Fannie Mae 2013 Annual Report Download - page 111

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While our liquidity contingency planning attempts to address stressed market conditions and our status under conservatorship
and Treasury arrangements, we believe that our liquidity contingency plans may be difficult or impossible to execute for a
company of our size in our circumstances. See “Risk Factors” for a description of the risks associated with our liquidity
contingency planning.
Debt Funding
We separately present the debt from consolidations (“debt of consolidated trusts”) and the debt issued by us (“debt of Fannie
Mae”) in our consolidated balance sheets and in the debt tables below. Our discussion regarding debt funding in this section
focuses on the debt of Fannie Mae. We fund our business primarily through the issuance of short-term and long-term debt
securities in the domestic and international capital markets. Because debt issuance is our primary funding source, we are
subject to “roll-over,” or refinancing, risk on our outstanding debt.
We have a diversified funding base of domestic and international investors. Purchasers of our debt securities are
geographically diversified and include fund managers, commercial banks, pension funds, insurance companies, foreign
central banks, corporations, state and local governments, and other municipal authorities.
Our debt funding needs may vary from quarter to quarter depending on market conditions and are influenced by anticipated
liquidity needs, the size of our retained mortgage portfolio and our dividend payment obligations to Treasury. Under the
senior preferred stock purchase agreement, we were required to reduce our retained mortgage portfolio to $552.5 billion by
December 31, 2013 and, by December 31 of each year thereafter, to 85% of the maximum allowable amount that we were
permitted to own as of December 31 of the immediately preceding calendar year, until the amount of our mortgage assets
reaches $250 billion.
Fannie Mae Debt Funding Activity
Table 29 displays the activity in debt of Fannie Mae for the periods indicated. This activity excludes the debt of consolidated
trusts and intraday loans. The reported amounts of debt issued and paid off during the period represent the face amount of the
debt at issuance and redemption, respectively. Activity for short-term debt of Fannie Mae relates to borrowings with an
original contractual maturity of one year or less while activity for long-term debt of Fannie Mae relates to borrowings with an
original contractual maturity of greater than one year.