This Pricing Supplement relates to the Debt Securities described below and should be read in conjunction with the Offering Circular dated January 6, 1997 and a Supplement thereto dated August 12, 1997 (collectively, the "Offering Circular") relating to the Global Debt Facility of the Federal National Mortgage Association ("Fannie Mae" or the "Corporation"). Unless otherwise defined herein, capitalized terms used herein have the meanings given to them in the Offering Circular.
THE DEBT SECURITIES, TOGETHER WITH INTEREST THEREON, ARE NOT GUARANTEED BY THE UNITED STATES AND DO NOT CONSTITUTE A DEBT OR OBLIGATION OF THE UNITED STATES OR OF ANY AGENCY OR INSTRUMENTALITY THEREOF OTHER THAN THE CORPORATION.
Certain Securities Terms
1. Title: 10.50% Notes Due January 21, 2003
2. Form
Book-Entry
X Global
DTC Global Securities
X Other Global Securities
3. Specified Payment Currency
a. Interest: Hong Kong Dollars
b. Principal: Hong Kong Dollars
4. Aggregate Original Principal Amount: 300,000,000 Hong Kong Dollars
5. Issue Date: January 23, 1998
6. Maturity Date: January 21, 2003
a. Amount Payable on the Maturity Date
X Fixed Principal Repayment Amount
X 100% of principal amount
___% of principal amount
Variable Principal Repayment Amount
7. Subject to Redemption Prior to Maturity Date
X No
Yes
8. Interest Category
X Fixed Rate Securities
Step Rate Securities
Variable Rate Securities
Fixed/Variable Rate Securities
Zero-Coupon Securities
9. Interest
a. Frequency of Interest Payments
Annually
X Semiannually
Quarterly
Monthly
Other: ____________
b. Interest Payment Dates: January 21 and July 21 of each year, commencing July 21, 1998
c. Interest rate per annum: 10.50%
d. Accrual Method: Interest will be calculated on the basis of the actual number of days elapsed in a year of 365 days, regardless of whether accrual or payment occurs in a leap year. The foregoing supersedes and replaces the second sentence in the paragraph under "Description of the Debt Securities -- Provisions Relating to All Debt Securities -- Interest -- Fixed Rate Securities" in the Offering Circular.
10. Authorized Denominations (if other than minimum denominations of U.S. $10,000 and additional increments of U.S. $1,000)
a. Minimum Denominations: 1,000,000 Hong Kong Dollars
b. Additional Increments: 1,000,000 Hong Kong Dollars
11. Principal Financial Center
For the Securities, "Principal Financial Center" means Hong Kong.
Additional Information Relating to the Securities
1. Identification Number(s)
a. CUSIP: U31356AL9
b. ISIN: XS008370320-6
c. Common Code: 8370320
d. Other: N/A
2. Listing Application
X No
Yes
Luxembourg
Other: _____________
3. Additional Tax Information: See Annex 1
Offering
1. Pricing Date: January 7, 1998
2. Method of Distribution: X Principal Agent
3. Applicable Dealer Underwriting Commitment
Deutsche Bank AG, Singapore Branch . . . . .300,000,000 Hong Kong Dollars
4. Offering Price:
X Fixed Offering Price: 100.00%, plus accrued interest, if any, from the Issue Date
Variable Price Offering
5. Purchase Price to Applicable Dealer(s): 99.75% of Principal Amount
a. Concession: N/A
b. Reallowance: N/A
Settlement
1. Settlement Date: January 23, 1998, 9:00 a.m. New York City time
2. Settlement Basis
Delivery versus payment
X Free delivery
3. Settlement Clearing System
U.S. Federal Reserve Banks
DTC
X Euroclear
Cedel
Other: _____________
ANNEX 1
TO PRICING SUPPLEMENT DATED JANUARY 15, 1998
RELATING TO:
Issue (Title): 10.50% Notes Due January 21, 2003
In the opinion of Arnold & Porter, special tax counsel to the Corporation, the following paragraphs, when read in conjunction with the discussions under "United States Taxation" in the Offering Circular dated January 6, 1997 and in the Supplement thereto dated August 12, 1997, correctly describe the principal aspects of the current United States federal tax treatment of investors who purchase the Debt Securities described in the Offering Circular. The discussions do not purport to deal with all tax consequences applicable to all categories of investors, some of which may be subject to special rules.
Final Regulations Relating to Withholding and Information Reporting
The Offering Circular describes proposed regulations issued by the IRS relating to withholding, backup withholding and information reporting with respect to payments made to Non-U.S. Persons. In October 1997, the IRS finalized those regulations. Those final regulations generally are effective for payments made after December 31, 1998. However, withholding certificates that are valid under the present rules and that are held by a Withholding Agent on December 31, 1998, remain valid until the earlier of December 31, 1999 or the expiration date of the certificate under the present rules (unless otherwise invalidated due to changes in the circumstances of the person whose name is on the certificate).
When effective, the new regulations will streamline and, in some cases, alter the types of statements and information that must be furnished to a Withholding Agent to claim a reduced rate of withholding. While various IRS forms (such as IRS Forms 1001 and 4224) currently are used to claim exemption from withholding or a reduced withholding rate, the preamble to the regulations states that the IRS intends most certifications to be made on revised Forms W-8. The regulations also clarify the duties of Withholding Agents and modify the rules concerning withholding on payments made to Non-U.S. Persons through foreign intermediaries. With some exceptions, the new regulations treat a payment to a foreign partnership as a payment directly to the partners.