Fannie Mae delinquencies jump, Aug portfolio flat

NEW YORK Tue Sep 29, 2009 6:41pm EDT

The headquarters of mortgage lender Fannie Mae is shown in Washington September 8, 2008. REUTERS/Jason Reed

The headquarters of mortgage lender Fannie Mae is shown in Washington September 8, 2008.

Credit: Reuters/Jason Reed

NEW YORK (Reuters) - Fannie Mae, the largest provider of funding for U.S. home mortgages, said on Tuesday that delinquencies on loans it guarantees accelerated as its August mortgage investment portfolio was unchanged from the previous month.

Delinquency on loans in its single-family guarantee business jumped by 0.23 percentage point to 4.17 percent in July, the most recent data available. A year earlier it was 1.45 percent.

The multifamily delinquency rate also rose, up 0.05 percentage point to 0.56 percent in July. A year earlier it was 0.13 percent.

The mortgage investment portfolio was at $779.4 billion, for an annualized 1.5 percent decrease year to date, the Washington D.C.-based company said in its monthly summary.

In August 2008, the portfolio was $759.98 billion.

The company's total mortgage portfolio increased at a 5.8 percent annualized rate in August to $3.229 trillion.

Fannie Mae FNM.P FNM.N said it provided $69.0 billion in liquidity to the market through net retained commitments of $6.9 billion and $62.1 billion in mortgage-backed securities issuances.

Fannie Mae mortgage-backed securities and other guarantees grew at a compound annualized rate of 4.1 percent during the month, while issuance of mortgage-backed securities decreased to $62.1 billion from $79.7 billion the previous month.

Liquidations decreased to $52.5 billion, the company said.

In early September 2008, the U.S. government seized control of Fannie Mae and its smaller sibling, Freddie Mac FRE.P FRE.N, amid heightened worries about shrinking capital at the congressionally chartered companies.

The current agreement with the U.S. Treasury caps the retained portfolio at Fannie Mae and Freddie Mac at $900 billion until December 31, 2009, when they are to start declining by 10 percent per year until they reach $250 billion.

The government has been relying heavily on Fannie Mae and Freddie Mac in its efforts to stimulate the U.S. housing market by buying more mortgage loans, easing refinancing and helping homeowners avoid foreclosure.

(Reporting by Julie Haviv; Editing by Padraic Cassidy)

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