mac had a net worth
deficit of $30.6 billion at December 31, 2008.
"In a trying and turbulent year, Freddie Mac played a critical role
in supporting the nation's housing recovery," said Freddie Mac Chief
Executive Officer Charles E. Haldeman, Jr. "We provided a constant
source of liquidity – purchasing one out of every four home loans
originated last year – and our presence in the market helped keep
mortgage rates at historic lows. We also helped approximately 1.8
million borrowers lower their mortgage payments, and more than a
quarter million families avoid foreclosure.
"We start 2010 with some early signs of stabilization in the housing
market, with house prices and home sales likely nearing the bottom
sometime in 2010. We expect that low mortgage rates, relatively high
affordability and the homebuyer tax credit will help continue to fuel
the recovery. Still, the housing recovery remains fragile, with
significant downside risk posed by high unemployment and a potential
large wave of foreclosures. That's why our commitment to help
struggling homeowners is steadfast – and we will continue working to
find ways to keep families in their homes through both our own programs
and the Obama Administration's Making Home Affordable Program."
FRE Supplemental presentation:
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WTF? Will someone please tell me when this BS is gonna end?
(loaded question)
When China tells us it's "gonna end."
On the plus side, at least we have plenty of reserves to cover it...
[/sarcasm]
Heckuva job, Freddie.
This is ridiculous, how long is the tax payer going to have to open their wallets to support these zombies? Who decides these things? I can just imagine the fraud, the 'get while the gettin's good' mentality. I mean really, they have to know that it's over, so there's no prudence or responsibility at all.
Every dollar lost means another dollar in taxes from somewhere, that is unless to govt comes to its senses and shrinks itself.
This is just nuts people...nuts.
"This is just nuts people...nuts."
I agree with you wholeheartedly and I'm completely sympathetic with your anger and distress. Now, without being insulting or condescending, what are you and me and everyone else going to do about it? It won't end any time soon. This is a roaring forest fire that still has plenty of dead wood and old growth tress left to fuel the fire. The political class is deeply captured by the financial elites, who are controlling the financial press and regulators.
There's no white knight who's going to ride in and save us from ourselves. There's no easy way out of this, there's no way we can keep what we have, keep the current system afloat and reverse the forest fire. While it will eventually burn all the remaining fuel and self estinguish, something has to give now or later. Since the people and entities running the scam have shown the world they're ready to do anything and everything needed to keep this fire going, when are we going to show the world we're ready to do everything and anything needed to put the fire out?
Unfortunately, this is not a rhetorical question?
This is a roaring forest fire that still has plenty of dead wood and old growth tress left to fuel the fire.
Too much uncleared underbrush. Periodic razing of deadwood is supposed to be a natural, replenishing thing, making room for new things to grow. Instead, we run around calling it "old growth" forest, and let's not let any of it ever burn, or clear it out, and what happens is a states-wide conflagration sooner or later. Just like with all this extend-and-pretend, TBTF, let's not let anyone go bankrupt in a so-called capitalist society. It's going to end very badly, with all of us animals stampeding for safety, where none can be found.
We are walking a thin line between losing what democracy we have left and the powers that be implementing the system that they have in mind. I have no doubt that they have explored the idea of people rising up and a revolution, there are plans to demobolize this. So our choices as I see them are uniting the people against this treason and rising up against it or accepting the game plan for the elitist. It will be harder to change things once they have total control. The people have to start leading instead of being lead. Change is sometimes painful and we might not see the fruits of our labor in our lifetimes, but we have to do it for the future and the generations to come.
Go Galt.
My Butt "Freddie Mac had positive net worth of $4.4 billion at December 31, 2009..."
Based on whose evaluation of what?
Baed on mark to make believe of course!
Though ZH'ers already knew that. it is a massive fraud scheme that makes Madoff look like a punter.
Ha! That's almost as good as "intellectually subprime."
OT, or not, you decide.
Petition supporting Icelanders against having to pay off bankster debt. Wish it was phrased better... but may be worth while.
We are Iceland. We did not want them to bailout the banks and they did it against our will. Iceland is now in the fix they are in because they were not properly represented. When do we get to this point? Will we ever get to vote to default?
http://www.savethepeopleoficeland.com/
"When do we get to this point? Will we ever get to vote to default?"
When you average joe/jane is faced with either a large increase in taxes or withdrawl of government programs.
It has not hit home for most people and thats why nothing has happened.
I wish the goverment would get the hell out of the real estate market, I have been in this rental for 2 years waiting, and am still waiting, waiting.......
What? You don't want to buy into this artificially inflated market? It's a dip. Buy, buy, buy!
[/sarcasm]
How long have Japanese prices been fallen, 20 years?
Don't worry. The criminal organization known as the Federal Reserve has already printed $1.5 trillion to cover the losses. They'll keep on printing as long as it's needed. That's what you can do when you don't gold and silver backing your money.
Our enitre domestic monetary policy, tax incentives, and fiscal policies are now designed purely to keep the price tag of a $250,000 house at $400,000.
http://www.housingwire.com/2010/02/23/nar-to-congress-turn-fannie-and-fr... NAR wants Fan/Fred to become non-profits. Note to NAR: they already are non-profits. How much more non-profitable do they need to become?
+100
My favorite part is that because Fannie and Freddie are GSE's they were exempt from the pay czar, which means that their CEOs got like 6 million a piece to give out free money and run the company into the ground. Fools, I would have done the same thing for only 3...
They should be paid federal scale, period. They are just like HUD now.
Dude,
I know you need to make a buck, but trading a glowing Peter Shiff for Senate promo article (yesterday) for his brokerage company buying banner ads all over the site is inappropriate. Sorry to post this on an unrelated article, but the ad's in my face now, reminding me of the "journalism" I saw yesterday. Don't let your great site lose its respectability.
What to do. Get out of debt, Live within your means, even if it means giving up smoking, sodas, eating out five times a week (or more), cable TV and that third 50" HDTV. Use the gray matter to plan for conservation. Utilize alternatives, learn how to make things yourself, recycle and be thrifty. Learn how good water tastes, enjoy your friends and family and pets. Buy what you need, not what strikes your fancy. The Government is not going to tell you to be self-sufficient, you need to learn it for yourself. The final exam appears to be drawing nearer, are you ready for it?
Having toiled on the multifamily side at Fannie for 5 years (I use the term 'toil' loosely, there was a lotta sitting around, screwing around, useless meetings, etc.), I am perhaps a bit more familiar with the GSEs than most. Conservatives, if they'd had their way, would have eliminated the risk the GSEs presented to the economy and the taxpayer. The risks were well known - see the long string of WSJ op-eds on the topic from the late '90s on, and you gotta read this:
http://money.cnn.com/magazines/moneymag/moneymag_archive/2003/09/01/3486...
But GW Bush failed - his biggest failure IMO - and La. Rep. Richard Baker failed (though he made a valiant effort) and the libs led by Bawney and Dodd prevailed. And now these scumsucking libs deny culpability. They are such pigs, and their big-gubmint ideology is such an awful joke.
The Band of the Hand can only create a Potemkin demand.
FNM and FRE...they're about as cool as Barney Frank in a gimpsuit stuffed with a big orange butt plug.
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