MCLEAN, VA--(Marketwired - Jun 2, 2015) - Freddie Mac (OTCQB: FMCC) today priced a $425.6 million Structured Agency Credit Risk (STACR®) debt notes offering, its fourth one this year. Through STACR, Freddie Mac transfers a portion of its credit risk on certain groups of loans to private investors.
Pricing for STACR Series 2015-HQ2:
- M-1 class was one-month LIBOR plus a spread of 110 basis points.
- M-2 class was one month LIBOR plus a spread of 195 basis points.
- M-3 class was one month LIBOR plus a spread of 325 basis points.
- B class was one month LIBOR plus a spread of 795 basis points.
"This transaction went smoothly and investor demand was strong. The B class spreads were the tightest to date for STACR, which is a positive sign as we continue to grow this new asset class," said Mike Reynolds, Freddie Mac vice president of Credit Risk Transfer.
With STACR Series 2015-HQ2, Freddie Mac is issuing 100 basis points of first loss and rating the M-3 bond. Freddie Mac holds the senior loss risk in the capital structure and a portion of the risk in the Class M-1, M-2 and M-3, and the first loss Class B tranche. STACR HQ2 is fixed severity, not actual loss.
Barclays and Nomura are co-lead managers and joint bookrunners. BNP Paribas and Morgan Stanley are co-managers, and Multi-Bank Securities Inc. is a selling group member.
STACR Series 2015-HQ2 has a reference pool of Single-Family mortgages with an unpaid principal balance of more than $30.3 billion. The reference pool consists of a subset of 30-year fixed-rate single-family mortgages acquired by Freddie Mac in the first through third quarters of 2013 with LTVs from 80 to 95 percent.
A STACR investor presentation pdf and additional information about the company's Credit Risk Offerings is available at FreddieMac.com.
This announcement is not an offer to sell any Freddie Mac securities. Offers for any given security are made only through applicable offering circulars and related supplements, which incorporate Freddie Mac's Annual Report on Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission (SEC) on February 19, 2015; all other reports Freddie Mac filed with the SEC pursuant to Section 13(a) of the Securities Exchange Act of 1934 (Exchange Act) since December 31, 2014, excluding any information "furnished" to the SEC on Form 8-K; and all documents that Freddie Mac files with the SEC pursuant to Sections 13(a), 13(c) or 14 of the Exchange Act, excluding any information furnished to the SEC on Form 8-K.
Freddie Mac's press releases sometimes contain forward-looking statements. A description of factors that could cause actual results to differ materially from the expectations expressed in these and other forward-looking statements can be found in the company's Annual Report on Form 10-K for the year ended December 31, 2014, and its reports on Form 10-Q and Form 8-K, filed with the SEC and available on the Investor Relations page of the company's Web site at www.FreddieMac.com/investors and the SEC's Web site at www.sec.gov.
Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Today Freddie Mac is making home possible for one in four home borrowers and is one of the largest sources of financing for multifamily housing. Additional information is available at FreddieMac.com, Twitter @FreddieMac and Freddie Mac's blog FreddieMac.com/blog.
The financial and other information contained in the documents that may be accessed on this page speaks only as of the date of those documents. The information could be out of date and no longer accurate. Freddie Mac does not undertake an obligation, and disclaims any duty, to update any of the information in those documents. Freddie Mac's future performance, including financial performance, is subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect the company's future results are discussed more fully in our reports filed with the SEC.