Bailed out, Fannie flies on US demand
The success of Fannie Mae’s $7bn two year issue launched on Tuesday demonstrated with some pizzazz that, after the weekend bailout, GSEs are able access financial markets for decent size and fund at attractive levels, at least in short to medium maturities.
Fannies deal garnered a book of $9.4bn at a spread of 70bp over Treasuries, which equated to mid-swaps less 26bp at the time of pricing. In stark contrast, pre-rescue Freddie Mac priced its $3bn two year bond at mid-swaps less 6bp.
The strong demand was seen as a vote
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