Fannie Mae, Freddie Mac credit spreads tighten

NEW YORK, April 1 (Reuters) - The cost of protecting debt of Fannie Mae (FNM.N: Quote, Profile, Research) and Freddie Mac (FRE.N: Quote, Profile, Research) with credit default swaps tumbled on Tuesday after strong demand for a share offering by Lehman Brothers (LEH.N: Quote, Profile, Research) lifted sentiment in the financial sector.

Five-year credit protection costs on Fannie Mae fell by 9 basis points to about 43.5 basis points, or $43,500 a year to protect $10 million of debt, while Freddie Mac's protection costs fell by about 8.5 basis points to about 43.5 basis points. For details see [ID:nN01215030].

(Reporting by Dena Aubin, Editing by Chizu Nomiyama)