Fannie Mae <FNM.N>, the largest provider of financing for U.S. home loans, on Wednesday reported a $3.6 billion quarterly loss as the housing slump deepened, sending its shares to a 12-year low.
The government-chartered company posted a $3.80 per share net loss for the fourth quarter. That compares with a profit of $604 million in the year-earlier period and a $1.52 billion loss in the third quarter.
Analysts expected the company would post a fourth-quarter loss of $1.39 per share, according to Reuters Estimates.
A sharper-than-expected drop in home prices that first sparked a crisis in subprime lending has since tainted the entire U.S. housing market, hurting Fannie Mae and rival Freddie Mac <FRE.N>.
Rising delinquencies and foreclosures have led the companies to write down values of mortgage securities they own and increase reserves to cover their guarantees of payment on bonds held by investors.
Credit-related expenses soared to $3 billion last quarter from $326 million in the same period for 2006. Revenue rose 8.6 percent to $3.1 billion, driven by a 26.4 percent increase in guaranty fee income.