Fannie Mae — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net income for the third quarter of 2026 was $4.2 billion, an increase from $4.0 billion in the second quarter of 2026 and $3.9 billion in the third quarter of 2025.
• Net revenues increased to $7.7 billion in the third quarter of 2026, up from $7.6 billion in the second quarter of 2026 and $7.3 billion in the third quarter of 2025.
• Net interest income was $7.6 billion for the quarter, up 1% from the second quarter and 5% from the prior year period.
• Provision for credit losses totaled $1.1 billion for the quarter, compared to $485 million in the second quarter of 2026 and $338 million in the third quarter of 2025.
• Non-interest expense increased to $2.1 billion in the third quarter of 2026, compared to $2.1 billion in the second quarter and $2.3 billion in the third quarter of 2025.
• Other gains totaled $724 million, driven primarily by net fair value gains, compared to a net loss of $23 million in the second quarter.
• Other comprehensive losses increased by $885 million, driven by unrealized losses on available-for-sale securities.
• Net worth reached $119.6 billion as of September 30, 2026, up 3% from the second quarter and 13% from the third quarter of 2025.
• The illustrative return on average required CET1 capital increased to 11.1% in the third quarter of 2026, up from 10.8% in the second quarter.
• Administrative expense ratio was 10.25% in the third quarter of 2026, compared to 10.72% in the second quarter.
• Guaranty book of business stood at $4.1 trillion as of September 30, 2026, unchanged from the second quarter.

Guidance and Future Outlook:

• No specific forward financial guidance or quantitative future outlook was provided in the press release.
• Management stated a continued focus on running an efficient business and reducing mortgage costs.
• The company emphasized its ability to deliver reliable liquidity in all market conditions.

Business Segments and Product Lines:

• Single-Family:
  • Net revenues were $6.3 billion, largely unchanged from the second quarter.
  • Conventional acquisition volume decreased to $88.3 billion in the third quarter, compared to $111.2 billion in the second quarter.
  • Average single-family conventional guaranty book was $3.56 trillion, largely unchanged from the prior quarter.
  • Provision for single-family credit losses was $694 million, up from $226 million in the second quarter, driven by higher actual and projected interest rates, newly acquired loans, and newly delinquent loans.
  • Average charged guaranty fee on the single-family conventional guaranty book increased to 49.1 basis points, net of TCCA fees.
  • Single-family serious delinquency rate increased to 0.62% as of September 30, 2026.
• Multifamily:
  • Net revenues increased to $1.32 billion in the third quarter, up from $1.26 billion in the second quarter.
  • Acquisition volume increased to $14.5 billion in the third quarter, compared to $14.2 billion in the second quarter.
  • Guaranty book of business grew to $545.4 billion as of September 30, 2026.
  • Provision for multifamily credit losses was $446 million, up from $259 million in the second quarter, reflecting weakening credit metrics, a decline in near-term property value forecasts, and elevated interest rates.
  • Average charged guaranty fee on the multifamily book decreased to 69.9 basis points as of September 30, 2026.
  • Multifamily serious delinquency rate increased to 0.62% as of September 30, 2026.

Market and Competitive Landscape:

• Fannie Mae provided $103 billion in liquidity in the third quarter of 2026, supporting approximately 194,000 home purchases, 66,000 refinancings, and 96,000 rental units.
• The company enabled the financing of approximately 356,000 home purchases, refinancings, and rental units in the quarter.
• Nearly 103,000 first-time homebuyers were financed, representing 53% of single-family purchase acquisitions.
• 47% of single-family loans acquired went to low- and middle-income borrowers earning no more than 100% of area median income.
• 77% of multifamily units financed were affordable to renters earning no more than 100% of area median income.
• The company expanded the use of VantageScore 4.0 to promote greater choice and access to homeownership.
• Foreclosure prevention solutions allowed more than 21,000 homeowners to remain in their homes.

Risks and Challenges:

• Credit loss provisions increased due to higher actual and projected interest rates, newly acquired loans, and newly delinquent loans in the single-family segment.
• Multifamily credit loss provisions increased due to weakening credit metrics, a decline in near-term property value forecasts, and elevated interest rates.
• Unrealized losses on available-for-sale securities drove an increase in other comprehensive losses.
• The company noted that actual outcomes could be materially different from forward-looking statements due to various factors described in its Form 10-Q and Form 10-K.

Management Commentary and Tone:

• William J. Pulte, Chairman of the Board, described the performance as "strong," noting a 13% year-over-year growth in net worth and a focus on reducing mortgage costs.
• Peter Akwaboah, Acting CEO and COO, highlighted that the company has provided $344 billion of liquidity year-to-date 2026, helping over 295,000 first-time homeowners.
• Chryssa C. Halley, CFO, stated that continued profitability underscores the stability of the guaranty fee-driven business model and the strength of the balance sheet.
• Jake Williamson, Head of Single-Family, emphasized deepening relationships with lenders and pairing credit score modernization with sound risk management.
• Kelly Follain, Head of Multifamily, cited disciplined execution and the combination of the DUS model with innovative financing and technology solutions.

Other Key Points:

• As of September 30, 2026, the company's actual available Common Equity Tier 1 (CET1) capital was a deficit of $30 billion.
• The company is currently in conservatorship.
• The company filed its Third Quarter 2026 Form 10-Q with the Securities and Exchange Commission.
• During the third quarter of 2026, the company changed its methodology for allocating certain fair value gains and losses between its two business segments.
• Total assets were $4.32 trillion as of September 30, 2026, compared to $4.32 trillion as of December 31, 2025.
• Total liabilities were $4.20 trillion as of September 30, 2026.
• Senior preferred stock liquidation preference was $237,996 million as of September 30, 2026.