The Honorable Mel Martinez Secretary U.S. Department of Housing and Urban Development Washington, DC  20410 Dear Mr. Secretary: I am pleased to present to you the Annual Report and the audited financial statements of the Government National Mortgage Association (Ginnie Mae) for the fiscal year ended September 30, 2001.  Ginnie Mae, once again, received an unqualified opinion from its inde- pendent auditors, KPMG LLP, with no findings of material weaknesses or reportable conditions. Ginnie Mae continues to be a strong and integral part of the Department. During Fiscal Year 2001, Ginnie Mae reached approximately $1.8 trillion in original issues of mortgage-backed securities guaranteed since 1970.  We are quite proud of our continuing accomplishments and our important role in helping to meet HUD’s commitment to support affordable homeownership for low- and moderate-income families in America.  Our role in the secondary mortgage market provides an important public benefit to Americans fulfilling their dream of homeownership, regardless of economic conditions. Ginnie Mae’s strong financial performance continued in Fiscal Year 2001.  Operating results for the year exceeded historic performance levels.  Our mortgage-backed securities outstanding totaled $604.3 billion in Fiscal Year 2001, approximately the same as last fiscal year.  Ginnie Mae’s net revenues were $805.3 million in Fiscal Year 2001, a 6 percent increase – and a record – as compared to $762.8 million in Fiscal Year 2000.  Ginnie Mae’s mortgage-backed securities pro- gram guaranteed the issuance of $153.8 billion in mortgage-backed securities last year, thereby providing capital for the purchase or refinance of approximately 1.3 million homes, including multifamily units.  We are extremely proud that, over its lifetime, Ginnie Mae’s mortgage-backed securities have financed homeownership opportunities for 26.8 million American families. Ginnie Mae’s excellent performance over many years is a fundamental indicator of our ability to manage risk and increase stability in the marketplace. Ginnie Mae’s commitment to our issuers, the marketplace, and the community was evident in our response to the events of September 11, 2001.  Our staff worked diligently following the attacks in providing uninterrupted service to the mortgage industry.  Ginnie Mae activated its Continuity of Operations Plan (COOP) on September 11, 2001.  Ginnie Mae successfully sus- tained all business operations throughout the tragic events.  In addition, within days of the attacks, we were working on a plan to provide assistance: reimbursement to issuers for interest 3 G i n n i e   M a e   A n n u a l   R e p o r t   2 0 0 1