Call Us: 800-836-8240 FIXED INCOME RETIREMENT PLANNING OTHER SERVICES Agency Debt Government Sponsored Enterprises (GSEs): Federal Farm Credit Bank, Federal Home Loan Bank System, Federal Home Loan Mortgage Corporation (Freddie Mac), Federal National Mortgage Association (Fannie Mae) and Student Loan Marketing Association (Sallie Mae). What Are Government Sponsored Enterprises (GSEs)? Government Sponsored Enterprises, known as GSEs, are privately owned corporations created by Congress to provide funding to help reduce the cost of capital for certain borrowing sectors of the economy such as homeowners, students, and farmers. GSE securities are perceived to carry the implicit backing of the U.S. Government, but they are not direct obligations of the U.S. Government. Note: GSEs are commonly referred to as “Agencies”, however there is a difference between Government Sponsored Enterprises and a Government Agency. An example of a Government Agency is the “Government National Mortgage Association (GNMA)” which has the full backing of the U.S. Government. Secondary Markets GSEs are most suitable for purchasing and holding to maturity. However, if investors find it necessary to sell their holding prior to maturity, GSE obligations are traded on the secondary market at prevailing market prices, which may be more or less than the original amount invested. In some cases, liquidity may be limited due to market conditions. Credit Quality GSE debt is generally considered to be of high credit quality due to the implied backing of the U.S. Government, but ultimately it is the sole obligation of its issuer. For that reason, GSEs are considered to carry somewhat greater risk than securities issued by the U.S. Treasury or Government Agencies that carry the full faith and credit of the U.S. Government. Tax Status of GSEs The interest income of GSEs is subject to federal income taxes. To learn more about how GSEs can play a strategic part of your portfolio, contact us. Share on Social Media: Free Offers & Services Bond Inventory VIEW OUR INVENTORY Market Outlook Request your Free Market Outlook today! Learn More Bond Guide Get a Free Bond Guide today! Learn More Home About H&W Tax Free Municipal Bonds Portfolio Management Other Financial Services Clients Account Login H&W Trending Careers Contact Us Forms & Agreements Security Center Business Continuity Order Routing Form CRS Do Not Call Registry SIPC & Excess Protection Privacy Policy Site Map Headquarters: Hennion & Walsh, Inc. 2001 Route 46 Waterview Plaza Parsippany, NJ 07054 Florida Office: Hennion & Walsh, Inc. 777 Yamato Road Boca Colonnade I Suite 500 Boca Raton, FL 33431 Get Connected: © 2021 Hennion&Walsh, All Rights Reserved // Securities offered through Hennion & Walsh Inc. member of FINRA, SIPC.