Fannie Mae 2006 Annual Report Download - page 322

Quarterly Statements of Income
The following table displays our unaudited interim consolidated statements of income for the quarters ended
March 31, 2006, June 30, 2006, September 30, 2006 and December 31, 2006.
March 31 June 30 September 30 December 31
For the 2006 Quarter Ended
(Dollars and shares in millions,
except per share amounts)
Interest income:
Investments in securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,422 $ 5,791 $ 5,976 $ 5,634
Mortgage loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,082 5,204 5,209 5,309
Total interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,504 10,995 11,185 10,943
Interest expense:
Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,650 1,907 2,124 2,055
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,842 7,221 7,533 7,543
Total interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,492 9,128 9,657 9,598
Net interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,012 1,867 1,528 1,345
Guaranty fee income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 930 917 1,063 1,264
Losses on certain guaranty contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . (27) (51) (103) (258)
Investment gains (losses), net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (675) (633) 550 75
Derivatives fair value gains (losses), net . . . . . . . . . . . . . . . . . . . . . . . . . 906 1,621 (3,381) (668)
Debt extinguishment gains, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 69 72 43
Losses from partnership investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . (194) (188) (197) (286)
Fee and other income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308 62 255 234
Non-interest income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,265 1,797 (1,741) 404
Administrative expenses:
Salaries and employee benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265 311 307 336
Professional services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 347 362 333 351
Occupancy expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 67 64 71
Other administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 40 57 69
Total administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 708 780 761 827
Minority interest in earnings (losses) of consolidated subsidiaries . . . . . . . . 2 3 2 3
Provision for credit losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 144 145 221
Foreclosed property expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 14 52 105
Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 61 99 204
Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 843 1,002 1,059 1,360
Income (loss) before federal income taxes and extraordinary gains (losses) . . . . 2,434 2,662 (1,272) 389
Provision for federal income tax expense (benefit) . . . . . . . . . . . . . . . . . . 409 610 (639) (214)
Income (loss) before extraordinary gains (losses) . . . . . . . . . . . . . . . . . . . 2,025 2,052 (633) 603
Extraordinary gains (losses), net of tax effect . . . . . . . . . . . . . . . . . . . . . . 1 6 4 1
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,026 $ 2,058 $ (629) $ 604
Preferred stock dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (122) (127) (131) (131)
Net income (loss) available to common stockholders . . . . . . . . . . . . . . . . . $ 1,904 $ 1,931 $ (760) $ 473
Basic earnings (loss) per share:
Earnings (losses) before extraordinary gains (losses) . . . . . . . . . . . . . . . $ 1.96 $ 1.98 $ (0.79) $ 0.49
Extraordinary gains (losses), net of tax effect . . . . . . . . . . . . . . . . . . . . — 0.01 — —
Basic earnings (loss) per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1.96 $ 1.99 $ (0.79) $ 0.49
Diluted earnings (loss) per share:
Earnings (losses) before extraordinary gains (losses) . . . . . . . . . . . . . . . $ 1.94 $ 1.96 $ (0.79) $ 0.49
Extraordinary gains (losses), net of tax effect . . . . . . . . . . . . . . . . . . . . — 0.01 — —
Diluted earnings (loss) per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1.94 $ 1.97 $ (0.79) $ 0.49
Cash dividends per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.26 0.26 0.26 0.40
Weighted-average common shares outstanding:
Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 971 971 972 972
Diluted
(1)
............................................ 998 999 972 974
(1)
For the quarters ended September 30, 2006 and December 31, 2006, diluted shares outstanding exclude the effect of
our convertible preferred stock as inclusion would be anti-dilutive for the periods.
F-91
FANNIE MAE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)