Thank you for making 2017 an outstanding year for Fannie Mae Multifamily and our DUS partners. Today, Multifamily posted annual pre-tax income of $2.6 billion. I am excited to announce that our average multifamily guaranty book of business grew 14% from 2016 to 2017. This is a true testament to the strength of our relationships with our Lenders and our dedication to serving them. Additional filing highlights are below.
It is our partnership in the Loan We All Own™ that makes all the difference in our results. I look forward to our continued success in providing financing and securitization for affordable and workforce rental housing -- in every market, for every income level, every day.
Multifamily Business Highlights
- Multifamily's pre-tax income was $2.6 billion in 2017, driven by $2.5 billion in net interest income, which primarily consists of guaranty fee revenue. Our guaranty fee revenue continued to increase as the average multifamily guaranty book of business grew 14% from 2016 to 2017.
- Fannie Mae provided more than $67 billion in multifamily and other rental financing, the highest multifamily rental volume in the history of Fannie Mae's DUS® program. Approximately 46 percent of Fannie Mae's 2017 multifamily new business and other rental volume counted toward FHFA's 2017 multifamily volume cap.
- Multifamily and our DUS partners provided financing for approximately 770,000 units of multifamily housing in 2017. Approximately 90% of the multifamily units we financed were affordable to families earning at or below 120% of the median income in their area, providing support for both workforce housing and affordable housing.
- The multifamily serious delinquency rate for Fannie Mae's book of business increased to 11 basis points as of the end of 2017, driven by the impact of the hurricanes.
- Fannie Mae reported 2017 net income of $2.5 billion, compared with net income of $12.3 billion in 2016. Fannie Mae's annual pre-tax income for 2017 was $18.4 billion, compared with $18.3 billion in 2016, reflecting the strength of the company's underlying business fundamentals.
- The primary driver of changes in the company's net income for full year 2017 and the fourth quarter of 2017 was a $9.9 billion provision for federal income taxes in the fourth quarter resulting from the remeasurement of the company's deferred tax assets due to the Tax Cuts and Jobs Act. As a result, Fannie Mae reported a net worth deficit of $3.7 billion as of December 31, 2017. To eliminate the company's net worth deficit, the company expects the Director of the Federal Housing Finance Agency (FHFA) will submit a request to Treasury on the company's behalf for $3.7 billion.
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