Billionaire Boys Club Member Forum (BBCMF)

[mick]

FNM , FRE ,,, Fannie Mae to Miss Deadline for 1Q Report
Wednesday May 11, 8:14 pm ET
Fannie Mae to Miss Deadline for First-Quarter Report Amid Reworking of Its Accounting


WASHINGTON (AP) -- Embattled mortgage company Fannie Mae said Wednesday that it is again missing a regulatory deadline for filing a financial report, this time for the first quarter, because of the reworking of its accounting amid an investigation by federal regulators.
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The government-sponsored company, which finances one of every five home loans in the United States, still hasn't filed its third-quarter or annual report for 2004 with the Securities and Exchange Commission, and has said it is unable to provide "a reasonable estimate" of its earnings for 2003 and 2004.

In addition, Fannie Mae said Wednesday that it cannot provide a reasonable estimate of its financial results for January-March of this year. The company disclosed that its administrative expenses for the quarter, which include the costs of the massive accounting review, rose to an estimated $440 million from $383 million, the estimate for the first quarter of 2004.

Federal regulators accused Fannie Mae last fall of serious accounting problems and earnings manipulation to meet Wall Street targets, and the SEC in December ordered the company to restate earnings back to 2001 -- a correction that could reach an estimated $11 billion. The Justice Department is pursuing a criminal investigation.

Companies that miss SEC quarterly and annual filing deadlines are technically in violation of agency rules. The SEC rarely imposes sanctions, however, because investors would not benefit from companies with restatements under way putting out unreliable financial figures in a rush to meet the deadlines.

Fannie Mae and Freddie Mac, its smaller rival, were created by Congress to pump money into the $8 trillion home-mortgage market. They buy and guarantee repayment of billions of dollars of home loans each year from banks and other lenders, then bundle them into securities that are resold to investors worldwide.

Fannie Mae shares rose $1.01, or 1.9 percent, to close at $55.67 Wednesday on the New York Stock Exchange, before news of the delay was released. The stock has traded between $49.75 and $77.80 over the past year.

Fannie Mae: http://www.fanniemae.com

Freddie Mac: http://www.freddiemac.com

Securities and Exchange Commission: http://www.sec.gov