On Aug. 11, 2008, Standard&Poor's Ratings Services affirmed its 'AAA/Stable/A-1+' senior debt rating on Fannie Mae. At the same time, we lowered our risk-to-the-government rating on Fannie Mae to 'A' from 'A+', and our preferred stock and subordinated debt rating to 'A-' from 'AA-'. These ratings were removed from CreditWatch Negative where they were placed July 25, 2008. The outlook is negative. The affirmation of the 'AAA' senior debt rating reflects the strong explicit and implicit U.S. government support these securities hold in the marketplace, as evidenced by the recent U.S. Treasury actions. This underscores the key public policy role and the key liquidity role the congressionally chartered government-sponsored enterprises (GSEs) have in the U.S. mortgage market. The
