Fannie Mae-No Politics (FNMA)

[kthomp19]

All I see for core capital is (114,526), or negative ~$114.5B, on page F-57. It is the sum of

Common stock, 687
Treasury stock, (7,401)
(Junior) Preferred stock, 19,130
Accumulated deficit, (126,942)

and retained earnings, but that's zero.

The $25B figure you're quoting is the minimum statutory core capital requirement.

If the government decides to cancel the senior preferreds as part of a settlement, I assume that the 117,149 number on the balance sheet would disappear, and the offsetting ammount would go towards the accumulated deficit, which would turn into retained earnings of 2,623. This is only $2.6B, not nearly enough to capitalize the company, but it is a necessary start.


It still seems to me that a conversion from junior preferred to common would reduce core capital, unless I have the common's stated value part wrong. The value per share on the balance sheet is around $0.59, but most balance sheets I see have stated values of $0.01, $0.001, etc.