Fannie Mae-No Politics (FNMA)

[FOFreddie]

Hi Kthomp,

The underwriters will paid a placement fee for any security they underwrite and distribute. This includes convertible preferred, COCO debt and new non cumulative preferred debt.

All of these securitis will have less of a dilutive effect or cause no dilution - as is the case with the non cumulative preferred.

According to Nomura we could see common, convertible preferred and non cumulative preffered to be issued.

The underwriters have no incentive to dilute common shareholders but just make money. The amount of dilution will be driven by financial and legal outcomes germane to the GSEs not a far fetched incentive to dilute common shareholders.