Freddie Mac’s credit risk transfer delivers record first
MCLEAN, Va., Aug. 30, 2022 (GLOBE NEWSWIRE) — Freddie Macit is The one-family business today announced that its Credit Risk Transfer (CRT) program announced a CRT issuance in the second quarter of 2022 of approximately $6.5 billion, protecting approximately $151 billion of principal balance unpaid (UPB) single family mortgages. The total was a record for a second quarter.
Additionally, record issuance in the first half of 2022 totaled nearly $15 billion, shielding UPB $358 billion in single-family mortgages. Shows included our flagship STACR® (Structured Agency Credit Risk) and ACIS® (Agency Credit Insurance Structure), as well as other risk-sharing operations.
“Freddie Mac’s Single-Family CRT program delivered record performance, introduced a new ACIS structure and reduced our costs through two STACR RFPs in the first half,” said Freddie Mac’s Mike Reynolds, Vice President of Single -Family CRT. “We added 17 new investors/(re)insurers in the second quarter, demonstrating continued market demand for our offerings and establishing the largest average investor base in program history.”
Through its flagship offerings alone, Freddie Mac issued approximately $14.6 billion across 6 STACR deals and 8 ACIS deals in the first half of 2022. Notable deals in the first half of the year included STACR 2022-DNA2. It was Freddie Mac’s largest CRT securities transaction ever, at $1.9 billion.
The first half of 2022 was the largest in program history for ACIS transactions and included a new ACIS structure. ACIS 2022-COR1, the first structure with guarantees consisting only of cash refinancing loans. The program also launched ACIS 2022-AFH1 in the second quarter, a structure that reduces Freddie Mac’s credit risk by protecting loans as they are purchased. Executed in June, ACIS 2022-AFH1 accelerated the placement of loans in an ACIS transaction by allowing underwriters to assess transaction collateral through a proxy pool of previously securitized loans.
Additionally, in the first half, the company executed two tender offers for certain STACR bonds. Over $4.5 billion in initial principal balance of Notes has been deposited and accepted. The Notes offered had significantly deleveraged and therefore no longer provided Freddie Mac with capital relief.
Since the first CRT transaction in 2013, Freddie Mac’s Single-Family CRT program has cumulatively transferred approximately $99.9 billion of credit risk on more than $3.0 trillion in mortgages through STACR and ACIS. As of June 30, 2022, approximately 59% of the single-family mortgage portfolio was covered by credit enhancement.
About Freddie Mac Single Family Credit Risk Transfer
Freddie Mac’s Single-Family CRT programs transfer credit risk from US taxpayers to global private capital through securities and (re)insurance policies, providing stability, liquidity and accessibility to the US real estate market. The GSE Single-Family CRT Marketplace was founded when Freddie Mac released the first STACR® (Structured Agency Credit Risk) note in July 2013. In November 2013, ACIS® (Agency Credit Insurance Structure®) has been presented. Today, the industry-leading and award-winning programs attract institutional investors and insurance and (re)insurance companies from around the world. For specific STACR and ACIS transaction data, visit Clarity Data IntelligenceSM.
About Freddie Mac
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our founding by Congress in 1970, we have made housing more accessible and affordable for buyers and renters in communities nationwide. We are building a better housing finance system for buyers, renters, lenders, investors and ratepayers. Learn more about FreddieMac.comTwitter @FreddieMac, and Freddie Mac’s blog FreddieMac.com/blog.
MEDIA CONTACT: Fred Salomon