The Russian Federation Ministry of Finances made an official statement regarding Fannie Mae & Freddie Mac’s plummeting stock prices.

‘The current regulations on the management of the country’s Reserve Fund and the National Welfare Fund prevent us from investing their resources in these mortgage lending agencies’ bonds. The liabilities of the U.S. agencies accountable to the state are partially used by the Bank of Russia to deal with the forex/gold holdings. The management of these holdings is closely monitored by the National Banking Council, consisting of Members of Government, the Administration of the President, the Soviet of the Federation, and the State Duma,’ the Ministry reports.

The National Banking Council, assisted by PriceWaterhouseCoopers Audit, assessed and approved of the Bank of Russia’s annual report for 2007 and considered the data on the bank’s performance in the first quarter of 2008 (including the management of foreign exchange and gold holdings) on July 10, 2008.

‘Unlike their stock prices, Fannie Mae and Freddie Mac’s debt securities quotations have remained quite stable. This has to do with the fact that the U.S. Government has openly expressed its willingness to support these agencies financially. Fannie and Freddie’s liabilities can therefore still boast the highest credit rating that meets the requirements of forex/gold holdings investors,’ the statement says.