WASHINGTON (Reuters) - Fannie Mae , the nation's biggest mortgage finance company, said on Thursday it will pay $59.4 billion in dividends to the U.S. Treasury after a record profit in the first quarter that reflecting a multibillion dollar gain from reversing an earlier writedown of tax benefits.
The government-controlled company reported pretax income of $8.1 billion for the quarter and booked an additional gain of $50.6 billion on the tax assets, resulting in net income of $58.7 billion. That compared to a $2.7 billion profit in the same three months a year earlier.
Since its return to profitability, Fannie Mae has been considering when to start counting potential tax credits as part of its net worth.
"After evaluating the recoverability of Fannie Mae's deferred tax assets ... the company determined that the factors in favor of releasing the allowance outweighed the factors in favor of maintaining it," Fannie Mae said in a statement.
Fannie Mae has received about $116 billion in taxpayer funds since September 2008, when it was seized by regulators along with Freddie Mac. By the end of June, Fannie Mae will have paid $95 billion in dividends to Treasury for the government's stake, leaving the net cost of its bailout at about $21 billion.
Fannie Mae and sibling Freddie Mac buy home loans and package them into securities, ensuring that investors receive payments even when borrowers default. Both the Obama administration and Congress want to eventually wind them down.
(Reporting by Margaret Chadbourn; Editing by Jeffrey Benkoe)