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) — Q3 2009 Earnings Presentation
23 slides from Freddie Mac's earnings presentation, Nov 6, 2009
Slide 1: Third Quarter 2009 Financial Results Supplement
Third Quarter 2009 Financial Results Supplement November 6, 2009
Slide 2: Table of contents
Bins eae 2a Table of contents 2 GAAP Financial Results 42 National Home Prices 4 Total Equity and Purchase Agreement wth Treasury 13 State by State Home Prices |S Business Revenues 14 Mortgage Market and Freddie Mac Delinquencies 16 Reserve for Loan Losses: 15~ Single-Family Creat Statistics 7 Quart
Slide 3: GAAP financial results
GAAP financial results Line 1: Increased net interest income primarily reflects lower funding costs in 3Q09. Line 3: Decreased net mark-to-market gains during 3Q09 were primarily attributable to the effects of lower long-term interest rates and spreads tightening on the values of the company's deriv
Slide 4: Total equity and Purchase Agreement with Treasury
Total equity and Purchase Agreement with Treasury 1 Reflects the adoption of new accounting guidance on January 1, 2009, which resulted in the classification of noncontrolling interests as part of total equity (deficit). 3Q 2008 data has been restated to conform to the current presentation. 2 As a r
Slide 5: Business revenues
Business revenues 1 Represents period-end unpaid principal balance (UPB). 2 Fully taxable-equivalent basis. 3 Net interest income for the third quarter excludes the cost of funds the company received from the Treasury under the Purchase Agreement which is reported as dividends paid on senior preferr
Slide 6: Reserve for loan losses
Reserve for loan losses $2,312 $2,822 $3,872 $5,813 $15,618 $320 $545 $942 $863 $1,014 $1,907 $2,252 $6,953 $8,791 $5,199 $25,197 $29,578 $22,678 $10,220 $75 $111 $5,702 $2,537 $1,240 $787 $1,372 $7,577 1.27% 1.48% 0.13% 0.16% 0.21% 0.53% 0.81% 1.16% 0.30% $0 $5,000 $10,000 $15,000 $20,000 $25,000 $
Slide 7: Quarterly mark-to-market items
Quarterly mark-to-market items Line 1: The company recorded derivatives losses primarily due to interest-rate related factors, as long-term swap rates decreased during the period, switching the net pay-fixed swaps portfolio to losses in 3Q09 from gains in 2Q09. Line 4: Decreased gains on the guarant
Slide 8: Freddie Mac supports the housing market
Freddie Mac supports the housing market 1 Estimate based on internal Freddie Mac single-family funding volumes for 2009 divided by the gross mortgage origination amount as reported by Inside Mortgage Finance. 2 Refinancing total and borrower savings amounts for the full-year 2009, as of September 30
Slide 9: Freddie Mac refinance activity
Year-to-date Freddie Mac has refinanced approximately 1.5 million borrowers Estimated total annual borrower savings of $3.81 billion Estimated annual savings of over $2,6001 per refinanced borrower Expanded the scope of the Relief Refinance Program Increased the maximum eligible LTV ratio to 125% on
Slide 10: Foreclosure prevention efforts
Foreclosure prevention efforts Completed modifications and Home Affordable Modification (HAMP) trial period loans Completed Modifications HAMP Trial Period Loans Year-to-date Freddie Mac has modified a total of 49,239 loans to at-risk borrowers Estimated annual savings of $3,6001 per borrower At Sep
Slide 11: Credit Supplement
Bins Dh “W444 Credit Supplement
Slide 12: National home prices have experienced a cumulative decline of 17% since June 2006
National home prices have experienced a cumulative decline of 17% since June 20061 1 National home prices use the internal Freddie Mac index, which is value-weighted based on Freddie Mac's single-family portfolio. The U.S. index is a monthly series; quarterly growth rates are calculated as a 3-month
Slide 13: States and Washington, DC had home price declines from September 2008 to September 2009
44 States and Washington, DC had home price declines from September 2008 to September 20091 1 National home prices use the internal Freddie Mac index, which is value-weighted based on Freddie Mac's single-family portfolio. The state index is a monthly series; annual growth rates are calculated as a
Slide 14: Total mortgage market, prime, and Freddie Mac delinquency rates
Total mortgage market, prime, and Freddie Mac delinquency rates Single-family delinquency rates as of June 30, 2009 1 Source: National Delinquency Survey from the Mortgage Bankers Association. Categories represent first lien single-family loans. Data is not yet available for the third quarter of 200
Slide 15: Single-family credit statistics
Single-family credit statistics1 1 Beginning in November 2008, Freddie Mac periodically suspended foreclosure transfers of occupied homes and evictions for those homes eligible for certain foreclosure alternative programs, including the MHA Program. These periodic suspensions create fluctuations in
Slide 16: Single-family credit losses by book year and state
Single-family credit losses by book year1 and state 1 Book year indicates year of loan origination. 2 Excludes Structured Securities backed by Ginnie Mae Certificates. 3 Credit losses consist of the aggregate amount of charge-offs, net of recoveries, and the amount of REO operations expense in each
Slide 17: Single-family 3Q 2009 credit losses & REO counts by region and state
1 Excludes Structured Securities backed by Ginnie Mae Certificates. 2 Based on the number of mortgages 90 days or more delinquent or in foreclosure. UPB amounts exclude certain Structured Transactions. 3 Based on the UPB of loans at the time of REO acquisition. 4 Credit losses consist of the aggrega
Slide 18: Single-family portfolio characteristics
Single-family portfolio characteristics 1 Based on the unpaid principal balance of mortgage loans in the single-family portfolio. Disclosures include all Structured Transactions where loan characteristics data exists. 2 Loans purchased through bulk transactions and identified as Alt-A by the seller
Slide 19: Single-family portfolio characteristics, continued
Single-family portfolio characteristics 1 Based on the unpaid principal balance of mortgage loans in the single-family portfolio. Disclosures include all Structured Transactions where loan characteristics data exists. 2 Loans purchased through bulk transactions and identified as Alt-A by the seller
Slide 20: Single-family credit profile by book year and product feature
Single-family credit profile by book year and product feature 1 Based on the unpaid principal balance of mortgage loans in the single-family portfolio. Disclosures include all Structured Transactions where loan characteristics data exists. 2 Indicates year of loan origination. 3 Includes Structured
Slide 21: Single-family portfolio composition by product
Single-family portfolio composition by product 1 Based on the number of mortgages 90 days or more delinquent or in foreclosure. Percentage based on loan counts. 2 Includes 40-year and 20-year fixed-rate mortgages. 3 Interest-only includes adjustable-rate and fixed-rate mortgages.
Slide 22: Total single-family portfolio cumulative default rates by book year
Total Single-family portfolio cumulative default rates1 by book year 1 Represents the cumulative transition rate of loans to a default event, and is calculated for each year of origination as the number of loans that have proceeded to foreclosure acquisition or other disposition events, excluding li
Slide 23: 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