Fannie Mae-No Politics (FNMA)

[bcde]

Go read 12 USC 4612(a) to see the minimum capital standard, and then read 12 USC 4614(a)(1)(B) to see that it can only be met with core capital. To top it off, read 12 USC 4502(7) for the definition of core capital. All of these are the law.

A government backstop in no way counts towards core capital.

Just reading does not help if one don't understand concepts.

With gov backstop, the core capital requirements come down by the matching backstop amount even though it does not increase core capital of the company. In a way, gov Guarantees or gov credit line can be equated to equity.