Bank analysts warn another crisis is in store for Fannie Mae and Freddie Mac, which potentially means another bailout.
Fannie and Freddie’s earnings are now dropping after a surprisingly profitable 2013. Fannie Mae’s net income fell 83% in 2014 to $14.21 billion, while Freddie Mac’s fell 84% to $7.69 billion, SNL Financial notes. In the first quarter of 2015, Fannie reported only $1.89 billion in net income while Freddie posted $524 million, the bank research shop says.
Brad Bracey and Matt MacFarland at SNL Financial warn: “Some believe the institutions are now exposed to another downturn in the housing market.”
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