Fannie Mae 2006 Annual Report Download - page 278

9. Short-term Borrowings and Long-term Debt
We obtain the funds to finance our mortgage purchases and other business activities by selling debt securities
in both the domestic and international capital markets. We issue a variety of debt securities to fulfill our
ongoing funding needs.
Short-term Borrowings
Our short-term borrowings, borrowings with an original contractual maturity of one year or less, consist of
both “Federal funds purchased and securities sold under agreements to repurchase” and “Short-term debt” in
the consolidated balance sheets. The following table displays our short-term borrowings as of December 31,
2006 and 2005.
Outstanding
Weighted
Average
Interest
Rate
(1)
Outstanding
Weighted
Average
Interest
Rate
(1)
2006 2005
As of December 31,
(Dollars in millions)
Federal funds purchased and securities sold under
agreements to repurchase. . . . . . . . . . . . . . . . . . . . . . . $ 700 5.36% $ 705 3.90%
Fixed short-term debt:
Discount notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $158,785 5.16% $166,645 4.08%
Foreign exchange discount notes . . . . . . . . . . . . . . . . . 194 4.09 1,367 2.66
Other short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . 5,707 5.24 941 3.75
Total fixed short-term debt . . . . . . . . . . . . . . . . . . . . 164,686 5.16 168,953 4.07
Floating short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . — — 645 4.16
Debt from consolidations . . . . . . . . . . . . . . . . . . . . . . . . 1,124 5.32 3,588 4.25
Total short-term debt. . . . . . . . . . . . . . . . . . . . . . . . . . $165,810 5.16% $173,186 4.07%
(1)
Includes discounts, premiums and other cost basis adjustments.
Our federal funds purchased and securities sold under agreements to repurchase represent agreements to
repurchase securities from banks with excess reserves on a particular day for a specified price, with the
repayment generally occurring on the following day. Our short-term debt includes discount notes and foreign
exchange discount notes, as well as other short-term debt. Our discount notes are unsecured general
obligations and have maturities ranging from overnight to 360 days from the date of issuance.
Additionally, we issue foreign exchange discount notes in the Euro money market enabling investors to hold
short-term investments in different currencies. We have the ability to issue foreign exchange discount notes in
all tradable currencies in maturities from 5 days to 360 days. Both of these types of debt securities are issued
with interest rates that are either fixed or floating. We also have short-term debt from consolidations.
F-47
FANNIE MAE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)