Fannie Mae Redemption

WASHINGTON, June 29, 2011 -

Fannie Mae (OTC Bulletin Board: FNMA) will redeem the principal
amount indicated for the following securities issue on the
redemption date indicated below at a redemption price equal to 100
percent of the principal amount redeemed, plus accrued interest
thereon to the date of redemption:

    Principal    Security   Interest   Maturity     CUSIP     Redemption
      Amount       Type       Rate        Date                  Date

    $100,000,000    MTN      2.750%     July 13,   3136FMH31   July 13,
                                          2015                  2011

Fannie Mae exists to expand affordable housing and bring
global capital to local communities in order to serve the
U.S. housing market. Fannie Mae has a federal charter and
operates in America’s secondary mortgage market to enhance the
liquidity of the mortgage market by providing funds to mortgage
bankers and other lenders so that they may lend to home buyers. Our
job is to help those who house America.

This press release does not
constitute an offer to sell or the solicitation of an offer to buy
securities of Fannie Mae. Nothing in this press release constitutes
advice on the merits of buying or selling a particular investment.
Any investment decision as to any purchase of securities referred
to herein must be made solely on the basis of information contained
in Fannie Mae’s applicable Offering Circular, and that no reliance
may be placed on the completeness or accuracy of the information
contained in this press release.

You should not deal in securities
unless you understand their nature and the extent of your exposure
to risk. You should be satisfied that they are suitable for you in
light of your circumstances and financial position. If you are in
any doubt you should consult an appropriately qualified financial
advisor.

Katherine Constantinou of Fannie Mae, +1-202-752-5403