Ace the SIE Exam 2025 – Unlock Your Finance Future with Essentials!

A government sponsored enterprise, or GSE, is a financial services corporation created by the United States Congress to enhance the flow of credit to targeted sectors of the economy and to make those segments of the capital market more efficient and transparent. The Federal National Mortgage Association, also known as Fannie Mae, is one of the largest GSEs, and is responsible for providing liquidity to the mortgage market. The other options listed are not government sponsored enterprises. The Federal Deposit Insurance Corporation (FDIC) is an independent federal agency that protects depositors against the loss of their insured deposits if an FDIC-insured bank or savings association fails. The Securities Exchange Commission (SEC) is a government agency responsible for regulating the securities industry, including the stock market. The Federal Reserve System is the central banking system of the United States and is responsible for conducting monetary policy, regulating and supervising banks, and providing services to financial institutions and the government. Although all of these organizations play important roles in the financial sector, the Federal National Mortgage Association (Fannie Mae) is the only one officially designated as a government sponsored enterprise.