Fannie Mae 2010 Annual Report Download - page 331

trust management income earned by consolidated trusts as a component of net interest income in our
consolidated statements of operations. We recognized no servicing income for non-consolidated trusts in 2010.
Trust management income of $40 million and $261 million relating to non-consolidated trusts for the years
ended December 31, 2009 and 2008, respectively, has been reclassified as a component of “Fee and other
income” in our consolidated statements of operations.
8. Acquired Property, Net
Acquired property, net consists of held-for-sale foreclosed property received in full satisfaction of a loan net of
a valuation allowance for declines in the fair value of foreclosed properties after initial acquisition. We classify
as held for sale those properties that we intend to sell and are actively marketed for sale. The following table
displays the activity in acquired property and the related valuation allowance for the years ended
December 31, 2010, 2009 and 2008.
Acquired
Property
Valuation
Allowance
(1)
Acquired
Property, Net
(Dollars in millions)
Balance, January 1, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,853 $ (251) $ 3,602
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,853 (75) 10,778
Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,666) 664 (6,002)
Write-downs, net of recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (1,460) (1,460)
Balance, December 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,040 (1,122) 6,918
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,165 (79) 14,086
Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (12,489) 1,379 (11,110)
Write-downs, net of recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (752) (752)
Balance, December 31, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,716 (574) 9,142
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,982 (783) 25,199
Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (17,644) 1,407 (16,237)
Write-downs, net of recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (1,931) (1,931)
Balance, December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 18,054 $(1,881) $ 16,173
(1)
Reflects activities in the valuation allowance for acquired properties held primarily by our single-family segment.
We classify as held for use those properties that we do not intend to sell or that are not ready for immediate
sale in their current condition and are reflected in “Other assets” in our consolidated balance sheets. The
following table displays the activity and carrying amount of acquired properties held for use for the years
ended December 31, 2010, 2009 and 2008. The increase in held for use property is primarily from renting
properties rather than actively marketing them.
2010 2009 2008
For the Year Ended
December 31,
(Dollars in millions)
Beginning balance, January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 44 $ 11 $107
Transfers in from held for sale, net and additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 977 45 1
Transfers to held for sale, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (64) (11) (93)
Depreciation and asset write-downs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (68) (1) (4)
Ending balance, December 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $889 $ 44 $ 11
F-73
FANNIE MAE
(In conservatorship)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)