The Federal National Mortgage Association yesterday reported a profit of $11.1 million for the second quarter of the year, following a first-quarter loss of $17.4 million.

In a statement, Fannie Mae Chairman David O. Maxwell termed the "return to profitability . . . gratifying evidence of major improvements in the corporation's financial performance."

Maxwell was on the West Coast yesterday and unavilable for comment, but he said after the corporation's annual meeting in May that he expects Fannie Mae to finish the year with a profit.

The sharply improved quarterly showing was due in large part to declining interest rates, which allowed the corporation to record a profit on the difference between the interest it receives on mortgages it owns and the interest it pays on the debt it must issue to finance them.

In recent years this spread has generally been negative, sometimes extremely so, pushing the company into the red despite growth of fees and other types of income.

As interest rates plunged this spring, "Fannie Mae's interest margin improved dramatically from a negative $46.6 million in the first quarter to a positive $1 million in the second quarter," Maxwell's statement said.

The $11.1 million profit equaled 16 cents a share, compared with a 26-cent-per-share loss for the first quarter. In the second quarter of 1984, the corporation recorded a $2.4 million profit (4 cents).

For the six months ended June 30, Fannie Mae showed a net loss of $6.2 million (9 cents), compared with a $16.9 million profit (26 cents) for the same period a year ago. Citizens Bancorp, parent company of Citizens Bank & Trust Co. of Maryland, announced second-quarter earnings of $5.5 million ($2.67 per share), a 14.5 percent increase over the $4.8 million ($2.34) profit reported for the same period last year. The Riverdale-based holding company now has assets of $1.1 billion and capital of $123.9 million, an increase of $15 million in the past year.