BENCHMARK LENDING, LLC

On Sept. 7, 2008 , the federal government announced that the Federal Housing Finance Agency will place Fannie Mae and Freddie Mac under conservatorship, or federal control.

Under terms of the plan, the Treasury Department will purchase senior-preferred stock in each company as needed to maintain a positive net worth. It will also make available secured short-term debt to Fannie Mae, Freddie Mac and 12 federal home-loan banks as needed as a liquidity backstop, and purchase mortgage-backed securities of the agencies in the open market.

We believe the actions by the

government demonstrate that all necessary steps are being taken to restore confidence in the housing market. These actions should expand the ability of both Fannie Mae and Freddie Mac to make affordable mortgage funding available to future and existing home owners.

• The U.S. Treasury actions are meant to stabilize financial markets, ensure mortgage availability and affordability, and protect the American taxpayer.
• These actions do not have any impact on Central Pacific HomeLoans’ ability to originate new mortgages or service existing mortgages.  Business as usual continues.
• We commend federal policymakers for acting with deliberate speed in addressing the problems of Fannie Mae and Freddie Mac. The fate of these companies has been a significant issue in the mortgage market, and this action should lead to an increased availability of mortgage financing, which will help achieve stability in housing, a critical element in the health of our economy.
• As one of Hawaii’s leading lenders we are pledged to do everything we can to support policymakers’ efforts and keep mortgage money flowing.

What does this mean for Central Pacific HomeLoans?

This action should benefit Central Pacific HomeLoans.  We believe the steps taken by the federal government will assure the continued ability of mortgage issuers to provide homeowners affordable mortgage options, and sell these loans to investors in the

market.

What does this mean for the housing industry?

We believe the actions by the

government demonstrate that all necessary steps are being taken to restore confidence in the housing market. These actions should expand the ability of both Fannie Mae and Freddie Mac to make affordable mortgage funding available to future and existing home owners.

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