Fannie Mae 2010 Annual Report Download - page 308

Managed Loans
We define “managed loans” as on-balance sheet mortgage loans as well as mortgage loans that we have
securitized in unconsolidated portfolio securitization trusts. As noted above, our adoption of the new
accounting standards resulted in a significant increase in mortgage loans held for investment and a decrease in
loans held for sale in our consolidated balance sheets, as well as a decrease in the amount of loans securitized
in unconsolidated portfolio securitization trusts. The following table displays the unpaid principal balances of
managed loans, including those managed loans that are delinquent as of December 31, 2010 and 2009.
Unpaid
Principal Balance
Principal Amount of
Delinquent Loans
(Dollars in millions)
As of December 31, 2010
Loans held for investment
Of Fannie Mae . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 423,686 $141,342
Of consolidated trusts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,565,347 34,080
Loans held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 964 127
Securitized loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,147 78
Total loans managed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,992,144 $175,627
As of December 31, 2009
Loans held for investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 395,551 $ 51,051
Loans held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,992 140
Securitized loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 187,922 5,161
Total loans managed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 604,465 $ 56,352
Qualifying Sales of Portfolio Securitizations
The gain or loss on a portfolio securitization transaction that qualifies as a sale depends, in part, on the
carrying amount of the financial assets sold. Prior to January 1, 2010, we allocated the carrying amount of the
financial assets sold between the assets sold and the interests retained, if any, based on their relative fair value
at the date of sale. Further, we recognized our recourse obligations at their full fair value at the date of sale,
which serves as a reduction of sale proceeds in the gain or loss calculation.
Beginning January 1, 2010, we recognize all assets obtained and all liabilities incurred in a portfolio
securitization at fair value. We recorded a net gain on portfolio securitizations of $26 million, $1.0 billion and
$49 million for the years ended December 31, 2010, 2009 and 2008, respectively. We recognize these amounts
as a component of “Investment gains (losses), net” in our consolidated statements of operations. We
recognized proceeds from the initial sale of securities from portfolio securitizations of $660 million,
$85.7 billion and $30.1 billion for the years ended December 31, 2010, 2009 and 2008, respectively.
4. Mortgage Loans
We own both single-family mortgage loans, which are secured by four or fewer residential dwelling units, and
multifamily mortgage loans, which are secured by five or more residential dwelling units. We classify these
loans as either HFI or HFS. We report HFI loans at the unpaid principal balance, net of unamortized
premiums and discounts, other cost basis adjustments, and an allowance for loan losses. We report HFS loans
at the lower of cost or fair value determined on a pooled basis, and record valuation changes in our
consolidated statements of operations. Our prospective adoption on December 31, 2010 of a new accounting
F-50
FANNIE MAE
(In conservatorship)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)