Freddie Mac · OTC:FMCC
Freddie Mac — Federal Home Loan Mortgage Corp (Fmcc, Fmccg, Fmcci, Fmccj, Fmccl, Fmccn, Fmcco, Fmccs, Fmcct, Fmcki, Fmckl, Fmckn, Frejn, Frejo) — Q1 2011 Earnings Presentation
29 slides from Freddie Mac's earnings presentation, May 4, 2011
Slide 1: First Quarter 2011 Financial Results Supplement
First Quarter 2011 Financial Results Supplement May 4, 2011
Slide 2: Table of contents
Table of contents Freddie B Mac es Fo a. 5. 6. oe . . 10. n 2 1. ue 18 ‘Quarterty Net Income and Comprehensive Income, ‘otal Comprehensive income (Loss) Atributable to Freddie Mac ‘Treasury Draw Requests and Divi Payments ‘Total Equity (Deict and Senior Prefered Stock Activity ‘change in Accumulated
Slide 3: Quarterly net income and comprehensive income
Quarterly net income and comprehensive income Line 2: Provision for credit losses decreased in 1Q 2011 primarily due to a decrease in delinquent loan inflows and a decline in the rate at which delinquent loans ultimately transition to a loss event. Line 4: Derivative gains (losses) for 1Q 2011 refle
Slide 4: Total comprehensive income (loss) attributable to Freddie Mac
Total comprehensive income (loss) attributable to Freddie Mac 1 1 AOCI is the section of the balance sheet where the company records a portion of mark-to-market changes on its available-for-sale (AFS) securities. A B C = A + B
Slide 5: Treasury draw requests and dividend payments
Treasury draw requests and dividend payments 1 Includes the initial liquidation preference of Freddie Mac's senior preferred stock of $1.0 billion. 2 The sum of quarterly dividends does not equal the cumulative total due to rounding. 3 Consists of requested Treasury draw of $13.8 billion for 3Q 2008
Slide 6: Total equity (deficit) and Senior Preferred Stock activity
Total equity (deficit) and Senior Preferred Stock activity 1 On January 1, 2010, the company adopted amendments to the accounting guidance related to transfers of financial assets and consolidation of variable interest entities (VIEs). The cumulative effect of these changes in accounting principles
Slide 7: Change in accumulated other comprehensive income
Change in accumulated other comprehensive income 1 Includes $10.7 billion and $10.0 billion of non-credit-related other-than-temporary impairments, net of taxes, at December 31, 2010 and March 31, 2011, respectively. 2 At December 31, 2010 and March 31, 2011, all available-for-sale securities were m
Slide 8: Loan loss reserves
Loan loss reserves 1 1, 2 4 1 Includes allowance for loan losses and reserve for guarantee losses. 2 Includes an out-of-period adjustment which resulted in a pre-tax $1.3 billion increase in the company's provision for credit losses in the second quarter of 2010. For further details related to the o
Slide 9: Real estate owned
Real estate owned1 Property Inventory 1Q 2011 Activity Geographic Distribution2 Based on Property Inventory Historical Trend Ending Property Inventory 1 Includes single-family and multifamily REO. 2 Region designation: West (AK, AZ, CA, GU, HI, ID, MT, NV, OR, UT, WA); Northeast (CT, DE, DC, MA, ME,
Slide 10: Single-family loan workouts
Loan modifications Forbearance agreements Short sales and deed-in-lieu transactions Single-family loan workouts 1 Loan modifications involve adding outstanding indebtedness, such as delinquent interest, to the unpaid principal balance of the loan or changing other terms of a mortgage. Represents the
Slide 11: Single-family loan modifications
Single-family loan modifications 1 Includes completed loan modifications under HAMP. Excludes those loan modification activities for which the borrower has started the required process, but the modification has not been made permanent, or effective, such as loans in the trial period under HAMP. 16k
Slide 12: Reperformance Rates of Single-family Loan Modifications
Reperformance Rates of Single-family Loan Modifications (HAMP and non-HAMP) 1 Reperformance rates Of the loans modified in 2Q 2009, 56% were current or less than 3 months past due 21 to 23 months post modification. Of the loans modified in 4Q 2010, 94% were current or less than 3 months past due 3 t
Slide 13: Outstanding repurchase requests to seller/servicers
The UPB of outstanding repurchase requests issued to our single-family seller/servicers declined from $3.8 billion as of December 31, 2010 to $3.4 billion as of March 31, 2011.2 1 Freddie Mac's contracts require that a seller/servicer repurchase a mortgage after a repurchase request has been issued,
Slide 14: Administrative expenses and efficiency
Administrative expenses and efficiency1,2 1 Administrative expenses, expressed as a percentage of the average total mortgage portfolio. Basis points for the quarters are calculated on an annualized basis. 2 In 1Q 2011, the company reclassified certain expenses from Other expenses to Professional ser
Slide 15: Purchase Agreement portfolio limits
Purchase Agreement portfolio limits1 Indebtedness 1,3 ($ Billions) Mortgage Assets 1,2 ($ Billions) 1 The company's Purchase Agreement with Treasury limits the amount of mortgage assets the company can own and indebtedness it can incur. Under the Purchase Agreement, mortgage assets and indebtedness
Slide 16: Credit Supplement
Freddi Bvisc Credit Supplement
Slide 17: National home prices cumulative decline of 27% since June 2006
National home prices have experienced a cumulative decline of 27% since June 20061 1 National home prices use the internal Freddie Mac index, which is value-weighted based on Freddie Mac's single-family credit guarantee portfolio. The U.S. index is a monthly series; quarterly growth rates are calcul
Slide 18: Home price performance by state
Home price performance by state June 2006 to March 2011 -2% -15% -12% -50% -45% -17% RI -30% CT -21% DC -8% -20% -49% -31% -22% -7% -34% -26% -12% -8% -5% -6% -31% -17% -41% -31% -19% -11% -13% -15% 11% -7% -26% -23% -12% -59% -13% -22% -4% -32% -13% -12% -1% -11% 0% -20% -25% -9% -24% -21% -3% -6%
Slide 19: Mortgage market and Freddie Mac serious delinquency rates
1 Source: National Delinquency Survey from the Mortgage Bankers Association. Categories represent first lien single-family loans. Data is not yet available for the first quarter of 2011. 2 See "MD&A - RISK MANAGEMENT - Credit Risk - Mortgage Credit Risk - Credit Performance - Delinquencies" in Fredd
Slide 20: Loan purpose of single-family credit guarantee portfolio purchases
85% Loan purpose of single-family credit guarantee portfolio purchases 1 The relief refinance mortgage initiative is Freddie Mac's implementation of the Home Affordable Refinance Program. Under the program, the company allows eligible borrowers who have mortgages with high current LTV ratios to refi
Slide 21: Credit quality of single-family credit guarantee portfolio purchases
Credit quality of single-family credit guarantee portfolio purchases1 Weighted Average Original LTV Ratio 2 of Single-family Mortgage Loans Purchased Weighted Average Credit Score3 of Single-family Mortgage Loans Purchased 1 Beginning in 2009, purchases exclude mortgage loans acquired under the Fred
Slide 22: Single-family credit statistics
Single-family credit statistics 1 Calculated as annualized credit losses divided by the average total single-family credit guarantee portfolio. 2 Consists of the unpaid principal balance of the single-family credit guarantee portfolio and the net carrying value of single-family REO balances shown on
Slide 23: Single-family 1Q 2011 credit losses & REO by region and state
Single-family 1Q 2011 credit losses & REO by region and state 1 Based on the unpaid principal balance (UPB) of the single-family credit guarantee portfolio. 2 UPB amounts exclude Other Guarantee Transactions with ending balances of $752 million since these securities are backed by non-Freddie Mac is
Slide 24: Single-family credit guarantee portfolio characteristics
Single-family credit guarantee portfolio characteristics1 1 Portfolio characteristics are based on the unpaid principal balance (UPB) of the single-family credit guarantee portfolio. Approximately $2 billion in UPB for Other Guaranteed Transactions is included in total UPB and percentage seriously d
Slide 25: Single-family credit profile by book year and product feature
Single-family credit profile by book year and product feature1 1 Portfolio characteristics are based on the unpaid principal balance (UPB) of the single-family credit guarantee portfolio. Approximately $2 billion in unpaid principal balance for Other Guaranteed Transactions is included in total UPB
Slide 26: Cumulative foreclosure transfer and short sale rates by book year
Single-family cumulative foreclosure transfer and short sale rates1 by book year 1 Rates are calculated for each year of origination as the number of loans that have proceeded to foreclosure transfer or short sale and resulted in a credit loss, excluding any subsequent recoveries, divided by the num
Slide 27: Multifamily mortgage portfolio by attribute
Multifamily mortgage portfolio by attribute1 1 Based on the unpaid principal balance (UPB) of the multifamily mortgage portfolio. 2 Based on the UPB of mortgages two monthly payments or more past due or in foreclosure. Freddie Mac revised its 2010 delinquency rates to exclude multifamily borrowers w
Slide 28: Multifamily mortgage portfolio by attribute, continued
Multifamily mortgage portfolio by attribute, continued1 1 Based on the unpaid principal balance (UPB) of the multifamily mortgage portfolio. 2 Based on the UPB of mortgages two monthly payments or more past due or in foreclosure. 3 DSCR - Debt Service Coverage Ratio - is an indicator of future credi
Slide 29: Safe Harbor Statements
Safe Harbor Statements Freddie Mac obligations Freddie Mac's securities are obligations of Freddie Mac only. The securities, including any interest or return of discount on the securities, are not guaranteed by and are not debts or obligations of the United States or any federal agency or instrument