Federal Housing Finance Agency Print



A Uniform Rating System

FHFA's examiners use a uniform rating system for Fannie Mae and Freddie Mac and the Federal Home Loan Banks.

The examiners employ a risk-focused rating system under which each regulated entity and the Office of Finance is assigned a common composite rating based on an evaluation of various aspects of its operations.

Specifically, the composite rating of a federal home loan bank, Fannie Mae or Freddie Mac is based on an evaluation and rating of seven components:


​Sufficiency of capital relative to Fannie Mae's, Freddie Mac's or the federal home loan bank's risk profile.

​Asset Quality

​Credit risk associated with assets and off-balance sheet transactions, and management's ability to identify, measure, monitor, and control credit risk.


​Capability and willingness of board and management to identify, measure, monitor and control the risks of Fannie Mae, Freddie Mac or the home loan bank.


​Quantity, trend, sustainability, and quality of earnings.


​Current level and prospective sources of liquidity compared to funding needs, and adequacy of funds management practices.

​Sensitivity to Market Risk

​Degree to which changes interest rates, foreign exchange rates, commodity prices, or equity prices can adversely affect Fannie Mae's, Freddie Mac's or the home loan bank's earnings or economic capital.

​Operational Risk

​Exposure to loss from inadequate or failed internal processes, people, and systems.


CAMELSO is unique to FHFA

The above seven criteria together are known as the CAMELSO Component Assessment that is unique to FHFA.

The composite rating of the Office of Finance is based primarily on an evaluation of two components: management and operational risk.


Examiners Determine an Overall Rating

Under the rating system, Fannie Mae, Freddie Mac, and each of the home loan banks are each assigned a composite rating from 1 (best - the lowest degree of supervisory concern) to 5 (worst - the highest level of supervisory concern).  The composite rating reflects the ratings of each of the seven CAMELSO categories, which are also each rated on a scale of 1 to 5.

The composite rating is not a arithmetic average of the component ratings. Instead, the relative importance of each component is determined on a case-by-case basis, within parameters established by this rating system.

© 2024 Federal Housing Finance Agency