Fannie Mae says it needs $19B more after $23B Q1 loss

WASHINGTON -- The mortgage finance company, which got a $15 billion government bailout in March, warned it may need even more money and won't be profitable for the foreseeable future.

In a regulatory filing the company said "there is significant uncertainty as to our long-term financial sustainability." Even more government aid, it added, "may not be sufficient to keep us in a solvent condition."

Fannie Mae posted a quarterly loss of $23.2 billion, or $4.09 a share. That compares with a loss of $2.5 billion, or $2.57 a share, in the year-ago period.

The Obama administration's estimates the taxpayer bill for Fannie and Freddie will hit $147 billion out of a potential $400 billion by the end of September 2010.

Fannie Mae and Freddie Mac play a vital role in the mortgage market by purchasing loans from banks and selling them to investors. Together, Fannie and Freddie own or guarantee almost 31 million home loans worth about $5.5 trillion. That's about half of all U.S home mortgages.

The two companies lowered their standards for borrowers during the real estate boom and are reeling from the bust. High-risk loans in California, Nevada, Arizona and Florida defaulting at a record pace have come back to haunt the companies. Worse still, the recession the housing crisis caused is causing reliable homeowners with good credit to default.

Even loans to low-risk borrowers have "begun to experience increases in delinquency and default rates as a result of the sharp rise in unemployment, the continued decline in home prices" and the long economic downturn, the company said.