The Federal Agricultural Mortgage Corp. has announced that it will restate earnings for the last three years to correct errors in hedge accounting.Farmer Mac said the restatement for 2003 through 2005 reflects the company's interpretation of Statement of Financial Accounting Standards No. 133, which covers derivatives and hedging instruments. The government-sponsored enterprise determined that its documentation did not support the use of hedge accounting for derivatives used to manage interest rate risk. Therefore, changes in the fair value of its derivatives should have been included in the statements of operations rather than being deferred or offset. While earnings will change under generally accepted accounting principles as a result, Farmer Mac said the restatement will have an "insignificant" effect on the company's financial position, stockholders' equity, cash flows, and business model. Farmer Mac also said the restatements will not have a significant effect on its capital position or its "core earnings," a non-GAAP measure of profitability. Farmer Mac can be found online at http://www.farmermac.com.
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The massive mortgage business saw a first quarter profit mitigated by nearly $300 million in hedging losses.
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The Consumer Financial Protection Bureau has seen excessive property-inspection charges, fees that loan mods should eliminate and improper line-item labels.
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Michael Tannenbaum, whose experience in the financial services industry spans over 15 years, has a track record of helping companies scale and grow.
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A majority of consumers earning more than $100,000 annually said they were concerned about their own ability to purchase a home, demonstrating how affordability issues are impacting those at many socioeconomic levels, the University of Michigan study found.
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The nonbank's results add to other indications that the first quarter's "higher for longer" rate scenario had an upside for efficient servicing operations.
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The latest rate increases contributed to a 1% drop in purchases from the previous week and 15% annually, according to the Mortgage Bankers Association.
April 24