Short-Term Borrowings and Long-Term Debt

12 Months Ended

Dec. 31, 2014

Short-Term Borrowings and Long-Term Debt

Short-Term Borrowings

The following table displays our outstanding short-term borrowings (borrowings with an original contractual maturity of one year or less) and weighted-average interest rates of these borrowings as of December 31, 2014 and 2013.



	As of December 31,
	2014				2013
	Outstanding		Weighted- Average Interest Rate⁽¹⁾		Outstanding		Weighted- Average Interest Rate⁽¹⁾
	(Dollars in millions)
Federal funds purchased and securities sold under agreements to repurchase⁽²⁾	$	50	—	%	$	—	—	%

Fixed-rate short-term debt:
Discount notes⁽³⁾	$	105,012	0.11	%	$	71,933	0.12	%
Foreign exchange discount notes⁽⁴⁾	—		—		362		1.07
Total short-term debt of Fannie Mae	105,012		0.11		72,295		0.13
Debt of consolidated trusts	1,560		0.09		2,154		0.09
Total short-term debt	$	106,572	0.11	%	$	74,449	0.13	%

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⁽¹⁾	Includes the effects of discounts, premiums and other cost basis adjustments.


⁽²⁾	Represents agreements to repurchase securities for a specified price, with repayment generally occurring on the following day.


⁽³⁾	Represents unsecured general obligations with maturities ranging from overnight to 360 days from the date of issuance.


⁽⁴⁾	Represents foreign exchange discount notes we issue in the Euro commercial paper market with maturities ranging from 5 to 360 days which enable investors to hold short-term investments in different currencies.

Intraday Line of Credit

We periodically use a secured intraday funding line of credit provided by a large financial institution. We post collateral which, in some circumstances, the secured party has the right to repledge to third parties. As this line of credit is an uncommitted intraday loan facility, we may be unable to draw on it if and when needed. We had a secured uncommitted line of credit of $15.0 billion as of December 31, 2014 and had secured uncommitted lines of credit of $20.0 billion as of December 31, 2013. We had no borrowings outstanding from a line of credit as of December 31, 2014.

Long-Term Debt

Long-term debt represents borrowings with an original contractual maturity of greater than one year. The following table displays our outstanding long-term debt as of December 31, 2014 and 2013.



	As of December 31,
	2014					2013
	Maturities	Outstanding		Weighted-Average Interest Rate⁽¹⁾		Maturities	Outstanding			Weighted-Average Interest Rate⁽¹⁾
	(Dollars in millions)
Senior fixed:
Benchmark notes and bonds	2015 - 2030	$	173,010	2.41	%	2014 - 2030	$	212,234		2.45	%
Medium-term notes⁽²⁾	2015 - 2024	114,556		1.42		2014 - 2023	161,445			1.28
Foreign exchange notes and bonds	2021 - 2028	619		5.44		2021 - 2028	682			5.41
Other	2015 - 2038	32,322		4.63		2014 - 2038	38,444		(4)	4.99
Total senior fixed		320,507		2.29			412,805			2.24
Senior floating:
Medium-term notes⁽²⁾	2015 - 2019	24,469		0.15		2014 - 2019	38,441			0.20
Connecticut Avenue Securities⁽³⁾	2023 - 2024	6,041		2.97		2023	689			3.81
Other⁽⁴⁾	2020 - 2037	363		8.71		2020 - 2037	266			8.52
Total senior floating		30,873		0.81			39,396			0.32
Subordinated fixed:
Qualifying subordinated	—	—		—		2014	1,169			5.27
Subordinated debentures	2019	3,849		9.93		2019	3,507			9.92
Total subordinated fixed		3,849		9.93			4,676			8.76
Secured borrowings⁽⁵⁾	2021 - 2022	202		1.90		2021 - 2022	262			1.86
Total long-term debt of Fannie Mae⁽⁶⁾		355,431		2.24			457,139			2.14
Debt of consolidated trusts⁽⁴⁾	2015 - 2054	2,760,152		3.02		2014 - 2053	2,702,935			3.26
Total long-term debt		$	3,115,583	2.93	%		$	3,160,074		3.10	%

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⁽¹⁾	Includes the effects of discounts, premiums and other cost basis adjustments.


⁽²⁾	Includes long-term debt with an original contractual maturity of greater than 1 year and up to 10 years, excluding zero-coupon debt.


⁽³⁾	Credit risk sharing securities that transfer a portion of the credit risk on specified pools of mortgage loans to the investors in these securities. Connecticut Avenue Securities are reported at fair value.


⁽⁴⁾	Includes a portion of structured debt instruments that is reported at fair value.


⁽⁵⁾	Represents our remaining liability resulting from the transfer of financial assets from our consolidated balance sheets that did not qualify as a sale under the accounting guidance for the transfer of financial instruments.


⁽⁶⁾	Reported amounts include unamortized discounts and premiums, other cost basis adjustments and fair value adjustments of $4.1 billion and $4.8 billion as of December 31, 2014 and 2013, respectively.

Our long-term debt includes a variety of debt types. We issue fixed and floating-rate medium-term notes with maturities greater than one year that are issued through dealer banks. We also offer Benchmark Notes and other bonds in large, regularly-scheduled issuances that provide increased efficiency, liquidity and tradability to the market. Additionally, we have issued notes and bonds denominated in several foreign currencies and are able to issue debt in numerous other currencies. We effectively convert all foreign currency-denominated transactions into U.S. dollars through the use of foreign currency swaps for the purpose of funding our mortgage assets. Our long-term debt also includes Connecticut Avenue Securities (“CAS”), which are credit risk sharing securities that transfer a portion of the credit risk on specified pools of mortgage loans to investors in these securities. See “Note 16, Concentrations of Credit Risk” for additional information regarding CAS.

Our other long-term debt includes callable and non-callable securities, which include all long-term non-Benchmark securities, such as zero-coupon bonds, fixed rate and other long-term securities, and are generally negotiated underwritings with one or more dealers or dealer banks.

Characteristics of Debt

As of December 31, 2014 and 2013, the face amount of our debt securities of Fannie Mae was $464.6 billion and $534.3 billion, respectively. As of December 31, 2014 and 2013, we had zero-coupon debt with a face amount of $116.7 billion and $86.8 billion, respectively, which had an effective interest rate of 0.77% and 1.29%, respectively.

We issue callable debt instruments to manage the duration and prepayment risk of expected cash flows of the mortgage assets we own. Our outstanding debt as of December 31, 2014 and 2013 included $115.0 billion and $168.4 billion, respectively, of callable debt that could be redeemed in whole or in part at our option any time on or after a specified date.

The following table displays the amount of our long-term debt as of December 31, 2014 by year of maturity for each of the years 2015 through 2019 and thereafter. The first column assumes that we pay off this debt at maturity or on the call date if the call has been announced, while the second column assumes that we redeem our callable debt at the next available call date.



	Long-Term Debt by Year of Maturity			Assuming Callable Debt Redeemed at Next Available Call Date
	(Dollars in millions)
2015		$	64,655		$	173,495
2016		59,124			56,851
2017		79,193			52,598
2018		47,452			23,169
2019		32,564			17,964
Thereafter		72,443			31,354
Total debt of Fannie Mae⁽¹⁾		355,431			355,431
Debt of consolidated trusts⁽²⁾		2,760,152			2,760,152
Total long-term debt⁽³⁾		$	3,115,583		$	3,115,583

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⁽¹⁾	Reported amount includes a net unamortized discount, fair value adjustments and other cost basis adjustments of $4.1 billion.


⁽²⁾	Contractual maturity of debt of consolidated trusts is not a reliable indicator of expected maturity because borrowers of the underlying loans generally have the right to prepay their obligations at any time.


⁽³⁾	Includes a portion of structured debt instruments that is reported at fair value.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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