Fannie Mae plunges to shock $2.3bn loss$

Fannie Mae today warned that worse was to come after America's biggest mortgage company swung into the red by $2.3 billion (£1.19 billion), marking a loss four times bigger than Wall Street's expectations. Shares in the company slid 17 per cent to $8.17 within seconds of Wall Street's opening, less than a third of their value a month ago. The home loan group, which has been forced to absorb more than $5 billion-worth of credit losses, had reported a net profit of $1.95 billion for the corresponding second quarter a year ago. It has now chalked up four consecutive quarters of losses. While Fannie Mae sought to reassure New York stock markets by insisting that it was "very unlikely" to need a cash injection from Washington, Daniel Mudd, the chief executive, said: "Volatility and disruptions in the capital markets became even... [read full story]