Edgar Filing: FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE

Ownership Submission

FORM 4

Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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3235-0287

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(Print or Type Responses)

1. Name and Address of Reporting Person ^*

WILLIAMS MICHAEL J

2. Issuer Name and Ticker or Trading Symbol
FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE [FNM]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

_____ Director	_____ 10% Owner
__X__ Officer (give title below)	_____ Other (specify below)
EVP & COO

(Last)

(First)

(Middle)

3900 WISCONSIN AVENUE, NW

3. Date of Earliest Transaction (Month/Day/Year)
10/17/2006

(Street)

WASHINGTON, DC 20016

4. If Amendment, Date Original Filed(Month/Day/Year)

6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person

(City)

(State)

(Zip)

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned

1.Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1.Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	04/20/2005		G⁽¹⁾		6,000	A	$ 0	157,393.095	D
Common Stock	10/17/2006		M		13,310 ⁽²⁾	A	$ 39.44	170,703.095	D
Common Stock	10/17/2006		F		10,951 ⁽³⁾	D	$ 57.91	159,752.095 ⁽⁴⁾ ⁽⁵⁾ ⁽⁶⁾	D
Common Stock								846.747 ⁽⁷⁾	I	By ESOP
Common Stock								700 ⁽⁸⁾	I	By Reporting Person as UGMA custodian for daughter

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)

1. Title of Derivative Security
(Instr. 3)

2. Conversion or Exercise Price of Derivative Security

3. Transaction Date (Month/Day/Year)

3A. Deemed Execution Date, if any (Month/Day/Year)

4. Transaction Code
(Instr. 8)

5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)

6. Date Exercisable and Expiration Date
(Month/Day/Year)

7. Title and Amount of Underlying Securities
(Instr. 3 and 4)

8. Price of Derivative Security
(Instr. 5)

9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)

10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)

11. Nature of Indirect Beneficial Ownership
(Instr. 4)

Code

(A)

(D)

Date Exercisable

Expiration Date

Title

Amount or Number of Shares

Employee Stock Option (right to buy)

$ 39.44

10/17/2006

13,310

11/19/1997

11/19/2006

Common Stock

13,310

$ 0

Reporting Owners

Reporting Owner Name / Address	Relationships
Reporting Owner Name / Address	Director	10% Owner	Officer	Other
WILLIAMS MICHAEL J 3900 WISCONSIN AVENUE, NW WASHINGTON, DC 20016			EVP & COO

Signatures

/s/ Michael J. Williams		10/19/2006
^**Signature of Reporting Person		Date

Explanation of Responses:

*	If the form is filed by more than one reporting person, see Instruction 4(b)(v).
**	Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1)	The reported transaction represents a transfer of shares held by the reporting person's spouse into an account held jointly with the resporting person.
(2)	These shares were received upon the exercise of employee stock options due to expire in November 2006.
(3)	These shares were withheld by Fannie Mae for payment of the exercise price and tax liability upon the reporting person's stock option exercise.
(4)	Under Fannie Mae's Performance Share Program, as a member of Fannie Mae's senior management, the reporting person has previously received awards that entitle the reporting person to receive shares of Fannie Mae common stock in an amount based upon and subject to Fannie Mae's meeting corporate performance objectives over three-year periods. Generally, Fannie Mae's Compensation Committee determines in January of the year following completion of the cycle the number of shares of common stock each awardee is entitled to receive, and the shares are paid out in two equal annual installments beginning that January. (Footnote 4 is continued in 5 below.)
(5)	For the three-year performance cycle completed in 2003, the reporting person was determined in January 2004 to be entitled to receive 23,850 shares, of which the reporting person received 11,925 shares in accordance with the program and the balance was scheduled to be received in January 2005. As previously announced, Fannie Mae's Board of Directors and Compensation Committee have determined to defer payment of unpaid performance shares for the performance cycle completed in 2003 until reliable financial data for the relevant period are available. As a result, 11,925 shares scheduled to be issued to the reporting person in January 2005 have not yet been issued. These shares are included in the reporting person's total holdings above.
(6)	End of period holdings include additional shares acquired under the Issuer's dividend reinvestment plan through August 25, 2006.
(7)	End of period holdings include additional shares acquired from the reinvestment of dividends in issuer's ESOP through August 25, 2006.
(8)	The reporting person no longer has a reportable beneficial ownership interest in 700 shares of the Issuer's common stock owned by his other daughter and included in the reporting person's prior ownership reports.

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