NEW YORK (Standard&Poor's) Dec. 5, 2007—Standard&Poor's Ratings Services said today that Fannie Mae's (risk to the government AA/Negative) announcement that it plans to issue $7 billion of preferred stock (AA-/Negative/--) and cut its common dividend 30% will not affect the ratings on Fannie Mae. These critical steps were taken to maintain a capital position that will support its core mortgage business and lower earnings due to the stress in the housing and mortgage markets. The $7 billion issuance received full capital treatment from its regulator for regulatory capital compliance, but zero equity credit based on our hybrid capital criteria. Still, this preferred stock issuance and common dividend cut will allow Fannie Mae to maintain compliance with
