Fannie Mae 2013 Annual Report Download - page 289

FANNIE MAE
(In conservatorship)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
F-65
For the Year Ended December 31, 2011
Business Segments Other Activity/Reconciling Items
Single-
Family Multifamily Capital Markets Consolidated Trusts(1) Eliminations/ Adjustments(2) Total Results
(Dollars in millions)
Net interest (loss) income . . . . . . . $ (2,411) $ (38) $ 13,920 $ 5,765 $ 2,045 (3) $ 19,281
Provision for credit losses. . . . . . . (26,453) (265) — — — (26,718)
Net interest (loss) income after
provision for credit losses . . . . . (28,864) (303) 13,920 5,765 2,045 (7,437)
Guaranty fee income (expense). . . 7,507 884 (1,497)(4,486)(5) (2,181)(5) 227 (5)
Investment (losses) gains, net . . . . (2) 18 3,711 (315)(2,906)(6) 506
Net other-than-temporary
impairments. . . . . . . . . . . . . . . . — — (306)(2) — (308)
Fair value losses, net. . . . . . . . . . . (7) — (6,596)(226) 208 (7) (6,621)
Debt extinguishment (losses)
gains, net . . . . . . . . . . . . . . . . . . — — (254) 22 — (232)
Gains from partnership
investments(8) . . . . . . . . . . . . . . . — 81 — — — 81
Fee and other income (expense) . . 579 218 478 (329)(10) 936
Administrative expenses . . . . . . . . (1,638) (264) (468) — — (2,370)
Foreclosed property expense. . . . . (765) (15) — — — (780)
Other (expenses) income. . . . . . . . (857) 25 (34) — (81)(947)
(Loss) income before federal
income taxes . . . . . . . . . . . . . . . (24,047) 644 8,954 429 (2,925)(16,945)
Benefit (provision) for federal
income taxes . . . . . . . . . . . . . . . 106 (61) 45 — — 90
Net (loss) income attributable
to Fannie Mae . . . . . . . . . . . $ (23,941) $ 583 $ 8,999 $ 429 $ (2,925) $ (16,855)
__________
(1) Represents activity related to the assets and liabilities of consolidated trusts in our consolidated balance sheets.
(2) Represents the elimination of intercompany transactions occurring between the three business segments and our consolidated trusts, as
well as other adjustments to reconcile to our consolidated results.
(3) Represents the amortization expense of cost basis adjustments on securities in the Capital Markets group’s retained mortgage portfolio
that on a GAAP basis are eliminated.
(4) Pursuant to the TCCA, effective April 1, 2012, we increased the guaranty fee on all single-family residential mortgages delivered to us
on or after that date by 10 basis points, and the incremental revenue must be remitted to Treasury. The resulting revenue is included in
guaranty fee income and the expense is recognized as “TCCA fees.” This increase in guaranty fee is also included in the single-family
average charged guaranty fee.
(5) Represents the guaranty fees paid from consolidated trusts to the Single-Family and Multifamily segments. The adjustment to guaranty
fee income in the Eliminations/Adjustments column represents the elimination of the amortization of deferred cash fees related to
consolidated trusts that were re-established for segment reporting. Total guaranty fee income related to unconsolidated Fannie Mae
MBS trusts and other credit enhancement arrangements is included in fee and other income in our consolidated statements of operations
and comprehensive income (loss).
(6) Primarily represents the removal of realized gains and losses on sales of Fannie Mae MBS classified as available-for-sale securities that
are issued by consolidated trusts and in the Capital Markets group’s retained mortgage portfolio. The adjustment also includes the
removal of securitization gains (losses) recognized in the Capital Markets segment relating to portfolio securitization transactions that
do not qualify for sale accounting under GAAP.
(7) Represents the removal of fair value adjustments on consolidated Fannie Mae MBS classified as trading that are in the Capital Markets
group’s retained mortgage portfolio.
(8) Gains from partnership investments are included in other expenses in our consolidated statements of operations and comprehensive
income (loss).
(9) Primarily represents the release of the valuation allowance for our deferred tax assets that generally are directly attributable to each
segment based on the nature of the item.
(10) Represents the adjustment from equity method accounting to consolidation accounting for partnership investments that are consolidated
in our consolidated balance sheets.