NEW YORK (Standard&Poor's) Nov. 10, 2008--Fannie Mae today reported a sizeable $29 billion loss in third-quarter 2008 due to its establishment of a $21.4 billion deferred tax-asset valuation allowance and a large $9.2 billion credit-loss provision. This quarterly loss has no impact on Standard&Poor's Ratings Services' ratings on Fannie Mae's 'AAA/A-1+' senior debt, 'A' subordinated debt, or 'C' preferred stock, since Fannie Mae is operating under a regulatory conservatorship. The establishment of the valuation allowance for the deferred tax asset reflects the high degree of uncertainty surrounding Fannie Mae's earnings as it operates under conservatorship. We believe that Fannie Mae's business plan, while under conservatorship, will be geared primarily to fulfilling its public policy role of
