Company: FMCCN
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0001026214-25-000040
Chunk: 267

Company: FEDERAL HOME LOAN MORTGAGE CORP
Filing Date: 2025-02-13
Form: 10-K
Item: Item 15
Chunk 267
---
, we use a statistical regression analysis.At inception of the hedge relationship, we prepare formal contemporaneous documentation of our risk management objective and strategies for undertaking the hedge. If a hedge relationship qualifies for fair value hedge accounting, all changes in fair value of the derivative hedging instrument, including interest accruals, are recognized in the same consolidated statements of income line item used to present the earnings effect of the hedged item. Therefore, changes in the fair value of the hedged item, mortgage loans and debt, attributable to the risk being hedged are recognized in interest income and interest expense, respectively, along with the changes in the fair value of the respective derivative hedging instruments. Changes in the fair value of the hedged item attributable to the risk being hedged are recognized as a cumulative basis adjustment against the mortgage loans and debt. The cumulative basis adjustments are amortized to the same consolidated statements of income line item used to present the changes in fair value of the hedged item using the effective interest method considering the contractual terms of the hedged item, with amortization beginning no later than the period in which hedge accounting was discontinued.

FREDDIE MAC  |  2024 Form 10-K178

Financial Statements                              Notes to Consolidated Financial Statements | Note 9

The table below presents the effects of fair value hedge accounting by consolidated statements of income line item, including the gains and losses on derivatives and hedged items designated in qualifying hedge relationships and other components due to the application of hedge accounting. Table 9.4 - Gains and Losses on Fair Value HedgesYear Ended December 31,202420232022(In millions)Interest IncomeInterest ExpenseInterest IncomeInterest ExpenseInterest IncomeInterest ExpenseTotal amounts of income and expense line items presented in our consolidated statements of income in which the effects of fair value hedges are recorded:$117,877 ($98,140)$105,363 ($86,821)$83,458 ($65,453)Interest contracts on mortgage loans held-for-investment:Gain (loss) on fair value hedging relationships:Hedged items(1,857)— 671 — (5,817)— Derivatives designated as hedging instruments1,650 — (854)— 5,000 — Interest accruals on hedging instruments874 — 948 — (294)— Discontinued hedge related basis adjustments amortization202 — 198 — (79)— Interest contracts on debt