Fannie Mae 2009 Annual Report Download - page 49

loans offered for sale in the secondary market by loan originators and other market participants, the nature of
the residential mortgage loans offered for sale (for example, whether the loans represent refinancings), the
current demand for mortgage assets from mortgage investors, the interest rate risk investors are willing to
assume and the yields they will require as a result, and the credit risk and prices associated with available
mortgage investments. Pursuant to its agency MBS purchase program, the Federal Reserve was an active and
significant purchaser of our MBS during 2009, which was significant in supporting the liquidity of our MBS.
Competition to acquire mortgage assets is significantly affected by pricing and eligibility standards. In 2008
and 2009, changes in our pricing and eligibility standards and in the eligibility standards of the mortgage
insurance companies reduced our acquisition of loans with higher LTV ratios and other high-risk features. In
addition, FHA has become the lower-cost option, or in some cases the only option, for loans with higher LTV
ratios.
Prior to the severe market downturn, there was a significant increase in the issuance of mortgage-related
securities by non-agency issuers, which caused a decrease in our share of the market for new issuances of
single-family mortgage-related securities from 2003 to 2006. Non-agency issuers, also referred to as private-
label issuers, are those issuers of mortgage-related securities other than agency issuers Fannie Mae, Freddie
Mac and Ginnie Mae. The subsequent mortgage and credit market disruption led many investors to curtail
their purchases of private-label mortgage-related securities. As a result, private-label mortgage-related
securities issuances were significantly curtailed. Accordingly, our market share significantly increased during
2008 and remained high in 2009. Our estimated market share of new single-family mortgage-related securities
issuances was 46.3% in 2009 and 45.4% in 2008, compared with 33.9% in 2007. Our estimated market share
in 2009 of 46.3% includes $94.6 billion of whole loans held for investment in our mortgage portfolio that
were securitized into Fannie Mae MBS in the second quarter, but retained in our mortgage portfolio and
consolidated on our consolidated balance sheets. Excluding these Fannie Mae MBS from the estimate of our
market share, our estimated 2009 market share of new single-family mortgage-related securities issuances was
43.2%.
During 2009, our primary competitors for the issuance of mortgage-related securities were Ginnie Mae (which
primarily guarantees mortgage-related securities backed by FHA-insured loans) and Freddie Mac. Our
estimated market share of new single-family mortgage-related securities issuances was approximately 38.9% in
the fourth quarter of 2009, compared with approximately 41.7% in the fourth quarter of 2008 and 48.5% in
the fourth quarter of 2007. In comparison, Ginnie Mae’s market share of new single-family mortgage-related
securities issuances was approximately 34.5% in the fourth quarter of 2009, compared with approximately
37.8% in the fourth quarter of 2008 and 9.0% in the fourth quarter of 2007. Our estimates of market share
exclude previously securitized mortgages and are based on publicly available data.
We also compete for low-cost debt funding with institutions that hold mortgage portfolios, including Freddie
Mac and the FHLBs.
EMPLOYEES
As of December 31, 2009, we employed approximately 6,000 personnel, including full-time and part-time
employees, term employees and employees on leave.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We make available free of charge through our Web site our annual reports on Form 10-K, quarterly reports on
Form 10-Q, current reports on Form 8-K and all other SEC reports and amendments to those reports as soon
as reasonably practicable after we electronically file the material with, or furnish it to, the SEC. Our Web site
address is www.fanniemae.com. Materials that we file with the SEC are also available from the SEC’s Web
site, www.sec.gov. You may also request copies of any filing from us, at no cost, by calling the Fannie Mae
Fixed-Income Securities Helpline at [phone] or [phone] or by writing to Fannie Mae,
Attention: Fixed-Income Securities, 3900 Wisconsin Avenue, NW, Area 2H-3S, Washington, DC 20016.
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