Freddie Mac Again Upsizes STACR Offering and Related ACIS Policy

STACR REMIC 2020-HQA3 Catches Investor Attention

MCLEAN, Va., Aug. 04, 2020 (GLOBE NEWSWIRE) -- Freddie Mac (OTCQB: FMCC) announced today that it has closed its $835 million STACR REMIC 2020-HQA3 offering. For the second time since March, Freddie Mac addressed strong investor interest in the offering by upsizing the bonds. The company also upsized and closed the related ACIS 2020-HQA3 insurance policy. 

STACR (Structured Agency Credit Risk) and ACIS (Agency Credit Insurance Structure) make up Freddie Mac's flagship Credit Risk Transfer (CRT) program.

“The CRT market’s quick recovery demonstrates its resilience and appeal to investors,” said Freddie Mac’s Mike Reynolds, Vice President, Single-Family CRT. “Once again, strong interest in our offerings led us to upsize both the STACR notes and the ACIS policy.”

STACR REMIC 2020-HQA3
STACR REMIC 2020-HQA3 is Freddie Mac’s third securities transaction of the year covering single-family loans with high loan-to-value (LTV) ratios between 81% and 97%. The loans were securitized between October 1, 2019 and December 31, 2019 and originated on or after January 1, 2015.

Pricing for STACR REMIC 2020-HQA3:

• M-1 - One-Month LIBOR plus 1.55%
  
  
• M-2 - One-Month LIBOR plus 3.60%
  
  
• B-1 - One-Month LIBOR plus 5.75%
  
  
• B-2 - One-Month LIBOR plus 10%

Freddie Mac holds in its entirety the senior loss risk A-H reference tranche and the first loss B-3H reference tranche in the capital structure. Freddie Mac also retains a portion of the risk in the class M-1, M-2, B-1, and B-2 tranches. Citigroup Global Markets Inc. and BNP Paribas Securities Group are co-lead managers and joint bookrunners.

ACIS 2020-HQA3
The ACIS 2020-HQA3 insurance policy covers the same reference pool of single-family loans. The policy provides a maximum limit of up to approximately $246 million of losses on a $31.3 billion reference pool. Through ACIS 2020-HQA3, a substantial portion of the remaining credit risk on STACR 2020-HQA3 is being transferred.

Freddie Mac has led the market in introducing new credit risk sharing opportunities. Since 2013, the company has transferred a portion of credit risk on approximately $1.6 trillion in unpaid principal balance (UPB) on single-family mortgages. It has also grown its investor base to more than 250 unique participants, including investors, insurers and reinsurers.

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, 2019, filed with the Securities and Exchange Commission (SEC) on February 13, 2020; 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, 2019, 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.