Fannie Mae 2013 Annual Report Download - page 106

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term debt in “Liquidity and Capital Management—Liquidity Management—Debt Funding.” Also see “Note 8, Short-Term
Borrowings and Long-Term Debt” for additional information on our outstanding debt.
The decrease in debt of Fannie Mae in 2013 was primarily driven by lower funding needs, as our retained mortgage portfolio
decreased. The increase in the balance of debt of consolidated trusts as of December 31, 2013 compared with the balance as
of December 31, 2012 was primarily driven by securitization activity from our lender swap and portfolio securitization
programs and sales of Fannie Mae MBS, which are accounted for as reissuances of debt of consolidated trusts in our
consolidated balance sheets, since the MBS certificate ownership is transferred from us to a third party.
Stockholders’ Equity
Our net equity increased as of December 31, 2013 compared with December 31, 2012. See “Table 27: Comparative Measures
—GAAP Change in Stockholders’ Equity and Non-GAAP Change in Fair Value of Net Assets (Net of Tax Effect)” for details
of the change in our net equity.
SUPPLEMENTAL NON-GAAP INFORMATION—FAIR VALUE BALANCE SHEETS
As part of our disclosure requirements with FHFA, we disclose on a quarterly basis supplemental non-GAAP consolidated
fair value balance sheets, which reflect our assets and liabilities at estimated fair value.
Table 27 summarizes changes in our stockholders’ equity reported in our GAAP consolidated balance sheets and in the
estimated fair value of our net assets in our non-GAAP consolidated fair value balance sheets for the year ended
December 31, 2013. The estimated fair value of our net assets is calculated based on the difference between the fair value of
our assets and the fair value of our liabilities, adjusted for noncontrolling interests. We use various valuation techniques to
estimate fair value, some of which incorporate internal assumptions that are subjective and involve a high degree of
management judgment. We describe the specific valuation techniques used to determine fair value and disclose the carrying
value and fair value of our financial assets and liabilities in “Note 18, Fair Value.”
Table 27: Comparative Measures—GAAP Change in Stockholders’ Equity and Non-GAAP Change in Fair Value of
Net Assets (Net of Tax Effect)
For Year Ended
December 31, 2013
(Dollars in millions)
GAAP consolidated balance sheets:
Fannie Mae stockholders’ equity as of December 31, 2012(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,183
Total comprehensive income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84,801
Senior preferred stock dividends paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (82,452)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Fannie Mae stockholders’ equity as of December 31, 2013(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,541
Non-GAAP consolidated fair value balance sheets:
Estimated fair value of net assets as of December 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(66,492)
Senior preferred stock dividends paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (82,452)
Senior preferred stock dividends payable(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,191)
Increase in deferred tax assets, net(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,560
Change in estimated fair value of net assets excluding senior preferred stock dividends paid, senior
preferred stock dividends payable and the increase in net deferred tax assets . . . . . . . . . . . . . . . . . . . . . . 75,207
Increase in estimated fair value of net assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,124
Estimated fair value of net assets as of December 31, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(33,368)
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(1) Our net worth, as defined under the senior preferred stock purchase agreement, is equivalent to the “Total equity” amount reported in
our consolidated balance sheets, which consists of “Total Fannie Mae stockholders’ equity” and “Noncontrolling interest.”
(2) Represents the dividend payment we will pay Treasury in the first quarter of 2014 under the senior preferred stock purchase agreement,
which, for purposes of our non-GAAP fair value balance sheets, we present as a liability. Under the terms of the senior preferred stock