Fannie Mae, the government-funded mortgage lender, had some surprising news earlier today. During 2012, for the first time in four years, it didn't require any funding from the Treasury Department. And, better yet, it contributed $7.6 billion back into the government's pocketbook. Which inspired us to check in on the government's other semi-willing recession-era investments.
The news about Fannie Mae is undeniably good. The Times' Dealbook blog explains the significance:
The huge profits rolling in at Fannie, and at its corporate sibling Freddie Mac, reflect the enormous role the government is playing in the housing market nearly five years after the crisis. As a result, the earnings will intensify the debate over the role that government should play in supporting housing.
Fannie and Freddie charge fees in return for a guarantee that they will pay back mortgages that default. In the first years after the crisis, that fee revenue was overwhelmed by losses. As those have abated, profits have returned for the two mortgage giants.
According to the agency's full press release, here's how its "draws from Treasury" (took) and "dividend payments to Treasury" (paid) compare.
Fannie Mae repaymentTookRepaid200820092010201120121020304050billions
Clearly the trend is good. But it will take a while to make up for that giant red spike. The entire amount repaid since 2009 amounts to only about half of what was borrowed that year. Or, to put it another way, here's the ratio of what has been borrowed to what has been repaid.
Fannie Mae27%73%
Thirty-one billion down, 85 billion to go.
We can do a similar calculation for the other elements of the government bailout or, at least, those items included in the Troubled Asset Relief Program, or TARP. At its creation, the government assigned a special inspector general to review TARP investments and compile quarterly reports on the process. The most recent report came out in January, and suggests that the government is doing much better with TARP than with Fannie Mae.
The most important chart is this one. Of the $418 billion TARP has loaned out (or, in some cases, gave), $344.8 has been repaid. (The actual outstanding amount is about $67.3 billion, due to rounding errors.) Over 83 percent of the money has been repaid.
TARP, overall16.3%83.7%
The Inspector General's report breaks TARP down into ten programs. Here's how each has fared, with SIGTARP's descriptions of each beneath. Full descriptions start on page 43 here. (We've included the Fannie Mae figures and the TARP total in this first graph.)
Repayment statusTookRepaid0.00125.00250.00375.00500.00(Fannie Mae)Housing support programsCapital purchase programCommunity development capital initiat...Systemically significant failing instituti...Targeted investment programAsset guarantee programTerm asset-backed securities loan fac...Public-private investment programUnlocking credit for small businessesAutomotive industry support programsTARP Totalbillions
Housing support programs
Description: Modification of mortgage loans
Status: Open
Amount loaned: $6.4 billion
Amount repaid: $0 billion (This program does not require repayment.)
Capital purchase program
Description: Investments in 707 banks
Status: Closed
Amount loaned: $204.9 billion
Amount repaid: $194.3 billion
Percent repaid:5.2 percent
Capital purchase program94.8%
Community development capital initiative
Description: Investments in Community Development Financial Institutions (CDFIs)
Status: Closed
Amount loaned: $0.2 billion
Amount repaid: $0 billion
Percent repaid:250 percent
Systemically significant failing institutions
Description: AIG investment
Status: Closed
Amount loaned: $67.8 billion
Amount repaid: $54.4 billion
Percent repaid:19.9 percent
Systemically significant failinginstitutions19.9%80.1%
Targeted investment program
Description: Citigroup, Bank of America investments
Status: Closed
Amount loaned: $40 billion
Amount repaid: $40 billion
Percent repaid:0 percent
Targeted investment program100%
Asset guarantee program
Description: Citigroup, ring-fence asset guarantee
Status: Closed
Amount loaned: $0 billion
Amount repaid: $0 billion
Percent repaid:0 percent
Term asset-backed securities loan facility
Description: FRBNY non-recourse loans for purchase of asset-backed securities
Status: Open
Amount loaned: $0.1 billion
Amount repaid: $0 billion
Percent repaid:100 percent
Public-private investment program
Description: Investments in legacy mortgage-backed securities using private and Government equity, along with Government debt
Status: Open
Amount loaned: $18.6 billion
Amount repaid: $15 billion
Percent repaid:19.4 percent
Public-private investment program19.4%80.6%
Unlocking credit for small businesses
Description: Purchase of securities backed by sba loans
Status: Closed
Amount loaned: $0.4 billion
Amount repaid: $0.4 billion
Percent repaid:0 percent
Automotive industry support programs
Description: GM, Chrysler, ally Financial inc. (formerly GMaC), Chrysler Financial; received $34.2 billion in loan repayments, preferred stock redemptions and proceeds from the sale of common stock; terminated Chryslers $2.1 billion in undrawn loan commitments
Status: Closed
Amount loaned: $79.7 billion
Amount repaid: $40.7 billion
Percent repaid:48.9 percent
Automotive industry supportprograms48.9%51.1%
To this last point, you may be curious: How have individual automakers fared? Chrysler is out of TARP. GM still owes taxpayers $21.6 billion. Or, in our ongoing efforts to make such numbers accessible enough to buy 1.26 million Chevy Cruzes.
