Freddie Mac Prices First STACR Credit Risk Sharing Transaction of 2014

Freddie Mac Prices First STACR Credit Risk Sharing Transaction of 2014  MCLEAN, VA -- (Marketwired) -- 02/06/14 --   A $1 billion offering of the Freddie Mac (OTCQB: FMCC) Structured Agency Credit Risk (STACR(R)) debt notes priced today. This offering represents one of the largest subordinate mortgage credit securitizations ever brought to market and Freddie Mac's first STACR offering this year. With STACR debt notes, private sources, and not taxpayers, predominately take the credit risk. Freddie Mac introduced the product last year and led the market in successfully completing two of the largest credit security offerings in 2013.  "We are pleased with the investor interest and demand for this product as more investors are buying the bonds," said Donna Corley, senior vice president of single family pricing and costing for Freddie Mac. "We plan regular and consistent issuances this year so that the amount of risk transferred to private investors will increase over time."   Kevin Palmer, vice president of single-family strategic credit costing and structuring for Freddie Mac, added, "We've introduced three bonds for the STACR 2014 series, compared to the two we offered in 2013, which provides more credit protection to Freddie Mac and enhances the product mix for investors. We believe these enhancements attracted even more investors, as we saw over 20 new investors in the book. We anticipate that more investors will continue to be attracted to the risk sharing program."   Over 65 investors participated in the offering. Pricing for the STACR Debt Notes, Series 2014 DN1 M-1 class was one-month LIBOR plus a spread of 100 basis points. Pricing for the M-2 class was one month LIBOR plus a spread of 220 basis points. Pricing for the M-3 class was one month LIBOR plus a spread of 450 basis points. The offering was oversubscribed and is scheduled to settle on or around Feb. 12, 2014.  The STACR 2014 DN1, M-1 class received investment grade ratings of A1 from Moody's and A by Kroll, subject to ongoing monitoring. The M-2 class received investment grade ratings of Baa1 from Moody's and BBB by Kroll, subject to ongoing monitoring. The M-3 class was not rated. The three classes have an exchangeable feature giving investors the option to either combine pro-rata portions of the cash flows from the M-1, M-2 and M-3 classes or strip off a portion of the interest from any class to create bonds with different margins.   For STACR 2014 DN1, the amount of periodic principal and ultimate principal paid by Freddie Mac is determined by the performance of a very large and diversified reference pool of almost 140,000 residential loans, representing an unpaid principal balance of approximately $32.4 billion. This pool consists of a subset of 30-year fixed-rate single-family mortgages acquired by Freddie Mac in the second quarter of 2013. Freddie Mac holds the senior risk and the first loss risk in reference pool, and a portion of the risk in the M-1, M-2 and M-3 classes.  STACR Debt Notes, Series 2014-DN1, were offered to the market by Credit Suisse and Bank of America Merrill Lynch as co-lead managers and joint bookrunners. BNP Paribas, JP Morgan and Nomura served as co-managers, and Mischler Financial as a selling group member.   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, 2012, filed with the Securities and Exchange Commission ("SEC") on February 28, 2013; 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, 2012, 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, 2012, 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 homebuyers and is one of the largest sources of financing for multifamily housing. www.FreddieMac.com. Twitter: @FreddieMac  MEDIA CONTACT: Patti Boerger 703-903-2445 Patricia_Boerger@FreddieMac.com  INVESTOR CONTACT:  Kevin Palmer 571-382-4313