board of directors voted to increase the quarterly dividend on the company's common stock by 6 cents to 45 cents a share.
The company's dividend rate had been 39 cents a quarter.
"This dividend increase reflects management's confidence in the strength and sustainability of the cash flows of Fannie Mae's business," the company said in a press release. "It also recognizes an increased investor focus on dividend payouts in the wake of the reduction in the tax rate on dividends."
The dividend will be paid Aug. 25 to shareholders of record July 31. Fannie Mae is scheduled to report its quarterly earnings Tuesday morning.
Shares of Fannie Mae closed
New York Stock Exchange
trading at $71.38.