Fannie Mae To Sell $7 Billion In 5-Year Note Tuesday
February 03 2009 - 9:36AM
Dow Jones News
Fannie Mae (FNM) will sell a $7 billion five-year note Tuesday
morning.
The note is the first of its two debt securities to be sold this
month.
Market participants have said the focus is on how much of a
premium investors would demand to buy the debt security.
The price talk on the new five-year note is at 93 basis points
over comparable Treasurys. The spread is wider than the existing
quote for Freddie Mac's (FRE) five-year note that was trading at
around 75 basis points on Tuesday morning.
Foreign central banks have recently increased their holdings of
agency debt. Data from the Federal Reserve last week showed a rise
in foreign central bank holdings of agency debt to $817.81 billion
from $806.52 billion in the prior week, the first increase in
months.
In January, Fannie raised $6 billion through a three-year note,
and demand from U.S. investors prompted the mortgage company to
increase the size of the initial offering.
In September 2008, Fannie sold $7 billion in two-year notes.
-By Anusha Shrivastava, Dow Jones Newswires; 201-938-2371;
anusha.shrivastava@dowjones.com
(Prabha Natarajan contributed to this report.)
Click here to go to Dow Jones NewsPlus, a web front
page of today's most important business and market news, analysis
and commentary. You can use this link on the day this article is
published and the following day.