Fannie Sees Callable Debt as a "Cornerstone"

Callable securities have become a "cornerstone" in Fannie Mae's strategies, chief financial officer Timothy Howard said in a Webcast conference the morning of Feb. 27 that, among other things, highlighted efforts the company has undertaken to manage its risk and provide assurance to global debt investors.Mr. Howard said over 50% of Fannie's debt is "effectively" callable, allowing the company to get the optionality it needs. He also detailed the ways Fannie Mae has tested its ability to manage risk in various interest rate scenarios, during the Salomon Smith Barney conference. Mr. Howard said Fannie Mae focuses on such efforts due to its size, involvement in the international market and prominence in the U.S. financial system, all of which necessitate "the highest level of confidence" from its investor base. "We need to raise billions (of dollars) across the world in short period of time without questions about whether our debt is money good," he said.