2003 Annual Report

The complete report has been divided into four segments for easier online viewing and printing.

To our Shareholders:

I am pleased to write you my first annual letter as chairman and CEO of Freddie Mac. Even in the very challenging year that led up to my arrival, the company delivered good financial results—which I’ll discuss later in this message—while fulfilling our mission.

This past December, when the board of directors asked me to take on this job, I was deeply honored. That’s because Freddie Mac is much more than one of the largest financial services companies in America. As a government-sponsored enterprise, or GSE, we have the vital public mission of helping American families achieve their dreams through low-cost homeownership. We also have the responsibility to keep our company financially safe, sound and strong. And I feel a powerful personal obligation—as in my preceding private-sector jobs—to be a vigilant steward of shareholder capital. Read the full text of the letter from Richard Syron [PDF 230K].

Segment 1 of the Report [PDF 230K] contains the following information:

Board of Directors
Senior Management

Table of Contents

EXPLANATORY NOTE
BUSINESS
   Financial Information about Segments
   Business Review
   Market Overview
   Mortgage Purchase and Guarantee Activity
   The To Be Announced Market
   Resecuritization
   Portfolio Investment
   PC Market-Making and Support Activities
   Mortgage Security Performance and Other Market
     Support Activities
   Regulation and Governmental Relationships
PROPERTIES
LEGAL PROCEEDINGS
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
MARKET PRICE FOR THE COMPANY'S COMMON EQUITY AND
  RELATED STOCKHOLDER MATTERS
FORWARD-LOOKING STATEMENTS
SELECTED FINANCIAL DATA

2003 Annual Report
Complete 2003 Annual Report [PDF 830K] Interactive Annual Report Consolidated Financial Statements [XLS 186K] Segment 1 Segment 2 Segment 3 Segment 4

Related Links
Freddie Mac Issues Proxy Statement and 2003 Information Statement and Annual Report. Freddie Mac Sets Annual Stockholders' Meeting Date and Announces Deadlines for Submitting Stockholder Proposals and Director Nominations Freddie Mac Announces Timeframe and Process for Submitting Stockholder Proposals Corporate Governance

Segment 2 of the Report [PDF 234K] contains the following information:

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
  CONDITION AND RESULTS OF OPERATIONS
    EXECUTIVE SUMMARY
    CRITICAL ACCOUNTING POLICIES
    CONSOLIDATED RESULTS OF OPERATIONS
    CONSOLIDATED BALANCE SHEETS ANALYSIS
    AVERAGE CONSOLIDATED BALANCE SHEETS AND
      RATE/VOLUME ANALYSIS
    CONSOLIDATED FAIR VALUE BALANCE SHEETS
    VOLUME STATISTICS
    LIQUIDITY AND CAPITAL RESOURCES
    OFF-BALANCE SHEET ARRANGEMENTS

Segment 3 of the Report [PDF 200K] contains the following information:

    RISK MANAGEMENT
        Operational Risk
        Interest-Rate and Other Market Risks
        Credit Risks
    QUARTERLY SELECTED FINANCIAL DATA
    SUBSEQUENT ACCOUNTING REVISIONS
    VOLUNTARY COMMITMENTS

Segment 4 of the Report [PDF 318K] contains the following information:

CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY
  DATA
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
  ACCOUNTING AND FINANCIAL DISCLOSURE
DIRECTORS AND EXECUTIVE OFFICERS
EXECUTIVE COMPENSATION
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
  MANAGEMENT AND RELATED STOCKHOLDER MATTERS
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
INDEMNIFICATION AND OTHER REIMBURSEMENTS OF DIRECTORS,
  OFFICERS AND EMPLOYEES
PRINCIPAL ACCOUNTANT FEES AND SERVICES
CERTIFICATIONS
RATIO OF EARNINGS TO FIXED CHARGES AND EARNINGS TO
  COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS