Fannie Mae 2006 Annual Report Download - page 113

long-term and short-term senior unsecured debt, qualifying benchmark subordinated debt and preferred stock
as of August 15, 2007.
Table 25: Fannie Mae Debt Credit Ratings
Senior
Long-Term
Unsecured Debt
Senior
Short-Term
Unsecured Debt
Qualifying
Benchmark
Subordinated Debt
Preferred
Stock
Standard & Poor’s. . . . . . . . . . . . . . . . . . . . . . . . . AAA A-1+ AA-
(1)
AA-
(1)
Moody’s ............................... Aaa P-1 Aa2
(2)
Aa3
(2)
Fitch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AAA F1+ AA-
(3)
AA-
(4)
(1)
On December 7, 2006, Standard & Poor’s removed our ‘AA-’ preferred stock and subordinated debt ratings from
“CreditWatch with negative implications.” The ratings were affirmed and the outlook is negative.
(2)
On December 15, 2005, Moody’s confirmed our preferred stock and subordinated debt ratings with a “stable outlook.”
(3)
On December 7, 2006, Fitch removed our subordinated debt rating from “Rating Watch Negative” and affirmed the
‘AA-’ rating. The outlook is stable.
(4)
On December 7, 2006, Fitch upgraded our preferred stock rating to ‘AA-’ from ‘A+’ and removed the “Rating Watch
Negative.” The outlook is stable.
Pursuant to our September 1, 2005 agreement with OFHEO, we agreed to seek to obtain a rating, which will be
continuously monitored by at least one nationally recognized statistical rating organization, that assesses, among
other things, the independent financial strength or “risk to the government” of Fannie Mae operating under its
authorizing legislation but without assuming a cash infusion or extraordinary support of the government in the
event of a financial crisis. We also agreed to provide periodic public disclosure of this rating.
Our “risk to the government” rating by Standard & Poor’s as of August 15, 2007 is ‘AA-’ with a negative
outlook. On December 7, 2006, Standard & Poor’s removed this rating from “CreditWatch with negative
implications” and placed the rating on a negative outlook. Our “Bank Financial Strength Rating” by Moody’s
as of August 15, 2007 is ‘B+’ with a stable outlook.
We do not have any covenants in our existing debt agreements that would be violated by a downgrade in our
credit ratings. To date, we have not experienced any limitations in our ability to access the capital markets due
to a credit ratings downgrade. See “Item 1A—Risk Factors” for a discussion of the potential risks associated
with a downgrade of our credit ratings.
Contractual Obligations
Table 26 summarizes our expectation as to the effect on our liquidity and cash flows in future periods of our
minimum debt payments and other material noncancelable contractual obligations as of December 31, 2006.
Our current contractual obligations as of the date of this report are different than the contractual obligations as
of December 31, 2006 presented in the table below, primarily with respect to our debt obligations. We had
total outstanding debt of $767.7 billion and $764.7 billion as of December 31, 2006 and 2005, respectively.
Table 26: Contractual Obligations
Total
Less than
1 Year
1to3
Years
3to5
Years
More than
5 Years
Payments Due by Period as of December 31, 2006
(Dollars in millions)
Long-term debt obligations
(1)
. . . . . . . . . . . . . . . . . . . . . . $594,473 $134,560 $187,050 $105,508 $167,355
Contractual interest on long-term debt obligations
(2)
. . . . . . 154,166 27,430 39,310 24,812 62,614
Operating lease obligations
(3)
...................... 181 36 47 40 58
Purchase obligations:
Mortgage commitments
(4)
. . . . . . . . . . . . . . . . . . . . . . 21,799 21,681 118 — —
Other purchase obligations
(5)
.................... 85 74 11 — —
Other long-term liabilities reflected in the consolidated
balance sheet
(6)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,433 3,882 1,145 182 224
Total contractual obligations . . . . . . . . . . . . . . . . . . . . . . $776,137 $187,663 $227,681 $130,542 $230,251
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