Fannie Mae 2004 Annual Report Download - page 142

Conventional
(1)
Government
(2)
Conventional
(1)
Government
(2)
Conventional
(1)
Government
(2)
Single-Family Multifamily Total
As of December 31, 2002
(Restated)
(Dollars in millions)
Mortgage portfolio:
(3)
Mortgage loans
(4)
. . . . . . $ 295,457 $ 6,404 $19,485 $1,898 $ 314,942 $ 8,302
Fannie Mae MBS
(4)
. . . . . 374,555 3,230 542 2,056 375,097 5,286
Agency mortgage-related
securities
(4)(5)
. . . . . . . . 32,218 16,042 — 85 32,218 16,127
Mortgage revenue bonds. . 6,378 7,614 3,728 1,930 10,106 9,544
Other mortgage-related
securities
(6)
. . . . . . . . . 27,938 75 69 75 28,007 150
Total mortgage portfolio . . . 736,546 33,365 23,824 6,044 760,370 39,409
Fannie Mae MBS held by
third parties
(7)
. . . . . . . . . 950,690 36,225 50,772 2,752 1,001,462 38,977
Book of business . . . . . 1,687,236 69,590 74,596 8,796 1,761,832 78,386
Other
(8)
. . . . . . . . . . . . . . . 576 — 10,906 545 11,482 545
Total mortgage credit
book of business . . . . $1,687,812 $69,590 $85,502 $9,341 $1,773,314 $78,931
(1)
Refers to mortgage loans and mortgage-related securities that are not guaranteed or insured by the U.S. government or
any of its agencies.
(2)
Refers to mortgage loans and mortgage-related securities guaranteed or insured by the U.S. government or one of its
agencies.
(3)
Mortgage portfolio data is reported based on unpaid principal balance.
(4)
Mortgage loan data includes mortgage-related securities that were consolidated and reported in our consolidated bal-
ance sheets as loans of $152.7 billion, $162.5 billion and $135.8 billion as of December 31, 2004, 2003 and 2002,
respectively.
(5)
Includes mortgage-related securities issued by Freddie Mac and Ginnie Mae.
(6)
Includes mortgage-related securities issued by entities other than Fannie Mae, Freddie Mac or Ginnie Mae.
(7)
Includes Fannie Mae MBS held by third-party investors. The principal balance of resecuritized Fannie Mae MBS is
included only once.
(8)
Includes additional single-family and multifamily credit enhancements that we provide not otherwise reflected in the
table.
Our strategy in managing mortgage credit risk consists of three primary components: (1) acquisition policy
and standards; (2) portfolio diversification and monitoring; and (3) credit loss management. We use various
metrics to evaluate credit performance in our mortgage credit book of business. We estimate incurred credit
losses inherent in our mortgage credit book of business as of each balance sheet date and maintain a combined
balance of allowance for loan losses and reserve for guaranty losses at a level we believe reflects these losses.
Acquisition Policy and Standards
Single-Family
Our Single-Family business is responsible for pricing and managing credit risk relating to the portion of our
single-family mortgage credit book of business consisting of whole single-family mortgage loans and Fannie
Mae MBS backed by single-family mortgage loans (whether held in our portfolio or held by third parties).
Accordingly, unless otherwise noted, the credit statistics on our conventional single-family mortgage credit
book provided in this report relate only to this portion of our conventional single-family mortgage credit book
managed by our Single-Family business, for which we have more detailed loan-level information, which
constituted approximately 92%, 95% and 95% of our total conventional single-family mortgage credit book of
business as of December 31, 2004, 2003 and 2002, respectively.
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