Early Briefing: Fannie's Disappearing Capital
By Alejandro Lazo
So it turns out that nearly half of the capital mortgage giant Fannie Mae was sitting on in the months before being taken over by the government is now worthless. That's the news this morning from staff writer Zachary A. Goldfarb.
He reports that District-based Fannie has effectively written down the value of its deferred tax assets, which comprised $20.6 billion of its $47 billion in capital at the end of the second quarter. These credits toward corporate taxes are only valuable when a company expects to bring in profits. But as was the case, both Fannie and McLean-based rival Freddie Mac, were taking big losses on the mortgage bonds they own and guarantee.
In news regarding the failure of another big financial firm, this time insurer American International Group, Metro is battling a Belgian bank that is demanding a $43 million payment. AIG had guaranteed Metro's financial deals with the bank, KBC Group, but the insurer's financial problems have invalidated that insurance. Metro asked a federal judge Wednesday to issue a temporary restraining order against the bank, which is asking for its money back by Friday.
Georgetown University students had plenty of questions Wednesday for Matt Ivester. He is the founder of the gossip Web site JuicyCampus.com, which invites students on college campuses to post anonymous and often salacious gossip about fellow classmates online.
As staff writer Susan Kinzie describes it, "It's not unlike the bathroom wall at a dive bar, except that anyone, anywhere, can read it. And it never gets erased or painted over."
It was the first time Ivester has taken questions from students anywhere about the year-old site, which is on 500 campuses across the country and still in the red. Some asked the former Duke fraternity boy how he could live with himself.
Some more local earnings are in.
Corporate Office Properties Trust reported net income of $8.9 million (19 cents per share) for the third quarter ended Sept. 30. That compared with $7.4 million (15 cents) for the third quarter last year. The real estate investment trust specializes in super-secure buildings for the defense industry. Revenues were $101.6 million, up from $94.1 million a year ago.
United Therapeutics booked net income of $12.6 million (55 cents) a decline from $14.8 million (70 cents) in the year-ago period. The Silver Spring biotechnology company's revenue was $75 million, up from $59.0 million.
Meanwhile Rockville-based biotech Vanda Pharmaceuticals continued to struggle in the third quarter. The company reported a loss of $10.9 million (41 cents) compared to $21.9 million (82 cents) for the third quarter of 2007.
And Strayer Education of Arlington said its profits grew 27 percent. The for-profit college reported net income of $11.8 million (83 cents) compared with $9.3 million (64 cents). Revenues were up 25 percent, to $87 million from $69.8 million one year ago.
October 30, 2008; 7:58 AM ET
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