SOURCE: Freddie Mac

Freddie Mac

November 16, 2017 10:10 ET

Freddie Mac Prices $1 Billion Multifamily K-Deal Backed by Seasoned Loans

MCLEAN, VA--(Marketwired - Nov 16, 2017) - Freddie Mac (OTCQB: FMCC) recently priced a K-P Series offering of Structured Pass-Through Certificates (K Certificates), which are multifamily mortgage-backed securities. The company expects to issue approximately $1 billion in K Certificates (K-P04 Certificates), which are expected to settle on or about November 28, 2017.

The K-P04 Certificates are guaranteed by Freddie Mac and are backed by 21 seasoned multifamily mortgages from the company's retained portfolio. In the K-P Series, Freddie Mac purchases and guarantees all of the securities issued by the related underlying trusts. 

K-P04 Pricing

                     
Class   Principal / Notional Amount (mm)   Weighted Average Life (Years)   Discount Margin   Coupon   Dollar Price
A-G1   $500.000   2.66   22   1 mo LIBOR + 22   $100.0000
A-G2   $500.000   1.91   20   1 mo LIBOR + 20   $100.0000
X-G1   $500.000   2.66   Not Offered
X-G2   $500.000   1.91   Not Offered
             

Details

  • Sole Lead Manager and Bookrunner: Morgan Stanley & Co. LLC
  • Co-Managers: Citigroup Global Markets Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Multi-Bank Securities, Inc. and PNC Capital Markets LLC
  • The K-P04 Certificates are backed by corresponding classes issued by the FREMF 2017-KP04 Mortgage Trust (K-P04 Trust) and are guaranteed by Freddie Mac

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Freddie Mac Multifamily is a leading issuer of agency-guaranteed structured multifamily securities. K-Deals are part of the company's business strategy to transfer a portion of the risk of losses away from taxpayers and to private investors who purchase the unguaranteed subordinate bonds. K Certificates typically feature a wide range of investor options with stable cash flows and structured credit enhancement.

This announcement is not an offer to sell any securities of Freddie Mac or any other issuer. 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, 2016, filed with the Securities and Exchange Commission (SEC) on February 16, 2017; 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, 2016, 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, 2016, 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 makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we've made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac's blog FreddieMac.com/blog.

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