Fannie Mae

Good day and welcome to the Fannie Mae Second Quarter 2025 Financial Results Webcast. At this time, I will now turn it over to your host, Terrence O'Hara, Fannie Mae's Director of Enterprise Communications.

Hello, and thank you for joining today's webcast to discuss Fannie Mae's Second Quarter 2025 Financial Results. Please note this webcast includes forward-looking statements, including expectations related to housing market conditions, the future performance of the company's book of business, the company's future financial performance, and the company's future plans and their impact. Future events may turn out to be very different from these statements. The forward-looking statements section of the company's second quarter 2025 Form 10Q filed today and in the company's 2024 Form 10K filed on February 14, 2025, identify factors that may lead to different results. A recording of this webcast may be posted on the company's website. We ask that you do not record this webcast for public broadcast and that you do not publish any full transcript. I'd like now to turn the call over to Fannie Mae's President and Chief Executive Officer, Priscilla Almodovar, and Fannie Mae Chief Financial Officer, Krissa C. Halley.

Good morning. Thank you for joining us for Fannie Mae's second quarter earnings call. Today, we're excited to share some changes to our quarterly earnings materials, which we made to help enhance the understanding of our results. You'll notice that we've rebranded what we previously called our financial supplement into an earnings presentation. During this call, we'll refer to the earnings presentation to share our results and explain the drivers of our performance. And with that, let me start with key highlights for the second quarter on page one. We reported $3.3 billion of net income, which is down 9% versus first quarter and down 26% year-on-year, predominantly due to a higher provision for credit losses. Net revenues were $7.2 billion, up 2% versus first quarter, and relatively flat year-on-year. Meanwhile, our focus on efficiency remains a top priority, and during the quarter, non-interest expenses were down over $250 million, versus the prior quarter. Reflecting the progress on expenses, our efficiency ratio this quarter was 31.5%. This progress on expenses was greatly aided by the efficiency and deregulation efforts of Director Pulte and the entire team at U.S. Federal Housing. Our guarantee book, which held relatively flat at 4.1 trillion, drove our second quarter guarantee fee revenues, and we built 3.7 billion of regulatory capital. We calculate illustrative return on required common equity Tier 1 as a way to measure and compare our performance to peers. And in the second quarter, our return on equity was 9.5%. Now, turning to our impact, at Fannie Mae, our mission is the heart of what we do. In the second quarter, we proudly continued to make a material positive impact for American households. Despite a sluggish spring homebuying season, we provided $102 billion of liquidity to the mortgage market. This helped 381,000 households, including 183,000 homebuyers, 52% of whom were first-time homebuyers. We also helped to keep over 25,000 households in their homes by offering various forms of assistance. Year to date, we have provided $178 billion of liquidity to the mortgage market and have helped 668,000 households buy, refinance, or rent a home in the U.S. Additionally, this quarter, we had a few notable achievements at Fannie Mae. We announced a fraud detection and prevention partnership with Palantir Technologies. We surpassed $100 billion of total equity, which we refer to as net worth. ending the quarter at 101.6 billion. And we ranked 25 in the 2025 Fortune 500. In summary, the second quarter delivered on our expense focus while also highlighting our steady revenues and commitments to building capital and achieving attractive returns. We are steadfast in our mission and in safely and soundly making a positive impact on American housing. In partnership with Director Pulte and U.S. Federal Housing, our Fannie Mae team is deeply engaged and energized to continue to find ways to make housing more affordable, drive efficiencies, and prevent fraud. Now I'll turn the call over to Priscilla Haley, our Chief Financial Officer, to walk through the financial results in more detail.