Table of Contents

 Freddie Mac

FREDDIE MAC 

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 

Year Ended December 31, 

2014 2013 2012 

(in millions, except share-related amounts)

Interest income 

Mortgage loans: 

Held by consolidated trusts $ 57,036 $ 57,189 $ 65,089

Unsecuritized 6,569 7,694 8,960

Total mortgage loans 63,605 64,883 74,049

Investments in securities 5,843 7,768 10,583

Other 32 51 86

Total interest income 69,480 72,702 84,718

Interest expense 

Debt securities of consolidated trusts (48,003) (47,350) (56,109)

Other debt: 

Short-term debt (145) (178) (176)

Long-term debt (6,768) (8,251) (10,217)

Total interest expense (54,916) (55,779) (66,502)

Expense related to derivatives (301) (455) (605)

Net interest income 14,263 16,468 17,611

(Provision) benefit for credit losses (58) 2,465 (1,890)

Net interest income after (provision) benefit for credit losses 14,205 18,933 15,721

Non-interest income (loss) 

Gains (losses) on extinguishment of debt securities of consolidated trusts (451) 314 (58)

Gains (losses) on retirement of other debt 29 132 (77)

Derivative gains (losses) (8,291) 2,632 (2,448)

Impairment of available-for-sale securities: 

Total other-than-temporary impairment of available-for-sale securities (860) (763) (1,236)

Portion of other-than-temporary impairment recognized in AOCI (78) (747) (932)

Net impairment of available-for-sale securities recognized in earnings (938) (1,510) (2,168)

Other gains (losses) on investment securities recognized in earnings 1,494 301 (1,522)

Other income (loss) 8,044 6,650 2,190

Non-interest income (loss) (113) 8,519 (4,083)

Non-interest expense 

Salaries and employee benefits (914) (833) (810)

Professional services (527) (543) (361)

Occupancy expense (58) (54) (57)

Other administrative expense (382) (375) (333)

Total administrative expense (1,881) (1,805) (1,561)

Real estate owned operations (expense) income (196) 140 (59)

Temporary Payroll Tax Cut Continuation Act of 2011 expense (775) (533) (108)

Other (expense) income (238) 109 (465)

Non-interest expense (3,090) (2,089) (2,193)

Income before income tax (expense) benefit 11,002 25,363 9,445

Income tax (expense) benefit (3,312) 23,305 1,537

Net income 7,690 48,668 10,982

Other comprehensive income (loss), net of taxes and reclassification adjustments: 

Changes in unrealized gains (losses) related to available-for-sale securities 1,584 2,406 4,769

Changes in unrealized gains (losses) related to cash flow hedge relationships 197 316 414

Changes in defined benefit plans (45) 210 (126)

Total other comprehensive income (loss), net of taxes and reclassification adjustments 1,736 2,932 5,057

Comprehensive income $ 9,426 $ 51,600 $ 16,039

Net income $ 7,690 $ 48,668 $ 10,982

Undistributed net worth sweep and senior preferred stock dividends (10,026) (52,199) (13,056)

Net income (loss) attributable to common stockholders $ (2,336) $ (3,531) $ (2,074)

Net income (loss) per common share — basic and diluted $ (0.72) $ (1.09) $ (0.64)

Weighted average common shares outstanding (in millions) — basic and diluted 3,236 3,238 3,240

The accompanying notes are an integral part of these consolidated financial statements. 
Table of Contents

 Freddie Mac

FREDDIE MAC 

CONSOLIDATED BALANCE SHEETS 

December 31, 2014 December 31, 2013 

(in millions, 

except share-related amounts) 

Assets 

Cash and cash equivalents (includes $2 and $1, respectively, related to our consolidated VIEs) $ 10,928 $ 11,281

Restricted cash and cash equivalents (includes $8,532 and $12,193, respectively, related to our 

consolidated VIEs) 8,535 12,265

Federal funds sold and securities purchased under agreements to resell (includes $13,500 and 

$3,150, respectively, related to our consolidated VIEs) 51,903 62,383

Investments in securities: 

Available-for-sale, at fair value (includes $9 and $70, respectively, pledged as collateral that may 

be repledged) 106,550 128,919

Trading, at fair value (includes $1,884 and $365, respectively, pledged as collateral that may be 

repledged) 30,437 23,404

Total investments in securities 136,987 152,323

Mortgage loans: 

Held-for-investment, at amortized cost: 

By consolidated trusts (net of allowances for loan losses of $2,884 and $3,006, respectively) 1,558,094 1,529,905

Unsecuritized (net of allowances for loan losses of $18,877 and $21,612, respectively) 130,118 146,158

Total held-for-investment mortgage loans, net 1,688,212 1,676,063

Held-for-sale, at lower-of-cost-or-fair-value (includes $12,130 and $8,727 at fair value, 

respectively) 12,368 8,727

Total mortgage loans, net 1,700,580 1,684,790

Accrued interest receivable (includes $5,124 and $5,111, respectively, related to our consolidated 

VIEs) 6,034 6,150

Derivative assets, net 822 1,063

Real estate owned, net (includes $44 and $49, respectively, related to our consolidated VIEs) 2,558 4,551

Deferred tax assets, net 19,498 22,716

Other assets (Note 19) (includes $2,596 and $2,172, respectively, related to our consolidated VIEs) 7,694 8,539

Total assets $ 1,945,539 $ 1,966,061

Liabilities and equity Liabilities 

Accrued interest payable (includes $4,702 and $4,702, respectively, related to our consolidated 

VIEs) $ 6,325 $ 6,803

Debt, net: 

Debt securities of consolidated trusts held by third parties (includes $42 and $59 at fair value, 

respectively) 1,479,473 1,433,984

Other debt (includes $5,820 and $2,683 at fair value, respectively) 450,069 506,767

Total debt, net 1,929,542 1,940,751

Derivative liabilities, net 1,963 180

Other liabilities (Note 19) (includes $1 and $6, respectively, related to our consolidated VIEs) 5,058 5,492

Total liabilities 1,942,888 1,953,226

Commitments and contingencies (Notes 9, 14, and 17) 

Equity 

Senior preferred stock, at redemption value 72,336 72,336

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 

650,043,899 shares and 650,039,533 shares outstanding, respectively — —

Additional paid-in capital — —

Retained earnings (accumulated deficit) (81,639) (69,719)

AOCI, net of taxes, related to: 

Available-for-sale securities (includes $839 and ($1,100), respectively, related to net unrealized 

gains (losses) on securities for which other-than-temporary impairment has been recognized in 

earnings) 2,546 962

Cash flow hedge relationships (803) (1,000)

Defined benefit plans (13) 32

Total AOCI, net of taxes 1,730 (6)

Treasury stock, at cost, 75,819,987 shares and 75,824,353 shares, respectively (3,885) (3,885)

Total equity (See NOTE 11: STOCKHOLDERS’ EQUITY for information on our dividend 

obligation to Treasury) 2,651 12,835

Total liabilities and equity $ 1,945,539 $ 1,966,061

The accompanying notes are an integral part of these consolidated financial statements. 
Table of Contents

 Freddie Mac

FREDDIE MAC 

CONSOLIDATED STATEMENTS OF EQUITY 

Shares Outstanding Senior 

Preferred 

Stock, at 

Redemption Value 

Preferred 

Stock, at 

Redemption Value 

Common 

Stock, at 

Par Value 

Additional 

Paid-In 

Capital 

Retained 

Earnings 

(Accumulated 

Deficit) 

AOCI, 

Net of 

Tax 

Treasury 

Stock, at 

Cost 

Total 

Equity 

Senior 

Preferred 

Stock 

Preferred 

Stock 

Common 

Stock 

(in millions) 

Balance as of December 31, 2011 1 464 650 $ 72,171 $ 14,109 $ — $ 3 $ (74,525) $ (7,995) $ (3,909) $ (146)

Comprehensive income: Net income — — — — — — — 10,982 — — 10,982

Other comprehensive income, net of

taxes — — — — — — — — 5,057 — 5,057

Comprehensive income — — — — — — — 10,982 5,057 — 16,039

Increase in liquidation preference — — — 165 — — — — — — 165

Stock-based compensation — — — — — — 2 — — — 2

Income tax benefit from stock-based compensation — — — — — — 1 — — — 1

Common stock issuances — — — — — — (24) — — 24 —

Transfer from retained earnings 

(accumulated deficit) to additional paidin capital — — — — — — 19 (19) — — —

Senior preferred stock dividends declared — — — — — — — (7,233) — — (7,233)

Dividend equivalent payments on expired stock options — — — — — — — (1) — — (1)

Ending balance as of December 31, 

2012 1 464 650 $ 72,336 $ 14,109 $ — $ 1 $ (70,796) $ (2,938) $ (3,885) $ 8,827

Balance as of December 31, 2012 1 464 650 $ 72,336 $ 14,109 $ — $ 1 $ (70,796) $ (2,938) $ (3,885) $ 8,827

Comprehensive income: 

Net income — — — — — — — 48,668 — — 48,668

Other comprehensive income, net of 

taxes — — — — — — — — 2,932 — 2,932

Comprehensive income — — — — — — — 48,668 2,932 — 51,600

Common stock issuances — — — — — — (1) — — — (1)

Senior preferred stock dividends declared — — — — — — — (47,591) — — (47,591)

Ending balance at December 31, 2013 1 464 650 $ 72,336 $ 14,109 $ — $ — $ (69,719) $ (6) $ (3,885) $ 12,835

Balance as of December 31, 2013 1 464 650 $ 72,336 $ 14,109 $ — $ — $ (69,719) $ (6) $ (3,885) $ 12,835

Comprehensive income: 

Net income — — — — — — — 7,690 — — 7,690

Other comprehensive income, net of 

taxes — — — — — — — — 1,736 — 1,736

Comprehensive income — — — — — — — 7,690 1,736 — 9,426

Senior preferred stock dividends declared — — — — — — — (19,610) — — (19,610)

Ending balance at December 31, 2014 1 464 650 $ 72,336 $ 14,109 $ — $ — $ (81,639) $ 1,730 $ (3,885) $ 2,651

The accompanying notes are an integral part of these consolidated financial statements.