Fannie Mae-No Politics (FNMA)

[Accrafael]

The following is a press release from Standard & Poor's:

NEW YORK (Standard & Poor's) March 12, 2014--Standard & Poor's Ratings
Services said today that its ratings, including the senior debt ratings, on
Fannie Mae (AA+/Stable/A-1+) and Freddie Mac (AA+/Stable/A-1+) are unaffected
by U.S. Senate Banking Committee Chairman Tim Johnson (D-S.D.) and Ranking
Member Mike Crapo's (R-Idaho) announcement that they had reached an agreement
on a housing finance reform proposal--a key component of which is the goal of
winding down and ultimately eliminating Fannie and Freddie. They plan to
release the draft of their proposal in the coming days and move it to a vote
in the committee within weeks.

Our ratings on the debt of Fannie and Freddie rely on our assumption of an
"almost certain" likelihood of extraordinary government support from the U.S.
(see "Rating Government-Related Entities: Methodology and Assumptions,"
published on Dec. 9, 2010, on RatingsDirect). We do not view this announcement
as sufficient to change that assumption, for several reasons. One reason is
that the proposal, while apparently enjoying some bipartisan support, still
faces substantial legislative hurdles before becoming law, including passage
by the Senate Banking Committee, the Senate, the House of Representatives
(which has developed a competing proposal), and approval by the president.

We do not believe it is likely that all these hurdles would be crossed before
the 2014 midterm elections, the results of which could affect the likelihood
of the proposal being passed. In addition, if related legislation were passed
in 2014 or later, it is not clear that it would adopt the Johnson-Crapo
proposal without substantial revisions. Moreover, it is our understanding that
all legislative proposals that involve the eventual wind-down of Fannie and
Freddie propose to achieve this only over an extended period, generally at
least five years beyond the effective date of the legislation. Our ratings
generally do not attempt to gauge the likelihood of events that far in the
future.

Primary Credit Analysts: Matthew B Albrecht, CFA, New York (1) 212-438-1867;
[e-mail]
Nikola G Swann, CFA, FRM, Toronto (1) 416-507-2582;
[e-mail]
Devi Aurora, New York (1) 212-438-3055;
[e-mail]
Carmen Y Manoyan, New York (1) 212-438-6162;
[e-mail]


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(END) Dow Jones Newswires
03-12-14 1651ET