April 14 (Bloomberg) -- The possible need to provide financial support to government-sponsored enterprises that deal in mortgage debt poses a greater threat to the AAA credit rating of the U.S. than bailouts of securities firms, according to Standard & Poor's Ratings Services.

The maximum potential cost of assisting broker-dealers in a prolonged recession is less than 3 percent of gross domestic product, compared with as much as 10 percent to agencies such as Freddie Mac, Fannie Mae and Federal Home Loan Banks, the credit- ratings company said in a statement today. Damage to the U.S. rating from the agencies is unlikely, S&P said.

``Standard & Poor's does not predict a deep recession,'' said John B. Chambers, chairman of the New York-based firm's sovereign rating committee. ``However, under such a scenario, the size of GSEs, coupled with their current level of common equity, could create a material fiscal burden to the government that would lead to downward pressure on its rating.''

Fannie Mae and Freddie Mac agreed on March 19 to expand their purchases of U.S. mortgages and related securities after the Bush administration reduced the amount of capital the companies are required to hold as a cushion against losses. The agencies also pledged to raise as much as $20 billion in capital as part of an agreement.

The Federal Reserve promised $30 billion last month to back JPMorgan Chase & Co.'s bailout of Bear Stearns Cos., preventing the biggest collapse of an investment bank. The central bank lowered its pledge to $29 billion on March 24 after JPMorgan quadrupled the purchase price to about $2.4 billion.

To contact the reporter on this story: Liz Capo McCormick in New York at Emccormick7@bloomberg.net

Last Updated: April 14, 2008 13:52 EDT