Freddie Mac will send $3.9 billion to the Treasury Department next month after reporting second-quarter net income of $4.2 billion.
The new payment by Freddie Mac, which has been under conservatorship since 2008, will bring total returns to $96.5 billion, according to a statement released Tuesday by the McLean, Va.-based company. The figure is far beyond what the company received in federal aid to stay afloat during the credit crisis.
Freddie Mac and larger rival Fannie Mae are required to pay Treasury all profits above a minimum net worth under terms established after they were seized by regulators amid losses that pushed them to the brink of collapse. The money counts as a return on the U.S. investment and not as repayment, leaving no existing mechanism for them to exit government control.
The heads of both companies were granted pay increases from a flat $600,000 to as much as $4 million a year last month, after the Federal Housing Finance Agency authorized the raises. That decision is under fire by the Treasury Department and some members of Congress, who support a bill to roll back the pay level for the chief executives.
