Fannie Mae 2006 Annual Report Download - page 301

Single-Family HCD
Capital
Markets Total
For the Year Ended December 31, 2004
(Dollars in millions)
Net interest income (expense)
(1)
. . . . . . . . . . . . . . . . . . . . . $ 452 $ (126) $ 17,755 $ 18,081
Guaranty fee income (expense)
(2)
. . . . . . . . . . . . . . . . . . . . . 4,336 449 (1,070) 3,715
Losses on certain guaranty contracts
(3)
. . . . . . . . . . . . . . . . . (43) (68) — (111)
Investment gains (losses), net . . . . . . . . . . . . . . . . . . . . . . . 84 — (446) (362)
Derivatives fair value losses, net . . . . . . . . . . . . . . . . . . . . . — — (12,256) (12,256)
Debt extinguishment losses, net . . . . . . . . . . . . . . . . . . . . . . — — (152) (152)
Losses from partnership investments . . . . . . . . . . . . . . . . . . — (702) — (702)
Fee and other income (expense) . . . . . . . . . . . . . . . . . . . . . 219 204 (19) 404
Non-interest income (loss) . . . . . . . . . . . . . . . . . . . . . . . . 4,596 (117) (13,943) (9,464)
Provision for credit losses . . . . . . . . . . . . . . . . . . . . . . . . . . 312 40 — 352
Restatement and related regulatory expenses . . . . . . . . . . . . . 92 36 272 400
Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 925 355 586 1,866
Income (loss) before federal income taxes and
extraordinary losses. . . . . . . . . . . . . . . . . . . . . . . . . . . 3,719 (674) 2,954 5,999
Provision (benefit) for federal income taxes . . . . . . . . . . . . . 1,323 (1,099) 800 1,024
Income before extraordinary losses . . . . . . . . . . . . . . . . . . 2,396 425 2,154 4,975
Extraordinary losses, net of tax effect. . . . . . . . . . . . . . . . . . — — (8) (8)
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,396 $ 425 $ 2,146 $ 4,967
(1)
Includes cost of capital charge.
(2)
Includes intercompany guaranty fee income (expense) allocated to Single-Family and HCD from Capital Markets for
absorbing the credit risk on mortgage loans held in our portfolio.
(3)
Reclassified from guaranty fee income to conform to current year presentation.
The following table displays total assets by segment as of December 31, 2006 and 2005.
2006 2005
As of December 31,
(Dollars in millions)
Single-Family . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 15,777 $ 14,450
HCD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,100 12,075
Capital Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 814,059 807,643
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $843,936 $834,168
We operate our business solely in the United States and, accordingly, we do not generate any revenue from or
have assets in geographic locations other than the United States.
16. Regulatory Capital Requirements
The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (the “1992 Act”) established
minimum capital, critical capital and risk-based capital requirements for Fannie Mae. Based upon these
requirements, OFHEO classifies us on a quarterly basis as either adequately capitalized, undercapitalized,
significantly undercapitalized or critically undercapitalized. We are required by federal statute to meet the
minimum, critical and risk-based capital standards to be classified as adequately capitalized.
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FANNIE MAE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)