Problems in the United States housing market have pushed mortgage finance company Fannie Mae deeper into the red.
The group sank to a net loss of $US2.3 billion in the three months to 30 June, against a profit of $US1.97b last year.
Its sister company Freddie Mac has already posted worse than expected results and warned that falls in house prices are not over yet.
Both government sponsored firms own, or guarantee, nearly half of the nation's mortgage debt.
Shares in Fannie Mae sank after the announcement, falling 9.8% to $US8.98.
As mortgage guarantors, Fannie Mae and Freddie Mac, must pay out when people default on their loans. But as a result of recent woes in the US housing market and subsequent sub-prime crisis, they have run into severe difficulty.
Fannie Mae said that the current housing crisis had added to its woes to the tune of $US5.3b in credit expenses.
The latest losses follow a $US2.2b loss for the first three months of the year.
President and chief executive officer Daniel H Mudd says the company has taken steps to raise an additional $US7b to help it tackle the what he describes as the "most difficult US housing market in more than 70 years".
Last month, the federal government offered a financial lifeline to the two beleaguered companies offering to extend their line of credit. However, this may leave the taxpayer facing a bill of $US25b over the next two years.
