Fannie Mae priced its fourth, and largest, credit risk sharing transaction under its Connecticut Avenue Securities at significantly wider spreads that its previous deal, completed in May, suggesting that the market has have  found an equilibrium.

In the two previous transactions, spreads tightened, but some of the earlier scarcity premium may have been eliminated, according to Laurel Davis, Fannie's vice president for credit risk transfer. "I don’t know we expected to hit that equilibrium so quickly, but the fact that there are lot of securities out there, that we have issuance on a regular basis, and the securities trade very transparently on TRACE … has led to them becoming a benchmark," she said.

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