Announcement

Fannie Mae Ceases Resecuritization of LIBOR-Indexed CMOs and MBS

May 12, 2022

In 2020, Fannie Mae and Freddie Mac (the Enterprises) announced the cessation of any new LIBOR-indexed Collateralized Mortgage Obligation (CMO) issuances and began offering new SOFR-indexed CMOs in preparation for the future cessation of LIBOR. To support liquidity in legacy LIBOR products, the Enterprises permitted investors to continue resecuritizing Single-Family and Multifamily LIBOR-indexed CMOs and MBS (i.e., re-REMICs and Megas) so long as the total unpaid principal balance of the LIBOR-indexed CMOs and MBS outstanding did not increase. Such transaction volume has been minimal and has steadily decreased since 2020.

Today, with the goal of a complete cessation of all new issuances of securities indexed to LIBOR, Fannie Mae, in alignment with Freddie Mac and in consultation with the Federal Housing Finance Agency (FHFA), is announcing that, effective June 30, 2022, it will stop resecuritizing existing LIBOR-indexed Single-Family and Multifamily CMOs and MBS into new-issuance LIBOR-indexed bonds. Any requested and approved final resecuritizations of existing LIBOR-indexed CMOs and MBS must settle on or before June 30, 2022. The resecuritization of LIBOR-indexed CMOs and MBS into appropriately structured new-issue SOFR bonds will continue to be permitted.

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This announcement does not constitute an offer to sell or the solicitation of an offer to buy securities of Fannie Mae. Nothing in this announcement constitutes advice on the merits of buying or selling a particular investment. Any investment decision as to any purchase of securities referred to herein must be made solely on the basis of information contained in Fannie Mae's applicable Prospectus and the Prospectus Supplement and the related legal documentation, and no reliance may be placed on the completeness or accuracy of the information contained in this announcement.

You should not deal in securities unless you understand their nature and the extent of your exposure to risk. You should be satisfied that they are suitable for you in light of your circumstances and financial position. If you are in any doubt you should consult an appropriately qualified financial advisor.