Multifamily Business Highlights
- Multifamily's net income was $1.9 billion in fiscal year 2020 and $626 million in the fourth quarter of 2020, compared to $2.3 billion in fiscal year 2019 and $547 million in the fourth quarter of 2019.
- Multifamily revenue for 2020 was driven by $3.4 billion in net interest income. Over 75% of our multifamily net interest income in 2020 was derived from guaranty fee income, which continued to provide a stable driver of earnings for the business. The multifamily guaranty book of business increased by $46 billion in 2020 to $385 billion.
- Multifamily credit-related expenses of $623 million in 2020 were primarily driven by an increase in our allowance due to losses we expect to incur mainly as a result of the COVID-19 pandemic.
- Working with our DUS Partners, Fannie Mae’s new multifamily business volume was $76.0 billion in 2020, the highest volume on record. Multifamily remained under the $100 billion FHFA cap with $94.1 billion in volume for the five-quarter period ending December 31, 2020, while meeting its goal of acquiring at least 37.5% of its business volume in mission-driven housing, as defined by FHFA. Multifamily provided liquidity for 792,000 units of multifamily housing in 2020, with over 90% of those units affordable to families earning at or below 120% of the area median income, providing support for both affordable and workforce housing.
- Since the COVID-19 pandemic was declared a national emergency in March 2020, we have offered forbearance to affected multifamily borrowers. We estimate that, through December 2020, approximately 1.5% of our multifamily book of business as of March 31, 2020, based on unpaid principal balance, has been in a COVID-19-related forbearance at some point in time. Over 60% of those loans, measured by unpaid principal balance, are currently in a repayment plan or reinstated as of December 31, 2020, and 0.4% of the book, or $1.7 billion in loans, was still in an active forbearance.
- Our multifamily serious delinquency rate increased to 0.98% as of December 31, 2020, compared with 0.04% as of December 31, 2019, due to the economic dislocation caused by the COVID-19 pandemic, which increased borrower participation in forbearance plans. While higher year over year, the serious delinquency rate was down quarter-over-quarter, from 1.12% as of September 30, 2020, driven by loans exiting forbearance plans and performing under repayment agreements. Our multifamily serious delinquency rate, excluding loans that received a forbearance, was 0.03% as of December 31, 2020. Our multifamily serious delinquency rate consists of multifamily loans that were 60 days or more past due based on unpaid principal balance, expressed as a percentage of our multifamily guaranty book of business.
- Fannie Mae reported annual net income of $11.8 billion for fiscal year 2020 compared with net income of $14.2 billion for 2019. Net income decreased $2.4 billion compared with 2019, primarily driven by a shift from credit-related income to credit-related expenses, due to economic dislocation caused by the COVID-19 pandemic and lower redesignation activity, as well as a reduction in investment gains driven by a decrease in the volume of single-family reperforming loans sales. This was partially offset by an increase in net revenues driven by near-record levels of refinancing activity in 2020.
- Fannie Mae’s net worth increased to $25.3 billion as of December 31, 2020. Our senior preferred stock purchase agreement with Treasury was amended in January 2021, allowing Fannie Mae to continue to retain earnings while the company builds capital.
- Fannie Mae continues to provide economic relief to borrowers impacted by COVID-19 through its forbearance program. As of December 31, 2020, 3.0% of Fannie Mae’s single-family guaranty book of business based on loan count and 0.4% of the company’s multifamily guaranty book of business based on unpaid principal balance were in forbearance, the vast majority of which were related to COVID-19.
- Fannie Mae provided $1.4 trillion in liquidity to the mortgage market in 2020, helping borrowers and renters across the country to own or rent a home through the financing of approximately 5.7 million home purchases, refinancings, and rental units.
More information is available here: