Page 48 - September October 2018 Disruption Report Flip Book

FREDDIE MAC SEJPATN.U-AORCYT.20210818
FREDDIE MAC
Ten years of transformation at Freddie Mac
I I n n t t h h e e t t h h i i r r d d q q u u a a r r t t e e r r , , F F r r e e d d d d i i e e M M a a c c r r e e p p o o r r t t e e d d $ $ 2 2 . . 7 7 b b i i l l l l i i o o n n , , w w h h i i c c h h b b e e n n e e fifi t t e e d d f f r r o o m m a a $ $ 2 2 0 0 0 0 m m i i l l l l i i o o n n n n e e t t
b b e e n n e e fifi t t f f r r o o m m s s i i n n g g l l e e - - f f a a m m i i l l y y l l e e g g a a c c y y a a s s s s e e t t d d i i s s p p o o s s i i t t i i o o n n s s a a n n d d $ $ 2 2 0 0 0 0 m m i i l l l l i i o o n n b b e e n n e e fifi t t f f r r o o m m t t h h e e w w r r i i t t e e - - d d o o w w n n o o f f net deferred tax assets, resulting from tax reform legislation. “Market-related items, such as interest rates and market spreads, had a near-zero impact,” wrote Freddie Mac.
Freddie Mac Third Quarter 2018 Financial Results October 31, 2018
SUMMARY OF CONSOLIDATED STATEMENTS OF
Page 13
COMPRESHENSIVE INCOME
FREDDIE MAC
C(UonndeanusediCteondso)lidated Statements of Comprehensive Income (Loss) (Unaudited)
(Dollars in millions, except share-related amounts)
3Q 2018
2Q 2018
3Q 2017
Interest income
Mortgage loans Investments in securities Other
$16,787 $16,344 $15,867 755 730 821 261 228 185
Total interest income 17,803 17,302 16,873
Interest expense (14,546) (14,299) (13,384)
Net interest income 3,257 3,003 3,489
Benefit (provision) for credit losses 380 60 (716)
Net interest income after benefit (provision) for credit losses 3,637 3,063 2,773
Non-interest income (loss)
Gains (losses) on extinguishment of debt
Derivative gains (losses)
Net impairment of available-for-sale securities recognized in earnings Other gains (losses) on investment securities recognized in earnings Other income (loss)
146 147 27 728 416 (678) (2) (1) (1)
(441) (348) 723 394 1,011 5,403
Non-interest income (loss) 825 1,225 5,474
Non-interest expense
Salaries and employee benefits Professional services
Other administrative expense
(301) (303) (120) (113) (148) (142)
(272) (110) (142)
Total administrative expense (569) (558) (524)
Real estate owned operations expense
Temporary Payroll Tax Cut Continuation Act of 2011 expense Other expense
(38) (375) (218)
(15) (366) (204)
(35) (339) (159)
Non-interest expense (1,200) (1,143) (1,057)
Income (loss) before income tax (expense) benefit 3,262 3,145 7,190 Income tax (expense) benefit (556) (642) (2,519)
Net income (loss) 2,706 2,503 4,671
Other comprehensive income (loss), net of taxes and reclassification adjustments:
Changes in unrealized gains (losses) related to available-for-sale securities (169) (96) (47)
Changes in unrealized gains (losses) related to cash flow hedge relationships 25 32 26
Freddie Mac reported strong business fundamentals that stimulated grow in the third quarter. The
Changes in defined benefit plans (3) (4) —
enterprise’s total guarantee portfolio grew 6% to $2.1 trillion, while its single-family total originations
Total other comprehensive income (loss), net of taxes and reclassification
(147) (68) (21)
adjustments
decreased 6% to $231 billion. Although the company’s refinance volume decreased 30%, Freddie
Comprehensive income (loss)
$2,559
$2,435
$4,650
Net income (loss)
Undistributed net worth sweep and senior preferred stock dividends
Net income (loss) attributable to common stockholders
$2,706 (2,559)
$147
$0.05 3,234
$2,503 (1,585)
$918
$0.28 3,234
$4,671 (4,650)
$21
Net income (loss) per common share — basic and diluted
$0.01
© 2018 by Canfield Press, LLC. All rights reserved. www.canfieldpress.com
48
Weighted average common shares outstanding (in millions) — basic and diluted
3,234