Freddie Mac Settles Guaranteed Structured Pass-Through K Certificates
June 18,
2009
Contact:
corprel@freddiemac.com
or (703) 903-3933
Successful Offering Brings Needed Liquidity to Multifamily Investment Market
McLean, VA – Freddie Mac (NYSE: FRE) today announced that it has settled the offering of its Series K-003 Structured Pass-Through Certificates ("K Certificates"), multifamily mortgage-backed securities intended to provide liquidity, stability and affordability to the nation's multifamily housing market. The securities priced on June 5, 2009.
The issue was priced as follows:
|
Class
|
Coupon
|
Dollar Price
|
Subscription
Levels |
| Class A-1 |
2.225%
|
$100
|
6.1x
|
|
Class A-2
|
3.607%
|
$101
|
4.5x
|
|
Class A-3
|
4.324%
|
$101
|
2.1x
|
|
Class A-4
|
5.053%
|
$101
|
1.1x
|
| Class A-AB |
4.768%
|
$101
|
1.9x
|
| Class A-5 |
5.085%
|
$101
|
2.1x
|
| Class A-6 |
5.105%
|
$101
|
N/A
|
Classes A-X1 and A-X3 pay interest based on variable rates. The initial coupon for Class A-X1 was 0.583% and the initial coupon for Class A-X3 was 4.382%.
"The successful completion of this transaction demonstrates Freddie Mac's unwavering commitment to find new and innovative ways to provide critically-needed liquidity and stability to the country's multifamily housing finance market," said Mike May, senior vice president of Multifamily. "We're pleased with the positive response from investors and customers to our multifamily securitization efforts. Investor response to the offering was strong and all classes of K Certificates were oversubscribed."
May added, "This transaction offered the global capital markets structured securities backed by Freddie Mac multifamily mortgages, and enabled us to reduce our dependence on our balance sheet, redeploy our capital and prudently manage our risk."
David Brickman, vice president of Multifamily and CMBS Capital Markets for Freddie Mac, explained that the K Certificates are backed by multifamily mortgages originated through the Freddie Mac Capital Markets ExecutionSM (CME). "CME offers our customers a more standardized multifamily mortgage product with better pricing," Brickman said. "We expect to expand our securities activities and see a growing volume of multifamily loans coming through our CME pipeline."
The K Certificates were offered to the market by a network of dealers led by Deutsche Bank Securities Inc. Investors were large money managers, life insurance companies and pension funds. The Series K-003 SPC offering circular supplements can be found at http://www.freddiemac.com/mbs/data/k003oc.pdf and http://www.freddiemac.com/mbs/data/k003sup1.pdf
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, 2008, filed with the Securities and Exchange Commission ("SEC") on March 11, 2009, and all documents that Freddie Mac files with the SEC pursuant to Section 13(a), 13(c) or 14 of the Securities Exchange Act of 1934, 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, 2008 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. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.
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