8-K: Fannie Mae Reports $14.4B Profit in 2025, Net Worth Hits Record $109B

Fannie Mae announced net income of $3.5 billion for Q4 2025 and $14.4 billion for the full year, with net worth reaching a record $109.0 billion.

Summary

• Net income for the fourth quarter of 2025 was $3.5 billion, a decrease from $3.9 billion in the third quarter of 2025.
• Full-year 2025 net income decreased by $2.6 billion to $14.4 billion, down 15% from $17.0 billion in 2024.
• Net worth grew to a record $109.0 billion as of December 31, 2025, an increase of $14.4 billion from year-end 2024 and $95.5 billion since the start of 2020.
• Net revenues remained stable at $7.3 billion for the fourth quarter and $29.0 billion for the full year.
• A $1.606 billion provision for credit losses was recorded in 2025, a significant shift from a $186 million benefit in 2024.
• Fair value gains decreased by $1.7 billion in 2025, contributing to the decline in net income.
• Non-interest expenses were reduced by $141 million from 2024, including a $40 million reduction in administrative expenses.
• The company enabled the financing of approximately 1.5 million home purchases, refinances, and rental units in 2025, providing $409 billion in liquidity to the mortgage market.
• First-time homebuyers accounted for more than half of single-family purchase mortgages, and over 80% of multifamily units financed were for renters earning less than 100% of area median income.
• Foreclosure prevention solutions allowed nearly 99,000 homeowners to remain in their homes.
• The single-family serious delinquency rate increased to 0.58% as of December 31, 2025, from 0.54% in the prior quarter.
• The multifamily serious delinquency rate increased to 0.74% as of December 31, 2025, from 0.68% in the prior quarter.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a moderately positive report, primarily driven by record net worth and effective cost management, but tempered by a significant decline in full-year net income and increasing delinquency rates.

Positives

• Net worth reached a record $109.0 billion at the end of 2025, demonstrating a stronger financial footing.
• Achieved 14 straight years of annual profitability, reflecting effective long-term risk management and mission focus.
• Annual administrative expenses were reduced by $40 million from 2024, marking the first reduction in four years.
• Total non-interest expenses decreased by $141 million from 2024, indicating enhanced operational effectiveness and cost reduction efforts.
• Strong mission performance, including enabling financing for ~1.5 million households and providing $409 billion in mortgage market liquidity.
• Multifamily acquisition volume totaled $73.7 billion in 2025, the highest in five years, driven by strong demand for affordable rental housing.
• Single-family conventional acquisition volume rose to $96.8 billion in Q4 2025, up from $90.4 billion in Q3 2025, primarily due to increased refinance activity.
• Credit characteristics of the single-family conventional guaranty book remained largely unchanged, with a weighted-average FICO score of 753 and a mark-to-market LTV of 51%.

Negatives

• Full-year 2025 net income decreased by $2.6 billion (15%) to $14.4 billion compared to $17.0 billion in 2024.
• Net income for Q4 2025 decreased to $3.5 billion from $3.9 billion in Q3 2025.
• A significant shift occurred from a $186 million benefit for credit losses in 2024 to a $1.606 billion provision for credit losses in 2025.
• A $1.7 billion decrease in fair value gains in 2025 negatively impacted net income.
• Single-family serious delinquency rate increased to 0.58% as of December 31, 2025, from 0.54% in the prior quarter.
• Multifamily serious delinquency rate increased to 0.74% as of December 31, 2025, from 0.68% in the prior quarter.
• Single-family purchase acquisition volume decreased by $12.8 billion in Q4 2025, partially offsetting refinance gains.
• Risk-weighted assets (RWA) and risk density increased quarter-over-quarter, reflecting higher credit risk weights on new acquisitions and reduced capital relief from credit risk transfer.

Risks

• Forward-looking statements are subject to material differences due to a variety of factors, including those described in 'Forward-Looking Statements and Risk Factors' in the company's 2025 Form 10-K.
• Increased delinquencies in both single-family and multifamily segments pose a potential threat to credit performance.
• Higher credit risk weights on new acquisitions could impact future capital requirements.
• Reduced capital relief from credit risk transfer mechanisms may increase retained risk.
• Continued affordability challenges in the housing market could constrain future business volume and credit quality.

Future Outlook

Management expects expense reduction efforts, including a 15% workforce reduction, to deliver multiyear savings and sustain a smaller cost footprint. The company plans to remain focused on making the mortgage process more efficient and less costly for lenders and borrowers in 2026. Fannie Mae also anticipates continued growth in its multifamily book of business in 2026, driven by strong demand for affordable rental housing, and expresses strong momentum going into 2026 and beyond.

Management Comments

• William J. Pulte, Director, U.S. Federal Housing, and Chairman, Fannie Mae Board of Directors: "Fannie Mae's financial footing is stronger than ever, hitting a record level $109 billion net worth. For the first time in four years we reduced annual administrative expenses, positioning the company for long-term success. This growing strength enables Fannie Mae to power the American Dream for families across the United States today and into the future."
• Peter Akwaboah, Acting Chief Executive Officer and Chief Operating Officer, Fannie Mae: "Fannie Mae's 14 straight years of annual profitability reflect the strength of our business, the dedication of our employees, and the partnership of the institutions we serve. We grew our net worth to $109 billion and have strong momentum going into 2026 and beyond."
• Chryssa C. Halley, Chief Financial Officer, Fannie Mae: "We generated $3.5 billion in net income in the fourth quarter and $14.4 billion for the year, supported by steady revenues of $7.3 billion and $29.0 billion, respectively. We are well positioned to continue to meet the needs of the housing market while operating in a safe and sound manner."
• Jake Williamson, EVP, Head of Single-Family, Fannie Mae: "Single-Family business acquisitions rose in the fourth quarter as more homeowners chose to refinance. In 2026, we will remain focused on serving our customers with ways to make the mortgage process more efficient and less costly for both lenders and borrowers."
• Kelly Follain, EVP, Head of Multifamily, Fannie Mae: "The pace of acquisitions accelerated in the fourth quarter, capping a year of extraordinary growth in Multifamily. We're seeing strong demand for affordable rental housing, and we look forward to continuing to grow our book of business in 2026."

Industry Context

StockSavvy.ai notes that Fannie Mae's performance reflects a mixed housing market. While refinance activity picked up in Q4 2025 due to declining mortgage rates, purchase volumes decreased, indicating ongoing affordability challenges. The strong demand for affordable rental housing, as evidenced by Fannie Mae's multifamily growth, aligns with broader demographic and economic trends favoring rental markets. The increase in delinquency rates, though slight, warrants attention as it could signal broader stress in the mortgage market, contrasting with the overall positive sentiment from management.

Comparison to Industry Standards

• Fannie Mae's 14 consecutive years of profitability demonstrate robust risk management, a notable achievement in the often-volatile housing finance sector, potentially outperforming some private sector mortgage originators and servicers over this extended period.
• The increase in single-family serious delinquency rate to 0.58% and multifamily to 0.74% should be monitored against industry averages for mortgage servicers and Government-Sponsored Enterprises (GSEs). These rates remain significantly below the peaks observed during the 2008 financial crisis, suggesting a relatively stable, albeit slightly deteriorating, credit environment compared to historical stress periods.
• The weighted-average FICO score of 753 and mark-to-market LTV of 51% for single-family acquisitions indicate a continued focus on high-quality borrowers, generally exceeding the average FICO scores for conventional loans in the broader market (which often range in the low 700s).
• Multifamily acquisition volume of $73.7 billion, the highest in five years, suggests Fannie Mae is effectively capitalizing on strong demand for affordable rental housing, potentially outpacing some private sector lenders in this specific market segment.

Stakeholder Impact

• Shareholders: Mixed impact. Record net worth is positive, but decreased net income and increasing credit loss provisions could be a concern. Common stockholders' earnings per share remain $0.00 due to conservatorship.
• Homeowners/Borrowers: Positive impact through continued financing of ~1.5 million homes, focus on first-time homebuyers, and foreclosure prevention solutions for nearly 99,000 homeowners. Efforts to make the mortgage process more efficient and less costly are beneficial.
• Renters: Positive impact, with over 80% of multifamily units financed for renters earning less than 100% of area median income, addressing affordable housing needs.
• Lenders: Liquidity provided to the mortgage market ($409 billion) supports lender operations. Focus on making the mortgage process more efficient and less costly for lenders.
• Employees: Workforce reduction of approximately 1,200 employees (15% of workforce) indicates a negative impact for those affected, though it is part of cost reduction efforts.

Next Steps

• Continue to meet the needs of the housing market while operating in a safe and sound manner.
• Remain focused on serving customers with ways to make the mortgage process more efficient and less costly for both lenders and borrowers in 2026.
• Continue to grow the multifamily book of business in 2026.
• Expense reduction efforts are expected to deliver multiyear savings and sustain a smaller cost footprint.

Key Dates

Keywords

Fannie Mae, FNMA, financial results, net income, net worth, mortgage, housing finance, credit losses, administrative expenses, single-family, multifamily, delinquency rates, SEC filing, 10-K, Q4 2025, 2025