Company: FMCCN
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0001026214-25-000040
Chunk: 47

Company: FEDERAL HOME LOAN MORTGAGE CORP
Filing Date: 2025-02-13
Form: 10-K
Item: Item 13
Chunk 47
---
 our credit loss estimation process.

n    2023 vs. 2022

l    Net income of $1.5 billion, up 5% year-over-year.

–Net revenues were $3.0 billion, up 18% year-over-year. 

◦Net interest income was $0.9 billion, down 6% year-over-year, primarily due to lower prepayment income driven by higher mortgage interest rates, partially offset by higher net interest income from mortgage loans.

◦Non-interest income was $2.1 billion, up 32% year-over-year, primarily driven by higher fair value losses on our guarantee assets in 2022, net of the related interest-rate risk management activities. During 2Q 2022, we updated our funds transfer pricing methodologies to allocate gains and losses on derivative instruments to Multifamily to offset interest rate-related changes in fair value on our guarantee assets.

–Provision for credit losses was $0.3 billion, driven by a credit reserve build due to increased uncertainty in forecasted economic and multifamily market conditions as well as deterioration in overall loan performance.

–Non-interest expense was $0.8 billion, up 17% year-over-year, primarily driven by an allocation of $63 million for the $313 million accrual for the adverse judgment at trial.

FREDDIE MAC  |  2024 Form 10-K46

Management's Discussion and AnalysisRisk Management

RISK MANAGEMENT

Overview 

To achieve our mission of providing liquidity, stability, and affordability to the U.S. housing market, we take risks as an integral part of our business activities. Risk is the possibility that events will occur that adversely impact our financial strength, safe and sound operations, and ability to achieve our mission, strategic, and business objectives. Risk can manifest itself in many ways and the responsibility for risk management resides at all levels of the company. We seek to take risks in a safe and sound, well-controlled manner to earn acceptable risk-adjusted returns on a corporate-wide, divisional, and, where applicable, transaction basis. Our goal is to maintain an effective risk culture where employees are risk aware, collaborative, transparent, and individually accountable for their decisions, and to conduct business in an effective, legal, and ethical manner.  

We utilize a risk taxonomy to define, classify, and report risks that we face in operating our business. These risks have the potential to adversely affect our current or projected financial and operational resilience