Fannie Mae, Freddie Mac MBS, debt spreads balloon

NEW YORK, March 6 (Reuters) - Mortgage-backed and corporate "agency" debt obligations issued by Fannie Mae and Freddie Mac plunged relative to U.S. government securities on Thursday as the credit crisis sent money managers racing to raise cash.

Yields on Fannie Mae mortgage-backed securities paying 5.5 percent interest jumped by 10 basis points to 2.23 percentage points above benchmark Treasuries, the most in more than two decades, according to Reuters and traders' data. The spread has widened for a fifth day, and are out from 1.51 points at the start of the year.

The agency debt issued by Fannie Mae to fund its mortgage investments also widened. Yield spreads on the most recently issued five-year benchmark issue of Fannie Mae widened by 11.5 basis points to a record 111 basis points, according to the bid quoted by broker GovPX/Garban-ICAP. (Reporting by Al Yoon; Editing by Theodore d'Afflisio)