Update to LIBOR Determinations for Certain Single-Family REMIC Securities

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Update to LIBOR Determinations for Certain Single-Family REMIC Securities 

Certain Fannie Mae Single-Family REMIC securities currently accrue monthly interest based on the London interbank offered rate (LIBOR) where LIBOR is calculated using the “LIBO Method.”  The LIBO Method uses individual London bank quotations for one-month U.S. dollar deposits that are submitted to the British Bankers’ Association (BBA) for purposes of determining LIBOR.  See the Prospectus for Fannie Mae Guaranteed REMIC Pass-Through Certificates dated August 1, 2012 (the REMIC Prospectus) for a more complete description of the LIBO Method. 

On June 12, 2013, the BBA announced that, starting on July 1, 2013, the individual London bank quotations would be embargoed and subject to a three month publication delay.  However, the daily publication by the BBA of the final LIBOR rates (which are derived from the individual London banks’ daily quotations) will not be affected.  Due to the changes announced by the BBA, Fannie Mae has determined that it is currently not feasible to use the LIBO Method for purposes of calculating LIBOR.  As a result, for accrual periods beginning on or after July 17, 2013, Fannie Mae will calculate LIBOR for the affected REMIC securities using the BBA Method described in the REMIC Prospectus. 

A complete listing of the REMIC securities affected by the BBA announcement is available. 

The Floater Reset Disclosure files will reflect the use of the BBA Method for calculating LIBOR for the affected REMIC securities.  For specifics on the indices affected, see the Monthly Floater Resets page.

Investors may contact Fixed-Income Securities Helpline by email or at 1-800-BEST-MBS (1-800-237-8627) with questions about this announcement.

Originally published: 07/12/13