UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended June 30, 2023

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from                                to

Commission File Number: 001-34139

Federal Home Loan Mortgage Corporation 

(Exact name of registrant as specified in its charter)

Federally chartered 52-0904874 8200 Jones Branch Drive 22102-3110 (703) 903-2000 corporation McLean, Virginia

(State or other jurisdiction of 

incorporation or organization)

(I.R.S. Employer

Identification No.) (Address of principal executive offices) (Zip Code) (Registrant's telephone number,including area code)

Securities registered pursuant to Section 12(b) of the Act: 

Title of each class Trading Symbol(s) Name of each exchange on which registered

None N/A N/A

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the 

Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was 

required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be 

submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such 

shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 

smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated 

filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☒

Non-accelerated filer ☐ Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition 

period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the 

Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange 

Act).    Yes ☐  No ☒		 			

As of July 11, 2023, there were 650,059,553 shares of the registrant's common stock outstanding.
Table of Contents

Page

MANAGEMENT'S DISCUSSION AND ANALYSIS OF 

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

1

n Introduction 1

n Housing and Mortgage Market Conditions 4

n Consolidated Results of Operations 6

n Consolidated Balance Sheets Analysis 10

n Our Portfolios 11

n Our Business Segments 13

n Risk Management 23

l	Credit Risk 23

l	Market Risk 31

n Liquidity and Capital Resources 34

n Critical Accounting Estimates 42

n Regulation and Supervision 43

n Forward-Looking Statements 44

FINANCIAL STATEMENTS 46

OTHER INFORMATION 97

CONTROLS AND PROCEDURES 99

EXHIBIT INDEX 100

SIGNATURES 101

FORM 10-Q INDEX 102

Table of Contents

Freddie Mac 2Q 2023 Form 10-Q i
MD&A TABLE INDEX

1 Summary of Consolidated Statements of Income and Comprehensive Income 6

2 Components of Net Interest Income 6

3 Analysis of Net Interest Yield 7

4 Components of Non-Interest Income 8

5 (Provision) Benefit for Credit Losses 8

6 Components of Non-Interest Expense 9

7 Summarized Condensed Consolidated Balance Sheets 10

8 Mortgage Portfolio 11

9 Mortgage-Related Investments Portfolio 12

10 Other Investments Portfolio 12

11 Single-Family Segment Financial Results 18

12 Multifamily Segment Financial Results 22

13 Allowance for Credit Losses Activity 23

14 Allowance for Credit Losses Ratios 24

15 Single-Family New Business Activity 25

16 Single-Family Mortgage Portfolio CRT Issuance 25

17 Single-Family Mortgage Portfolio Credit Enhancement Coverage Outstanding 26

18 Serious Delinquency Rates for Credit-Enhanced and Non-Credit-Enhanced Loans in Our Single-Family Mortgage Portfolio 26

19 Credit Quality Characteristics of Our Single-Family Mortgage Portfolio 27

20 Single-Family Mortgage Portfolio Attribute Combinations 28

21 Multifamily Mortgage Portfolio CRT Issuance 30

22 Credit-Enhanced and Non-Credit-Enhanced Loans Underlying Our Multifamily Mortgage Portfolio 31

23 Credit Quality of Our Multifamily Mortgage Portfolio Without Credit Enhancement 31

24 PVS-YC and PVS-L Results Assuming Shifts of the Yield Curve 32

25 Duration Gap and PVS Results 32

26 PVS-L Results Before Derivatives and After Derivatives 32

27 Earnings Sensitivity to Changes in Interest Rates 33

28 Liquidity Sources 34

29 Funding Sources 35

30 Debt of Freddie Mac Activity 35

31 Maturity and Redemption Dates 36

32 Debt of Consolidated Trusts Activity 37

33 Net Worth Activity 38

34 Regulatory Capital Components 39

35 Statutory Capital Components 39

36 Capital Metrics Under ERCF 40

37 Forecasted House Price Growth Rates 42

Table Description Page

 

Table of Contents

Freddie Mac 2Q 2023 Form 10-Q ii
Management's Discussion and Analysis of 

Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q includes forward-looking statements that are based on current expectations and that are 

subject to significant risks and uncertainties. These forward-looking statements are made as of the date of this Form 10-Q. We 

undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date of this Form 

10-Q. Actual results might differ significantly from those described in or implied by such statements due to various factors and 

uncertainties, including those described in the MD&A - Forward-Looking Statements section of this Form 10-Q and the 

Introduction and Risk Factors sections of our Annual Report on Form 10-K for the year ended December 31, 2022, or 2022 

Annual Report.

Throughout this Form 10-Q, we use certain acronyms and terms that are defined in the Glossary of our 2022 Annual Report. 

You should read the following MD&A in conjunction with our 2022 Annual Report and our condensed consolidated financial 

statements and accompanying notes for the three and six months ended June 30, 2023 included in Financial Statements.

INTRODUCTION

Freddie Mac is a GSE chartered by Congress in 1970, with a mission to provide liquidity, stability, and affordability to the U.S. 

housing market. We do this primarily by purchasing single-family and multifamily residential mortgage loans originated by 

lenders. In most instances, we package these loans into guaranteed mortgage-related securities, which are sold in the global 

capital markets, and transfer interest-rate and liquidity risks to third-party investors. In addition, we transfer mortgage credit risk 

exposure to third-party investors through our credit risk transfer programs, which include securities- and insurance-based 

offerings. We also invest in mortgage loans and mortgage-related securities. We do not originate mortgage loans or lend money 

directly to mortgage borrowers.

We support the U.S. housing market and the overall economy by enabling America's families to access mortgage loan funding 

with better terms and by providing consistent liquidity to the single-family and multifamily mortgage markets. We have helped 

many distressed borrowers keep their homes or avoid foreclosure and have helped many distressed renters avoid eviction.

Since September 2008, we have been operating in conservatorship, with FHFA as our Conservator. The conservatorship and 

related matters significantly affect our management, business activities, financial condition, and results of operations. Our future 

is uncertain, and the conservatorship has no specified termination date. We do not know what changes may occur to our 

business model during or following conservatorship, including whether we will continue to exist. In connection with our entry 

into conservatorship, we entered into the Purchase Agreement with Treasury, under which we issued Treasury both senior 

preferred stock and a warrant to purchase common stock. Our Purchase Agreement with Treasury is critical to keeping us 

solvent and avoiding the appointment of a receiver by FHFA under statutory mandatory receivership provisions. We believe the 

support provided by Treasury pursuant to the Purchase Agreement currently enables us to have adequate liquidity to conduct 

normal business activities. For additional information on the conservatorship and related matters and the Purchase Agreement, 

see our 2022 Annual Report.

Management's Discussion and Analysis Introduction 

Freddie Mac 2Q 2023 Form 10-Q 1
Business Results

Consolidated Financial Results

Net Revenues and Net Income

(In billions)

$5.4

$5.2

$4.8 $4.8

$5.3

$2.5

$1.3

$1.8

$2.0

$2.9

Net Revenues Net Income

2Q22 3Q22 4Q22 1Q23 2Q23

Net Worth

(In billions)

$34.1

$35.2

$37.0

$39.1

$42.0

06/30/22 09/30/22 12/31/22 03/31/23 06/30/23

Key Drivers:

n	 Net income was $2.9 billion, an increase of 20% year-over-year, with the increase primarily driven by a credit reserve 

release in Single-Family.

n Net revenues were $5.3 billion, a decrease of 1% year-over-year, as lower net interest income was partially offset by an 

increase in non-interest income.

n	 Net worth was $42.0 billion as of June 30, 2023, up from $39.1 billion as of March 31, 2023 and $34.1 billion as of June 30, 

2022. The quarterly increases in net worth have been, or will be, added to the aggregate liquidation preference of the 

senior preferred stock. The liquidation preference of the senior preferred stock was $111.7 billion on June 30, 2023, and 

will increase to $114.6 billion on September 30, 2023 based on the increase in net worth in 2Q 2023. 

Market Liquidity

 Market Liquidity

(In thousands)

616

542

504

250

372

263

297

200

157

217

205

95

52

33

41

148

150

252

60

114

Single-Family home purchase borrowers Single-Family refinance borrowers Multifamily rental units

2Q22 3Q22 4Q22 1Q23 2Q23

We support the U.S. housing market by executing our mission to provide liquidity and help maintain credit availability for new 

and refinanced single-family mortgages as well as for rental housing. We provided $96 billion in liquidity to the mortgage market 

in 2Q 2023, which enabled the financing of 372,000 home purchases, refinancings, and rental units.

Management's Discussion and Analysis Introduction 

Freddie Mac 2Q 2023 Form 10-Q 2
Mortgage Portfolio Balances

Mortgage Portfolio

(UPB in billions)

$3,343 $3,387 $3,415 $3,415 $3,431

$2,928 $2,971 $2,986 $2,989 $3,004

$415 $416 $429 $426 $427

Single-Family mortgage portfolio Multifamily mortgage portfolio

06/30/22 09/30/22 12/31/22 03/31/23 06/30/23

Key Drivers:

n	 Our mortgage portfolio increased 3% year-over-year to $3.4 trillion at June 30, 2023.

l Our Single-Family mortgage portfolio was $3.0 trillion at June 30, 2023, up 3% year-over-year, as portfolio growth has 

moderated in recent periods due to the slowdown in new business activity as both home purchase activity and 

refinance activity slowed due to higher mortgage interest rates.

l Our Multifamily mortgage portfolio was $427 billion at June 30, 2023, up 3% year-over-year, as portfolio growth has 

moderated in recent periods due to a slowdown in new business activity due to higher mortgage interest rates.

Credit Risk Transfer

Single-Family Mortgage Portfolio with Credit Enhancement 

(UPB in billions)

$1,726

$1,803 $1,832 $1,840 $1,864

59%

61% 61% 62% 62%

UPB Percentage

06/30/22 09/30/22 12/31/22 03/31/23 06/30/23

Multifamily Mortgage Portfolio with Credit Enhancement 

(UPB in billions)

$397 $394 $398 $396 $402

96% 95% 93% 93% 94%

UPB Percentage

06/30/22 09/30/22 12/31/22 03/31/23 06/30/23

In addition to transferring interest-rate and liquidity risk to third-party investors through our securitization activities, we engage 

in various credit enhancement arrangements to reduce our credit risk exposure. We transfer a portion of the credit risk, 

primarily on recently acquired loans, through our CRT programs. We also reduce our credit risk exposure through other credit 

enhancement arrangements, mainly primary mortgage insurance. See MD&A - Risk Management – Credit Risk for 

additional information on our credit enhancements and CRT programs.

Management's Discussion and Analysis Introduction 

Freddie Mac 2Q 2023 Form 10-Q 3
HOUSING AND MORTGAGE MARKET CONDITIONS

The following charts present certain housing and mortgage market indicators that can significantly affect our business and 

financial results. Certain market and macroeconomic prior period data have been updated to reflect revised historical data. For 

additional information on the effect of these indicators on our business and financial results, see MD&A – Consolidated 

Results of Operations and MD&A – Our Business Segments.

Single-Family

 U.S. Single-Family Home Sales and House Prices 

5,970

5,360

4,795 4,965 4,944

5,367 4,777 4,197 4,327 4,250

603

583

598 638 694

1.9% (0.9)% (0.7)% 1.1% 2.1%

Sales of existing homes (units in thousands)

Sales of new homes (units in thousands)

Single-family house price growth rate

2Q22 3Q22 4Q22 1Q23 2Q23

Sources: National Association of Realtors, U.S. Census Bureau, and Freddie Mac 

House Price Index.

 U.S. Single-Family Mortgage Originations 

_

(UPB in billions)

$760

$685

$530

$350

$290

4.67%

5.70%

6.70% 6.42% 6.32%

U.S. single-family originations

30-year PMMS

1Q22 2Q22 3Q22 4Q22 1Q23

Source: Freddie Mac and Inside Mortgage Finance. 2Q 2023 U.S. single-family 

mortgage originations data is not yet available.

Single-Family Serious Delinquency Rates

2.12%

1.90% 1.89% 1.73%

0.76% 0.67% 0.66% 0.62% 0.56%

Total mortgage market

Freddie Mac

2Q22 3Q22 4Q22 1Q23 2Q23

Source: Freddie Mac and National Delinquency Survey from the Mortgage 

Bankers Association. 2Q 2023 total mortgage market rate is not yet available.

Single-Family Mortgage Debt Outstanding

(UPB in billions)

$2,884 $2,928 $2,971 $2,986 $2,989

$12,708 $12,989 $13,217 $13,381 $13,430

Freddie Mac Single-Family mortgage portfolio

U.S. single-family mortgage debt outstanding

1Q22 2Q22 3Q22 4Q22 1Q23

Source: Freddie Mac and Federal Reserve Financial Accounts of the United 

States of America. 2Q 2023 U.S. single-family mortgage debt outstanding data 

is not yet available.

Management's Discussion and Analysis Housing and Mortgage Market Conditions

Freddie Mac 2Q 2023 Form 10-Q 4
Multifamily

Apartment Vacancy Rates and Change in Effective Rents

4.7% 4.7% 4.8% 5.0% 5.0%

3.0% 1.9% 2.0%

(0.9)%

0.8%

0.8%

Apartment vacancy rates

Quarterly change in effective rents

Long-term quarterly effective rent growth rate

(2000 - 2Q23)

2Q22 3Q22 4Q22 1Q23 2Q23

Source: Reis.

Multifamily Property Price Growth Rate

3.2%

(0.8)%

(6.1)%

(4.4)%

(0.8)%

2Q22 3Q22 4Q22 1Q23 2Q23

Source: Real Capital Analytics Commercial Property Price Index (RCA CPPI).

Multifamily Delinquency Rates

0.07%

0.13% 0.12% 0.13%

0.21%

1.12%

0.99%

0.92%

0.69% 0.68%

0.18%

0.15%

0.17%

0.20%

Freddie Mac (60+ day)

Multifamily CMBS market (60+ day)

FDIC insured institutions (90+ day)

2Q22 3Q22 4Q22 1Q23 2Q23

Source: Freddie Mac, FDIC Quarterly Banking Profile, Intex Solutions, Inc., and 

Wells Fargo Securities (Multifamily CMBS market, excluding REOs). The 2Q 2023 

delinquency rate for FDIC insured institutions is not yet available.

Multifamily Mortgage Debt Outstanding

(UPB in billions)

$415 $415 $416 $429 $426

$1,943 $1,986

$2,026 $2,067 $2,078

Freddie Mac Multifamily mortgage portfolio

U.S. multifamily mortgage debt outstanding

1Q22 2Q22 3Q22 4Q22 1Q23

Source: Freddie Mac and Federal Reserve Financial Accounts of the United 

States of America. 2Q 2023 U.S. multifamily mortgage debt outstanding data is 

not yet available.

Management's Discussion and Analysis Housing and Mortgage Market Conditions

Freddie Mac 2Q 2023 Form 10-Q 5
CONSOLIDATED RESULTS OF OPERATIONS

The discussion of our consolidated results of operations should be read in conjunction with our condensed consolidated 

financial statements and accompanying notes. Our financial results and business volumes could be negatively affected by 

adverse changes in the housing market or economic conditions, including volatility and stress within the banking sector and the 

measures governments and financial services companies take in response. Stress in U.S. regional banks could drive elevated 

counterparty credit risk and indirect risk due to financing or banking relationships that our counterparties have with the affected 

banking organizations. We could also experience declines in the liquidity in the markets for our securities as a result of any such 

adverse changes or regulatory responses to adverse changes. See Risk Factors in our 2022 Annual Report for additional 

information.

The table below compares our summarized consolidated results of operations. 

Table 1 - Summary of Consolidated Statements of Income and Comprehensive Income

Change Change

(Dollars in millions) 2Q 2023 2Q 2022 $ % YTD 2023 YTD 2022 $ %

Net interest income $4,523 $4,759 ($236) (5) % $9,024 $8,863 $161 2 %

Non-interest income 816 645 171 27 1,142 2,387 (1,245) (52) 

Net revenues 5,339 5,404 (65) (1) 10,166 11,250 (1,084) (10) 

(Provision) benefit for credit losses 537 (307) 844 275 142 530 (388) (73) 

Non-interest expense (2,204) (2,020) (184) (9) (4,136) (3,952) (184) (5) 

Income before income tax expense 3,672 3,077 595 19 6,172 7,828 (1,656) (21) 

Income tax expense (728) (624) (104) (17) (1,233) (1,577) 344 22 

Net income 2,944 2,453 491 20 4,939 6,251 (1,312) (21) 

Other comprehensive income (loss), 

net of taxes and reclassification 

adjustments

 (54) (66) 12 18 — (186) 186 100 

Comprehensive income $2,890 $2,387 $503 21 % $4,939 $6,065 ($1,126) (19) %

Net Revenues

Net Interest Income

The table below presents the components of net interest income.

Table 2 - Components of Net Interest Income 

Change Change

(Dollars in millions) 2Q 2023 2Q 2022 $ % YTD 2023 YTD 2022 $ %

Guarantee net interest income:

Contractual net interest income $3,658 $3,468 $190 5 % $7,324 $6,802 $522 8 %

Deferred fee income 232 944 (712) (75) 439 1,986 (1,547) (78) 

Total guarantee net interest income 3,890 4,412 (522) (12) 7,763 8,788 (1,025) (12) 

Investments net interest income 1,611 693 918 132 3,043 1,272 1,771 139 

Impact on net interest income from 

hedge accounting (978) (346) (632) (183) (1,782) (1,197) (585) (49) 

Net interest income $4,523 $4,759 ($236) (5) % $9,024 $8,863 $161 2 %

Key Drivers:

n Guarantee net interest income

l	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022 - Decreased primarily due to a decline in deferred fee income due 

to slower prepayments driven by higher mortgage interest rates, partially offset by continued mortgage portfolio 

growth and higher average portfolio guarantee fee rates.

n Investments net interest income

l	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022 - Increased primarily due to higher returns on securities purchased 

under agreements to resell as a result of higher short-term interest rates.

Management's Discussion and Analysis Consolidated Results of Operations

Freddie Mac 2Q 2023 Form 10-Q 6
n Impact on net interest income from hedge accounting

l	 2Q 2023 vs. 2Q 2022 - Expense increased primarily due to higher interest expense on derivatives in hedge 

relationships as a result of higher interest rates.

l	 YTD 2023 vs. YTD 2022 - Expense increased primarily due to higher interest expense on derivatives in hedge 

relationships as a result of higher interest rates, partially offset by a favorable change in the earnings mismatch on 

qualifying fair value hedge relationships in 1Q 2023.

Net Interest Yield Analysis

The table below presents a yield analysis of interest-earning assets and interest-bearing liabilities. 

Table 3 - Analysis of Net Interest Yield

2Q 2023 2Q 2022

(Dollars in millions)

Average

Balance

Interest

Income

(Expense)

Average

Rate

Average

Balance

Interest

Income

(Expense)

Average

Rate

Interest-earning assets:

Cash and cash equivalents $13,572 $135 3.93 % $14,628 $16 0.42 %

Securities purchased under agreements to resell 127,016 1,622 5.11 97,150 186 0.77 

Investment securities 39,617 363 3.67 50,655 464 3.66 

Mortgage loans(1) 3,047,556 23,598 3.10 2,953,930 19,324 2.62 

Other assets 2,749 37 5.40 4,250 18 1.71 

Total interest-earning assets 3,230,510 25,755 3.19 3,120,613 20,008 2.56 

Interest-bearing liabilities:

Debt of consolidated trusts 2,984,057 (18,608) (2.49) 2,903,912 (14,595) (2.01) 

Debt of Freddie Mac 201,432 (2,624) (5.21) 174,018 (654) (1.50) 

Total interest-bearing liabilities 3,185,489 (21,232) (2.67) 3,077,930 (15,249) (1.98) 

Impact of net non-interest-bearing funding 45,021 — 0.04 42,683 — 0.03 

Total funding of interest-earning assets 3,230,510 (21,232) (2.63) 3,120,613 (15,249) (1.95) 

Net interest income/yield $4,523 0.56 % $4,759 0.61 %

(1) Loan fees included in net interest income were $0.3 billion and $0.4 billion during 2Q 2023 and 2Q 2022, respectively.

YTD 2023 YTD 2022

(Dollars in millions)

Average

Balance

Interest

Income

(Expense)

Average

Rate

Average

Balance

Interest

Income

(Expense)

Average

Rate

Interest-earning assets:

Cash and cash equivalents $13,665 $256 3.72 % $15,230 $19 0.24 %

Securities purchased under agreements to resell 117,266 2,842 4.85 92,913 209 0.45 

Investment securities 38,871 679 3.49 50,514 848 3.36 

Mortgage loans(1) 3,044,843 46,902 3.08 2,927,495 36,634 2.50 

Other assets 2,339 63 5.36 4,892 38 1.53 

Total interest-earning assets 3,216,984 50,742 3.15 3,091,044 37,748 2.44 

Interest-bearing liabilities:

Debt of consolidated trusts 2,979,737 (36,869) (2.47) 2,870,198 (27,844) (1.94) 

Debt of Freddie Mac 194,516 (4,849) (4.98) 178,299 (1,041) (1.17) 

Total interest-bearing liabilities 3,174,253 (41,718) (2.63) 3,048,497 (28,885) (1.89) 

Impact of net non-interest-bearing funding 42,731 — 0.03 42,547 — 0.03 

Total funding of interest-earning assets 3,216,984 (41,718) (2.60) 3,091,044 (28,885) (1.86) 

Net interest income/yield $9,024 0.55 % $8,863 0.58 %

(1) Loan fees included in net interest income were $0.6 billion and $0.9 billion during YTD 2023 and YTD 2022, respectively.

Management's Discussion and Analysis Consolidated Results of Operations

Freddie Mac 2Q 2023 Form 10-Q 7
Non-Interest Income

The table below presents the components of non-interest income.

Table 4 - Components of Non-Interest Income 

Change Change

(Dollars in millions) 2Q 2023 2Q 2022 $ % YTD 2023 YTD 2022 $ %

Guarantee income:

Contractual guarantee fees 323 $322 $1 — % $647 $640 $7 1 %

Guarantee obligation amortization 286 306 (20) (7) 565 605 (40) (7) 

Guarantee asset fair value changes (300) (423) 123 29 (437) (970) 533 55 

Total guarantee income 309 205 104 51 775 275 500 182 

Investment gains, net:

Single-Family (4) 232 (236) (102) (183) 1,484 (1,667) (112) 

Multifamily 415 89 326 366 369 350 19 5 

Total investment gains, net 411 321 90 28 186 1,834 (1,648) (90) 

Other income 96 119 (23) (19) 181 278 (97) (35) 

Non-interest income $816 $645 $171 27 % $1,142 $2,387 ($1,245) (52) %

Key Drivers:

n Guarantee income

l	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022 - Increased primarily due to lower fair value losses on guarantee 

assets as a result of smaller interest rate increases.

n	 Investment gains, net

l	 2Q 2023 vs. 2Q 2022 - Net investment gains increased primarily due to fair value gains from interest-rate risk 

management activities in Multifamily.

l	 YTD 2023 vs. YTD 2022 - Net investment gains declined from elevated levels in YTD 2022, which were driven by 

spread-related gains on commitments to hedge the Single-Family securitization pipeline during that period.

(Provision) Benefit for Credit Losses

The table below presents the components of provision for credit losses.

Table 5 - (Provision) Benefit for Credit Losses 

Change Change

(Dollars in millions) 2Q 2023 2Q 2022 $ % YTD 2023 YTD 2022 $ %

Single-Family $638 ($298) $936 314 % $320 $533 ($213) (40) %

Multifamily (101) (9) (92) (1,022) (178) (3) (175) (5,833) 

 (Provision) benefit for credit losses $537 ($307) $844 275 % $142 $530 ($388) (73) %

Key Drivers:

n 2Q 2023 vs. 2Q 2022 - The benefit for credit losses for 2Q 2023 was primarily driven by a credit reserve release in SingleFamily due to improvements in observed and forecasted house price appreciation, partially offset by a credit reserve build 

in Multifamily due to deterioration in forecasted multifamily market conditions and current loan performance. The provision 

for credit losses for 2Q 2022 was primarily driven by a credit reserve build in Single-Family due to portfolio growth and 

deterioration in forecasted economic conditions.

n	 YTD 2023 vs. YTD 2022 - The benefit for credit losses for YTD 2023 was primarily driven by a credit reserve release in 

Single-Family due to improvements in forecasted house price appreciation, partially offset by a credit reserve build in 

Multifamily due to increased uncertainty in forecasted economic conditions and multifamily market conditions as well as 

deterioration in loan performance. The benefit for credit losses for YTD 2022 was primarily driven by a credit reserve 

release in Single-Family due to improvements in observed house price appreciation.

Management's Discussion and Analysis Consolidated Results of Operations

Freddie Mac 2Q 2023 Form 10-Q 8
Non-Interest Expense 

The table below presents the components of non-interest expense.

Table 6 - Components of Non-Interest Expense

Change Change

(Dollars in millions) 2Q 2023 2Q 2022 $ % YTD 2023 YTD 2022 $ %

Salaries and employee benefits ($405) ($376) ($29) (8) % ($779) ($732) ($47) (6) %

Credit enhancement expense (590) (558) (32) (6) (1,120) (1,017) (103) (10) 

Benefit for (decrease in) credit 

enhancement recoveries (108) (1) (107) (10,700) (59) (18) (41) (228) 

Legislative assessments expense:

Legislated guarantee fees expense (710) (684) (26) (4) (1,418) (1,350) (68) (5) 

Affordable housing funds allocation (41) (64) 23 36 (68) (157) 89 57 

Total legislative assessments 

expense (751) (748) (3) — (1,486) (1,507) 21 1 

Other expense (350) (337) (13) (4) (692) (678) (14) (2) 

Non-interest expense ($2,204) ($2,020) ($184) (9) % ($4,136) ($3,952) ($184) (5) %

Key Drivers:

n	 Credit enhancement expense 

l	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022 - Increased primarily due to a higher volume of outstanding 

cumulative CRT transactions.

n	 Benefit for (decrease in) credit enhancement recoveries

l	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022 - Decreased primarily due to a decrease in expected credit losses 

on covered loans.

n	 Legislative assessments expense

l	 2Q 2023 vs. 2Q 2022 - Increased primarily due to higher legislated guarantee fees expense due to growth in our 

Single-Family mortgage portfolio, partially offset by lower affordable housing funds allocation as a result of lower 

Single-Family new business activity.

l	 YTD 2023 vs. YTD 2022 - Decreased primarily due to lower affordable housing funds allocation as a result of lower 

Single-Family new business activity, partially offset by higher legislated guarantee fees expense due to growth in our 

Single-Family mortgage portfolio.

Management's Discussion and Analysis Consolidated Results of Operations

Freddie Mac 2Q 2023 Form 10-Q 9
CONSOLIDATED BALANCE SHEETS ANALYSIS

The table below compares our summarized condensed consolidated balance sheets.

Table 7 - Summarized Condensed Consolidated Balance Sheets

Change

(Dollars in millions) June 30, 2023 December 31, 2022 $ %

Assets:

Cash and cash equivalents $5,514 $6,360 ($846) (13) %

Securities purchased under agreements to resell 112,386 87,295 25,091 29 

Investment securities, at fair value 41,629 38,701 2,928 8 

Mortgage loans held-for-sale 11,695 12,197 (502) (4) 

Mortgage loans held-for-investment 3,042,604 3,022,318 20,286 1 

Accrued interest receivable, net 9,081 8,529 552 6 

Deferred tax assets, net 5,237 5,777 (540) (9) 

Other assets 22,810 27,156 (4,346) (16) 

Total assets $3,250,956 $3,208,333 $42,623 1 %

Liabilities and Equity:

Liabilities:

Accrued interest payable $8,049 $7,309 $740 10 %

Debt 3,189,086 3,145,832 43,254 1 

Other liabilities 11,864 18,174 (6,310) (35) 

Total liabilities 3,208,999 3,171,315 37,684 1 

Total equity 41,957 37,018 4,939 13 

Total liabilities and equity $3,250,956 $3,208,333 $42,623 1 %

Key Drivers:

As of June 30, 2023 compared to December 31, 2022: 

n	 Securities purchased under agreements to resell increased to provide additional liquidity due to the uncertainty created 

by the debate about increasing the federal debt ceiling.

n	 Mortgage loans held-for-investment increased primarily due to growth in our Single-Family mortgage portfolio.

n	 Other assets decreased primarily due to a decline in receivables related to U.S. Treasury securities sold but not yet 

settled.

n	 Debt increased due to new debt issuances to provide additional liquidity due to the uncertainty created by the debate 

about increasing the federal debt ceiling, as well as an increase in debt of consolidated trusts driven by growth in our 

Single-Family mortgage portfolio.

n	 Other liabilities decreased primarily due to a decline in payables related to U.S. Treasury securities purchased but not yet 

settled.

Management's Discussion and Analysis Consolidated Balance Sheets Analysis 

Freddie Mac 2Q 2023 Form 10-Q 10
OUR PORTFOLIOS

Mortgage Portfolio

The table below presents the UPB of our mortgage portfolio by segment.

Table 8 - Mortgage Portfolio 

June 30, 2023 December 31, 2022

(In millions) Single-Family Multifamily Total Single-Family Multifamily Total

Mortgage loans held-for-investment:

By consolidated trusts $2,925,576 $39,443 $2,965,019 $2,907,999 $30,574 $2,938,573

By Freddie Mac 35,883 11,866 47,749 33,506 17,805 51,311

Total mortgage loans held-for-investment 2,961,459 51,309 3,012,768 2,941,505 48,379 2,989,884 

Mortgage loans held-for-sale 3,231 9,319 12,550 3,564 9,544 13,108 

Total mortgage loans 2,964,690 60,628 3,025,318 2,945,069 57,923 3,002,992 

Mortgage-related guarantees:

Mortgage loans held by nonconsolidated trusts 30,475 355,723 386,198 31,500 360,869 392,369 

Other mortgage-related guarantees 9,079 10,847 19,926 9,476 10,510 19,986 

Total mortgage-related guarantees 39,554 366,570 406,124 40,976 371,379 412,355 

Total mortgage portfolio $3,004,244 $427,198 $3,431,442 $2,986,045 $429,302 $3,415,347 

Guaranteed mortgage-related securities:

Issued by consolidated trusts $2,938,070 $39,444 $2,977,514 $2,916,038 $30,813 $2,946,851

Issued by nonconsolidated trusts 24,828 315,542 340,370 25,772 319,117 344,889

Total guaranteed mortgage-related securities $2,962,898 $354,986 $3,317,884 $2,941,810 $349,930 $3,291,740 

Investments Portfolio

Our investments portfolio consists of our mortgage-related investments portfolio and our other investments portfolio.

Mortgage-Related Investments Portfolio

The Purchase Agreement limits the size of our mortgage-related investments portfolio to a maximum amount of $225 billion. 

The calculation of mortgage assets subject to the Purchase Agreement cap includes the UPB of mortgage assets and 10% of 

the notional value of interest-only securities. We are also subject to additional limitations on the size and composition of our 

mortgage-related investments portfolio pursuant to FHFA guidance. For additional information on the restrictions on our 

mortgage-related investments portfolio, see the MD&A - Conservatorship and Related Matters section in our 2022 

Annual Report.

Management's Discussion and Analysis Our Portfolios

Freddie Mac 2Q 2023 Form 10-Q 11
The table below presents the details of our mortgage-related investments portfolio.

Table 9 - Mortgage-Related Investments Portfolio 

June 30, 2023 December 31, 2022

(In millions) Single-Family Multifamily Total Single-Family Multifamily Total

Unsecuritized mortgage loans:

Securitization pipeline and other loans $10,888 $21,185 $32,073 $10,093 $27,349 $37,442 

Seasoned loans 28,226 — 28,226 26,977 — 26,977 

Total unsecuritized mortgage loans 39,114 21,185 60,299 37,070 27,349 64,419

Mortgage-related securities:

Investment securities 4,815 5,835 10,650 3,440 6,396 9,836 

Debt of consolidated trusts 16,327 811 17,138 17,939 536 18,475 

Total mortgage-related securities 21,142 6,646 27,788 21,379 6,932 28,311 

Mortgage-related investments portfolio $60,256 $27,831 $88,087 $58,449 $34,281 $92,730 

10% of notional amount of interest-only 

securities $22,994 $21,758

Mortgage-related investments portfolio for 

purposes of Purchase Agreement cap 111,081 114,488

Other Investments Portfolio

The table below presents the details of our other investments portfolio.

Table 10 - Other Investments Portfolio 

June 30, 2023 December 31, 2022

(In millions)

Liquidity and 

Contingency 

Operating 

Portfolio

Custodial 

Account Other

Total Other 

Investments 

Portfolio (1)

Liquidity and 

Contingency 

Operating 

Portfolio

Custodial 

Account Other

Total Other 

Investments 

Portfolio (1)

Cash and cash equivalents $4,721 $700 $93 $5,514 $5,652 $611 $97 $6,360 

Securities purchased under 

agreements to resell 109,307 11,265 982 121,554 88,499 9,703 1,084 99,286 

Non-mortgage-related securities 19,310 — 6,121 25,431 20,188 — 3,645 23,833 

Other assets — — 6,133 6,133 — — 4,565 4,565 

Other investments portfolio $133,338 $11,965 $13,329 $158,632 $114,339 $10,314 $9,391 $134,044 

(1) Represents carrying value.

Management's Discussion and Analysis Our Portfolios

Freddie Mac 2Q 2023 Form 10-Q 12
OUR BUSINESS SEGMENTS

As shown in the table below, we have two reportable segments, which are based on the way we manage our business.

Segment Description

Single-Family 

Reflects results from our purchase, securitization, and guarantee of single-family loans, our investments in single-family 

loans and mortgage-related securities, the management of Single-Family mortgage credit risk and market risk, and any 

results of our treasury function that are not allocated to each segment.

Multifamily Reflects results from our purchase, securitization, and guarantee of multifamily loans, our investments in multifamily loans 

and mortgage-related securities, and the management of Multifamily mortgage credit risk and market risk.

Segment Net Revenues and Net Income 

The charts below show our net revenues and net income by segment. 

Segment Net Revenues 

(In billions)

$5.4 $5.2

$4.8 $4.8

$5.3

$11.3

$10.2

$4.9 $4.4 $4.2 $4.2 $4.4

$10.1

$8.6

$0.5

$0.8 $0.6 $0.6

$1.0

$1.2

$1.6

Single-Family Multifamily

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

Segment Net Income 

(In billions)

$2.5

$1.3

$1.8

$2.0

$2.9

$6.3

$4.9

$2.2

$0.8

$1.5 $1.7

$2.4

$5.6

$4.1

$0.3

$0.5

$0.3

$0.3

$0.6

$0.7

$0.9

Single-Family Multifamily

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

Management's Discussion and Analysis Our Business Segments

Freddie Mac 2Q 2023 Form 10-Q 13
Single-Family 

Business Results

The charts, tables, and related discussion below present the business results of our Single-Family segment.

New Business Activity

UPB of Single-Family Loan Purchases and Guarantees by Loan 

Purpose and Average Estimated Guarantee Fee Rate(1) on New 

Acquisitions

(UPB in billions)

$138

$121

$75

$59

$83

$345

$142

$86

$98

$63 $51

$73

$179

$124

$52 $23

$12

$8

$10

$166

$18

52

54

51

55

57

50

56

Home purchase

Refinance

Average estimated guarantee fee rate

on new acquisitions (bps)

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

(1) Estimated guarantee fee rate calculation excludes the legislated guarantee 

fees and includes deferred fees recognized over the estimated life of the 

related loans. 

Number of Families Helped to Own a Home and Average Loan UPB 

of New Acquisitions

(Loan count in thousands)

468

392

252

190

258

1,159

448

263

297

200 157

217

542

374

205 95

52

33

41

617

74

$294,000

$309,000

$297,000

$310,000

$322,000

$297,000

$317,000

Home purchase borrowers

Refinance borrowers

Average loan UPB of new acquisitions

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

n	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs YTD 2022

l Our loan purchase and guarantee activity slowed due to higher mortgage interest rates. We expect volume for the 

remainder of the year to be lower than 2022 due in part to higher mortgage interest rates.

l The average loan size of new acquisitions increased due to a higher conforming loan limit and house price 

appreciation in recent quarters.

l The average estimated guarantee fee rate on new acquisitions increased primarily due to higher contractual guarantee 

fees and faster expected credit fee recognition driven by higher estimated prepayments on new acquisitions. This 

increase was partially offset by a shift in the business mix of new acquisitions.

For additional information on credit fee changes, see the MD&A - Regulation and Supervision section in this Form 10-Q 

and our 2022 Annual Report.

Management's Discussion and Analysis Our Business Segments | Single-Family

Freddie Mac 2Q 2023 Form 10-Q 14
Single-Family Mortgage Portfolio

Single-Family Mortgage Portfolio and Average Estimated 

Guarantee Fee Rate(1) on Mortgage Portfolio

(UPB in billions)

$2,928

$2,971 $2,986 $2,989 $3,004

47

48 48 48 48

Single-Family mortgage portfolio

Average estimated guarantee fee rate on

mortgage portfolio (bps)

06/30/22 09/30/22 12/31/22 03/31/23 06/30/23

(1) Estimated guarantee fee rate is calculated as of acquisition and excludes 

the legislated guarantee fees. Estimated guarantee fee rate calculation 

also excludes certain loans, the majority of which are held by VIEs that we 

do not consolidate. The UPB of these excluded loans was $42 billion as of 

June 30, 2023.

Single-Family Mortgage Loans

(Loan count in millions) 

13.5 13.6 13.6 13.6 13.6

$217,000

$219,000 $219,000 $219,000 $220,000

Single-Family mortgage portfolio

Average loan UPB

06/30/22 09/30/22 12/31/22 03/31/23 06/30/23

n	 Our Single-Family mortgage portfolio was $3.0 trillion at June 30, 2023, up 3% year-over-year, as portfolio growth has 

moderated in recent periods due to the slowdown in new business activity as both home purchase activity and refinance 

activity slowed due to higher mortgage interest rates.

n	 The average estimated guarantee fee rate on our Single-Family mortgage portfolio increased year-over-year as older 

vintages with lower estimated guarantee fee rates were replaced by acquisitions of new loans with higher estimated 

guarantee fee rates.

Management's Discussion and Analysis Our Business Segments | Single-Family

Freddie Mac 2Q 2023 Form 10-Q 15
CRT Activities

We transfer credit risk on a portion of our Single-Family mortgage portfolio to the private market, reducing the risk of future 

losses to us when borrowers default. The charts below show the issuance amounts associated with CRT transactions for loans 

in our Single-Family mortgage portfolio.

UPB Covered by New CRT Issuance

(In billions)

$151

$136

$58

$15

$56

$358

$71

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

New CRT Issuance Maximum Coverage

(In billions)

$7

$5

$1 $1

$2

$15

$3

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

n	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022 

l The UPB of mortgage loans covered by CRT transactions and related maximum coverage issued during 2Q 2023 and 

YTD 2023 decreased compared to 2Q 2022 and YTD 2022 due to a decrease in loan acquisition activity in recent 

quarters and changes in business strategy and market conditions.

l The percentage of our Single-Family acquisitions that were loans in the targeted population for our CRT transactions 

(primarily 30-year fixed rate loans with LTV ratios between 60% and 97%) increased to 82% during both 2Q 2023 and 

YTD 2023, from 73% and 70% during 2Q 2022 and YTD 2022, respectively, primarily driven by an increase in the 

percentage of recently acquired loans with original LTV ratios above 60% and an increase in the percentage of 30-year 

loan acquisitions. We expect to include a subset of this targeted population in our future CRT transactions.

See MD&A - Risk Management - Single-Family Mortgage Credit Risk - Transferring Credit Risk to Third-Party 

Investors for additional information on our CRT activities and other credit enhancements.

Management's Discussion and Analysis Our Business Segments | Single-Family

Freddie Mac 2Q 2023 Form 10-Q 16
Loss Mitigation Activities 

The following chart provides details about the single-family loan workout activities that were completed during the periods 

presented. 

Completed Loan Workout Activity

(UPB in billions, number of loan workouts in thousands)

37

28

22

24

20

86

44

8 6 6 7 6

18

13

16

12 10

11

9

39

20

13

10

6

6

5

29

11

$9

$6

$5 $5 $5

$20

$10

Forbearance and other(1) Payment deferral plans Loan modifications Total UPB

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

(1) The forbearance data is limited to loans in forbearance that are past due based on the loans' original contractual terms and excludes both loans for 

which we do not control servicing and loans included in certain legacy transactions, as the forbearance data for such loans is either not reported to 

us by the servicers or is otherwise not readily available to us. Other includes repayment plans and foreclosure alternatives. 

n Completed loan workout activity includes forbearance plans where borrowers fully reinstated the loan to current status 

during or at the end of the forbearance period, payment deferral plans, loan modifications, successfully completed 

repayment plans, short sales, and deeds in lieu of foreclosure. Completed loan workout activity excludes active loss 

mitigation activity that was ongoing and had not been completed as of the end of the period, such as forbearance plans 

that had been initiated but not completed and trial period modifications. There were approximately 22,000 loans in active 

forbearance plans and approximately 13,000 loans in other active loss mitigation activity as of June 30, 2023.

n 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022 - Our loan workout activity decreased as the seriously delinquent loan 

population continued to decline.

Management's Discussion and Analysis Our Business Segments | Single-Family

Freddie Mac 2Q 2023 Form 10-Q 17
Financial Results 

The table below presents the results of operations for our Single-Family segment. See Note 11 for additional information about 

segment financial results.

Table 11 - Single-Family Segment Financial Results 

Change Change

(Dollars in millions) 2Q 2023 2Q 2022 $ % YTD 2023 YTD 2022 $ %

Net interest income $4,295 $4,535 ($240) (5) % $8,591 $8,341 $250 3 %

Non-interest income 65 336 (271) (81) (28) 1,744 (1,772) (102) 

Net revenues 4,360 4,871 (511) (10) 8,563 10,085 (1,522) (15) 

(Provision) benefit for credit losses 638 (298) 936 314 320 533 (213) (40) 

Non-interest expense (2,028) (1,854) (174) (9) (3,811) (3,632) (179) (5) 

Income before Income tax expense 2,970 2,719 251 9 5,072 6,986 (1,914) (27) 

Income tax expense (589) (551) (38) (7) (1,014) (1,407) 393 28 

Net income 2,381 2,168 213 10 4,058 5,579 (1,521) (27) 

Other comprehensive income (loss), net of taxes and 

reclassification adjustments 2 5 (3) (60) 1 (7) 8 114 

Comprehensive income $2,383 $2,173 $210 10 % $4,059 $5,572 ($1,513) (27) %

Key Business Drivers:

n	2Q 2023 vs. 2Q 2022

l Net income of $2.4 billion, up 10% year-over-year.

– Net revenues were $4.4 billion, down 10% year-over-year. Net interest income was $4.3 billion, down 5% yearover-year, primarily driven by lower deferred fee income due to slower prepayments as a result of higher 

mortgage interest rates.

– The benefit for credit losses was $0.6 billion for 2Q 2023, primarily driven by a credit reserve release due to 

improvements in observed and forecasted house price appreciation. The provision for credit losses of $0.3 billion

for 2Q 2022 was primarily driven by a credit reserve build due to portfolio growth and deterioration in forecasted 

economic conditions.

n	YTD 2023 vs. YTD 2022

l Net income of $4.1 billion, down 27% year-over-year.

– Net revenues were $8.6 billion, down 15% year-over-year.

◦ Net interest income was $8.6 billion for YTD 2023, up 3% year-over-year, primarily driven by mortgage 

portfolio growth, higher average portfolio guarantee fee rates, and higher investments net interest income 

due to higher interest rates. These increases were partially offset by lower deferred fee income due to 

slower prepayments as a result of higher mortgage interest rates.

◦ Non-interest income of $1.7 billion for YTD 2022 was primarily driven by spread-related gains on 

commitments to hedge the securitization pipeline during that period.

– The benefit for credit losses was $0.3 billion and $0.5 billion for YTD 2023 and YTD 2022, respectively. The benefit 

for credit losses for YTD 2023 was primarily driven by a credit reserve release due to improvements in forecasted 

house price appreciation. The benefit for credit losses for YTD 2022 was primarily driven by a credit reserve 

release due to improvements in observed house price appreciation.

Management's Discussion and Analysis Our Business Segments | Single-Family

Freddie Mac 2Q 2023 Form 10-Q 18
Multifamily 

Business Results

The charts, tables, and related discussion below present the business results of our Multifamily segment.

New Business Activity

New Business Activity 

 (In billions) 

$15

$14

$29

$6

$13

$30

$19

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

 Total Number of Rental Units Financed(1)

 (In thousands)

148 150

252

60

114

291

174

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

 (1) Includes rental units financed by supplemental loans.

n	 As of June 30, 2023, the Multifamily new business activity was $19 billion, down 37% year-over-year, as our new business 

activity was lower as higher mortgage interest rates and greater market uncertainty have reduced demand for multifamily 

financing. Approximately 66% of this activity, based on UPB, was mission-driven, affordable housing.

n	 Our index lock agreements and outstanding commitments to purchase or guarantee multifamily assets were $17.1 billion

and $19.4 billion as of June 30, 2023 and June 30, 2022, respectively.

Management's Discussion and Analysis Our Business Segments | Multifamily

Freddie Mac 2Q 2023 Form 10-Q 19
Multifamily Mortgage Portfolio and Guarantee Portfolio

 Mortgage Portfolio

 (In billions) $415 $416

$429 $426 $427

6/30/22 09/30/22 12/31/22 3/31/23 6/30/23

 

 Guarantee Portfolio

 (In billions) $356 $357 $360 $362

$366

43 43 43

44

45

UPB of guarantee portfolio

Average guarantee fee rate charged (bps)

6/30/22 09/30/22 12/31/22 3/31/23 6/30/23

n	 Our Multifamily mortgage portfolio was $427 billion at June 30, 2023, up 3% year-over-year, as portfolio growth has 

moderated in recent periods due to the slowdown in new business activity. Our guarantee portfolio was $366 billion at 

June 30, 2023, up 3% year-over-year, as our new securitization activities outpaced payoffs.

n	 In addition to our Multifamily mortgage portfolio, we have investments in LIHTC fund partnerships with carrying values 

totaling $3.0 billion and $2.8 billion as of June 30, 2023 and December 31, 2022, respectively. 

Management's Discussion and Analysis Our Business Segments | Multifamily

Freddie Mac 2Q 2023 Form 10-Q 20
CRT Activities

 UPB Covered by New CRT Issuance New CRT Issuance Maximum Coverage 

 (In billions) (In billions)

$21

$11

$16

$8

$16

$35

$24

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

 $1.3

$0.8

$1.0

$0.6

$0.9

$2.3

$1.5

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

n	 2Q 2023 vs. 2Q 2022 and YTD 2023 vs. YTD 2022

l The UPB of mortgage loans covered by new CRT transactions and the maximum coverage decreased primarily due to 

fewer securitizations with subordination as a result of a smaller average held-for-sale securitization pipeline.

See MD&A - Risk Management - Multifamily Mortgage Credit Risk - Transferring Credit Risk to Third-Party 

Investors for more information on risk transfer transactions and credit enhancements on our Multifamily mortgage portfolio.

Management's Discussion and Analysis Our Business Segments | Multifamily

Freddie Mac 2Q 2023 Form 10-Q 21
Financial Results

The table below presents the results of operations for our Multifamily segment. See Note 11 for additional information about 

segment financial results.

Table 12 - Multifamily Segment Financial Results 

Change Change

(Dollars in millions) 2Q 2023 2Q 2022 $ % YTD 2023 YTD 2022 $ %

Net interest income $228 $224 $4 2 % $433 $522 ($89) (17) %

Non-interest income 751 309 442 143 1,170 643 527 82 

Net revenues 979 533 446 84 1,603 1,165 438 38 

(Provision) benefit for credit losses (101) (9) (92) (1,022) (178) (3) (175) (5,833) 

Non-interest expense (176) (166) (10) (6) (325) (320) (5) (2) 

Income before income tax expense 702 358 344 96 1,100 842 258 31 

Income tax expense (139) (73) (66) (90) (219) (170) (49) (29) 

Net income 563 285 278 98 881 672 209 31 

Other comprehensive income (loss), net of 

taxes and reclassification adjustments (56) (71) 15 21 (1) (179) 178 99 

Comprehensive income $507 $214 $293 137 % $880 $493 $387 78 %

Key Business Drivers:

n	 2Q 2023 vs. 2Q 2022

l Net income of $0.6 billion, up 98% year-over-year.

– Net revenues were $1.0 billion, up 84% year-over-year. 

– Non-interest income was $0.8 billion, up 143% year-over-year, driven by higher guarantee income and 

higher net investment gains. Guarantee income increased primarily due to lower fair value losses on 

guarantee assets as a result of smaller interest rate increases. Net investment gains increased primarily 

due to fair value gains from interest-rate risk management activities.

– Provision for credit losses was $0.1 billion for 2Q 2023, driven by a credit reserve build due to deterioration in 

forecasted multifamily market conditions and current loan performance.

n	 YTD 2023 vs. YTD 2022

l Net income of $0.9 billion, up 31% year-over-year.

– Net revenues were $1.6 billion, up 38% year-over-year. 

– Net interest income was $0.4 billion, down 17% year-over-year, primarily due to lower prepayment 

income driven by higher mortgage interest rates.

– Non-interest income was $1.2 billion, up 82% year-over-year, driven by higher guarantee income and 

higher net investment gains. Guarantee income increased primarily due to lower fair value losses on 

guarantee assets as a result of smaller interest rate increases. Net investment gains increased primarily 

due to fair value gains from interest rate risk management activities.

– Provision for credit losses was $0.2 billion for YTD 2023, driven by a credit reserve build due to increased 

uncertainty in forecasted economic conditions and multifamily market conditions as well as deterioration in loan 

performance.

Management's Discussion and Analysis Our Business Segments | Multifamily

Freddie Mac 2Q 2023 Form 10-Q 22
RISK MANAGEMENT

To achieve our mission, we take risks as an integral part of our business activities. We are exposed to the following key types of 

risk: credit risk, market risk, liquidity risk, operational risk, compliance risk, legal risk, strategic risk, and reputation risk.

Credit Risk

Allowance for Credit Losses

The tables below present a summary of the changes in our allowance for credit losses and key allowance for credit losses 

ratios.

Table 13 - Allowance for Credit Losses Activity

2Q 2023 2Q 2022 YTD 2023 YTD 2022

(Dollars in 

millions) 

SingleFamilyMultifamily TotalSingleFamilyMultifamily TotalSingleFamilyMultifamily TotalSingleFamilyMultifamily Total

Allowance for credit losses:

Beginning 

balance $8,097 $224 $8,321 $4,849 $72 $4,921 $7,746 $147 $7,893 $5,440 $78 $5,518 

Provision (benefit) 

for credit losses (638) 101 (537) 298 9 307 (320) 178 (142) (533) 3 (530) 

 Charge-offs (111) — (111) (107) — (107) (201) — (201) (280) — (280) 

 Recoveries 

collected 29 — 29 43 — 43 61 — 61 95 — 95 

Net charge-offs (82) — (82) (64) — (64) (140) — (140) (185) — (185) 

Other(1) 80 — 80 259 — 259 171 — 171 620 — 620 

Ending balance $7,457 $325 $7,782 $5,342 $81 $5,423 $7,457 $325 $7,782 $5,342 $81 $5,423 

Average loans 

outstanding 

during the 

period(2) $2,991,397 $48,309 $3,039,706 $2,917,015 $29,805 $2,946,820 $2,988,562 $48,029 $3,036,591 $2,892,734 $28,942 $2,921,676

Net charge-offs to 

average loans 

outstanding — % — % — % — % — % — % — % — % — % 0.01 % — % 0.01 %

Components of ending balance of allowance for credit losses:

Mortgage loans 

held-forinvestment $7,088 $251 $7,339 $4,904 $35 $4,939 

Other(3) 369 74 443 438 46 484 

Total ending 

balance $7,457 $325 $7,782 $5,342 $81 $5,423 

(1) Primarily includes capitalization of past due interest related to non-accrual loans that received payment deferral plans and loan modifications.

(2) Based on amortized cost basis of held-for-investment loans for which we have not elected the fair value option.

(3) Includes allowance for credit losses related to advances of pre-foreclosure costs, accrued interest receivable on mortgage loans, and off-balance sheet credit 

exposures. 

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 23
Table 14 - Allowance for Credit Losses Ratios

June 30, 2023 December 31, 2022

(Dollars in millions) Single-Family Multifamily Total Single-Family Multifamily Total

Allowance for credit losses ratios:

Allowance for credit losses(1) to total loans outstanding 0.24 % 0.50 % 0.24 % 0.25 % 0.16 % 0.24 %

Non-accrual loans to total loans outstanding 0.43 0.11 0.42 0.34 0.09 0.33 

Allowance for credit losses to non-accrual loans 55.15 448.21 56.86 72.45 183.33 72.91 

Balances:

Allowance for credit losses on mortgage loans held-forinvestment $7,088 $251 $7,339 $7,314 $77 $7,391 

Total loans outstanding(2) 2,998,784 49,800 3,048,584 2,981,401 47,094 3,028,495 

Non-accrual loans(2) 12,852 56 12,908 10,095 42 10,137 

(1) Represents allowance for credit losses on held-for-investment loans for which we have not elected the fair value option.

(2) Based on amortized cost basis of held-for-investment loans for which we have not elected the fair value option.

The ratio of allowance for credit losses to non-accrual loans decreased as of June 30, 2023 compared to December 31, 2022, 

primarily driven by a credit reserve release in Single-Family due to improvements in forecasted house price appreciation.

Single-Family Mortgage Credit Risk

Maintaining Prudent Underwriting Standards and Quality Control Practices and 

Managing Seller/Servicer Performance 

Loan Purchase Credit Characteristics

We monitor and evaluate market conditions that could affect the credit quality of our single-family loan purchases. Additionally, 

when managing our new acquisitions, we consider our risk limits and guidance from FHFA and capital requirements under the 

ERCF. This may affect the volume and characteristics of our loan acquisitions.

The charts below show the credit profile of the single-family loans we purchased or guaranteed. The average original LTV 

increased year-over-year due to the increase in the percentage of loan acquisitions related to home purchases as home 

purchase loans typically have higher LTV ratios than refinance loans. The percentage of loans with a DTI ratio greater than 45% 

also increased year-over-year due to changes in market conditions, such as increasing house prices and higher mortgage 

interest rates in recent quarters, and changes in our purchase guidelines in support of mission-driven activities.

We have observed an increase in serious delinquency rates on certain recently acquired loans. We have updated our purchase 

guidelines on refinance loans with certain higher risk characteristics that are designed to partially balance our credit risk 

exposure while supporting affordable housing in a responsible manner.

Weighted Average Original LTV Ratio 

75%

78% 78% 79% 79%

73%

79%

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

Weighted Average Original Credit Score(1) 

744

747 747

749

751

745

750

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

(1) Weighted average original credit score is generally based on three credit 

bureaus (Equifax, Experian, and TransUnion).

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 24
The table below contains additional information about the single-family loans we purchased or guaranteed.

Table 15 - Single-Family New Business Activity 

2Q 2023 2Q 2022 YTD 2023 YTD 2022

(Dollars in millions) Amount

% of 

Total Amount

% of 

Total Amount

% of 

Total Amount

% of 

Total

20- and 30-year or more, amortizing fixed-rate $78,730 95 % $124,910 91 % $134,199 95 % $306,887 89 %

15-year or less, amortizing fixed-rate 3,038 4 11,084 8 5,252 4 34,568 10 

Adjustable-rate 1,082 1 1,671 1 2,364 1 3,298 1 

Total $82,850 100 % $137,665 100 % $141,815 100 % $344,753 100 %

Percentage of purchases

DTI ratio > 45% 26 % 17 % 25 % 16 %

Original LTV ratio > 90% 27 19 27 16 

Transaction type:

Cash window 30 30 29 27 

Guarantor swap 70 70 71 73 

Property type:

Detached single-family houses and townhouses 91 92 91 93 

Condominium or co-op 9 8 9 7 

Occupancy type:

Primary residence 92 90 92 89 

Second home 2 2 2 4 

Investment property 6 8 6 7 

Loan purpose:

Purchase 88 62 87 52 

Cash-out refinance 8 28 9 31 

 Other refinance 4 10 4 17 

Transferring Credit Risk to Third-Party Investors 

To reduce our credit risk exposure, we engage in various credit enhancement arrangements, which include CRT transactions 

and other credit enhancements.

Single-Family Mortgage Portfolio CRT Issuance

The table below provides the UPB of the mortgage loans covered by CRT transactions issued during the periods presented as 

well as the maximum coverage provided by those transactions.

Table 16 - Single-Family Mortgage Portfolio CRT Issuance

2Q 2023 2Q 2022

(In millions) UPB(1)

Maximum 

Coverage(2) UPB(1)

Maximum 

Coverage(2)

STACR $48,444 $1,591 $111,412 $4,783 

ACIS 7,593 293 37,700 1,489 

Other 74 74 1,551 248 

Total CRT issuance $56,111 $1,958 $150,663 $6,520 

Referenced footnotes are included after the year-to-date table.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 25
YTD 2023 YTD 2022

(In millions) UPB(1)

Maximum 

Coverage(2) UPB(1)

Maximum 

Coverage(2)

STACR $63,331 $2,202 $234,974 $9,871 

ACIS 7,593 293 121,691 4,715 

Other 120 120 1,697 394 

Total CRT issuance $71,044 $2,615 $358,362 $14,980 

(1) Represents the UPB of the assets included in the associated reference pool or securitization trust, as applicable.

(2) For STACR transactions, represents the balance held by third parties at issuance. For ACIS transactions, represents the aggregate limit of insurance purchased from 

third parties at issuance.

Single-Family Mortgage Portfolio Credit Enhancement Coverage Outstanding

The table below provides information on the UPB and maximum coverage associated with credit-enhanced loans in our SingleFamily mortgage portfolio.

Table 17 - Single-Family Mortgage Portfolio Credit Enhancement Coverage Outstanding 

June 30, 2023

(Dollars in millions) UPB(1) % of Portfolio Maximum Coverage(2)

Primary mortgage insurance(3) $624,103 21% $160,625 

STACR 1,209,492 40 34,255 

ACIS 862,924 29 18,561 

Other 40,380 1 11,097 

Less: UPB with multiple credit enhancements and other reconciling items(4) (873,061) (29) — 

Single-Family mortgage portfolio - credit-enhanced 1,863,838 62 224,538 

Single-Family mortgage portfolio - non-credit-enhanced 1,140,406 38 N/A

Total $3,004,244 100% $224,538 

December 31, 2022

(Dollars in millions) UPB(1) % of Portfolio Maximum Coverage(2)

Primary mortgage insurance(3) $609,123 21% $155,022 

STACR 1,188,017 40 35,111 

ACIS 938,409 31 19,774 

Other 41,572 1 11,105 

Less: UPB with multiple credit enhancements and other reconciling items(4) (945,062) (32) — 

Single-Family mortgage portfolio - credit-enhanced 1,832,059 61 221,012 

Single-Family mortgage portfolio - non-credit-enhanced 1,153,986 39 N/A

Total $2,986,045 100% $221,012 

(1) Represents the current UPB of the assets included in the associated reference pool or securitization trust, as applicable. 

(2) For STACR transactions, represents the outstanding balance held by third parties. For ACIS transactions, represents the remaining aggregate limit of insurance 

purchased from third parties. 

(3) Amounts exclude certain loans for which we do not control servicing, as the coverage information for these loans is not readily available to us.

(4) Other reconciling items primarily include timing differences in reporting cycles between the UPB of certain CRT transactions and the UPB of the underlying loans. 

Credit Enhancement Coverage Characteristics

The table below provides the serious delinquency rates for the credit-enhanced and non-credit-enhanced loans in our SingleFamily mortgage portfolio. The credit-enhanced categories are not mutually exclusive as a single loan may be covered by both 

primary mortgage insurance and other credit enhancements.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 26
Table 18 - Serious Delinquency Rates for Credit-Enhanced and Non-Credit-Enhanced Loans in Our Single-Family 

Mortgage Portfolio

June 30, 2023 December 31, 2022

(% of portfolio based on UPB)(1) % of Portfolio(2) SDQ Rate % of Portfolio(2) SDQ Rate

Credit-enhanced:

 Primary mortgage insurance 21 % 0.91 % 21 % 1.05 %

 CRT and other 56 0.58 56 0.68 

Non-credit-enhanced 38 0.48 39 0.57 

Total N/A 0.56 N/A 0.66 

(1) Excludes loans underlying certain securitization products for which loan-level data is not available.

(2) Percentages do not total to 100% as a single loan may be included in multiple line items.

Credit Enhancement Recoveries 

Our expected recovery receivable from freestanding credit enhancements, net of allowance, was $0.3 billion and $0.4 billion as 

of June 30, 2023 and December 31, 2022, respectively.

Monitoring Loan Performance and Characteristics 

We review loan performance, including delinquency statistics and related loan characteristics, in conjunction with housing 

market and economic conditions, to assess credit risk when estimating our allowance for credit losses. We also use this 

information to determine if our pricing and eligibility standards reflect the risk associated with the loans we purchase and 

guarantee.

Loan Characteristics 

The table below contains details of the characteristics of the loans in our Single-Family mortgage portfolio. 

Table 19 - Credit Quality Characteristics of Our Single-Family Mortgage Portfolio 

June 30, 2023

(Dollars in millions) UPB

Original Credit

Score (1)

Current Credit

Score(1)(2)

Original

LTV Ratio

Current

LTV

Ratio

Single-Family mortgage portfolio year of origination:

 2023 $114,995 750 748 79 % 78 %

 2022 447,722 745 746 76 72 

 2021 1,019,158 752 757 71 57 

 2020 747,307 761 768 71 49 

 2019 125,312 746 753 76 48 

 2018 and prior 549,750 737 751 75 34 

Total $3,004,244 750 756 73 54 

December 31, 2022

(Dollars in millions) UPB

Original Credit

Score (1)

Current Credit

Score(1)(2)

Original

LTV Ratio

Current

LTV

Ratio

Single-Family mortgage portfolio year of origination:

 2022 $438,339 745 742 76 % 74 %

 2021 1,054,844 752 758 71 59 

 2020 776,425 761 766 71 51 

 2019 131,637 746 752 76 50 

 2018 52,921 736 736 76 47 

 2017 and prior 531,879 737 752 75 34 

Total $2,986,045 750 756 73 54 

(1) Original credit score is generally based on three credit bureaus (Equifax, Experian, and TransUnion). Current credit score is based on Experian only.

(2) Credit scores for certain recently acquired loans may not have been updated by the credit bureau since the loan acquisition, and therefore the original credit scores 

also represent the current credit scores.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 27
The following table presents the combination of credit score and CLTV ratio attributes of loans in our Single-Family mortgage 

portfolio.

Table 20 - Single-Family Mortgage Portfolio Attribute Combinations(1)

June 30, 2023

CLTV ≤ 60 CLTV > 60 to 80 CLTV > 80 to 90 CLTV > 90 to 100 CLTV > 100 All Loans

Original credit 

score

% of 

Portfolio SDQ Rate

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate

740 and above 6

2

 42 % 0.17 % 17 % 0.23 % 4 % 0.27 % 2 % 0.23 % — % NM 65 % 0.19 %

700 to 739 13 0.56 6 0.72 1 0.75 1 0.57 — NM 21 0.61

680 to 699 4 0.93 2 1.27 — NM — NM — NM 6 1.03

660 to 679 3 1.36 1 1.76 — NM — NM — NM 4 1.46

620 to 659 2 2.07 1 2.81 — NM — NM — NM 3 2.21

Less than 620 1 4.77 — NM — NM — NM — NM 1 5.19

Total 65 % 0.53 27 % 0.63 5 % 0.64 3 % 0.48 — % NM 100 % 0.56

December 31, 2022

CLTV ≤ 60 CLTV > 60 to 80 CLTV > 80 to 90 CLTV > 90 to 100 CLTV > 100 All Loans

Original credit 

score

% of 

Portfolio SDQ Rate

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate(2)

% of 

Portfolio SDQ Rate

740 and above 40 % 0.22 % 18 % 0.25 % 4 % 0.23 % 2 % 0.16 % — % NM 64 % 0.23 %

700 to 739 12 0.70 6 0.75 2 0.72 1 0.38 — NM 21 0.71 

680 to 699 5 1.16 2 1.28 — NM — NM — NM 7 1.18 

660 to 679 3 1.65 1 1.77 — NM — NM — NM 4 1.68 

620 to 659 2 2.46 1 2.78 — NM — NM — NM 3 2.54 

Less than 620 1 5.97 — NM — NM — NM — NM 1 6.52 

Total 63 % 0.66 28 % 0.67 6 % 0.60 3 % 0.37 — % NM 100 % 0.66

(1) Excludes loans underlying certain securitization products for which original credit score is not available.

(2) NM - not meaningful due to the percentage of the portfolio rounding to zero.

Geographic Concentrations

We purchase mortgage loans from across the U.S. However, local economic conditions can affect the borrower's ability to 

repay and the value of the underlying collateral, leading to concentrations of credit risk in certain geographic areas. In addition, 

certain states and municipalities have passed or may pass laws that limit our ability to foreclose or evict and make it more 

difficult and costly to manage our risk.

See Note 12 for more information about the geographic distribution of our Single-Family mortgage portfolio.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 28
Delinquency Rates 

We report Single-Family delinquency rates based on the number of loans in our Single-Family mortgage portfolio that are past 

due as reported to us by our servicers as a percentage of the total number of loans in our Single-Family mortgage portfolio. 

The chart below shows the delinquency rates of mortgage loans in our Single-Family mortgage portfolio.

Single-Family Delinquency Rates

0.81% 0.79%

0.94%

0.76%

0.88%

0.19% 0.20%

0.24%

0.20% 0.21%

0.76%

0.67% 0.66%

0.62%

0.56%

One month past due Two months past due Seriously delinquent

2Q22 3Q22 4Q22 1Q23 2Q23

Our Single-Family serious delinquency rate has declined below pre-pandemic levels to 0.56% as of June 30, 2023, compared 

to 0.76% as of June 30, 2022. See Note 3 for additional information on the payment status of our single-family mortgage 

loans.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 29
Multifamily Mortgage Credit Risk

Maintaining Policies and Procedures for New Business Activity, Including Prudent 

Underwriting Standards

Our underwriting standards focus on the LTV ratio and DSCR, which estimates a borrower's ability to repay the loan using the 

secured property's cash flows, after expenses. The charts below provide the weighted average original LTV and DSCR for our 

new business activity for the periods presented. 

Weighted Average Original LTV Ratio 

63%

59% 58% 57% 58%

65%

58%

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

 Weighted Average Original DSCR

1.33 1.31

1.25 1.27 1.27

1.33

1.27

2Q22 3Q22 4Q22 1Q23 2Q23 YTD22 YTD23

Transferring Credit Risk to Third-Party Investors 

To reduce our credit risk exposure, we engage in a variety of CRT activities; however, securitizations remain our principal credit 

risk transfer mechanism. Through securitizations (i.e., subordination), we have transferred a substantial amount of the expected 

and stressed credit risk on the Multifamily mortgage portfolio, thereby reducing our overall credit risk exposure and required 

capital.

Multifamily Mortgage Portfolio CRT Issuance

The table below provides the UPB of the mortgage loans covered by CRT transactions issued during the periods presented as 

well as the maximum coverage provided by those transactions.

Table 21 - Multifamily Mortgage Portfolio CRT Issuance

2Q 2023 2Q 2022 YTD 2023 YTD 2022

(In millions) UPB(1)

Maximum 

Coverage(2) UPB(1)

Maximum 

Coverage(2) UPB(1)

Maximum 

Coverage(2) UPB(1)

Maximum 

Coverage(2)

Subordination $8,626 $610 $14,781 $940 $14,775 $1,035 $28,886 $1,914 

SCR 7,636 102 5,982 141 8,802 207 5,982 141 

MCIP 7,636 188 5,982 200 7,636 188 5,982 200 

Lender risk-sharing 321 32 214 26 560 80 214 26 

Less: UPB with more 

than one type of CRT (7,636) — (5,982) — (7,636) — (5,982) — 

Total CRT issuance $16,583 $932 $20,977 $1,307 $24,137 $1,510 $35,082 $2,281 

(1) Represents the UPB of the assets included in the associated reference pool or securitization trust, as applicable.

(2) For subordination, represents the UPB of the securities that are held by third parties at issuance and are subordinate to the securities we guarantee. For SCR 

transactions, represents the UPB of securities held by third parties at issuance. For MCIP transactions, represents the aggregate limit of insurance purchased from 

third parties at issuance. For lender risk-sharing, represents the amount of loss recovery that is available subject to the terms of counterparty agreements at 

issuance.

Multifamily Mortgage Portfolio Credit Enhancement Coverage Outstanding

While we obtain various forms of credit protection in connection with the acquisition, guarantee, and/or securitization of a loan 

or group of loans, our principal credit enhancement type is subordination, which is created through our senior subordinate 

securitization transactions. As of June 30, 2023 and December 31, 2022, our maximum coverage provided by subordination in 

nonconsolidated VIEs was $40.2 billion and $41.7 billion, respectively. 

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 30
The table below presents the UPB and delinquency rates for both credit-enhanced and non-credit-enhanced loans underlying 

our Multifamily mortgage portfolio.

Table 22 - Credit-Enhanced and Non-Credit-Enhanced Loans Underlying Our Multifamily Mortgage Portfolio

June 30, 2023 December 31, 2022

(Dollars in millions) UPB Delinquency Rate UPB Delinquency Rate

Credit-enhanced:

Subordination $353,800 0.21 % $358,813 0.12 %

Other 47,762 0.26 38,870 0.12 

Total credit-enhanced 401,562 0.22 397,683 0.12 

Non-credit-enhanced 25,636 0.16 31,619 0.08 

Total $427,198 0.21 $429,302 0.12 

The Multifamily delinquency rate increased to 0.21% at June 30, 2023, primarily driven by an increase in delinquent loans in our 

senior housing loan portfolio. 95% of the delinquent loans in the Multifamily mortgage portfolio have credit enhancement 

coverage while 94% of all loans in the Multifamily mortgage portfolio have credit enhancement coverage.

The table below contains details on the loans underlying our Multifamily mortgage portfolio that are not credit-enhanced.

Table 23 - Credit Quality of Our Multifamily Mortgage Portfolio Without Credit Enhancement

June 30, 2023 December 31, 2022

(Dollars in millions) UPB Delinquency Rate UPB Delinquency Rate

Mortgage loans held-for-sale $8,317 — % $9,138 0.29 %

Mortgage loans held-for-investment:

 Held by Freddie Mac 10,219 0.28 15,468 — 

 Held by consolidated trusts 4,845 0.27 4,665 — 

Other mortgage-related guarantees 2,255 — 2,348 — 

Total $25,636 0.16 $31,619 0.08 

Market Risk

Overview

Our business segments have embedded exposure to market risk, which is the economic risk associated with adverse changes 

in interest rates, volatility, and spreads. Market risk can adversely affect future cash flows, or economic value, as well as 

earnings and net worth. The primary sources of interest-rate risk are our investments in mortgage-related assets, the debt we 

issue to fund these assets, and our Single-Family guarantees. 

Interest-Rate Risk

Our primary interest-rate risk measures are duration gap and Portfolio Value Sensitivity (PVS). Duration gap measures the 

difference in price sensitivity to interest rate changes between our financial assets and liabilities and is expressed in months 

relative to the value of assets. PVS is an estimate of the change in the present value of the cash flows of our financial assets 

and liabilities from an instantaneous shock to interest rates, assuming spreads are held constant and no rebalancing actions 

are undertaken. PVS is measured in two ways, one measuring the estimated sensitivity of our portfolio value to a 50 basis point 

parallel movement in interest rates (PVS-L) and the other to a non-parallel movement resulting from a 25 basis point change in 

the slope of the yield curve (PVS-YC). While we believe that duration gap and PVS are useful risk management tools, they 

should be understood as estimates rather than as precise measurements.

The following tables provide our duration gap, estimated point-in-time and minimum and maximum PVS-L and PVS-YC results, 

and an average of the daily values and standard deviation. The table below also provides PVS-L estimates assuming an 

immediate 100 basis point shift in the yield curve. The interest-rate sensitivity of a mortgage portfolio varies across a wide 

range of interest rates.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 31
Table 24 - PVS-YC and PVS-L Results Assuming Shifts of the Yield Curve

June 30, 2023 December 31, 2022

PVS-YC PVS-L PVS-YC PVS-L

(In millions) 25 bps 50 bps 100 bps 25 bps 50 bps 100 bps

Assuming shifts of the yield curve, (gains) 

losses on:(1)

Assets:

Investments $381 $3,170 $6,225 $362 ($3,131) ($6,340) 

Guarantees(2) (77) (493) (947) (93) 512 1,090 

Total assets 304 2,677 5,278 269 (2,619) (5,250) 

Liabilities 87 (1,802) (3,635) 68 1,958 3,912 

Derivatives (389) (895) (1,749) (336) 648 1,278 

Total $2 ($20) ($106) $1 ($13) ($60) 

PVS $2 $— $— $1 $— $— 

(1) The categorization of the PVS impact between assets, liabilities, and derivatives on this table is based upon the economic characteristics of those assets and 

liabilities, not their accounting classification. For example, purchase and sale commitments of mortgage-related securities and debt of consolidated trusts held by 

the mortgage-related investments portfolio are both categorized as assets on this table.

(2) Represents the interest-rate risk from our guarantees, which include buy-ups, float, and upfront fees (including buy-downs). 

Table 25 - Duration Gap and PVS Results

2Q 2023 2Q 2022

(Duration gap in months, dollars in millions)

Duration

Gap

PVS-YC

25 bps

PVS-L

50 bps

Duration

Gap

PVS-YC

25 bps

PVS-L

50 bps

Average 0.1 $2 $5 (0.1) $7 $6 

Minimum (0.1) — — (0.4) — — 

Maximum 0.3 6 31 0.1 18 29 

Standard deviation 0.1 2 9 0.1 5 9 

YTD 2023 YTD 2022

(Duration gap in months, dollars in millions)

Duration

Gap

PVS-YC

25 bps

PVS-L

50 bps

Duration

Gap

PVS-YC

25 bps

PVS-L

50 bps

Average — $2 $4 — $8 $8 

Minimum (0.2) — — (0.4) — — 

Maximum 0.3 9 31 0.4 18 77 

Standard deviation 0.1 2 8 0.2 5 15 

Derivatives enable us to reduce our economic interest-rate risk exposure as we continue to align our derivative portfolio with 

the changing duration of our economically hedged assets and liabilities. The table below shows that the PVS-L risk levels, 

assuming a 50 basis point shift in the yield curve for the periods presented, would have been higher if we had not used 

derivatives.

Table 26 - PVS-L Results Before Derivatives and After Derivatives

PVS-L (50 bps)

(In millions)

Before

Derivatives

After

Derivatives

Effect of

Derivatives

June 30, 2023 874 — (874) 

December 31, 2022(1) 645 — (645) 

(1) Before derivatives, our adverse PVS-L rate movement was -50 whereas after derivatives our adverse PVS-L rate movement was +50 bps.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 32
Earnings Sensitivity to Market Risk

The accounting treatment for our financial assets and liabilities (i.e., some are measured at amortized cost, while others are 

measured at fair value) creates variability in our GAAP earnings when interest rates and spreads change. We manage this 

variability of GAAP earnings, which may not reflect the economics of our business, using fair value hedge accounting. See 

MD&A - Consolidated Results of Operations and MD&A - Our Business Segments for additional information on the 

effect of changes in interest rates and market spreads on our financial results.

Interest Rate-Related Earnings Sensitivity

While we manage our interest-rate risk exposure on an economic basis to a low level as measured by our models, changes in 

interest rates may still result in significant earnings variability from period to period.

By electing fair value hedge accounting for certain single-family mortgage loans and certain debt instruments, we are able to 

reduce the potential variability in our earnings attributable to changes in interest rates. See Note 8 for additional information on 

hedge accounting.

Earnings Sensitivity to Changes in Interest Rates

We evaluate a range of interest rate scenarios to determine the sensitivity of our earnings due to changes in interest rates and 

to determine our fair value hedge accounting strategies. The interest rate scenarios evaluated include parallel shifts in the yield 

curve in which interest rates increase or decrease by 100 basis points, non-parallel shifts in the yield curve in which long-term 

interest rates increase or decrease by 100 basis points, and non-parallel shifts in the yield curve in which short-term and 

medium-term interest rates increase or decrease by 100 basis points. This evaluation identifies the net effect on comprehensive 

income from changes in fair value attributable to changes in interest rates for financial instruments measured at fair value 

recognized on our condensed consolidated balance sheets at period end, including the effects of fair value hedge accounting, 

for each of the identified scenarios. This evaluation does not include the net effect on comprehensive income from interest-rate 

sensitive items that are not measured at fair value (e.g., amortization of mortgage loan premiums and discounts, changes in fair 

value of held-for-sale mortgage loans for which we have not elected the fair value option), from changes in our future 

contractual net interest income due to repricing of our interest-bearing assets and liabilities, or from future new business 

activities. The before-tax results of this evaluation are shown in the table below.

Table 27 - Earnings Sensitivity to Changes in Interest Rates

(In millions) June 30, 2023 June 30, 2022

Interest Rate Scenarios(1)

Parallel yield curve shifts: 

 +100 basis points ($44) $76 

 -100 basis points 44 (76) 

Non-parallel yield curve shifts - long-term interest rates:

 +100 basis points 130 114 

 -100 basis points (130) (114) 

Non-parallel yield curve shifts - short-term and medium-term interest rates:

 +100 basis points (175) (38) 

 -100 basis points 175 38 

(1) The earnings sensitivity presented is calculated using the change in interest rates and net effective duration exposure.

The actual effect of changes in interest rates on our comprehensive income in any given period may vary based on a number of 

factors, including, but not limited to, the composition of our assets and liabilities, the actual changes in interest rates that are 

realized at different terms along the yield curve, and the effectiveness of our hedge accounting strategies. Even if implemented 

properly, our hedge accounting programs may not be effective in reducing earnings volatility, and our hedges may fail in any 

given future period, which could expose us to significant earnings variability in that period.

Management's Discussion and Analysis Risk Management

Freddie Mac 2Q 2023 Form 10-Q 33
LIQUIDITY AND CAPITAL RESOURCES

Our business activities require that we maintain adequate liquidity to meet our financial obligations as they come due and to 

meet the needs of customers in a timely and cost-efficient manner. We also must maintain adequate capital resources to avoid 

being placed into receivership by FHFA.

Liquidity

Primary Sources of Liquidity 

The following table lists the sources of our liquidity, the balances as of the dates shown, and a brief description of their 

importance to Freddie Mac.

Table 28 - Liquidity Sources

(In millions) June 30, 2023(1) December 31, 2022(1) Description

Other Investments Portfolio - 

Liquidity and Contingency 

Operating Portfolio

 $133,338 $114,339 The liquidity and contingency operating portfolio, included within 

our other investments portfolio, is primarily used for short-term 

liquidity management.

Mortgage Loans and MortgageRelated Securities  25,524 25,853 The liquid portion of our mortgage-related investments portfolio 

can be pledged or sold for liquidity purposes. The amount of 

cash we may be able to successfully raise may be substantially 

less than the balance.

(1) Represents carrying value for the liquidity and contingency operating portfolio, included within our other investments portfolio, and UPB for the liquid portion of the 

mortgage-related investments portfolio.

Other Investments Portfolio

Our other investments portfolio is important to our cash flow, collateral management, asset and liability management, and 

ability to provide liquidity and stability to the mortgage market. 

Our liquidity and contingency operating portfolio primarily includes securities purchased under agreements to resell and nonmortgage-related securities. Our non-mortgage-related securities consist of U.S. Treasury securities and other investments that 

we could sell to provide us with an additional source of liquidity to fund our business operations. We also maintain non-interestbearing deposits at the Federal Reserve Bank of New York and interest-bearing deposits at commercial banks. Our interestbearing deposits at commercial banks totaled $4.6 billion and $5.0 billion as of June 30, 2023 and December 31, 2022, 

respectively. See MD&A - Our Portfolios - Investments Portfolio - Other Investments Portfolio for more information 

about our other investments portfolio.

Mortgage Loans and Mortgage-Related Securities 

We invest principally in mortgage loans and mortgage-related securities, certain categories of which are largely unencumbered 

and liquid. Our primary source of liquidity among these mortgage assets is our holdings of agency securities. See MD&A - Our 

Portfolios - Investments Portfolio - Mortgage-Related Investments Portfolio for more information about our 

mortgage loans and mortgage-related securities.

Management's Discussion and Analysis Liquidity and Capital Resources 

Freddie Mac 2Q 2023 Form 10-Q 34
Primary Sources of Funding 

The following table lists the sources of our funding, the balances as of the dates shown, and a brief description of their 

importance to Freddie Mac.

Table 29 - Funding Sources

(In millions) June 30, 2023(1) December 31, 2022(1) Description

Debt of Freddie Mac $181,808 $166,762 Debt of Freddie Mac is used to fund our business activities.

Debt of Consolidated Trusts 3,007,278 2,979,070 Debt of consolidated trusts is used primarily to fund our SingleFamily guarantee activities. This type of debt is principally repaid by 

the cash flows of the associated mortgage loans. As a result, our 

repayment obligation is limited to amounts paid pursuant to our 

guarantee of principal and interest and to purchase modified or 

seriously delinquent loans from the trusts.

(1) Represents the carrying value of debt balances after consideration of offsetting arrangements.

Debt of Freddie Mac

We issue debt of Freddie Mac to fund our operations. Competition for funding can vary with economic, financial market, and 

regulatory environments. The amount, type, and term of debt issued is based on a variety of factors and is designed to meet 

our ongoing cash needs and to comply with our Liquidity Management Framework.

The table below summarizes the par value and the average rate of debt of Freddie Mac we issued or paid off, including 

regularly scheduled principal payments, payments resulting from calls, and payments for repurchases. We call, exchange, or 

repurchase our outstanding debt from time to time for a variety of reasons, including managing our funding composition and 

supporting the liquidity of our debt securities.

Table 30 - Debt of Freddie Mac Activity

2Q 2023 2Q 2022

(Dollars in millions) Par Value Average Rate(1) Par Value Average Rate(1)

Short-term:

Beginning balance $8,716 4.36 % $3,300 0.25 %

Issuances 28,030 4.65 2,165 1.45 

Repayments — — — — 

Maturities (25,360) 4.31 (2,350) 0.17 

Ending balance 11,386 5.08 3,115 1.14 

Securities sold under agreements to repurchase 9,168 4.99 9,977 1.06 

Offsetting arrangements (9,168) — (9,977) — 

Securities sold under agreements to repurchase, net — — — — 

Total short-term debt 11,386 5.08 3,115 1.14 

Long-term:

Beginning balance 181,384 2.51 164,876 1.21 

Issuances 20,341 5.44 15,262 3.28 

Repayments (4,020) 5.12 (71) 4.36 

Maturities (17,131) 0.83 (14,634) 0.42 

Total long-term debt 180,574 3.21 165,433 1.52 

Total debt of Freddie Mac, net $191,960 3.32 % $168,548 1.52 %

Referenced footnote is included after the year-to-date table.

Management's Discussion and Analysis Liquidity and Capital Resources

Freddie Mac 2Q 2023 Form 10-Q 35
YTD 2023 YTD 2022

(Dollars in millions) Par Value Average Rate(1) Par Value Average Rate(1)

Short-term:

Beginning balance $7,716 3.49 % $— — %

Issuances 78,769 4.35 7,718 0.51 

Repayments — — — — 

Maturities (75,099) 4.13 (4,603) 0.09 

Ending balance 11,386 5.08 3,115 1.14 

Securities sold under agreements to repurchase 9,168 4.99 9,977 1.06 

Offsetting arrangements (9,168) — (9,977) — 

Securities sold under agreements to repurchase, net — — — — 

Total short-term debt 11,386 5.08 3,115 1.14 

Long-term:

Beginning balance 170,363 2.22 181,613 1.11 

Issuances 34,533 5.40 17,072 3.17 

Repayments (6,511) 5.43 (1,905) 3.03 

Maturities (17,811) 0.86 (31,347) 0.26 

Total long-term debt 180,574 3.21 165,433 1.52 

Total debt of Freddie Mac, net $191,960 3.32 % $168,548 1.52 %

(1) Average rate is weighted based on par value.

Total debt issuance increased in 2Q 2023 compared to 2Q 2022 to provide additional liquidity due to the uncertainty created by 

the debate about increasing the federal debt ceiling. Total debt issuance during YTD 2023 increased compared to YTD 2022 

due to the uncertainty related to the federal debt ceiling as well as to fund upcoming debt maturities and anticipated calls of 

outstanding debt during 1Q 2023. As of June 30, 2023, our aggregate indebtedness pursuant to the Purchase Agreement was 

$192.0 billion, which was below the current $270.0 billion debt cap limit. Our aggregate indebtedness calculation primarily 

includes the par value of short- and long-term debt.

Maturity and Redemption Dates

The following table presents the par value of debt of Freddie Mac by contractual maturity date and earliest redemption date. 

The earliest redemption date refers to the earliest call date for callable debt and the contractual maturity date for all other debt 

of Freddie Mac.

Table 31 - Maturity and Redemption Dates

As of June 30, 2023 As of December 31, 2022

(In millions) Contractual Maturity Date Earliest Redemption Date Contractual Maturity Date Earliest Redemption Date

Debt of Freddie Mac(1):

1 year or less $68,239 $170,255 $60,534 $156,515 

1 year through 2 years 40,124 6,100 32,261 3,820 

2 years through 3 years 47,119 9,893 51,658 13,071 

3 years through 4 years 7,630 106 5,739 212 

4 years through 5 years 8,783 364 7,603 170 

Thereafter 26,293 11,470 27,623 11,630 

STACR and SCR debt(2) 2,940 2,940 4,652 4,652 

Total debt of Freddie Mac $201,128 $201,128 $190,070 $190,070 

(1) Includes payables related to securities sold under agreements to repurchase that we offset against receivables related to securities purchased under agreements to 

resell on our condensed consolidated balance sheets, when such amounts meet the conditions for offsetting in the accounting guidance.

(2) STACR debt notes and SCR debt notes are subject to prepayment risk as their payments are based upon the performance of a reference pool of mortgage assets that 

may be prepaid by the related mortgage borrower at any time generally without penalty and are, therefore, included as a separate category in the table.

Management's Discussion and Analysis Liquidity and Capital Resources

Freddie Mac 2Q 2023 Form 10-Q 36
Debt of Consolidated Trusts

The largest component of debt on our condensed consolidated balance sheets is debt of consolidated trusts, which relates to 

securitization transactions that we consolidate for accounting purposes. We primarily issue this type of debt by securitizing 

mortgage loans to fund our Single-Family guarantee activities. 

The table below shows activity for the debt of consolidated trusts.

Table 32 - Debt of Consolidated Trusts Activity

(In millions) 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Beginning balance $2,938,721 $2,835,071 $2,929,567 $2,732,056 

Issuances 114,546 203,919 201,567 499,166 

Repayments and extinguishments (92,271) (161,268) (170,138) (353,500) 

Ending balance 2,960,996 2,877,722 2,960,996 2,877,722 

Unamortized premiums and discounts 46,282 56,393 46,282 56,393 

Debt of consolidated trusts $3,007,278 $2,934,115 $3,007,278 $2,934,115 

Credit Ratings

On May 25, 2023, Fitch changed our credit rating Outlook from Stable to Negative Watch due to the uncertainty created by the 

debate about increasing the federal debt ceiling. For additional information on our credit ratings, see MD&A - Liquidity and 

Capital Resources in our 2022 Annual Report.

Off-Balance Sheet Arrangements

We enter into certain business arrangements that are not recorded on our condensed consolidated balance sheets or that may 

be recorded in amounts that differ from the full contractual or notional amount of the transaction that affect our short- and longterm liquidity needs. Our off-balance sheet arrangements primarily consist of guarantees and commitments. See Note 2 and

Note 4 for additional information on these transactions. See MD&A - Risk Management - Credit Risk for additional 

information on our credit risk exposure on off-balance sheet arrangements.

Cash Flows

Cash and cash equivalents (including restricted cash and cash equivalents) increased slightly from $5.3 billion as of June 30, 

2022 to $5.5 billion as of June 30, 2023.

Management's Discussion and Analysis Liquidity and Capital Resources 

Freddie Mac 2Q 2023 Form 10-Q 37
Capital Resources

The table below presents activity related to our net worth. 

Table 33 - Net Worth Activity

(In millions) 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Beginning balance $39,067 $31,711 $37,018 $28,033 

Comprehensive income 2,890 2,387 4,939 6,065 

Capital draw from Treasury — — — — 

Senior preferred stock dividends declared — — — — 

Total equity / net worth $41,957 $34,098 $41,957 $34,098 

Remaining Treasury funding commitment $140,162 $140,162 $140,162 $140,162 

Aggregate draws under Purchase Agreement 71,648 71,648 71,648 71,648 

Aggregate cash dividends paid to Treasury 119,680 119,680 119,680 119,680 

Liquidation preference of the senior preferred stock 111,715 104,359 111,715 104,359 

ERCF

The charts below present the ERCF capital adequacy requirements under the risk-based capital requirement (CET1 capital ratio 

relative to RWA) and leverage capital requirement (Tier 1 capital ratio relative to ATA). 

Risk-Based Capital Requirement: CET1 Capital Ratio 

10.1% 9.9%

4.5% 4.5%

3.0% 2.9%

2.6% 2.5%

Minimum requirement

Stress capital buffer

Stability capital buffer

12/31/22 06/30/23

Leverage Capital Requirement: Tier 1 Capital Ratio

2.8% 2.8%

2.5% 2.5%

0.3% 0.3%

Minimum requirement

PLBA

12/31/22 06/30/23

Management's Discussion and Analysis Liquidity and Capital Resources

Freddie Mac 2Q 2023 Form 10-Q 38
Capital Metrics

The table below presents the components of our regulatory capital.

Table 34 - Regulatory Capital Components 

(In billions) June 30, 2023 December 31, 2022

Total equity $42 $37 

Less:

Senior preferred stock 73 73 

Preferred stock 14 14 

Common equity (45) (50) 

Less: deferred tax assets arising from temporary differences that exceed 10% of 

CET1 capital and other regulatory adjustments 5 5 

Common equity Tier 1 capital (50) (55) 

Add: Preferred stock 14 14 

Tier 1 capital (36) (41) 

Tier 2 capital adjustments — — 

Adjusted total capital ($36) ($41) 

The table below presents the components of our statutory capital.

Table 35 - Statutory Capital Components 

(In billions) June 30, 2023 December 31, 2022

Total equity $42 $37 

Less:

Senior preferred stock 73 73 

AOCI, net of taxes — (1) 

Core capital (31) (35) 

General allowance for foreclosure losses(1) 8 8 

Total capital ($23) ($27) 

(1) Represents our allowance for credit losses.

Management's Discussion and Analysis Liquidity and Capital Resources

Freddie Mac 2Q 2023 Form 10-Q 39
Table 36 - Capital Metrics Under ERCF 

(In billions) June 30, 2023 December 31, 2022

Adjusted total assets $3,744 $3,710 

Risk-weighted assets (standardized approach):

 Credit risk 802 778 

 Market risk 57 51 

 Operational risk 70 70 

Total risk-weighted assets $929 $899 

(In billions) June 30, 2023 December 31, 2022

Stress capital buffer $28 $27 

Stability capital buffer 23 23 

Countercyclical capital buffer amount — — 

PCCBA $51 $50 

PLBA $11 $11 

June 30, 2023

(Dollars in billions)

Minimum 

Capital 

Requirement

Applicable 

Buffer(1)

Capital 

Requirement 

(Including Buffer)

Available 

Capital (Deficit)

Capital 

Shortfall

Risk-based capital amounts:

Total capital $74 N/A $74 ($23) ($97) 

CET1 capital 42 $51 93 (50) (143) 

Tier 1 capital 56 51 107 (36) (143) 

Adjusted total capital 74 51 125 (36) (161) 

Risk-based capital ratios(2):

Total capital 8.0 % N/A 8.0 % (2.4) % (10.4) %

CET1 capital 4.5 5.4 % 9.9 (5.4) (15.3) 

Tier 1 capital 6.0 5.4 11.4 (3.9) (15.3) 

Adjusted total capital 8.0 5.4 13.4 (3.9) (17.3) 

Leverage capital amounts:

Core capital $94 N/A $94 ($31) ($125) 

Tier 1 capital 94 $11 105 (36) (141) 

Leverage capital ratios(3):

Core capital 2.5 % N/A 2.5 % (0.8) % (3.3) %

Tier 1 capital 2.5 0.3 % 2.8 (1.0) (3.8) 

 Referenced footnotes are included after the prior period table.

Management's Discussion and Analysis Liquidity and Capital Resources

Freddie Mac 2Q 2023 Form 10-Q 40
December 31, 2022

(Dollars in billions)

Minimum 

Capital 

Requirement

Applicable 

Buffer(1)

Capital 

Requirement 

(Including Buffer)

Available 

Capital (Deficit)

Capital 

Shortfall

Risk-based capital amounts:

Total capital $72 N/A $72 ($27) ($99) 

CET1 capital 40 $50 90 (55) (145) 

Tier 1 capital 54 50 104 (41) (145) 

Adjusted total capital 72 50 122 (41) (163) 

Risk-based capital ratios(2):

Total capital 8.0 % N/A 8.0 % (3.1) % (11.1) %

CET1 capital 4.5 5.6 % 10.1 (6.2) (16.3) 

Tier 1 capital 6.0 5.6 11.6 (4.6) (16.2) 

Adjusted total capital 8.0 5.6 13.6 (4.6) (18.2) 

Leverage capital amounts:

Core capital $93 N/A $93 ($35) ($128) 

Tier 1 capital 93 $11 104 (41) (145) 

Leverage capital ratios(3):

Core capital 2.5 % N/A 2.5 % (1.0) % (3.5) %

Tier 1 capital 2.5 0.3 % 2.8 (1.1) (3.9) 

(1) PCCBA for risk-based capital and PLBA for leverage capital.

(2) As a percentage of RWA.

(3) As a percentage of ATA.

At June 30, 2023, our maximum payout ratio under the ERCF was 0.0%.

See Note 15 for additional information on our capital amounts and ratios under the ERCF. 

Management's Discussion and Analysis Liquidity and Capital Resources

Freddie Mac 2Q 2023 Form 10-Q 41
CRITICAL ACCOUNTING ESTIMATES

Our critical accounting estimates and policies relate to the Single-Family allowance for credit losses. For additional information 

about our critical accounting estimates and other significant accounting policies, see Note 1 and Critical Accounting Estimates 

in our 2022 Annual Report. 

Single-Family Allowance for Credit Losses

The Single-Family allowance for credit losses represents our estimate of expected credit losses over the contractual term of the 

mortgage loans. The Single-Family allowance for credit losses pertains to all single-family loans classified as held-forinvestment on our condensed consolidated balance sheets.

Determining the appropriateness of the Single-Family allowance for credit losses is a complex process that is subject to 

numerous estimates and assumptions requiring significant management judgment about matters that involve a high degree of 

subjectivity. This process involves the use of models that require us to make judgments about matters that are difficult to 

predict. 

Changes in forecasted house price growth rates can have a significant effect on our allowance for credit losses estimates. The 

table below shows our nationwide forecasted house price growth rates that were used in determining our allowance for credit 

losses. See Note 5 for additional information regarding our current period provision for credit losses.

Table 37 - Forecasted House Price Growth Rates 

12-Month Forward

13- to 24-Month 

Forward

June 30, 2023 0.8 % 0.9 %

March 31, 2023 (2.9) (1.3) 

December 31, 2022 (3.0) (1.8) 

Management's Discussion and Analysis Critical Accounting Estimates

Freddie Mac 2Q 2023 Form 10-Q 42
REGULATION AND SUPERVISION

In addition to oversight by FHFA as our Conservator, we are subject to regulation and oversight by FHFA under our Charter and 

the GSE Act and to certain regulation by other government agencies. FHFA has the power to require us from time to time to 

change our processes, take action and/or stop taking action that could impact our business. Furthermore, regulatory activities 

by other government agencies can affect us indirectly, even if we are not directly subject to such agencies' regulation or 

oversight. For example, regulations that modify requirements applicable to the purchase or servicing of mortgages can affect 

us.

Federal Housing Finance Agency

Targeted Changes to Enterprise Pricing Framework

In January 2023, FHFA announced further changes to Freddie Mac’s single-family pricing framework by introducing, among 

other things, a new upfront fee for certain borrowers with a DTI ratio above 40 percent. In March 2023, FHFA announced that it 

would delay the effective date of the DTI ratio-based fee by three months from May 1, 2023, to August 1, 2023. On May 10, 

2023, FHFA announced the rescission of the DTI ratio-based upfront fee for loans acquired by Freddie Mac. 

On May 15, 2023, FHFA issued a Request for Input (RFI) on Freddie Mac’s single-family pricing framework. The RFI solicits 

public feedback on the goals and policy priorities that FHFA should pursue in its oversight of the pricing framework. FHFA also 

seeks input on the process for setting the Enterprises’ single-family upfront guarantee fees, including whether it is appropriate 

to continue to link upfront guarantee fees to the ERCF, which has a significant impact on the risk-based pricing component of 

the Enterprises’ guarantee fees.

Request for Input on Multifamily Tenant Protections

On May 30, 2023, FHFA issued an RFI on tenant protections at multifamily properties with mortgages backed by Freddie Mac. 

This RFI will assist FHFA in exploring possible ways that we could advance our mission. Specifically, the RFI seeks: (1) to 

collect information that highlights tenants’ experiences and stakeholders’ perspectives to explore challenges faced at 

multifamily properties; and (2) to solicit ideas for improved data collection to better quantify the size and scope of the issues 

experienced by tenants.

Quality Control Standards for Automated Valuation Models

On June 21, 2023, six federal regulatory agencies, including FHFA, requested public comment on a proposed rule designed to 

ensure the credibility and integrity of models used in real estate valuations. In particular, the proposed rule would implement 

quality control standards for automated valuation models (AVMs) used by mortgage originators and secondary market issuers 

in valuing real estate collateral securing mortgage loans. The proposed standards are designed to ensure a high level of 

confidence in the estimates produced by AVMs; help protect against the manipulation of data; seek to avoid conflicts of 

interest; require random sample testing and reviews; and promote compliance with applicable nondiscrimination laws.

Legislative and Regulatory Developments

Middle Class Borrower Protection Act of 2023

On June 23, 2023, the House of Representatives passed the Middle Class Borrower Protection Act of 2023. The bill would 

require FHFA to reverse the changes in fees charged by Freddie Mac and Fannie Mae on certain single-family mortgages and 

would restrict future fee adjustments. If the bill becomes law, the fee structure that was in place prior to May 1, 2023 would be 

reinstated and would stay in place until the U.S. Government Accountability Office completes an assessment of the current fee 

structure and releases its report, 90 days after which FHFA may propose adjustments to the fee structure. FHFA would be 

required to follow the Administrative Procedure Act requirements as closely as practical when proposing adjustment to the fee 

structure. Any loan-level pricing adjustment fees based on a mortgagor’s debt to income ratio would be prohibited. The bill has 

been received in the Senate and referred to the Senate Banking, Housing, and Urban Affairs Committee.

Management's Discussion and Analysis Regulation and Supervision

Freddie Mac 2Q 2023 Form 10-Q 43
FORWARD-LOOKING STATEMENTS

We regularly communicate information concerning our business activities to investors, the news media, securities analysts, and 

others as part of our normal operations. Some of these communications, including this Form 10-Q, contain "forward-looking 

statements." Examples of forward-looking statements include, but are not limited to, statements pertaining to the 

conservatorship, our current expectations and objectives for the Single-Family and Multifamily segments of our business, our 

efforts to assist the housing market, our liquidity and capital management, economic and market conditions and trends 

including, but not limited to, changes in observed and forecasted house price appreciation, our market share, the effect of 

legislative and regulatory developments and new accounting guidance, the credit quality of loans we own or guarantee, the 

costs and benefits of our CRT transactions, banking crises or failures, the effects of natural disasters, other catastrophic 

events, and significant climate change effects and actions taken in response thereto on our business, and our results of 

operations and financial condition. Forward-looking statements involve known and unknown risks and uncertainties, some of 

which are beyond our control. Forward-looking statements are often accompanied by, and identified with, terms such as 

"could," "may," "will," "believe," "expect," "anticipate," "forecast," and similar phrases. These statements are not historical 

facts, but rather represent our expectations based on current information, plans, judgments, assumptions, estimates, and 

projections. Actual results may differ significantly from those described in or implied by such forward-looking statements due to 

various factors and uncertainties, including those described in the Risk Factors section in our 2022 Annual Report, and 

including, without limitation, the following:

n The actions the federal government (including FHFA, Treasury, and Congress) and state governments may take, require us 

to take, or restrict us from taking, including actions to promote equitable access to affordable and sustainable housing, 

such as programs to implement the expectations in FHFA's Conservatorship Scorecards, recent requirements and 

guidance related to equitable housing, and other objectives for us;

n Changes in the fiscal and monetary policies of the Federal Reserve, including changes in target interest rates and in the 

amount of agency MBS and agency CMBS held by the Federal Reserve;

n The effect of the restrictions on our business due to the conservatorship and the Purchase Agreement;

n Changes in our Charter, applicable legislative or regulatory requirements (including any legislation affecting the future 

status of our company), or the Purchase Agreement;

n Changes to our capital requirements and potential effects of such changes on our business strategies;

n Changes in tax laws;

n Changes in privacy and cybersecurity laws and regulations;

n Changes in accounting policies, practices, standards, or guidance;

n Changes in economic and market conditions, including volatility in the financial services industry, changes in employment 

rates, inflation, interest rates, spreads, and house prices;

n Changes in the U.S. residential mortgage market, including changes in the supply and type of loan products (e.g., 

refinance vs. purchase and fixed-rate vs. ARM);

n The success of our efforts to mitigate our losses on our Single-Family mortgage portfolio;

n The success of our strategy to transfer mortgage credit risk through STACR, ACIS, K Certificate, SCR, MCIP, and other 

CRT transactions;

n Our ability to maintain adequate liquidity to fund our operations;

n Our ability to maintain the security and resiliency of our operational systems and infrastructure, including against 

cyberattacks or other security incidents, whether due to insider error or malfeasance or system errors or vulnerabilities in 

our or our third parties' systems;

n Our ability to effectively execute our business strategies, implement significant changes, and improve efficiency;

n The adequacy of our risk management framework, including the adequacy of our regulatory capital framework prescribed 

by FHFA and internal models for measuring risk;

n Our ability to manage mortgage credit risk, including the effect of changes in underwriting and servicing practices;

n Our ability to limit or manage our economic exposure and GAAP earnings exposure to interest-rate volatility and spread 

volatility, including the availability of derivative financial instruments needed for interest-rate risk management purposes 

and our ability to apply hedge accounting;

n Our operational ability to issue new securities, make timely and correct payments on securities, and provide initial and 

ongoing disclosures;

n Our reliance on CSS and the CSP for the operation of the majority of our Single-Family securitization activities, limits on 

our influence over CSS Board decisions, and any additional changes FHFA may require in our relationship with, or support 

of, CSS;

n	 Changes in the methodologies, models, assumptions, and estimates we use to prepare our financial statements, make 

business decisions, and manage risks;

Management's Discussion and Analysis Forward-Looking Statements

Freddie Mac 2Q 2023 Form 10-Q 44
n Changes in investor demand for our debt or mortgage-related securities;

n Our ability to maintain market acceptance of the UMBS, including our ability to maintain alignment of the prepayment 

speeds of our and Fannie Mae's respective UMBS;

n Changes in the practices of loan originators, servicers, investors, and other participants in the secondary mortgage market; 

n Competition from other market participants, which could affect the pricing we offer for our products, the credit 

characteristics of the loans we purchase, and our ability to meet our affordable housing goals and other mandated 

activities; 

n The adverse consequences on our business and operations that may occur from the discontinuance of LIBOR and the 

transition to SOFR as the replacement;

n The availability of critical third parties, or their vendors and other business partners, to deliver products or services, or to 

manage risks, including cybersecurity risk, effectively;

n The occurrence of a major natural disaster, other catastrophic event, or significant climate change effects in areas in which 

our offices, significant portions of our total mortgage portfolio, or the offices of critical third parties are located, and for 

which we may be uninsured or significantly underinsured; and 

n	 Other factors and assumptions described in this Form 10-Q and our 2022 Annual Report, including in the MD&A section.

Forward-looking statements are made only as of the date of this Form 10-Q, and we undertake no obligation to update any 

forward-looking statements we make to reflect events or circumstances occurring after the date of this Form 10-Q.

Management's Discussion and Analysis Forward-Looking Statements

Freddie Mac 2Q 2023 Form 10-Q 45
Financial Statements

Financial Statements

Freddie Mac 2Q 2023 Form 10-Q 46
FREDDIE MAC 

Condensed Consolidated Statements of Income and 

Comprehensive Income (Unaudited) 

(In millions, except share-related amounts) 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Net interest income

Interest income $25,755 $20,008 $50,742 $37,748 

Interest expense (21,232) (15,249) (41,718) (28,885) 

Net interest income 4,523 4,759 9,024 8,863 

Non-interest income

Guarantee income 309 205 775 275 

Investment gains, net 411 321 186 1,834 

Other income 96 119 181 278 

Non-interest income 816 645 1,142 2,387 

Net revenues 5,339 5,404 10,166 11,250 

(Provision) benefit for credit losses 537 (307) 142 530 

Non-interest expense

Salaries and employee benefits (405) (376) (779) (732) 

Credit enhancement expense (590) (558) (1,120) (1,017) 

Benefit for (decrease in) credit enhancement recoveries (108) (1) (59) (18) 

Legislative assessments expense (751) (748) (1,486) (1,507) 

Other expense (350) (337) (692) (678) 

Non-interest expense (2,204) (2,020) (4,136) (3,952) 

Income before income tax expense 3,672 3,077 6,172 7,828 

Income tax expense (728) (624) (1,233) (1,577) 

Net income 2,944 2,453 4,939 6,251 

Other comprehensive income (loss), net of taxes and reclassification 

adjustments (54) (66) — (186) 

Comprehensive income $2,890 $2,387 $4,939 $6,065 

Net income $2,944 $2,453 $4,939 $6,251 

Amounts attributable to senior preferred stock (2,890) (2,387) (4,939) (6,065) 

Net income attributable to common stockholders $54 $66 $— $186 

Net income per common share $0.02 $0.02 $— $0.06 

Weighted average common shares (in millions) 3,234 3,234 3,234 3,234 

The accompanying notes are an integral part of these condensed consolidated financial statements.

Financial Statements Condensed Consolidated Statements of Income and Comprehensive Income

Freddie Mac 2Q 2023 Form 10-Q 47
FREDDIE MAC

Condensed Consolidated Balance Sheets (Unaudited) 

June 30, December 31,

(In millions, except share-related amounts) 2023 2022

Assets

Cash and cash equivalents (includes $793 and $707 of restricted cash and cash equivalents) $5,514 $6,360 

Securities purchased under agreements to resell 112,386 87,295 

Investment securities, at fair value 41,629 38,701 

Mortgage loans held-for-sale (includes $5,712 and $3,218 at fair value) 11,695 12,197 

Mortgage loans held-for-investment (net of allowance for credit losses of $7,339 and $7,391 and includes 

$1,359 and $1,214 at fair value) 

 3,042,604 3,022,318 

Accrued interest receivable, net 9,081 8,529 

Deferred tax assets, net 5,237 5,777 

Other assets (includes $5,840 and $5,890 at fair value) 22,810 27,156 

Total assets $3,250,956 $3,208,333 

Liabilities and equity

Liabilities

Accrued interest payable $8,049 $7,309 

Debt (includes $1,995 and $3,047 at fair value) 3,189,086 3,145,832 

Other liabilities (includes $1,017 and $759 at fair value) 11,864 18,174 

Total liabilities 3,208,999 3,171,315 

Commitments and contingencies (Notes 4, 8, 14)

Equity

Senior preferred stock (liquidation preference of $111,715 and $107,878) 72,648 72,648 

Preferred stock, at redemption value 14,109 14,109 

Common stock, $0.00 par value, 4,000,000,000 shares authorized, 725,863,886 shares issued and 

650,059,553 shares outstanding

 — — 

Retained earnings (40,727) (45,666) 

AOCI, net of taxes, related to:

Available-for-sale securities (88) (84) 

Other (100) (104) 

AOCI, net of taxes (188) (188) 

Treasury stock, at cost, 75,804,333 shares (3,885) (3,885) 

Total equity 41,957 37,018 

Total liabilities and equity $3,250,956 $3,208,333 

The table below presents the carrying value and classification of the assets and liabilities of consolidated VIEs on our condensed consolidated balance 

sheets.

 

June 30, December 31, 

(In millions) 2023 2022

Assets:

Cash and cash equivalents (includes $700 and $610 of restricted cash and cash equivalents) $701 $611 

Securities purchased under agreements to resell 11,265 9,703 

Investment securities, at fair value 94 126 

Mortgage loans held-for-investment, net 2,995,770 2,971,601 

Accrued interest receivable, net 8,288 7,944 

Other assets 6,653 5,019 

Total assets of consolidated VIEs $3,022,771 $2,995,004

Liabilities:

Accrued interest payable $7,014 $6,619 

Debt 3,007,278 2,979,070 

Total liabilities of consolidated VIEs $3,014,292 $2,985,689 

The accompanying notes are an integral part of these condensed consolidated financial statements.

Financial Statements Condensed Consolidated Balance Sheets

Freddie Mac 2Q 2023 Form 10-Q 48
FREDDIE MAC

Condensed Consolidated Statements of Equity (Unaudited) 

Shares Outstanding

Senior

Preferred

Stock

Preferred

Stock, at

Redemption

Value

Common

Stock, at

Par Value

Retained

Earnings

AOCI,

Net of

Tax

Treasury

Stock, at

Cost

Total

(In millions) Equity 

Senior

Preferred

Stock

Preferred

Stock

Common

Stock

Balance at March 31, 2023 1 464 650 $72,648 $14,109 $— ($43,671) ($134) ($3,885) $39,067 

Comprehensive income:

Net income — — — — — — 2,944 — — 2,944 

Other comprehensive income (loss):

Changes in net unrealized gains (losses) 

on available-for-sale securities (net of 

taxes of $15 million) — — — — — — — (55) — (55) 

Reclassification adjustment for gains on 

available-for-sale securities included in 

net income (net of taxes of $0 million) — — — — — — — (1) — (1) 

Other (net of taxes of $0 million) — — — — — — — 2 — 2 

Comprehensive income — — — — — — 2,944 (54) — 2,890 

Ending balance at June 30, 2023 1 464 650 $72,648 $14,109 $— ($40,727) ($188) ($3,885) $41,957 

Balance at March 31, 2022 1 464 650 $72,648 $14,109 $— ($51,195) $34 ($3,885) $31,711 

Comprehensive income:

Net income — — — — — — 2,453 — — 2,453 

Other comprehensive income (loss):

Changes in net unrealized gains (losses) 

on available-for-sale securities (net of 

taxes of $19 million) — — — — — — — (71) — (71) 

Reclassification adjustment for gains on 

available-for-sale securities included in 

net income (net of taxes of $1 million) — — — — — — — 3 — 3 

Other (net of taxes of $1 million) — — — — — — — 2 — 2 

Comprehensive income — — — — — — 2,453 (66) — 2,387 

Ending balance at June 30, 2022 1 464 650 $72,648 $14,109 $— ($48,742) ($32) ($3,885) $34,098 

Shares Outstanding

Senior

Preferred

Stock

Preferred

Stock, at

Redemption

Value

Common

Stock, at

Par Value

Retained

Earnings

AOCI,

Net of

Tax

Treasury

Stock, at

Cost

Total

(In millions) Equity 

Senior

Preferred

Stock

Preferred

Stock

Common

Stock

Balance at December 31, 2022 1 464 650 $72,648 $14,109 $— ($45,666) ($188) ($3,885) $37,018 

Comprehensive income:

Net income — — — — — — 4,939 — — 4,939 

Other comprehensive income (loss):

Changes in net unrealized gains (losses) 

on available-for-sale securities (net of 

taxes of $1 million) — — — — — — — (3) — (3) 

Reclassification adjustment for gains on 

available-for-sale securities included in 

net income (net of taxes of $0 million) — — — — — — — (1) — (1) 

Other (net of taxes of $1 million) — — — — — — — 4 — 4 

Comprehensive income — — — — — — 4,939 — — 4,939 

Ending balance at June 30, 2023 1 464 650 $72,648 $14,109 $— ($40,727) ($188) ($3,885) $41,957 

Balance at December 31, 2021 1 464 650 $72,648 $14,109 $— ($54,993) $154 ($3,885) $28,033 

Comprehensive income:

Net income — — — — — — 6,251 — — 6,251 

Other comprehensive income (loss):

Changes in net unrealized gains (losses) 

on available-for-sale securities (net of 

taxes of $52 million) — — — — — — — (194) — (194) 

Reclassification adjustment for gains on 

available-for-sale securities included in 

net income (net of taxes of $1 million) — — — — — — — 4 — 4 

Other (net of taxes of $1 million) — — — — — — — 4 — 4 

Comprehensive income — — — — — — 6,251 (186) — 6,065 

Ending balance at June 30, 2022 1 464 650 $72,648 $14,109 $— ($48,742) ($32) ($3,885) $34,098 

The accompanying notes are an integral part of these condensed consolidated financial statements.

Financial Statements Condensed Consolidated Statements of Equity

Freddie Mac 2Q 2023 Form 10-Q 49
FREDDIE MAC

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In millions) YTD 2023 YTD 2022

Net cash provided by (used in) operating activities $5,006 $7,783 

Cash flows from investing activities

Investment securities:

Purchases (69,402) (80,629) 

Proceeds from sales 56,879 74,416 

Proceeds from maturities and repayments 9,373 7,993 

Mortgage loans acquired held-for-investment:

Purchases (48,969) (96,257) 

Proceeds from sales 4,634 2,159 

Proceeds from repayments 121,259 211,698 

Secured lending arrangements:

Advances (47,709) (104,516) 

Proceeds from repayments 12 363 

Net (increase) decrease in securities purchased under agreements to resell (22,267) (17,889) 

Cash flows related to derivatives 1,654 3,424 

Other, net (221) (237) 

Net cash provided by (used in) investing activities 5,243 525 

Cash flows from financing activities

Debt of consolidated trusts:

Proceeds from issuance 99,146 231,938 

Repayments and redemptions (121,120) (234,680) 

Debt of Freddie Mac:

Proceeds from issuance 113,098 24,803 

Repayments (99,255) (37,903) 

Net increase (decrease) in securities sold under agreements to repurchase (2,824) 2,644 

Other, net (140) (3) 

Net cash provided by (used in) financing activities (11,095) (13,201) 

Net increase (decrease) in cash and cash equivalents (includes restricted cash and cash equivalents) (846) (4,893) 

Cash and cash equivalents (includes restricted cash and cash equivalents) at the beginning of year 6,360 10,150 

Cash and cash equivalents (includes restricted cash and cash equivalents) at end of period $5,514 $5,257 

Supplemental cash flow information

Cash paid for:

Debt interest 42,058 $36,287 

Income taxes 700 1,500 

Non-cash investing and financing activities (Notes 3 and 6)

 The accompanying notes are an integral part of these condensed consolidated financial statements. 

Financial Statements Condensed Consolidated Statements of Cash Flows

Freddie Mac 2Q 2023 Form 10-Q 50
Notes to Condensed Consolidated Financial 

Statements

NOTE 1

Summary of Significant Accounting Policies

Freddie Mac is a GSE chartered by Congress in 1970, with a mission to provide liquidity, stability, and affordability to the U.S. 

housing market. We are regulated by FHFA, the SEC, HUD, and Treasury, and are currently operating under the 

conservatorship of FHFA. The conservatorship and related matters significantly affect our management, business activities, 

financial condition, and results of operations. In connection with our entry into conservatorship, we entered into the Purchase 

Agreement with Treasury, under which we issued Treasury both senior preferred stock and a warrant to purchase common 

stock. Our Purchase Agreement with Treasury is critical to keeping us solvent and avoiding the appointment of a receiver by 

FHFA under statutory mandatory receivership provisions. We believe the support provided by Treasury pursuant to the 

Purchase Agreement currently enables us to have adequate liquidity to conduct normal business activities. For more 

information on the conservatorship, the roles of FHFA and Treasury, and the Purchase Agreement, see our 2022 Annual Report. 

Throughout our unaudited condensed consolidated financial statements and related notes, we use certain acronyms and terms 

which are defined in the Glossary of our 2022 Annual Report. 

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited 

consolidated financial statements and related notes in our 2022 Annual Report.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and 

include our accounts as well as the accounts of other entities in which we have a controlling financial interest. All intercompany 

balances and transactions have been eliminated.

We are operating under the basis that we will realize assets and satisfy liabilities in the normal course of business as a going 

concern and in accordance with the authority provided by FHFA to our Board of Directors to oversee management's conduct of 

our business operations. In the opinion of management, our unaudited condensed consolidated financial statements contain all 

adjustments, which include only normal recurring adjustments, necessary for a fair statement of our results. 

Use of Estimates

The preparation of our condensed consolidated financial statements requires management to make estimates and assumptions 

that affect the reported amounts of assets and liabilities, revenues and expenses, and disclosure of contingent assets and 

liabilities at the date of the financial statements. Management has made significant estimates to report the allowance for credit 

losses on single-family mortgage loans. Actual results could be different from these estimates.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 1

Freddie Mac 2Q 2023 Form 10-Q 51
Recently Issued Accounting Guidance

Recently Adopted Accounting Guidance

Standard Description Date of 

 Adoption

Effect on Consolidated Financial 

Statements

ASU 2022-01, Derivatives and 

Hedging (Topic 815): Fair Value 

Hedging - Portfolio Layer Method

The amendments in this Update provide 

clarifications of the guidance in ASC Topic 815 

on fair value hedge accounting of interest rate 

risk for portfolios of financial assets. The 

Update amends the guidance in ASU 2017-12 

that, among other things, establishes the "lastof-layer" method for making the fair value 

hedge accounting for these portfolios more 

accessible by allowing the entities to apply the 

portfolio layer method to portfolios of all 

financial assets, including both prepayable and 

nonprepayable financial assets. The Update 

provides additional guidance on the accounting 

for and disclosure of hedge basis adjustments 

that are applicable to the portfolio layer 

method. 

January 1, 2023 The adoption of these amendments 

did not have a material effect on our 

consolidated financial statements. 

We adopted the guidance in this 

Update related to disclosures on a 

prospective basis.

ASU 2022-02, Financial 

Instruments—Credit Losses 

(Topic 326): Troubled Debt 

Restructurings and Vintage 

Disclosures

The amendments in this Update require 

disclosure of current period gross write-offs by 

year of origination for financing receivables 

within the scope of ASC Subtopic 326-20.

January 1, 2023 for the 

amendments related to 

disclosure of gross writeoffs by year of origination.

The adoption of these amendments 

did not have a material effect on our 

consolidated financial statements. 

See Note 3 for additional disclosure 

of gross write-offs by year of 

origination. 

Recently Issued Accounting Guidance, Not Yet Adopted Within Our Consolidated Financial Statements

Standard Description Date of 

 Adoption

Effect on Consolidated Financial 

Statements

ASU 2023-02, Investments - 

Equity Method and Joint 

Ventures (Topic 323): Accounting 

for Investments in Tax Credit 

Structures Using the Proportional 

Amortization Method 

The amendments in this Update expand the 

use of the proportional amortization method of 

accounting to equity investments in other tax 

credit structures that meet certain conditions. 

This Update also amends those conditions 

primarily to assess projected benefits on a 

discounted basis and expands the disclosure 

requirements of those investments. 

January 1, 2024 We do not expect the adoption of 

these amendments to have a 

material effect on our consolidated 

financial statements.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 1

Freddie Mac 2Q 2023 Form 10-Q 52
NOTE 2

Securitizations and Variable Interest Entities

Nonconsolidated VIEs

The following table presents the carrying amounts and classification of the assets and liabilities recorded on our condensed 

consolidated balance sheets that relate to our variable interests in VIEs for which we are not the primary beneficiary and with 

which we were involved in the design and creation and have a significant continuing involvement, our maximum exposure to 

loss as a result of our involvement with such VIEs, and the total assets of the VIEs. Our involvement with such VIEs primarily 

consists of guarantees that we have issued to the VIE, some of which are accounted for as derivative instruments, and 

investments in debt securities issued by the VIE. See Note 4 for additional information on our guarantees to nonconsolidated 

VIEs. 

Total assets shown in the table below represents the remaining UPB of the mortgage loans or other noncash financial assets 

held by the VIE and excludes cash and nonfinancial assets held by the VIE. Maximum exposure to loss shown in the table 

below is primarily based on the remaining UPB of the guaranteed securities issued by the VIE and represents the contractual 

amounts that could be lost if the assets of the VIE (including the assets in the related reference pool for CRT products) became 

worthless at the balance sheet date, without consideration of proceeds from related collateral liquidation and possible 

recoveries under credit enhancements. We do not believe the maximum exposure to loss from our involvement with 

nonconsolidated VIEs is representative of the actual loss we are likely to incur based on our historical loss experience and after 

consideration of proceeds from related collateral liquidation and available credit enhancements.

Table 2.1 - Nonconsolidated VIEs

June 30, 2023

Carrying Amounts of the Assets and Liabilities On the 

Condensed Consolidated Balance Sheets

Total Assets

Maximum Exposure 

(In millions) to Loss

Investment 

securities

Accrued Interest 

Receivable and 

Other Assets(1) Liabilities(1)

Single-Family:

 Securitization products $916 $171 $424 $30,593 $24,828 

Resecuritization products(2) 7,135 76 618 114,359 114,359 

CRT products(3) — 163 142 31,399 63 

Total Single-Family 8,051 410 1,184 176,351 139,250 

Multifamily:

Securitization products(4) 7,161 4,872 4,718 355,723 315,542 

CRT products(3) — 2 5 1,165 4 

Total Multifamily 7,161 4,874 4,723 356,888 315,546 

Other — 7 5 153 478 

Total $15,212 $5,291 $5,912 $533,392 $455,274 

Referenced footnotes are included after the prior period table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 2

Freddie Mac 2Q 2023 Form 10-Q 53
December 31, 2022

Carrying Amounts of the Assets and Liabilities On the 

Condensed Consolidated Balance Sheets

Total Assets

Maximum Exposure 

(In millions) to Loss

Investment 

securities

Accrued Interest 

Receivable and 

Other Assets(1) Liabilities(1)

Single-Family:

Securitization products $965 $175 $436 $31,614 $25,772 

Resecuritization products(2) 5,092 61 659 119,267 119,267 

CRT products(3) — 197 52 30,549 105 

Total Single-Family 6,057 433 1,147 181,430 145,144 

Multifamily:

Securitization products(4) 7,808 4,931 4,920 360,869 319,117 

CRT products(3) — 2 2 972 — 

Total Multifamily 7,808 4,933 4,922 361,841 319,117 

Other — 8 5 185 435 

Total $13,865 $5,374 $6,074 $543,456 $464,696 

(1) Other assets primarily include our guarantee assets. Liabilities primarily include our guarantee obligations.

(2) Total assets and maximum exposure to loss are based on the UPB of Fannie Mae securities underlying commingled Freddie Mac resecuritization trusts. We exclude 

noncommingled resecuritization trusts from these amounts as we have already guaranteed the underlying collateral and therefore noncommingled resecuritizations 

do not involve any incremental assets or create any incremental exposure to credit risk. Total assets exclude $0.1 billion as of both June 30, 2023 and 

December 31, 2022, of Fannie Mae securities that we have guaranteed that are included in resecuritization trusts that we have consolidated as we own all of the 

outstanding securities issued by the VIE.

(3) Maximum exposure to loss is based on our expected recovery receivables. We also have exposure to loss from our obligations to make certain payments to the VIE 

to support payment of the interest due on the notes issued by the VIE, which we account for as derivative instruments. The notional value of these derivative 

instruments is equal to the total assets of the VIE.

(4) Includes total assets of $0.3 billion and $0.4 billion as of June 30, 2023 and December 31, 2022, respectively, related to VIEs in which our interest would no longer 

absorb significant variability as the guaranteed securities have completely paid off. 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 2

Freddie Mac 2Q 2023 Form 10-Q 54
NOTE 3

Mortgage Loans

The table below provides details of the loans on our condensed consolidated balance sheets.

Table 3.1 - Mortgage Loans 

June 30, 2023 December 31, 2022

(In millions) Single-Family Multifamily Total Single-Family Multifamily Total

Held-for-sale UPB $3,231 $9,319 $12,550 $3,564 $9,544 $13,108 

Cost basis and fair value adjustments, net (686) (169) (855) (696) (215) (911) 

Total held-for-sale loans, net 2,545 9,150 11,695 2,868 9,329 12,197 

Held-for-investment UPB 2,961,459 51,309 3,012,768 2,941,505 48,379 2,989,884 

Cost basis and fair value adjustments, net(1) 37,325 (150) 37,175 39,896 (71) 39,825 

Allowance for credit losses (7,088) (251) (7,339) (7,314) (77) (7,391) 

 Total held-for-investment loans, net(2) 2,991,696 50,908 3,042,604 2,974,087 48,231 3,022,318 

Total mortgage loans, net $2,994,241 $60,058 $3,054,299 $2,976,955 $57,560 $3,034,515 

(1) Includes ($0.3) billion of basis adjustments maintained on a closed portfolio basis related to existing portfolio layer method hedge relationships as of June 30, 2023. 

(2) Includes $1.4 billion and $1.2 billion of multifamily held-for-investment loans for which we have elected the fair value option as of June 30, 2023 and December 31, 

2022, respectively.

For the purposes of certain single-family mortgage loan disclosures below, we present loans by class of financing receivable 

type. Financing receivable classes used for disclosure consist of: "20- and 30-year or more, amortizing fixed-rate," "15-year or 

less, amortizing fixed-rate," and "adjustable-rate and other." The "other" class consists of Alt-A, interest-only, and option ARM 

loans.

The table below provides details of the UPB of loans we purchased and sold during the periods presented.

Table 3.2 - Loans Purchased and Sold

(In millions) 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Single-Family:

Purchases:

 Held-for-investment loans $82,850 $137,665 $141,815 $344,600 

Sales of held-for-sale loans(1) — 1,429 — 1,444 

Multifamily:

Purchases:

 Held-for-investment loans 4,661 2,957 8,010 5,522 

 Held-for-sale loans 7,398 11,372 10,093 23,639 

Sales of held-for-sale loans(2) 8,626 14,899 14,776 29,191 

(1) Our sales of single-family loans reflect the sale of single-family seasoned loans.

(2) Our sales of multifamily loans occur primarily through the issuance of Multifamily K Certificates. 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 55
Reclassifications 

The table below presents the allowance for credit losses or valuation allowance that was reversed or established due to loan 

reclassifications between held-for-investment and held-for-sale during the periods presented. 

Table 3.3 - Loan Reclassifications(1) 

2Q 2023 2Q 2022

(In millions) UPB

Allowance for 

Credit Losses 

Reversed or 

(Established)

Valuation 

Allowance 

(Established) 

or Reversed UPB

Allowance for 

Credit Losses 

Reversed or 

(Established)

Valuation 

Allowance 

(Established) 

or Reversed

Single-Family reclassifications from:

Held-for-investment to held-for-sale $— $— $— $325 $10 $— 

Held-for-sale to held-for-investment(2) — — — 75 (4) 3 

Multifamily reclassifications from:

Held-for-investment to held-for-sale 735 1 (6) 386 1 — 

 Held-for-sale to held-for-investment(2) 161 — — 39 — — 

YTD 2023 YTD 2022

(In millions) UPB

Allowance for 

Credit Losses 

Reversed or 

(Established)

Valuation 

Allowance 

(Established) 

or Reversed UPB

Allowance for 

Credit Losses 

Reversed or 

(Established)

Valuation 

Allowance 

(Established) 

or Reversed

Single-Family reclassifications from:

Held-for-investment to held-for-sale $— $— $— $573 $10 $— 

Held-for-sale to held-for-investment(2) 48 4 4 137 (7) 3 

Multifamily reclassifications from:

Held-for-investment to held-for-sale 5,466 2 (33) 701 1 — 

 Held-for-sale to held-for-investment(2) 722 — 16 285 — — 

(1) Amounts exclude reclassifications related to loans for which we have elected the fair value option.

(2) Allowance for credit losses established upon loan reclassifications from held-for-sale to held-for-investment to reflect the net amount we expect to collect on the 

loan. Loans with prior charge-offs may have a negative allowance for credit losses established upon reclassification.

Interest Income

The table below presents the amortized cost basis of non-accrual loans as of the beginning and the end of the periods 

presented, including the interest income recognized for the period that is related to the loans on non-accrual status as of the 

period end.

Table 3.4 - Amortized Cost Basis of Held-for-Investment Loans on Non-Accrual(1)

Non-Accrual Amortized Cost Basis Interest Income Recognized(2)

(In millions) June 30, 2023 March 31, 2023 2Q 2023 YTD 2023

Single-Family:

20- and 30-year or more, amortizing fixed-rate $11,989 $9,348 $28 $78 

15-year or less, amortizing fixed-rate 540 434 1 2 

Adjustable-rate and other 323 332 1 2 

Total Single-Family 12,852 10,114 30 82 

Total Multifamily 56 41 1 1 

Total Single-Family and Multifamily $12,908 $10,155 $31 $83 

Referenced footnotes are included after the prior period table. 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 56
Non-Accrual Amortized Cost Basis Interest Income Recognized(2)

(In millions) June 30, 2022 March 31, 2022 2Q 2022 YTD 2022

Single-Family:

20- and 30-year or more, amortizing fixed-rate $11,021 $13,831 $40 $80 

15-year or less, amortizing fixed-rate 562 684 1 3 

Adjustable-rate and other 435 580 1 3 

Total Single-Family 12,018 15,095 42 86 

Total Multifamily 42 42 — — 

Total Single-Family and Multifamily $12,060 $15,137 $42 $86 

(1) Excludes amounts related to loans for which we have elected the fair value option.

(2) Represents the amount of payments received during the period, including those received while the loans were on accrual status, for the held-for-investment loans on 

non-accrual status as of period end.

The table below provides the amount of accrued interest receivable, net presented on our condensed consolidated balance 

sheets and the amount of accrued interest receivable related to loans on non-accrual status at the end of the periods that was 

charged off.

Table 3.5 - Accrued Interest Receivable, Net and Related Charge-Offs

Accrued Interest Receivable, Net Accrued Interest Receivable Related Charge-Offs

(In millions) June 30, 2023 December 31, 2022 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Single-Family loans $8,285 $7,967 ($88) ($58) ($136) ($145) 

Multifamily loans 234 220 — — — — 

Credit Quality

Single-Family

The current LTV ratio is one key factor we consider when estimating our allowance for credit losses for single-family loans. As 

current LTV ratios increase, the borrower's equity in the home decreases, which may negatively affect the borrower's ability to 

refinance (outside of our relief refinance programs) or to sell the property for an amount at or above the balance of the 

outstanding loan.

The table below presents the amortized cost basis of single-family held-for-investment loans by current LTV ratio. Our current 

LTV ratios are estimates based on available data through the end of each period presented. For reporting purposes:

n	 Alt-A loans continue to be presented in the "adjustable-rate and other" category following modification, even though the 

borrower may have provided full documentation of assets and income to complete the modification and

n Option ARM loans continue to be presented in the "adjustable-rate and other" category following modification, even 

though the modified loan no longer provides for optional payment provisions.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 57
Table 3.6 - Amortized Cost Basis of Single-Family Held-for-Investment Loans by Current LTV Ratio and Vintage

June 30, 2023

Year of Origination 

Total

(In millions) 2023 2022 2021 2020 2019 Prior

Current LTV ratio:

 20- and 30-year or more, amortizing fixed-rate

≤ 60 $14,338 $76,635 $435,402 $510,674 $90,381 $429,346 $1,556,776 

> 60 to 80 42,991 175,477 389,009 147,535 21,066 12,364 788,442 

> 80 to 90 20,207 87,422 59,288 2,371 380 418 170,086 

> 90 to 100 31,434 61,855 5,608 328 38 120 99,383 

> 100 14 2,459 101 4 5 121 2,704 

 Total 20- and 30-year or more, amortizing fixed-rate 108,984 403,848 889,408 660,912 111,870 442,369 2,617,391 

 Current year-to-date gross write-offs(1) — 5 11 3 2 20 41 

 15-year or less, amortizing fixed-rate

≤ 60 1,753 18,368 121,835 104,298 13,525 64,685 324,464 

> 60 to 80 1,958 11,244 11,942 925 47 12 26,128 

> 80 to 90 340 1,092 94 2 1 2 1,531 

> 90 to 100 192 180 3 — — — 375 

> 100 — 6 — — — 1 7 

 Total 15-year or less, amortizing fixed-rate 4,243 30,890 133,874 105,225 13,573 64,700 352,505 

 Current year-to-date gross write-offs(1) — — 1 — — — 1 

 Adjustable-rate and other

≤ 60 186 1,416 2,970 1,499 604 14,230 20,905 

> 60 to 80 725 2,594 1,616 147 49 349 5,480 

> 80 to 90 433 1,145 108 3 1 26 1,716 

> 90 to 100 376 669 6 — — 13 1,064 

> 100 — 39 — — — 6 45 

 Total adjustable-rate and other 1,720 5,863 4,700 1,649 654 14,624 29,210 

 Current year-to-date gross write-offs(1) — — — — — — — 

Total for all loan product types by current LTV ratio:

≤ 60 16,277 96,419 560,207 616,471 104,510 508,261 1,902,145 

> 60 to 80 45,674 189,315 402,567 148,607 21,162 12,725 820,050 

> 80 to 90 20,980 89,659 59,490 2,376 382 446 173,333 

> 90 to 100 32,002 62,704 5,617 328 38 133 100,822 

> 100 14 2,504 101 4 5 128 2,756 

Total Single-Family loans $114,947 $440,601 $1,027,982 $767,786 $126,097 $521,693 $2,999,106 

Total current year-to-date gross write-offs(1) $— $5 $12 $3 $2 $20 $42 

Referenced footnotes are included after the prior period table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 58
December 31, 2022

Year of Origination 

Total

(In millions) 2022 2021 2020 2019 2018 Prior

Current LTV ratio:

 20- and 30-year or more, amortizing fixed-rate

≤ 60 $66,153 $394,498 $489,315 $87,188 $38,955 $407,819 $1,483,928 

> 60 to 80 158,421 424,141 190,167 28,991 7,870 10,426 820,016 

> 80 to 90 79,901 90,006 4,405 569 164 419 175,464 

> 90 to 100 86,109 8,911 397 56 24 143 95,640 

> 100 2,568 49 6 6 5 156 2,790 

 Total 20- and 30-year or more, amortizing fixed-rate 393,152 917,605 684,290 116,810 47,018 418,963 2,577,838 

 15-year or less, amortizing fixed-rate

≤ 60 16,752 119,379 109,685 14,606 5,578 68,240 334,240 

> 60 to 80 13,042 22,007 2,503 132 16 16 37,716 

> 80 to 90 1,601 368 7 — — 1 1,977 

> 90 to 100 570 5 — — — 1 576 

> 100 3 — — — — 1 4 

 Total 15-year or less, amortizing fixed-rate 31,968 141,759 112,195 14,738 5,594 68,259 374,513 

 Adjustable-rate and other

≤ 60 1,255 2,779 1,524 634 428 15,139 21,759 

> 60 to 80 2,322 1,956 214 76 28 445 5,041 

> 80 to 90 1,127 186 5 1 1 34 1,354 

> 90 to 100 836 11 — — — 14 861 

> 100 26 — — — — 9 35 

 Total adjustable-rate and other 5,566 4,932 1,743 711 457 15,641 29,050 

Total for all loan product types by current LTV ratio:

≤ 60 84,160 516,656 600,524 102,428 44,961 491,198 1,839,927 

> 60 to 80 173,785 448,104 192,884 29,199 7,914 10,887 862,773 

> 80 to 90 82,629 90,560 4,417 570 165 454 178,795 

> 90 to 100 87,515 8,927 397 56 24 158 97,077 

> 100 2,597 49 6 6 5 166 2,829 

Total Single-Family loans $430,686 $1,064,296 $798,228 $132,259 $53,069 $502,863 $2,981,401 

(1) Excludes write-offs related to accrued interest receivable and advances of pre-foreclosure costs.

Multifamily

The table below presents the amortized cost basis of our multifamily held-for-investment loans, for which we have not elected 

the fair value option, by credit quality indicator, based on available data through the end of each period presented. These 

indicators involve significant management judgment and are defined as follows: 

n	 "Pass" is current and adequately protected by the borrower's current financial strength and debt service capacity; 

n	 "Special mention" has administrative issues that may affect future repayment prospects but does not have current credit 

weaknesses. In addition, this category generally includes loans in forbearance; 

n	 "Substandard" has a weakness that jeopardizes the timely full repayment; and 

n	 "Doubtful" has a weakness that makes collection or liquidation in full highly questionable and improbable based on existing 

conditions. 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 59
Table 3.7 - Amortized Cost Basis of Multifamily Held-for-Investment Loans by Credit Quality Indicator and Vintage

June 30, 2023

Year of Origination

(In millions) 2023 2022 2021 2020 2019 Prior Total

Revolving 

Loans

Category:

Pass $6,026 $18,547 $7,660 $6,427 $4,556 $3,262 $2,081 $48,559 

Special mention 20 14 4 109 226 61 — 434 

Substandard — — 64 77 205 461 — 807 

Doubtful — — — — — — — — 

Total $6,046 $18,561 $7,728 $6,613 $4,987 $3,784 $2,081 $49,800 

December 31, 2022

Year of Origination

(In millions) 2022 2021 2020 2019 2018 Prior Total

Revolving 

Loans

Category:

Pass $21,854 $7,638 $6,546 $4,784 $1,077 $2,646 $1,924 $46,469 

Special mention — 39 65 232 7 113 — 456 

Substandard — 1 3 27 7 131 — 169 

Doubtful — — — — — — — — 

Total $21,854 $7,678 $6,614 $5,043 $1,091 $2,890 $1,924 $47,094 

Past Due Status

The table below presents the amortized cost basis of our single-family and multifamily held-for-investment loans, for which we 

have not elected the fair value option, by payment status.

Table 3.8 - Amortized Cost Basis of Held-for-Investment Loans by Payment Status

June 30, 2023

(In millions) Current

One

Month

Past Due

Two

Months

Past Due

Three Months or

More Past Due,

or in Foreclosure(1) Total

Three Months or 

More Past Due, 

and Accruing 

Interest

Non-Accrual 

With No 

Allowance(2)

Single-Family:

20- and 30-year or more, amortizing 

fixed-rate $2,581,894 $19,586 $4,299 $11,612 $2,617,391 $— $507 

 15-year or less, amortizing fixed-rate 350,510 1,257 212 526 352,505 — 8 

Adjustable-rate and other 28,524 301 81 304 29,210 — 56 

Total Single-Family 2,960,928 21,144 4,592 12,442 2,999,106 — 571 

Total Multifamily 49,713 30 1 56 49,800 — 15 

Total Single-Family and Multifamily $3,010,641 $21,174 $4,593 $12,498 $3,048,906 $— $586 

Referenced footnotes are included after the prior period table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 60
December 31, 2022

(In millions) Current

One

Month

Past Due

Two

Months

Past Due

Three Months or

More Past Due,

or in Foreclosure(1) Total

Three Months or 

More Past Due, 

and Accruing 

Interest

Non-Accrual 

with No 

Allowance(2)

Single-Family:

20- and 30-year or more, amortizing 

fixed-rate $2,541,057 $19,820 $4,603 $12,358 $2,577,838 $3,432 $522 

15-year or less, amortizing fixed-rate 372,065 1,590 250 608 374,513 191 9 

Adjustable-rate and other 28,262 325 88 375 29,050 30 67 

Total Single-Family 2,941,384 21,735 4,941 13,341 2,981,401 3,653 598 

Total Multifamily 47,039 13 — 42 47,094 — 42 

Total Single-Family and Multifamily $2,988,423 $21,748 $4,941 $13,383 $3,028,495 $3,653 $640 

(1) Includes $1.9 billion and $1.6 billion of single-family loans that were in the process of foreclosure as of June 30, 2023 and December 31, 2022, respectively.

(2) Loans with no allowance for loan losses primarily represent those loans that were previously charged off and therefore the collateral value is sufficiently in excess of 

the amortized cost to result in recovery of the entire amortized cost basis if the property were foreclosed upon or otherwise subject to disposition. We exclude the 

amounts of allowance for credit losses on accrued interest receivable and advances of pre-foreclosure costs when determining whether a loan has an allowance for 

credit losses.

Loan Restructurings

Single-Family Loan Restructurings

We offer several types of restructurings to single-family borrowers that may result in a payment delay, interest rate reduction, 

term extension, or combination thereof. We do not offer principal forgiveness. 

For purposes of the disclosure related to single-family loan restructurings involving borrowers experiencing financial difficulty, 

we exclude loans that were held-for-sale either at the time of restructuring or at the period end. The table below presents the 

amortized cost basis of single-family held-for-investment loan restructurings involving borrowers experiencing financial difficulty 

that we entered into during the periods presented. The amortized cost basis of loans in trial period modification plans was $1.8 

billion and $2.6 billion as of June 30, 2023 and June 30, 2022, respectively. Most of these loans are 20- and 30-year or more, 

amortizing fixed-rate loans.

Table 3.9 - Single-Family Loan Restructurings Involving Borrowers Experiencing Financial Difficulty(1)

2Q 2023

(Dollars in millions)

Payment 

Delay(2)

Payment Delay 

and Term 

Extension

Payment Delay, 

Term Extension, 

and Interest Rate 

Reduction Total

Total as % of 

Class of 

Financing 

Receivable(3)

Single-Family:

20- and 30-year or more, amortizing fixed-rate $5,328 $1,116 $32 $6,476 0.2 %

15-year or less, amortizing fixed-rate 265 — — 265 0.1 

Adjustable-rate and other 63 8 1 72 0.2 

Total Single-Family loan restructurings $5,656 $1,124 $33 $6,813 0.2 

2Q 2022

(Dollars in millions)

Payment 

Delay(2)

Payment Delay 

and Term 

Extension

Payment Delay, 

Term Extension, 

and Interest Rate 

Reduction Total

Total as % of 

Class of 

Financing 

Receivable(3)

Single-Family:

20- and 30-year or more, amortizing fixed-rate $6,832 $520 $2,476 $9,828 0.4 %

15-year or less, amortizing fixed-rate 429 15 16 460 0.1 

Adjustable-rate and other 139 14 50 203 0.7 

Total Single-Family loan restructurings $7,400 $549 $2,542 $10,491 0.4 

Referenced footnotes are included after the year-to-date table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 61
YTD 2023

(Dollars in millions)

Payment 

Delay(2)

Payment Delay 

and Term 

Extension

Payment Delay, 

Term Extension, 

and Interest Rate 

Reduction Total

Total as % of 

Class of 

Financing 

Receivable(3)

Single-Family:

20- and 30-year or more, amortizing fixed-rate $10,607 $2,148 $118 $12,873 0.5 %

15-year or less, amortizing fixed-rate 547 — — 547 0.2 

Adjustable-rate and other 123 18 5 146 0.5 

Total Single-Family loan restructurings $11,277 $2,166 $123 $13,566 0.5 

YTD 2022

(Dollars in millions)

Payment 

Delay(2)

Payment Delay 

and Term 

Extension

Payment Delay, 

Term Extension, 

and Interest Rate 

Reduction Total

Total as % of 

Class of 

Financing 

Receivable(3)

Single-Family:

20- and 30-year or more, amortizing fixed-rate $14,268 $1,172 $5,361 $20,801 0.8 %

15-year or less, amortizing fixed-rate 910 28 69 1,007 0.3 

Adjustable-rate and other 314 29 126 469 1.6 

Total Single-Family loan restructurings $15,492 $1,229 $5,556 $22,277 0.8 

(1) Type of loan restructurings reflects the cumulative effects of the loan restructurings received during the period. Includes loan modifications in the period in which 

the borrower completes the trial period and the loan is permanently modified.

(2) Includes $2.2 billion and $4.8 billion related to payment deferral plans for 2Q 2023 and YTD 2023, respectively, compared to $3.6 billion and $8.4 billion for 2Q 

2022 and YTD 2022, respectively. Also includes forbearance plans, repayment plans, and loan modifications that only involve payment delays.

(3) Based on the amortized cost basis as of period end, divided by the total period-end amortized cost basis of the corresponding financing receivable class of singlefamily held-for-investment loans.

The table below shows the financial effect of single-family held-for-investment loan restructurings involving borrowers 

experiencing financial difficulty that we entered into during the periods presented.

Table 3.10 – Financial Effects of Single-Family Loan Restructurings Involving Borrowers Experiencing Financial 

Difficulty(1)

2Q 2023

(Dollars in thousands)

Weighted-Average 

Interest Rate 

Reduction

Weighted-Average 

Months of Term 

Extension

Weighted-Average 

Payment Deferral or 

Principal 

Forbearance(2)

Single-Family:

20- and 30-year or more, amortizing fixed-rate 1.1 % 179 $18 

15-year or less, amortizing fixed-rate — 0 16 

Adjustable-rate and other 1.6 201 15 

2Q 2022

(Dollars in thousands)

Weighted-Average 

Interest Rate 

Reduction

Weighted-Average 

Months of Term 

Extension

Weighted-Average 

Payment Deferral or 

Principal 

Forbearance(2)

Single-Family:

20- and 30-year or more, amortizing fixed-rate 1.4 % 185 $21 

15-year or less, amortizing fixed-rate 0.6 359 22 

Adjustable-rate and other 2.2 234 26 

Referenced footnotes are included after the year-to-date table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 62
YTD 2023

(Dollars in thousands)

Weighted-Average 

Interest Rate 

Reduction

Weighted-Average 

Months of Term 

Extension

Weighted-Average 

Payment Deferral or 

Principal 

Forbearance(2)

Single-Family:

20- and 30-year or more, amortizing fixed-rate 1.0 % 181 $17 

15-year or less, amortizing fixed-rate — 0 16 

Adjustable-rate and other 1.9 200 17 

YTD 2022

(Dollars in thousands)

Weighted-Average 

Interest Rate 

Reduction

Weighted-Average 

Months of Term 

Extension

Weighted-Average 

Payment Deferral or 

Principal 

Forbearance(2)

Single-Family:

20- and 30-year or more, amortizing fixed-rate 1.5 % 187 $23 

15-year or less, amortizing fixed-rate 0.6 358 24 

Adjustable-rate and other 2.3 228 27 

(1) Averages are based on payment deferral plans and loan modifications completed during the periods presented. The financial effects of forbearance plans and 

repayment plans consist of a payment delay of between one and twelve months. In addition, the financial effect of a forbearance plan is included at the time the 

forbearance plan is completed if the borrower exits forbearance by entering into a payment deferral plan or loan modification.

(2) Primarily related to payment deferral plans. Amounts are based on non-interest-bearing principal balances on the restructured loans.

The following table provides the amortized cost basis of single-family held-for-investment loans that had a payment default (i.e., 

loans that became two months delinquent) during the periods presented and had been restructured within the previous 12 

months preceding the payment default, when the borrower was experiencing financial difficulty at the time of the restructuring. 

Since we adopted ASU 2022-02 prospectively, single-family held-for-investment loans that were restructured prior to January 

1, 2022, the date we adopted such guidance, have been excluded from the disclosures related to loan restructurings.

Table 3.11 - Subsequent Defaults of Single-Family Restructured Loans Involving Borrowers Experiencing Financial 

Difficulty(1)

2Q 2023

(In millions) Payment Delay

Payment Delay 

and Term 

Extension

Payment Delay, Term 

Extension, and Interest 

Rate Reduction Total

Single-Family:

20- and 30-year or more, amortizing fixed-rate $710 $239 $131 $1,080 

15-year or less, amortizing fixed-rate 33 — — 33 

Adjustable-rate and other 11 2 2 15 

Total Single-Family $754 $241 $133 $1,128 

2Q 2022

(In millions) Payment Delay

Payment Delay 

and Term 

Extension

Payment Delay, Term 

Extension, and Interest 

Rate Reduction Total

Single-Family:

20- and 30-year or more, amortizing fixed-rate $364 $30 $69 $463 

15-year or less, amortizing fixed-rate 18 — — 18 

Adjustable-rate and other 10 2 1 13 

Total Single-Family $392 $32 $70 $494 

Referenced footnotes are included after the year-to-date table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 63
YTD 2023

(In millions) Payment Delay

Payment Delay 

and Term 

Extension

Payment Delay, Term 

Extension, and Interest 

Rate Reduction Total

Single-Family:

20- and 30-year or more, amortizing fixed-rate $1,286 $381 $305 $1,972 

15-year or less, amortizing fixed-rate 59 — — 59 

Adjustable-rate and other 18 3 6 27 

Total Single-Family $1,363 $384 $311 $2,058 

YTD 2022

(In millions) Payment Delay

Payment Delay 

and Term 

Extension

Payment Delay, Term 

Extension, and Interest 

Rate Reduction Total

Single-Family:

20- and 30-year or more, amortizing fixed-rate $717 $38 $76 $831 

15-year or less, amortizing fixed-rate 45 — — 45 

Adjustable-rate and other 24 2 1 27 

Total Single-Family $786 $40 $77 $903 

(1) Excludes forbearance plans and repayment plans as borrowers are typically past due based on the loan's original contractual terms at the time the borrowers enter 

into these plans.

The following table provides the single-family held-for-investment loan performance in the 12 months after a restructuring 

involving borrowers experiencing financial difficulty. While a single-family loan is in a forbearance plan or repayment plan, 

payments continue to be due based on the loan’s original contractual terms because the loan has not been permanently 

modified. As a result, we report single-family loans in forbearance plans and repayment plans as delinquent to the extent that 

payments are past due based on the loan’s original contractual terms. Loans that have been restructured by entering into a 

payment deferral plan or loan modification are reported as delinquent to the extent that payments are past due based on the 

loan's restructured terms.

Table 3.12 - Amortized Cost Basis of Single-Family Restructured Loans Involving Borrowers Experiencing Financial 

Difficulty by Payment Status

June 30, 2023

(In millions) Current

One Month Past 

Due

Two Months 

Past Due

Three Months 

or More Past 

Due Total

Single-Family:

20- and 30-year or more, amortizing fixed-rate $13,660 $2,341 $1,478 $6,244 $23,723 

15-year or less, amortizing fixed-rate 572 94 57 281 1,004 

Adjustable-rate and other 158 32 19 84 293 

Total Single-Family $14,390 $2,467 $1,554 $6,609 $25,020 

June 30, 2022

(In millions) Current

One Month Past 

Due

Two Months 

Past Due

Three Months 

or More Past 

Due Total

Single-Family:

20- and 30-year or more, amortizing fixed-rate $13,524 $1,905 $1,224 $4,148 $20,801 

15-year or less, amortizing fixed-rate 610 97 72 228 1,007 

Adjustable-rate and other 292 31 21 125 469 

Total Single-Family $14,426 $2,033 $1,317 $4,501 $22,277 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 64
Non-Cash Investing and Financing Activities

During YTD 2023 and YTD 2022, we acquired $100.9 billion and $247.8 billion, respectively, of loans held-for-investment in 

exchange for the issuance of debt of consolidated trusts in guarantor swap transactions. We received approximately $46.3 

billion and $105.8 billion of loans held-for-investment from sellers during YTD 2023 and YTD 2022, respectively, to satisfy 

advances to lenders that were recorded in other assets on our condensed consolidated balance sheets.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Freddie Mac 2Q 2023 Form 10-Q 65
NOTE 4 

Guarantees and Other Off-Balance Sheet Credit Exposures

Guarantee Activities 

The table below shows information about our mortgage-related guarantees and guarantees of Fannie Mae securities, including 

the UPB of the loans or securities underlying the guarantee, the maximum potential amount of future payments that we could 

be required to make under the guarantee, the liability we have recognized on our condensed consolidated balance sheets for 

the guarantee, and the maximum remaining term of the guarantee. This table does not include our unrecognized guarantees, 

such as guarantees to consolidated VIEs or to resecuritization trusts that do not expose us to incremental credit risk. We do not 

believe the potential amount of future payments we could be required to make is representative of the actual payments we will 

be required to make or the actual loss we are likely to incur, based on our historical loss experience and after consideration of 

proceeds from related collateral liquidation, including possible recoveries under credit enhancements.

Table 4.1 - Financial Guarantees

June 30, 2023

(Dollars in millions, terms in years) UPB Maximum Exposure

Recognized 

Liability(1)

Maximum Remaining 

Term

Single-Family mortgage-related guarantees:

Nonconsolidated securitization products(2) $30,583 $24,828 $379 39

Other mortgage-related guarantees 9,079 9,079 181 29

Total Single-Family mortgage-related guarantees 39,662 33,907 560 

Multifamily mortgage-related guarantees:

Nonconsolidated securitization products(2)(3) 355,723 315,542 4,688 37

Other mortgage-related guarantees 10,847 10,847 400 35

Total Multifamily mortgage-related guarantees 366,570 326,389 5,088 

Guarantees of Fannie Mae securities(4) 114,359 114,359 — 38

Other 153 478 — 30

December 31, 2022

(Dollars in millions, terms in years) UPB Maximum Exposure

Recognized 

Liability(1)

Maximum Remaining 

Term

Single-Family mortgage-related guarantees:

Nonconsolidated securitization products(2) $31,604 $25,772 $391 40

Other mortgage-related guarantees 9,476 9,476 203 29

Total Single-Family mortgage-related guarantees 41,080 35,248 594 

Multifamily mortgage-related guarantees:

Nonconsolidated securitization products(2)(3) 360,869 319,117 4,889 37

Other mortgage-related guarantees 10,510 10,510 379 36

Total Multifamily mortgage-related guarantees 371,379 329,627 5,268 

Guarantees of Fannie Mae securities(4) 119,267 119,267 — 39

Other 185 435 — 29

(1) Excludes allowance for credit losses on off-balance sheet credit exposures. See Note 5 for additional information on our allowance for credit losses on off-balance 

sheet credit exposures.

(2) Maximum exposure is based on remaining UPB of the guaranteed securities issued by the VIE. 

(3) Includes UPB of $0.3 billion and $0.4 billion as of June 30, 2023 and December 31, 2022, respectively, related to VIEs in which our interest would no longer absorb 

significant variability as the guaranteed securities have completely paid off. In addition, includes guarantees that are accounted for as derivatives with UPB of 

$2.1 billion as of both June 30, 2023 and December 31, 2022.

(4) Excludes $0.1 billion as of both June 30, 2023 and December 31, 2022, of Fannie Mae securities that we have guaranteed that are included in resecuritization 

trusts that we have consolidated as we own all of the outstanding securities issued by the VIE.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Freddie Mac 2Q 2023 Form 10-Q 66
The table below shows the payment status of the mortgage loans underlying our mortgage-related guarantees.

Table 4.2 – UPB of Loans Underlying Our Mortgage-Related Guarantees by Payment Status 

June 30, 2023

(In millions) Current

One

Month

Past Due

Two

Months

Past Due

Three Months or

More Past Due,

or in Foreclosure Total

Single-Family $35,498 $1,899 $674 $1,591 $39,662 

Multifamily 365,658 86 66 760 366,570 

Total $401,156 $1,985 $740 $2,351 $406,232 

December 31, 2022

(In millions) Current

One

Month

Past Due

Two

Months

Past Due

Three Months or

More Past Due,

or in Foreclosure Total

Single-Family $36,241 $2,072 $748 $2,019 $41,080 

Multifamily 370,911 23 12 433 371,379 

Total $407,152 $2,095 $760 $2,452 $412,459 

Other Off-Balance Sheet Credit Exposures

In addition to our guarantees, we enter into other agreements that expose us to off-balance sheet credit risk. These agreements 

may require us to transfer cash before or upon settlement of our contractual obligation. We recognize an allowance for credit 

losses for those agreements not measured at fair value or otherwise recognized in the financial statements. Most of these 

commitments expire in less than one year. See Note 5 for additional discussion of our allowance for credit losses on our offbalance sheet credit exposures. The table below shows our other off-balance sheet credit exposures.

Table 4.3 – Other Off-Balance Sheet Credit Exposures

(In millions) June 30, 2023 December 31, 2022

Mortgage loan purchase commitments(1) $12,262 $9,609 

Other commitments(2) 22,556 22,293 

Total $34,818 $31,902 

(1) Includes $2.9 billion and $0.5 billion of commitments for which we have elected the fair value option as of June 30, 2023 and December 31, 2022, respectively. 

Excludes mortgage loan purchase commitments accounted for as derivative instruments. See Note 8 for additional information on commitments accounted for as 

derivative instruments.

(2) Consists of unfunded portion of revolving lines of credit, liquidity guarantees, and other commitments.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Freddie Mac 2Q 2023 Form 10-Q 67
NOTE 5

Allowance for Credit Losses

The table below summarizes changes in our allowance for credit losses.

Table 5.1 - Details of the Allowance for Credit Losses 

2Q 2023 2Q 2022 YTD 2023 YTD 2022

 (In millions) 

SingleFamilyMultifamily TotalSingleFamilyMultifamily TotalSingleFamilyMultifamily TotalSingleFamilyMultifamily Total

Beginning balance $8,097 $224 $8,321 $4,849 $72 $4,921 $7,746 $147 $7,893 $5,440 $78 $5,518 

Provision (benefit) for 

credit losses (638) 101 (537) 298 9 307 (320) 178 (142) (533) 3 (530) 

Charge-offs (111) — (111) (107) — (107) (201) — (201) (280) — (280) 

Recoveries collected 29 — 29 43 — 43 61 — 61 95 — 95 

Other(1) 80 — 80 259 — 259 171 — 171 620 — 620 

Ending balance $7,457 $325 $7,782 $5,342 $81 $5,423 $7,457 $325 $7,782 $5,342 $81 $5,423 

Components of the ending balance of the allowance for credit losses:

Mortgage loans heldfor-investment $7,088 $251 $7,339 $4,904 $35 $4,939 

Other(2) 369 74 443 438 46 484 

Total ending balance $7,457 $325 $7,782 $5,342 $81 $5,423 

(1) Primarily includes capitalization of past due interest related to non-accrual loans that receive payment deferral plans and loan modifications.

(2) Includes allowance for credit losses related to advances of pre-foreclosure costs, accrued interest receivable, and off-balance sheet credit exposures.

n 2Q 2023 vs. 2Q 2022 - The benefit for credit losses for 2Q 2023 was primarily driven by a credit reserve release in SingleFamily due to improvements in observed and forecasted house price appreciation, partially offset by a credit reserve build 

in Multifamily due to deterioration in forecasted multifamily market conditions and current loan performance. The provision 

for credit losses for 2Q 2022 was primarily driven by a credit reserve build in Single-Family due to portfolio growth and 

deterioration in forecasted economic conditions.

n YTD 2023 vs. YTD 2022 - The benefit for credit losses for YTD 2023 was primarily driven by a credit reserve release in 

Single-Family due to improvements in forecasted house price appreciation, partially offset by a credit reserve build in 

Multifamily due to increased uncertainty in forecasted economic conditions and multifamily market conditions as well as 

deterioration in loan performance. The benefit for credit losses for YTD 2022 was primarily driven by a credit reserve 

release in Single-Family due to improvements in observed house price appreciation.

In addition, charge-offs decreased for YTD 2023, compared to YTD 2022, primarily due to a decrease in charge-offs of accrued 

interest receivable.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 5

Freddie Mac 2Q 2023 Form 10-Q 68
NOTE 6

Investment Securities

The table below summarizes the fair values of our investments in debt securities by classification.

Table 6.1 - Investment Securities

(In millions) June 30, 2023 December 31, 2022

Trading securities $35,687 $32,167 

Available-for-sale securities 5,942 6,534 

Total fair value of investment securities $41,629 $38,701 

Trading Securities 

The table below presents the fair values of our trading securities by major security type. Our non-mortgage-related securities 

primarily consist of investments in U.S. Treasury securities. 

Table 6.2 - Trading Securities

(In millions) June 30, 2023 December 31, 2022

Mortgage-related securities $10,256 $8,334 

Non-mortgage-related securities 25,431 23,833 

Total fair value of trading securities $35,687 $32,167 

For trading securities held at June 30, 2023, we recorded net unrealized losses of $0.3 billion and $0.2 billion during 2Q 2023

and YTD 2023, respectively. For trading securities held at June 30, 2022, we recorded net unrealized losses of $0.3 billion and 

$1.1 billion during 2Q 2022 and YTD 2022, respectively. 

Available-for-Sale Securities 

The table below provides details of the securities classified as available-for-sale on our condensed consolidated balance 

sheets. At June 30, 2023 and December 31, 2022, all available-for-sale securities were mortgage-related securities.

Table 6.3 - Available-for-Sale Securities 

June 30, 2023

Amortized

Cost

Basis

Gross Unrealized 

Gains in Other 

Comprehensive 

Income

Gross Unrealized

Losses in Other 

Comprehensive 

Income Fair Value

Accrued Interest 

(In millions) Receivable

Agency mortgage-related securities $5,677 $3 ($297) $5,382 $12 

Other mortgage-related securities 383 182 (5) 560 3 

Total available-for-sale securities $6,060 $185 ($302) $5,942 $15 

December 31, 2022

Amortized

Cost

Basis

Gross Unrealized 

Gains in Other 

Comprehensive 

Income

Gross Unrealized

Losses in Other 

Comprehensive 

Income Fair Value

Accrued Interest 

(In millions) Receivable

Agency mortgage-related securities $6,215 $6 ($301) $5,920 $12 

Other mortgage-related securities 429 188 (3) 614 3 

Total available-for-sale securities $6,644 $194 ($304) $6,534 $15 

The fair value of our available-for-sale securities held at June 30, 2023 scheduled to contractually mature after ten years was 

$1.4 billion, with an additional $3.5 billion scheduled to contractually mature after five years through ten years.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 6

Freddie Mac 2Q 2023 Form 10-Q 69
The table below presents available-for-sale securities in a gross unrealized loss position and whether such securities have been 

in an unrealized loss position for less than 12 months, or 12 months or greater.

Table 6.4 - Available-for-Sale Securities in a Gross Unrealized Loss Position

June 30, 2023

Less than 12 Months 12 Months or Greater

(In millions) Fair Value

Gross 

Unrealized 

Losses Fair Value

Gross 

Unrealized 

Losses

Agency mortgage-related securities $2,346 ($103) $2,520 ($194) 

Other mortgage-related securities 48 (3) 14 (2) 

Total available-for-sale securities in a gross unrealized loss position $2,394 ($106) $2,534 ($196) 

December 31, 2022

Less than 12 Months 12 Months or Greater

(In millions) Fair Value

Gross 

Unrealized 

Losses Fair Value

Gross 

Unrealized 

Losses

Agency mortgage-related securities $5,086 ($253) $325 ($48) 

Other mortgage-related securities 46 (3) 5 — 

Total available-for-sale securities in a gross unrealized loss position $5,132 ($256) $330 ($48) 

At June 30, 2023, the gross unrealized losses relate to 207 securities. 

The table below summarizes the gross realized gains and gross realized losses from sales of available-for-sale securities. 

Table 6.5 - Gross Realized Gains and Gross Realized Losses from Sales of Available-for-Sale Securities 

(In millions) 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Gross realized gains $3 $1 $5 $1 

Gross realized losses (2) (3) (4) (4) 

Net realized gains (losses) $1 ($2) $1 ($3) 

Non-Cash Investing and Financing Activities

During YTD 2023 and YTD 2022, we recognized $1.7 billion and $8.3 billion, respectively, of investment securities in exchange 

for the issuance of debt of consolidated trusts through partial sales of commingled single-class resecuritization products that 

were previously consolidated.

During YTD 2023 and YTD 2022, we derecognized $2.8 billion and $7.7 billion, respectively, of mortgage-related securities and 

debt of consolidated trusts where we were no longer deemed the primary beneficiary.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 6

Freddie Mac 2Q 2023 Form 10-Q 70
NOTE 7

Debt

The table below summarizes the balances of total debt on our condensed consolidated balance sheets.

Table 7.1 - Total Debt

(In millions) June 30, 2023 December 31, 2022

Debt of consolidated trusts $3,007,278 $2,979,070 

Debt of Freddie Mac:

Short-term debt 11,330 7,712 

Long-term debt 170,478 159,050 

Total debt of Freddie Mac 181,808 166,762 

Total debt $3,189,086 $3,145,832 

As of June 30, 2023, our aggregate indebtedness pursuant to the Purchase Agreement was $192.0 billion, which was below the 

current $270.0 billion debt cap limit. Our aggregate indebtedness calculation primarily includes the par value of short- and longterm debt.

Debt of Consolidated Trusts 

The table below summarizes the debt of consolidated trusts based on underlying loan product type.

Table 7.2 - Debt of Consolidated Trusts

June 30, 2023 December 31, 2022

(Dollars in millions)

Contractual

Maturity UPB

Carrying 

Amount(1)

Weighted

Average

Coupon(2)

Contractual

Maturity UPB

Carrying 

Amount(1)

Weighted

Average

Coupon(2)

Single-Family:

20-and 30-year or more, fixed-rate 2023 - 2061 $2,551,815 $2,592,440 2.89 % 2023 - 2061 $2,507,235 $2,550,137 2.76 %

15-year or less, fixed-rate 2023 - 2038 346,538 352,290 2.17 2023 - 2038 367,844 374,339 2.14 

Adjustable-rate and other 2023 - 2053 24,010 24,528 3.52 2023 - 2053 23,561 24,153 3.04 

Total Single-Family 2,922,363 2,969,258 2,898,640 2,948,629 

Multifamily 2024 - 2053 38,633 38,020 2.96 2023 - 2052 30,927 30,441 2.66 

Total debt of consolidated trusts $2,960,996 $3,007,278 $2,929,567 $2,979,070 

(1) Includes $1.4 billion and $1.9 billion as of June 30, 2023 and December 31, 2022, respectively, of debt of consolidated trusts that represents the fair value of debt 

for which the fair value option was elected.

(2) The effective interest rate for debt of consolidated trusts was 2.50% and 2.39% as of June 30, 2023 and December 31, 2022, respectively.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 7

Freddie Mac 2Q 2023 Form 10-Q 71
Short-Term Debt

The table below summarizes the balances and effective interest rates for short-term debt.

Table 7.3 - Short-Term Debt

June 30, 2023 December 31, 2022

(Dollars in millions) Par Value

Carrying 

Amount

Weighted

Average

Effective Rate Par Value

Carrying 

Amount

Weighted

Average

Effective Rate

Short-term debt:

Discount notes and Reference Bills® $11,386 $11,330 5.08 % $6,826 $6,822 3.71 %

Medium-term notes — — — 890 890 1.81 

Securities sold under agreements to repurchase 9,168 9,168 4.99 11,991 11,991 3.86 

Offsetting arrangements(1) (9,168) (9,168) (11,991) (11,991) 

Total short-term debt $11,386 $11,330 5.08 % $7,716 $7,712 3.49 %

(1) We offset payables related to securities sold under agreements to repurchase against receivables related to securities purchased under agreements to resell on our 

condensed consolidated balance sheets, when such amounts meet the conditions for offsetting in the accounting guidance. 

Long-Term Debt

The table below summarizes our long-term debt.

Table 7.4 - Long-Term Debt

June 30, 2023 December 31, 2022

(Dollars in millions)

Contractual 

Maturity Par Value

Carrying 

Amount(1)

Weighted

Average

Effective 

Rate(2)

Contractual 

Maturity Par Value

Carrying 

Amount(1)

Weighted

Average

Effective 

Rate(2)

Long-term debt:

Fixed-rate:

Medium-term notes — callable 2023 - 2050 $132,542 $132,473 2.81 % 2023 - 2050 $103,584 $103,528 1.96 %

Medium-term notes — non-callable 2023 - 2028 1,971 1,972 0.92 2023 - 2028 2,747 2,747 0.73 

Reference Notes securities — noncallable 2023 - 2032 36,051 36,095 3.82 2023 - 2032 49,801 49,832 1.76 

SCR debt notes 2031 - 2032 84 84 13.00 2031 - 2032 90 93 13.00 

Variable-rate:

Medium-term notes — callable 2023 - 2028 2,187 2,184 4.66 2023 - 2027 4,691 4,689 3.95 

Medium-term notes — non-callable 2026 47 47 8.10 2026 47 47 8.10 

STACR 2023 - 2042 2,856 2,757 10.30 2023 - 2042 4,562 4,448 8.79 

Zero-coupon:

Medium-term notes — non-callable 2024 - 2039 4,836 3,002 6.14 2023 - 2039 4,841 2,913 6.11 

Other 2047 - 2053 — 129 0.83 2047 - 2052 — 137 0.82 

Hedging-related basis adjustments N/A (8,265) N/A (9,384) 

Total long-term debt $180,574 $170,478 3.20 % $170,363 $159,050 2.20 %

(1) Represents par value, net of associated discounts or premiums and issuance cost. Includes $0.6 billion and $1.1 billion at June 30, 2023 and December 31, 2022, 

respectively, of long-term debt that represents the fair value of debt for which the fair value option was elected.

(2) Based on carrying amount.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 7

Freddie Mac 2Q 2023 Form 10-Q 72
The table below summarizes the contractual maturities of long-term debt.

Table 7.5 - Contractual Maturities of Long-Term Debt 

June 30, 2023

(In millions) Amounts

Annual Maturities

Long-term debt (excluding STACR and SCR debt notes):

2023 $23,376 

2024 42,095 

2025 61,105 

2026 12,024 

2027 9,434 

Thereafter 29,600 

Debt of consolidated trusts, STACR, and SCR debt notes(1) 2,963,936 

Total 3,141,570 

Net discounts, premiums, debt issuance costs, hedge-related, and other basis adjustments(2) 36,186 

Total debt of consolidated trusts, STACR, SCR, and long-term debt $3,177,756 

(1) Contractual maturities of these debt securities are not presented because they are subject to prepayment risk, as their payments are based upon the performance of 

a pool of mortgage assets that may be prepaid by the related mortgage borrower at any time generally without penalty.

(2) Other basis adjustments primarily represent changes in fair value on debt where we have elected the fair value option.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 7

Freddie Mac 2Q 2023 Form 10-Q 73
NOTE 8

Derivatives

We analyze the interest-rate sensitivity of financial assets and liabilities across a variety of interest-rate scenarios based on 

market prices, models, and economics. We use derivatives primarily to hedge interest-rate sensitivity mismatches between our 

financial assets and liabilities. We designate certain derivatives as hedging instruments in qualifying hedge accounting 

relationships. Interest-rate risk management derivatives that are not designated in qualifying hedge accounting relationships are 

economic hedges of financial instruments measured at fair value on a recurring basis or of other transactions or instruments 

that expose us to interest-rate risk. 

We apply fair value hedge accounting to certain single-family mortgage loans and certain issuances of debt where we hedge 

the changes in fair value of these items attributable to the designated benchmark interest rate, using interest-rate swaps.

Derivative Assets and Liabilities at Fair Value

The table below presents the notional value and fair value of derivatives reported on our condensed consolidated balance 

sheets. 

Table 8.1 - Derivative Assets and Liabilities at Fair Value

June 30, 2023 December 31, 2022

Notional or

Contractual

Amount

Derivatives at Fair Value Notional or

Contractual

Amount

Derivatives at Fair Value

(In millions) Assets Liabilities Assets Liabilities

Not designated as hedges

Interest-rate risk management derivatives:

Swaps $743,108 $1,837 ($441) $480,824 $1,762 ($526) 

Written options 67,813 — (1,910) 46,101 — (1,857) 

Purchased options(1) 76,970 3,668 — 92,010 4,302 — 

Futures 249,149 — — 182,330 — — 

Total interest-rate risk management derivatives 1,137,040 5,505 (2,351) 801,265 6,064 (2,383) 

Mortgage commitment derivatives 58,503 6 (20) 29,354 12 (11) 

CRT-related derivatives(2) 32,681 — (149) 31,647 — (55) 

Other 13,752 13 (581) 14,426 2 (624) 

Total derivatives not designated as hedges 1,241,976 5,524 (3,101) 876,692 6,078 (3,073) 

Designated as fair value hedges

Interest-rate risk management derivatives:

Swaps 181,144 97 (7,478) 181,298 321 (7,847) 

Total derivatives designated as fair value hedges 181,144 97 (7,478) 181,298 321 (7,847) 

Receivables (payables) 52 (100) 35 (25) 

Netting adjustments(3) (5,314) 9,698 (6,127) 10,187 

Total derivative portfolio, net $1,423,120 $359 ($981) $1,057,990 $307 ($758) 

(1) Includes swaptions on credit indices with a notional or contractual amount of $5.5 billion and $10.1 billion at June 30, 2023 and December 31, 2022, respectively, 

and a fair value of $1.0 million and $2.0 million at June 30, 2023 and December 31, 2022, respectively. 

(2) Includes derivative instruments related to CRT transactions that are considered freestanding credit enhancements.

(3) Represents counterparty netting and cash collateral netting.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 8 

Freddie Mac 2Q 2023 Form 10-Q 74
Gains and Losses on Derivatives

The table below presents the gains and losses on derivatives not designated in qualifying hedge relationships. These amounts 

are reported on our condensed consolidated statements of income as investment gains, net.

Table 8.2 - Gains and Losses on Derivatives(1) 

(In millions) 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Not designated as hedges

Interest-rate risk management derivatives:

Swaps $380 ($141) $408 $249 

Written options 82 (320) 277 (684) 

Purchased options (45) 508 (549) 1,225 

Futures 519 557 212 1,425 

Total interest-rate risk management derivatives fair value gains (losses) 936 604 348 2,215 

Mortgage commitment derivatives 125 880 45 2,719 

CRT-related derivatives(2) (68) 66 (144) 78 

Other (64) (42) (3) (81) 

Total derivatives not designated as hedges fair value gains (losses) $929 $1,508 $246 $4,931 

(1) Accrual of periodic cash settlements on swaps is included in the respective gain (loss) of the derivative and is no longer presented separately. Certain prior period 

amounts have been reclassified to conform to the current period presentation.

(2) Includes derivative instruments related to CRT transactions that are considered freestanding credit enhancements. 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 8 

Freddie Mac 2Q 2023 Form 10-Q 75
Fair Value Hedges 

The table below presents the effects of fair value hedge accounting by condensed 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 8.3 - Gains and Losses on Fair Value Hedges

2Q 2023 2Q 2022

(In millions) Interest Income Interest Expense Interest Income Interest Expense 

Total amounts of income and expense line items presented in 

our condensed consolidated statements of income in which the 

effects of fair value hedges are recorded: $25,755 ($21,232) $20,008 ($15,249) 

Interest contracts on mortgage loans held-for-investment:

Gain (loss) on fair value hedging relationships:

Hedged items (964) — (1,523) — 

Derivatives designated as hedging instruments 900 — 1,408 — 

Interest accruals on hedging instruments 251 — (149) — 

Discontinued hedge related basis adjustments amortization 39 — (4) — 

Interest contracts on debt:

Gain (loss) on fair value hedging relationships:

Hedged items — 725 — 1,300 

Derivatives designated as hedging instruments — (749) — (1,328) 

Interest accruals on hedging instruments — (1,000) — (44) 

Discontinued hedge related basis adjustment amortization — (172) — 2 

YTD 2023 YTD 2022

(In millions) Interest Income Interest Expense Interest Income Interest Expense

Total amounts of income and expense line items presented in 

our condensed consolidated statements of income in which the 

effects of fair value hedges are recorded: $50,742 ($41,718) $37,748 ($28,885) 

Interest contracts on mortgage loans held-for-investment:

Gain (loss) on fair value hedging relationships:

Hedged items 159 — (4,150) — 

Derivatives designated as hedging instruments (173) — 3,463 — 

Interest accruals on hedging instruments 462 — (416) — 

Discontinued hedge related basis adjustments amortization 70 — (128) — 

Interest contracts on debt:

Gain (loss) on fair value hedging relationships:

Hedged items — (810) — 5,161 

Derivatives designated as hedging instruments — 785 — (5,224) 

Interest accruals on hedging instruments — (2,051) — 100 

Discontinued hedge related basis adjustment amortization — (210) — 12 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 8 

Freddie Mac 2Q 2023 Form 10-Q 76
The table below presents the cumulative basis adjustments and the carrying amounts of the hedged item by its respective 

balance sheet line item.

Table 8.4 - Cumulative Basis Adjustments Due to Fair Value Hedging

June 30, 2023

Carrying 

Amount 

Assets / 

(Liabilities)

Cumulative Amount of Fair Value Hedging Basis 

Adjustment Included in the Carrying Amount

Closed Portfolio Under the 

Portfolio Layer Method

(In millions) Total

Under the 

Portfolio Layer 

Method

Discontinued - 

Hedge Related

Total Amount 

by Amortized 

Cost Basis

Designated 

Amount by 

UPB

Mortgage loans held-for-investment $1,127,522 ($2,893) ($322) ($2,571) $63,283 $11,670 

Mortgage loans held-for-sale 54 1 — 1 — — 

Debt (156,961) 8,265 — 193 — — 

December 31, 2022

Carrying 

Amount 

Assets / 

(Liabilities)

Cumulative Amount of Fair Value Hedging Basis 

Adjustment Included in the Carrying Amount

Closed Portfolio Under the 

Portfolio Layer Method

(In millions) Total

Under the 

Portfolio Layer 

Method

Discontinued - 

Hedge Related

Total Amount 

by Amortized 

Cost Basis

Designated 

Amount by 

UPB

Mortgage loans held-for-investment $1,108,098 ($3,122) ($959) ($2,163) $79,070 $11,516 

Mortgage loans held-for-sale 67 1 — 1 — — 

Debt (142,511) 9,384 — 123 — — 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 8 

Freddie Mac 2Q 2023 Form 10-Q 77
NOTE 9

Collateralized Agreements and Offsetting Arrangements

Offsetting of Financial Assets and Liabilities

The table below presents offsetting and collateral information related to derivatives, securities purchased under agreements to 

resell, and securities sold under agreements to repurchase which are subject to enforceable master netting agreements or 

similar arrangements.

Table 9.1 - Offsetting and Collateral Information of Financial Assets and Liabilities

June 30, 2023

Gross

Amount

Recognized

Amount 

Offset in the Condensed

Consolidated

Balance Sheets

Net Amount

Presented in the 

Condensed 

Consolidated

Balance Sheets

Gross Amount

Not Offset in the 

Condensed  

Consolidated

Balance 

Sheets(2)

Net

(In millions) Amount

Counterparty 

Netting

Cash 

Collateral 

Netting(1)

Assets:

Derivatives:

OTC derivatives $5,652 ($4,229) ($1,112) $311 ($281) $30 

Cleared and exchange-traded derivatives 2 — 27 29 — 29 

Mortgage commitment derivatives 6 — — 6 — 6 

Other 13 — — 13 — 13 

Total derivatives 5,673 (4,229) (1,085) 359 (281) 78 

Securities purchased under agreements to resell 121,554 (9,168) — 112,386 (112,386) — 

Total $127,227 ($13,397) ($1,085) $112,745 ($112,667) $78 

Liabilities:

Derivatives:

OTC derivatives ($9,826) $4,229 $5,434 ($163) $104 ($59) 

Cleared and exchange-traded derivatives (68) — 35 (33) 33 — 

Mortgage commitment derivatives (55) — — (55) — (55) 

Other (730) — — (730) — (730) 

Total derivatives (10,679) 4,229 5,469 (981) 137 (844) 

Securities sold under agreements to repurchase (9,168) 9,168 — — — — 

Total ($19,847) $13,397 $5,469 ($981) $137 ($844) 

 Referenced footnotes are included after the prior period table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

Freddie Mac 2Q 2023 Form 10-Q 78
December 31, 2022

Gross

Amount

Recognized

Amount 

Offset in the Condensed

Consolidated

Balance Sheets Net Amount

Presented in the 

Condensed 

Consolidated

Balance Sheets

Gross Amount

Not Offset in the 

Condensed  

Consolidated

Balance 

Sheets(2)

Net

(In millions) Amount

Counterparty 

Netting

Cash 

Collateral 

Netting(1)

Assets:

Derivatives:

OTC derivatives $6,385 ($4,468) ($1,681) $236 ($214) $22 

Cleared and exchange-traded derivatives 28 — 22 50 — 50 

Mortgage commitment derivatives 19 — — 19 (4) 15 

Other 2 — — 2 — 2 

Total derivatives 6,434 (4,468) (1,659) 307 (218) 89 

Securities purchased under agreements to resell 99,286 (11,991) — 87,295 (87,295) — 

Total $105,720 ($16,459) ($1,659) $87,602 ($87,513) $89 

Liabilities:

Derivatives:

OTC derivatives ($10,230) $4,468 $5,702 ($60) $23 ($37) 

Cleared and exchange-traded derivatives (25) — 17 (8) 8 — 

Mortgage commitment derivatives (11) — — (11) — (11) 

Other (679) — — (679) — (679) 

Total derivatives (10,945) 4,468 5,719 (758) 31 (727) 

Securities sold under agreements to repurchase (11,991) 11,991 — — — — 

Total ($22,936) $16,459 $5,719 ($758) $31 ($727) 

(1) Excess cash collateral held is presented as a derivative liability, while excess cash collateral posted is presented as a derivative asset.

(2) Does not include the fair value amount of non-cash collateral posted or held that exceeds the associated net asset or liability, netted by counterparty, presented on 

the condensed consolidated balance sheets. For securities purchased under agreements to resell, includes $119.9 billion and $54.7 billion of collateral that we had 

the right to repledge as of June 30, 2023 and December 31, 2022, respectively. We repledged less than $0.1 billion of collateral as of both June 30, 2023 and 

December 31, 2022.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

Freddie Mac 2Q 2023 Form 10-Q 79
Collateral Pledged

The table below summarizes the carrying value of the collateral pledged by us and recorded on our condensed consolidated 

balance sheets for derivatives and collateralized borrowing transactions, including securities that the secured party may 

repledge.

Table 9.2 - Collateral in the Form of Securities Pledged 

June 30, 2023

(In millions) Derivatives

Securities Sold 

Under 

Agreements to 

Repurchase Other(1) Total

Trading securities $2,048 $7,598 $3,112 $12,758 

Total securities pledged $2,048 $7,598 $3,112 $12,758 

December 31, 2022

(In millions) Derivatives

Securities Sold 

Under 

Agreements to 

Repurchase Other(1) Total

Trading securities $1,533 $2,910 $1,347 $5,790 

Other assets — 6,543 — 6,543 

Total securities pledged $1,533 $9,453 $1,347 $12,333 

(1) Includes other collateralized borrowings and collateral related to transactions with certain clearinghouses.

The table below presents the remaining contractual maturity of our gross obligations for securities sold under agreements to 

repurchase. The collateral for such obligations consisted primarily of U.S. Treasury securities.

Table 9.3 - Remaining Contractual Maturity

June 30, 2023

(In millions)

Overnight and 

Continuous 30 Days or Less

After 30 Days 

Through 90 Days

Greater Than 90 

Days Total

Securities sold under agreements to repurchase $— $5,562 $3,606 $— $9,168 

December 31, 2022

(In millions)

Overnight and 

Continuous 30 Days or Less

After 30 Days 

Through 90 Days

Greater Than 90 

Days Total

Securities sold under agreements to repurchase $— $11,991 $— $— $11,991 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

Freddie Mac 2Q 2023 Form 10-Q 80
NOTE 10

Net Interest Income

The table below presents the components of net interest income per our condensed consolidated statements of income and 

comprehensive income.

Table 10.1 - Components of Net Interest Income

(In millions) 2Q 2023 2Q 2022 YTD 2023 YTD 2022

Interest income:

Mortgage loans $23,598 $19,324 $46,902 $36,634 

Investment securities 363 464 679 848 

Other 1,794 220 3,161 266 

Total interest income 25,755 20,008 50,742 37,748 

Interest expense:

Debt of consolidated trusts (18,608) (14,595) (36,869) (27,844) 

Debt of Freddie Mac:

Short-term debt (248) (20) (402) (20) 

Long-term debt (2,376) (634) (4,447) (1,021) 

Total interest expense (21,232) (15,249) (41,718) (28,885) 

Net interest income 4,523 4,759 9,024 8,863 

(Provision) benefit for credit losses 537 (307) 142 530 

Net interest income after (provision) benefit for credit losses $5,060 $4,452 $9,166 $9,393 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 10

Freddie Mac 2Q 2023 Form 10-Q 81
NOTE 11

Segment Reporting

As shown in the table below, we have two reportable segments, Single-Family and Multifamily. 

Segment Description

Single-Family 

Reflects results from our purchase, securitization, and guarantee of single-family loans, our investments in single-family 

loans and mortgage-related securities, the management of Single-Family mortgage credit risk and market risk, and any 

results of our treasury function that are not allocated to each segment.

Multifamily Reflects results from our purchase, securitization, and guarantee of multifamily loans, our investments in multifamily loans 

and mortgage-related securities, and the management of Multifamily mortgage credit risk and market risk.

Segment Results

The table below presents the financial results for our Single-Family and Multifamily segments.

Table 11.1 - Segment Financial Results

2Q 2023 2Q 2022

(In millions) Single-Family Multifamily Total Single-Family Multifamily Total

Net interest income $4,295 $228 $4,523 $4,535 $224 $4,759 

Non-interest income 

Guarantee income 16 293 309 35 170 205 

Investment gains, net (4) 415 411 232 89 321 

Other income 53 43 96 69 50 119 

Non-interest income 65 751 816 336 309 645 

Net revenues 4,360 979 5,339 4,871 533 5,404 

(Provision) benefit for credit losses 638 (101) 537 (298) (9) (307) 

Non-interest expense (2,028) (176) (2,204) (1,854) (166) (2,020) 

Income before income tax expense 2,970 702 3,672 2,719 358 3,077 

Income tax expense (589) (139) (728) (551) (73) (624) 

Net income 2,381 563 2,944 2,168 285 2,453 

Other comprehensive income (loss), net 

of taxes and reclassification adjustments 2 (56) (54) 5 (71) (66) 

Comprehensive income $2,383 $507 $2,890 $2,173 $214 $2,387 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 11

Freddie Mac 2Q 2023 Form 10-Q 82
YTD 2023 YTD 2022

(In millions) Single-Family Multifamily Total Single-Family Multifamily Total

Net interest income $8,591 $433 $9,024 $8,341 $522 $8,863 

Non-interest income 

Guarantee income 48 727 775 65 210 275 

Investment gains, net (183) 369 186 1,484 350 1,834 

Other income 107 74 181 195 83 278 

Non-interest income (28) 1,170 1,142 1,744 643 2,387 

Net revenues 8,563 1,603 10,166 10,085 1,165 11,250 

(Provision) benefit for credit losses 320 (178) 142 533 (3) 530 

Non-interest expense (3,811) (325) (4,136) (3,632) (320) (3,952) 

Income before income tax expense 5,072 1,100 6,172 6,986 842 7,828 

Income tax expense (1,014) (219) (1,233) (1,407) (170) (1,577) 

Net income 4,058 881 4,939 5,579 672 6,251 

Other comprehensive income (loss), net of 

taxes and reclassification adjustments 1 (1) — (7) (179) (186) 

Comprehensive income $4,059 $880 $4,939 $5,572 $493 $6,065 

The table below presents total assets for our Single-Family and Multifamily segments.

Table 11.2 - Segment Assets

(In millions) June 30, 2023 December 31, 2022

Single-Family $3,004,244 $2,986,045 

Multifamily 427,198 429,302 

Total segment assets 3,431,442 3,415,347 

Reconciling items(1) (180,486) (207,014) 

Total assets per condensed consolidated balance sheets $3,250,956 $3,208,333 

(1) Reconciling items include assets in our mortgage portfolio that are not recognized on our condensed consolidated balance sheets and assets recognized on our 

condensed consolidated balance sheets that are not allocated to the reportable segments. 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 11

Freddie Mac 2Q 2023 Form 10-Q 83
NOTE 12

Concentration of Credit and Other Risks

Single-Family Mortgage Portfolio

The table below summarizes the concentration by geographic area of our Single-Family mortgage portfolio. See Note 2, Note 

3, and Note 5 for more information about credit risk associated with single-family loans that we hold or guarantee.

Table 12.1 - Concentration of Credit Risk of Our Single-Family Mortgage Portfolio

June 30, 2023 December 31, 2022

(Dollars in millions) Portfolio UPB(1) % of Portfolio SDQ Rate Portfolio UPB(1) % of Portfolio SDQ Rate

Region:(2)

West $907,973 30 % 0.43 % $906,123 30 % 0.49 %

Northeast 695,851 23 0.70 695,944 23 0.82 

North Central 436,738 15 0.55 436,294 15 0.65 

Southeast 520,570 17 0.59 512,495 17 0.73 

Southwest 442,846 15 0.53 434,907 15 0.63 

Total $3,003,978 100 % 0.56 $2,985,763 100 % 0.66 

State:

California $515,634 17 % 0.44 $516,891 17 % 0.51 

Texas 206,944 7 0.55 200,807 7 0.64 

Florida 195,485 7 0.67 191,009 6 0.84 

New York 130,089 4 1.03 129,935 4 1.16 

Illinois 112,581 4 0.73 112,784 4 0.90 

All other 1,843,245 61 0.53 1,834,337 62 0.63 

Total $3,003,978 100 % 0.56 $2,985,763 100 % 0.66 

(1) Excludes UPB of loans underlying certain securitization products for which data was not available.

(2) Region designation: West (AK, AZ, CA, GU, HI, ID, MT, NV, OR, UT, WA); Northeast (CT, DE, DC, MA, ME, MD, NH, NJ, NY, PA, RI, VT, VA, WV); North Central (IL, IN, IA, 

MI, MN, ND, OH, SD, WI); Southeast (AL, FL, GA, KY, MS, NC, PR, SC, TN, VI); Southwest (AR, CO, KS, LA, MO, NE, NM, OK, TX, WY).

Multifamily Mortgage Portfolio

The table below summarizes the concentration by geographic area of our Multifamily mortgage portfolio. See Note 2, Note 3, 

Note 4, and Note 5 for more information about credit risk associated with multifamily loans that we hold or guarantee.

Table 12.2 - Concentration of Credit Risk of Our Multifamily Mortgage Portfolio 

June 30, 2023 December 31, 2022

(Dollars in millions) Portfolio UPB % of Portfolio Delinquency Rate(1) Portfolio UPB % of Portfolio Delinquency Rate(1)

Region(2)(3):

 West $107,717 25 % 0.05 % $107,260 25 % 0.04 %

 Northeast 103,742 24 0.51 106,478 25 0.28 

 North Central 40,713 10 0.37 40,524 9 0.16 

 Southeast 85,067 20 0.07 85,438 20 0.04 

 Southwest 89,959 21 0.13 89,602 21 0.08 

Total $427,198 100 % 0.21 $429,302 100 % 0.12 

(1) Based on loans two monthly payments or more delinquent or in foreclosure.

(2) Region designation: West (AK, AZ, CA, GU, HI, ID, MT, NV, OR, UT, WA); Northeast (CT, DE, DC, MA, ME, MD, NH, NJ, NY, PA, RI, VT, VA, WV); North Central (IL, IN, IA, 

MI, MN, ND, OH, SD, WI); Southeast (AL, FL, GA, KY, MS, NC, PR, SC, TN, VI); Southwest (AR, CO, KS, LA, MO, NE, NM, OK, TX, WY). 

(3) The UPB of loans collateralized by properties located in multiple regions are reported entirely in the region with the largest underlying collateral UPB as of origination.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 12

Freddie Mac 2Q 2023 Form 10-Q 84
NOTE 13

Fair Value Disclosures

We use fair value measurements for the initial recording of certain assets and liabilities and periodic remeasurement of certain 

assets and liabilities on a recurring or non-recurring basis.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The table below presents our assets and liabilities measured on our condensed consolidated balance sheets at fair value on a 

recurring basis subsequent to initial recognition, including instruments where we have elected the fair value option.

Table 13.1 - Assets and Liabilities Measured at Fair Value on a Recurring Basis 

June 30, 2023

(In millions) Level 1 Level 2 Level 3

Netting 

Adjustments(1) Total

Assets:

Investment securities:

Available-for-sale $— $5,152 $790 $— $5,942 

Trading:

Mortgage-related securities — 7,695 2,561 — 10,256 

Non-mortgage-related securities 24,939 492 — — 25,431 

Total trading securities 24,939 8,187 2,561 — 35,687 

Total investment securities 24,939 13,339 3,351 — 41,629 

Mortgage loans held-for-sale — 4,831 881 — 5,712 

Mortgage loans held-for-investment — 1,189 170 — 1,359 

Other assets:

 Guarantee assets — — 5,323 — 5,323 

 Derivative assets, net — 5,609 12 (5,262) 359 

 Other assets — 11 147 — 158 

 Total other assets — 5,620 5,482 (5,262) 5,840 

Total assets carried at fair value on a recurring basis $24,939 $24,979 $9,884 ($5,262) $54,540 

Liabilities:

Debt:

Debt of consolidated trusts $— $1,069 $282 $— $1,351 

Debt of Freddie Mac — 552 92 — 644 

Total debt — 1,621 374 — 1,995 

Other liabilities:

Derivative liabilities, net 3 10,486 90 (9,598) 981 

Other liabilities — 27 9 — 36 

 Total other liabilities 3 10,513 99 (9,598) 1,017 

Total liabilities carried at fair value on a recurring basis $3 $12,134 $473 ($9,598) $3,012 

Referenced footnote is included after the prior period table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 85
December 31, 2022

(In millions) Level 1 Level 2 Level 3

Netting 

Adjustments(1) Total

Assets:

Investment securities:

Available-for-sale $— $5,640 $894 $— $6,534 

Trading:

Mortgage-related securities — 5,603 2,731 — 8,334 

Non-mortgage-related securities 23,453 380 — — 23,833 

Total trading securities 23,453 5,983 2,731 — 32,167 

Total investment securities 23,453 11,623 3,625 — 38,701 

Mortgage loans held-for-sale — 2,908 310 — 3,218 

Mortgage loans held-for-investment — 1,104 110 — 1,214 

Other assets:

 Guarantee assets — — 5,442 — 5,442 

 Derivative assets, net — 6,397 2 (6,092) 307 

 Other assets — 12 129 — 141 

 Total other assets — 6,409 5,573 (6,092) 5,890 

Total assets carried at fair value on a recurring basis $23,453 $22,044 $9,618 ($6,092) $49,023 

Liabilities:

Debt:

Debt of consolidated trusts $— $1,656 $288 $— $1,944 

 Debt of Freddie Mac — 1,003 100 — 1,103 

Total debt — 2,659 388 — 3,047 

Other liabilities:

 Derivative liabilities, net — 10,823 97 (10,162) 758 

 Other liabilities — 1 — — 1 

 Total other liabilities — 10,824 97 (10,162) 759 

 Total liabilities carried at fair value on a recurring basis $— $13,483 $485 ($10,162) $3,806 

(1) Represents counterparty netting and cash collateral netting.

Level 3 Fair Value Measurements

The table below presents a reconciliation of all assets and liabilities measured on our condensed consolidated balance sheets 

at fair value on a recurring basis using significant unobservable inputs (Level 3), including transfers into and out of Level 3. The 

table also presents gains and losses due to changes in fair value, including both realized and unrealized gains and losses, 

recognized on our condensed consolidated statements of income for Level 3 assets and liabilities.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 86
Table 13.2 - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs 

2Q 2023

Balance,

April 1,

2023

Total Realized/Unrealized 

Gains (Losses)(1)

Purchases Issues Sales

Settlements,

Net

Transfers

into

Level 3

Transfers

out of

Level 3

Balance,

June 30,

2023

Change in 

Unrealized 

Gains/Losses(1)

Included in Net 

Income 

Related to 

Assets and 

Liabilities Still 

Held as of June 

30, 2023(2)

Change in 

Unrealized 

Gains/Losses(1), 

Net of Tax, 

Included in OCI 

Related to 

Assets and 

Liabilities Still 

Held as of June 

(In millions) 30, 2023

Included 

in

Earnings

Included in 

Other

Comprehensive

Income

Assets

Investment securities:

Available-for-sale $853 $— ($5) $— $— $— ($58) $— $— $790 $— ($4) 

Trading 2,905 (191) — 90 — — (13) — (230) 2,561 (25) — 

Total investment 

securities 3,758 (191) (5) 90 — — (71) — (230) 3,351 (25) (4) 

Mortgage loans held-forsale 347 (30) — 727 — — (9) — (154) 881 (31) — 

Mortgage loans held-forinvestment 64 (13) — — — — (6) 142 (17) 170 (12) — 

Other assets:

Guarantee assets 5,432 (79) — — 192 — (222) — — 5,323 (79) — 

Other assets 128 39 — (8) 4 — (4) — — 159 38 — 

Total other assets 5,560 (40) — (8) 196 — (226) — — 5,482 (41) — 

Total assets $9,729 ($274) ($5) $809 $196 $— ($312) $142 ($401) $9,884 ($109) ($4) 

Liabilities

Debt $384 ($8) $— $— $— $— ($2) $— $— $374 ($2) $— 

Other liabilities 77 23 — — — — (1) — — 99 22 — 

Total liabilities $461 $15 $— $— $— $— ($3) $— $— $473 $20 $— 

YTD 2023

Balance,

January 1,

2023

Total Realized/Unrealized 

Gains (Losses)(1)

Purchases Issues Sales

Settlements,

Net

Transfers

into

Level 3

Transfers

out of

Level 3

Balance,

June 30,

2023

Change in 

Unrealized 

Gains/Losses(1)

Included in Net 

Income 

Related to 

Assets and 

Liabilities Still 

Held as of June 

30, 2023(2)

Change in 

Unrealized 

Gains/Losses(1), 

Net of Tax, 

Included in OCI 

Related to 

Assets and 

Liabilities Still 

Held as of June 

(In millions) 30, 2023

Included 

in

Earnings

Included in 

Other

Comprehensive

Income

Assets

Investment securities:

Available-for-sale $894 $1 ($9) $— $— $— ($96) $— $— $790 $— ($7) 

Trading 2,731 (329) — 183 — — (24) — — 2,561 10 — 

Total investment 

securities 3,625 (328) (9) 183 — — (120) — — 3,351 10 (7) 

Mortgage loans held-forsale 310 (29) — 753 — — (11) 12 (154) 881 (31) — 

Mortgage loans held-forinvestment 110 (11) — — — — (6) 142 (65) 170 (12) — 

Other assets:

Guarantee assets 5,442 8 — — 318 — (445) — — 5,323 8 — 

Other assets 131 55 — (18) 3 — (12) — — 159 54 — 

Total other assets 5,573 63 — (18) 321 — (457) — — 5,482 62 — 

Total assets $9,618 ($305) ($9) $918 $321 $— ($594) $154 ($219) $9,884 $29 ($7) 

Liabilities

Debt $388 ($19) $— $— $11 $— ($6) $— $— $374 ($9) $— 

Other liabilities 97 4 — — — — (2) — — 99 2 — 

Total liabilities $485 ($15) $— $— $11 $— ($8) $— $— $473 ($7) $— 

Referenced footnote is included after the prior period table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 87
2Q 2022

Balance,

April 1,

2022

Total Realized/Unrealized 

Gains (Losses)(1)

Purchases Issues Sales

Settlements,

Net

Transfers

into

Level 3

Transfers

out of

Level 3

Balance,

June 30,

2022

Change in 

Unrealized 

Gains/Losses(1)

Included in Net 

Income 

Related to 

Assets and 

Liabilities Still 

Held as of June 

30, 2022(2)

Change in 

Unrealized 

Gains/Losses(1), 

Net of Tax, 

Included in OCI 

Related to 

Assets and 

Liabilities Still 

Held as of June 

(In millions) 30, 2022

Included 

in

Earnings

Included in 

Other

Comprehensive

Income

Assets

Investment securities:

Available-for-sale $1,188 $— ($7) $43 $— ($1) ($99) $— $— $1,124 $— ($5) 

Trading 3,165 (232) — 436 — — (15) — (35) 3,319 (57) — 

Total investment 

securities 4,353 (232) (7) 479 — (1) (114) — (35) 4,443 (57) (5) 

Mortgage loans held-forsale — (14) — — — (5) (25) 383 — 339 (14) — 

Other assets:

Guarantee assets 5,696 (194) — — 376 — (229) — — 5,649 (194) — 

Other assets 114 33 — (6) 5 (5) (9) — — 132 33 — 

Total other assets 5,810 (161) — (6) 381 (5) (238) — — 5,781 (161) — 

Total assets $10,163 ($407) ($7) $473 $381 ($11) ($377) $383 ($35) $10,563 ($232) ($5) 

Liabilities

Debt $402 $12 $— ($6) $55 $— ($6) $— $— $457 $23 $— 

Other liabilities 47 14 — — — — (3) — — 58 13 — 

Total liabilities $449 $26 $— ($6) $55 $— ($9) $— $— $515 $36 $— 

YTD 2022

Balance,

January 1,

2022

Total Realized/Unrealized 

Gains (Losses)(1)

Purchases Issues Sales

Settlements,

Net

Transfers

into

Level 3

Transfers

out of

Level 3

Balance,

June 30,

2022

Change in 

Unrealized 

Gains/Losses(1)

Included in Net 

Income 

Related to 

Assets and 

Liabilities Still 

Held as of June 

30, 2022(2)

Change in 

Unrealized 

Gains/Losses(1), 

Net of Tax, 

Included in OCI 

Related to 

Assets and 

Liabilities Still 

Held as of June 

(In millions) 30, 2022

Included 

in

Earnings

Included in 

Other

Comprehensive

Income

Assets

Investment securities:

Available-for-sale $1,286 $— ($43) $43 $— ($1) ($191) $30 $— $1,124 ($1) ($33) 

Trading 3,386 (658) — 644 — — (33) — (20) 3,319 (312) — 

Total investment 

securities 4,672 (658) (43) 687 — (1) (224) 30 (20) 4,443 (313) (33) 

Mortgage loans heldfor-sale — (14) — — — (5) (25) 383 — 339 (14) — 

Other assets: — 

Guarantee assets 5,919 (510) — — 708 — (468) — — 5,649 (510) — 

Other assets 101 47 — (9) 9 (5) (11) — — 132 48 — 

Total other assets 6,020 (463) — (9) 717 (5) (479) — — 5,781 (462) — 

Total assets $10,692 ($1,135) ($43) $678 $717 ($11) ($728) $413 ($20) $10,563 ($789) ($33) 

Liabilities

Debt $294 $35 $— ($6) $141 $— ($7) $— $— $457 $56 $— 

Other liabilities 24 37 — 1 — — (4) — — 58 35 — 

Total liabilities $318 $72 $— ($5) $141 $— ($11) $— $— $515 $91 $— 

(1) For assets, increase and decrease in earnings and other comprehensive income is shown as gains and (losses), respectively. For liabilities, increase and decrease in 

earnings and comprehensive income is shown as (gains) and losses, respectively.

(2) Represents the amount of total gains or losses for the period, included in earnings, attributable to the change in unrealized gains and losses related to assets and 

liabilities classified as Level 3 that were still held at June 30, 2023 and June 30, 2022. 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 88
The table below provides valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 

3 assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis.

Table 13.3 - Quantitative Information about Recurring Level 3 Fair Value Measurements 

June 30, 2023

Level 3

Fair

Value

Predominant

Valuation

Technique(s)

Unobservable Inputs

(Dollars in millions, except for certain unobservable 

inputs as shown) Type Range

Weighted

Average(1)

Assets

Investment securities:

 Available-for-sale $510 Median of external sources External pricing sources $57.9 - $71.9 $67.1 

 280 Other

 Trading 1,944 Single external source External pricing source $0.0 - $5,007.3 $183.8 

 617 Other

Mortgage loans held-for-sale 881 Single external source External pricing source $46.7 - $100.2 $91.9 

Mortgage loans held-for-investment 170 Single external source External pricing source $29.4 - $97.8 $74.8 

Guarantee assets 4,981 Discounted cash flows OAS 17 - 233 bps 46 bps

 342 Other

Insignificant Level 3 assets(2) 159 

Total level 3 assets $9,884 

Liabilities

Insignificant Level 3 liabilities(2) 473 

Total level 3 liabilities $473 

December 31, 2022

Level 3

Fair

Value

Predominant

Valuation

Technique(s)

Unobservable Inputs

(Dollars in millions, except for certain unobservable 

inputs as shown)

Type Range

Weighted

Average(1)

Assets

Investment securities:

 Available-for-sale $557 Median of external sources External pricing sources $66.3 - $74.6 $70.5 

 337 Other

 Trading 2,080 Single external source External pricing source $0.0 - $5,702.4 $224.8 

 651 Other

Mortgage loans held-for-sale 310 Single external source External pricing source $39.6 - $98.1 $76.6 

Mortgage loans held-for-investment 110 Single external source External pricing source $76.9 - $87.5 $80.6 

 Guarantee assets 5,084 Discounted cash flows OAS 17 - 186 bps 45 bps

 358 Other

 Insignificant Level 3 assets(2) 131 

Total level 3 assets $9,618 

Liabilities

Insignificant Level 3 liabilities(2) 485 

Total level 3 liabilities $485 

(1) Unobservable inputs were weighted primarily by the relative fair value of the financial instruments.

(2) Represents the aggregate amount of Level 3 assets and liabilities measured at fair value on a recurring basis that are individually and in the aggregate insignificant.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 89
Assets Measured at Fair Value on a Non-Recurring Basis

We may be required, from time to time, to measure certain assets at fair value on a non-recurring basis. These adjustments 

usually result from the application of lower-of-cost-or-fair-value accounting or measurement of impairment based on the fair 

value of the underlying collateral. Certain fair values in the tables below were not obtained as of period end, but were obtained 

during the period.

The table below presents assets measured on our condensed consolidated balance sheets at fair value on a non-recurring 

basis. 

Table 13.4 - Assets Measured at Fair Value on a Non-Recurring Basis 

June 30, 2023 December 31, 2022

(In millions) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

Mortgage loans(1) $— $326 $1,935 $2,261 $— $386 $1,758 $2,144 

(1) Includes loans that are classified as held-for-investment and have an allowance for credit losses based on the fair value of the underlying collateral and held-for-sale 

loans where the fair value is below cost.

The table below provides valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 

3 assets measured on our condensed consolidated balance sheets at fair value on a non-recurring basis.

Table 13.5 - Quantitative Information About Non-Recurring Level 3 Fair Value Measurements 

June 30, 2023

Level 3

Fair

Value

Predominant

Valuation

Technique(s)

Unobservable Inputs

(Dollars in millions, except for 

unobservable inputs as shown) Type Range

Weighted

Average(1)

Mortgage loans $1,568 Median of external sources External pricing sources $73.7 - $96.2 $83.6

367 Other

Total $1,935 

December 31, 2022

Level 3

Fair

Value

Predominant

Valuation

Technique(s)

Unobservable Inputs

(Dollars in millions, except for 

unobservable inputs as shown) Type Range

Weighted

Average(1)

Mortgage loans $1,657 Median of external sources External pricing sources $74.8 - $98.6 $86.3

101 Other

Total $1,758 

(1) Unobservable inputs were weighted primarily by the relative fair value of the financial instruments.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 90
Fair Value of Financial Instruments

The table below presents the carrying value and estimated fair value of our financial instruments. For certain types of financial 

instruments, such as cash and cash equivalents, securities purchased under agreements to resell, and certain debt, the 

carrying value on our condensed consolidated balance sheets approximates fair value, as these assets and liabilities are shortterm in nature and have limited fair value volatility. 

Table 13.6 - Fair Value of Financial Instruments

June 30, 2023

GAAP 

Measurement 

Category(1)

Carrying  

Amount

Fair Value

(In millions) Level 1 Level 2 Level 3

Netting 

Adjustments(2) Total

Financial Assets

Cash and cash equivalents Amortized cost $5,514 $5,514 $— $— $— $5,514 

Securities purchased under agreements 

to resell Amortized cost 112,386 — 121,554 — (9,168) 112,386 

Investment securities:

Available-for-sale FV - OCI 5,942 — 5,152 790 — 5,942 

Trading FV - NI 35,687 24,939 8,187 2,561 — 35,687 

Total investment securities 41,629 24,939 13,339 3,351 — 41,629 

Mortgage loans:

Loans held by consolidated trusts 2,995,770 — 2,366,320 231,946 — 2,598,266 

Loans held by Freddie Mac 58,851 — 24,409 29,565 — 53,974 

Total mortgage loans(3) Various(4) 3,054,621 — 2,390,729 261,511 — 2,652,240 

Other assets:

Guarantee assets FV - NI 5,323 — — 5,327 — 5,327 

Derivative assets, net FV - NI 359 — 5,609 12 (5,262) 359 

Other assets(5) Various 3,106 — 895 2,215 — 3,110 

 Total other assets 8,788 — 6,504 7,554 (5,262) 8,796 

Total financial assets $3,222,938 $30,453 $2,532,126 $272,416 ($14,430) $2,820,565 

Financial Liabilities

Debt:

Debt of consolidated trusts $3,007,278 $— $2,598,799 $677 $— $2,599,476 

Debt of Freddie Mac 181,808 — 188,053 3,316 (9,168) 182,201 

Total debt Various(6) 3,189,086 — 2,786,852 3,993 (9,168) 2,781,677 

Other liabilities:

Guarantee obligations Amortized cost 5,569 — 107 5,979 — 6,086 

Derivative liabilities, net FV - NI 981 3 10,486 90 (9,598) 981 

Other liabilities(5) FV - NI 56 — 794 218 — 1,012 

 Total other liabilities 6,606 3 11,387 6,287 (9,598) 8,079 

Total financial liabilities $3,195,692 $3 $2,798,239 $10,280 ($18,766) $2,789,756 

Referenced footnotes are included after the prior period table.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 91
December 31, 2022

GAAP 

Measurement 

Category(1)

Carrying  

Amount

Fair Value

(In millions) Level 1 Level 2 Level 3

Netting 

Adjustments(2) Total

Financial Assets

Cash and cash equivalents Amortized cost $6,360 $6,360 $— $— $— $6,360 

Securities purchased under agreements 

to resell Amortized cost 87,295 — 99,286 — (11,991) 87,295 

Investment securities:

Available-for-sale FV - OCI 6,534 — 5,640 894 — 6,534 

Trading FV - NI 32,167 23,453 5,983 2,731 — 32,167 

Total investment securities 38,701 23,453 11,623 3,625 — 38,701 

Mortgage loans:

Loans held by consolidated trusts 2,971,601 — 2,331,969 244,045 — 2,576,014 

Loans held by Freddie Mac 62,914 — 25,921 32,460 — 58,381 

Total mortgage loans Various(4) 3,034,515 — 2,357,890 276,505 — 2,634,395 

Other assets:

Guarantee assets FV - NI 5,442 — — 5,445 — 5,445 

Derivative assets, net FV - NI 307 — 6,397 2 (6,092) 307 

Other assets(5) Various 1,739 — 907 835 — 1,742 

 Total other assets 7,488 — 7,304 6,282 (6,092) 7,494 

Total financial assets $3,174,359 $29,813 $2,476,103 $286,412 ($18,083) $2,774,245 

Financial Liabilities

Debt:

Debt of consolidated trusts $2,979,070 $— $2,564,323 $701 $— $2,565,024 

Debt of Freddie Mac 166,762 — 175,673 3,162 (11,991) 166,844 

Total debt Various(6) 3,145,832 — 2,739,996 3,863 (11,991) 2,731,868 

Other liabilities:

Guarantee obligations Amortized cost 5,779 — — 6,016 — 6,016 

Derivative liabilities, net FV - NI 758 — 10,823 97 (10,162) 758 

Other liabilities(5) FV - NI 20 — 1,025 211 — 1,236 

 Total other liabilities 6,557 — 11,848 6,324 (10,162) 8,010 

Total financial liabilities $3,152,389 $— $2,751,844 $10,187 ($22,153) $2,739,878 

(1) FV - NI denotes fair value through net income. FV - OCI denotes fair value through other comprehensive income.

(2) Represents counterparty netting and cash collateral netting.

(3) Excludes basis adjustments maintained on a closed portfolio basis related to existing portfolio layer method hedge relationships as of June 30, 2023. See Note 3 for 

additional information on basis adjustments associated with closed portfolios during existing portfolio layer method hedges.

(4) The GAAP carrying amounts measured at amortized cost, lower-of-cost-or-fair-value, and FV - NI were $3.0 trillion, $6.0 billion, and $7.1 billion as of June 30, 

2023, respectively, and $3.0 trillion, $9.0 billion and $4.4 billion as of December 31, 2022, respectively.

(5) For other assets, includes advances to lenders, secured lending, and loan commitments. For other liabilities, includes loan commitments.

(6) The GAAP carrying amounts measured at amortized cost and FV - NI were $3.2 trillion and $2.0 billion as of June 30, 2023, respectively, and $3.1 trillion and 

$3.0 billion as of December 31, 2022, respectively.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 92
Fair Value Option

We elected the fair value option for certain mortgage loans and loan commitments and certain debt issuances.

The table below presents the fair value and UPB related to items for which we have elected the fair value option.

Table 13.7 - Difference between Fair Value and UPB for Certain Financial Instruments with Fair Value Option Elected(1)

June 30, 2023 December 31, 2022

(In millions) Fair value UPB Difference Fair value UPB Difference

Mortgage loans held-for-sale $5,712 $5,859 ($147) $3,218 $3,421 ($203) 

Mortgage loans held-for-investment 1,359 1,566 (207) 1,214 1,368 (154) 

Debt of Freddie Mac 445 441 4 892 881 11 

Debt of consolidated trusts 1,068 1,213 (145) 1,656 1,833 (177) 

Other assets (other liabilities) (26) N/A N/A 11 N/A N/A

(1) Excludes interest-only securities related to debt of consolidated trusts and debt of Freddie Mac with a fair value of $0.5 billion as of both June 30, 2023 and 

December 31, 2022.

Changes in Fair Value Under the Fair Value Option Election

The table below presents the changes in fair value related to items for which we have elected the fair value option. These 

amounts are included in investment gains, net, on our condensed consolidated statements of income.

Table 13.8 - Changes in Fair Value Under the Fair Value Option Election

2Q 2023 2Q 2022 YTD 2023 YTD 2022

(In millions) Gains (Losses) Gains (Losses) 

Mortgage loans held-for-sale ($127) ($273) ($123) ($949) 

Mortgage loans held-for-investment (30) — (4) — 

Debt of Freddie Mac 5 (15) 19 (26) 

Debt of consolidated trusts 35 171 — 243 

Other assets/other liabilities (1) (170) 54 (206) 

Changes in fair value attributable to instrument-specific credit risk were not material for the periods presented for assets or 

liabilities for which we elected the fair value option.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

Freddie Mac 2Q 2023 Form 10-Q 93
NOTE 14

Legal Contingencies

We are involved, directly or indirectly, in a variety of legal and regulatory proceedings arising from time to time in the ordinary 

course of business (including, among other things, contractual disputes, personal injury claims, employment-related litigation, 

and other legal proceedings incidental to our business) and in connection with the conservatorship and Purchase Agreement. 

We are frequently involved, directly or indirectly, in litigation involving mortgage foreclosures. From time to time, we are also 

involved in proceedings arising from our termination of a seller's or servicer's eligibility to sell loans to, and/or service loans for, 

us. In these cases, the former seller or servicer sometimes seeks damages against us for wrongful termination under a variety 

of legal theories. In addition, we are sometimes sued in connection with the origination or servicing of loans. These suits 

typically involve claims alleging wrongful actions of sellers and servicers. Our contracts with our sellers and servicers generally 

provide for indemnification of Freddie Mac against liability arising from sellers' and servicers' wrongful actions with respect to 

loans sold to or serviced for Freddie Mac.

Litigation claims and proceedings of all types are subject to many uncertainties (including appeals and procedural filings), and 

there can be no assurance as to the ultimate outcome of those actions (including the matters described below). In accordance 

with the accounting guidance for contingencies, we reserve for litigation claims and assessments asserted or threatened 

against us when a loss is probable (as defined in such guidance) and the amount of the loss can be reasonably estimated. The 

actual costs of resolving legal actions may be substantially higher or lower than the amounts accrued for those actions.

It is not possible for us to predict the actions the U.S. government (including Treasury and FHFA) might take in response to any 

ruling or finding in any of these lawsuits or any future lawsuits. However, it is possible that we could be adversely affected by 

these events, including, for example, by changes to the Purchase Agreement, or any resulting actual or perceived changes in 

the level of U.S. government support for our business. 

Putative Securities Class Action Lawsuit: Ohio Public Employees 

Retirement System vs. Freddie Mac, Syron, Et Al.

This putative securities class action lawsuit was filed against Freddie Mac and certain former officers on January 18, 2008 in the 

U.S. District Court for the Northern District of Ohio purportedly on behalf of a class of purchasers of Freddie Mac stock from 

August 1, 2006 through November 20, 2007. FHFA later intervened as Conservator, and the plaintiff amended its complaint on 

several occasions. The plaintiff alleged, among other things, that the defendants violated federal securities laws by making false 

and misleading statements concerning our business, risk management, and the procedures we put into place to protect the 

company from problems in the mortgage industry. The plaintiff seeks unspecified damages and interest, and reasonable costs 

and expenses, including attorney and expert fees.

In August 2018, the District Court denied the plaintiff's motion for class certification, and in January 2019, the Sixth Circuit 

denied plaintiff's petition for leave to appeal that decision. On September 17, 2020, the District Court granted a request from 

the plaintiff for summary judgment and entered final judgment in favor of Freddie Mac and the other defendants. On October 9, 

2020, the plaintiff filed a notice of appeal in the Sixth Circuit. On April 6, 2023, the Sixth Circuit reversed the District Court’s 

September 17, 2020 decision and remanded the case to the District Court for further proceedings. The District Court scheduled 

the trial to begin on October 21, 2024.

Litigation Concerning the Purchase Agreement in the U.S. District Court 

for the District of Columbia

In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations. This is a 

consolidated class action lawsuit filed by private individual and institutional investors (collectively, "Class Plaintiffs") against 

FHFA, Fannie Mae, and Freddie Mac. 

Fairholme Funds, Inc., et al. v. FHFA, et al. This is an individual plaintiffs’ lawsuit by certain institutional investors (“Individual 

Plaintiffs”) against FHFA, Fannie Mae, and Freddie Mac. 

Plaintiffs in each of the District of Columbia lawsuits filed an amended complaint on November 1, 2017 alleging claims for 

breach of contract, breach of the implied covenant of good faith and fair dealing, breach of fiduciary duties, and violation of 

Delaware and Virginia corporate law. Additionally, the Class Plaintiffs brought derivative claims against FHFA for breach of 

fiduciary duties and the Individual Plaintiffs brought claims under the Administrative Procedure Act. Both sets of claims are 

generally based on allegations that the net worth sweep dividend provisions of the senior preferred stock that were 

implemented pursuant to the August 2012 amendments nullified certain of the shareholders’ rights, including the rights to 

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 14

Freddie Mac 2Q 2023 Form 10-Q 94
receive dividends and a liquidation preference. On September 28, 2018, the District Court dismissed all of the claims except 

those for breach of the implied covenant of good faith and fair dealing. The cases were consolidated for trial. 

Court rulings have limited the Plaintiffs’ damages theories to those based on the decline in Freddie Mac’s and Fannie Mae’s 

share value immediately after the Third Amendment. The Plaintiffs have asserted losses based on the decline in value of 

Freddie Mac’s common and junior preferred stock from August 16 to August 17, 2012. During the trial in October and early 

November 2022, the Plaintiffs requested that the jury award $832 million plus pre-judgment interest as damages against 

Freddie Mac. The jury in that trial was not able to reach a unanimous verdict and on November 7, 2022 the judge declared a 

mistrial. The retrial started on July 24, 2023 and is ongoing as of the date hereof. At this time, we do not believe the likelihood of 

loss is probable; therefore, we have not established an accrual in connection with these lawsuits. However, it is reasonably 

possible that the Plaintiffs could prevail in this matter and, if so, we may incur a loss up to $832 million plus pre-judgment 

interest as discussed above. We estimate that pre-judgment interest, if awarded, would be calculated at a rate of 6%.

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 14

Freddie Mac 2Q 2023 Form 10-Q 95
NOTE 15

Regulatory Capital

ERCF 

The table below presents our capital metrics under the ERCF. 

Table 15.1 - ERCF Available Capital and Capital Requirements 

(In billions) June 30, 2023 December 31, 2022

Adjusted total assets $3,744 $3,710 

Risk-weighted assets (standardized approach) 929 899 

June 30, 2023

Amounts Ratios

(Dollars in billions)

Available 

Capital (Deficit)

Minimum 

Capital 

Requirement

Capital 

Requirement 

(Including Buffer(1))

Available 

Capital 

(Deficit) 

Ratio(2)

Minimum 

Capital 

Requirement 

Ratio(2)

Capital 

Requirement 

Ratio(2)

(Including 

Buffer(1))

Risk-based capital:

Total capital ($23) $74 $74 (2.4) % 8.0 % 8.0 %

CET1 capital (50) 42 93 (5.4) 4.5 9.9 

Tier 1 capital (36) 56 107 (3.9) 6.0 11.4 

Adjusted total capital (36) 74 125 (3.9) 8.0 13.4 

Leverage capital:

Core capital ($31) $94 $94 (0.8) % 2.5 % 2.5 %

Tier 1 capital (36) 94 105 (1.0) 2.5 2.8 

December 31, 2022

Amounts Ratios

(Dollars in billions)

Available 

Capital (Deficit)

Minimum 

Capital 

Requirement

Capital 

Requirement 

(Including Buffer(1))

Available 

Capital 

(Deficit) 

Ratio(2)

Minimum 

Capital 

Requirement 

Ratio(2)

Capital 

Requirement 

Ratio(2)

(Including 

Buffer(1))

Risk-based capital:

Total capital ($27) $72 $72 (3.1) % 8.0 % 8.0 %

CET1 capital (55) 40 90 (6.2) 4.5 10.1 

Tier 1 capital (41) 54 104 (4.6) 6.0 11.6 

Adjusted total capital (41) 72 122 (4.6) 8.0 13.6 

Leverage capital:

Core capital ($35) $93 $93 (1.0) % 2.5 % 2.5 %

Tier 1 capital (41) 93 104 (1.1) 2.5 2.8 

(1) PCCBA for risk-based capital and PLBA for leverage capital.

(2) As a percentage of RWA for risk-based capital and ATA for leverage capital.

END OF CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND ACCOMPANYING NOTES

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

Freddie Mac 2Q 2023 Form 10-Q 96
Other Information

LEGAL PROCEEDINGS 

We are involved, directly or indirectly, in a variety of legal proceedings arising from time to time in the ordinary course of 

business and in connection with the conservatorship and Purchase Agreement. See Note 14 for more information regarding 

our involvement as a party to various legal proceedings, including those in connection with the conservatorship and Purchase 

Agreement. 

Over the last several years, numerous lawsuits have been filed against the U.S. government and, in some cases, the Secretary 

of the Treasury and the Director of FHFA, challenging certain government actions related to the conservatorship (including 

actions taken in connection with the imposition of conservatorship) and the Purchase Agreement. Freddie Mac is not a party to 

all of these lawsuits. Several of the lawsuits seek to invalidate the net worth sweep dividend provisions of the senior preferred 

stock, which were implemented pursuant to the August 2012 amendment to the Purchase Agreement. Some of these cases 

also have challenged the constitutionality of the structure of FHFA. A number of cases have been dismissed (some of which 

have been appealed), and others remain pending. 

These cases include one that was filed in the U.S. Court of Federal Claims as a derivative lawsuit, purportedly on behalf of 

Freddie Mac as a “nominal” defendant: Reid and Fisher vs. the United States of America and Federal Home Loan Mortgage 

Corporation. This case was filed on February 26, 2014. The complaint alleges, among other items, that the net worth sweep 

dividend provisions of the senior preferred stock constitute an unlawful taking of private property for public use without just 

compensation. The plaintiffs ask that Freddie Mac be awarded just compensation for the U.S. government's alleged taking of 

its property, attorneys' fees, costs, and other expenses. The case remains pending.

Pursuant to the Purchase Agreement, in addition to satisfying other conditions, all currently pending material litigation related to 

our conservatorship and/or the Purchase Agreement must be resolved or settled and we must indemnify Treasury and the 

United States from and against any loss, cost, or damage of any kind arising out of our placement into conservatorship or the 

August 2012 amendment to the Purchase Agreement in order to exit from conservatorship. 

RISK FACTORS 

This Form 10-Q should be read together with the Risk Factors section in our 2022 Annual Report, which describe various 

risks and uncertainties to which we are or may become subject. These risks and uncertainties could, directly or indirectly, 

adversely affect our business, financial condition, results of operations, cash flows, strategies, and/or prospects.

UNREGISTERED SALES OF EQUITY SECURITIES AND 

USE OF PROCEEDS

Recent Sales of Unregistered Securities

The securities we issue are "exempted securities" under the Securities Act of 1933, as amended. As a result, we do not file 

registration statements with the SEC with respect to offerings of our securities.

Following our entry into conservatorship, we suspended the operation of, and ceased making grants under, equity 

compensation plans. Previously, we had provided equity compensation under those plans to employees and members of the 

Board of Directors. Under the Purchase Agreement, we cannot issue any new options, rights to purchase, participations, or 

other equity interests without Treasury's prior approval.

Information About Certain Securities Issuances by Freddie Mac

We make available, free of charge through our website at www.freddiemac.com, our annual reports on Form 10-K, quarterly 

reports on Form 10-Q, current reports on Form 8-K, and all other SEC reports and amendments to those reports as soon as 

reasonably practicable after we electronically file the material with the SEC. The SEC also maintains an internet site 

(www.sec.gov) that contains reports, proxy and information statements, and other information regarding companies that file 

electronically with the SEC. 

We provide disclosure about our debt securities on our website at www.freddiemac.com/debt. From this address, investors 

can access the offering circular and related supplements for debt securities offerings under Freddie Mac's global debt facility, 

Other Information

Freddie Mac 2Q 2023 Form 10-Q 97
including pricing supplements for individual issuances of debt securities. Similar information about our STACR transactions and 

SCR transactions is available at crt.freddiemac.com and mf.freddiemac.com/investors, respectively.

We provide disclosure about our mortgage-related securities, some of which are off-balance sheet obligations (e.g., K 

Certificates and SB Certificates), on our website at www.freddiemac.com/mbs and mf.freddiemac.com/investors. From 

these addresses, investors can access information and documents, including offering circulars and offering circular 

supplements, for mortgage-related securities offerings.

We provide additional information, including product descriptions, investor presentations, securities issuance calendars, 

transactions volumes and details, redemption notices, Freddie Mac research, and material developments or other events that 

may be important to investors, in each case as applicable, on the websites for our business activities, which can be found at 

sf.freddiemac.com, mf.freddiemac.com, and capitalmarkets.freddiemac.com/capital-markets.

We provide information on our ESG efforts on our website at freddiemac.com/about/esg.

OTHER INFORMATION

Amendments to Bylaws

Effective July 11, 2023, our Bylaws were amended to change the duration for which the complete list of stockholders entitled to 

vote at any meeting of stockholders shall be open to examination by any such stockholder. Previously, the Bylaws provided 

that the list would be made available for a period of at least 10 days prior to the meeting; the period of such availability is now 

at least five business days. The amendments also remove the requirement that the stockholders list be kept at the place of the 

meeting and open to examination throughout the duration of the meeting.

Section 3.10, as amended, is set forth below:

 Section 3.10 Stockholders’ List.

(a) A complete list of stockholders entitled to vote at any meeting of stockholders, showing the address of 

each such stockholder and the number of shares registered in his or her name, shall be open to the examination of any 

such stockholder, for any purpose germane to the meeting, during ordinary business hours for a period beginning no 

later than five business days following the delivery of the notice to shareholders pursuant to Section 3.3.(a) and 

continuing through the last business day before the meeting of stockholders, either at the principal office of the 

Corporation or at the office of its transfer agent.

(b) If the requirements of this Section have not been substantially complied with, the meeting shall, on the 

demand of any stockholder in person or by proxy, be adjourned until such requirements are complied with. Refusal or 

failure to prepare or make available the stockholders’ list shall not affect the validity of action taken at the meeting 

prior to the making of any such demand, but any action taken by the stockholders after the making of any such 

demand shall be invalid and of no effect.

A copy of our amended and restated Bylaws is filed as Exhibit 3.1 to this Quarterly Report on Form 10-Q.

Insider Trading Arrangements and Policies

We ceased paying our executive officers and directors stock-based compensation when we entered conservatorship. In 

addition, the Purchase Agreement prohibits us from issuing any of our equity securities, including as compensation to our 

directors and executive officers, without the prior written consent of Treasury, and no equity securities, other than the senior 

preferred stock issued to Treasury, have been issued since we entered conservatorship. Furthermore, company policy prohibits 

directors and executive officers from engaging in transactions involving our equity securities, except selling company securities 

owned prior to the implementation of the policy. No executive officer or director adopted or terminated any contract, 

instruction, or written plan for the purchase or sale of, or any other such trading arrangement for, our securities during 2Q 2023. 

For more information on executive officer and director compensation and security ownership by our executive officers and 

directors, see Directors, Corporate Governance, and Executive Officers, Executive Compensation and Security 

Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters in our 2022 Annual 

Report.

EXHIBITS

The exhibits are listed in the Exhibit Index of this Form 10-Q.

Other Information

Freddie Mac 2Q 2023 Form 10-Q 98
Controls and Procedures

EVALUATION OF DISCLOSURE CONTROLS AND 

PROCEDURES

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that the information 

we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and 

reported within the time periods specified by the SEC's rules and forms and that such information is accumulated and 

communicated to management of the company, including the company's Chief Executive Officer and Chief Financial Officer, as 

appropriate, to allow timely decisions regarding required disclosure. In designing our disclosure controls and procedures, we 

recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable 

assurance of achieving the desired control objectives, and we must apply judgment in implementing possible controls and 

procedures.

Management, including the company's Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the 

effectiveness of our disclosure controls and procedures as of June 30, 2023. As a result of management's evaluation, our Chief 

Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of 

June 30, 2023, at a reasonable level of assurance, because we have not been able to update our disclosure controls and 

procedures to provide reasonable assurance that information known by FHFA on an ongoing basis is communicated from 

FHFA to Freddie Mac's management in a manner that allows for timely decisions regarding our required disclosure under the 

federal securities laws. We consider this situation to be a material weakness in our internal control over financial reporting. 

CHANGES IN INTERNAL CONTROL OVER FINANCIAL 

REPORTING DURING 2Q 2023

We evaluated the changes in our internal control over financial reporting that occurred during 2Q 2023 and concluded that 

there were no changes that materially affected, or are reasonably likely to materially affect, our internal control over financial 

reporting.

MITIGATING ACTIONS RELATED TO THE MATERIAL 

WEAKNESS IN INTERNAL CONTROL OVER FINANCIAL 

REPORTING

As described above under Evaluation of Disclosure Controls and Procedures, we have one material weakness in 

internal control over financial reporting as of June 30, 2023 that we have not remediated.

Given the structural nature of this material weakness, we believe it is likely that we will not remediate it while we are under 

conservatorship. However, both we and FHFA have continued to engage in activities and employ procedures and practices 

intended to permit accumulation and communication to management of information needed to meet our disclosure obligations 

under the federal securities laws. These include the following:

n	 FHFA has established the Division of Conservatorship Oversight and Readiness, which is intended to facilitate operation of 

the company with the oversight of the Conservator.

n	 We provide drafts of our SEC filings to FHFA personnel for their review and comment prior to filing. We also provide drafts 

of certain external press releases and statements to FHFA personnel for their review and comment prior to release.

n	 FHFA personnel, including senior officials, review our SEC filings prior to filing, including this Form 10-Q, and engage in 

discussions with us regarding issues associated with the information contained in those filings. Prior to filing this Form 10-

Q, FHFA provided us with a written acknowledgment that it had reviewed the Form 10-Q, was not aware of any material 

misstatements or omissions in the Form 10-Q, and had no objection to our filing the Form 10-Q.

n	 Our senior management meets regularly with senior leadership at FHFA, including, but not limited to, the Director.

n	 FHFA representatives attend meetings frequently with various groups within the company to enhance the flow of 

information and to provide oversight on a variety of matters, including accounting, credit and capital markets management, 

external communications, and legal matters.

n	 Senior officials within FHFA's accounting group meet frequently with our senior financial executives regarding our 

accounting policies, practices, and procedures.

In view of our mitigating actions related to this material weakness, we believe that our condensed consolidated financial 

statements for 2Q 2023 have been prepared in conformity with GAAP.

Controls and Procedures

Freddie Mac 2Q 2023 Form 10-Q 99
Exhibit Index

Exhibit Description*

3.1 Bylaws of the Federal Home Loan Mortgage Corporation, as amended and restated July 11, 2023

31.1 Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)

31.2 Certification of Executive Vice President and Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)

32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350

32.2 Certification of Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. Section 1350

101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within 

the Inline XBRL document

101.SCH XBRL Taxonomy Extension Schema

101. CAL XBRL Taxonomy Extension Calculation

101.DEF XBRL Taxonomy Extension Definition

101.LAB XBRL Taxonomy Label

101. PRE XBRL Taxonomy Extension Presentation

104 Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are 

embedded within the Inline XBRL document

*

The SEC file numbers for the Registrant's Registration Statement on Form 10, Annual Reports on Form 10-K, Quarterly Reports on Form 

10-Q, and Current Reports on Form 8-K are 000-53330 and 001-34139.

Exhibit Index

Freddie Mac 2Q 2023 Form 10-Q 100
Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on 

its behalf by the undersigned thereunto duly authorized.

Federal Home Loan Mortgage Corporation

By: /s/ Michael J. DeVito

Michael J. DeVito

Chief Executive Officer

(Principal Executive Officer)

Date: August 2, 2023

By: /s/ Christian M. Lown

Christian M. Lown

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

Date: August 2, 2023

Signatures

Freddie Mac 2Q 2023 Form 10-Q 101
Form 10-Q Index

Item Number Page(s)

PART I FINANCIAL INFORMATION

Item 1. Financial Statements 46 - 96

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 1 - 45

Item 3. Quantitative and Qualitative Disclosures About Market Risk 31 - 33

Item 4. Controls and Procedures 99

PART II OTHER INFORMATION

Item 1. Legal Proceedings 97

Item 1A. Risk Factors 97

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 97 - 98

Item 5. Other Information 98

Item 6. Exhibits 98

Exhibit Index 100

Signatures 101

Form 10-Q Index

Freddie Mac 2Q 2023 Form 10-Q 102
Exhibit 3.1

BYLAWS OF THE FEDERAL HOME LOAN MORTGAGE CORPORATION

As amended and restated July 11, 2023
FREDDIE MAC BYLAWS

TABLE OF CONTENTS

Page

ARTICLE 1 OFFICES 1

Section 1.1 Offices 1

ARTICLE 2 CAPITAL STOCK 1

Section 2.1 Issuance 1

Section 2.2 Common Stock 1

Section 2.3 Preferred Stock 1

Section 2.4 Consideration 1

Section 2.5 Shares Owned by the Corporation 1

Section 2.6 Fractional Shares 2

Section 2.7 Certificates 2

Section 2.8 Transfer of Shares 2

Section 2.9 Lost, Destroyed and Mutilated Certificates 3

Section 2.10 Fixing a Record Date 3

Section 2.11 Record of Stockholders 3

Section 2.12 Ownership of Shares 4

Section 2.13 Share Options and Other Instruments 4

ARTICLE 3 MEETINGS OF THE STOCKHOLDERS 4

Section 3.1 Annual Meetings 4

Section 3.2 Special Meetings 5

Section 3.3 Notice of Meetings 6

Section 3.4 Quorum 7

Section 3.5 Organization 8

Section 3.6 Conduct of Business 8

Section 3.7 Voting 10

Section 3.8 Voting Entitlement of Shares 10

Section 3.9 Proxies 11

Section 3.10 Stockholders’ List 12

-i-
TABLE OF CONTENTS

(continued)

Page

ARTICLE 4 BOARD OF DIRECTORS 13

Section 4.1 General Powers 13

Section 4.2 Number, Qualification and Term of Office 13

Section 4.3 Nominations 13

Section 4.4 Vacancies 14

Section 4.5 Elections 14

Section 4.6 Chair 15

Section 4.7 Lead Director 15

Section 4.8 Regular Meetings 16

Section 4.9 Special Meetings 16

Section 4.10 Quorum 16

Section 4.11 Participation in Meetings 16

Section 4.12 Conduct of Business 17

Section 4.13 Reimbursement and Compensation of Directors 18

Section 4.14 Committees of the Board of Directors 18

Section 4.15 Resignation 19

Section 4.16 Removal of Directors 19

Section 4.17 Termination of Voluntary Registration of Common Stock 19

ARTICLE 5 OFFICERS 19

Section 5.1 Officers of the Corporation 19

Section 5.2 Appointment and Term 19

Section 5.3 Removal, Resignation, Vacancy 20

Section 5.4 Compensation 20

Section 5.5 Duties 21

Section 5.6 Chief Executive Officer 21

Section 5.7 President 21

Section 5.8 Chief Operating Officer 21

Section 5.9 General Auditor 21

Section 5.10 Vice Presidents 21

Section 5.11 Corporate Secretary 21

Section 5.12 Delegation of Authority 22

-ii-
TABLE OF CONTENTS

(continued)

Page

ARTICLE 6 INSPECTION OF RECORDS 22

Section 6.1 Inspection of Records by Stockholders 22

Section 6.2 Inspection of Records by Directors 23

ARTICLE 7 NOTICES 23

Section 7.1 Notices 23

Section 7.2 Written Waivers 25

ARTICLE 8 INDEMNIFICATION AND LIMITATION OF LIABILITY 25

Section 8.1 Indemnification 25

Section 8.2 Right of Indemnitee to Bring Suit 27

Section 8.3 Non-Exclusivity of Rights 28

Section 8.4 Insurance 28

Section 8.5 Limitation of Liability 28

ARTICLE 9 SEAL 29

Section 9.1 Corporate Seal 29

ARTICLE 10 FISCAL YEAR 29

Section 10.1 Fiscal Year 29

ARTICLE 11 MISCELLANEOUS 29

Section 11.1 Time Periods 29

Section 11.2 Severability 29

Section 11.3 Corporate Governance Practices and Procedures and 

Governing Law 29

Section 11.4 Certificates of Designation 30

Section 11.5 Statutory References 30

Section 11.6 Control Share Acquisitions 30

ARTICLE 12 AMENDMENTS 30

Section 12.1 General 30

Section 12.2 Amendment by the Board of Directors 30

Section 12.3 Amendment by the Stockholders 31

-iii-
ARTICLE 1 – OFFICES

Section 1.1 Offices. The principal office of the Corporation shall be in Fairfax 

County, Virginia or at any other place determined by the Board of Directors. The 

Corporation may have such other offices as the Board of Directors or the Chief Executive 

Officer shall determine appropriate.

ARTICLE 2 – CAPITAL STOCK

Section 2.1 Issuance. The Board of Directors shall have the power to authorize 

the issuance of one or more classes or series of stock of the Corporation, including, 

without limitation, voting common and preferred stock. All stock shall be issued on such 

terms and conditions as the Board of Directors shall prescribe from time to time.

Section 2.2 Common Stock. The voting common stock of the Corporation (the 

“Common Stock”) shall consist of such number of shares as may be issued or authorized 

for issuance from time to time by the Board of Directors (without limitation upon the 

authority of the Board of Directors to authorize the issuance of additional shares from time 

to time). The Common Stock shall have the designation, powers, rights, privileges, 

qualifications, limitations, restrictions, terms and conditions set forth in the Eighth 

Amended and Restated Certificate of Designation, Powers, Preferences, Rights, 

Privileges, Qualifications, Limitations, Restrictions, Terms and Conditions of Voting 

Common Stock adopted on September 10, 2008, as further amended or restated from 

time to time (the “Common Stock Certificate of Designation”). No holder of Common Stock 

shall as such holder have any preemptive right to purchase or subscribe for any other 

shares, rights, options, or other securities of any class of the Corporation which at any 

time may be sold or offered for sale by the Corporation.

Section 2.3 Preferred Stock. The preferred stock of the Corporation shall 

consist of such number of shares as may be issued or authorized for issuance from time 

to time by the Board of Directors (without limitation upon the authority of the Board of 

Directors to authorize the issuance of additional shares from time to time). Each class of 

preferred stock shall have the designation, powers, preferences, rights, privileges, 

qualifications, limitations, restrictions, terms and conditions set forth in the certificate of 

designation approved by the Board of Directors for such class.

Section 2.4 Consideration. Shares of stock may be issued to the Corporation’s 

stockholders pro rata and without consideration. Shares of stock may also be issued for 

consideration consisting of any tangible or intangible property or benefit to the Corporation 

as the Board of Directors deems appropriate. Upon the Board of Directors making a good 

faith determination that the consideration received for the shares to be issued is adequate, 

the shares issued therefor shall be fully paid and nonassessable.

Section 2.5 Shares Owned by the Corporation. Any shares of capital stock 

owned by the Corporation shall retain the status of issued shares, unless and until the 

Corporation shall retire and cancel the same, but such shares shall not be regarded as 

outstanding while so owned.
Section 2.6 Fractional Shares. No fractional interests in shares of common 

stock will be created or recognized by the Corporation except as otherwise provided in the 

Corporation’s Employee Stock Purchase Plan or any other executive compensation or 

employee benefit plan or any direct stock purchase plan currently in effect or hereafter 

adopted by the Corporation. The holder of a fractional share is entitled to exercise the 

rights of a shareholder, including the right to vote, to receive dividends, and to participate 

in the assets of the Corporation upon dissolution.

Section 2.7 Certificates.

(a) The Board of Directors may authorize the issuance of shares of stock of the 

Corporation with or without certificates. The rights and obligations of stockholders shall be 

identical whether or not their shares are represented by certificates. Stock certificates 

shall be in the form approved by the Corporate Secretary. Each stock certificate shall 

contain the name of the Corporation, the name of the stockholder, the number and kind of 

shares of stock owned by such stockholder, and reference to any other material terms of 

the stock represented thereby, including, without limitation, the information required to be 

set forth on such certificates by the Common Stock Certificate of Designation, shall be 

signed by the Chief Executive Officer or President and countersigned by the Corporate 

Secretary or an Assistant Secretary, and shall be sealed with the Corporation’s seal or a 

facsimile of such seal. Within a reasonable time after the issuance or transfer of shares 

without certificates, the Corporation shall send to the registered stockholder a written 

statement containing the information required to be set forth on the certificates, including, 

without limitation, the information required to be set forth on such certificates by the 

Common Stock Certificate of Designation, or a statement that the Corporation will furnish 

such information upon request and without charge.

(b) When any stock certificate is countersigned by a transfer agent or a 

registrar, other than the Corporation or its employee, any other signature on such 

certificate may be a facsimile. If any corporate officer who has signed any certificate 

ceases to be a corporate officer before such certificate is issued, whether because of 

death, resignation or otherwise, the certificate may nevertheless be issued and delivered 

by the Corporation as if such officer had not ceased to be such as of the certificate’s issue 

date.

Section 2.8 Transfer of Shares. Except as otherwise provided in the 

Corporation’s Employee Stock Purchase Plan or any other executive compensation or 

employee benefit plan or any direct stock purchase plan currently in effect or hereafter 

adopted by the Corporation, the Common Stock shall be transferable only in whole 

shares. Subject to the foregoing, the stock of the Corporation shall be transferable or 

assignable only on the transfer books of the Corporation or by transfer agents designated 

to transfer shares of stock of the Corporation by the registered holder thereof, in person or 

by a duly authorized attorney, and, in the case of certificated shares, upon the surrender 

and cancellation of such certificates representing the shares to be transferred, properly 

endorsed and, if sought to be transferred by such attorney,

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accompanied by a written power of attorney to have the same transferred on the books of 

the Corporation. The Board of Directors shall have power and authority to make such 

other rules and regulations concerning the issuance, transfer and registration of 

certificates of stock as it may deem appropriate.

Section 2.9 Lost, Destroyed and Mutilated Certificates. If any holder of the 

shares of the Corporation in certificated form shall notify the Corporation of any loss, theft, 

destruction or mutilation of such certificate(s), the Chief Executive Officer may, in his or 

her discretion, cause one or more new certificate(s) for the same number of shares in the 

aggregate to be issued to such stockholder upon the surrender of the mutilated certificate, 

or upon delivery by the stockholder or such stockholder’s legal representative of a bond, 

with or without surety, or such other agreement, undertaking or security as the Corporate 

Secretary shall determine is appropriate, to indemnify the Corporation against any claim 

that may be made against the Corporation on account of the alleged loss, theft or 

destruction of any such certificate(s) or the issuance of any new certificate(s).

Section 2.10 Fixing a Record Date. Except as otherwise provided in the 

Common Stock Certificate of Designation, or any other certificate of designation relating to 

any class of the Corporation’s preferred stock, for the purpose of determining stockholders 

entitled to notice of, or to vote at, any meeting of stockholders or any adjournment thereof, 

or entitled to receive payment of any dividend, or in order to make a determination of 

stockholders for any other proper purpose, the Board of Directors may fix in advance a 

date as the record date for any such determination of stockholders, such date in any case 

to be not more than 70 days before the meeting or action requiring a determination of 

stockholders and, in the case of record dates for dividends on the preferred stock, subject 

to any additional limitations set forth in the related certificate of designation. If no record 

date is fixed for the determination of (i) stockholders entitled to notice of, or to vote at, a 

meeting of stockholders or (ii) stockholders entitled to receive payment of a dividend, the 

date on which notices of the meeting are first mailed or otherwise given or the date on 

which the resolution of the Board of Directors declaring such dividend is adopted, as the 

case may be, shall be the record date for such determination of stockholders. When a 

determination of stockholders entitled to vote at any meeting of stockholders has been 

made as provided in this Section, such determination shall apply to any adjournment 

thereof unless the Board of Directors fixes a new record date, which it shall do if the 

meeting is adjourned to a date more than 120 days after the date fixed for the original 

meeting.

Section 2.11 Record of Stockholders. A record shall be kept of the names of the 

persons and entities owning the stock represented by each share of stock of the 

Corporation, the number of shares represented by each certificate or information 

statement issued in respect of noncertificated shares and the dates of issuance thereof in 

a form that permits the preparation of a list of the names and addresses of all stockholders 

in alphabetical order showing the number of shares held by each.

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Section 2.12 Ownership of Shares. The Corporation and any agent thereof may 

deem and treat the holder of a share or shares of stock, as shown in the Corporation’s 

books and records, as the absolute owner of such share or shares of stock for the 

purpose of receiving payment of dividends in respect of such share or shares of stock and 

for all other purposes whatsoever, and neither the Corporation nor any agent thereof shall 

be affected by any notice to the contrary. All payments made to or upon the order of any 

such person shall be valid and, to the extent of the sum or sums so paid, effectual to 

satisfy and discharge liabilities for moneys payable by the Corporation on or with respect 

to any such share or shares of stock.

Section 2.13 Share Options and Other Instruments. The Corporation may 

issue rights, options or warrants for the purchase of shares or other securities of the 

Corporation, subject to stockholder approval to the extent required by applicable laws, 

regulations or listing standards. The Board of Directors may authorize the issuance of 

rights, options or warrants and determine the terms upon which the rights, options or 

warrants are issued, including, without limitation, the consideration for which the shares or 

other securities are to be issued. The authorization for the Corporation to issue such 

rights, options or warrants constitutes authorization of the issuance of the shares or other 

securities for which the rights, options or warrants are exercisable.

ARTICLE 3 – MEETINGS OF THE STOCKHOLDERS

Section 3.1 Annual Meetings.

(a) An annual meeting of the stockholders, for the election of directors and for 

the transaction of such other business as may properly come before the meeting, shall be 

held on such date, at such time and at such place as the Board of Directors shall each 

year fix, which date shall be within 15 months after the immediately preceding meeting of 

stockholders. The failure to hold an annual meeting at the time stated in, or fixed in 

accordance with, these Bylaws shall not affect the validity of any corporate action.

(b) Upon notice to the Corporation, any stockholder of the Corporation entitled 

to participate in an annual meeting may petition the United States District Court for the 

district within which the Corporation’s principal office is located to order an annual meeting 

of stockholders if an annual meeting has not been held within 15 months after the 

Corporation’s immediately preceding annual meeting. The court may fix the time and place 

of the meeting, determine the shares entitled to notice of and to vote at the meeting, 

prescribe the form and content of the meeting notice and enter other orders necessary to 

accomplish the purpose or purposes of the meeting.

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Section 3.2 Special Meetings.

(a) Special meetings of the stockholders, for any purpose or purposes 

prescribed in the notice of the meeting, may be called by a majority of the directors then in 

office or the Chair of the Board (“Chair”), and shall be held on such date, at such time and 

at such place as they or he or she shall fix.

(b) Special meetings of the stockholders, for any purpose or purposes 

prescribed in the notice of the meeting, may also be called by the Corporate Secretary 

upon the written request of the holders of at least a majority of all shares of voting stock 

entitled to vote; provided, however, a special meeting of the stockholders for the purposes 

of Section 4.16 of these Bylaws must be requested by the holders of at least one-third of 

all shares of voting stock entitled to vote. A special meeting of the stockholders called 

pursuant to the preceding sentence shall be referred to in these Bylaws as a “Stockholder 

Requested Special Meeting”. A Stockholder Requested Special Meeting shall be held on 

such date, at such time and at such place as determined by the Corporate Secretary as 

soon as is reasonably practicable following the Corporation’s receipt of a written request 

that is in compliance with this Section 3.2 (the “Delivery Date”) and, unless the 

penultimate paragraph of this Section applies, within 75 calendar days of the Delivery 

Date. The record date for determining stockholders entitled to request for a Stockholder 

Requested Special Meeting shall be the later of (i) the date the first stockholder signs the 

request, or (ii) the earliest record date permitted by Section 2.10 of these Bylaws.

Upon notice to the Corporation, any stockholder of the Corporation who 

signed the request for a Stockholder Requested Special Meeting, may petition the United 

States District Court for the district within which the Corporation’s principal office is located 

to order a special meeting of stockholders if a special meeting notice has not been held as 

provided herein. The court may fix the time and place of the meeting, determine the 

shares entitled to notice of and to vote at the meeting, prescribe the form and content of 

the meeting notice, and enter other orders necessary to accomplish the purpose or 

purposes of the meeting.

A written request of the holders of the voting stock made pursuant to this 

Section 3.2 must (i) be signed, dated and delivered to the Corporate Secretary at the 

principal executive offices of the Corporation by each stockholder making the request for a 

Stockholder Requested Special Meeting, (ii) identify the name and record address of each 

stockholder making the request for a Stockholder Requested Special Meeting,

(iii) include a brief description of the business desired to be brought before such 

Stockholder Requested Special Meeting, the reasons for conducting such business, a 

statement of specific purpose(s) of the meeting and the matter proposed to be acted on at 

it, which matter must be a proper subject for stockholder action, (iv) shall be accompanied 

by documentation to verify the class and number of shares of the Corporation that are 

beneficially owned by each stockholder making such request in accordance with the 

Securities Exchange Act of 1934, as amended (the “Exchange Act”), specifically Rule 

14a-8(b)(2) of Regulation 14A (Solicitation of Proxies) (the “Proxy Rules Requirement”),

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(v) contain a representation that each stockholder submitting the request intends to 

appear in person or by proxy at the Stockholder Requested Special Meeting to transact 

the business specified, and (vi) contain a representation that each stockholder submitting 

the request intends to continue ownership of shares of the voting stock through the date of 

the Stockholder Requested Special Meeting. The Corporation may require any 

stockholder making such request to furnish such other information as may reasonably be 

required by the Corporation to determine the eligibility of stockholders to make a written 

request pursuant to this Section 3.2. Failure of the stockholders who sign the request for a 

Stockholder Requested Special Meeting to comply with the representations identified in 

(v) and (vi) above, shall be deemed to constitute a revocation of such request. Any 

stockholder who submitted a request for a Stockholder Requested Special Meeting may 

revoke such request at any time by written revocation delivered to the Corporate 

Secretary at the principal executive offices of the Corporation.

The Corporate Secretary shall not be required to call a Stockholder 

Requested Special Meeting if (i) the Board of Directors calls an annual or special meeting 

of stockholders to be held not later than 75 days after the Delivery Date and the 

purpose(s) of such meeting includes the purpose(s) specified by the requisite number of 

stockholders in the special meeting request(s), or (ii) an annual or special meeting was 

held not more than 12 months before the Delivery Date, which included the purpose(s) 

specified by the requisite number of stockholders in the special meeting request(s), with 

such determination being made in good faith by the Board of Directors. In determining 

whether a request for a Stockholder Requested Special Meeting has been submitted by 

stockholders holding the requisite number of shares of voting stock, there may be 

excluded from the computation, the shares of the voting stock owned by any stockholder 

who has signed the request for a Stockholder Requested Special Meeting at any time 

during the 2 calendar years preceding the Delivery Date and has failed to comply with the 

representations identified in (v) and (vi) above.

(c) At a special meeting, no business shall be transacted and no action shall be 

taken other than as stated in the notice of the meeting; provided that nothing herein shall 

prohibit the Board of Directors from submitting other matters to the stockholders at a 

Stockholder Requested Special Meeting.

Section 3.3 Notice of Meetings.

(a) Written or printed notice of the date, time and place of all meetings of the 

stockholders and, in the case of a special meeting, the purpose or purposes for which the 

meeting is called, shall be given no fewer than 10 nor more than 60 days before the date 

on which the meeting is to be held, to each holder of voting stock entitled to vote at such 

meeting, except as otherwise provided in these Bylaws.

When a meeting is adjourned to another date, time or place, written notice 

need not be given of the adjourned meeting if the date, time or place thereof are 

announced at the meeting at which the adjournment is taken; provided, however, that, if

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the date of any adjourned meeting is more than 120 days after the date for which the 

meeting was originally noticed, or if a new record date is fixed for the adjourned meeting, 

written notice of the date, time or place of the adjourned meeting shall be given in 

conformity herewith.

(b) A stockholder’s attendance at a meeting, whether in person or by proxy, (i) 

waives objection to lack of notice or defective notice of the meeting, unless the 

stockholder at the beginning of the meeting objects to holding the meeting or transacting 

business at the meeting; and (ii) waives objection to consideration of a particular matter at 

the meeting that is not within the purpose or purposes described in the meeting notice 

unless the stockholder objects to considering the matter when it is presented.

Notwithstanding the foregoing, no notice of a stockholders’ meeting need 

be given to a stockholder if (i) notices to such stockholder of two consecutive annual 

meetings, and all notices of meetings during the period between two consecutive annual 

meetings, have been sent, other than by electronic transmission, to such stockholder at 

such stockholder’s address as shown on the records of the Corporation and have been 

returned undeliverable or could not be delivered or (ii) all, but not less than two, 

distributions to stockholders during a period of more than 12 months, have been sent to 

such stockholder at such stockholder’s address as shown on the records of the 

Corporation and have been returned undeliverable or could not be delivered. If any 

stockholder, for which notice is not required, delivers to the Corporation a written notice 

setting forth such stockholder’s then-current address, the requirement that notice be given 

shall be reinstated.

(c) For purposes of these Bylaws, “electronic transmission” means any form or 

process of communication, not directly involving the physical transfer of paper or other 

tangible medium, that (i) is suitable for the retention, retrieval, and reproduction of 

information by the recipient and (ii) is retrievable in paper form by the recipient through an 

automated process used in conventional commercial practice; provided, however, a notice 

or other communication may be in the form of an electronic transmission that cannot be 

directly reproduced in paper form by the recipient through an automated process used in 

conventional commercial practice if (x) the electronic transmission is otherwise retrievable 

in perceivable form and (y) the sender and the recipient have consented in writing to the 

use of such form of electronic transmission.

Section 3.4 Quorum.

(a) At any meeting of the stockholders, the holders of a majority of all shares of 

voting stock entitled to vote at the meeting, present in person or by proxy, shall constitute 

a quorum, except as otherwise provided in this Section. If a quorum shall fail to attend a 

meeting, the chair of the meeting or the holders of a majority of all shares of voting stock 

entitled to vote at the meeting who are present, in person or by proxy, may adjourn the 

meeting to another date, time or place.

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(b) Once a share of stock is represented for any purpose at a meeting, it is 

deemed present for quorum purposes for the remainder of the meeting and for any 

adjournment of that meeting unless a new record date is or shall be set for that adjourned 

meeting.

Section 3.5 Organization. The Chair or, in the absence of the Chair, another 

director designee of the Board of Directors or, in the absence of the Chair and such a 

designation, the Chief Executive Officer or in his or her absence, the President or, in the 

absence of both such officers, such person as may be chosen by the holders of a majority 

of all shares of voting stock entitled to vote who are present, in person or by proxy, shall 

call to order any meeting of the stockholders and shall act as chair of the meeting. In the 

absence of the Corporate Secretary, the secretary of the meeting shall be such person as 

the chair of the meeting appoints.

Section 3.6 Conduct of Business.

(a) The chair of any meeting of stockholders shall determine the order of 

business and shall have the authority to establish rules for the conduct of the meeting, 

including such regulation of the manner of voting and the conduct of discussion, 

restrictions on attendance at a meeting so long as stockholders or their proxies are not 

excluded, and adjournment of the meeting to be reconvened at a later date, as seem to 

him or her in order and not inconsistent with these Bylaws.

(b) No business shall be brought before any meeting except in accordance with 

the procedures set forth in these Bylaws, and the rules, if any, established by the chair of 

the meeting for the conduct of the meeting; provided, however, that nothing in this Section 

shall be deemed to preclude discussion by any stockholder of any business properly 

brought before such meeting.

(c) At any meeting of the stockholders, only such business shall be conducted 

as shall have been properly brought before the meeting. The chair of any meeting shall, if 

the facts warrant, determine that business was not properly brought before the meeting, 

and, if the chair should so determine, he or she shall so declare to the meeting and any 

such business not properly brought before the meeting shall not be conducted. At any 

adjourned meeting, any business may be transacted and any action taken which might 

have been transacted or taken at the original meeting.

(d) To be properly brought before an annual meeting, business must be 

specified in the notice of meeting (or any supplement thereto) given by or at the direction 

of the Board of Directors, or otherwise brought before the meeting by or at the direction of 

the Board of Directors, or otherwise properly brought before the meeting by a stockholder. 

In addition to any other applicable requirements, including, without limitation, Rule 14a-8 

under the Exchange Act, if applicable, for business other than a director nomination to be 

properly brought before an annual meeting by a stockholder, the stockholder must have 

given timely notice thereof in writing to the Corporate Secretary at the principal executive 

office of the Corporation. (The exclusive procedures for stockholders to make nominations

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for the election of directors at any annual meeting are set forth in Section 4.3.) The 

content of the stockholders’ notice must comply with the requirements of this Section 3.6. 

The requirements of this Section 3.6 shall apply to any business a stockholder wishes to 

bring before an annual meeting, whether under Rule 14a-8 under the Exchange Act or 

otherwise. To be timely, a stockholder’s notice must be received at the principal office of 

the Corporation no fewer than 75 days prior to such annual meeting. In the event that 

fewer than 90 days’ notice or prior public disclosure of the date of such annual meeting is 

given or made to stockholders, notice by the stockholder, to be timely, must be so 

received not later than the close of business on the 15th day following the day on which 

such notice of the date of such annual meeting was mailed or such public disclosure was 

made, whichever first occurs. A written notice must (i) be signed, dated and delivered to 

the Corporate Secretary at the principal executive offices of the Corporation by the 

stockholder, (ii) identify the name and record address of the stockholder submitting the 

notice, (iii) include a brief description of the business, which must be a proper subject for 

stockholder action, desired to be brought before such annual meeting and the reasons for 

conducting such business, (iv) shall be accompanied by documentation to verify the class 

and number of shares of the Corporation that are beneficially owned by the stockholder 

submitting such notice in accordance with the Exchange Act, specifically the Proxy Rules 

Requirement, (v) contain a representation that the stockholder submitting the notice 

intends to appear in person or by proxy at the annual meeting to transact the business 

specified, (vi) contain a representation that the stockholder submitting the notice intends to 

continue ownership of shares of the voting stock through the date of the annual meeting, 

and (vii) set forth any material interest of the stockholder in the matter identified in (iii) 

above. The Corporation may require any stockholder submitting such notice to furnish 

such other information as may reasonably be required by the Corporation to determine the 

eligibility of stockholders to give a written notice pursuant to this Section 3.6.

(e) At a special meeting, no business shall be transacted and no action shall be 

taken other than as stated in the notice of the meeting; provided that nothing herein shall 

prohibit the Board of Directors from submitting other matters to the stockholders at a 

Stockholder Requested Special Meeting.

(f) To the extent authorized by the Board of Directors with respect to any 

meeting, which may be held at a physical location or in a fully virtual environment, 

stockholders may participate in such a meeting by use of any means of communication by 

which all stockholders participating may simultaneously hear each other during the 

meeting including, without limitation, by use of internet accessible electronic meeting 

facilities. A stockholder participating in a stockholders’ meeting by such means is deemed 

to be present in person at the meeting.

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Section 3.7 Voting.

(a) Except as otherwise provided in Section 8.1(c) of these Bylaws, each 

stockholder shall have one vote for every share of stock entitled to vote which is 

registered in his or her name on the record date for the meeting.

(b) Subject to the determination of the Board of Directors of the Corporation to 

authorize action by written consent under Section 3(b) of the Common Stock Certificate of 

Designation, votes shall be cast in person or by proxy at annual or special meetings of the 

holders of the shares of voting stock entitled to vote. All voting, including the election of 

directors, may be by a voice vote; provided, however, that upon demand by a holder of 

voting stock entitled to vote or his or her proxy or in the discretion of the chair of the 

meeting, a vote shall be taken by ballots, each of which shall state the name of the 

stockholder or proxy voting and such other information as may be required under the rules 

of conduct established for the meeting.

(c) The Corporation shall appoint one or more inspectors to oversee, determine 

and certify attendance and results of any voting at the meeting and make a written report 

of the inspector’s determinations. Each inspector, before entering upon the discharge of 

his duties, shall take and sign an oath faithfully to execute the duties of inspector with 

strict impartiality and according to the best of his or her ability. The inspectors may appoint 

or retain other persons or entities to assist the inspectors in the performance of their 

duties.

(d) All elections for a seat on the Board of Directors shall be determined as 

provided by Section 4.5 of these Bylaws, and on all other matters, action shall be 

approved if the votes cast favoring the action exceed the votes cast opposing the action, 

unless a greater vote is prescribed by the Board of Directors or other person proposing 

the matter or otherwise required by these Bylaws.

(e) An abstention or an election by a stockholder not to vote on an action 

because of failure to receive voting instructions from the beneficial owner of the shares 

shall not be considered a vote cast.

(f) Stockholders shall not vote their shares cumulatively.

Section 3.8 Voting Entitlement of Shares.

(a) Shares standing in the name of another corporation may be voted by such 

officer, agent or proxy as the bylaws of such corporation may prescribe, or, in the absence 

of such provision, as the board of directors of such corporation may determine.

(b) Shares standing in the name of a partnership may be voted by any partner. 

Shares standing in the name of a limited liability company may be voted as the articles of 

organization or an operating agreement may prescribe, or in the absence of any such 

provision as the managers, or if there are no managers, the members of the limited liability 

company may determine.

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(c) Shares held by two or more persons as joint tenants or tenants in common 

or tenants by the entirety may be voted by any of such persons. If more than one of such 

tenants vote such shares, the vote shall be divided among them in proportion to the 

number of such tenants voting.

(d) Shares held by an administrator, executor, guardian, committee or curator 

representing the holder of voting stock may be voted by such person without a transfer of 

such shares into such person’s name. Shares standing in the name of a trustee may be 

voted by the trustee, but no trustee shall be entitled to vote shares held by him or her 

without a transfer of such shares into the trustee’s name.

(e) Shares standing in the name of a receiver or a trustee in proceedings under 

the applicable bankruptcy laws may be voted by such person. Shares held by or under the 

control of a receiver or a trustee in proceedings under the applicable bankruptcy laws may 

be voted by such person without the transfer thereof into his or her name if authority to do 

so is contained in an order of the court by which such person was appointed.

(f) Nothing herein contained shall prevent trustees or other fiduciaries holding 

shares registered in the name of a nominee from causing such shares to be voted by such 

nominee as the trustee or other fiduciary may direct. Such nominee may vote shares as 

directed by a trustee or other fiduciary without the necessity of transferring the shares to 

the name of the trustee or other fiduciary.

(g) When shares are held by more than one fiduciary, the shares shall be voted 

as determined by a majority of such fiduciaries, except that: (i) if they are equally divided 

as to a vote, the vote of shares shall be divided equally and (ii) if only one of such 

fiduciaries is present in person or by proxy at a meeting, such fiduciary shall be entitled to 

vote all the shares.

(h) A holder of voting stock whose shares are pledged shall be entitled to vote 

such shares until the shares have been transferred into the name of the pledgee, and 

thereafter the pledgee shall be entitled to vote the shares so transferred.

Section 3.9 Proxies.

(a) At any meeting of the stockholders, every holder of voting stock entitled to 

vote may vote in person or by proxy. A stockholder or the stockholder’s agent or attorneyin-fact may appoint a proxy to vote or otherwise act for the stockholder by signing an 

appointment form or by an electronic transmission. An electronic transmission shall 

contain or be accompanied by information from which one can determine that the 

stockholder, the stockholder’s agent or the stockholder’s attorney-in-fact authorized the 

transmission. Any copy, facsimile telecommunication or other reliable reproduction of the 

writing or transmission created pursuant to this Subsection may be substituted or used in 

lieu of the original writing or transmission for any and all purposes for which the original 

writing or transmission could be used, provided that such copy, facsimile

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telecommunication or other reproduction shall be a complete reproduction of the entire 

original writing or transmission. No proxy shall be voted after eleven months from its date, 

unless a longer period is expressly provided in the appointment form or electronic 

transmission.

(b) An appointment of a proxy is revocable unless the appointment form or 

electronic transmission states that it is irrevocable and the appointment is coupled with an 

interest. An appointment made irrevocable in accordance with the immediately preceding 

sentence is revoked when the interest with which it is coupled is extinguished.

(c) The death or incapacity of the stockholder appointing a proxy does not 

affect the right of the Corporation to accept the proxy’s authority unless notice of the death 

or incapacity is received by the Corporate Secretary or other officer or agent authorized to 

tabulate votes before the proxy exercises his or her authority under the appointment.

(d) Subject to Section 3.8 of these Bylaws and to any express limitation on the 

proxy’s authority stated in the appointment form or electronic transmission, the 

Corporation is entitled to accept the proxy’s vote or other action as that of the stockholder 

making the appointment.

(e) Any fiduciary who is entitled to vote any shares may vote such shares by 

proxy.

Section 3.10 Stockholders’ List.

(a) A complete list of stockholders entitled to vote at any meeting of 

stockholders, showing the address of each such stockholder and the number of shares 

registered in his or her name, shall be open to the examination of any such stockholder, 

for any purpose germane to the meeting, during ordinary business hours for a period 

beginning no later than five business days following the delivery of the notice to 

shareholders pursuant to Section 3.3.(a) and continuing through the last business day 

before the meeting of stockholders, either at the principal office of the Corporation or at 

the office of its transfer agent.

(b) If the requirements of this Section have not been substantially complied 

with, the meeting shall, on the demand of any stockholder in person or by proxy, be 

adjourned until such requirements are complied with. Refusal or failure to prepare or make 

available the stockholders’ list shall not affect the validity of action taken at the meeting 

prior to the making of any such demand, but any action taken by the stockholders after the 

making of any such demand shall be invalid and of no effect.

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ARTICLE 4 – BOARD OF DIRECTORS

Section 4.1 General Powers. Subject to the limitations of law and regulation, 

the Board of Directors shall determine the general policies that govern the operations of 

the Corporation, and the Corporation shall be under the direction of the Board of Directors.

Section 4.2 Number, Qualification and Term of Office.

(a) The Board of Directors of the Corporation shall consist of 13 persons, or 

such other number as the Director of the Federal Housing Finance Agency determines 

appropriate who shall be elected annually by the stockholders. The Board of Directors 

shall at all times have as members at least one person from the homebuilding industry, at 

least one person from the mortgage lending industry, at least one person from the real 

estate industry, and at least one person from an organization that has represented 

consumer or community interests for not less than two years or one person who has 

demonstrated a career commitment to the provision of housing for low-income 

households.

(b) Each member of the Board of Directors shall be elected for a term ending 

on the date of the next annual meeting of the stockholders.

(c) The Board of Directors shall establish standards and qualifications relating 

to independence from management and may establish other qualifications for service on 

the Board of Directors, including limitations on length of service and age, as required 

under, or consistent with, applicable laws, regulations and stock exchange listing 

standards.

Section 4.3 Nominations.

(a) Only persons who are nominated in accordance with the following 

procedures shall be eligible for election as directors at any annual meeting of 

stockholders. Nominations of persons for election to the Board of Directors of the 

Corporation at any annual meeting of stockholders may be made only by (i) the Board of 

Directors, or (ii) by any stockholder of the Corporation entitled to vote for the election of 

directors at the meeting who complies with the notice procedures set forth in this Section; 

this clause (ii) shall be the exclusive means for a stockholder to make nominations for 

election of directors at any annual meeting of stockholders. (The exclusive procedures for 

stockholders to bring business other than nominations before a stockholders’ meeting are 

set forth in Section 3.6.) Such nominations made by a stockholder entitled to vote in the 

election of directors shall be made pursuant to timely notice in writing to the Corporate 

Secretary at the principal executive office of the Corporation. To be timely, a stockholder’s 

notice shall be received no fewer than 75 days prior to the meeting. In the event that fewer 

than 90 days’ notice or prior public disclosure of the date of the meeting is given or made 

to stockholders, notice by the stockholder, to be timely, must be so received not later than

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the close of business on the 15th day following the day on which such notice of the date of 

the meeting was mailed or such public disclosure was made, whichever first occurs. Such 

stockholder’s notice to the Corporate Secretary shall set forth (a) as to each person who 

the stockholder proposes to nominate for election or reelection as a director, (i) the name, 

age, business address and residential address of the person, (ii) the principal occupation 

or employment of the person, (iii) a description of all arrangements or understandings 

between the stockholder and each nominee and any other person(s) (naming such 

person(s)) pursuant to which arrangements or understandings the nominations(s) are to 

be made by the stockholder and (iv) such other information regarding each nominee 

proposed by such stockholder as is required to be disclosed in solicitations for proxies for 

election of directors pursuant to Section 14(a) of the Exchange Act; and (b) as to the 

stockholder submitting the notice, the notice must (i) be signed and dated by the 

stockholder, (ii) identify the name and record address of the stockholder submitting the 

notice, (iii) be accompanied by documentation to verify the class and number of shares of 

the Corporation that are beneficially owned by the stockholder submitting such notice in 

accordance with the Exchange Act, specifically the Proxy Rules Requirement, (iv) contain 

a representation that the stockholder submitting the notice intends to appear in person or 

by proxy at the annual meeting to make the nomination(s) the stockholder has proposed, 

and (v) contain a representation that the stockholder submitting the notice intends to 

continue ownership of shares of the voting stock through the date of the annual meeting. 

The Corporation may require any proposed nominee to furnish such other information as 

may reasonably be required by the Corporation to determine the eligibility of such 

proposed nominee to serve as director of the Corporation and such nominee’s 

independence. No person shall be eligible for election as a director of the Corporation 

unless nominated in accordance with the procedures set forth in this Section.

(b) The chair of the meeting shall, if the facts warrant, determine that a 

nomination was not made in accordance with the foregoing procedures, and, if the chair 

should so determine, he or she shall so declare to the meeting and the defective 

nomination shall be disregarded.

Section 4.4 Vacancies. Any seat on the Board of Directors that becomes 

vacant after the annual election of the directors may be filled only by the Board of 

Directors, but only for the unexpired portion of the term. If the directors remaining in office 

constitute fewer than six directors, the remaining directors may fill such vacant seats on 

the Board of Directors as may exist by the affirmative vote of a majority of such remaining 

directors.

Section 4.5 Elections.

(a) Each director nominated for a seat on the Board of Directors of the 

Corporation shall be elected only if he or she receives a majority of the votes cast with 

respect to his or her election at the annual meeting of stockholders, provided that if it is 

determined that the number of persons properly nominated to serve as directors of the 

Corporation exceeds the number of directors to be elected (a “contested election”), the

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directors shall be elected by a plurality of the votes of the shares represented at the 

meeting and entitled to vote on the election of directors. A “majority of the votes cast” 

means that the number of votes cast “for” a director must exceed the number of votes cast 

“against” that director.

(b) Following any uncontested election, any incumbent director who was a 

nominee for a seat and who did not receive a majority of the votes cast by the 

stockholders shall promptly tender to the committee responsible for nominating and 

governance matters his or her offer of resignation for consideration by the Board of 

Directors. Within 60 days following certification of the election results, the committee of the 

Board of Directors responsible for nominating and governance matters shall recommend 

to the Board of Directors the action to be taken with respect to such offer of resignation. 

Within 90 days following certification of the election results, the Board of Directors shall 

act on the offered resignation. In determining whether or not to accept the offered 

resignation, the Board of Directors shall consider any recommendation of the committee 

responsible for nominating and governance matters, the factors considered by that 

committee and any additional information and factors that the Board of Directors believes 

to be relevant. No director who submits his or her resignation pursuant to this Section 4.5 

shall participate in the deliberations or decisions of the committee responsible for 

nominating and governance matters or the Board of Directors regarding such director’s 

resignation.

(c) If the submitted resignation is not accepted by the Board of Directors, the 

director shall continue to serve until the next annual meeting and until his or her successor 

is duly elected, or his or her death, resignation, retirement or removal in accordance with 

these Bylaws, applicable law or regulation, whichever event shall first occur. If a director’s 

resignation is accepted by the Board of Directors, or if a nominee for director who is not an 

incumbent director is not elected by the majority of the votes cast by the stockholders, 

then the Board of Directors, in its sole discretion, may fill any resulting vacancy in 

accordance with Section 4.4 of these Bylaws.

Section 4.6 Chair. Each year at the first meeting of the Board of Directors 

following the annual stockholders’ meeting, the Board of Directors shall elect from among 

its members a person to serve as Chair of the Board. The Chair shall be a member of the 

Board of Directors and shall preside at all meetings of the Board of Directors at which he 

or she is present.

Section 4.7 Lead Director. If the Chair is not independent from management 

under standards established by the Board of Directors pursuant to Section 4.2 of these 

Bylaws, those directors who are not employed by the Corporation shall elect from among 

themselves a person who is independent from management to serve as Lead Director. 

That election, if necessary, shall take place each year at the first meeting of the Board of 

Directors following the annual stockholders’ meeting and at any other time that the Board 

of Directors lacks a Lead Director who is independent from management. If the Chair is 

independent from management, the Chair shall serve as Lead Director unless the 

directors who are not employed by the Corporation elect from among themselves another

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director who is independent from management to serve as Lead Director. The Lead 

Director shall preside at all meetings of the directors who are not employees of the 

Corporation and of the directors who are independent from management at which he or 

she is present and shall perform such other duties as may be assigned by those directors.

Section 4.8 Regular Meetings. A regular meeting of the Board of Directors 

shall be held as soon as practicable after adjournment of the annual meeting of 

stockholders at such place as the Board of Directors may designate by resolution and 

without other notice than such resolution. The Board of Directors may provide, by 

resolution, for the date, time and place of additional regular meetings without other notice 

than such resolution.

Section 4.9 Special Meetings.

(a) Special meetings of the Board of Directors may be called by a majority of 

the directors then in office or by the Chair and shall be held on such date, at such time 

and at such place as they or he or she shall fix. Notice of the date, time and place of each 

such special meeting shall be given in accordance with Section 7.1 of these Bylaws to 

each director by (i) written notice given by mail, private courier or in person not less than 

48 hours before the meeting, (ii) oral notice given in person or by telephone not less than 

24 hours before the meeting or (iii) electronic transmission sent not less than 24 hours 

before the meeting. Unless otherwise indicated in the notice thereof, any and all business 

may be transacted at a special meeting.

(b) A director’s attendance at or participation in a meeting waives any required 

notice to him or her of the meeting unless the director at the beginning of the meeting or 

promptly upon arrival objects to holding the meeting or transacting business at the 

meeting and does not thereafter vote for or assent to action taken at the meeting.

Section 4.10 Quorum. At any meeting of the Board of Directors, a quorum shall 

consist of the greater of (i) one-third of the fixed number of directors or the prescribed 

number within a variable range of directors, as applicable, or (ii) a majority of the directors 

then in office. If a quorum shall fail to attend any meeting, a majority of those present may 

adjourn the meeting to another date, time or place, without further notice or waiver thereof. 

Members may not be represented by proxy at any meeting of the Board of Directors.

Section 4.11 Participation in Meetings. Members of the Board of Directors, or 

of any committee thereof, may participate in a meeting of the Board of Directors or of such 

committee by any means of communication by which all members participating in the 

meeting can simultaneously hear each other during the meeting and such participation 

shall constitute presence in person at such meeting.

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Section 4.12 Conduct of Business.

(a) At each meeting of the Board of Directors, the Chair shall preside or, in the 

absence of the Chair, a director selected by the Board of Directors. The Corporate 

Secretary or an Assistant Secretary designated by the Corporate Secretary shall act as 

secretary for the meeting, unless the Chair or director presiding at the meeting appoints 

another individual present at the meeting to act as secretary for the meeting.

(b) At any meeting of the Board of Directors, business shall be transacted in 

such order and manner as the Board of Directors may from time to time determine, and all 

matters shall be determined by the vote of a majority of the directors present at a meeting 

at which a quorum is present, except as otherwise provided in these Bylaws or in the 

Virginia Stock Corporation Act. A director shall not vote by proxy. A director present at a 

meeting is presumed to assent to actions unless the director objects at the beginning of 

the meeting, or promptly upon his or her arrival, to holding the meeting or transacting 

specified business at the meeting or the director votes against or abstains from the action 

and such objection, dissent or abstention is entered into the minutes of the meeting.

(c) Action may be taken by the Board of Directors without a meeting if each 

director signs a consent describing the action to be taken and delivers it to the 

Corporation. A director’s consent may be withdrawn by a revocation signed by the director 

and delivered to the Corporation prior to delivery to the Corporation of unrevoked written 

consents signed by all the directors. Such written consent and the signing thereof may be 

accomplished by one or more electronic transmissions.

(d) Action taken under the preceding paragraph shall be effective when the last 

director signs the consent unless the consent specifies a different effective date, in which 

event such action shall be effective as of the date specified therein, provided that the 

consent contains the date of execution of each director.

(e) Any director may provide that a consent to action shall be effective at a 

future time, including the time when an event occurs, but such future time shall not be 

more than 60 days after such provision is made. Any such consent shall be deemed to 

have been made for purposes of this subsection at the specified future time, provided that 

the director did not revoke the consent prior to such future time. Any such consent may be 

revoked, in the manner provided in subsection (c), prior to its becoming effective.

(f) A consent signed under this Section shall have the effect of action taken at 

a meeting of the Board of Directors and may be described as such in any document.

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Section 4.13 Reimbursement and Compensation of Directors. Pursuant to 

resolution of the Board of Directors, directors, as such, may receive fixed fees and other 

compensation for their services as directors, including, without limitation, their services as 

members of committees of the Board of Directors and may receive reimbursement of 

expenses incurred in respect of rendering such services; except that any member of the 

Board of Directors who is a full-time officer or employee of the federal government or fulltime officer or employee of the Corporation shall not receive compensation for services as 

a member of the Board of Directors or as a member of any committee of the Board of 

Directors.

Section 4.14 Committees of the Board of Directors.

(a) The Board of Directors may, from time to time, designate committees of the 

Board of Directors (and subcommittees of those committees), with such delegable powers 

and duties as it thereby confers, to serve at the pleasure of the Board of Directors and 

shall, for those committees and any others provided for herein, elect at least two directors 

to serve as the members. Any committee or subcommittee so designated may exercise 

the power and authority of the Board of Directors to the extent any resolution of the Board 

of Directors shall so provide, except that a committee or subcommittee may not: (i) 

approve or recommend to stockholders action that these Bylaws require be approved by 

stockholders; (ii) fill vacancies on the Board of Directors or on any of its committees; (iii) 

adopt, amend or repeal these Bylaws; (iv) approve a plan of merger not requiring 

stockholder approval; (v) authorize or approve a distribution, except according to a 

general formula or method prescribed by the Board of Directors; or (vi) authorize or 

approve the issuance or sale or contract for sale of shares, or determine the designation 

and rights, preferences and limitations of a class or series of shares, except that the Board 

of Directors may authorize a committee or the Chair to do so subject to such limits, if any, 

as may be prescribed by the Board of Directors.

(b) Unless otherwise provided by Board of Directors or committee or 

subcommittee resolution, the provisions of these Bylaws on date, time and place of, and 

notice required for, meetings of the Board of Directors shall govern committees of the 

Board of Directors (and their subcommittees). A majority of directors then appointed as 

members of a committee or a subcommittee shall constitute a quorum and all matters 

shall be determined by a majority vote of the members present at a meeting at which a 

quorum is present. Action may be taken by a committee (or a subcommittee) without a 

meeting if each member signs a consent describing the action to be taken and delivers it 

to the Corporation. A member’s consent may be withdrawn by a revocation signed by the 

member and delivered to the Corporation prior to delivery to the Corporation of unrevoked 

written consents signed by all the members. Such written consent and the signing thereof 

may be accomplished by one or more electronic transmissions. All minutes of committee 

or subcommittee meetings and unanimous consents of action taken by a committee or a 

subcommittee without a meeting shall also be submitted to the Board of Directors.

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(c) The Board of Directors shall designate committees responsible for 

overseeing the Corporation’s financial statements and relationship with its independent 

auditor, executive compensation matters and governance and nominating matters. The 

membership of each of those committees shall consist solely of directors who are 

independent from management under the standards established pursuant to Section 4.2 

of these Bylaws and shall comply with applicable laws, regulations and listing standards.

Section 4.15 Resignation. Any director may resign at any time by delivering a 

written resignation to the Board of Directors, the Chair or the Corporate Secretary. A 

resignation shall be effective upon delivery unless the notice specifies a later effective 

date. If a resignation is made effective at a later date, the Board of Directors may fill the 

pending vacancy before the effective date if the successor does not take office until the 

effective date.

Section 4.16 Removal of Directors. At a Stockholder Requested Special 

Meeting called expressly for that purpose, any director may be removed, but only with 

cause, by a vote of the holders of a majority of the voting stock then entitled to vote at an 

election of directors.

Section 4.17 Termination of Voluntary Registration of Common Stock.

The Corporation shall take no action to terminate the registration of the Corporation’s 

common stock under Section 12(g) of the Exchange Act, unless such action has been 

approved by unanimous action of all members of the Board of Directors then in office.

ARTICLE 5 – OFFICERS

Section 5.1 Officers of the Corporation. There shall be a Chief Executive 

Officer of the Corporation and a General Auditor. In the event of a vacancy in either office, 

such vacancy shall be addressed by resolution by the Board of Directors or an appropriate 

committee thereof. Other officers of the Corporation may include a President, a Chief 

Operating Officer, a Chief Compliance Officer, a Chief Risk Officer, one or more Vice 

Presidents (any one or more of whom may be designated Executive Vice President or 

Senior Vice President and may be given other descriptive titles), a Corporate Secretary 

and all other officers or assistant officers deemed necessary and desirable for the conduct 

of the Corporation’s business. Any of the above offices may be held by the same person, 

except that the office of the Corporate Secretary may not be held by the same person that 

holds the office of Chief Executive Officer, President, Chief Operating Officer or General 

Auditor.

Section 5.2 Appointment and Term.

(a) The Board of Directors shall elect the Chief Executive Officer.

(b) The Audit Committee of the Board of Directors shall elect the General 

Auditor.

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(c) Except as otherwise determined by the Board of Directors or provided 

herein, the Chief Executive Officer shall appoint all additional officers at the Executive Vice 

President and Senior Vice President level or above.

(d) Except as otherwise determined by the Board of Directors or provided 

herein, the Chief Executive Officer or his or her designee(s) (each individually an 

“Appointing Officer” and collectively the “Appointing Officers”) shall appoint all officers at 

the Vice President level and below, other than those identified in Sections 5.2 (a), (b) and 

(c).

(e) Except as provided herein, the appointment of a President and/or Chief 

Operating Officer, if one or both of such positions are to be filled, shall be subject to prior 

review by the Board of Directors.

(f) Any appointment by an Appointing Officer under this section is subject to 

the legal, regulatory or supervisory limitations, requirements and approvals that apply to 

appointments by the Board of Directors. Each officer elected by the Board of Directors or 

appointed by an Appointing Officer shall hold office until his or her successor is elected or 

appointed and qualified or until his or her death, resignation or removal as provided in this 

Article 5. Election or appointment of an officer shall not, in and of itself, create any contract 

rights in the officer against the Corporation.

Section 5.3 Removal, Resignation, Vacancy.

(a) Any officer may be removed, with or without cause, by a vote of the Board 

of Directors. The General Auditor may be removed, with or without cause, by a vote of the 

Audit Committee. Except as otherwise determined by these Bylaws or the Board of 

Directors, an Appointing Officer may remove, with or without cause, any officer he or she 

may appoint.

(b) Any officer may resign at any time by delivering a notice of resignation to 

the Corporation. A resignation shall be effective upon delivery unless the notice specifies a 

later effective time. If a resignation is made effective at a later time, the Board of Directors 

or the appropriate Appointing Officer may fill the pending vacancy before the effective time 

if the successor does not take office until the effective time. A vacancy in any office shall 

be filled in the manner prescribed in these Bylaws for election or appointment to such 

office.

Section 5.4 Compensation. The compensation of all officers of the Corporation 

shall be fixed by or under the authority of the Board of Directors. No officer shall be 

prevented from receiving such compensation by reason of the fact that such officer is also 

a director of the Corporation.

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Section 5.5 Duties. The officers of the Corporation shall have such powers and 

duties as are provided for in these Bylaws as well as such other authority as provided by 

the Board of Directors or, in the case of the officers other than the Chief Executive Officer, 

by the appropriate Appointing Officer.

Section 5.6 Chief Executive Officer. The Chief Executive Officer of the 

Corporation shall be primarily responsible for the implementation of the policies, orders 

and resolutions of the Board of Directors. Subject to the direction of the Board of 

Directors, he or she shall have general charge of and responsibility for supervision of the 

business and affairs of the Corporation. The Chief Executive Officer may sign and execute 

in the name of the Corporation all certificates, contracts and instruments. The Chief 

Executive Officer may vote stock in other corporations, in person or by proxy, and shall 

perform such other duties of management as may be commonly incident to the office of 

chief executive or as may be prescribed by resolution or as otherwise may be assigned to 

the Chief Executive Officer by the Board of Directors.

Section 5.7 President. The President shall perform such duties as from time to 

time may be assigned by the Board of Directors or the Chief Executive Officer.

Section 5.8 Chief Operating Officer. The Chief Operating Officer shall perform 

such duties as from time to time may be assigned by the Board of Directors or the Chief 

Executive Officer.

Section 5.9 General Auditor. The General Auditor shall report to, and be hired, 

supervised and terminated, if deemed appropriate, by the Audit Committee of the Board of 

Directors. The General Auditor shall be responsible for examining and evaluating the 

adequacy and effectiveness of the Corporation’s system of internal controls. The General 

Auditor shall perform such other duties as from time to time may be assigned by the Audit 

Committee of the Board of Directors.

Section 5.10 Vice Presidents. The Corporation shall have one or more Vice 

Presidents, which may include Executive Vice Presidents or Senior Vice Presidents, 

elected or appointed as herein provided. Each such Vice President shall have such duties 

as from time to time may be assigned to him or her by the Board of Directors, the 

appropriate Appointing Officer or the supervising officer to whom a Vice President reports 

directly or that are commonly incident to such Vice President’s office.

Section 5.11 Corporate Secretary. The Corporate Secretary shall keep the 

minutes of the meetings of the stockholders and of the Board of Directors and of 

committees of the Board of Directors and their subcommittees in books provided for that 

purpose; shall see that all notices of such meetings are duly given in accordance with the 

provisions of these Bylaws; may sign certificates of stock of the Corporation with the Chief 

Executive Officer; shall be custodian of the corporate seal; shall see that the corporate 

seal is affixed to all documents as appropriate; shall certify all documents pertaining to 

actions of the stockholders and the Board of Directors and any of its committees (and their 

subcommittees) and all other corporate documents and, in general, shall perform all duties

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and have all powers as may be commonly incident to the office of a secretary of a 

corporation, and such other duties as from time to time may be assigned to the Corporate 

Secretary by the Board of Directors or the Chief Executive Officer. The Corporate 

Secretary may appoint such Assistant Secretaries as he or she deems appropriate. The 

duties of the Corporate Secretary may be performed by one or more Assistant 

Secretaries.

Section 5.12 Delegation of Authority. Subject to the control of the Board of 

Directors, the functions delegated to the holder of a particular office pursuant to these 

Bylaws (the “Officer”) shall be performed by such holder, or under his or her direction, by 

such individuals as may from time to time be delegated authority to perform such functions 

by the Officer. A person to whom a function is delegated by the Board of Directors may 

further delegate that function to another person under his or her direction to the extent that 

such person is permitted to do so by the original delegation to him or her by the Board of 

Directors.

ARTICLE 6 – INSPECTION OF RECORDS

Section 6.1 Inspection of Records by Stockholders.

(a) The Corporation’s Bylaws and all amendments thereto, all Board of 

Directors resolutions creating one or more classes or series of shares and minutes of all 

stockholders’ meetings for the then most recent three years, all written communications to 

stockholders generally within the past three years (including all financial statements 

furnished for the past three years) and the names and business addresses of its current 

directors and officers shall be open to inspection at the Corporation’s principal office 

during its regular business hours upon written request therefor, received by the 

Corporation at least 10 business days prior to the date such inspection is requested, from 

any person who is a stockholder.

(b) Excerpts from the minutes of any meeting of the Board of Directors, records 

of any action of a committee of the Board of Directors (or a subcommittee of a committee) 

while acting in place of the Board of Directors on behalf of the Corporation, minutes of any 

meeting of the stockholders, and records of action taken by the Board of Directors without 

a meeting, to the extent not subject to inspection under Subsection (a), accounting 

records of the Corporation and the record of stockholders shall be open to inspection at a 

reasonable location specified by the Corporation during its regular business hours upon 

written request therefor, received by the Corporation at least 10 business days prior to the 

date such inspection is requested, provided that the request is made by a stockholder who 

has been a stockholder of record for at least six months immediately preceding such 

request or is the holder of record of at least five percent of all of the Corporation’s 

outstanding shares, and provided further that (i) such request is made in good faith and for 

a proper purpose, (ii) such request describes with reasonable particularity the purpose of 

such request and the records to be inspected, and (iii) the records requested are directly 

connected with his or her purpose. The stockholder’s written request shall be 

accompanied by (i) documentation to verify the class and number of shares of the

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Corporation that are beneficially owned by the stockholder in accordance with the Proxy 

Rules Requirements and (ii) proof of the stockholder’s ownership when making a request 

under this Subsection (b).

(c) Any inspection made pursuant to this Section may be made in person or by 

an agent or attorney and shall include the right to make copies, including copies through 

an electronic transmission if available and so requested by the stockholder. A request for 

any such inspection shall be served upon the Chief Executive Officer or the Corporate 

Secretary. This right of inspection is in addition to the stockholders’ right to inspect the 

stockholders’ list as provided in Section 3.10 of these Bylaws.

(d) For purposes of this Section, stockholder includes a beneficial owner whose 

shares are held in a voting trust or by a nominee on the stockholder’s behalf.

Section 6.2 Inspection of Records by Directors. A director of the 

Corporation is entitled to inspect and copy the books, records and documents of the 

Corporation at any reasonable time to the extent reasonably related to the performance of 

the director’s duties as a director, including duties as a member of a committee or a 

subcommittee, but not for any other purpose or in any manner that would violate any duty 

to the Corporation.

ARTICLE 7 – NOTICES

Section 7.1 Notices.

(a) Except as otherwise specifically provided in these Bylaws, all notices 

required to be given to any stockholder, director, officer, employee or agent shall be in 

writing, in the English language (unless otherwise agreed by the sender and the recipient) 

and may in every instance be effectively given by hand delivery; by mail or commercial 

courier; or by electronic transmission. Where these Bylaws expressly permit oral notice, 

such notice may be communicated in person, by telephone, voice mail or by other 

electronic means. If these forms of personal notice are impracticable, notice may be 

communicated by a newspaper of general circulation in the area where the notice is 

intended to be given or by radio, television or other form of public communication in the 

area where notice is intended to be given. In addition to the manner in which notices may 

be given under these Bylaws, notices may also be given as set forth in the Common Stock 

Certificate of Designation.

(b) Without limiting the manner by which notice otherwise may be given 

effectively to stockholders or directors, any notice to stockholders or directors given by the 

Corporation under these Bylaws shall be effective if given by a form of electronic 

transmission consented to by the stockholder or the director to whom notice is given, 

provided that it shall not be necessary to obtain consent to send notices of meetings of 

directors to directors by electronic transmission except to the extent required under 

Section 3.3(c)(y) of these Bylaws. In the case of stockholders’ meeting notices given to 

employee stockholders where such employees have regular access to electronic mail

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delivery in the course of their employment, consent to receipt of such notices by electronic 

transmission to the employee’s employment related e-mail address shall be implied unless 

and until the employee specifies a different address to which notices should be 

electronically transmitted or requests delivery of notice in print.

(c) Any consent to receive notices by electronic transmission shall be 

revocable by the stockholder or director by written notice to the Corporation. Any such 

consent shall be deemed revoked if (i) the Corporation is unable to deliver by electronic 

transmission two consecutive notices given by the Corporation in accordance with such 

consent and (ii) such inability becomes known to the Corporate Secretary or an Assistant 

Secretary of the Corporation or to the transfer agent or other person responsible for the 

giving of notice; provided however, that inadvertent failure to treat such inability as a 

revocation shall not invalidate any meeting or other action.

(d) Any such notice shall be addressed to such stockholder, director, officer, 

employee or agent at his or her last known address as the same appears on the books of 

the Corporation, or in the case of a notice given by electronic transmission, shall be sent 

to the address at which the stockholder or director has consented to receive notice or, in 

the case of notices of directors’ meetings delivered by electronic transmission, sent to an 

information processing system that the director has designated or uses for the purpose of 

receiving electronic transmissions.

(e) Notice to a stockholder, if given by mail or physical delivery, is effective (i) 

upon deposit in the United States mail or (ii) when the physical delivery is actually 

received or left at the stockholder’s address of record. Notice to persons other than 

stockholders, if given by physical delivery or mail, is effective at the earliest of the 

following (i) when it is actually received; (ii) five days after its deposit in the United States 

mail; (iii) on the date shown on the return receipt if sent by registered or certified mail, 

return receipt requested, and the receipt is signed by the addressee; (iv) in the case of 

notice to a director, when it is left at the director’s residence or usual place of business; or 

(v) in the case of notice to the Corporation, when it is left at the Corporation’s principal 

place of business or at the Corporation’s registered office when left with the Corporation’s 

registered agent.

(f) Oral notice is effective when communicated.

(g) Notice given by electronic transmission to a stockholder, director or other 

person, who has consented to receive notices by such means, or whose consent is not 

required under Subsection (b) of this Section, is effective when received. An electronic 

transmission is received when (i) it enters an information processing system that the 

recipient has designated or uses for the purpose of receiving electronic transmissions or 

information of the type sent, and from which the recipient is able to retrieve the electronic 

transmission and (ii) it is in a form capable of being processed by that system. An 

electronic transmission is received even if no individual is aware of its receipt.

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(h) The Corporation shall be deemed to have delivered notice of an annual or 

special meeting of stockholders who share a common address as shown on the 

Corporation’s current record of stockholders if (i) the Corporation delivers one meeting 

notice to the common address; (ii) the Corporation addresses the meeting notice (or a 

proxy statement, annual report, or notice of Internet availability of proxy materials 

containing such meeting notice)(collectively, the “Meeting Notice”) to those stockholders 

sharing a common address either as a group (for example, “Jane Doe and Household” or 

“The Smith Family”), to each of them individually (for example, “Jane Doe, John Doe and 

Richard Doe”) or to the stockholders in a form to which each of those stockholders has 

consented in writing; (iii) each of those stockholders consents, including any implied 

consent pursuant to Virginia Stock Corporation Act § 13.1-610.1(B), in accordance with 

procedures required by Rule 14a-3(e) of Regulation 14A (Solicitation of Proxies) under the 

Exchange Act of 1934, to the delivery of a single Meeting Notice to the stockholders’ 

common address; (iv) the Corporation delivers a separate proxy card for each stockholder 

at the common address; and (v) the Corporation includes in the Meeting Notice an 

undertaking to deliver promptly, upon written or oral request, a separate copy of the 

Meeting Notice to a stockholder at a common address to which a single copy of the 

Meeting Notice was delivered. If a stockholder, orally or in writing revokes a consent to 

delivery of one Meeting Notice to a common address, the Corporation shall begin 

providing individual notices to the revoking stockholder no later than 30 days after the 

Corporation receives revocation of the stockholder’s consent.

Section 7.2 Written Waivers. A written waiver of any notice, signed by a 

stockholder, director, officer, employee or agent, whether before or after the time of the 

event for which notice is to be given, shall be deemed equivalent to the notice required to 

be given to such stockholder, director, officer, employee or agent. Neither the business nor 

the purpose of any meeting need be specified in such a waiver.

ARTICLE 8 – INDEMNIFICATION AND LIMITATION OF LIABILITY

Section 8.1 Indemnification.

(a) Subject to the conditions set forth in Subsection (b) of this Section, each 

person who was or is made a party or is threatened to be made a party to any action, suit 

or proceeding, whether civil, criminal, administrative, arbitrative or investigative and 

whether formal or informal, including a derivative action or action brought by the 

Corporation (hereinafter, a “proceeding”), by reason of the fact that he or she is or was a 

director, officer or employee of the Corporation or is or was serving at the request of the 

Corporation as a director, officer, manager, partner, trustee, fiduciary, employee or agent 

of another corporation, limited liability company, partnership, joint venture, trust or other 

entity, including service with respect to an employee benefit plan (hereinafter, an 

“indemnitee”), shall be indemnified and held harmless by the Corporation against all 

liability (including the obligation to pay a judgment, settlement, penalty or fine, including 

any excise tax assessed with respect to an employee benefit plan) and expense (including 

attorneys’ fees) reasonably incurred or suffered by such indemnitee in connection 

therewith, except such liabilities and expenses as are incurred because of the 

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July 11, 2023

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indemnitee’s willful misconduct or knowing violation of criminal law or of any federal or 

state securities law, including, without limitation, any unlawful insider trading or the 

manipulation of the market for any security; provided, however, that the Corporation may 

not indemnify an indemnitee in connection with any proceeding charging improper 

personal benefit to the indemnitee, whether or not involving action in his or her official 

capacity, to the extent the indemnitee was adjudged liable on the basis that personal 

benefit was improperly received by the indemnitee. Such indemnification shall continue as 

to an indemnitee who has ceased to be a director, officer or employee and shall inure to 

the benefit of the indemnitee’s heirs, executors and administrators.

(b) Indemnification shall be made by the Corporation only as authorized in the 

specific case after a determination has been made as provided in Subsection (c) of this 

Section that the indemnitee met the relevant standard of conduct set forth in Subsection

(a) of this Section. The termination of a proceeding by judgment, order, settlement or 

conviction, or upon a plea of nolo contendere or its equivalent, is not, of itself, 

determinative that the indemnitee did not meet the standard of conduct set forth in 

Subsection (a) of this Section.

(c) The determination of whether the indemnitee met the standard of conduct 

set forth in Subsection (a) of this Section shall be made: (i) by the Board of Directors by a 

majority vote of a quorum consisting of directors not at the time parties to the proceeding; 

(ii) by a majority vote of a committee duly designated by the Board of Directors (in which 

designation directors who are parties may participate), consisting solely of two or more 

directors not at the time parties to the proceeding; (iii) by special legal counsel (1) selected 

by the Board of Directors or its committee in a manner prescribed in Subsection (c)(i) or 

(c)(ii) hereof, or (2) if a quorum of the Board of Directors cannot be obtained under 

Subsection (c)(i) hereof and a committee cannot be designated under Subsection (c)(ii) 

hereof, selected by a majority vote of the full Board of Directors (in which selection 

directors who are parties may participate); or (iv) by the stockholders, provided, however, 

that shares owned by or voted under the control of directors who are at the time parties to 

the proceeding may not be voted on the determination.

(d) Authorization of indemnification and evaluation as to reasonableness of 

expenses shall be made in the same manner as the determination that indemnification is 

permissible, as provided in Subsection (c) of this Section, provided however, that, if the 

determination is made by special legal counsel, authorization of indemnification and 

evaluation as to the reasonableness of expenses shall be made by those entitled under 

Subsection (c)(iii) of this Section to select such special legal counsel.

(e) Notwithstanding any other provision of this Section, the Corporation shall 

indemnify a director or indemnitee who entirely prevails, on the merits or otherwise, in the 

defense of any proceeding to which the indemnitee was a party because he or she is or 

was director or officer or employee of the Corporation or was serving at the request of the 

Corporation as a director, officer, manager, partner, trustee, fiduciary, employee or agent 

of another corporation, limited liability company, partnership, joint venture, trust or other 

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Page 26
entity, including service with respect to an employee benefit plan, against reasonable 

expenses (including attorneys’ fees) incurred by the indemnitee in connection with the 

proceeding.

(f) Except as provided in Section 8.2 of these Bylaws with respect to 

proceedings to enforce rights to indemnification, the Corporation shall indemnify an 

indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee 

only if such proceeding (or part thereof) was authorized by the Board of Directors.

(g) The rights to indemnification and liability limitation conferred in this Article 8 

shall be deemed a contract right between an individual indemnitee and the Corporation, 

and any subsequent repeal or modification of these Bylaws shall not diminish the 

indemnitee’s rights under this Article 8 with respect to any act or omission occurring before 

such amendment.

(h) The indemnitee shall have the right to be paid by the Corporation the 

expenses reasonably incurred or suffered in defending any proceeding in advance of its 

final disposition (hereinafter, an “advancement of expenses”); provided, however, that an 

advancement of expenses shall be made (i) only upon delivery to the Corporation of a 

written statement by the indemnitee of the indemnitee’s good faith belief that he or she 

has met the standard of conduct set forth in Subsection (a) of this Section, and (ii) only if 

the indemnitee furnishes to the Corporation a written undertaking, executed by or on 

behalf of such indemnitee, to repay any funds advanced if the indemnitee is not entitled to 

mandatory indemnification under Subsection (e) of this Section and it is ultimately 

determined that such indemnitee is not entitled to indemnification. The undertaking 

required by provision (h)(ii) of this Subsection shall be an unlimited general obligation of 

the indemnitee but need not be secured and shall be accepted without reference to the 

financial ability of the indemnitee to make repayment.

(i) The Corporation may, by action of its Board of Directors, provide 

indemnification to agents of the Corporation with the same scope and effect as the 

indemnification of indemnitees as provided in this Article 8.

(j) The Chief Executive Officer is authorized to enter into contracts of 

indemnification with each indemnitee of the Corporation with respect to the indemnification 

provided in this Article 8 and renegotiate such contracts as necessary to reflect changing 

laws and business circumstances.

Section 8.2 Right of Indemnitee to Bring Suit. If a claim under Section 8.1 of 

these Bylaws is not paid in full by the Corporation within 90 days after a written claim has 

been received by the Corporation, except in the case of a claim for an advancement of 

expenses, in which case the applicable period shall be 20 days, the indemnitee may at 

any time thereafter apply to either the United States District Court for the district within 

which the Corporation’s principal office is located or to the court where the proceeding is 

pending, if any, for an order directing the Corporation to make an advancement of

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Page 27
expenses or to provide indemnification. The court shall order the Corporation to make an 

advancement of expenses or to provide indemnification, as the case may be, if it 

determines that the indemnitee is entitled under these Bylaws to such an advancement of 

expenses or indemnification, and in such event shall order the Corporation to pay the 

indemnitee’s reasonable expenses (including attorneys’ fees) to obtain the order. Neither 

the failure of the Corporation (including its Board of Directors, committee, special legal 

counsel or its stockholders) to have made a determination, as provided in Subsection (c) 

of Section 8.1 of these Bylaws, prior to the commencement of such action permitted by 

this Section, that the indemnitee is entitled to receive an advancement of expenses or 

indemnification, nor the determination by the Corporation (including its Board of Directors, 

committee, special legal counsel or its stockholders) that the indemnitee is not entitled to 

an advancement of expenses or indemnification, shall create a presumption to that effect 

or otherwise itself be a defense to that indemnitee’s application for an advancement of 

expenses or indemnification.

Section 8.3 Non-Exclusivity of Rights. The rights to indemnification and to the 

advancement of expenses conferred in these Bylaws shall not be exclusive of any other 

right which any person may have or hereafter acquire under any statute (including the 

Corporation’s enabling legislation), or any agreement, vote of stockholders or 

disinterested directors or otherwise.

Section 8.4 Insurance. The Corporation may purchase and maintain insurance, 

at its expense, on behalf of itself and also on behalf of any individual who is or was a 

director, officer, employee or agent of the Corporation or who, while a director, officer, 

employee or agent of the Corporation, is or was serving at the request of the Corporation 

as a director, officer, manager, partner, trustee, employee, or agent of another corporation, 

limited liability company, partnership, joint venture, trust, employee benefit plan or other 

entity against any expense, liability or loss, asserted against or incurred or suffered by him 

or her in that capacity or arising from his or her status as a director, officer, manager, 

employee or agent, whether or not the Corporation would have the power to indemnify 

such person against such expense, liability or loss under this Article 8.

Section 8.5 Limitation of Liability. No monetary damages or monetary liability 

of any kind may be assessed against an officer or director in any proceeding brought by or 

in the right of the Corporation or brought by or on behalf of the stockholders of the 

Corporation; provided, however, that this elimination of liability shall not be applicable if 

the officer or director engaged in willful misconduct, a transaction from which the director 

or officer derived an improper personal benefit, or a knowing violation of the criminal law 

or of any federal or state securities law, including, without limitation, any claim of unlawful 

insider trading or the manipulation of the market for any security.

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ARTICLE 9 – SEAL

Section 9.1 Corporate Seal. The Board of Directors may adopt a suitable seal, 

containing the name of the Corporation, which seal shall be in the charge of the Corporate 

Secretary.

ARTICLE 10 – FISCAL YEAR

Section 10.1 Fiscal Year. The fiscal year of the Corporation shall be the 

calendar year.

ARTICLE 11 – MISCELLANEOUS

Section 11.1 Time Periods. In applying any provision of these Bylaws which 

requires that an act be done or not be done a specified number of days prior to an event 

or that an act be done during a period of a specified number of days prior to an event, 

calendar days shall be used in making such computations, the day of the doing of the act 

shall be excluded and the day of the event shall be included.

Section 11.2 Severability. If any provision or provisions of these Bylaws shall 

be held invalid or unenforceable for any reason whatsoever, the validity and enforceability 

of the remaining provisions shall not in any way be affected or impaired thereby and, to 

the fullest extent possible, the remaining provisions shall be construed so as to effectuate 

the intent manifested by the invalidated or unenforceable provision(s).

Section 11.3 Corporate Governance Practices and Procedures and 

Governing Law.

(a) The corporate governance practices and procedures of the Corporation 

shall comply with the Corporation’s enabling legislation and other Federal law, rules, and 

regulations, and shall be consistent with the safe and sound operation of the Corporation. 

To the extent not inconsistent with the foregoing, the Corporation shall follow the corporate 

governance practices and procedures of the law of the Commonwealth of Virginia, 

including without limitation the Virginia Stock Corporation Act as the same may be 

amended from time to time. Subject to all of the foregoing, these Bylaws and any rights 

and obligations created by these Bylaws shall be construed in accordance with, and 

governed by, the laws of the United States, using the law of the Commonwealth of Virginia 

as the federal rule of decision in all instances.

(b) Section 1.1, Section 2.1, Section 2.2, Section 2.3, Section 2.4, Section 2.5, 

Section 2.6, Section 2.7, Section 3.2, Section 3.7, Section 4.1, Section 4.2, Section 4.5, 

Section 4.17, Article 8, Section 11.3, Section 11.4, Section 11.6, Article 12 of these 

Bylaws, and any new bylaw which may be adopted from time to time and designated as a 

“Level 1 Provision” in accordance with Article 12 of these Bylaws shall collectively be 

referred to herein as “Level 1 Provisions.” Level 1 Provisions shall be deemed to 

constitute provisions of the Corporation’s “articles of incorporation” for all purposes of

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the Virginia Stock Corporation Act. Any bylaw that is not a Level 1 Provision and any new 

bylaw that may be adopted from time to time and is not designated as a “Level 1 

Provision” by the Board of Directors shall collectively be referred to herein as “Level 2 

Provisions.”

Section 11.4 Certificates of Designation. The provisions of these Bylaws shall 

supplement the terms of the Common Stock Certificate of Designation and any certificate 

of designation approved by the Board of Directors with respect to any class of the 

Corporation’s preferred stock. In the event of any conflict between the terms of any such 

certificate of designation and these Bylaws, the terms of the certificate of designation shall 

govern.

Section 11.5 Statutory References. Each reference in these Bylaws to a 

particular statute or regulation, or a provision thereof, is a reference to such provision as 

amended or re-enacted or as modified by other statutory provisions from time to time and 

includes subsequent legislation and regulations made under the relevant statute.

Section 11.6 Control Share Acquisitions. Article 14.1 of the Virginia Stock 

Corporation Act shall not apply to acquisitions of shares of the Corporation. This section 

has been included in these Bylaws for the avoidance of doubt as to whether the election of 

Virginia law in Section 11.3 and other sections of these Bylaws for purposes of the 

Corporation’s corporate governance practices and procedures was intended to include 

Article 14.1 of the Virginia Stock Corporation Act.

ARTICLE 12 – AMENDMENTS

Section 12.1 General. Subject to the provisions of this Article 12, Level 1 

Provisions or Level 2 Provisions may be amended, adopted, rescinded or repealed by the 

Board of Directors or the stockholders at any meeting, provided that in the case of such an 

action by the stockholders, notice of the proposed change must be given in the notice of 

the meeting.

Section 12.2 Amendment by the Board of Directors. Any new bylaw adopted 

by the Board of Directors and any Level 1 Provision, may be amended only by the Board 

of Directors pursuant to Section 12.1 of these Bylaws. Upon adopting or amending such 

bylaw, as the case may be, the Board of Directors shall designate such bylaw as a “Level 

1 Provision” for all purposes under these Bylaws. If the Board of Directors does not 

designate a bylaw as a Level 1 Provision or if the Board of Directors is otherwise silent on 

the designation, the bylaw shall be deemed to be a Level 2 Provision.

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Section 12.3 Amendment by the Stockholders. Notwithstanding any other 

provisions of these Bylaws, or any provisions of law, which might otherwise permit a lesser 

vote or no vote, but in addition to any affirmative vote of the stockholders required by law, 

the Common Stock Certificate of Designation, or these Bylaws, the affirmative vote of the 

holders of at least a majority of all shares of voting stock then outstanding and entitled to 

vote shall be required to amend, adopt, rescind or repeal any Level 2 Provision of these 

Bylaws (the “Proposed Level 2 Provision”); provided, however, that, as determined by the 

Board of Directors, (i) the Proposed Level 2 Provision shall comply with the Corporation’s 

enabling legislation and other Federal law, rules, regulations, regulatory guidance and 

other issuances, (ii) the Proposed Level 2 Provision shall be consistent with the safe and 

sound operation of the Corporation, (iii) the subject matter of the Proposed Level 2 

Provision does not or would not involve the subject matter of any Level 1 Provision, the 

Common Stock Certificate of Designation or any other certificate of designation of the 

Corporation, and (iv) the Proposed Level 2 Provision does not or would not be 

inconsistent with any Level 1 Provision, the Common Stock Certificate of Designation or 

any other certificate of designation of the Corporation. The stockholders may not amend, 

adopt, rescind or repeal any Level 1 Provision unless such action is explicitly authorized 

and referred to the stockholders by the Board of Directors (for the avoidance of doubt, this 

Section 12.3 in no way obligates the Board of Directors to seek stockholder approval for 

any action pursuant to Section 12.2 of these Bylaws) in which case such amendment, 

adoption, rescission, or repeal shall be by the affirmative vote of the holders of at least a 

majority of all shares of the voting stock then outstanding and entitled to vote.

Freddie Mac Bylaws

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Page 31
Exhibit 31.1

CERTIFICATION

PURSUANT TO SECURITIES EXCHANGE ACT RULE 13a-14(a)

I, Michael J. DeVito, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 of the Federal Home Loan Mortgage Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make 

the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered 

by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the 

financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in 

Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 

15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our 

supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by 

others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 

supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for 

external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the 

effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most 

recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely 

to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to 

the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are 

reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal 

control over financial reporting.

Date: August 2, 2023

/s/ Michael J. DeVito

Michael J. DeVito

Chief Executive Officer
Exhibit 31.2

CERTIFICATION

PURSUANT TO SECURITIES EXCHANGE ACT RULE 13a-14(a)

I, Christian M. Lown, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 of the Federal Home Loan Mortgage Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make 

the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered 

by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the 

financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in 

Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 

15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our 

supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by 

others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 

supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for 

external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the 

effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most 

recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely 

to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to 

the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are 

reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal 

control over financial reporting.

Date: August 2, 2023

/s/ Christian M. Lown

Christian M. Lown

Executive Vice President and Chief Financial Officer
Exhibit 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ENACTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 of the Federal Home Loan Mortgage Corporation (the 

"Company"), as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Michael J. DeVito, Chief Executive Officer of the 

Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 2, 2023

/s/ Michael J. DeVito

Michael J. DeVito

Chief Executive Officer
Exhibit 32.2

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ENACTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 of the Federal Home Loan Mortgage Corporation (the 

"Company"), as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Christian M. Lown, Executive Vice President and 

Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 

2002, that to my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 2, 2023

/s/ Christian M. Lown

Christian M. Lown

Executive Vice President and Chief Financial Officer