filed its second consecutive Form 12b-25 with the
Securities and Exchange Commission (SEC)
last week, reporting that it
will not file its First Quarter 2005 10-Q report with that agency in a timely
Earlier this year the Fannie Mae Corporation filed a Form
12b-25 for Fourth Quarter 2004 and still has not produced that quarterly report.
Fannie has also informed the SEC that it is still unable to provide “a
reasonable estimate” of its earnings for either 2003 or 2004. Estimates
of a “restatement of earnings” for the years 2001
through 2004 range up to $9 billion. The Corporation did say that its administrative
expenses for the First Quarter rose to an estimated $440 million from $383 million
which appears to be the amount expended during the first quarter of 2004. It
is assumed that the increase is due to the massive accounting review which the
Corporation has been undertaking since it admitted to accounting irregularities
Since those revelations, the SEC and the Department of Justice
announced that they are investigating the Fannie Mae Corporation. The Office
of Federal Housing Enterprise Oversight
, the agency charged with regulating
Fannie Mae and its smaller sister Freddie Mac; members of Congress, Federal
Reserve Chairman Alan Greenspan
, and several mortgage and real estate interest
groups have called for additional regulation of the Corporation. Greenspan and
the Bush Administration want to see a forced reduction in the mortgage portfolios
that the two Government Sponsored Enterprises are permitted to maintain. Key
leaders in Congress, however, currently seem disposed to allow a regulator with
beefed up authority some flexibility in setting portfolio limits.
In an attempt to contain the criticism arising from its account problems, Fannie
Mae ditched two of its top executives and fired its accounting firm last December.
In early 2005 it cut its divided for the last quarter of 2004 in half and has
maintained that level for the first quarter of 2005. Its New York Stock Exchange
traded stock is substantially off of its 52 week high of $77.80. Late Wednesday
afternoon it stood at $56.45.