The 'AAA' rating on the senior debt of Fannie Mae reflects the company's very strong business franchise, its consistent operating performance, extraordinary efficiency, very good asset quality, and adequate risk adjusted capitalization. Fannie Mae has demonstrated consistently good operating performance during a sustained period, testifying to the company's ability to manage the risks inherent in holding a portfolio of mortgage loans, and the strength of its franchise as one of two government-sponsored mortgage guaranty agencies. It has successfully weathered changing conditions in the demand for mortgage guaranties, several regional housing market declines, and changing interest rate environments, including the current one of extremely low rates. Asset quality is very strong, and the credit risk profile of its mortgages is very
