The giant mortgage broker lost $1.2 billion in the second quarter and shelled out $1.9 billion in dividends to the department, The Hill newspaper reported Friday.

That's a sizable improvement from the first quarter, when Fannie Mae lost $11.5 billion.

But Fannie Mae, already in hock to the government for $84.6 billion, "does not expect to earn profits in excess of its annual dividend obligation to Treasury for the indefinite future," it said in a statement.

Fannie Mae and the Federal Home Loan Mortgage Corp., known as Freddie Mac, fell into government conservatorship in the fall of 2008 after suffering huge losses in the housing market collapse that had begun at least a year earlier.

The two mortgage brokers are known as government-sponsored enterprises because they are private companies that have agreed to purchase bundled mortgage securities that, as such, set the parameters for acceptable mortgages.

Their mission, in part, is to keep home ownership affordable.

Combined, the assets of the two firms in mortgage debt amount to about $5 trillion, roughly half the industry's total value. Since falling into conservatorship, the government has loaned the companies $147 billion to stay afloat.

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