Mae and Freddie Mac, the two major U.S. mortgage-finance companies,
had seen improvements in earnings and foreclosure prevention, they
are still in face of mixed challenges, the U.S. Federal Housing
Finance Agency (FHFA) said on Wednesday.
Both Fannie Mae and Freddie Mac guaranteed around $100 billion per month in new mortgages in 2011, accounting for three of every four mortgages originated last year, the FHFA said in its fourth annual Report to the U.S Congress, detailing the agency's examinations of Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks (FHLBanks).
Since the first quarter of conservatorship in September 2008, more than 2.1 million foreclosures had been prevented by Fannie Mae and Freddie Mac loans, said the regulator of these two companies.
Despite the improvements, Fannie Mae and Freddie Mac are still facing challenges including ongoing stress in housing markets, difficult economic environment, and uncertain future, the report noted.
As of year-end 2011, the two companies had sought aid of $187.5 billion in total from the U.S. government, and they were also considered by the FHFA as "critical supervisory concerns" for 2011.
Continuing credit losses at Fannie Mae and Freddie Mac came primarily from loans originated during the years 2005 to 2007, the report said.
With respect to FHLBanks in 2011, their financial condition and performance remained fairly stable, though several banks continued to be negatively affected by their exposure to private-label mortgage-backed securities, the FHFA added.
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