Following its downgrade of the U.S.' long-term sovereign credit rating, Standard & Poor's (S&P) has lowered the issue ratings on Fannie Mae and Freddie Mac. The government-sponsored enterprises' (GSEs) ratings have been dropped from AAA to AA+, in line with the broader downgrade given to the U.S. Friday.

S&P has also lowered its issuer credit ratings for 10 of 12 Federal Home Loan Banks (FHLBs) and the senior debt issued by the FHLB System to AA+ from AAA. The ratings on senior debt issued by the Federal Farm Credit Banks have been similarly downgraded.

S&P downgraded Fannie Mae and Freddie Mac because of their direct reliance on the U.S. government. The FHLB and Farm Credit System downgrades reflected the one-notch reduction in the U.S. sovereign rating.

Two FHLBs - those of Chicago and Seattle - were already rated AA+ prior to the U.S. sovereign downgrade, S&P says.

Additionally, the rating agency has lowered the ratings on 126 Federal Deposit Insurance Corp.-guaranteed debt issues from 30 financial institutions under the Temporary Liquidity Guarantee Program, and four National Credit Union Association-guaranteed debt issues from two corporate credit unions under the Temporary Corporate Credit Union Guarantee Program. The debt issues were downgraded from AAA to AA+.