Fannie Mae and Freddie Mac may have their AAA ratings lowered by Standard & Poor’s Ratings Services because of their dependence on the U.S. government, which is under review for a possible cut. S&P also placed select AAA-rated Federal Home Loan Banks and 126 debt issues guaranteed by the Federal Deposit Insurance Corp. on Creditwatch negative, meaning there’s a one-in-two chance they may be cut in the next 90 days, the ratings firm said today in a statement.
S&P reduced the outlook on the U.S. rating to negative from stable on April 18. The U.S. may have its AAA long-term rating lowered if S&P concludes Congress and President Barack Obama’s administration haven’t achieved a credible solution to the rising U.S. government debt burden and aren’t likely to achieve one in the foreseeable future, the firm said July 14.
