Freddie Mac Credit Protected $69B of Q3 Single-Family Mortgages

Freddie Mac announced that its Credit Risk Transfer (CRT) program transferred approximately $2.5 billion of credit risk on $69 billion of single-family mortgages from taxpayers to the private sector during the third quarter of this year.

 

Freddie Mac issued six STACR and ACIS transactions in the third quarter: three on-the-run deals (DNA and HQA) and three seasoned deals (ARMR and FTR). As a result of STACR and ACIS on the run transactions this quarter, Freddie Mac transferred between 80 percent (high LTV HQA series) and 90 percent (low LTV DNA series) of the credit risk on the underlying reference pools, helping to reduce capital required under the Conservatorship Capital Framework. This brings the year-to-date total of credit risk transferred to $7.3 billion on $196 billion of single-family mortgages.

 

“Freddie Mac is committed to the stability of the U.S. housing finance system, and CRT is a key component,” said Mike Reynolds, vice president, credit risk transfer. “We will continue to offer attractive opportunities for private capital to participate in our program as we expand CRT coverage across our book of business.”

 

Just last week, Freddie Mac reported a third quarter net income of $1.7 billion, up from $1.5 billion from Q2 of 2019.

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