Freddie Mac Multifamily Launches K-Deal® Program On Issue Date
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MCLEAN, Virginia, September 08, 2021 (GLOBE NEWSWIRE) – Freddie Mac (OTCQB: FMCC) Multifamily today announced that it will soon be released with its inaugural When-Issued K-Deal® (WI K-Deal) offering which is backed first by cash collateral, then by newly issued AM certificates purchased from a referenced fixed rate K-Deal. Freddie Mac anticipates that the new issuance of K-Deal AM certificates will only be available to investors through the WI K-Deal program.
“The WI K-Deal program offers investors a new way to gain exposure to our AM bond class prior to issuance of K-Deal,” said Robert Koontz, senior vice president of capital markets for Freddie Mac Multifamily. “It also allows us to transfer market risk while pooling collateral for K-Deals. As a result, the new program will reduce our need to hedge spread risk, which will help reduce inefficiency and further optimize our executions. ”
Investors provide the initial cash collateral for the WI K-Deal Trust Certificates. After a period not exceeding 90 days, WI K-Deal Trust will purchase the newly issued K-Deal AM Certificates and provide investors with the option of exchanging their WI K-Deal Trust Certificates for K-Deal AM Certificates.
WI K-Deal Trust Certificates are funded investments, which settle shortly after the WI K-Deal Offer Period. The certificates are negotiable shortly after the WI K-Deal price is fixed and are government securities backed by the Freddie Mac collateral. The fixed rate coupon of the WI K-Deal trust certificates will be identical to that of the referenced K-Deal AM class, and they will be sized to approximately correspond to a referenced K-Deal AM class.
Freddie Mac has posted an Investor Presentation and FAQ providing additional details on the WI K-Deal program.
Freddie Mac Multifamily is one of the leading issuers of structured multifamily agency guaranteed securities. The K-Deals are part of the company’s business strategy to transfer part of the risk of losses to taxpayers and private investors who buy the unsecured subordinated bonds. K-Deal Certificates generally offer a wide range of options for investors with stable cash flow and structured credit enhancement.
This announcement does not constitute an offer to sell any Freddie Mac securities. Offers for any given security are only made through the applicable offering circulars and related supplements, which incorporate Freddie Mac’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission (SEC) on February 11. 2021; all other reports filed by Freddie Mac with the SEC in accordance with Section 13 (a) of the Securities Exchange Act of 1934 (Exchange Act) since December 31, 2020, excluding any information “provided” to the SEC on Form 8-K; and all documents that Freddie Mac files with the SEC in accordance with Sections 13 (a), 13 (c) or 14 of the Exchange Act, excluding any information “provided” to the SEC on Form 8- K.
Freddie Mac’s press releases sometimes contain forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties, some of which are beyond the control of the company. Management’s expectations for the future of the Company necessarily involve a number of assumptions, judgments and estimates, and various factors could cause actual results to differ materially from the expectations expressed in these forward-looking statements and ‘others. These assumptions, judgments, estimates and factors are discussed in the company’s annual report on Form 10-K for the year ended December 31, 2020, and its reports on Forms 10-Q and 8-K, which are available. on the Investor Relations website. Company website page at www.FreddieMac.com/investors and SEC website at www.sec.gov. The company makes no commitment to update any forward-looking statements it makes to reflect events or circumstances occurring after the date of this press release. The Multi-Family Investors section of the Company’s website at https://mf.freddiemac.com/investors/ will also be updated, from time to time, with any information on significant developments or other events. that may be important to investors, and we encourage investors to periodically access this website for such updated information.
The financial and other information contained in the documents accessible on this page are only valid as of the date of these documents. The information could be out of date and no longer accurate. Freddie Mac assumes no obligation, and disclaims any duty, to update the information contained in these documents.
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our inception by Congress in 1970, we’ve made housing more accessible and affordable for buyers and renters in communities across the country. We are building a better housing finance system for buyers, tenants, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac, and Freddie Mac’s blog FreddieMac.com/blog.
MEDIA CONTACT: Mike Morosi(703) 918-5851[email protected]
Source: Freddie Mac