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SHAREHOLDER ALERT: Pomerantz Law Firm Reminds Shareholders With Losses on Their Investment in Junior Preferred Share of Fannie



SHAREHOLDER ALERT: Pomerantz Law Firm Reminds Shareholders With Losses on
Their Investment in Junior Preferred Share of Fannie Mae and Freddie Mac of
Class Action Lawsuit and Upcoming Deadline

NEW YORK, Aug. 30, 2013 (GLOBE NEWSWIRE) -- Pomerantz Grossman Hufford
Dahlstrom & Gross LLP has filed a class action in United States Court of
Federal Claims, docketed under 13-cv-00496-MMS, on behalf of a class
consisting of all persons or entities who purchased or otherwise held shares
of Federal National Mortgage Association ("Fannie Mae") and/or Federal Home
Loan Mortgage Corporation ("Freddie Mac") Junior Preferred Stock prior to, and
as of August 17, 2012 all dates inclusive (the "Class Period"). This class
action seeks to recover damages against the Government of The United States of
America for just compensation for violation of the Fifth Amendment of the U.S.
constitution. The Complaint alleges that the Government, by imposing the Net
Worth Sweep, took Plaintiff's and Class' vested property rights without just
compensation.

If you are a shareholder who purchased shares of Fannie Mae or Freddie Mac
Junior Preferred securities during the Class Period, please contact Robert S.
Willoughby at rswilloughby@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll
free, x237. Those who inquire by e-mail are encouraged to include their
mailing address, telephone number, and number of shares purchased.

The Complaint alleges that in September of 2008, the Government (acting
through the FHFA) placed Fannie Mae and Freddie Mac into conservatorship,
putting it under the control of the FHFA, which is an agency of the
Government.

In connection with the conservatorships, the Government (specifically, the
U.S. Treasury) entered into substantially identical Preferred Stock Purchase
Agreements (the "Agreements") with both Fannie Mae and Freddie Mac. Under
these Agreements, the Treasury acquired from each company preferred stock (the
"Senior Preferred Stock") that (i) is senior in priority to all other series
of Fannie Mae and Freddie Mac preferred stock (all such other series of Fannie
and Freddie preferred stock shall be referred to as the "Junior Preferred
Stock"), (ii) was given an initial face value of $1 billion, but also provided
that this face value would be increased by any amount the Treasury invested in
or advanced to Fannie Mae or Freddie Mac, (iii) would receive preferential
liquidation rights (i.e., would receive face value, as increased by any
Treasury investments or advances, as a liquidation preference prior to any
monies going to the holders of Junior Preferred Stock or Common Stock), and
(iv) would earn an annual dividend of 10% of the face value (as increased by
any Treasury investments or advances). In addition, each of the Agreements
provided the Treasury with warrants that could be exercised at any time to
allow the Treasury to acquire 79.9% of the Common Stock of Fannie and Freddie,
respectively, for a nominal price.

Between the start of the conservatorship in September 2008 through the
beginning of 2012, the Government advanced Fannie Mae and Freddie Mac more
than $188 billion-most of which was advanced to cover accounting losses
reflecting excessive write-downs of assets that have turned out to be worth
far more than their written down amounts. These advances increased the face
value of the Senior Preferred Stock held by the Government to approximately
$189 billion, entitling the Government to an annual dividend of approximately
$19 billion, which translates to a quarterly dividend of just under $5
billion.

By 2012, the housing market was well on its way to recovery and Fannie Mae and
Freddie Mac had become profitable again, reporting increasing profits through
2011 and 2012. Indeed, by the second quarter of 2012, Fannie and Freddie made
a combined quarterly profit of approximately $8.3 billion. This was the first
quarter for which Fannie and Freddie reported a combined quarterly profit that
exceeded the just under $5 billion quarterly dividend payable to the Treasury
on its Senior Preferred Stock. Thus, by no later than the end of the second
quarter of 2012, Fannie and Freddie were generating sufficient profits to pay
a dividend to the holders of their Junior Preferred Stock (or to payout in a
liquidation distribution, in the event of any liquidation, dissolution, or
winding up of Fannie or Freddie). However, on August 17, 2012, the Government
unilaterally amended the terms of its Agreements with Fannie Mae and Freddie
Mac, and mandated that, beginning on January 1, 2013, Fannie Mae and Freddie
Mac would have to pay the Government dividends equal to their entire net worth
(the "Net Worth Sweep"), leaving Fannie Mae and Freddie Mac with no funds to
redeem the Government's Senior Preferred Stock or to distribute to the holders
of Junior Preferred Stock, whether by dividend, redemption, or in a
liquidation. The Government's August 2012 action appropriated the valuable
contractual and property rights owned by the holders of Junior Preferred Stock
for no consideration.

The Pomerantz Firm, with offices in New York, Chicago, Florida, and San Diego,
is acknowledged as one of the premier firms in the areas of corporate,
securities, and antitrust class litigation. Founded by the late Abraham L.
Pomerantz, known as the dean of the class action bar, the Pomerantz Firm
pioneered the field of securities class actions. Today, more than 70 years
later, the Pomerantz Firm continues in the tradition he established, fighting
for the rights of the victims of securities fraud, breaches of fiduciary duty,
and corporate misconduct. The Firm has recovered numerous multimillion-dollar
damages awards on behalf of class members. See www.pomerantzlaw.com.

CONTACT: Robert S. Willoughby
         Pomerantz Grossman Hufford Dahlstrom & Gross LLP
         rswilloughby@pomlaw.com
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