%PDF-1.5 1 0 obj <> endobj 3 0 obj <> endobj 4 0 obj <> stream BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 144.65 748.15 Td (UNITED STATES SECURITIES AND EXCHANGE COMMISSION) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 244.10 734.95 Td (Washington, D.C. 20549) Tj ET Q BT /F1 16.00 Tf ET q 0 0 0 rg BT 261.80 709.75 Td (FORM?0-K) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 173.30 694.75 Td (ANNUAL REPORT PURSUANT TO SECTION?3 OR 15\(d\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 194.80 682.75 Td (OF THE SECURITIES EXCHANGE ACT OF 1934) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 200.35 667.75 Td (For the fiscal year ended December?1, 2018) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 218.85 652.75 Td (Commission File Number: 001-34139) Tj ET Q /GS0 gs q 153.00 0 0 34.00 229.50 604.75 cm /I1 Do Q BT /F2 11.00 Tf ET BT /F1 16.00 Tf ET q 0 0 0 rg BT 144.60 579.55 Td (Federal Home Loan Mortgage Corporation) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 181.30 563.35 Td (\(Exact name of registrant as specified in its charter\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 61.00 543.21 Td (Federally chartered) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 160.50 543.21 Td (? Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 171.40 537.71 Td (52-0904874) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 244.85 543.21 Td (8200 Jones Branch Drive) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.40 537.71 Td (22102-3110) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 443.50 543.21 Td (? Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.80 537.71 Td (\(703\)?03-2000) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 79.20 530.21 Td (corporation) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 160.50 530.21 Td (? Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 264.35 530.21 Td (McLean, Virginia) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 443.50 530.21 Td (? Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 65.05 518.64 Td (\(State or other jurisdiction of) Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 63.75 510.64 Td (incorporation or organization\)) Tj ET Q BT /F5 8.00 Tf ET q 0 0 0 rg BT 160.50 515.14 Td (? Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 175.00 518.64 Td (\(I.R.S. Employer) Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 172.65 510.64 Td (Identification No.\)) Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 247.20 515.14 Td (\(Address of principal executive offices\)) Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 394.60 515.14 Td (\(Zip Code\)) Tj ET Q BT /F5 8.00 Tf ET q 0 0 0 rg BT 443.50 515.14 Td (? Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 454.95 518.64 Td (\(Registrant's telephone number,) Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 472.10 510.64 Td (including area code\)) Tj ET Q BT /F2 11.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 155.45 492.35 Td (Securities registered pursuant to Section?2\(b\) of the Act: None) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 169.45 477.35 Td (Securities registered pursuant to Section?2\(g\) of the Act:) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 207.00 462.35 Td (Voting Common Stock, no par value per share \(OTCQB: FMCC\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 163.30 453.95 Td (Variable Rate, Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCI\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 178.20 445.55 Td (5% Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCKK\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 161.55 437.15 Td (Variable Rate, Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCG\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 174.90 428.75 Td (5.1% Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCH\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 173.15 420.35 Td (5.79% Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCK\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 162.30 411.95 Td (Variable Rate, Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCL\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 161.15 403.55 Td (Variable Rate, Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCM\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 161.70 395.15 Td (Variable Rate, Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCN\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 172.80 386.75 Td (5.81% Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCO\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 178.10 378.35 Td (6% Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCP\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 162.40 369.95 Td (Variable Rate, Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCCJ\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 175.35 361.55 Td (5.7% Non-Cumulative Preferred Stock, par value $1.00 per share \(OTCQB: FMCKP\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 146.15 353.15 Td (Variable Rate, Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCCS\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 157.75 344.75 Td (6.42% Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCCT\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 159.25 336.35 Td (5.9% Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCKO\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 156.80 327.95 Td (5.57% Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCKM\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 157.35 319.55 Td (5.66% Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCKN\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 157.95 311.15 Td (6.02% Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCKL\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 158.95 302.75 Td (6.55% Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCKI\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 133.40 294.35 Td (Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, par value $1.00 per share \(OTCQB: FMCKJ\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 281.55 Td (Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule?05 of the Securities Act. Yes?) Tj ET Q /GS0 gs q 6.24 0 0 8.00 430.91 279.55 cm /I2 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 437.15 281.55 Td ( No? Tj ET Q /GS0 gs q 7.42 0 0 8.00 450.11 279.55 cm /I3 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 268.75 Td (Indicate by check mark if the registrant is not required to file reports pursuant to Section?3 or Section?5\(d\) of the Act. Yes? Tj ET Q /GS0 gs q 6.24 0 0 8.00 434.38 266.75 cm /I4 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 440.62 268.75 Td ( No? Tj ET Q /GS0 gs q 7.42 0 0 8.00 453.58 266.75 cm /I5 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 255.95 Td (Indicate by check mark whether the registrant: \(1\) has filed all reports required to be filed by Section?3 or 15\(d\) of the Securities Exchange Act of 1934 during the ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 247.55 Td (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 ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 239.15 Td (past 90 days. ) Tj ET Q /GS0 gs q 7.42 0 0 8.00 93.59 237.15 cm /I6 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 101.01 239.15 Td (  Yes?) Tj ET Q /GS0 gs q 6.24 0 0 8.00 119.86 237.15 cm /I7 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 126.10 239.15 Td ( No? Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 226.35 Td (Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule?05 of Regulation S-) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 217.95 Td (T \(?32.405 of this chapter\) during the preceding 12 months \(or for such shorter period that the registrant was required to submit such files\).? Tj ET Q /GS0 gs q 7.42 0 0 8.00 487.90 215.95 cm /I8 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 495.32 217.95 Td (  Yes?) Tj ET Q /GS0 gs q 6.24 0 0 8.00 514.17 215.95 cm /I9 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 520.41 217.95 Td ( No  ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 205.15 Td (Indicate by check mark if disclosure of delinquent filers pursuant to Item?05 of Regulation S-K is not contained herein, and will not be contained, to the best of ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 196.75 Td (registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form?0-K or any amendment to this Form?0-K. ? Tj ET Q /GS0 gs q 7.42 0 0 8.00 551.67 194.75 cm /I10 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 183.95 Td (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 ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 175.55 Td (growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule?2b-2 of ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 167.15 Td (the Exchange Act.) Tj ET Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 52.50 149.15 Td (? Tj ET Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 91.50 149.15 Td (? Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 107.50 149.15 Td (Large accelerated filer? Tj ET Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 178.54 149.15 Td (? Tj ET Q /GS0 gs q 7.42 0 0 8.00 180.22 147.15 cm /I11 Do Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 258.50 149.15 Td (? Tj ET Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 287.50 149.15 Td (? Tj ET Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 429.50 149.15 Td (? Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 445.50 149.15 Td (Accelerated filer  ? Tj ET Q /GS0 gs q 6.24 0 0 8.00 501.63 147.15 cm /I12 Do Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 52.50 137.15 Td (? Tj ET Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 91.50 137.15 Td (? Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 107.50 137.15 Td (Non-accelerated filer  ) Tj ET Q /GS0 gs q 6.24 0 0 8.00 176.60 135.15 cm /I13 Do Q BT /F5 7.00 Tf ET q 0 0 0 rg BT 429.50 137.15 Td (? Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 445.50 137.15 Td (Smaller reporting company  ? Tj ET Q /GS0 gs q 6.24 0 0 8.00 535.91 135.15 cm /I14 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 107.50 125.15 Td (Emerging growth company ? Tj ET Q /GS0 gs q 6.24 0 0 8.00 195.67 123.15 cm /I15 Do Q BT /F2 11.00 Tf ET BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 109.75 Td (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 ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 101.35 Td (financial accounting standards provided pursuant to Section 13\(a\) of the Exchange Act. ) Tj ET Q /GS0 gs q 6.24 0 0 8.00 325.85 99.35 cm /I16 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 89.95 Td (Indicate by check mark whether the registrant is a shell company \(as defined in Rule?2b-2 of the Exchange Act\). Yes?) Tj ET Q /GS0 gs q 6.24 0 0 8.00 418.18 87.95 cm /I17 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 424.41 89.95 Td ( No?) Tj ET Q /GS0 gs q 7.42 0 0 8.00 439.32 87.95 cm /I18 Do Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 78.55 Td (The aggregate market value of the common stock held by non-affiliates computed by reference to the price at which the common equity was last sold on June?9, ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 70.15 Td (2018 \(the last business day of the registrant's most recently completed second fiscal quarter\) was $1.0 billion.) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 49.50 58.75 Td (As of February?, 2019, there were ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 158.89 58.75 Td (650,058,775) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 197.81 58.75 Td ( shares of the registrant's common stock outstanding.) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 49.50 44.95 Td (DOCUMENTS INCORPORATED BY REFERENCE) Tj ET Q BT /F2 9.00 Tf ET q 0 0 0 rg BT 255.27 44.95 Td (: None) Tj ET Q endstream endobj 5 0 obj <><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><>] /Rotate 0 /Contents 6 0 R>> endobj 6 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 47 759 m 231 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 231 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 764.07 Td (Table of Contents) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 556.65 28.07 Td (i) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 32.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 50.00 726.20 Td (Table of Contents) Tj ET Q BT /F7 12.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 53.00 704.63 Td (INTRODUCTION) Tj ET Q BT /F7 12.00 Tf ET /GS0 gs q 7.47 0 0 10.76 53.00 688.44 cm /I19 Do Q BT /F6 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 60.47 690.49 Td ( ) Tj ET Q BT /F6 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 71.00 690.49 Td (About Freddie Mac) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 675.44 cm /I20 Do Q BT /F6 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 60.47 677.49 Td ( ) Tj ET Q BT /F6 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 71.00 677.49 Td (Our Business) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 662.44 cm /I21 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 664.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 664.49 Td (Forward-Looking Statements) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 645.63 Td (SELECTED FINANCIAL DATA) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 629.63 Td (MANAGEMENT'S DISCUSSION AND ANALYSIS OF) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 617.63 Td (FINANCIAL CONDITION AND RESULTS OF OPERATIONS) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 601.44 cm /I22 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 603.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 603.49 Td (Key Economic Indicators) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 588.44 cm /I23 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 590.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 590.49 Td (Consolidated Results of Operations) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 575.44 cm /I24 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 577.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 577.49 Td (Consolidated Balance Sheets Analysis) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 562.44 cm /I25 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 564.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 564.49 Td (Our Business Segments) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 549.44 cm /I26 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 551.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 551.49 Td (Risk Management) Tj ET Q /GS0 gs q 6.72 0 0 9.78 71.00 537.42 cm /I27 Do Q BT /F6 9.00 Tf ET q 0 0 0 rg BT 77.72 539.26 Td ( ) Tj ET Q BT /F8 9.00 Tf ET q 0 0 0 rg BT 84.50 539.26 Td (Credit Risk) Tj ET Q /GS0 gs q 6.72 0 0 9.78 71.00 525.42 cm /I28 Do Q BT /F8 9.00 Tf ET q 0 0 0 rg BT 77.72 527.26 Td ( ) Tj ET Q q 0 0 0 rg BT 84.50 527.26 Td (Operational Risk) Tj ET Q /GS0 gs q 6.72 0 0 9.78 71.00 513.42 cm /I29 Do Q BT /F8 9.00 Tf ET q 0 0 0 rg BT 77.72 515.26 Td ( ) Tj ET Q q 0 0 0 rg BT 84.50 515.26 Td (Market Risk) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 500.44 cm /I30 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 502.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 502.49 Td (Liquidity and Capital Resources) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 487.44 cm /I31 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 489.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 489.49 Td (Conservatorship and Related Matters) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 474.44 cm /I32 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 476.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 476.49 Td (Regulation and Supervision) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 461.44 cm /I33 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 463.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 463.49 Td (Contractual Obligations) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 448.44 cm /I34 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 450.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 450.49 Td (Off-Balance Sheet Arrangements) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 435.44 cm /I35 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 437.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 437.49 Td (Critical Accounting Policies and Estimates) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 418.63 Td (RISK FACTORS) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 402.63 Td (LEGAL PROCEEDINGS) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 386.63 Td (MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 374.63 Td (MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 357.63 Td (FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 341.63 Td (QUARTERLY SELECTED FINANCIAL DATA) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 325.63 Td (CONTROLS AND PROCEDURES) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 309.63 Td (DIRECTORS, CORPORATE GOVERNANCE, AND EXECUTIVE OFFICERS) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 293.44 cm /I36 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 295.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 295.49 Td (Directors) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 280.44 cm /I37 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 282.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 282.49 Td (Corporate Governance) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 267.44 cm /I38 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 269.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 269.49 Td (Executive Officers) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 250.63 Td (EXECUTIVE COMPENSATION) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 234.44 cm /I39 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 236.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 236.49 Td (Compensation Discussion and Analysis) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 221.44 cm /I40 Do Q BT /F6 10.00 Tf ET q 0 0 0 rg BT 60.47 223.49 Td ( ) Tj ET Q q 0 0 0 rg BT 71.00 223.49 Td (Compensation and Risk) Tj ET Q /GS0 gs q 7.47 0 0 10.76 53.00 208.44 cm /I41 Do Q BT 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73.63 Td (SIGNATURES) Tj ET Q BT /F7 12.00 Tf ET q 0 0 0 rg BT 53.00 57.63 Td (FORM 10-K INDEX) Tj ET Q BT /F2 11.00 Tf ET BT /F7 12.00 Tf ET q 0 0 0 rg BT 537.95 704.63 Td (1) Tj ET Q BT /F7 12.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 539.20 691.06 Td (1) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 539.20 678.06 Td (6) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 539.20 663.56 Td (9) Tj ET Q BT /F6 10.00 Tf ET BT /F7 12.00 Tf ET q 0 0 0 rg BT 533.95 645.63 Td (11) Tj ET Q BT /F7 12.00 Tf ET BT /F7 12.00 Tf ET q 0 0 0 rg BT 533.95 624.63 Td (12) Tj ET Q BT /F7 12.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 536.40 604.06 Td (12) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 536.40 591.06 Td (15) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 536.40 578.06 Td (27) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 536.40 565.06 Td (28) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 536.40 552.06 Td (87) Tj ET Q BT /F6 10.00 Tf ET BT /F8 10.00 Tf ET q 0 0 0 rg BT 536.40 539.06 Td (90) Tj ET Q BT /F8 10.00 Tf ET BT /F8 9.00 Tf ET q 0 0 0 rg BT 534.45 527.77 Td (133) Tj ET Q BT /F8 9.00 Tf ET BT /F8 9.00 Tf ET q 0 0 0 rg BT 534.45 515.77 Td (136) Tj ET Q BT /F8 9.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 503.06 Td (145) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 490.06 Td (161) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 477.06 Td (168) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 464.06 Td (175) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 451.06 Td (177) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 436.56 Td (179) Tj ET Q BT /F6 10.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 419.35 Td (181) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 403.35 Td (209) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 380.85 Td (210) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 358.35 Td (211) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 342.35 Td (339) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 326.35 Td (341) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 310.35 Td (345) Tj ET Q BT /F7 11.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 296.06 Td (345) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 283.06 Td (354) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 268.56 Td (364) Tj ET Q BT /F6 10.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 251.35 Td (367) Tj ET Q BT /F7 11.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 237.06 Td (367) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 224.06 Td (384) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 211.06 Td (385) Tj ET Q BT /F6 10.00 Tf ET BT /F6 10.00 Tf ET q 0 0 0 rg BT 533.65 198.06 Td (386) Tj ET Q BT /F6 10.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 176.85 Td (393) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 154.35 Td (396) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 138.35 Td (399) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 122.35 Td (401) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 106.35 Td (402) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 90.35 Td (415) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 74.35 Td (421) Tj ET Q BT /F7 11.00 Tf ET BT /F7 11.00 Tf ET q 0 0 0 rg BT 530.95 58.35 Td (423) Tj ET Q BT /F7 11.00 Tf ET endstream endobj 7 0 obj <><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><>] /Rotate 0 /Contents 8 0 R>> endobj 8 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 48.75 759 m 246.75 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 246.75 759 m 562.75 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 51.25 764.07 Td (Table of Contents) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 488.20 764.07 Td (MD&A Table Index) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.80 30.07 Td (ii) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F7 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0.7803921568627451 rg /GS0 gs 49.00 121.80 32.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 81.00 121.80 445.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 526.00 121.80 36.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.00 93.80 32.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 81.00 93.80 445.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 526.00 93.80 36.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.00 65.80 32.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 81.00 65.80 445.00 -14.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 526.00 65.80 36.00 -14.00 re f /GS0 gs BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 56.5 699.90986328125 m 77.5 699.90986328125 l s q 0 0 0 rg BT 56.50 701.16 Td (Table) Tj ET Q BT /F9 10.00 Tf ET 0 0 0 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 83.5 699.90986328125 m 128.82958984375 699.90986328125 l s q 0 0 0 rg BT 83.50 701.16 Td (Description) Tj ET Q BT /F9 10.00 Tf ET 0 0 0 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 533.65 699.90986328125 m 553.25986328125 699.90986328125 l s q 0 0 0 rg BT 533.65 701.16 Td (Page) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 686.16 Td (1) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 686.16 Td (Selected Financial Data) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 672.16 Td (2) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 672.16 Td ( Summary of Consolidated Statements of Comprehensive Income \(Loss\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 658.16 Td (3) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 658.16 Td (Components of Net Interest Income) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 644.16 Td (4) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 644.16 Td (Analysis of Net Interest Yield) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 630.16 Td (5) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 630.16 Td (Net Interest Income Rate / Volume Analysis) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 616.16 Td (6) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 616.16 Td (Components of Mortgage Loans Gains \(Losses\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 602.16 Td (7) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 602.16 Td (Components of Investment Securities Gains \(Losses\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 588.16 Td (8) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 588.16 Td (Components of Debt Gains \(Losses\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 72.70 574.16 Td (9) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 574.16 Td (Components of Derivative Gains \(Losses\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 560.16 Td (10) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 560.16 Td (Other Comprehensive Income \(Loss\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 546.16 Td (11) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 546.16 Td (Summarized Consolidated Balance Sheets) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 532.16 Td (12) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 532.16 Td (Single-Family Credit Guarantee Portfolio CRT Issuance) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 518.16 Td (13) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 518.16 Td (Single-Family Guarantee Segment Financial Results) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 504.16 Td (14) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 504.16 Td (Multifamily Market Support) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 490.16 Td (15) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 490.16 Td (Multifamily Segment Financial Results) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 476.16 Td (16) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 476.16 Td (Capital Markets Segment Financial Results) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 462.16 Td (17) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 462.16 Td (Capital Markets Segment Interest Rate-Related and Market Spread-Related Fair Value Changes, Net of Tax) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 448.16 Td (18) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 448.16 Td (All Other Category Comprehensive Income) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 434.16 Td (19) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 434.16 Td (Single-Family New Business Activity) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 420.16 Td (20) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 420.16 Td (Relief Refinance Loan Purchases) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 406.16 Td (21) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 406.16 Td (Details of Credit Enhanced Loans in Our Single-Family Credit Guarantee Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 392.16 Td (22) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 392.16 Td (Non-Credit-Enhanced and Credit-Enhanced Loans in Our Single-Family Credit Guarantee Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 378.16 Td (23) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 378.16 Td (Single-Family Guarantee Portfolio Credit Risk Transfer Sensitivity Analysis) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 364.16 Td (24) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 364.16 Td (Credit Quality Characteristics of Our Single-Family Credit Guarantee Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 350.16 Td (25) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 350.16 Td (Characteristics of the Loans in Our Single-Family Credit Guarantee Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 336.16 Td (26) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 336.16 Td (Single-Family Credit Guarantee Portfolio Higher Risk Loan Data) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 322.16 Td (27) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 322.16 Td (Single-Family Credit Guarantee Portfolio Attribute Combinations for Higher Risk Loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 308.16 Td (28) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 308.16 Td (Higher Risk Single-Family Loan Credit Characteristics) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 294.16 Td (29) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 294.16 Td (Timing of Scheduled Payment Changes for Certain Single-Family Loan Types) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 280.16 Td (30) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 280.16 Td (Alt-A Loans in Our Single-Family Credit Guarantee Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 266.16 Td (31) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 266.16 Td (Geographic Concentration in Our Single-Family Credit Guarantee Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 252.16 Td (32) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 252.16 Td (Single-Family Charge-Offs and Recoveries by Region) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 238.16 Td (33) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 238.16 Td (Concentration of Single-Family Loans in Each Region by CLTV Ratio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 224.16 Td (34) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 224.16 Td (Single-Family Credit Guarantee Portfolio Credit Performance Metrics) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 210.16 Td (35) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 210.16 Td (Credit Characteristics of Certain Single-Family Loan Categories) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 196.16 Td (36) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 196.16 Td (Single-Family Allowance for Credit Losses Activity) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 182.16 Td (37) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 182.16 Td (Single-Family Individually Impaired Loans with an Allowance Recorded) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 168.16 Td (38) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 168.16 Td (Single-Family TDR and Non-Accrual Loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 154.16 Td (39) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 154.16 Td (Single-Family Relief Refinance Loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 140.16 Td (40) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 140.16 Td (Credit Characteristics of Single-Family Modified Loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 126.16 Td (41) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 126.16 Td (Payment Performance of Single-Family Modified Loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 112.16 Td (42) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 112.16 Td (Seriously Delinquent Single-Family Loans By Jurisdiction) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 98.16 Td (43) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 98.16 Td (Average Length of Foreclosure Process for Single-Family Loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 84.16 Td (44) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 84.16 Td (Single-Family REO Activity) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 70.16 Td (45) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 70.16 Td (Single-Family Severity Ratios) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 56.16 Td (46) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 56.16 Td (Multifamily Segment New Business Activity by Product Term) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 684.90986328125 m 548.299609375 684.90986328125 l s q 0 0 1 rg BT 538.70 686.16 Td (11) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 670.90986328125 m 548.299609375 670.90986328125 l s q 0 0 1 rg BT 538.70 672.16 Td (15) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 656.90986328125 m 548.299609375 656.90986328125 l s q 0 0 1 rg BT 538.70 658.16 Td (16) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 642.90986328125 m 548.299609375 642.90986328125 l s q 0 0 1 rg BT 538.70 644.16 Td (19) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 628.90986328125 m 548.299609375 628.90986328125 l s q 0 0 1 rg BT 538.70 630.16 Td (20) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 614.90986328125 m 548.299609375 614.90986328125 l s q 0 0 1 rg BT 538.70 616.16 Td (21) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 600.90986328125 m 548.299609375 600.90986328125 l s q 0 0 1 rg BT 538.70 602.16 Td (22) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 586.90986328125 m 548.299609375 586.90986328125 l s q 0 0 1 rg BT 538.70 588.16 Td (23) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 572.90986328125 m 548.299609375 572.90986328125 l s q 0 0 1 rg BT 538.70 574.16 Td (25) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 558.90986328125 m 548.299609375 558.90986328125 l s q 0 0 1 rg BT 538.70 560.16 Td (26) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 544.90986328125 m 548.299609375 544.90986328125 l s q 0 0 1 rg BT 538.70 546.16 Td (27) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 530.90986328125 m 548.299609375 530.90986328125 l s q 0 0 1 rg BT 538.70 532.16 Td (49) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 516.90986328125 m 548.299609375 516.90986328125 l s q 0 0 1 rg BT 538.70 518.16 Td (51) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 502.90986328124995 m 548.299609375 502.90986328124995 l s q 0 0 1 rg BT 538.70 504.16 Td (66) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 488.90986328124995 m 548.299609375 488.90986328124995 l s q 0 0 1 rg BT 538.70 490.16 Td (71) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 474.90986328124995 m 548.299609375 474.90986328124995 l s q 0 0 1 rg BT 538.70 476.16 Td (84) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 460.90986328124995 m 548.299609375 460.90986328124995 l s q 0 0 1 rg BT 538.70 462.16 Td (84) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 446.90986328124995 m 548.299609375 446.90986328124995 l s q 0 0 1 rg BT 538.70 448.16 Td (86) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 432.90986328124995 m 548.299609375 432.90986328124995 l s q 0 0 1 rg BT 538.70 434.16 Td (93) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 418.90986328124995 m 548.299609375 418.90986328124995 l s q 0 0 1 rg BT 538.70 420.16 Td (93) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 404.90986328124995 m 548.299609375 404.90986328124995 l s q 0 0 1 rg BT 538.70 406.16 Td (95) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 390.90986328124995 m 548.299609375 390.90986328124995 l s q 0 0 1 rg BT 538.70 392.16 Td (96) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 538.7 376.90986328124995 m 548.299609375 376.90986328124995 l s q 0 0 1 rg BT 538.70 378.16 Td (97) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 362.90986328124995 m 550.6994140625 362.90986328124995 l s q 0 0 1 rg BT 536.30 364.16 Td (101) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 348.90986328124995 m 550.6994140625 348.90986328124995 l s q 0 0 1 rg BT 536.30 350.16 Td (101) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 334.90986328124995 m 550.6994140625 334.90986328124995 l s q 0 0 1 rg BT 536.30 336.16 Td (103) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 320.90986328124995 m 550.6994140625 320.90986328124995 l s q 0 0 1 rg BT 536.30 322.16 Td (103) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 306.90986328124995 m 550.6994140625 306.90986328124995 l s q 0 0 1 rg BT 536.30 308.16 Td (105) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 292.90986328124995 m 550.6994140625 292.90986328124995 l s q 0 0 1 rg BT 536.30 294.16 Td (105) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 278.90986328124995 m 550.6994140625 278.90986328124995 l s q 0 0 1 rg BT 536.30 280.16 Td (106) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 264.90986328124995 m 550.6994140625 264.90986328124995 l s q 0 0 1 rg BT 536.30 266.16 Td (107) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 250.90986328124995 m 550.6994140625 250.90986328124995 l s q 0 0 1 rg BT 536.30 252.16 Td (107) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 236.90986328124995 m 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0.7529411764705882 rg /GS0 gs 526.00 227.50 36.00 -14.00 re f /GS0 gs BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 735.86 Td (47) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 735.86 Td (Non-Credit-Enhanced and Credit-Enhanced Loans Underlying Our Multifamily Mortgage Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 721.86 Td (48) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 721.86 Td (Multifamily Mortgage Portfolio Attributes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 707.86 Td (49) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 707.86 Td (Single-Family Credit Guarantee Portfolio Non-Depository Servicers) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 693.86 Td (50) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 693.86 Td (Single-Family Mortgage Insurers) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 679.86 Td (51) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 679.86 Td (Derivative Counterparty Credit Exposure) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 665.86 Td (52) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 665.86 Td (PMVS-YC and PMVS-L Results Assuming Shifts of the LIBOR Yield Curve) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 651.86 Td (53) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 651.86 Td (Duration Gap and PMVS Results) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 637.86 Td (54) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 637.86 Td (PMVS-L Results Before Derivatives and After Derivatives) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 623.86 Td (55) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 623.86 Td (Estimated Net Interest Rate Effect on Comprehensive Income \(Loss\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 609.86 Td (56) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 609.86 Td (GAAP Adverse Scenario Before and After Hedge Accounting) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 595.86 Td (57) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 595.86 Td (Estimated Spread Effect on Comprehensive Income \(Loss\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 581.86 Td (58) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 581.86 Td (Sources of Liquidity) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 567.86 Td (59) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 567.86 Td (Other Investments Portfolio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 553.86 Td (60) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 553.86 Td (Funding Sources) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 539.86 Td (61) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 539.86 Td (Other Debt Activity) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 525.86 Td (62) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 525.86 Td (Other Short-Term Debt) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 511.86 Td (63) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 511.86 Td (Activity for Debt Securities of Consolidated Trusts Held by Third Parties) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 497.86 Td (64) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 497.86 Td (Debt Securities of Consolidated Trusts Held by Third Parties) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 483.86 Td (65) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 483.86 Td (Freddie Mac Credit Ratings) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 469.86 Td (66) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 469.86 Td (Sources of Capital) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 455.86 Td (67) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 455.86 Td (Net Worth Activity) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 441.86 Td (68) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 441.86 Td (Returns on Conservatorship Capital) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 427.86 Td (69) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 427.86 Td (Mortgage-Related Investments Portfolio Details) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 413.86 Td (70) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 413.86 Td (2017 and 2016 Affordable Housing Goals Results) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 399.86 Td (71) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 399.86 Td (2018-2020 Affordable Housing Goals) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 385.86 Td (72) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 385.86 Td (Contractual Obligations) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 371.86 Td (73) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 371.86 Td (Quarterly Selected Financial Data) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 357.86 Td (74) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 357.86 Td (Board Compensation Levels) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 356.60986328125 m 550.6994140625 356.60986328125 l s q 0 0 1 rg BT 536.30 357.86 Td (363) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 343.86 Td (75) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 343.86 Td (Director Compensation) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 342.60986328125 m 550.6994140625 342.60986328125 l s q 0 0 1 rg BT 536.30 343.86 Td (364) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 329.86 Td (76) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 329.86 Td (2018 Target TDC) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 328.60986328125 m 550.6994140625 328.60986328125 l s q 0 0 1 rg BT 536.30 329.86 Td (371) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 315.86 Td (77) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 315.86 Td (2018 Deferred Salary) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 301.86 Td (78) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 301.86 Td (CEO Pay Ratio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 287.86 Td (79) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 287.86 Td (Compensation Summary) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 273.86 Td (80) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 273.86 Td (Grants of Plan-Based Awards) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 259.86 Td (81) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 259.86 Td (SERP and SERP II Benefits) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 258.60986328125 m 550.6994140625 258.60986328125 l s q 0 0 1 rg BT 536.30 259.86 Td (391) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 245.86 Td (82) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 245.86 Td (Compensation and Benefits if NEO Terminated Employment as of December 31, 2018) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 244.60986328125 m 550.6994140625 244.60986328125 l s q 0 0 1 rg BT 536.30 245.86 Td (393) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 231.86 Td (83) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 231.86 Td (Stock Ownership) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 217.86 Td (84) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 217.86 Td (5% Holders) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 67.90 203.86 Td (85) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 83.50 203.86 Td (Auditor Fees) Tj ET Q BT /F2 11.00 Tf ET BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 734.60986328125 m 550.6994140625 734.60986328125 l s q 0 0 1 rg BT 536.30 735.86 Td (121) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 720.60986328125 m 550.6994140625 720.60986328125 l s q 0 0 1 rg BT 536.30 721.86 Td (122) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 706.60986328125 m 550.6994140625 706.60986328125 l s q 0 0 1 rg BT 536.30 707.86 Td (124) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 692.60986328125 m 550.6994140625 692.60986328125 l s q 0 0 1 rg BT 536.30 693.86 Td (127) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 678.60986328125 m 550.6994140625 678.60986328125 l s q 0 0 1 rg BT 536.30 679.86 Td (130) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 664.60986328125 m 550.6994140625 664.60986328125 l s q 0 0 1 rg BT 536.30 665.86 Td (138) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 650.60986328125 m 550.6994140625 650.60986328125 l s q 0 0 1 rg BT 536.30 651.86 Td (138) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 636.60986328125 m 550.6994140625 636.60986328125 l s q 0 0 1 rg BT 536.30 637.86 Td (138) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 622.60986328125 m 550.6994140625 622.60986328125 l s q 0 0 1 rg BT 536.30 623.86 Td (142) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 608.60986328125 m 550.6994140625 608.60986328125 l s q 0 0 1 rg BT 536.30 609.86 Td (142) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 594.60986328125 m 550.6994140625 594.60986328125 l s q 0 0 1 rg BT 536.30 595.86 Td (142) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 580.60986328125 m 550.6994140625 580.60986328125 l s q 0 0 1 rg BT 536.30 581.86 Td (147) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 566.60986328125 m 550.6994140625 566.60986328125 l s q 0 0 1 rg BT 536.30 567.86 Td (147) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 552.60986328125 m 550.6994140625 552.60986328125 l s q 0 0 1 rg BT 536.30 553.86 Td (149) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 538.60986328125 m 550.6994140625 538.60986328125 l s q 0 0 1 rg BT 536.30 539.86 Td (150) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 524.60986328125 m 550.6994140625 524.60986328125 l s q 0 0 1 rg BT 536.30 525.86 Td (151) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 510.60986328125 m 550.6994140625 510.60986328125 l s q 0 0 1 rg BT 536.30 511.86 Td (153) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 496.60986328125 m 550.6994140625 496.60986328125 l s q 0 0 1 rg BT 536.30 497.86 Td (155) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 482.60986328125 m 550.6994140625 482.60986328125 l s q 0 0 1 rg BT 536.30 483.86 Td (155) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 468.60986328125 m 550.6994140625 468.60986328125 l s q 0 0 1 rg BT 536.30 469.86 Td (156) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 454.60986328125 m 550.6994140625 454.60986328125 l s q 0 0 1 rg BT 536.30 455.86 Td (157) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 440.60986328125 m 550.6994140625 440.60986328125 l s q 0 0 1 rg BT 536.30 441.86 Td (157) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 426.60986328125 m 550.6994140625 426.60986328125 l s q 0 0 1 rg BT 536.30 427.86 Td (166) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 412.60986328125 m 550.6994140625 412.60986328125 l s q 0 0 1 rg BT 536.30 413.86 Td (170) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 398.60986328125 m 550.6994140625 398.60986328125 l s q 0 0 1 rg BT 536.30 399.86 Td (170) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 384.60986328125 m 550.6994140625 384.60986328125 l s q 0 0 1 rg BT 536.30 385.86 Td (175) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 370.60986328125 m 550.6994140625 370.60986328125 l s q 0 0 1 rg BT 536.30 371.86 Td (339) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 314.60986328125 m 550.6994140625 314.60986328125 l s q 0 0 1 rg BT 536.30 315.86 Td (377) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 300.60986328125 m 550.6994140625 300.60986328125 l s q 0 0 1 rg BT 536.30 301.86 Td (385) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 286.60986328125 m 550.6994140625 286.60986328125 l s q 0 0 1 rg BT 536.30 287.86 Td (386) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 272.60986328125 m 550.6994140625 272.60986328125 l s q 0 0 1 rg BT 536.30 273.86 Td (387) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 230.60986328125 m 550.6994140625 230.60986328125 l s q 0 0 1 rg BT 536.30 231.86 Td (394) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 216.60986328125 m 550.6994140625 216.60986328125 l s q 0 0 1 rg BT 536.30 217.86 Td (394) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.50 w 0 i [] 0 d 1 J 1 j 3 M 536.3 202.60986328125 m 550.6994140625 202.60986328125 l s q 0 0 1 rg BT 536.30 203.86 Td (399) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL endstream endobj 11 0 obj <>] /Rotate 0 /Contents 12 0 R>> endobj 12 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 565 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 487.70 764.07 Td (About Freddie Mac) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 30.07 Td (1) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 32.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 724.20 Td (Introduction) Tj ET Q BT /F3 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 688.80 Td (This Annual Report on Form 10-K includes forward-looking statements that are based on current ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 673.40 Td (expectations and are subject to significant risks and uncertainties. These forward-looking statements are ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 658.00 Td (made as of the date of this Form 10-K. We undertake no obligation to update any forward-looking ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 642.60 Td (statement to reflect events or circumstances after the date of this Form 10-K. Actual results might differ ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 627.20 Td (significantly from those described in or implied by such statements due to various factors and ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 611.80 Td (uncertainties, including those described in the) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 274.68 611.80 Td ( ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 278.36 611.80 Td (Forward-Looking Statements) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 443.72 611.80 Td ( and ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 468.19 611.80 Td (Risk Factors) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 538.73 611.80 Td ( ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 596.40 Td (sections of this Form 10-K.) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 575.00 Td (Throughout this Form 10-K, we use certain acronyms and terms that are defined in the ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 474.82 575.00 Td (Glossary) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 524.27 575.00 Td (. In ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 559.60 Td (addition, throughout this Form 10-K, we refer to the three months ended December 31, 2018, the three ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 544.20 Td (months ended September 30, 2018, the three months ended June 30, 2018, the three months ended ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 528.80 Td (March 31, 2018, the three months ended December 31, 2017, the three months ended September 30, ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 513.40 Td (2017, the three months ended June 30, 2017, the three months ended March 31, 2017, and the three ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 498.00 Td (months ended December 31, 2016 as "4Q 2018," "3Q 2018," "2Q 2018," "1Q 2018," "4Q 2017," "3Q ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 49.50 482.60 Td (2017," "2Q 2017," "1Q 2017," and "4Q 2016," respectively.) Tj ET Q BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 450.20 Td (ABOUT FREDDIE MAC) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 428.80 Td (Freddie Mac is a GSE chartered by Congress in 1970. Our public mission is to provide liquidity, stability, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 413.40 Td (and affordability to the U.S. housing market. We do this primarily by purchasing residential mortgage ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 398.00 Td (loans originated by lenders. In most instances, we package these loans into mortgage-related securities, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 382.60 Td (which are guaranteed by us and sold in the global capital markets. In addition, we transfer mortgage ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 367.20 Td (credit risk exposure to private investors through our credit risk transfer programs, which include ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 351.80 Td (securities- and insurance-based offerings. We also invest in mortgage loans and mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 336.40 Td (securities. We do not originate loans or lend money directly to mortgage borrowers.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 315.00 Td (We support the U.S. housing market and the overall economy by enabling America's families to access ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 299.60 Td (mortgage loan funding with better terms and by providing consistent liquidity to the multifamily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 284.20 Td (mortgage market. We have helped many distressed borrowers keep their homes or avoid foreclosure. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 268.80 Td (We are working with FHFA, our customers, and the industry to build a better housing finance system for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 253.40 Td (the nation.) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 221.00 Td (Conservatorship and Government Support for Our ) Tj ET Q BT /F6 22.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 194.60 Td (Business) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 173.20 Td (Since September 2008, we have been operating in conservatorship, with FHFA as our Conservator. The ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 157.80 Td (conservatorship and related matters significantly affect our management, business activities, financial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 142.40 Td (condition, and results of operations. Our future is uncertain, and the conservatorship has no specified ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 127.00 Td (termination date. We do not know what changes may occur to our business model during or following ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 111.60 Td (conservatorship, including whether we will continue to exist.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 90.20 Td (Our Purchase Agreement with Treasury and the terms of the senior preferred stock we issued to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 74.80 Td (Treasury also affect our business activities. Our ability to access funds from Treasury under the Purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 59.40 Td (Agreement is critical to keeping us solvent and avoiding the appointment of a receiver by FHFA under ) Tj ET Q endstream endobj 13 0 obj <> endobj 14 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 565 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 487.70 764.07 Td (About Freddie Mac) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 30.07 Td (2) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (statutory mandatory receivership provisions. We believe that the support provided by Treasury pursuant ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (to the Purchase Agreement currently enables us to have adequate liquidity to conduct normal business ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 708.35 Td (activities.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 686.95 Td (In connection with our entry into conservatorship, we entered into the Purchase Agreement with ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.55 Td (Treasury. Under the Purchase Agreement, we issued to Treasury both senior preferred stock and a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 656.15 Td (warrant to purchase common stock. The senior preferred stock and warrant were issued as an initial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 640.75 Td (commitment fee in consideration of Treasury's commitment to provide funding to us under the Purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 625.35 Td (Agreement. Treasury, as the holder of the senior preferred stock, is entitled to receive cumulative ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 609.95 Td (quarterly cash dividends, when, as, and if declared by the Conservator, acting as successor to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 594.55 Td (rights, titles, powers, and privileges of our Board of Directors. The dividends we have paid to Treasury ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 579.15 Td (on the senior preferred stock have been declared by, and paid at the direction of, the Conservator.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 557.75 Td (Under the August 2012 amendment to the Purchase Agreement, our cash dividend requirement each ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 542.35 Td (quarter is the amount, if any, by which our Net Worth Amount at the end of the immediately preceding ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 526.95 Td (fiscal quarter, less the applicable Capital Reserve Amount, exceeds zero. Pursuant to the December ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 511.55 Td (2017 Letter Agreement, the applicable Capital Reserve Amount is $3.0 billion. If for any reason we were ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 496.15 Td (not to pay our dividend requirement on the senior preferred stock in full in any future period, the unpaid ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 480.75 Td (amount would be added to the liquidation preference and the applicable Capital Reserve Amount would ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 465.35 Td (thereafter be zero, but this would not affect our ability to draw funds from Treasury under the Purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 449.95 Td (Agreement.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 428.55 Td (The graph below shows our cumulative draws from Treasury and cumulative dividend payments to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 413.15 Td (Treasury. The Treasury draw amounts shown are the total draws requested based on our quarterly net ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 397.75 Td (deficits for the periods presented. Draw requests are funded in the quarter subsequent to any net deficit. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 382.35 Td (Under the Purchase Agreement, the payment of dividends does not reduce the outstanding liquidation ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 366.95 Td (preference of the senior preferred stock. The amount of available funding remaining under the Purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 351.55 Td (Agreement was $140.2 billion at December 31, 2018, and will be reduced by any future draws. For more ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 336.15 Td (information on the conservatorship and government support for our business, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 453.94 336.15 Td (MD&A - ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 320.75 Td (Conservatorship and Related Matters) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 263.49 320.75 Td ( and ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 288.16 320.75 Td (Note 2) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 325.89 320.75 Td (.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 182.15 301.55 Td (Draw Requests From and Dividend Payments To Treasury) Tj ET Q /GS0 gs q 510.00 0 0 225.00 51.00 71.55 cm /I43 Do Q BT /F2 11.00 Tf ET endstream endobj 15 0 obj <> endobj 16 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 565 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 487.70 764.07 Td (About Freddie Mac) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 30.07 Td (3) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 731.30 Td (Business Results) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 703.70 Td (Portfolio Balances) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 692.5 m 562.5 692.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 124.00 671.30 Td (Guarantee Portfolios) Tj ET Q /GS0 gs q 236.00 0 0 403.00 49.50 250.10 cm /I44 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 285.50 255.10 Td ( ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 394.20 671.30 Td (Investments Portfolios) Tj ET Q /GS0 gs q 236.00 0 0 349.00 324.00 304.10 cm /I45 Do Q BT /F2 11.00 Tf ET BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 229.30 Td (Total Guarantee Portfolio) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 218.10000000000002 m 562.5 218.10000000000002 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 192.44 cm /I46 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 192.44 cm /I47 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 194.70 Td (2018 vs. 2017 and 2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 232.64 194.70 Td ( - The total guarantee portfolio grew $101 billion, or 5%, in 2018, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 179.30 Td (driven by a 4% increase in our single-family credit guarantee portfolio and a 17% increase in our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 163.90 Td (multifamily guarantee portfolio. The total guarantee portfolio grew $119 billion, or 6%, in 2017, driven ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 148.50 Td (by a 4% increase in our single-family credit guarantee portfolio and a 28% increase in our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 133.10 Td (multifamily guarantee portfolio. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 112.44 cm /I48 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 112.44 cm /I49 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 114.70 Td (The growth in our single-family credit guarantee portfolio in both 2018 and 2017 was driven by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 99.30 Td (increases in U.S. single-family mortgage debt outstanding as a result of continued home price ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 83.90 Td (appreciation. New business acquisitions had a higher average loan size compared to older ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 68.50 Td (vintages that continued to run off.) Tj ET Q endstream endobj 17 0 obj <> endobj 18 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 565 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 487.70 764.07 Td (About Freddie Mac) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 30.07 Td (4) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 67.50 736.29 cm /I50 Do Q BT /F12 11.00 Tf ET q 0 0 0 rg BT 75.71 738.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 81.82 738.55 Td ( The growth in our multifamily guarantee portfolio in both 2018 and 2017 was primarily driven by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 723.15 Td (strong loan purchase and securitization activity, which was attributable to healthy multifamily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 707.75 Td (market fundamentals and strong demand for certain of our securitization products.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 684.95 Td (Total Investments Portfolio) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 673.75 m 562.5 673.75 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 648.09 cm /I51 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 648.09 cm /I52 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 650.35 Td (2018 vs. 2017 and 2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 232.64 650.35 Td ( - The total investments portfolio declined $62 billion, or 18%, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 634.95 Td ($51 billion, or 13%, in 2018 and 2017, respectively, primarily due to repayments and the active ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 619.55 Td (disposition of less liquid assets. We have reduced the mortgage-related investments portfolio as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 604.15 Td (required by the Purchase Agreement and FHFA.) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 574.75 Td (Consolidated Financial Results) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 547.15 Td (Comprehensive Income) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 535.95 m 562 535.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 430.00 0 0 305.00 90.75 217.95 cm /I53 Do Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 198.55 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 174.89 cm /I54 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 174.89 cm /I55 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 177.15 Td (2018 vs. 2017) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 156.49 cm /I56 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 156.49 cm /I57 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 158.75 Td (Comprehensive income was $8.6 billion for 2018, an increase of 55% compared to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 143.35 Td (comprehensive income of $5.6 billion for 2017. The increase in comprehensive income primarily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 127.95 Td (reflects two significant items in 2017: a non-cash charge of $5.4 billion due to the enactment of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 112.55 Td (tax reform legislation and a $4.5 billion, or $2.9 billion after-tax, benefit from a litigation ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 97.15 Td (settlement related to non-agency mortgage-related securities in which the company no longer ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 81.75 Td (invests.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 61.09 cm /I58 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 61.09 cm /I59 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 63.35 Td (Other key drivers of comprehensive income for 2018 include:) Tj ET Q endstream endobj 19 0 obj <> endobj 20 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 565 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 487.70 764.07 Td (About Freddie Mac) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 28.07 Td (5) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 741.15 Td (? Solid business revenues driven by continued growth in our guarantee portfolios, partially ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 725.75 Td (offset by lower net interest income driven by a reduction in the balance of our mortgage-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 710.35 Td (related investments portfolio;) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 691.95 Td (? Strong credit quality resulting in a higher benefit for credit losses in 2018, primarily driven by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 676.55 Td (estimated losses from the hurricanes in 2017;) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 658.15 Td (? Ongoing modest impacts from market-related items, despite significant volatility in the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 642.75 Td (financial markets, especially in 4Q 2018; and) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 624.35 Td (? Lower income tax expense due to the reduction in the statutory corporate income tax rate in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 608.95 Td (2018.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 585.29 cm /I60 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 585.29 cm /I61 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 587.55 Td (2017 vs. 2016) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 566.89 cm /I62 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 566.89 cm /I63 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 569.15 Td (Comprehensive income was $5.6 billion for 2017, a decrease of 22% compared to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 553.75 Td (comprehensive income of $7.1 billion for 2016, primarily due to the two significant items that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 538.35 Td (occurred in 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 517.69 cm /I64 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 517.69 cm /I65 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 519.95 Td (Other key drivers of comprehensive income for 2017 include:) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 501.55 Td (? Solid business revenues driven by continued growth in our guarantee portfolios, partially ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 486.15 Td (offset by lower net interest income driven by a reduction in the balance of our mortgage-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 470.75 Td (related investments portfolio;) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 452.35 Td (? Ongoing modest impacts from market-related items, driven by gains from spread tightening ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 436.95 Td (and single-family legacy asset dispositions; and) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 418.55 Td (? Lower benefit for credit losses, as 2017 was negatively affected by the hurricanes.) Tj ET Q endstream endobj 21 0 obj <> endobj 22 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 507.65 764.07 Td (Our Business) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 28.07 Td (6) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 733.30 Td (OUR BUSINESS) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 700.90 Td (Primary Business Strategies) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 679.50 Td (Our primary business strategies describe how we plan to pursue our Charter Mission through at least ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 664.10 Td (2021. The underlying assumption for these strategies is that the conservatorship will continue with no ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 648.70 Td (material changes during that period. FHFA or Congress could take actions that alter this assumption.) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 621.10 Td (Charter Mission) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 609.9 m 562.5 609.9 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 586.50 Td (We are a GSE with a specific and limited corporate purpose \(i.e., Charter Mission\) to support the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 571.10 Td (liquidity, stability, and affordability of U.S. housing markets as a participant in the secondary mortgage ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 555.70 Td (market, while operating as a commercial enterprise earning an appropriate return. Everything we do ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 540.30 Td (must be done within the constraints of our Charter Mission.) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 512.70 Td (Our Twin Goals) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 501.5 m 562.5 501.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (We have established overarching twin goals to enable us to reach our Charter Mission:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 454.44 cm /I66 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 57.71 456.70 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 456.70 Td (A Better Freddie Mac and ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 436.04 cm /I67 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 57.71 438.30 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 438.30 Td (A Better Housing Finance System) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 410.70 Td (Our Key Strategies) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 399.5 m 562.5 399.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 378.30 Td (A Better Freddie Mac) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 356.90 Td (We are focused on operating as a very well-run large financial institution by:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 333.24 cm /I68 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 335.50 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 335.50 Td (Achieving superior economic value of the company through strong risk, capital, and financial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 320.10 Td (management;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 299.44 cm /I69 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 57.71 301.70 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 301.70 Td (Being an effective operating organization; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 281.04 cm /I70 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 57.71 283.30 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 283.30 Td (Being a market leader through customer focus and innovation.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 264.10 Td (A Better Housing Finance System) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 242.70 Td (We are focused on providing leadership, through innovation and constructive forward-looking ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 227.30 Td (engagement with FHFA, to improve the liquidity, stability, and affordability of the U.S. housing markets ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 211.90 Td (by:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 188.24 cm /I71 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 57.71 190.50 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 190.50 Td (Modernizing and improving the efficiency of the mortgage markets, including reducing costs to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 175.10 Td (lenders and borrowers;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 154.44 cm /I72 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 57.71 156.70 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 156.70 Td (Developing greater responsible access to mortgage credit; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 136.04 cm /I73 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 57.71 138.30 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 138.30 Td (Reducing taxpayer exposure to our risks and subsidy to our returns. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 116.90 Td (For further information on our goals and detailed strategies for each of our business segments, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 101.50 Td (MD&A ?Our Business Segments) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 239.38 101.50 Td (.) Tj ET Q endstream endobj 23 0 obj <> endobj 24 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 507.65 764.07 Td (Our Business) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 28.07 Td (7) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 736.15 Td (Our Charter) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 724.95 m 562.5 724.95 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 701.55 Td (Our Charter forms the framework for our business activities. Our Charter Mission is to:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 677.89 cm /I74 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 677.89 cm /I75 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 680.15 Td (Provide stability in the secondary mortgage market for residential loans;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 659.49 cm /I76 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 659.49 cm /I77 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 661.75 Td (Respond appropriately to the private capital market;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 641.09 cm /I78 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 641.09 cm /I79 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 643.35 Td (Provide ongoing assistance to the secondary mortgage market for residential loans \(including ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 627.95 Td (activities relating to loans for low- and moderate-income families, involving a reasonable economic ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 612.55 Td (return that may be less than the return earned on other activities\) by increasing the liquidity of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 597.15 Td (mortgage investments and improving the distribution of investment capital available for residential ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 581.75 Td (mortgage financing; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 561.09 cm /I80 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 561.09 cm /I81 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 563.35 Td (Promote access to mortgage loan credit throughout the United States \(including central cities, rural ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 547.95 Td (areas, and other underserved areas\) by increasing the liquidity of mortgage investments and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 532.55 Td (improving the distribution of investment capital available for residential mortgage financing.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 511.15 Td (Our Charter permits us to purchase first-lien single-family loans with LTV ratios at the time of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 495.75 Td (purchase of less than or equal to 80%. Our Charter also permits us to purchase first-lien single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 480.35 Td (loans that do not meet this criterion if we have certain specified credit protections, which include ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 464.95 Td (mortgage insurance from a qualified insurer on the portion of the UPB of the loan that exceeds an 80% ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 449.55 Td (LTV ratio, a seller's agreement to repurchase or replace a defaulted loan, or the retention by the seller of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 434.15 Td (at least a 10% participation interest in the loan. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 412.75 Td (This Charter requirement does not apply to multifamily loans or to loans that have the benefit of any ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 397.35 Td (guarantee, insurance, or other obligation by the United States or any of its agencies or instrumentalities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 381.95 Td (\(e.g., the FHA, VA, or USDA Rural Development\). Additionally, as part of HARP and our Enhanced Relief ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 366.55 Td (Refinance) Tj ET Q BT /F2 11.00 Tf ET BT /F2 6.60 Tf ET q 0 0 0 rg BT 98.59 370.40 Td (SM) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 108.62 366.55 Td ( program, we purchase single-family refinanced loans we currently own or guarantee without ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 351.15 Td (obtaining additional credit enhancement in excess of that already in place for any such loan, even when ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 335.75 Td (the LTV ratio of the new loan is above 80%.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 314.35 Td (Our Charter does not permit us to originate loans or lend money directly to mortgage borrowers in the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 298.95 Td (primary mortgage market. Our Charter limits our purchase of single-family loans to the conforming loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 283.55 Td (market, which consists of loans originated with UPBs at or below limits determined annually based on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 268.15 Td (changes in FHFA's housing price index. In most of the United States, the maximum conforming loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 252.75 Td (limit for a one-family residence has been set at $484,350 for 2019, an increase from $453,100 for 2018, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 237.35 Td ($424,100 for 2017, and $417,000 from 2006 to 2016. Higher limits have been established in certain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 221.95 Td ("high-cost" areas \(for 2019, up to $726,525 for a one-family residence\). Higher limits also apply to two- ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 206.55 Td (to four-family residences and to one- to four-family residences in Alaska, Guam, Hawaii, and the U.S. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 191.15 Td (Virgin Islands.) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 159.95 Td (Business Segments) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 146.54999999999995 m 562.5 146.54999999999995 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 123.15 Td (We have three reportable segments: Single-family Guarantee, Multifamily, and Capital Markets. Certain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 107.75 Td (activities that are not part of a reportable segment are included in the All Other category. For more ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 92.35 Td (information on our segments, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 217.20 92.35 Td (MD&A - Our Business Segments) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 400.55 92.35 Td ( and ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 425.22 92.35 Td (Note?3) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 470.30 92.35 Td (.) Tj ET Q endstream endobj 25 0 obj <> endobj 26 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 507.65 764.07 Td (Our Business) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 28.07 Td (8) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 736.15 Td (Employees) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 724.95 m 562.5 724.95 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 701.55 Td (At February?, 2019, we had ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 191.00 701.55 Td (6,600) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 218.52 701.55 Td ( full-time and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 285.97 701.55 Td (42) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 298.20 701.55 Td ( part-time employees. ) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 673.95 Td (Properties) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 662.75 m 562.5 662.75 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 639.35 Td (Our principal offices consist of four office buildings we own in McLean, Virginia, comprising ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 623.95 Td (approximately 1.3 million square feet. We operate our business in the United States and its territories, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 608.55 Td (and accordingly, we generate no revenue from and have no long-lived assets, other than financial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 593.15 Td (instruments, in geographic locations other than the United States and its territories.) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 565.55 Td (Available Information) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 554.35 m 562.5 554.35 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 530.95 Td (We file reports and other information with the SEC. In view of the Conservator's succession to all of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 515.55 Td (voting power of our stockholders, we have not prepared or provided proxy statements for the solicitation ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 500.15 Td (of proxies from stockholders since we entered into conservatorship, and do not expect to do so while ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 484.75 Td (we remain in conservatorship. Pursuant to SEC rules, our annual reports on Form 10-K contain certain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 469.35 Td (information typically provided in an annual proxy statement.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 447.95 Td (We make available, free of charge through our website at) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 328.79 447.95 Td ( www.guciq.site) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 447.19 447.95 Td (, our annual reports on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 432.55 Td (Form?0-K, quarterly reports on Form?0-Q, current reports on Form?-K, and all other SEC reports and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 417.15 Td (amendments to those reports as soon as reasonably practicable after we electronically file the material ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 401.75 Td (with the SEC. The SEC also maintains an internet site \(www.sec.gov\) that contains reports, proxy and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 386.35 Td (information statements, and other information regarding companies that file electronically with the SEC. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 364.95 Td (We are providing our website addresses and the website address of the SEC here and elsewhere in this ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 349.55 Td (Form?0-K solely for your information. Information appearing on our website or on the SEC's website is ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 334.15 Td (not incorporated into this Form?0-K.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 312.75 Td (We provide disclosure about our debt securities on our website at ) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 375.29 312.75 Td (www.guciq.site/debt) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 518.33 312.75 Td (. From ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 297.35 Td (this address, investors can access the offering circular and related supplements for debt securities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 281.95 Td (offerings under Freddie Mac's global debt facility, including pricing supplements for individual issuances ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 266.55 Td (of debt securities. Similar information about our STACR) Tj ET Q BT /F1 11.00 Tf ET BT /F1 6.60 Tf ET q 0 0 0 rg BT 320.77 270.40 Td (? Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 326.05 266.55 Td ( transactions and SCR notes is available at ) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 251.15 Td (crt.freddiemac.com) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 152.47 251.15 Td ( and ) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 177.13 251.15 Td (mf.freddiemac.com/investors) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 331.34 251.15 Td (, respectively.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 229.75 Td (We provide disclosure about our mortgage-related securities, some of which are off-balance sheet ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 214.35 Td (obligations \(e.g., K Certificates and SB Certificates\), on our website at ) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 394.91 214.35 Td (www.guciq.site/mbs) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 536.92 214.35 Td (. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 198.95 Td (From this address, investors can access information and documents, including offering circulars and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 183.55 Td (offering circular supplements, for mortgage-related securities offerings.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 162.15 Td (We provide additional information, including product descriptions, investor presentations, securities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 146.75 Td (issuance calendars, transaction volumes and details, redemption notices, Freddie Mac research, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 131.35 Td (material developments or other events that may be important to investors, in each case as applicable, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 115.95 Td (on the websites for our business segments, which can be found at ) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 378.62 115.95 Td (www.guciq.site/) Tj ET Q BT /F1 11.00 Tf ET q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 100.55 Td (singlefamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 111.97 100.55 Td (, ) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 118.08 100.55 Td (mf.freddiemac.com) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 220.19 100.55 Td (, and ) Tj ET Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 247.91 100.55 Td (www.guciq.site/capital-markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 449.82 100.55 Td (.) Tj ET Q endstream endobj 27 0 obj <> endobj 28 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Introduction) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 447.05 764.07 Td (Forward-Looking Statements) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 553.45 30.07 Td (9) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 731.30 Td (FORWARD-LOOKING STATEMENTS) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 709.90 Td (We regularly communicate information concerning our business activities to investors, the news media, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.50 Td (securities analysts, and others as part of our normal operations. Some of these communications, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 679.10 Td (including this Form?0-K, contain "forward-looking statements." Examples of forward-looking ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 663.70 Td (statements include, but are not limited to, statements pertaining to the conservatorship, our current ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 648.30 Td (expectations and objectives for the Single-family Guarantee, Multifamily, and Capital Markets segments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 632.90 Td (of our business, our efforts to assist the housing market, our liquidity and capital management, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 617.50 Td (economic and market conditions and trends, our market share, the effect of legislative and regulatory ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 602.10 Td (developments and new accounting guidance, the credit quality of loans we own or guarantee, the costs ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 586.70 Td (and benefits of our credit risk transfer transactions, and our results of operations and financial condition ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 571.30 Td (on a GAAP, Segment Earnings, and fair value basis. Forward-looking statements involve known and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 555.90 Td (unknown risks and uncertainties, some of which are beyond our control. Forward-looking statements are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 540.50 Td (often accompanied by, and identified with, terms such as "could," "may," "will," "believe," "expect," ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 525.10 Td ("anticipate," "forecast," and similar phrases. These statements are not historical facts, but rather ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 509.70 Td (represent our expectations based on current information, plans, judgments, assumptions, estimates, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 494.30 Td (and projections. Actual results may differ significantly from those described in or implied by such ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 478.90 Td (forward-looking statements due to various factors and uncertainties, including those described in the ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 463.50 Td (Risk Factors) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 120.43 463.50 Td ( section of this Form 10-K and:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 439.84 cm /I82 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 439.84 cm /I83 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 442.10 Td (The actions the U.S. government \(including FHFA, Treasury, and Congress\) may take, or require us ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 426.70 Td (to take, including to support the housing markets or to implement FHFA's Conservatorship ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 411.30 Td (Scorecards and other objectives for us;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 390.64 cm /I84 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 390.64 cm /I85 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 392.90 Td (The effect of the restrictions on our business due to the conservatorship and the Purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 377.50 Td (Agreement, including our dividend requirement on the senior preferred stock;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 356.84 cm /I86 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 356.84 cm /I87 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 359.10 Td (Changes in our Charter or in applicable legislative or regulatory requirements \(including any ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 343.70 Td (legislation affecting the future status of our company\);) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 323.04 cm /I88 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 323.04 cm /I89 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 325.30 Td (Changes in the fiscal and monetary policies of the Federal Reserve, including the balance sheet ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 309.90 Td (normalization program to reduce the Federal Reserve's holdings of mortgage-related securities;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 289.24 cm /I90 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 289.24 cm /I91 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 291.50 Td (Changes in tax laws;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 270.84 cm /I92 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 270.84 cm /I93 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 273.10 Td (Changes in accounting policies, practices, or guidance \(e.g., FASB's accounting standards update ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 257.70 Td (related to the measurement of credit losses of financial instruments\);) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 237.04 cm /I94 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 237.04 cm /I95 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 239.30 Td (Changes in economic and market conditions, including changes in employment rates, interest rates, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 223.90 Td (spreads, and home prices;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 203.24 cm /I96 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 203.24 cm /I97 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 205.50 Td (Changes in the U.S. residential mortgage market, including changes in the supply and type of loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 190.10 Td (products \(e.g., refinance vs. purchase and fixed-rate vs. ARM\);) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 169.44 cm /I98 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 169.44 cm /I99 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 171.70 Td (The success of our efforts to mitigate our losses on our legacy and relief refinance single-family loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 156.30 Td (portfolio;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 135.64 cm /I100 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 135.64 cm /I101 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 137.90 Td (The success of our strategy to transfer mortgage credit risk through STACR debt note, STACR Trust, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 122.50 Td (ACIS) Tj ET Q BT /F1 11.00 Tf ET BT /F1 6.60 Tf ET q 0 0 0 rg BT 92.35 126.35 Td (? Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 97.63 122.50 Td (, K Certificate, SB Certificate, and other credit risk transfer transactions;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 101.84 cm /I102 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 101.84 cm /I103 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 104.10 Td (Our ability to maintain adequate liquidity to fund our operations;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 83.44 cm /I104 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 83.44 cm /I105 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 85.70 Td (Our ability to maintain the security and resiliency of our operational systems and infrastructure, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 70.30 Td (including against cyberattacks;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 49.64 cm /I106 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 49.64 cm /I107 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 51.90 Td (Our ability to effectively execute our business strategies, implement new initiatives, and improve ) Tj ET Q endstream 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0 i [] 0 d 0 J 0 j 3 M 504 620.5 m 504 605.5 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 333.20 625.86 Td (As of or For the Year Ended December 31,) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 611.29 Td (\(Dollars in millions,) Tj ET Q BT /F5 8.00 Tf ET q 1 1 1 rg BT 114.02 611.29 Td ( except share-related amounts) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 204.69 611.29 Td (\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 287.40 610.86 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 346.40 610.86 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 405.40 610.86 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 464.40 610.86 Td (2015) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 523.40 610.86 Td (2014) Tj ET Q BT /F9 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 582.57 Td (Statements of Comprehensive Income Data) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 568.57 Td (Net interest income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 291.55 568.57 Td ($12,021) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 350.55 568.57 Td ($14,164) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 409.55 568.57 Td ($14,379) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 468.55 568.57 Td ($14,946) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 527.55 568.57 Td ($14,263) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 554.57 Td (Benefit \(provision\) for credit losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 306.65 554.57 Td (736) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.00 554.57 Td (84) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.65 554.57 Td (803) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 477.20 554.57 Td (2,665) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.80 554.57 Td (\(58) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 554.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 540.57 Td (Non-interest income \(loss\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.20 540.57 Td (3,544) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 359.20 540.57 Td (6,869) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.65 540.57 Td (500) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 475.00 540.57 Td (\(3,599) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.65 540.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.50 540.57 Td (\(113) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 540.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 526.57 Td (Non-interest expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.00 526.57 Td (\(4,827) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 319.65 526.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.00 526.57 Td (\(4,283) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.65 526.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 416.00 526.57 Td (\(4,043) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 437.65 526.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 475.00 526.57 Td (\(4,738) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.65 526.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 534.00 526.57 Td (\(3,090) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 526.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 512.57 Td (Income tax \(expense\) benefit) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.00 512.57 Td (\(2,239) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 319.65 512.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.70 512.57 Td (\(11,209) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.65 512.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 416.00 512.57 Td (\(3,824) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 437.65 512.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 475.00 512.57 Td (\(2,898) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.65 512.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 534.00 512.57 Td (\(3,312) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 512.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 498.57 Td (Net income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.20 498.57 Td (9,235) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 359.20 498.57 Td (5,625) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 418.20 498.57 Td (7,815) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 477.20 498.57 Td (6,376) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.20 498.57 Td (7,690) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 484.57 Td (Comprehensive income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.20 484.57 Td (8,622) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 359.20 484.57 Td (5,558) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 418.20 484.57 Td (7,118) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 477.20 484.57 Td (5,799) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.20 484.57 Td (9,426) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 470.57 Td (Net income \(loss\) attributable to common stockholders) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.20 470.57 Td (3,612) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.00 470.57 Td (\(3,244) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.65 470.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 429.00 470.57 Td (97) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.80 470.57 Td (\(23) Tj ET Q 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Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 369.65 442.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 428.65 442.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.65 442.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.65 442.57 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 413.57 Td (Balance Sheets Data) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 399.57 Td (Loans held-for-investment, at amortized cost by consolidated) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 390.57 Td (trusts \(net of allowances for loan losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.75 395.07 Td ($1,842,850) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 339.75 395.07 Td ($1,774,286) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.75 395.07 Td ($1,690,218) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.75 395.07 Td ($1,625,184) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 516.75 395.07 Td ($1,558,094) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 376.57 Td (Total assets) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 285.05 376.57 Td (2,063,060) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 344.05 376.57 Td (2,049,776) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 403.05 376.57 Td (2,023,376) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 462.05 376.57 Td (1,985,892) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 521.05 376.57 Td (1,945,360) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 362.57 Td (Debt securities of consolidated trusts held by third parties) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 285.05 362.57 Td (1,792,677) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 344.05 362.57 Td (1,720,996) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 403.05 362.57 Td (1,648,683) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 462.05 362.57 Td (1,556,121) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 521.05 362.57 Td (1,479,473) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 348.57 Td (Other debt) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 291.55 348.57 Td (252,273) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 350.55 348.57 Td (313,634) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 409.55 348.57 Td (353,321) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 468.55 348.57 Td (414,148) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 527.55 348.57 Td (449,890) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 334.57 Td (All other liabilities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 295.85 334.57 Td (13,633) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.85 334.57 Td (15,458) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 413.85 334.57 Td (16,297) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.85 334.57 Td (12,683) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.85 334.57 Td (13,346) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 320.57 Td (Total stockholders' equity) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.20 320.57 Td (4,477) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.50 320.57 Td (\(312) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.65 320.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 418.20 320.57 Td (5,075) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 477.20 320.57 Td (2,940) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.20 320.57 Td (2,651) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 291.57 Td (Portfolio Balances - UPB) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 277.57 Td (Total guarantee portfolio) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.75 277.57 Td ($2,133,510) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 339.75 277.57 Td ($2,031,955) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.75 277.57 Td ($1,912,717) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.75 277.57 Td ($1,821,896) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 516.75 277.57 Td ($1,756,283) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 263.57 Td (Mortgage-related investments portfolio) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 291.55 263.57 Td (218,080) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 350.55 263.57 Td (253,455) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 409.55 263.57 Td (298,426) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 468.55 263.57 Td (346,911) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 527.55 263.57 Td (408,414) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 249.57 Td (Other investments portfolio) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 295.85 249.57 Td (62,917) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.85 249.57 Td (89,955) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 413.85 249.57 Td (95,041) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 468.55 249.57 Td (100,913) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.85 249.57 Td (78,037) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 235.57 Td (TDRs on accrual status) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 295.85 235.57 Td (41,914) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.85 235.57 Td (51,720) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 413.85 235.57 Td (77,399) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.85 235.57 Td (82,347) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.85 235.57 Td (82,908) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 221.57 Td (Non-accrual loans) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 295.85 221.57 Td (11,217) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.85 221.57 Td (17,817) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 413.85 221.57 Td (16,272) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.85 221.57 Td (22,649) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.85 221.57 Td (33,130) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 192.57 Td (Ratios) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 178.57 Td (Return on average assets) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 308.85 178.57 Td (0.4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 319.65 178.57 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.85 178.57 Td (0.3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.65 178.57 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 426.85 178.57 Td (0.4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 437.65 178.57 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.85 178.57 Td (0.3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.65 178.57 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.85 178.57 Td (0.4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 178.57 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 164.57 Td (Allowance for loan losses as percentage of loans, held-for-) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 155.57 Td (investment) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 308.85 160.07 Td (0.3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.85 160.07 Td (0.5) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 426.85 160.07 Td (0.7) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.85 160.07 Td (0.9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.85 160.07 Td (1.3) Tj ET Q BT /F2 11.00 Tf ET endstream endobj 33 0 obj <> endobj 34 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 463.50 764.07 Td (Key Economic Indicators) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (12) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 32.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 724.20 Td (Management's Discussion and ) Tj ET Q BT /F6 32.00 Tf ET q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 685.80 Td (Analysis of Financial Condition and ) Tj ET Q BT /F6 32.00 Tf ET q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 647.40 Td (Results of Operations) Tj ET Q BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 601.00 Td (KEY ECONOMIC INDICATORS) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 579.60 Td (The following graphs and related discussion present certain macroeconomic indicators that can ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 564.20 Td (significantly affect our business and financial results. ) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 531.80 Td (Single-Family Home Prices) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 504.20 Td (National Home Prices ) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 493 m 562.5 493 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 281.00 0 0 260.00 165.50 220.00 cm /I128 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 198.34 cm /I129 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 200.60 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 200.60 Td (Changes in home prices affect the amount of equity that borrowers have in their homes. Borrowers ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 185.20 Td (with less equity typically have higher delinquency rates. As home prices decline, the severity of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 169.80 Td (losses we incur on defaulted loans that we hold or guarantee increases because the amount we can ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 154.40 Td (recover from the property securing the loan decreases. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 133.74 cm /I130 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 133.74 cm /I131 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 136.00 Td (Home prices continued to appreciate during 2018, increasing 4.7%, compared to an increase of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 120.60 Td (7.2% during 2017. We expect home price growth will continue in 2019, although at a slower pace ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 105.20 Td (than in 2018, due to increased supply and higher mortgage interest rates.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 84.54 cm /I132 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 84.54 cm /I133 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 86.80 Td (Home price appreciation continued to drive growth in mortgage debt outstanding and declines in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 71.40 Td (single-family serious delinquency rates in the U.S. mortgage markets during 2018.) 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Increases \(decreases\) in the PMMS rate typically result in decreases ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 197.70 Td (\(increases\) in refinancing activity and originations. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 177.04 cm /I137 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 177.04 cm /I138 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 179.30 Td (Higher average mortgage interest rates drove a decline in origination volumes, especially refinance ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 163.90 Td (volume, during 2018.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 143.24 cm /I139 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 145.50 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 145.50 Td (Changes in the 10-year and 2-year LIBOR interest rates affect the fair value of certain of our assets ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 130.10 Td (and liabilities, including derivatives, measured at fair value. Changes in the 3-month LIBOR rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 114.70 Td (affect the interest earned on our short-term investments and interest expense on our short-term ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 99.30 Td (funding. For additional information on the effect of LIBOR rates on our financial results, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 516.03 99.30 Td (Our ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 67.50 83.90 Td (Business Segments - Capital Markets - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 293.37 83.90 Td (Market Conditions) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 398.36 83.90 Td (.) Tj ET Q endstream endobj 37 0 obj <> endobj 38 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 284 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 759 m 562 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 462.50 764.07 Td (Key Economic Indicators) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (14) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 731.30 Td (Unemployment Rate) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 703.70 Td (Unemployment Rate and Job Creation) Tj ET Q BT /F6 18.00 Tf ET BT /F6 10.80 Tf ET q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 346.77 710.00 Td (\(1\)) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 692.5 m 562.5 692.5 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 256.00 0 0 257.00 178.00 422.50 cm /I140 Do Q BT /F2 11.00 Tf ET BT /F5 8.00 Tf ET q 0 0 0 rg BT 258.00 408.90 Td (Source: U.S. Bureau of Labor Statistics) Tj ET Q BT /F5 8.00 Tf ET q 0 0 0 rg BT 67.50 390.30 Td (\(1\) Excludes Puerto Rico and the U.S. Virgin Islands.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 363.64 cm /I141 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 365.90 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 365.90 Td (Changes in the national unemployment rate can affect several market factors, including the demand ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 350.50 Td (for both single-family and multifamily housing and the level of loan delinquencies.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 329.84 cm /I142 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 332.10 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 332.10 Td (Continued job growth, a declining unemployment rate, and generally favorable economic conditions ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 316.70 Td (resulted in strong credit quality and declining serious delinquency rates in 2018.) Tj ET Q endstream endobj 39 0 obj <> endobj 40 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (15) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 731.30 Td (CONSOLIDATED RESULTS OF OPERATIONS) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 709.90 Td (You should read this discussion of our consolidated results of operations in conjunction with our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.50 Td (consolidated financial statements and accompanying notes.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 673.10 Td (The table below compares our consolidated results of operations for the past three years. ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 651.70 Td (Table 2 - Summary of Consolidated Statements of Comprehensive Income \(Loss\)) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 375.00 635.20 188.00 -15.00 re f /GS0 gs 0.4666666666666667 0.7411764705882353 0.27058823529411763 rg /GS0 gs 233.00 620.20 138.00 -15.00 re f /GS0 gs 0.4666666666666667 0.7411764705882353 0.27058823529411763 rg /GS0 gs 375.00 620.20 92.00 -15.00 re f /GS0 gs 0.4666666666666667 0.7411764705882353 0.27058823529411763 rg /GS0 gs 471.00 620.20 92.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 605.20 179.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 233.00 605.20 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 279.00 605.20 46.00 -15.00 re f 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l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 562.2 m 325 562.2 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 562.2 m 371 562.2 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 562.2 m 421 562.2 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 562.2 m 467 562.2 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 562.2 m 517 562.2 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 562.2 m 563 562.2 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 441.20000000000005 m 229 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 441.20000000000005 m 279 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 441.20000000000005 m 325 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 441.20000000000005 m 371 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 441.20000000000005 m 421 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 441.20000000000005 m 467 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 441.20000000000005 m 517 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 441.20000000000005 m 563 441.20000000000005 l s 0.5333333333333333 0.7411764705882353 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1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 334.20000000000005 m 467 334.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 348.20000000000005 m 517 348.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 334.20000000000005 m 517 334.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 348.20000000000005 m 563 348.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 334.20000000000005 m 563 334.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 306.20000000000005 m 229 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 306.20000000000005 m 279 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 306.20000000000005 m 325 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 306.20000000000005 m 371 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 306.20000000000005 m 421 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 306.20000000000005 m 467 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 306.20000000000005 m 517 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 306.20000000000005 m 563 306.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 269.20000000000005 m 229 269.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 256.20000000000005 m 229 256.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 254.20000000000005 m 229 254.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 269.20000000000005 m 279 269.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 256.20000000000005 m 279 256.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 254.20000000000005 m 279 254.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 269.20000000000005 m 325 269.20000000000005 l s 0.5333333333333333 0.7411764705882353 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256.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 254.20000000000005 m 421 254.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 269.20000000000005 m 467 269.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 256.20000000000005 m 467 256.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 254.20000000000005 m 467 254.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 269.20000000000005 m 517 269.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 256.20000000000005 m 517 256.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 254.20000000000005 m 517 254.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 269.20000000000005 m 563 269.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 256.20000000000005 m 563 256.20000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 254.20000000000005 m 563 254.20000000000005 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 423.90 625.56 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 251.10 610.56 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 393.45 610.56 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 610.56 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 594.99 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 245.90 595.56 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 291.90 595.56 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 337.90 595.56 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.10 595.56 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 439.60 595.56 Td (%) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 491.10 595.56 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 535.60 595.56 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 581.27 Td (Net interest income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 247.70 581.27 Td ($12,021) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 293.70 581.27 Td ($14,164) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 339.70 581.27 Td ($14,379) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 391.85 581.27 Td (\($2,143) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 581.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.65 581.27 Td (\(15) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 581.27 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 494.35 581.27 Td (\($215) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 581.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.30 581.27 Td (\(1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 553.45 581.27 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 567.27 Td (Benefit \(provision\) for credit losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.80 567.27 Td (736) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 313.15 567.27 Td (84) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.80 567.27 Td (803) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.80 567.27 Td (652) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 444.50 567.27 Td (776) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 567.27 Td (\(719) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 567.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.95 567.27 Td (\(90) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 567.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 553.27 Td (Net interest income after benefit \(provision\) for) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 544.27 Td (credit losses) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 252.00 548.77 Td (12,757) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.00 548.77 Td (14,248) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 344.00 548.77 Td (15,182) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 395.65 548.77 Td (\(1,491) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 417.80 548.77 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 446.15 548.77 Td (\(10) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 457.50 548.77 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 498.15 548.77 Td (\(934) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 513.80 548.77 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 545.80 548.77 Td (\(6) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 548.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 530.27 Td (Non-interest income \(loss\):) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 516.27 Td (Guarantee fee income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.80 516.27 Td (811) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 308.80 516.27 Td (662) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.80 516.27 Td (513) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.80 516.27 Td (149) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.85 516.27 Td (23) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 516.27 Td (149) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 516.27 Td (29) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 502.27 Td (Mortgage loans gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.80 502.27 Td (724) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.35 502.27 Td (2,026) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.80 502.27 Td (200) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 396.15 502.27 Td (\(1,302) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 502.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.65 502.27 Td (\(64) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 502.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 494.35 502.27 Td (1,826) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.80 502.27 Td (913) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 488.27 Td (Investment securities gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.65 488.27 Td (\(695) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 488.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.35 488.27 Td (1,036) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.65 488.27 Td (\(269) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 488.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 396.15 488.27 Td (\(1,731) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 488.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 442.35 488.27 Td (\(167) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 488.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 494.35 488.27 Td (1,305) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.80 488.27 Td (485) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 474.27 Td (Debt gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.80 474.27 Td (720) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 308.80 474.27 Td (151) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.65 474.27 Td (\(473) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 474.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.80 474.27 Td (569) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 444.50 474.27 Td (377) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 474.27 Td (624) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.80 474.27 Td (132) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 460.27 Td (Derivative gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 256.35 460.27 Td (1,270) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.15 460.27 Td (\(1,988) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 460.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.65 460.27 Td (\(274) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 460.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.35 460.27 Td (3,258) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 444.50 460.27 Td (164) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 492.15 460.27 Td (\(1,714) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 460.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 460.27 Td (\(626) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 460.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 446.27 Td (Other income \(loss\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.80 446.27 Td (714) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.35 446.27 Td (4,982) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.80 446.27 Td (803) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 396.15 446.27 Td (\(4,268) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 446.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.65 446.27 Td (\(86) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 446.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 494.35 446.27 Td (4,179) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.80 446.27 Td (520) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 432.27 Td (Total non-interest income \(loss\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 256.35 432.27 Td (3,544) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 302.35 432.27 Td (6,869) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 354.80 432.27 Td (500) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 395.65 432.27 Td (\(3,325) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 417.80 432.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 446.15 432.27 Td (\(48) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 457.50 432.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 494.35 432.27 Td (6,369) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 533.35 432.27 Td (1,274) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 418.27 Td (Non-interest expense:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 404.27 Td (Administrative expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 254.15 404.27 Td (\(2,293) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 404.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.15 404.27 Td (\(2,106) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 404.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 346.15 404.27 Td (\(2,005) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 404.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 404.27 Td (\(187) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 404.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.00 404.27 Td (\(9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 404.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 404.27 Td (\(101) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 404.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.30 404.27 Td (\(5) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 404.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 390.27 Td (Real estate owned operations expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.65 390.27 Td (\(169) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 390.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 306.65 390.27 Td (\(189) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 390.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.65 390.27 Td (\(287) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 390.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 409.15 390.27 Td (20) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.85 390.27 Td (11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 505.15 390.27 Td (98) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 390.27 Td (34) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 376.27 Td (Temporary Payroll Tax Cut Continuation Act of) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 367.27 Td (2011 expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 254.15 371.77 Td (\(1,484) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 371.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.15 371.77 Td (\(1,340) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 371.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 346.15 371.77 Td (\(1,152) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 371.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 371.77 Td (\(144) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 371.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.65 371.77 Td (\(11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 371.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 371.77 Td (\(188) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 371.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.95 371.77 Td (\(16) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 371.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 353.27 Td (Other expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.65 353.27 Td (\(881) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 353.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 306.65 353.27 Td (\(648) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 353.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.65 353.27 Td (\(599) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 353.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 353.27 Td (\(233) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 353.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.65 353.27 Td (\(36) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 353.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 502.95 353.27 Td (\(49) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 353.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.30 353.27 Td (\(8) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 353.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 339.27 Td (Total non-interest expense) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 253.65 339.27 Td (\(4,827) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 275.80 339.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 299.65 339.27 Td (\(4,283) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 321.80 339.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 345.65 339.27 Td (\(4,043) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 367.80 339.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 402.15 339.27 Td (\(544) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 417.80 339.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 446.15 339.27 Td (\(13) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 457.50 339.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 498.15 339.27 Td (\(240) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 513.80 339.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 545.80 339.27 Td (\(6) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 339.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 325.27 Td (Income before income tax \(expense\) benefit) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 252.00 325.27 Td (11,474) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.00 325.27 Td (16,834) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 344.00 325.27 Td (11,639) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 395.65 325.27 Td (\(5,360) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 417.80 325.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.65 325.27 Td (\(32) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 325.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 494.35 325.27 Td (5,195) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 325.27 Td (45) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 311.27 Td (Income tax \(expense\) benefit) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 254.15 311.27 Td (\(2,239) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 311.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 295.85 311.27 Td (\(11,209) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 311.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 346.15 311.27 Td (\(3,824) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 311.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.35 311.27 Td (8,970) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.85 311.27 Td (80) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 492.15 311.27 Td (\(7,385) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 311.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 311.27 Td (\(193) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 311.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 297.27 Td (Net income \(loss\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 256.35 297.27 Td (9,235) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 302.35 297.27 Td (5,625) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 348.35 297.27 Td (7,815) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 398.35 297.27 Td (3,610) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.85 297.27 Td (64) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 491.65 297.27 Td (\(2,190) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 513.80 297.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.95 297.27 Td (\(28) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 297.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 283.27 Td (Total other comprehensive income \(loss\), net of) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 274.27 Td (taxes and reclassification adjustments) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.65 278.77 Td (\(613) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 278.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 310.95 278.77 Td (\(67) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 278.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.65 278.77 Td (\(697) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 278.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 278.77 Td (\(546) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 278.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 442.35 278.77 Td (\(815) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.50 278.77 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 278.77 Td (630) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 278.77 Td (90) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 260.27 Td (Comprehensive income \(loss\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 252.00 260.27 Td ($8,622) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.00 260.27 Td ($5,558) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 344.00 260.27 Td ($7,118) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 394.00 260.27 Td ($3,064) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 448.85 260.27 Td (55) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 459.45 260.27 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 487.35 260.27 Td (\($1,560) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 513.80 260.27 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 541.45 260.27 Td (\(22) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 260.27 Td (\)%) Tj ET Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 234.30 Td (See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 71.50 234.30 Td (Critical Accounting Policies and Estimates) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 315.18 234.30 Td ( for information concerning certain significant ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 218.90 Td (accounting policies and estimates applied in determining our reported results of operations and ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 520.38 218.90 Td (Note 1) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 558.11 218.90 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 203.50 Td (for information on our accounting policies and a summary of other significant accounting policies and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 188.10 Td (the related notes in which information about them can be found.) Tj ET Q endstream endobj 41 0 obj <> endobj 42 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (16) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 733.30 Td (Net Interest Income) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 711.90 Td (Net interest income consists of several primary components: ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 691.24 cm /I143 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 693.50 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 693.50 Td (Contractual net interest income) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 233.39 693.50 Td ( - consists of two components:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 672.84 cm /I144 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 672.84 cm /I145 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 675.10 Td (Guarantee fees on debt securities issued by consolidated trusts. We record interest income on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 659.70 Td (loans held by consolidated trusts and interest expense on the debt securities issued by the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 644.30 Td (trusts. The difference between the interest income on the loans and the interest expense on the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 628.90 Td (debt represents the guarantee fee income we receive as compensation for our guarantee of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 613.50 Td (principal and interest payments of the issued debt securities. This difference includes the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 598.10 Td (legislated 10 basis point increase in guarantee fees that is remitted to Treasury as part of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 582.70 Td (Temporary Payroll Tax Cut Continuation Act of 2011 and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 562.04 cm /I146 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 562.04 cm /I147 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 564.30 Td (The difference between the interest income earned on all other interest-earning assets, excluding ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 548.90 Td (loans held by consolidated trusts, and the interest expense incurred on the liabilities used to fund ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 533.50 Td (those assets. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 512.10 Td (Contractual net interest income is driven by the volume of assets in the mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 496.70 Td (investments portfolio and the interest rate differential between those interest-earning assets and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 481.30 Td (related interest-bearing liabilities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 460.64 cm /I148 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 462.90 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 462.90 Td (Amortization of cost basis adjustments) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 272.82 462.90 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 276.28 462.90 Td (- consists of cost basis adjustments, such as premiums ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 447.50 Td (and discounts on loans, investment securities, and debt, that are amortized into interest income or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 432.10 Td (interest expense based on the effective yield over the contractual life of the associated financial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 416.70 Td (instrument. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 395.30 Td (The largest portion of our total net amortization relates to loans and debt securities of consolidated ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 379.90 Td (trusts and includes amortization of the upfront fees we receive when we acquire a loan. Amortization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 364.50 Td (related to other assets, including investment securities and unsecuritized mortgage loans, and other ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 349.10 Td (debt makes up a smaller portion. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 327.70 Td (The net amortization of loans and debt securities of consolidated trusts is primarily driven by actual ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 312.30 Td (prepayments on the underlying loans. Increases in actual prepayments result in higher net ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 296.90 Td (amortization, while decreases in actual prepayments result in lower net amortization. The timing of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 281.50 Td (amortization of loans may differ from the timing of amortization of the securities backed by the loans, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 266.10 Td (as the proceeds from the loans backing these securities are remitted to the security holders at a date ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 250.70 Td (subsequent to the date these proceeds are received by us. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 230.04 cm /I149 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 232.30 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 232.30 Td (Hedge accounting impact) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 202.53 232.30 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 205.99 232.30 Td (- consists of two components:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 211.64 cm /I150 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 211.64 cm /I151 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 213.90 Td (Deferred gains and losses on closed cash flow hedges related to forecasted debt issuances that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 198.50 Td (are reclassified from AOCI to net interest income when the related forecasted transaction affects ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 183.10 Td (net interest income and ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 162.44 cm /I152 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 162.44 cm /I153 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 164.70 Td (Fair value changes for the hedging instrument, including the accrual of periodic cash ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 149.30 Td (settlements, and fair value changes for the hedged item attributable to the risk being hedged for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 133.90 Td (qualifying fair value hedge relationships, due to the adoption of amended hedge accounting ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 118.50 Td (guidance in 4Q 2017. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 215.52 118.50 Td (Note 9) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 253.25 118.50 Td ( for additional detail on this change. ) Tj ET Q endstream endobj 43 0 obj <> endobj 44 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (17) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (The table below presents the components of net interest income. ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 717.75 Td (Table 3 - Components of Net Interest Income) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 375.00 701.25 188.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 233.00 686.25 138.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 375.00 686.25 92.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 471.00 686.25 92.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 671.25 179.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 233.00 671.25 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 279.00 671.25 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 325.00 671.25 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 375.00 671.25 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 421.00 671.25 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 471.00 671.25 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 517.00 671.25 46.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 279 671.25 m 279 656.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 325 671.25 m 325 656.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 421 671.25 m 421 656.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 517 671.25 m 517 656.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 590.25 m 229 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 590.25 m 279 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 590.25 m 325 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 590.25 m 371 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 590.25 m 421 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 590.25 m 467 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 590.25 m 517 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 590.25 m 563 590.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 526.25 m 229 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 512.25 m 229 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 510.25 m 229 510.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 526.25 m 279 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 512.25 m 279 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 233 510.25 m 279 510.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 526.25 m 325 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 512.25 m 325 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 510.25 m 325 510.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 526.25 m 371 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 512.25 m 371 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 510.25 m 371 510.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 526.25 m 421 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 512.25 m 421 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 375 510.25 m 421 510.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 526.25 m 467 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 512.25 m 467 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 421 510.25 m 467 510.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 526.25 m 517 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 512.25 m 517 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 510.25 m 517 510.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 526.25 m 563 526.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 512.25 m 563 512.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 510.25 m 563 510.25 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 423.90 691.61 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 251.10 676.61 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 393.45 676.61 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 676.61 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 661.04 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 245.90 661.61 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 291.90 661.61 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 337.90 661.61 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.10 661.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 439.60 661.61 Td (%) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 491.10 661.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 535.60 661.61 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 647.32 Td (Contractual net interest income:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 633.32 Td (Guarantee fee income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 252.00 633.32 Td ($3,457) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.00 633.32 Td ($3,270) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 344.00 633.32 Td ($2,997) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 400.50 633.32 Td ($187) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 452.45 633.32 Td (6) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.65 633.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.50 633.32 Td ($273) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.45 633.32 Td (9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 633.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 619.32 Td (Guarantee fee income related to the Temporary) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 610.32 Td (Payroll Tax Cut Continuation Act of 2011) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 256.35 614.82 Td (1,438) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.35 614.82 Td (1,314) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.35 614.82 Td (1,142) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.80 614.82 Td (124) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 452.45 614.82 Td (9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 614.82 Td (172) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 614.82 Td (15) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 595.32 Td (Other contractual net interest income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 256.35 595.32 Td (5,472) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.35 595.32 Td (6,400) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.35 595.32 Td (6,896) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 595.32 Td (\(928) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 595.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.95 595.32 Td (\(15) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 456.80 595.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 595.32 Td (\(496) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 595.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.30 595.32 Td (\(7) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 595.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 580.32 Td (Total contractual net interest income) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 252.00 580.32 Td (10,367) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.00 580.32 Td (10,984) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 344.00 580.32 Td (11,035) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 402.15 580.32 Td (\(617) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 417.80 580.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 449.80 580.32 Td (\(6) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 456.80 580.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 502.45 580.32 Td (\(51) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 513.80 580.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 543.80 580.32 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 566.32 Td (Net amortization - loans and debt securities of) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 557.32 Td (consolidated trusts) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 256.35 562.82 Td (2,900) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.35 562.82 Td (3,258) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.35 562.82 Td (3,333) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 562.82 Td (\(358) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 562.82 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.95 562.82 Td (\(11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 456.80 562.82 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 502.95 562.82 Td (\(75) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 562.82 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.30 562.82 Td (\(2) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 562.82 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 545.32 Td (Net amortization - other assets and other debt) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.65 545.32 Td (\(315) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 545.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 310.95 545.32 Td (\(85) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.80 545.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.80 545.32 Td (202) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 545.32 Td (\(230) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 545.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 441.65 545.32 Td (\(271) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 456.80 545.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 545.32 Td (\(287) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 545.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 545.32 Td (\(142) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 545.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 531.32 Td (Hedge accounting impact) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.65 531.32 Td (\(931) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.80 531.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.45 531.32 Td (7) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.65 531.32 Td (\(191) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.80 531.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.65 531.32 Td (\(938) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 417.80 531.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.85 531.32 Td (\(13,400) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 456.80 531.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 531.32 Td (198) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.80 531.32 Td (104) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 516.32 Td (Net interest income) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 247.70 516.32 Td ($12,021) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 293.70 516.32 Td ($14,164) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 339.70 516.32 Td ($14,379) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 391.35 516.32 Td (\($2,143) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 417.80 516.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 445.45 516.32 Td (\(15) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 456.80 516.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 493.85 516.32 Td (\($215) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 513.80 516.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 545.80 516.32 Td (\(1) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 516.32 Td (\)%) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 492.55 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 471.89 cm /I154 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 474.15 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 474.15 Td (Guarantee fee income) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 453.49 cm /I155 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 453.49 cm /I156 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 455.75 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 155.02 455.75 Td ( - Increased) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 213.50 455.75 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 216.56 455.75 Td (primarily due to the continued growth of the core single-family loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 440.35 Td (portfolio.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 419.69 cm /I157 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 419.69 cm /I158 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 421.95 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 155.02 421.95 Td ( - Increased as a result of higher average contractual guarantee fee rates, as well ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 406.55 Td (as the continued growth in the size of the core single-family loan portfolio. Average contractual ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 391.15 Td (guarantee fees are generally higher on mortgage loans in our core single-family loan portfolio ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 375.75 Td (compared to those in our legacy and relief refinance single-family loan portfolio. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 355.09 cm /I159 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 357.35 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 357.35 Td (Other contractual net interest income) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 336.69 cm /I160 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 336.69 cm /I161 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 338.95 Td (2018 vs. 2017 and 2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 250.42 338.95 Td ( - Decreased during both comparative periods primarily due to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 323.55 Td (the continued reduction in the balance of our mortgage-related investments portfolio, pursuant ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 308.15 Td (to the portfolio limits established by the Purchase Agreement and FHFA. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 464.61 308.15 Td (Conservatorship ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 85.50 292.75 Td (and Related Matters - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 213.68 292.75 Td (Limits on Our Mortgage-Related Investments Portfolio and ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 85.50 277.35 Td (Indebtedness) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 162.32 277.35 Td ( for additional discussion of the limits on the mortgage-related investments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 261.95 Td (portfolio.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 241.29 cm /I162 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 243.55 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 243.55 Td (Net amortization of loans and debt securities of consolidated trusts) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 222.89 cm /I163 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 222.89 cm /I164 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 225.15 Td (2018 vs. 2017 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 158.08 225.15 Td (- Decreased primarily driven by lower prepayments as a result of higher interest ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 209.75 Td (rates, partially offset by an increase in amortization from higher upfront fees on mortgage loans.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 189.09 cm /I165 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 191.35 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 191.35 Td (Net amortization of other assets and other debt) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 170.69 cm /I166 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 170.69 cm /I167 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 172.95 Td (2018 vs. 2017 ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 158.08 172.95 Td (- ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 166.23 172.95 Td (Increased primarily due to lower accretion related to unsecuritized mortgage ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 157.55 Td (loans, as certain of those loans were reclassified from held-for-investment to held-for-sale and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 142.15 Td (ceased amortizing, and previously recognized other-than-temporary impairments, due to a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 126.75 Td (decline in the population of impaired securities.) Tj ET Q endstream endobj 45 0 obj <> endobj 46 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (18) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 67.50 736.29 cm /I168 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 736.29 cm /I169 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 738.55 Td ( 2017 vs. 2016 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 161.14 738.55 Td (- decreased due to lower accretion related to previously recognized other-than-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 723.15 Td (temporary impairments due to a decline in the population of impaired securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 702.49 cm /I170 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 704.75 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 704.75 Td (Hedge accounting impact) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 684.09 cm /I171 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 684.09 cm /I172 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 686.35 Td (2018 vs. 2017 and 2017 vs. 2016 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 253.47 686.35 Td (- affected both comparative periods primarily due to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 670.95 Td (inclusion of fair value hedge accounting results within net interest income beginning in 4Q 2017, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 655.55 Td (due to the adoption of amended hedge accounting guidance. In prior periods, this activity was ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 640.15 Td (included in other income and derivative gains \(losses\).) Tj ET Q endstream endobj 47 0 obj <> endobj 48 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (19) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 736.15 Td (Net Interest Yield Analysis) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 724.95 m 562 724.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 701.55 Td (The table below presents an analysis of interest-earning assets and interest-bearing liabilities. To ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 686.15 Td (calculate the average balances, we generally use a daily weighted average of amortized cost. When ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 670.75 Td (daily average balance information is not available, such as for mortgage loans, we use monthly ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 655.35 Td (averages. Mortgage loans on non-accrual status, where interest income is generally recognized when ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 639.95 Td (collected, are included in the average balances. ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 618.55 Td (Table 4 - Analysis of Net Interest Yield) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 186.00 602.05 377.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 186.00 587.05 123.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 313.00 587.05 123.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 440.00 587.05 123.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 572.05 132.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 186.00 572.05 46.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 232.00 572.05 42.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 274.00 572.05 35.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 313.00 572.05 46.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 359.00 572.05 42.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 401.00 572.05 35.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 440.00 572.05 46.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 486.00 572.05 42.00 -33.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 528.00 572.05 35.00 -33.00 re f /GS0 gs 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 232 572.05 m 232 539.05 l s 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 274 572.05 m 274 539.05 l s 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 359 572.05 m 359 539.05 l s 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 401 572.05 m 401 539.05 l s 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 486 572.05 m 486 539.05 l s 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 528 572.05 m 528 539.05 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 431.04999999999995 m 359 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 431.04999999999995 m 401 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 431.04999999999995 m 436 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 431.04999999999995 m 486 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 431.04999999999995 m 528 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 431.04999999999995 m 563 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 431.04999999999995 m 182 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 411.04999999999995 m 182 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 431.04999999999995 m 232 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 411.04999999999995 m 232 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 431.04999999999995 m 274 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 411.04999999999995 m 274 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 431.04999999999995 m 309 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 411.04999999999995 m 309 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 431.04999999999995 m 359 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 411.04999999999995 m 359 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 431.04999999999995 m 401 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 411.04999999999995 m 401 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 431.04999999999995 m 436 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 411.04999999999995 m 436 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 431.04999999999995 m 486 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 411.04999999999995 m 486 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 431.04999999999995 m 528 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 411.04999999999995 m 528 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 431.04999999999995 m 563 431.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 411.04999999999995 m 563 411.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 369.04999999999995 m 182 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 369.04999999999995 m 232 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 369.04999999999995 m 274 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 369.04999999999995 m 309 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 369.04999999999995 m 359 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 369.04999999999995 m 401 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 369.04999999999995 m 436 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 369.04999999999995 m 486 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 369.04999999999995 m 528 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 369.04999999999995 m 563 369.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 286.04999999999995 m 182 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 286.04999999999995 m 232 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 286.04999999999995 m 274 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 286.04999999999995 m 309 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 286.04999999999995 m 359 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 286.04999999999995 m 401 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 286.04999999999995 m 436 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 286.04999999999995 m 486 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 286.04999999999995 m 528 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 286.04999999999995 m 563 286.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 218.04999999999995 m 182 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 206.04999999999995 m 182 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 218.04999999999995 m 232 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 206.04999999999995 m 232 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 218.04999999999995 m 274 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 206.04999999999995 m 274 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 218.04999999999995 m 309 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 206.04999999999995 m 309 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 218.04999999999995 m 359 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 206.04999999999995 m 359 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 218.04999999999995 m 401 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 206.04999999999995 m 401 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 218.04999999999995 m 436 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 206.04999999999995 m 436 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 218.04999999999995 m 486 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 206.04999999999995 m 486 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 218.04999999999995 m 528 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 206.04999999999995 m 528 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 218.04999999999995 m 563 218.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 206.04999999999995 m 563 206.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 166.04999999999995 m 182 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 166.04999999999995 m 232 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 166.04999999999995 m 274 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 166.04999999999995 m 309 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 166.04999999999995 m 359 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 166.04999999999995 m 401 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 166.04999999999995 m 436 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 166.04999999999995 m 486 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 166.04999999999995 m 528 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 166.04999999999995 m 563 166.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 145.04999999999995 m 182 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 132.04999999999995 m 182 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 130.04999999999995 m 182 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 145.04999999999995 m 232 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 132.04999999999995 m 232 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 186 130.04999999999995 m 232 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 145.04999999999995 m 274 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 132.04999999999995 m 274 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 232 130.04999999999995 m 274 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 145.04999999999995 m 309 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 132.04999999999995 m 309 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 274 130.04999999999995 m 309 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 145.04999999999995 m 359 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 132.04999999999995 m 359 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 313 130.04999999999995 m 359 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 145.04999999999995 m 401 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 132.04999999999995 m 401 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 130.04999999999995 m 401 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 145.04999999999995 m 436 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 132.04999999999995 m 436 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 401 130.04999999999995 m 436 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 145.04999999999995 m 486 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 132.04999999999995 m 486 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 440 130.04999999999995 m 486 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 145.04999999999995 m 528 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 132.04999999999995 m 528 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 486 130.04999999999995 m 528 130.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 145.04999999999995 m 563 145.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 132.04999999999995 m 563 132.04999999999995 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 528 130.04999999999995 m 563 130.04999999999995 l s BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 592.12 Td (? Tj ET Q BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 323.60 592.41 Td (Year Ended December 31,) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 577.12 Td (? Tj ET Q BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 237.40 577.41 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 364.40 577.41 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 491.40 577.41 Td (2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 543.84 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 194.00 555.12 Td (Average) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 194.15 544.12 Td (Balance) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 238.75 562.12 Td (Interest) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 239.35 553.12 Td (Income) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 234.90 544.12 Td (\(Expense\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 276.50 553.12 Td (Average) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 282.95 544.12 Td (Rate) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 321.00 555.12 Td (Average) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 321.15 544.12 Td (Balance) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 365.75 562.12 Td (Interest) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 366.35 553.12 Td (Income) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 361.90 544.12 Td (\(Expense\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 403.50 553.12 Td (Average) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 409.95 544.12 Td (Rate) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 448.00 555.12 Td (Average) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 448.15 544.12 Td (Balance) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 492.75 562.12 Td (Interest) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 493.35 553.12 Td (Income) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 488.90 544.12 Td (\(Expense\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 530.50 553.12 Td (Average) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 536.95 544.12 Td (Rate) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 530.12 Td (Interest-earning assets:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 518.12 Td (Cash and cash equivalents) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 205.00 518.12 Td ($7,189) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 257.80 518.12 Td ($67) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 518.12 Td (0.93) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 301.65 518.12 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 327.70 518.12 Td ($10,965) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 384.80 518.12 Td ($48) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 518.12 Td (0.44) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 428.65 518.12 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 454.70 518.12 Td ($16,932) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 518.12 Td ($42) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 518.12 Td (0.25) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 518.12 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 505.12 Td (Securities purchased under) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 496.12 Td (agreements to resell) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 205.00 501.62 Td (45,360) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 257.80 501.62 Td (880) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 501.62 Td (1.94) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 332.00 501.62 Td (57,883) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 384.80 501.62 Td (588) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 501.62 Td (1.02) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.00 501.62 Td (59,639) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 501.62 Td (217) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 501.62 Td (0.36) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 484.12 Td (Secured lending) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 209.35 484.12 Td (1,350) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.15 484.12 Td (35) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 484.12 Td (2.58) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 342.80 484.12 Td (859) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 389.15 484.12 Td (21) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 484.12 Td (2.42) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 469.80 484.12 Td (484) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 516.15 484.12 Td (11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 484.12 Td (2.28) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 470.12 Td (Mortgage-related securities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 457.12 Td (Mortgage-related securities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 200.70 457.12 Td (143,424) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 251.35 457.12 Td (6,026) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 457.12 Td (4.20) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 327.70 457.12 Td (164,663) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.35 457.12 Td (6,402) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 457.12 Td (3.89) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 454.70 457.12 Td (189,982) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 505.35 457.12 Td (7,262) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 457.12 Td (3.82) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 443.12 Td (Extinguishment of PCs held by) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 434.12 Td (Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 202.85 439.62 Td (\(88,757) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 228.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 249.15 439.62 Td (\(3,437) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 270.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.50 439.62 Td (\(3.87) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 329.85 439.62 Td (\(87,665) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 376.15 439.62 Td (\(3,264) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 397.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 408.50 439.62 Td (\(3.72) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 425.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 456.85 439.62 Td (\(94,624) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 482.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.15 439.62 Td (\(3,509) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 524.80 439.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 535.50 439.62 Td (\(3.71) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 439.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 70.50 422.12 Td (Total mortgage-related) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 70.50 413.12 Td (securities, net) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 205.00 419.12 Td (54,667) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 251.35 419.12 Td (2,589) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 283.65 419.12 Td (4.74) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 332.00 419.12 Td (76,998) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 378.35 419.12 Td (3,138) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 410.65 419.12 Td (4.08) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 459.00 419.12 Td (95,358) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 505.35 419.12 Td (3,753) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 537.65 419.12 Td (3.94) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 402.12 Td (Non-mortgage-related securities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 205.00 402.12 Td (18,955) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 257.80 402.12 Td (446) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 402.12 Td (2.35) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 332.00 402.12 Td (17,558) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 384.80 402.12 Td (277) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 402.12 Td (1.58) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.00 402.12 Td (15,734) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 402.12 Td (102) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 402.12 Td (0.65) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 388.12 Td (Loans held by consolidated trusts) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 169.84 391.27 Td (\(1\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 194.20 388.12 Td (1,799,122) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 247.00 388.12 Td (61,883) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 388.12 Td (3.44) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.20 388.12 Td (1,730,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 374.00 388.12 Td (58,746) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 388.12 Td (3.40) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.20 388.12 Td (1,649,727) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 501.00 388.12 Td (55,417) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 388.12 Td (3.36) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 374.12 Td (Loans held by Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 147.75 377.27 Td (\(1\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 205.00 374.12 Td (98,005) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 251.35 374.12 Td (4,154) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 374.12 Td (4.24) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 327.70 374.12 Td (117,043) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.35 374.12 Td (4,989) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 374.12 Td (4.26) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 454.70 374.12 Td (135,882) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 505.35 374.12 Td (5,623) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 374.12 Td (4.14) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 76.50 360.12 Td (Total interest-earning) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 76.50 351.12 Td (assets) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 194.20 357.12 Td (2,024,648) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 247.00 357.12 Td (70,054) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 283.65 357.12 Td (3.46) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 321.20 357.12 Td (2,011,306) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 374.00 357.12 Td (67,807) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 410.65 357.12 Td (3.37) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 448.20 357.12 Td (1,973,756) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 501.00 357.12 Td (65,165) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 537.65 357.12 Td (3.30) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 340.12 Td (Interest-bearing liabilities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 328.12 Td (Debt securities of consolidated) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 319.12 Td (trusts including PCs held by) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 310.12 Td (Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 194.20 320.12 Td (1,826,429) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 244.85 320.12 Td (\(54,966) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 270.80 320.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.50 320.12 Td (\(3.01) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.80 320.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.20 320.12 Td (1,753,983) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.85 320.12 Td (\(50,920) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 397.80 320.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 408.50 320.12 Td (\(2.90) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 425.80 320.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.20 320.12 Td (1,674,474) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.85 320.12 Td (\(48,108) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 524.80 320.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 535.50 320.12 Td (\(2.87) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 320.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 298.12 Td (Extinguishment of PCs held by) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 289.12 Td (Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 202.85 294.62 Td (\(88,757) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 228.80 294.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 251.35 294.62 Td (3,437) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 294.62 Td (3.87) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 329.85 294.62 Td (\(87,665) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.80 294.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 378.35 294.62 Td (3,264) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 294.62 Td (3.72) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 456.85 294.62 Td (\(94,624) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 482.80 294.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 505.35 294.62 Td (3,509) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 294.62 Td (3.71) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 277.12 Td (Total debt securities of) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 268.12 Td (consolidated trusts held by) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 259.12 Td (third parties) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 194.20 268.12 Td (1,737,672) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 244.35 268.12 Td (\(51,529) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 270.80 268.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 281.00 268.12 Td (\(2.97) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.80 268.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 321.20 268.12 Td (1,666,318) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 371.35 268.12 Td (\(47,656) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 397.80 268.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 408.00 268.12 Td (\(2.86) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 425.80 268.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 448.20 268.12 Td (1,579,850) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 498.35 268.12 Td (\(44,599) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 524.80 268.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 535.00 268.12 Td (\(2.82) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 268.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 245.12 Td (Other debt:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 233.12 Td (Short-term debt) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 205.00 233.12 Td (62,893) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 249.15 233.12 Td (\(1,193) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 270.80 233.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.50 233.12 Td (\(1.90) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.80 233.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 332.00 233.12 Td (72,071) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 382.65 233.12 Td (\(615) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 397.80 233.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 408.50 233.12 Td (\(0.85) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 425.80 233.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.00 233.12 Td (86,284) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 509.65 233.12 Td (\(350) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 524.80 233.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 535.50 233.12 Td (\(0.41) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 233.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 221.12 Td (Long-term debt) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 200.70 221.12 Td (216,484) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 249.15 221.12 Td (\(5,311) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 270.80 221.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.50 221.12 Td (\(2.45) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.80 221.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 327.70 221.12 Td (264,354) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 376.15 221.12 Td (\(5,372) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 397.80 221.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 408.50 221.12 Td (\(2.03) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 425.80 221.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 454.70 221.12 Td (298,040) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.15 221.12 Td (\(5,837) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 524.80 221.12 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 535.50 221.12 Td (\(1.96) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.80 221.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 70.50 209.12 Td (Total other debt) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 200.70 209.12 Td (279,377) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 248.65 209.12 Td (\(6,504) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 270.80 209.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 281.00 209.12 Td (\(2.33) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.80 209.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 327.70 209.12 Td (336,425) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 375.65 209.12 Td (\(5,987) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 397.80 209.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 408.00 209.12 Td (\(1.78) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 425.80 209.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 454.70 209.12 Td (384,324) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 502.65 209.12 Td (\(6,187) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 524.80 209.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 535.00 209.12 Td (\(1.61) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 209.12 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 76.50 197.12 Td (Total interest-bearing) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 76.50 188.12 Td (liabilities) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 194.20 194.62 Td (2,017,049) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 244.35 194.62 Td (\(58,033) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 270.80 194.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 281.00 194.62 Td (\(2.88) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.80 194.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 321.20 194.62 Td (2,002,743) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 371.35 194.62 Td (\(53,643) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 397.80 194.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 408.00 194.62 Td (\(2.68) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 425.80 194.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 448.20 194.62 Td (1,964,174) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 498.35 194.62 Td (\(50,786) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 524.80 194.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 535.00 194.62 Td (\(2.58) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 194.62 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 178.12 Td (Impact of net non-interest-bearing) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 169.12 Td (funding) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 209.35 174.62 Td (7,599) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 261.75 174.62 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 283.65 174.62 Td (0.01) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 336.35 174.62 Td (8,563) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 388.75 174.62 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.65 174.62 Td (0.01) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 463.35 174.62 Td (9,582) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 515.75 174.62 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 174.62 Td (0.01) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 157.12 Td (Total funding of interest-) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 148.12 Td (earning assets) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 189.90 153.62 Td ($2,024,648) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 240.00 153.62 Td (\($58,033) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 270.80 153.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 281.00 153.62 Td (\(2.87) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 298.80 153.62 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 316.90 153.62 Td ($2,011,306) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 367.05 153.62 Td (\($53,643) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 397.80 153.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 408.00 153.62 Td (\(2.67) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 425.80 153.62 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 443.90 153.62 Td ($1,973,756) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 494.05 153.62 Td (\($50,786) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 524.80 153.62 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 535.00 153.62 Td (\(2.57) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 552.80 153.62 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 136.12 Td (Net interest income/yield) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 242.70 136.12 Td ($12,021) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 283.65 136.12 Td (0.59) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 301.45 136.12 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 369.70 136.12 Td ($14,164) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 410.65 136.12 Td (0.70) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 428.45 136.12 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 496.70 136.12 Td ($14,379) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 537.65 136.12 Td (0.73) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 555.45 136.12 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 114.75 Td (\(1\) ) Tj ET Q q 0 0 0 rg BT 76.50 114.75 Td (Loan fees, primarily consisting of amortization of upfront fees, included in interest income were $2.6 billion, $2.4 billion, and $2.6 billion for loans ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 103.95 Td (held by consolidated trusts and $104 million, $162 million, and $215 million for loans held by Freddie Mac during 2018, 2017, and 2016, ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 93.15 Td (respectively.) Tj ET Q endstream endobj 49 0 obj <> endobj 50 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (20) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Net Interest Income Rate / Volume Analysis) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 699.55 Td (The table below presents a rate and volume analysis of our net interest income. Our net interest income ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 684.15 Td (reflects the reversal of interest income accrued, net of interest received on a cash basis, related to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 668.75 Td (mortgage loans that are on non-accrual status.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 647.35 Td (Table 5 - Net Interest Income Rate / Volume Analysis) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 271.00 630.85 292.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 271.00 615.85 144.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 419.00 615.85 144.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 600.85 217.00 -23.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 271.00 600.85 48.00 -23.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 319.00 600.85 48.00 -23.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 367.00 600.85 48.00 -23.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 419.00 600.85 48.00 -23.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 467.00 600.85 48.00 -23.00 re f /GS0 gs 0 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475.85 m 467 475.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 467 475.85 m 515 475.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 515 475.85 m 563 475.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 460.85 m 267 460.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 460.85 m 319 460.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 460.85 m 367 460.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 460.85 m 415 460.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 419 460.85 m 467 460.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 467 460.85 m 515 460.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 515 460.85 m 563 460.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 416.85 m 267 416.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 416.85 m 319 416.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 416.85 m 367 416.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 416.85 m 415 416.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 419 416.85 m 467 416.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 467 416.85 m 515 416.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 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0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 240.85000000000002 m 267 240.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 256.85 m 319 256.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 242.85000000000002 m 319 242.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 240.85000000000002 m 319 240.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 256.85 m 367 256.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 242.85000000000002 m 367 242.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 240.85000000000002 m 367 240.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 256.85 m 415 256.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 242.85000000000002 m 415 242.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 240.85000000000002 m 415 240.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 419 256.85 m 467 256.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 419 242.85000000000002 m 467 242.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 419 240.85000000000002 m 467 240.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 467 256.85 m 515 256.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 467 242.85000000000002 m 515 242.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 467 240.85000000000002 m 515 240.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 515 256.85 m 563 256.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 515 242.85000000000002 m 563 242.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 515 240.85000000000002 m 563 240.85000000000002 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 381.40 621.21 Td (Variance Analysis) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 315.45 606.21 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 463.45 606.21 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 582.64 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 286.45 582.92 Td (Rate) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 329.25 582.92 Td (Volume) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 381.75 591.92 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 377.05 582.92 Td (Change) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 434.45 582.92 Td (Rate) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 477.25 582.92 Td (Volume) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 529.75 591.92 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 525.05 582.92 Td (Change) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 567.92 Td (Interest-earning assets:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 552.92 Td (Cash and cash equivalents) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.80 552.92 Td ($45) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.65 552.92 Td (\($26) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.80 552.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.80 552.92 Td ($19) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 455.15 552.92 Td ($8) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.95 552.92 Td (\($2) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 552.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 551.15 552.92 Td ($6) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 538.92 Td (Securities purchased under agreements to resell) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.80 538.92 Td (443) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.65 538.92 Td (\(151) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.80 538.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.80 538.92 Td (292) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.80 538.92 Td (380) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 505.30 538.92 Td (\(9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 538.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 538.92 Td (371) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 524.92 Td (Secured lending) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 311.45 524.92 Td (1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.15 524.92 Td (13) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 403.15 524.92 Td (14) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.45 524.92 Td (1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 507.45 524.92 Td (9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 551.15 524.92 Td (10) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 509.92 Td (Mortgage-related securities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 494.92 Td (Mortgage-related securities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.80 494.92 Td (491) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.65 494.92 Td (\(867) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.80 494.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 396.65 494.92 Td (\(376) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.80 494.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.80 494.92 Td (123) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.65 494.92 Td (\(983) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 494.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.65 494.92 Td (\(860) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 559.80 494.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 480.92 Td (Extinguishment of PCs held by Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.65 480.92 Td (\(132) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.80 480.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.95 480.92 Td (\(41) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.80 480.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 396.65 480.92 Td (\(173) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.80 480.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 452.95 480.92 Td (\(14) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 463.80 480.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.80 480.92 Td (259) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 480.92 Td (245) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 70.50 465.92 Td (Total mortgage-related securities, net) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 302.80 465.92 Td (359) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 348.15 465.92 Td (\(908) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 363.80 465.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 396.15 465.92 Td (\(549) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 411.80 465.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 450.80 465.92 Td (109) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 496.15 465.92 Td (\(724) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 511.80 465.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 544.15 465.92 Td (\(615) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 559.80 465.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 450.92 Td (Non-mortgage-related securities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.80 450.92 Td (146) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.15 450.92 Td (23) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.80 450.92 Td (169) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.80 450.92 Td (161) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.15 450.92 Td (14) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 450.92 Td (175) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 436.92 Td (Loans held by consolidated trusts) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.80 436.92 Td (767) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 344.35 436.92 Td (2,370) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 392.35 436.92 Td (3,137) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.80 436.92 Td (609) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 492.35 436.92 Td (2,720) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 436.92 Td (3,329) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 421.92 Td (Loans held by Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 304.95 421.92 Td (\(28) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.80 421.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.65 421.92 Td (\(807) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.80 421.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 396.65 421.92 Td (\(835) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.80 421.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.80 421.92 Td (165) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.65 421.92 Td (\(799) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 421.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.65 421.92 Td (\(634) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 559.80 421.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 76.50 406.92 Td (Total interest-earning assets) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 296.35 406.92 Td (1,733) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 350.80 406.92 Td (514) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 392.35 406.92 Td (2,247) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 444.35 406.92 Td (1,433) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 492.35 406.92 Td (1,209) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 540.35 406.92 Td (2,642) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 391.92 Td (Interest-bearing liabilities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 377.92 Td (Debt securities of consolidated trusts including PCs held by) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 368.92 Td (Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 294.15 374.92 Td (\(1,902) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.80 374.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 342.15 374.92 Td (\(2,144) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.80 374.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 390.15 374.92 Td (\(4,046) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.80 374.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.65 374.92 Td (\(508) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 463.80 374.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 490.15 374.92 Td (\(2,304) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 374.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 538.15 374.92 Td (\(2,812) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 559.80 374.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 356.92 Td (Extinguishment of PCs held by Freddie Mac) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.80 356.92 Td (132) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.15 356.92 Td (41) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.80 356.92 Td (173) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 455.15 356.92 Td (14) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.65 356.92 Td (\(259) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 511.80 356.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.65 356.92 Td (\(245) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 559.80 356.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 342.92 Td (Total debt securities of consolidated trusts held by) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 333.92 Td (third parties) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 293.65 339.92 Td (\(1,770) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 315.80 339.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 341.65 339.92 Td (\(2,103) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 363.80 339.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 389.65 339.92 Td (\(3,873) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 411.80 339.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 448.15 339.92 Td (\(494) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 463.80 339.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 489.65 339.92 Td (\(2,563) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 511.80 339.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 537.65 339.92 Td (\(3,057) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 559.80 339.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 321.92 Td (Other debt:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 306.92 Td (Short-term debt) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 300.65 306.92 Td (\(665) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.80 306.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.15 306.92 Td (87) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 396.65 306.92 Td (\(578) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.80 306.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.65 306.92 Td (\(331) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 463.80 306.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.15 306.92 Td (66) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.65 306.92 Td (\(265) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 559.80 306.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 64.50 291.92 Td (Long-term debt) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 294.15 291.92 Td (\(1,005) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.80 291.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 344.35 291.92 Td (1,066) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 403.15 291.92 Td (61) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.65 291.92 Td (\(214) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 463.80 291.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.80 291.92 Td (679) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 291.92 Td (465) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 70.50 276.92 Td (Total other debt) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 293.65 276.92 Td (\(1,670) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 315.80 276.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 344.35 276.92 Td (1,153) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 396.15 276.92 Td (\(517) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 411.80 276.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 448.15 276.92 Td (\(545) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 463.80 276.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 498.80 276.92 Td (745) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 546.80 276.92 Td (200) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 76.50 261.92 Td (Total interest-bearing liabilities) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 293.65 261.92 Td (\(3,440) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 315.80 261.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 348.15 261.92 Td (\(950) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 363.80 261.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 389.65 261.92 Td (\(4,390) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 411.80 261.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 441.65 261.92 Td (\(1,039) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 463.80 261.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 489.65 261.92 Td (\(1,818) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 511.80 261.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 537.65 261.92 Td (\(2,857) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 559.80 261.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 246.92 Td (Net interest income) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 289.35 246.92 Td (\($1,707) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 315.80 246.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 343.85 246.92 Td (\($436) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 363.80 246.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 385.35 246.92 Td (\($2,143) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 411.80 246.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 446.50 246.92 Td ($394) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 491.85 246.92 Td (\($609) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 511.80 246.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 539.85 246.92 Td (\($215) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 559.80 246.92 Td (\)) Tj ET Q BT /F2 11.00 Tf ET BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 209.95 Td (Benefit \(Provision\) for Credit Losses) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 186.29 cm /I173 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 186.29 cm /I174 Do Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 188.55 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.23 188.55 Td ( - Increased benefit for credit losses during 2018, primarily driven by estimated losses ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 173.15 Td (from the hurricanes in 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 152.49 cm /I175 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 152.49 cm /I176 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 154.75 Td (2017 vs. 2016) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 137.23 154.75 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 140.29 154.75 Td (- Decline in benefit for credit losses in 2017 compared to 2016 primarily driven by:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 134.09 cm /I177 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 134.09 cm /I178 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 136.35 Td (The negative effects of the hurricanes in 2017;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 115.69 cm /I179 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 115.69 cm /I180 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 117.95 Td (Decrease in the accretion of TDR concessions due to a significant increase in the reclassification ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 102.55 Td (of reperforming loans from held-for-investment to held-for-sale; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 81.89 cm /I181 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 81.89 cm /I182 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 84.15 Td (Change in accounting policy that was elected on January 1, 2017 for loan reclassification from ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 68.75 Td (held-for-investment to held-for-sale. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 287.97 68.75 Td (Note 4) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 325.70 68.75 Td ( for further information about this change.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 50.35 Td (The decline was partially offset by improvement in our estimated loss severity.) Tj ET Q endstream endobj 51 0 obj <> endobj 52 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (21) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 731.30 Td (Guarantee Fee Income ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 709.90 Td (Guarantee fee income consists of guarantee fees earned from guarantees to third parties and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.50 Td (securitization trusts that we do not consolidate, and relates primarily to multifamily securitizations. For ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 679.10 Td (additional details, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 159.31 679.10 Td (Our Business Segments -) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 303.96 679.10 Td ( ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 307.02 679.10 Td (Multifamily - Securitization, Guarantee, and ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 663.70 Td (Other Risk Transfer Products) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 215.56 663.70 Td (. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 640.04 cm /I183 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 640.04 cm /I184 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 642.30 Td (2018 vs. 2017 and 2017 vs. 2016) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 232.64 642.30 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 235.70 642.30 Td (- Increased due to the continued growth in the multifamily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 626.90 Td (guarantee portfolio. ) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 597.50 Td (Mortgage Loans Gains \(Losses\)) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 576.10 Td (Mortgage loans gains \(losses\) consists of the following:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 555.44 cm /I185 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 555.44 cm /I186 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 557.70 Td (Gains \(losses\) on certain mortgage loan purchase commitments) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 403.08 557.70 Td ( - represents the change in fair ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 542.30 Td (value between the commitment date and settlement date for certain multifamily loan purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 526.90 Td (commitments for which we have elected the fair value option.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 506.24 cm /I187 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 506.24 cm /I188 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 508.50 Td (Gains \(losses\) on mortgage loans) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 242.26 508.50 Td ( - includes changes in fair value on held-for-sale loans, and loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 493.10 Td (for which we have elected the fair value option while held in our mortgage-related investments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 477.70 Td (portfolio, as well as any gains and losses on the sales of these loans.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 456.30 Td (Mortgage loans gains \(losses\) are affected by a number of factors, including:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 435.64 cm /I189 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 435.64 cm /I190 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 437.90 Td (Volume of held-for-sale single-family seasoned mortgage loans;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 417.24 cm /I191 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 417.24 cm /I192 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 419.50 Td (Volume of multifamily loan purchase commitments and mortgage loans for which we have elected ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 404.10 Td (the fair value option; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 383.44 cm /I193 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 383.44 cm /I194 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 385.70 Td (Changes in interest rates and market spreads.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 364.30 Td (The table below presents the components of mortgage loans gains \(losses\). ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 342.90 Td (Table 6 - Components of Mortgage Loans Gains \(Losses\)) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 378.00 326.40 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 239.00 311.40 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 378.00 311.40 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 472.00 311.40 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 49.00 296.40 186.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 239.00 296.40 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 284.00 296.40 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 329.00 296.40 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 378.00 296.40 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 423.00 296.40 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 472.00 296.40 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 517.00 296.40 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 284 296.4 m 284 281.4 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 329 296.4 m 329 281.4 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 423 296.4 m 423 281.4 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 517 296.4 m 517 281.4 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 251.39999999999998 m 235 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 237.39999999999998 m 235 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 235.39999999999998 m 235 235.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 251.39999999999998 m 284 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 237.39999999999998 m 284 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 235.39999999999998 m 284 235.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 251.39999999999998 m 329 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 237.39999999999998 m 329 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 235.39999999999998 m 329 235.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 251.39999999999998 m 374 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 237.39999999999998 m 374 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 235.39999999999998 m 374 235.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 251.39999999999998 m 423 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 237.39999999999998 m 423 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 235.39999999999998 m 423 235.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 251.39999999999998 m 468 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 237.39999999999998 m 468 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 235.39999999999998 m 468 235.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 251.39999999999998 m 517 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 237.39999999999998 m 517 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 235.39999999999998 m 517 235.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 251.39999999999998 m 562 251.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 237.39999999999998 m 562 237.39999999999998 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 235.39999999999998 m 562 235.39999999999998 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 424.90 316.76 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 255.60 301.76 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.45 301.76 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 301.76 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 51.50 286.19 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 252.35 286.47 Td (2018) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 297.35 286.47 Td (2017) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 342.35 286.47 Td (2016) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 397.80 286.47 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 441.45 286.47 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 491.80 286.47 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 535.45 286.47 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.50 271.47 Td (Gains \(losses\) on certain loan purchase commitments) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 263.50 271.47 Td ($777) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.00 271.47 Td ($1,098) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 353.50 271.47 Td ($663) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 400.35 271.47 Td (\($321) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 419.80 271.47 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.95 271.47 Td (\(29) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.45 271.47 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.50 271.47 Td ($435) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 545.80 271.47 Td (66) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 271.47 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 256.47 Td (Gains \(losses\) on mortgage loans) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 269.95 256.47 Td (\(53) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 256.47 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 312.80 256.47 Td (928) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.65 256.47 Td (\(463) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 256.47 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.65 256.47 Td (\(981) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 419.80 256.47 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 442.65 256.47 Td (\(106) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.80 256.47 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 494.35 256.47 Td (1,391) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.45 256.47 Td (300) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 51.50 241.47 Td (Mortgage loans gains \(losses\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 263.50 241.47 Td ($724) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 302.00 241.47 Td ($2,026) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 353.50 241.47 Td ($200) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 393.35 241.47 Td (\($1,302) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 419.80 241.47 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 446.45 241.47 Td (\(64) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 457.80 241.47 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 490.00 241.47 Td ($1,826) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 541.45 241.47 Td (913) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 554.45 241.47 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 217.70 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 197.04 cm /I195 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 197.04 cm /I196 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 199.30 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 138.44 199.30 Td ( - Gains decreased due to fair value losses on multifamily mortgage loans and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 183.90 Td (commitments as a result of spread widening, coupled with higher fair value losses on single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 168.50 Td (seasoned loans.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 147.84 cm /I197 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 147.84 cm /I198 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 150.10 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 138.44 150.10 Td ( - Gains increased due to:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 129.44 cm /I199 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 129.44 cm /I200 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 131.70 Td (Higher average balances of multifamily held-for-sale commitments driven by strong demand for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 116.30 Td (multifamily loan products;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 95.64 cm /I201 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 95.64 cm /I202 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 97.90 Td (Higher volume of single-family reperforming loan sales; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 77.24 cm /I203 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 77.24 cm /I204 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 79.50 Td (Lower losses recognized on the reclassification of seriously delinquent loans from held-for-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 64.10 Td (investment to held-for-sale as a result of an accounting policy change. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 455.72 64.10 Td (Note 4) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 493.45 64.10 Td ( for more ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 48.70 Td (information. ) Tj ET Q endstream endobj 53 0 obj <> endobj 54 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (22) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 731.30 Td (Investment Securities Gains \(Losses\)) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 709.90 Td (Investment securities gains \(losses\) consists of the following:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 689.24 cm /I205 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 689.24 cm /I206 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 691.50 Td (Net impairment of available-for-sale-securities recognized in earnings ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 436.83 691.50 Td (- includes the portion of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 676.10 Td (other-than-temporary impairment on available-for-sale securities recognized in earnings. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 655.44 cm /I207 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 655.44 cm /I208 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 657.70 Td (Other gains \(losses\) on investment securities recognized in earnings) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 425.10 657.70 Td ( - includes fair value gains ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 642.30 Td (and losses recognized on trading securities and the realized gains and losses on the sale of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 626.90 Td (available-for-sale securities.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 605.50 Td (Investment securities gains \(losses\) are affected by a number of factors, including:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 584.84 cm /I209 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 584.84 cm /I210 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 587.10 Td (Volume of sales of our available-for-sale securities;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 566.44 cm /I211 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 566.44 cm /I212 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 568.70 Td (Volume of available-for-sale securities deemed to be other-than-temporarily impaired and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 553.30 Td (amount of the impairment; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 532.64 cm /I213 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 532.64 cm /I214 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 534.90 Td (Changes in interest rates and market spreads.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 513.50 Td ( The table below presents the components of investment securities gains \(losses\). ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 492.10 Td (Table 7 - Components of Investment Securities Gains \(Losses\)) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 378.00 475.60 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 239.00 460.60 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 378.00 460.60 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 472.00 460.60 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 49.00 445.60 186.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 239.00 445.60 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 284.00 445.60 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 329.00 445.60 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 378.00 445.60 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 423.00 445.60 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 472.00 445.60 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 517.00 445.60 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 284 445.6 m 284 430.6 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 329 445.6 m 329 430.6 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 423 445.6 m 423 430.6 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 517 445.6 m 517 430.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 382.6 m 235 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 368.6 m 235 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 366.6 m 235 366.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 382.6 m 284 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 368.6 m 284 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 366.6 m 284 366.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 382.6 m 329 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 368.6 m 329 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 366.6 m 329 366.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 382.6 m 374 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 368.6 m 374 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 366.6 m 374 366.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 382.6 m 423 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 368.6 m 423 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 366.6 m 423 366.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 382.6 m 468 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 368.6 m 468 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 366.6 m 468 366.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 382.6 m 517 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 368.6 m 517 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 366.6 m 517 366.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 382.6 m 562 382.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 368.6 m 562 368.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 366.6 m 562 366.6 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 424.90 465.96 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 255.60 450.96 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.45 450.96 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 450.96 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 51.50 435.39 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 252.35 435.67 Td (2018) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 297.35 435.67 Td (2017) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 342.35 435.67 Td (2016) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 397.80 435.67 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 441.45 435.67 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 491.80 435.67 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 535.45 435.67 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.50 420.67 Td (Net impairment of available-for-sale securities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 411.67 Td (recognized in earnings) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 265.65 411.67 Td (\($12) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 411.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 310.65 411.67 Td (\($18) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 411.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 351.35 411.67 Td (\($191) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 411.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.15 411.67 Td ($6) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 449.15 411.67 Td (33) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 411.67 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.50 411.67 Td ($173) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 545.80 411.67 Td (91) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 411.67 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 396.67 Td (Other gains \(losses\) on investment securities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 387.67 Td (recognized in earnings) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 265.65 387.67 Td (\(683) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 387.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 306.35 387.67 Td (1,054) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 359.95 387.67 Td (\(78) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 387.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.15 387.67 Td (\(1,737) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 419.80 387.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 442.65 387.67 Td (\(165) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.80 387.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 494.35 387.67 Td (1,132) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 535.00 387.67 Td (1,451) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 51.50 372.67 Td (Investment securities gains \(losses\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 260.85 372.67 Td (\($695) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 280.80 372.67 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 302.00 372.67 Td ($1,036) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 350.85 372.67 Td (\($269) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 370.80 372.67 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 393.35 372.67 Td (\($1,731) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 419.80 372.67 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 442.15 372.67 Td (\(167) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 457.80 372.67 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 490.00 372.67 Td ($1,305) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 541.45 372.67 Td (485) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 554.45 372.67 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 348.90 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 328.24 cm /I215 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 328.24 cm /I216 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 330.50 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 138.44 330.50 Td ( - Shifted to losses during 2018 from gains during 2017 primarily driven by higher ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 315.10 Td (losses on trading securities due to increasing interest rates and spread widening during 2018, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 299.70 Td (combined with lower volume of sales at gains of non-agency mortgage-related securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 279.04 cm /I217 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 279.04 cm /I218 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 281.30 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 138.44 281.30 Td ( - Improved primarily due to:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 257.64 cm /I219 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 257.64 cm /I220 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 259.90 Td (Lower losses on trading securities as long-term interest rates increased less during 2017 than ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 244.50 Td (during 2016;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 223.84 cm /I221 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 223.84 cm /I222 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 226.10 Td (Larger gains on sales of available-for-sale securities due to additional spread tightening during ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 210.70 Td (2017; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 190.04 cm /I223 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 190.04 cm /I224 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 192.30 Td (Lower losses on impaired securities primarily due to a decline in the population of non-agency ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 176.90 Td (mortgage-related securities.) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 147.50 Td (Debt Gains \(Losses\)) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 126.10 Td (Debt gains \(losses\) consists of the following:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 105.44 cm /I225 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 105.44 cm /I226 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 107.70 Td (Fair value changes ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 168.49 107.70 Td (- includes the gains and losses on debt for which we have elected the fair value ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 92.30 Td (option, primarily certain STACR debt notes. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 71.64 cm /I227 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 71.64 cm /I228 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 73.90 Td (Gains \(losses\) on extinguishment of debt) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 280.53 73.90 Td ( - represents the difference between the consideration ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 58.50 Td (paid and the debt carrying value when we purchase debt securities of consolidated trusts \(i.e., PCs\) ) Tj ET Q endstream endobj 55 0 obj <> endobj 56 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (23) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 739.15 Td (as investments in our mortgage-related investments portfolio and when we repurchase or call other ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.75 Td (debt.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 702.35 Td (Debt gains \(losses\) are affected by a number of factors, including:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 681.69 cm /I229 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 681.69 cm /I230 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 683.95 Td (Changes in the market spreads between debt yields and benchmark interest rates and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 663.29 cm /I231 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 663.29 cm /I232 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 665.55 Td (Amount and type of debt selected for repurchase based on our investment and funding strategies, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 650.15 Td (including our efforts to support the liquidity and price performance of our PCs.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 628.75 Td (The table below presents the components of debt gains \(losses\). ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 607.35 Td (Table 8 - Components of Debt Gains \(Losses\)) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 378.00 590.85 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 239.00 575.85 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 378.00 575.85 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 472.00 575.85 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 49.00 560.85 186.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 239.00 560.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 284.00 560.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 329.00 560.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 378.00 560.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 423.00 560.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 472.00 560.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 517.00 560.85 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 284 560.85 m 284 545.85 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 329 560.85 m 329 545.85 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 423 560.85 m 423 545.85 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 517 560.85 m 517 545.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 515.85 m 235 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 501.85 m 235 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 499.85 m 235 499.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 515.85 m 284 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 501.85 m 284 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 499.85 m 284 499.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 515.85 m 329 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 501.85 m 329 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 499.85 m 329 499.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 515.85 m 374 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 501.85 m 374 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 499.85 m 374 499.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 515.85 m 423 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 501.85 m 423 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 499.85 m 423 499.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 515.85 m 468 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 501.85 m 468 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 499.85 m 468 499.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 515.85 m 517 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 501.85 m 517 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 499.85 m 517 499.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 515.85 m 562 515.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 501.85 m 562 501.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 499.85 m 562 499.85 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 424.90 581.21 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 255.60 566.21 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.45 566.21 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 566.21 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 51.50 550.64 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 252.35 550.92 Td (2018) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 297.35 550.92 Td (2017) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 342.35 550.92 Td (2016) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 397.80 550.92 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 441.45 550.92 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 491.80 550.92 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 535.45 550.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.50 535.92 Td (Fair value changes) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 263.50 535.92 Td ($142) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 306.35 535.92 Td (\($190) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 535.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 351.35 535.92 Td (\($262) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 535.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.50 535.92 Td ($332) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 447.45 535.92 Td (175) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 535.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 535.92 Td ($72) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 545.80 535.92 Td (27) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 535.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 520.92 Td (Gains \(losses\) on extinguishment of debt) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.80 520.92 Td (578) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 312.80 520.92 Td (341) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.65 520.92 Td (\(211) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 520.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 406.80 520.92 Td (237) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.80 520.92 Td (70) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 520.92 Td (552) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.45 520.92 Td (262) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 51.50 505.92 Td (Debt gains \(losses\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 263.50 505.92 Td ($720) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 308.50 505.92 Td ($151) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 350.85 505.92 Td (\($473) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 370.80 505.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 402.50 505.92 Td ($569) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 505.92 Td (377) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 460.45 505.92 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 496.50 505.92 Td ($624) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 541.45 505.92 Td (132) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 554.45 505.92 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 482.15 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 461.49 cm /I233 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 461.49 cm /I234 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 463.75 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 138.44 463.75 Td ( - Improved primarily due to an increase in gains from the extinguishment of fixed-rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 448.35 Td (PCs, as market interest rates increased between the time of issuance and repurchase, coupled with ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 432.95 Td (fair value gains on STACR debt notes as a result of spread widening during 2018.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 412.29 cm /I235 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 412.29 cm /I236 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 414.55 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 138.44 414.55 Td ( - Improved primarily due to an increase in gains from the extinguishment of fixed-rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 399.15 Td (PCs, as market interest rates increased between the time of issuance and repurchase, coupled with ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 383.75 Td (smaller fair value losses on STACR debt notes, as spreads tightened less during 2017 than during ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 368.35 Td (2016.) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 335.95 Td (Derivative Gains \(Losses\)) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 314.55 Td (Derivative instruments are a key component of our interest-rate risk management strategy. We use ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 299.15 Td (derivatives to economically hedge our interest-rate risk exposure. We primarily use interest-rate swaps, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 283.75 Td (futures, and option-based derivatives, such as swaptions, to manage our exposure to changes in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 268.35 Td (interest-rates. We consider the cost of derivatives used in interest-rate risk management to be an ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 252.95 Td (inherent part of the cost of funding our mortgage-related investments portfolio. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 231.55 Td (In addition, we routinely enter into commitments to purchase and sell loans and mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 216.15 Td (securities. The majority of these commitments are accounted for as derivative instruments.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 194.75 Td (We continue to align our derivative portfolio with the changing duration of our assets and liabilities so as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 179.35 Td (to economically hedge them. We manage our exposure to interest-rate risk on an economic basis to a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 163.95 Td (low level as measured by our models. We believe the impact of derivatives on our GAAP financial results ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 148.55 Td (should be considered in the context of our overall interest-rate risk profile, including our PMVS and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 133.15 Td (duration gap results. For more information about our interest-rate risk management activities and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 117.75 Td (sensitivity of reported GAAP earnings to those activities, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 348.56 117.75 Td (Risk Management - Market Risk) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 530.96 117.75 Td (.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 96.35 Td (Derivative gains \(losses\) consists of the following:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 75.69 cm /I237 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 75.69 cm /I238 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 77.95 Td (Fair value changes) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 165.43 77.95 Td ( - represents changes in the fair value of our derivatives while not designated in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 62.55 Td (hedging relationships based on market conditions at the end of the period or at the time the ) Tj ET Q endstream endobj 57 0 obj <> endobj 58 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (24) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 741.15 Td (derivative instrument is terminated. These amounts may or may not be realized over time, depending ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 725.75 Td (on future changes in market conditions and the terms of our derivative instruments.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 705.09 cm /I239 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 705.09 cm /I240 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 707.35 Td (Accrual of periodic cash settlements) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 259.74 707.35 Td ( - consists of the net amount we accrue during a period for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 691.95 Td (interest-rate swap payments that we will make or receive for derivatives while not designated in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 676.55 Td (hedging relationships. This accrual represents the ongoing cost of our hedging activities, and is ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 661.15 Td (economically equivalent to interest expense. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 639.75 Td (We apply fair value hedge accounting to certain single-family mortgage loans and long-term debt to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 624.35 Td (reduce our GAAP earnings volatility. For the first three quarters of 2017, we included gains and losses on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 608.95 Td (derivatives designated in qualifying hedge relationships in other income and the accrual of periodic cash ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 593.55 Td (settlements on derivatives in qualifying hedge relationships in derivatives gains \(losses\). Beginning in 4Q ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 578.15 Td (2017, due to the adoption of amended hedge accounting guidance, we include gains and losses and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 562.75 Td (accrual of periodic cash settlements on derivatives designated in qualifying hedge relationships in the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 547.35 Td (same line used to present the earnings effect of the hedged item. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 394.00 547.35 Td (Note 9) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 431.73 547.35 Td ( for more information on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 531.95 Td (hedge accounting and the adoption of amended hedge accounting guidance during 2017.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 510.55 Td (Derivative gains \(losses\) are affected by a number of factors, including:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 489.89 cm /I241 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 489.89 cm /I242 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 492.15 Td (Changes in interest rates) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 198.73 492.15 Td ( - Our primary derivative instruments are interest-rate swaps, including ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 476.75 Td (pay-fixed and receive-fixed interest-rate swaps. With a pay-fixed interest-rate swap, we pay a fixed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 461.35 Td (rate of interest and receive a variable rate of interest based on a specified notional balance \(the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 445.95 Td (notional balance is for calculation purposes only\). As interest rates decline, we recognize derivative ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 430.55 Td (losses, as the amount of interest we pay remains fixed, and the amount of interest we receive ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 415.15 Td (declines. As rates rise, we recognize derivative gains, as the amount of interest we pay remains ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 399.75 Td (fixed, but the amount of interest we receive increases. With a receive-fixed interest-rate swap, the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 384.35 Td (opposite results occur.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 363.69 cm /I243 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 363.69 cm /I244 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 365.95 Td (Implied volatility) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 152.76 365.95 Td ( - Many of our assets and liabilities have embedded prepayment options. We use ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 350.55 Td (option-based derivatives, including swaptions, to economically hedge the prepayment options ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 335.15 Td (embedded in our mortgage assets and callable debt. Fair value gains and losses on swaptions are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 319.75 Td (sensitive to changes in both interest rates and implied volatility, which reflects the market's ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 304.35 Td (expectation of future changes in interest rates. Assuming all other factors are unchanged, including ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 288.95 Td (interest rates, purchased swaptions generally become more valuable as implied volatility increases ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 273.55 Td (and less valuable as implied volatility decreases, with the opposite being true for written swaptions.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 252.89 cm /I245 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 252.89 cm /I246 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 255.15 Td (Changes in the shape of the yield curve) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 274.00 255.15 Td ( - We own assets and have outstanding debt with different ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 239.75 Td (cash flows along the yield curve. We use derivatives to hedge the yield exposure of assets and debt, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 224.35 Td (resulting in derivatives with different maturities. As a result, changes in the shape of the yield curve ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 208.95 Td (will affect our derivative gains \(losses\). ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 188.29 cm /I247 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 188.29 cm /I248 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 190.55 Td (Changes in the composition of our derivative portfolio) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 349.82 190.55 Td ( - The mix and balance of our derivative ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 175.15 Td (portfolio changes from period to period as we enter into or terminate derivative instruments to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 159.75 Td (respond to changes in interest rates and changes in the balances and modeled characteristics of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 144.35 Td (assets and liabilities. Changes in the composition of our derivative portfolio will affect the derivative ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 128.95 Td (gains and losses we recognize in a given period, thereby affecting the volatility of comprehensive ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 113.55 Td (income.) Tj ET Q endstream endobj 59 0 obj <> endobj 60 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (25) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (The table below presents the components of derivative gains \(losses\).) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 717.75 Td (Table 9 - Components of Derivative Gains \(Losses\)) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 378.00 701.25 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 239.00 686.25 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 378.00 686.25 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 472.00 686.25 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 49.00 671.25 186.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 239.00 671.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 284.00 671.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 329.00 671.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 378.00 671.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 423.00 671.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 472.00 671.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 517.00 671.25 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 284 671.25 m 284 656.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 329 671.25 m 329 656.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 423 671.25 m 423 656.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 517 671.25 m 517 656.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 596.25 m 235 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 582.25 m 235 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 580.25 m 235 580.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 596.25 m 284 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 582.25 m 284 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 580.25 m 284 580.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 596.25 m 329 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 582.25 m 329 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 580.25 m 329 580.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 596.25 m 374 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 582.25 m 374 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 580.25 m 374 580.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 596.25 m 423 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 582.25 m 423 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 580.25 m 423 580.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 596.25 m 468 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 582.25 m 468 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 580.25 m 468 580.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 596.25 m 517 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 582.25 m 517 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 580.25 m 517 580.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 596.25 m 562 596.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 582.25 m 562 582.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 580.25 m 562 580.25 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 424.90 691.61 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 255.60 676.61 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.45 676.61 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 676.61 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 51.50 661.04 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 252.35 661.32 Td (2018) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 297.35 661.32 Td (2017) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 342.35 661.32 Td (2016) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 397.80 661.32 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 441.45 661.32 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 491.80 661.32 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 535.45 661.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.50 646.32 Td (Fair value change in interest-rate swaps) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 257.00 646.32 Td ($1,422) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 308.50 646.32 Td ($626) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 353.50 646.32 Td ($178) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.50 646.32 Td ($796) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 447.45 646.32 Td (127) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 646.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.50 646.32 Td ($448) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 538.80 646.32 Td (252) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 646.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 631.32 Td (Fair value change in option-based derivatives) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 265.65 631.32 Td (\(630) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 631.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 304.15 631.32 Td (\(1,041) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 631.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 631.32 Td (421) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 406.80 631.32 Td (411) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.80 631.32 Td (39) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 492.15 631.32 Td (\(1,462) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 631.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.65 631.32 Td (\(347) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 551.80 631.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 616.32 Td (Fair value change in other derivatives) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.80 616.32 Td (619) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.15 616.32 Td (17) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 616.32 Td (887) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 406.80 616.32 Td (602) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 441.00 616.32 Td (3,541) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 616.32 Td (\(870) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 616.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.95 616.32 Td (\(98) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 551.80 616.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 601.32 Td (Accrual of periodic cash settlements) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 265.65 601.32 Td (\(141) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 601.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 304.15 601.32 Td (\(1,590) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 601.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 349.15 601.32 Td (\(1,760) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 601.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 400.35 601.32 Td (1,449) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.80 601.32 Td (91) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 601.32 Td (170) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 543.15 601.32 Td (10) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 51.50 586.32 Td (Derivative gains \(losses\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 257.00 586.32 Td ($1,270) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 299.35 586.32 Td (\($1,988) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 325.80 586.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 350.85 586.32 Td (\($274) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 370.80 586.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 396.00 586.32 Td ($3,258) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 586.32 Td (164) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 460.45 586.32 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 487.35 586.32 Td (\($1,714) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 513.80 586.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 536.15 586.32 Td (\(626) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 551.80 586.32 Td (\)%) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 562.55 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 541.89 cm /I249 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 541.89 cm /I250 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 544.15 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.23 544.15 Td ( - Increases in long-term rates during 2018 resulted in derivative fair value gains ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 528.75 Td (compared to derivative fair value losses during 2017. The interest rate increases during 2018 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 513.35 Td (resulted in fair value gains on our pay-fixed interest rate swaps, forward commitments to issue PCs, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 497.95 Td (and futures, partially offset by fair value losses on our receive-fixed swaps and certain of our option-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 482.55 Td (based derivatives. As a result of the adoption of amended hedge accounting guidance in 4Q 2017, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 467.15 Td (fair value changes on derivatives in qualifying hedge relationships have been recorded within net ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 451.75 Td (interest income. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 428.09 cm /I251 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 428.09 cm /I252 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 430.35 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.23 430.35 Td ( - Increased losses driven by lower levels of volatility during 2017, resulting in larger ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 414.95 Td (losses in our options portfolio, coupled with lower fair value gains on our pay-fixed interest rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 399.55 Td (swaps as long-term interest rates increased less during 2017 than during 2016. This was partially ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 384.15 Td (offset by reduced fair value losses on our receive-fixed interest rate swaps.) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 351.75 Td (Other Income ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 328.09 cm /I253 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 328.09 cm /I254 Do Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 330.35 Td (2018 vs. 2017 and 2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 232.64 330.35 Td ( - Primarily reflected the recognition of a $0.3 billion gain during ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 314.95 Td (2018 from a judgment in litigation against Nomura Holding America, Inc. \(Nomura\) and $4.5 billion in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 299.55 Td (proceeds received during 2017 from a litigation settlement with the Royal Bank of Scotland Group ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 284.15 Td (plc \(RBS\) related to certain of our non-agency mortgage related securities. We did not have any ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 268.75 Td (significant judgments or settlements during 2016. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 335.25 268.75 Td (Note 14) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 380.33 268.75 Td ( for additional information on the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 253.35 Td (Nomura judgment and RBS settlement.) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 223.95 Td (Income Tax Expense ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 200.29 cm /I255 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 200.29 cm /I256 Do Q BT /F1 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 67.50 202.55 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.23 202.55 Td ( - Decreased due to the impact of the Tax Cuts and Jobs Act enacted in December ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 187.15 Td (2017, which lowered the statutory corporate income tax rate from 35% in 2017 to 21% in 2018 and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 171.75 Td (required us to measure our net deferred tax asset using the reduced rate and recognize a charge to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 156.35 Td (income tax expense of $5.4 billion in 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 135.69 cm /I257 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 135.69 cm /I258 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 137.95 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.23 137.95 Td ( - Increased primarily due to the $5.4 billion charge to income tax expense resulting ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 122.55 Td (from the enactment of the Tax Cuts and Jobs Act.) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 90.15 Td (Other Comprehensive Income \(Loss\)) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 68.75 Td (Our investments in securities classified as available-for-sale are measured at fair value on our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 53.35 Td (consolidated balance sheets. The fair value of these securities is primarily affected by changes in ) Tj ET Q endstream endobj 61 0 obj <> endobj 62 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 244 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 244 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 422.80 764.07 Td (Consolidated Results of Operations) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (26) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (interest rates, market spreads, and the movement of these securities towards maturity. All unrealized ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (gains and losses on these securities are excluded from earnings and reported in other comprehensive ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 708.35 Td (income until realized. We reclassify our unrealized gains and losses from AOCI to earnings upon the sale ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 692.95 Td (of the securities or if the securities are determined to be other-than-temporarily impaired.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.55 Td (If, subsequent to the recognition of other-than-temporary impairment, our expectation of the cash flows ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 656.15 Td (we will receive on a previously impaired security has significantly increased, we will accrete that increase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 640.75 Td (in cash flows into earnings. The accretion into earnings will generally reduce the amount of unrealized ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 625.35 Td (gains that we would have otherwise recognized if not for the accretion. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 603.95 Td (The following table presents the attribution of the other comprehensive income \(loss\) reported on our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 588.55 Td (consolidated statements of comprehensive income. ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 567.15 Td (Table 10 - Other Comprehensive Income \(Loss\)) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 377.00 550.65 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 237.00 535.65 136.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 377.00 535.65 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 471.00 535.65 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 520.65 183.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 237.00 520.65 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 282.00 520.65 46.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 328.00 520.65 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 377.00 520.65 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 422.00 520.65 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 471.00 520.65 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 516.00 520.65 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 282 520.65 m 282 505.65 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 328 520.65 m 328 505.65 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 422 520.65 m 422 505.65 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 516 520.65 m 516 505.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 422.65 m 233 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 422.65 m 282 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 282 422.65 m 328 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 422.65 m 373 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 377 422.65 m 422 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 422 422.65 m 467 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 422.65 m 516 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 516 422.65 m 561 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 422 422.65 m 467 422.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 408.65 m 233 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 395.65 m 233 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 393.65 m 233 393.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 408.65 m 282 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 395.65 m 282 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 393.65 m 282 393.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 282 408.65 m 328 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 282 395.65 m 328 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 282 393.65 m 328 393.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 408.65 m 373 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 395.65 m 373 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 328 393.65 m 373 393.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 377 408.65 m 422 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 377 395.65 m 422 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 377 393.65 m 422 393.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 422 408.65 m 467 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 422 395.65 m 467 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 422 393.65 m 467 393.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 408.65 m 516 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 395.65 m 516 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 471 393.65 m 516 393.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 516 408.65 m 561 408.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 516 395.65 m 561 395.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 516 393.65 m 561 393.65 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 423.90 541.01 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 254.10 526.01 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 394.45 526.01 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 488.45 526.01 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 510.44 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 249.40 511.01 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 294.90 511.01 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 340.40 511.01 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 396.60 511.01 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 440.10 511.01 Td (%) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 490.60 511.01 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 534.10 511.01 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 496.72 Td (Other comprehensive income \(loss\), excluding) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 487.72 Td (certain items) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 259.35 487.72 Td (\($345) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 278.80 487.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 301.00 487.72 Td ($1,084) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.65 487.72 Td (\($29) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 369.80 487.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 392.85 487.72 Td (\($1,429) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 418.80 487.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 441.65 487.72 Td (\(132) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 457.45 487.72 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 489.00 487.72 Td ($1,113) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 534.00 487.72 Td (3,838) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 553.65 487.72 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 473.72 Td (Excluded items) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 459.72 Td (Accretion due to significant increases in expected) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 450.72 Td (cash flows on previously impaired available-for-) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 441.72 Td (sale securities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 263.65 450.72 Td (\(120) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 278.80 450.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 309.65 450.72 Td (\(164) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.80 450.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.65 450.72 Td (\(299) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 369.80 450.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.15 450.72 Td (44) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.15 450.72 Td (27) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 499.80 450.72 Td (135) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.80 450.72 Td (45) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 427.72 Td (Realized \(gains\) losses reclassified from AOCI) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 263.65 427.72 Td (\(148) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 278.80 427.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 309.65 427.72 Td (\(987) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.80 427.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 354.65 427.72 Td (\(369) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 369.80 427.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 405.80 427.72 Td (839) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 448.15 427.72 Td (85) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 497.65 427.72 Td (\(618) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 512.80 427.72 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 538.30 427.72 Td (\(167) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 553.45 427.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 413.72 Td (Total excluded items) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 263.15 413.72 Td (\(268) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 278.80 413.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 302.65 413.72 Td (\(1,151) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 324.80 413.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 354.15 413.72 Td (\(668) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 369.80 413.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 405.80 413.72 Td (883) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 448.15 413.72 Td (77) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 497.15 413.72 Td (\(483) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 512.80 413.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 542.10 413.72 Td (\(72) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 553.45 413.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 399.72 Td (Total other comprehensive income \(loss\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 258.85 399.72 Td (\($613) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 278.80 399.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 309.15 399.72 Td (\($67) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 324.80 399.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 349.85 399.72 Td (\($697) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 369.80 399.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 398.85 399.72 Td (\($546) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 418.80 399.72 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 441.15 399.72 Td (\(815) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 456.80 399.72 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 495.50 399.72 Td ($630) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 544.80 399.72 Td (90) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 553.45 399.72 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 373.75 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 353.09 cm /I259 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 353.09 cm /I260 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 355.35 Td (Other comprehensive income \(loss\), excluding certain items) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 334.69 cm /I261 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 334.69 cm /I262 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 336.95 Td (2018 vs. 2017) Tj ET Q BT /F12 11.00 Tf ET q 0 0 0 rg BT 155.02 336.95 Td ( - S) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 172.13 336.95 Td (hifted to losses in 2018 from income in 2017 primarily due to higher fair value ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 321.55 Td (losses due to increasing long-term interest rates during 2018, coupled with smaller spread-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 306.15 Td (related fair value gains driven by lower balances of non-agency mortgage-related securities. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 285.49 cm /I263 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 285.49 cm /I264 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 287.75 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 155.02 287.75 Td ( - Increased primarily due to market spread related gains as market spreads ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 272.35 Td (tightened more during 2017, coupled with smaller interest rate-related losses due to smaller ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 256.95 Td (increases in long-term interest rates during 2017.) Tj ET Q /GS0 gs q 18.00 0 0 11.74 49.50 233.29 cm /I265 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 235.55 Td (Excluded items:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 214.89 cm /I266 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 214.89 cm /I267 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 217.15 Td (Accretion due to significant increases in expected cash flows on previously impaired ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 201.75 Td (available-for-sale securities) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 181.09 cm /I268 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 181.09 cm /I269 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 183.35 Td (2018 vs. 2017 and 2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 250.42 183.35 Td ( - Decreased during both comparative periods primarily due to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 167.95 Td (a decline in the population of impaired securities. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 147.29 cm /I270 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 147.29 cm /I271 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 149.55 Td (Realized \(gains\) losses reclassified from AOCI) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 128.89 cm /I272 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 128.89 cm /I273 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 131.15 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 155.02 131.15 Td ( - Reflected smaller amounts of reclassified gains during 2018 due to lower sales ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 115.75 Td (of non-agency mortgage-related securities. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 95.09 cm /I274 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 95.09 cm /I275 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 85.50 97.35 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 155.02 97.35 Td ( - Reflected larger amounts of reclassified gains during 2017 due to additional ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 81.95 Td (spread tightening and an increase in sales of non-agency mortgage-related securities.) Tj ET Q endstream endobj 63 0 obj <> endobj 64 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50.5 764 m 235.5 764 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235.5 764 m 560.5 764 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 53.00 769.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 409.05 769.07 Td (Consolidated Balance Sheets Analysis) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (27) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 733.30 Td (CONSOLIDATED BALANCE SHEETS ) Tj ET Q BT /F7 22.00 Tf ET q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 706.90 Td (ANALYSIS) Tj ET Q BT /F12 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 685.50 Td (The table below compares our summarized consolidated balance sheets.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 664.10 Td (Table 11 - Summarized Consolidated Balance Sheets) Tj ET Q 0.4666666666666667 0.7411764705882353 0.27058823529411763 rg /GS0 gs 227.00 647.60 163.00 -15.00 re f /GS0 gs 0.4666666666666667 0.7411764705882353 0.27058823529411763 rg /GS0 gs 394.00 647.60 164.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 632.60 173.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 227.00 632.60 82.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 309.00 632.60 81.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 394.00 632.60 82.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 476.00 632.60 82.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 632.6 m 223 632.6 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 617.6 m 223 617.6 l s 1 1 1 RG /GS0 gs 3.00 w 0 i [] 0 d 0 J 0 j 3 M 309 632.6 m 309 617.6 l s 1 1 1 RG /GS0 gs 3.00 w 0 i [] 0 d 0 J 0 j 3 M 476 632.6 m 476 617.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 577.6 m 223 577.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 577.6 m 309 577.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 577.6 m 390 577.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 577.6 m 476 577.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 577.6 m 558 577.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 486.6 m 223 486.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 474.6 m 223 474.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 472.6 m 223 472.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 486.6 m 309 486.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 474.6 m 309 474.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 472.6 m 309 472.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 486.6 m 390 486.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 474.6 m 390 474.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 472.6 m 390 472.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 486.6 m 476 486.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 474.6 m 476 474.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 472.6 m 476 472.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 486.6 m 558 486.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 474.6 m 558 474.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 472.6 m 558 472.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 380.6 m 223 380.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 380.6 m 309 380.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 380.6 m 390 380.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 380.6 m 476 380.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 380.6 m 558 380.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 354.6 m 223 354.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 342.6 m 223 342.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 340.6 m 223 340.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 354.6 m 309 354.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 342.6 m 309 342.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 340.6 m 309 340.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 354.6 m 390 354.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 342.6 m 390 342.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 309 340.6 m 390 340.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 354.6 m 476 354.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 342.6 m 476 342.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 394 340.6 m 476 340.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 354.6 m 558 354.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 342.6 m 558 342.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 340.6 m 558 340.6 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 269.60 637.96 Td (As of December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 430.90 637.96 Td (Year Over Year Change) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 622.39 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 257.90 622.96 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 339.40 622.96 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 432.10 622.96 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 512.60 622.96 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 608.67 Td (Assets:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 595.67 Td (Cash and cash equivalents) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 141.28 598.82 Td (\(1\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 282.00 595.67 Td ($7,273) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 595.67 Td ($9,811) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.85 595.67 Td (\($2,538) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.80 595.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 595.67 Td (\(26) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.50 595.67 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 582.67 Td (Securities purchased under agreements to resell) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 282.00 582.67 Td (34,771) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 582.67 Td (55,903) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.85 582.67 Td (\(21,132) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.80 582.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 582.67 Td (\(38) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.50 582.67 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 58.50 568.67 Td (Subtotal) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 282.00 568.67 Td (42,044) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 363.00 568.67 Td (65,714) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 446.35 568.67 Td (\(23,670) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 472.80 568.67 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 537.15 568.67 Td (\(36) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 548.50 568.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 555.67 Td (Investments in securities, at fair value) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 282.00 555.67 Td (69,111) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 555.67 Td (84,318) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 446.85 555.67 Td (\(15,207) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.80 555.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 555.67 Td (\(18) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.50 555.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 542.67 Td (Mortgage loans, net) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 271.20 542.67 Td (1,926,978) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.20 542.67 Td (1,871,217) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 449.00 542.67 Td (55,761) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 542.67 Td (3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 529.67 Td (Accrued interest receivable) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 286.35 529.67 Td (6,728) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.35 529.67 Td (6,355) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.80 529.67 Td (373) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 529.67 Td (6) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 516.67 Td (Derivative assets, net) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 292.80 516.67 Td (335) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 373.80 516.67 Td (375) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 461.95 516.67 Td (\(40) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.80 516.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 516.67 Td (\(11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.50 516.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 503.67 Td (Deferred tax assets, net) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 286.35 503.67 Td (6,888) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.35 503.67 Td (8,107) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.15 503.67 Td (\(1,219) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.80 503.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 503.67 Td (\(15) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.50 503.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 490.67 Td (Other assets) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 282.00 490.67 Td (10,976) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 490.67 Td (13,690) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.15 490.67 Td (\(2,714) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.80 490.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 490.67 Td (\(20) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.50 490.67 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 477.67 Td (Total assets) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 266.90 477.67 Td ($2,063,060) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 347.90 477.67 Td ($2,049,776) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 444.70 477.67 Td ($13,284) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 544.15 477.67 Td (1) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 550.45 477.67 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 449.67 Td (Liabilities and Equity:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 436.67 Td (Liabilities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 423.67 Td (Accrued interest payable) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 282.00 423.67 Td ($6,652) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 423.67 Td ($6,221) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 455.50 423.67 Td ($431) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 423.67 Td (7) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 550.65 423.67 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 410.67 Td (Debt, net) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 271.20 410.67 Td (2,044,950) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.20 410.67 Td (2,034,630) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 449.00 410.67 Td (10,320) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.15 410.67 Td (1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 397.67 Td (Derivative liabilities, net) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 292.80 397.67 Td (583) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 373.80 397.67 Td (269) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.80 397.67 Td (314) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 535.50 397.67 Td (117) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 384.67 Td (Other liabilities) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 286.35 384.67 Td (6,398) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 367.35 384.67 Td (8,968) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.15 384.67 Td (\(2,570) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 472.80 384.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.65 384.67 Td (\(29) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.50 384.67 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 371.67 Td (Total liabilities) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 271.20 371.67 Td (2,058,583) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 352.20 371.67 Td (2,050,088) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 453.35 371.67 Td (8,495) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 539.50 371.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 358.67 Td (Total equity) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 286.35 358.67 Td (4,477) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.65 358.67 Td (\(312) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 386.80 358.67 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 453.35 358.67 Td (4,789) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 529.05 358.67 Td (1,535) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 345.67 Td (Total liabilities and equity) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 266.90 345.67 Td ($2,063,060) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 347.90 345.67 Td ($2,049,776) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 444.70 345.67 Td ($13,284) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 544.15 345.67 Td (1) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 550.45 345.67 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 328.30 Td (\(1\) The current and prior period presentation has been modified to include restricted cash and cash equivalents in this line item due to recently ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 317.50 Td (adopted accounting guidance. ) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 296.10 Td (Key Drivers:) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 274.70 Td (As of December 31, 2018 compared to December 31, 2017:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 254.04 cm /I276 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 254.04 cm /I277 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 256.30 Td (Cash and cash equivalents) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 207.94 256.30 Td ( and ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 232.60 256.30 Td (securities purchased under agreements to resell) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 486.26 256.30 Td ( declined on a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 240.90 Td (combined basis primarily due to lower near-term cash needs for fewer upcoming maturities and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 225.50 Td (anticipated calls of other debt.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 204.84 cm /I278 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 204.84 cm /I279 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 207.10 Td (Investments in securities, at fair value) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 266.68 207.10 Td ( decreased as we continued to reduce the mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 191.70 Td (investments portfolio during 2018 as required by the Purchase Agreement and FHFA.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 171.04 cm /I280 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 171.04 cm /I281 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 173.30 Td (Deferred tax assets, net ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 196.97 173.30 Td (decreased primarily due to an increase in long-term interest rates during ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 157.90 Td (2018, which caused the difference between the GAAP and tax basis of assets held for investment ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 142.50 Td (and derivative instruments to decline.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 121.84 cm /I282 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 121.84 cm /I283 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 124.10 Td (Total equity) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 127.87 124.10 Td ( increased primarily as a result of higher comprehensive income, combined with our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 108.70 Td (ability to retain equity as a result of an increase in the applicable Capital Reserve Amount, which was ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 93.30 Td ($3.0 billion as of January 1, 2018. ) Tj ET Q endstream endobj 65 0 obj <><>] /Rotate 0 /Contents 66 0 R>> endobj 66 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 374.45 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 472.62 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 475.12 764.07 Td (Segment Earnings) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (28) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 733.30 Td (OUR BUSINESS SEGMENTS) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 711.90 Td (As shown in the table below, we have three reportable segments, which are based on the way we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 696.50 Td (manage our business. Certain activities that are not part of a reportable segment are included in the All ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 681.10 Td (Other category.) Tj ET Q BT /F12 11.00 Tf ET q 0 0 0 rg BT 125.51 681.10 Td ( ) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 50.00 670.60 67.00 -27.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 117.00 670.60 188.00 -27.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 305.00 670.60 123.00 -27.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 428.00 670.60 134.00 -27.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 601.60 67.00 -76.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 117.00 601.60 188.00 -76.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 305.00 601.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 315.00 601.60 113.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 428.00 601.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 438.00 601.60 124.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 305.00 586.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 315.00 586.60 113.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 428.00 586.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 438.00 586.60 124.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 305.00 571.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 315.00 571.60 113.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 428.00 571.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 438.00 571.60 124.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 305.00 556.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 315.00 556.60 113.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 428.00 556.60 10.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 438.00 556.60 124.00 -15.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 305.00 541.60 10.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 315.00 541.60 113.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 428.00 541.60 10.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 438.00 541.60 124.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 444.60 67.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 117.00 444.60 188.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 305.00 444.60 10.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 315.00 444.60 113.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 428.00 444.60 10.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 438.00 444.60 124.00 -52.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 601.6 m 117 601.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 117 601.6 m 305 601.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 305 601.6 m 315 601.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 315 601.6 m 428 601.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 428 601.6 m 438 601.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 438 601.6 m 562 601.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 525.6 m 117 525.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 117 525.6 m 305 525.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 305 525.6 m 315 525.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 315 525.6 m 428 525.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 428 525.6 m 438 525.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 438 525.6 m 562 525.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 444.6 m 117 444.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 392.6 m 117 392.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 117 444.6 m 305 444.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 117 392.6 m 305 392.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 305 444.6 m 315 444.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 305 392.6 m 315 392.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 315 444.6 m 428 444.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 315 392.6 m 428 392.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 428 444.6 m 438 444.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 428 392.6 m 438 392.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 438 444.6 m 562 444.6 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 438 392.6 m 562 392.6 l s BT /F9 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 661.52 Td (Segment/) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 52.50 648.87 Td (Category) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 119.50 655.17 Td (Description) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 307.50 655.17 Td (Primary Revenue Drivers) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 430.50 655.17 Td (Primary Expense Drivers) Tj ET Q BT /F9 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 626.07 Td (Single-family) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 615.27 Td (Guarantee) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 631.47 Td (Reflects results from our purchase, securitization, and) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 620.67 Td (guarantee of single-family loans and the management) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 609.92 Td (of single-family mortgage credit risk) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 634.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 634.67 Td (Guarantee fee income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 634.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 634.67 Td (Credit-related expenses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 620.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 620.67 Td (Administrative expenses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 606.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 606.67 Td (Credit risk transfer expenses) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 561.67 Td (Multifamily) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 583.27 Td (Reflects results from our purchase, sale,) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 572.47 Td (securitization, and guarantee of multifamily loans and) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 561.72 Td (securities, our investments in those loans and) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 550.87 Td (securities, and the management of multifamily) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 540.12 Td (mortgage credit risk and market spread risk) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 592.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 592.67 Td (Net interest income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 592.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 592.67 Td (Losses on loans) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 577.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 577.67 Td (Guarantee fee income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 577.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 577.67 Td (Investment losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 562.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 562.67 Td (Gains on loans) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 562.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 562.67 Td (Derivative losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 547.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 547.67 Td (Investment gains) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 547.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 547.67 Td (Administrative expenses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 532.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 532.67 Td (Derivative gains) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 532.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 532.67 Td (Credit-related expenses) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 483.17 Td (Capital Markets) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 510.17 Td (Reflects results from managing our mortgage-related) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 499.37 Td (investments portfolio \(excluding Multifamily segment) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 488.62 Td (investments, single-family seriously delinquent loans,) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 477.77 Td (and the credit risk of single-family performing and) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 467.02 Td (reperforming loans\), treasury function, single-family) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 456.22 Td (securitization activities, and interest-rate risk) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 516.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 516.67 Td (Net interest income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 516.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 516.67 Td (Investment losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 502.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 502.67 Td (Investment gains) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 502.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 502.67 Td (Derivative losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.50 488.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 488.67 Td (Derivative gains) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.50 488.67 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 488.67 Td (Administrative expenses) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 416.67 Td (All Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 432.87 Td (Consists of material corporate-level activities that are) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 422.07 Td (infrequent in nature and based on decisions outside) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 411.32 Td (the control of the management of our reportable) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 119.50 400.47 Td (segments) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.50 416.67 Td (N/A) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 440.50 416.67 Td (N/A) Tj ET Q BT /F2 11.00 Tf ET BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 360.70 Td (Segment Earnings) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 339.30 Td (We evaluate segment performance and allocate resources based on a Segment Earnings approach:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 318.64 cm /I284 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 318.64 cm /I285 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 320.90 Td (We make significant reclassifications among certain line items in our GAAP financial statements to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 305.50 Td (reflect measures of guarantee fee income on guarantees, net interest income on investments, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 290.10 Td (benefit \(provision\) for credit losses on loans that are in line with how we manage our business.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 269.44 cm /I286 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 269.44 cm /I287 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 271.70 Td (We allocate certain revenues and expenses, including certain returns on assets, funding and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 256.30 Td (hedging costs, and all administrative expenses to our three reportable segments.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 235.64 cm /I288 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 235.64 cm /I289 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 237.90 Td (The sum of Segment Earnings for each segment and the All Other category equals GAAP net ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 222.50 Td (income \(loss\). Likewise, the sum of comprehensive income \(loss\) for each segment and the All Other ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 207.10 Td (category equals GAAP comprehensive income \(loss\).) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 185.70 Td (During 4Q 2018, we changed how we calculate certain components of our Segment Earnings for our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 170.30 Td (Single-family Guarantee and Capital Markets segments. Prior period results have been revised to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 154.90 Td (conform to the current period presentation. For more information on these changes and our segment ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 139.50 Td (reclassifications, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 154.41 139.50 Td (Note 13) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 199.49 139.50 Td (.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (Segment Earnings differs significantly from, and should not be used as a substitute for, net income \(loss\) ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 102.70 Td (as determined in accordance with GAAP. Our definition of Segment Earnings may differ from similar ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 87.30 Td (measures used by other companies. We believe that Segment Earnings provides us with meaningful ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 71.90 Td (metrics to assess the financial performance of each segment and our company as a whole. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 521.47 71.90 Td (Note ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 56.50 Td (1) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 56.85 56.50 Td (3) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 64.20 56.50 Td ( for additional details on Segment Earnings, including additional financial information for our ) Tj ET Q endstream endobj 67 0 obj <> endobj 68 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 374.45 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 472.62 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 475.12 764.07 Td (Segment Earnings) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (29) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (segments.) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 713.55 Td (Segment Comprehensive Income) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 702.35 m 562.5 702.35 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 678.95 Td (The graph below shows our comprehensive income by segment.) Tj ET Q /GS0 gs q 400.00 0 0 356.00 106.00 308.95 cm /I290 Do Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 291.75 Td ( ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 70.91 291.75 Td ( ) Tj ET Q endstream endobj 69 0 obj <> endobj 70 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (30) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 733.30 Td (Single-Family Guarantee) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 705.70 Td (Business Overview) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 694.5 m 562 694.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.10 Td (Our Single-family Guarantee segment supports our primary business strategies by creating:) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 649.70 Td (A Better Freddie Mac:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 629.04 cm /I291 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 629.04 cm /I292 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 631.30 Td (Providing market leadership by delivering quality offerings, programs, and services to an increasingly ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 615.90 Td (diversified customer base and an evolving mortgage market; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 595.24 cm /I293 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 595.24 cm /I294 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 597.50 Td (Improving the customer experience through continued enhancement of our products, programs, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 582.10 Td (processes, and technology; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 561.44 cm /I295 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 561.44 cm /I296 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 563.70 Td (Establishing effective risk management activities, including credit risk transfer transactions, that are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 548.30 Td (appropriate for the level of risk;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 527.64 cm /I297 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 527.64 cm /I298 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 529.90 Td (Developing innovative technology platforms to provide sellers and servicers and Freddie Mac with ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 514.50 Td (better methods of assessing and managing single-family mortgage credit risk; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 493.84 cm /I299 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 493.84 cm /I300 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 496.10 Td (Providing quality risk-adjusted returns; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 472.44 cm /I301 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 472.44 cm /I302 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 474.70 Td (Offering third-party investors new and innovative ways to share in the credit risk of the single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 459.30 Td (credit guarantee portfolio.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 440.90 Td (A Better Housing Finance System:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 420.24 cm /I303 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 420.24 cm /I304 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 422.50 Td (Developing and implementing initiatives to cost-effectively reduce taxpayer exposure to our risks;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 401.84 cm /I305 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 401.84 cm /I306 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 404.10 Td (Expanding access to affordable housing in a responsible manner to support our Charter Mission as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 388.70 Td (well as to meet specific mandated goals;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 368.04 cm /I307 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 368.04 cm /I308 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 370.30 Td (Working with FHFA, Fannie Mae, and CSS on the development of a new common securitization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 354.90 Td (platform and implementing the Single Security initiative for Freddie Mac and Fannie Mae. The Single ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 339.50 Td (Security initiative is intended to increase the liquidity of the TBA market and to reduce the disparities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 324.10 Td (in trading value between our PCs and Fannie Mae's single-class mortgage-related securities; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 303.44 cm /I309 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 303.44 cm /I310 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 305.70 Td (Leveraging technology and big data to improve the mortgage process for all stakeholders, including ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 290.30 Td (reducing costs for lenders and borrowers and making the loan process more efficient and effective.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 268.90 Td (The U.S. residential mortgage market consists of a primary mortgage market that links homebuyers and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 253.50 Td (lenders, and a secondary mortgage market that links lenders and investors. The size of the U.S. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (residential mortgage market is affected by many factors, including changes in interest rates, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 222.70 Td (unemployment rates, homeownership rates, housing prices, the supply of housing, lender preferences ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 207.30 Td (regarding credit risk, and borrower preferences regarding mortgage debt.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 185.90 Td (In accordance with our Charter, we participate in the secondary mortgage market. The Single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 170.50 Td (Guarantee segment provides liquidity and support to the single-family market through a variety of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 155.10 Td (activities that include the purchase, securitization, and guarantee of single-family loans originated by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 139.70 Td (sellers and servicers. The mix of loan products available for us to purchase is affected by several ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 124.30 Td (factors, including the volume of loans meeting the requirements of our Charter, our own preference for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 108.90 Td (credit risk reflected in our purchase standards, and the loan purchase and securitization activity of other ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 93.50 Td (financial institutions.) Tj ET Q endstream endobj 71 0 obj <> endobj 72 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (31) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (Our primary business model is to acquire loans that lenders originate and then pool those loans into ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (mortgage-related securities that can be sold in the capital markets. The returns we generate from these ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 710.35 Td (activities are primarily derived from the ongoing guarantee fee we receive in exchange for providing our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.95 Td (guarantee of the principal and interest payments of the issued mortgage-related securities.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 673.55 Td (In order to issue mortgage-related securities, we establish trusts pursuant to our Master Trust ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 658.15 Td (Agreements and serve as the trustee of those trusts. The lender or servicer administers the collection of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 642.75 Td (borrowers' payments on their loans and remits the collected funds to us. We administer the distribution ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 627.35 Td (of payments to the investors in the mortgage-related securities, net of any applicable guarantee fees. To ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 611.95 Td (reduce our exposure under our guarantee, we transfer credit risk on a portion of our single-family credit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 596.55 Td (guarantee portfolio to the private market when it is cost-effective to do so. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 575.15 Td (The diagram below illustrates our primary business model.) Tj ET Q /GS0 gs q 513.00 0 0 164.40 49.50 396.78 cm /I311 Do Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 372.35 Td (When a borrower prepays a loan that we have securitized, the outstanding balance of the security ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 356.95 Td (owned by investors is reduced by the amount of the prepayment. If the borrower becomes delinquent, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 341.55 Td (we continue to make the applicable payments to the investors in the mortgage-related securities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 326.15 Td (pursuant to our guarantee until we purchase the loan out of the trust. We have the option to purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 310.75 Td (specified loans, including certain delinquent loans, from the trusts at a purchase price equal to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 295.35 Td (current UPB of the loan, less any outstanding advances of principal that have been previously ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 279.95 Td (distributed. If borrowers become delinquent, we work with the borrowers through our servicers to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 264.55 Td (mitigate our losses through our loan workout programs, which are discussed in more detail in ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 509.24 264.55 Td (Risk ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 249.15 Td (Management) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 123.44 249.15 Td (. If we are unable to achieve a successful loan workout, we will pursue foreclosure of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 233.75 Td (underlying property, which will result in a third-party sale or an acquisition of the property as REO. The ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 218.35 Td (purchase and sale of delinquent loans are done in conjunction with the Capital Markets segment.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 195.55 Td (Guarantee Fees) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 184.35000000000002 m 562 184.35000000000002 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 160.95 Td (We enter into loan purchase agreements with many of our single-family customers that outline the terms ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 145.55 Td (under which we agree to purchase loans from them over a period of time. For most of the loans we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 130.15 Td (purchase, the guarantee fees are not specified contractually. Instead, we bid for some or all of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 114.75 Td (lender's loan volume on a monthly basis at a guarantee fee that we specify. As a result, our loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 99.35 Td (purchase volumes from individual customers can fluctuate significantly.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 77.95 Td (We seek to issue guarantees with fee terms that are commensurate with the aggregate risks assumed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 62.55 Td (and that will, over the long-term, provide guarantee fee income that exceeds the credit-related and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 47.15 Td (administrative expenses on the underlying loans and also provide a return on the capital that would be ) Tj ET Q endstream endobj 73 0 obj <> endobj 74 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (32) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (needed to support the related credit risk. The guarantee fees charged on new acquisitions generally ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (consist of:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 702.09 cm /I312 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 704.35 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 704.35 Td (A contractual monthly fee paid as a percentage of the UPB of the underlying loan;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 683.69 cm /I313 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 685.95 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 685.95 Td (Upfront fees, which primarily include delivery fees that are calculated based on credit risk factors ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 670.55 Td (such as the loan product type, loan purpose, LTV ratio, and credit score. These delivery fees are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 655.15 Td (charged to compensate us for higher levels of risk in some loan products;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 634.49 cm /I314 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 636.75 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 636.75 Td (Upfront payments made or received to buy up or buy down, respectively, the monthly contractual ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 621.35 Td (guarantee fee \("buy-up fees" or "buy-down fees"\). These fees are paid in conjunction with the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 605.95 Td (formation of a PC to provide for a uniform coupon rate for the mortgage pool underlying the PC. The ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 590.55 Td (payments made to buy-up the monthly contractual guarantee fee are not considered compensation ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 575.15 Td (for the credit risk assumed for purposes of our financial statements. Consequently, these amounts ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 559.75 Td (are allocated to the Capital Markets segment;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 539.09 cm /I315 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 539.09 cm /I316 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 541.35 Td (Market adjusted pricing costs based on the market pricing of our PCs relative to the market pricing ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 525.95 Td (of comparable Fannie Mae securities; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 505.29 cm /I317 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 505.29 cm /I318 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 507.55 Td (The legislated 10 basis point increase in guarantee fees under the Temporary Payroll Tax Cut ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 492.15 Td (Continuation Act of 2011.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 470.75 Td (We operate in a competitive market by varying our pricing for different customers, loan products, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 455.35 Td (underwriting characteristics. We seek to maintain a broad-ranging mix of loan quality for the loans we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 439.95 Td (purchase. However, sellers may elect to retain loans with better credit characteristics. A seller's decision ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 424.55 Td (to retain these loans could result in our purchases having a more adverse credit profile.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 403.15 Td (We must obtain FHFA's approval to implement across-the-board changes to our guarantee fees. In ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 387.75 Td (addition, from time to time, FHFA issues directives or guidance to us affecting the levels of guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 372.35 Td (fees that we may charge for various types of loans. In July 2016, FHFA issued a directive that addressed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 356.95 Td (the safety and soundness risk that could arise if our guarantee fees were not sufficient to compensate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 341.55 Td (us adequately for the credit risk we are taking. This directive puts some constraints on certain aspects ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 326.15 Td (of our guarantee fees, such as our ability to reduce the contractual guarantee fee. In December 2017 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 310.75 Td (and February 2018, FHFA issued additional guidance that requires the GSEs to meet certain profitability ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 295.35 Td (levels on new fundings beginning in 2018.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 272.55 Td (Common Securitization Platform and the UMBS) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 261.35 m 562 261.35 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 237.95 Td (In accordance with FHFA's 2014 Strategic Plan and the Conservatorship Scorecards, we continue to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 222.55 Td (work with FHFA, Fannie Mae, and CSS on the development of a new Common Securitization Platform ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 207.15 Td (\(CSP\) and the implementation of the Single Security initiative for Freddie Mac and Fannie Mae. The ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 191.75 Td (Single Security initiative provides for Freddie Mac and Fannie Mae to issue a single \(common\) ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 176.35 Td (mortgage-related security, to be called the Uniform Mortgage-Backed Security, or UMBS.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 154.95 Td (In December 2016, we and FHFA announced the implementation of Release 1 of the CSP. Under ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 139.55 Td (Release 1, we began using the CSP for data acceptance, issuance support, and bond administration ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 124.15 Td (activities related to Freddie Mac single-class fixed-rate mortgage-related securities.? Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 102.75 Td (FHFA has announced that Release 2 of the CSP will be implemented in June 2019. Release 2 will allow ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 87.35 Td (Freddie Mac and Fannie Mae to each issue the UMBS. Release 2 will also add to the functionality of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 71.95 Td (platform by, among other things, enabling commingling of Freddie Mac and Fannie Mae UMBS and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 56.55 Td (other TBA-eligible MBS in resecuritization transactions. Freddie Mac intends to offer an optional ) Tj ET Q endstream endobj 75 0 obj <> endobj 76 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (33) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (exchange program to enable security holders to exchange certain existing 45-day payment delay fixed-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (rate Gold PCs and Giant PCs for new 55-day payment delay Freddie Mac securities. As part of this ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 710.35 Td (program, Freddie Mac will pay exchanging security holders for the 10 additional days of payment delay, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.95 Td (based on float compensation rates calculated by Freddie Mac. We do not expect to earn enough of a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 679.55 Td (return from this additional float that it will be sufficient to offset our payments to the security holders.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 658.15 Td (In November 2018, FHFA reported that Freddie Mac and CSS completed system-to-system, bilateral ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 642.75 Td (end-to-end, and data conversion testing for Release 2. Tri-party end-to-end testing, with both Fannie ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 627.35 Td (Mae and Freddie Mac conducting daily processing and testing in a single CSP environment, is also ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 611.95 Td (complete. In addition, FHFA reported that in September 2018, Freddie Mac and CSS migrated Freddie ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 596.55 Td (Mac's production processing for single-class MBS from Release 1 to the relevant Release 2 code, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 581.15 Td (confirming that the relevant Release 2 modules are production-ready. Production processing on the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 565.75 Td (Release 2 code continues to perform as expected.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 544.35 Td (Freddie Mac, Fannie Mae, and CSS completed production data conversion and began parallel ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 528.95 Td (processing for Release 2 on schedule in November 2018. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 507.55 Td (With the implementation of Release 2 in June 2019, Freddie Mac will use the CSP for issuance and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 492.15 Td (monthly processing of single-class UMBS backed by fixed-rate loans, single-class resecuritizations of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 476.75 Td (UMBS, multiclass securities such as REMICs, and the related disclosures and tax reporting.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 455.35 Td (The successful implementation of Release 2 and a smooth transition of the market to trading the UMBS ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 439.95 Td (require planning, investment, and preparation on the part of a wide variety of market participants.?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 424.55 Td (Freddie Mac has engaged in extensive industry outreach to facilitate the transition, including ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 409.15 Td (participating in industry forums and conferences, webinars, conference calls, meetings with individual ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 393.75 Td (firms, and consultations with advisory and industry-sponsored working groups. As the implementation ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 378.35 Td (date for Release 2 approaches, Freddie Mac has accelerated and intensified our engagement with ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 362.95 Td (market participants.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 337.35 Td (Products and Activities) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 323.95 m 562 323.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 302.75 Td (Securitization and Guarantee Products) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 281.35 Td (We offer various types of guarantee and securitization products, primarily single-class securitizations ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 265.95 Td (and resecuritizations. In these securitization products, Freddie Mac functions in its capacity as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 250.55 Td (depositor, guarantor, administrator, and trustee. We retain the credit risk and transfer the interest-rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 235.15 Td (and prepayment risks to the investors. While the Single-family Guarantee segment is responsible for the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 219.75 Td (guarantee of our securities, the Capital Markets segment manages the securitization and resecuritization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 204.35 Td (processes.) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 182.95 Td (Single-Class Securitization Products) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 241.26 182.95 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 161.55 Td (We offer a variety of single-class securitization products to our customers. Our single-class ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 146.15 Td (securitization products are pass-through securities that represent undivided beneficial interests in trusts ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 130.75 Td (that hold pools of loans. For our fixed-rate PCs, we guarantee the timely payment of principal and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 115.35 Td (interest. For our ARM PCs, we guarantee the timely payment of the weighted average coupon interest ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 99.95 Td (rate for the underlying loans. We also guarantee the full and final payment of principal, but not the timely ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 84.55 Td (payment of principal, on ARM PCs. In exchange for our guarantee, we receive fees as described in the ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 69.15 Td (Guarantee Fees) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 139.64 69.15 Td ( section above.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 47.75 Td (We issue the following types of single-class securitization products:) Tj ET Q endstream endobj 77 0 obj <> endobj 78 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (34) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 738.29 cm /I319 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 738.29 cm /I320 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 740.55 Td (Guarantor Swap PCs) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 177.09 740.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 180.15 740.55 Td (-) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 184.43 740.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 187.49 740.55 Td (We offer transactions in which our customers, primarily large mortgage ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 725.15 Td (banking companies and commercial banks, provide us with loans in exchange for PCs, as shown in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 709.75 Td (the diagram below:) Tj ET Q /GS0 gs q 513.00 0 0 288.00 49.50 413.75 cm /I321 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 387.09 cm /I322 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 387.09 cm /I323 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 389.35 Td (Cash PCs) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 118.72 389.35 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.77 389.35 Td (-) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 126.05 389.35 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 129.11 389.35 Td (We offer cash products to our customers, primarily community and regional banks. In ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 373.95 Td (these transactions, we purchase performing loans for cash and securitize them for retention in our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 358.55 Td (mortgage-related investments portfolio or for sale to third parties. For the period of time between ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 343.15 Td (loan purchase and securitization, we refer to the loan as being in our securitization pipeline. The ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 327.75 Td (purchase of loans and sale of PCs are managed by the Capital Markets segment. The diagram ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 312.35 Td (below illustrates a cash PC transaction. We securitize certain reperforming loans into PCs using a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 296.95 Td (similar process. We may subsequently resecuritize a portion of the PCs backed by reperforming ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 281.55 Td (loans, with some of the resulting interests being sold to third parties. For additional information, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 67.50 266.15 Td (Our Business Segments - Capital Markets - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 317.81 266.15 Td (Business Overview) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 425.65 266.15 Td (. ) Tj ET Q endstream endobj 79 0 obj <> endobj 80 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (35) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 513.00 0 0 288.95 49.50 460.05 cm /I324 Do Q BT /F2 11.00 Tf ET BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 435.65 Td (Resecuritization Products ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 414.25 Td (We offer resecuritization products to our customers. Our resecuritization products represent beneficial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 398.85 Td (interests in pools of PCs and certain other types of mortgage assets. We create these securities by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 383.45 Td (using PCs or our previously issued resecuritization products as the underlying collateral. We leverage ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 368.05 Td (the issuance of these securities to expand the range of investors in our mortgage-related securities to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 352.65 Td (include those seeking specific security attributes. Similar to our PCs, we guarantee the payment of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 337.25 Td (principal and interest to the investors in our resecuritization products. We do not charge a guarantee fee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 321.85 Td (for these securities if the underlying collateral is already guaranteed by us since no additional credit risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 306.45 Td (is introduced, although we typically receive a transaction fee as compensation for creating the security ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 291.05 Td (and future administrative responsibilities. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 269.65 Td (All of the cash flows from the collateral underlying our resecuritization products are generally passed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 254.25 Td (through to investors in these securities. We do not issue resecuritization products that have ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 238.85 Td (concentrations of credit risk beyond those embedded in the underlying assets. In many of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 223.45 Td (resecuritization transactions, securities dealers or investors deliver mortgage assets in exchange for the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 208.05 Td (resecuritization product. In certain cases, we may also transfer our own mortgage assets in exchange ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 192.65 Td (for the resecuritization product. The resecuritization activities are managed by the Capital Markets ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 177.25 Td (segment. The following diagram provides a general example of how we create resecuritization products:) Tj ET Q endstream endobj 81 0 obj <> endobj 82 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (36) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 513.00 0 0 288.95 49.50 460.05 cm /I325 Do Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 435.65 Td (We issue the following types of resecuritization products:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 411.99 cm /I326 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 411.99 cm /I327 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 414.25 Td (Giant PCs) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 119.85 414.25 Td ( ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 122.91 414.25 Td (-) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 127.19 414.25 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 130.24 414.25 Td (Resecuritizations of previously issued PCs or Giant PCs. Giant PCs are single-class ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 398.85 Td (securities that involve the straight pass through of all cash flows of the underlying collateral to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 383.45 Td (holders of the beneficial interests.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 362.79 cm /I328 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 362.79 cm /I329 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 365.05 Td (Stripped Giant PCs) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 167.47 365.05 Td ( ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 170.53 365.05 Td (-) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 174.81 365.05 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 177.86 365.05 Td (Multiclass securities that are formed by resecuritizing previously issued PCs ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 349.65 Td (or Giant PCs and issuing stripped securities, including principal-only and interest-only securities or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 334.25 Td (floating rate and inverse interest-only securities, backed by the cash flows from the underlying ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 318.85 Td (collateral.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 298.19 cm /I330 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 298.19 cm /I331 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 300.45 Td (REMICs) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 109.85 300.45 Td ( ) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 112.91 300.45 Td (-) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 117.19 300.45 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 120.25 300.45 Td (Resecuritizations of previously issued PCs, Giant PCs, Stripped Giant PCs, or REMICs. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 285.05 Td (REMICs are multiclass securities that divide all cash flows of the underlying collateral into two or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 269.65 Td (more classes with varying maturities, payment priorities, and coupons.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 248.99 cm /I332 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 248.99 cm /I333 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 251.25 Td (Other securitization products) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 220.99 251.25 Td ( - Guaranteed mortgage-related securities collateralized by non-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 235.85 Td (Freddie Mac mortgage-related securities. However, we have not entered into these types of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 220.45 Td (transactions as part of our Single-family Guarantee business in several years.) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 199.05 Td (Sales of Mortgage Loans) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 177.65 Td (We continually manage the balance of our less liquid assets. We offer to sell select mortgage loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 162.25 Td (through a variety of methods that include whole loan sales or certain securitization transactions. In these ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 146.85 Td (transactions, we reduce or eliminate our credit risk, in addition to our interest-rate and prepayment risk, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 131.45 Td (associated with the underlying mortgage loans. The sales of these mortgage loans are managed by the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 116.05 Td (Capital Markets segment.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 94.65 Td (Our mortgage loans are sold through the following transactions:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 70.99 cm /I334 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 70.99 cm /I335 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 73.25 Td (Whole loan sales) Tj ET Q BT /F16 11.00 Tf ET q 0 0 0 rg BT 156.07 73.25 Td ( ) Tj ET Q BT /F17 11.00 Tf ET q 0 0 0 rg BT 158.82 73.25 Td (- ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 165.24 73.25 Td (Sales of seriously delinquent loans for cash.) Tj ET Q endstream endobj 83 0 obj <> endobj 84 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (37) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 738.29 cm /I336 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 738.29 cm /I337 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 740.55 Td (Senior subordinate securitization structures \(non-consolidated\)) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 399.21 740.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 402.26 740.55 Td (-) Tj ET Q BT /F17 11.00 Tf ET q 0 0 0 rg BT 406.54 740.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 409.29 740.55 Td (Transactions where we issue ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 725.15 Td (guaranteed senior securities and unguaranteed subordinated securities. The collateral for these ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 709.75 Td (structures primarily consists of reperforming loans. The unguaranteed subordinated securities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 694.35 Td (absorb first losses on the related loans. Unlike other senior subordinate securitization structures, in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 678.95 Td (these transactions the loans are not serviced in accordance with our Guide and we do not control ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 663.55 Td (the servicing. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 158.02 663.55 Td (Risk Management - Single-Family Mortgage Credit Risk - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 485.79 663.55 Td (Transferring ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 67.50 648.15 Td (Credit Risk of the Single-Family Credit Guarantee Portfolio to Investors in New and ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 67.50 632.75 Td (Innovative Ways) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 159.48 632.75 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 163.16 632.75 Td (for a description of various forms of credit enhancements we use to transfer a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 617.35 Td (portion of the credit risk on our single-family loans, including senior subordinate securitization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 601.95 Td (structures.) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 580.55 Td (Long-Term Standby Commitments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 559.15 Td (We also offer a guarantee on mortgage assets held by third parties, in exchange for guarantee fees, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 543.75 Td (without securitizing those assets. These long-term standby commitments obligate us to purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 528.35 Td (seriously delinquent loans that are covered by those commitments. From time to time, we have ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 512.95 Td (consented to the termination of our long-term standby commitments and simultaneously entered into ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 497.55 Td (guarantor swap transactions with the same counterparty, issuing PCs backed by many of the same ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 482.15 Td (loans.) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 49.25 465.65 512.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 421.65 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 421.65 503.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 417.65 9.00 -36.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 417.65 503.00 -36.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 381.65 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 381.65 503.00 -4.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 49.25 421.65 m 58.25 421.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58.25 421.65 m 561.25 421.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 49.25 377.65 m 58.25 377.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58.25 377.65 m 561.25 377.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49.25 353.65 m 58.25 353.65 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 58.25 353.65 m 561.25 353.65 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 51.75 453.51 Td (The primary impacts of the aforementioned products and transactions to Segment Earnings are:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.75 432.01 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 432.01 Td (Guarantee fee income earned on our guarantee of principal and interest payments on these mortgage-related securities;) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 50.75 408.01 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 407.51 Td (Benefit \(provision\) for credit losses, which is affected by changes in estimated probabilities of default and estimated loss severities,) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 397.51 Td (the actual level of loan defaults, the effect of loss mitigation efforts, and payment performance of our individually impaired mortgage) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 387.51 Td (portfolio; and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 50.75 364.01 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 363.51 Td (Gains and losses recognized on the reclassification of loans held-for-investment to held-for-sale and subsequent sale of these loans.) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 332.75 Td (Credit Risk Transfer \(CRT\) Transactions) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 311.35 Td (To reduce our credit risk exposure, we engage in various credit enhancement arrangements, which ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 295.95 Td (include CRT transactions and other credit enhancements. We define CRT transactions as those ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 280.55 Td (arrangements where we actively transfer the credit risk exposure on mortgages that we own or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 265.15 Td (guarantee. We define other credit enhancements as those arrangements, such as traditional primary ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 249.75 Td (mortgage insurance, where we do not actively take part in the transfer of the credit risk exposure. Our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 234.35 Td (CRT transactions are designed to reduce the amount of conservatorship capital needed under the CCF, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 218.95 Td (to transfer portions of credit losses on groups of previously acquired loans to third-party investors, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 203.55 Td (to reduce the risk of future losses to us and taxpayers if borrowers go into default. The payments we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 188.15 Td (make in exchange for this credit protection effectively reduce our guarantee fee income from the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 172.75 Td (associated mortgages. The following strategic considerations were incorporated into the design of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 157.35 Td (CRT transactions:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 133.69 cm /I338 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 133.69 cm /I339 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 135.95 Td (Offer repeatable and scalable execution with a broad appeal to diversified investors;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 115.29 cm /I340 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 115.29 cm /I341 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 117.55 Td (Execute at a cost that is economically sensible;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 96.89 cm /I342 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 96.89 cm /I343 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 99.15 Td (Result in no or minimal effect on the TBA market;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 78.49 cm /I344 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 78.49 cm /I345 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 80.75 Td (Minimize changes required of, and effects on, sellers and servicers by having Freddie Mac serve as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 65.35 Td (the credit manager for investors; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 44.69 cm /I346 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 44.69 cm /I347 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 46.95 Td (Avoid or very substantially mitigate the risk that our losses are not reimbursed timely and in full.) Tj ET Q endstream endobj 85 0 obj <> endobj 86 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (38) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (A detailed list of our CRT transactions, along with other credit enhancement arrangements, is included ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (in ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 61.12 725.75 Td (Risk Management - Single-Family Mortgage Credit Risk - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 388.88 725.75 Td (Transferring Credit Risk of ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 710.35 Td (the Single-Family Credit Guarantee Portfolio to Investors in New and Innovative Ways) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 538.44 710.35 Td (.) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 541.50 710.35 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.95 Td (Our primary CRT transactions include: ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 671.29 cm /I348 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 671.29 cm /I349 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 673.55 Td (STACR debt notes ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 165.62 673.55 Td (- Transactions in which we create a reference pool of loans from our single-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 658.15 Td (family loan portfolio and an associated securitization-like structure with notional credit risk positions ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 642.75 Td (\(e.g., first loss, mezzanine, and senior positions\). We issue STACR debt notes linked to certain of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 627.35 Td (notional credit risk positions to third-party investors. In certain of our STACR debt note transactions, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 611.95 Td (we transferred risk in both first loss and mezzanine notional credit risk positions, while in other ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 596.55 Td (transactions we only transferred risk in the mezzanine notional credit risk position.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 575.15 Td ( We make payments of principal and interest on the issued STACR debt notes, but are not required to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 559.75 Td (repay principal to the extent that the notional credit risk position is reduced as a result of specified ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 544.35 Td (credit events. The amount of risk transferred in each transaction affects the interest rate we pay on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 528.95 Td (the notes. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 507.55 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 507.55 Td (Generally, the notional amounts of the credit risk positions will be reduced based on principal ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 492.15 Td (payments that occur on the loans in the reference pool. The notional amounts are also reduced by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 476.75 Td (losses from loans in the reference pool when certain specified credit events occur. Depending on the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 461.35 Td (particular transaction, and as specified in the offering documents, losses are allocated to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 445.95 Td (notional amounts of the credit risk positions based on calculated losses using a predefined formula, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 430.55 Td (or based on the actual losses on the loans in the reference pool. For loans that are covered by CRT ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 415.15 Td (transactions based on calculated losses \(generally STACR debt notes issued prior to 2015\), we write ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 399.75 Td (down the STACR debt notes or receive reimbursement of losses when the loans experience a credit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 384.35 Td (event, which predominantly includes a loan becoming 180 days delinquent. For loans that are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 368.95 Td (covered by CRT transactions based on actual losses, we write down the STACR debt notes or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 353.55 Td (receive reimbursement of losses once an actual loss event \(e.g., short sale, third-party sale or REO ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 338.15 Td (disposition\) occurs.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 316.75 Td (The following diagram illustrates a typical STACR debt note transaction:) Tj ET Q endstream endobj 87 0 obj <> endobj 88 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (39) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 513.00 0 0 367.30 49.50 381.72 cm /I350 Do Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 363.30 Td (While STACR debt notes have been one of our primary CRT transactions in recent years, we expect that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 347.90 Td (going forward we will instead primarily utilize STACR Trust transactions.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 324.24 cm /I351 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 324.24 cm /I352 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 68.71 326.50 Td (STACR Trust) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 134.15 326.50 Td ( - We introduced STACR Trust transactions in 2Q 2018 as an enhancement to STACR ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 311.10 Td (debt note transactions. The key difference between STACR Trust and STACR debt note transactions ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 295.70 Td (is that the notes in STACR Trust transactions are issued by a third-party bankruptcy-remote trust. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 280.30 Td (Under this structure, we pay a credit premium and certain shortfalls to the trust and receive ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 264.90 Td (payments from the trust as a result of defined credit events on the reference pool. The trust issues ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 249.50 Td (the notes and makes periodic payments of principal and interest on the notes to investors, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 234.10 Td (Freddie Mac receives payments from the trust that otherwise would have been made to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 218.70 Td (noteholders to the extent there are certain defined credit events on the mortgages in the related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 203.30 Td (reference pool. The note balances are reduced by the amount of the payments to us.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 181.90 Td (STACR Trust results in an accounting treatment that better aligns the timing of financial reporting and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 166.50 Td (underlying economics. With STACR Trust transactions, the income derived from the credit protection ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 151.10 Td (is recognized in the same period as the allowance for credit losses, thus reducing the volatility of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 135.70 Td (GAAP earnings and equity. With STACR debt notes, the recognition of the allowance for credit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 120.30 Td (losses typically precedes the reporting of associated credit benefits. ) Tj ET Q endstream endobj 89 0 obj <> endobj 90 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (40) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 741.15 Td (The following diagram illustrates a typical STACR Trust transaction:) Tj ET Q /GS0 gs q 490.00 0 0 381.00 67.50 349.15 cm /I353 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 325.49 cm /I354 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 325.49 cm /I355 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 327.75 Td (ACIS insurance policies) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 191.35 327.75 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 194.41 327.75 Td (- Transactions in which we purchase insurance policies, generally ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 312.35 Td (underwritten by a group of insurers and reinsurers, that provide credit protection for certain specified ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 296.95 Td (credit events that occur and are typically allocated to the non-issued notional credit risk positions of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 281.55 Td (a STACR transaction \(i.e., the risk positions that Freddie Mac retains\). We also enter into ACIS ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 266.15 Td (transactions that provide credit protection for certain specified credit events on loans not included in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 250.75 Td (a reference pool created for a STACR transaction, such as 15- and 20-year fixed-rate loans. An ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 235.35 Td (additional offering in the ACIS program is the ACIS Forward Risk Mitigation \(AFRM) Tj ET Q BT /F2 11.00 Tf ET BT /F2 6.60 Tf ET q 0 0 0 rg BT 471.17 239.20 Td (SM) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 481.19 235.35 Td (\) transaction, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 219.95 Td (which provides front-end credit risk transfer as loans come into the portfolio. Under each of these ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 204.55 Td (insurance policies, we pay monthly premiums that are determined based on the outstanding balance ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 189.15 Td (of the reference pool. When specific credit events occur, we generally receive compensation from ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 173.75 Td (the insurance policy up to an aggregate limit based on actual losses. We require our ACIS ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 158.35 Td (counterparties to partially collateralize their exposure to reduce the risk that we will not be ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 142.95 Td (reimbursed for our claims under the policies.) Tj ET Q endstream endobj 91 0 obj <> endobj 92 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (41) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 49.25 748.50 512.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 704.50 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 704.50 503.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 700.50 9.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 700.50 503.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 684.50 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 684.50 503.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 656.50 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 656.50 503.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 652.50 9.00 -26.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 652.50 503.00 -26.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 49.25 626.50 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 626.50 503.00 -4.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 49.25 704.5 m 58.25 704.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58.25 704.5 m 561.25 704.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 49.25 680.5 m 58.25 680.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58.25 680.5 m 561.25 680.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 49.25 656.5 m 58.25 656.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58.25 656.5 m 561.25 656.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49.25 622.5 m 58.25 622.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 58.25 622.5 m 561.25 622.5 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 51.75 736.36 Td (The primary impacts of our credit risk transfer transactions to Segment Earnings are:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.75 714.86 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 714.86 Td (Interest expense on our STACR debt notes, net of reinvestment income;) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 50.75 690.86 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 690.36 Td (Fair value gains and losses recognized on certain of our STACR debt notes, net of the costs of hedging interest rate risk;) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 50.75 666.86 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 666.36 Td (Premium expense for ACIS and STACR Trust contracts; and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 50.75 642.86 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 642.36 Td (Benefits recognized from recoveries under the CRT transactions. Benefits from certain of our STACR transactions are recognized as) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 632.36 Td (debt gains, whereas benefits from other CRT transactions are recognized as other income.) Tj ET Q BT /F2 11.00 Tf ET BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 600.20 Td (Customers) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 589 m 562 589 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 565.60 Td (Our customers in the Single-family Guarantee segment are predominantly financial institutions that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 550.20 Td (originate, sell, and perform the ongoing servicing of loans for new or existing homeowners. These ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 534.80 Td (companies include mortgage banking companies, commercial banks, regional banks, community ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 519.40 Td (banks, credit unions, HFAs, savings institutions, and non-depository financial institutions. Many of these ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 504.00 Td (companies are both sellers and servicers for us. In addition, we maintain relationships with investors ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 488.60 Td (and dealers in our guaranteed mortgage-related securities.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 467.20 Td (We acquire a significant portion of our loans from several lenders that are among the largest originators ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 451.80 Td (in the U.S. In addition, a significant portion of our single-family loans is serviced by several large ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 436.45 Td (servicers. The following charts show the concentration of our 2018 single-family purchase volume by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 421.05 Td (our largest sellers and our loan servicing by our largest servicers as of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 395.14 421.05 Td (December?1, 2018) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 491.95 421.05 Td (. Any seller or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 405.65 Td (servicer with a 10% or greater share is listed separately.) Tj ET Q endstream endobj 93 0 obj <> endobj 94 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (42) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 67.10 741.15 Td (Percentage of Single-Family Purchase Volume ) Tj ET Q /GS0 gs q 236.50 0 0 412.00 49.35 324.15 cm /I356 Do Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 321.75 741.15 Td ( ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 333.98 741.15 Td (Percentage of Single-Family Servicing Volume) Tj ET Q BT /F11 11.00 Tf ET BT /F11 6.60 Tf ET q 0 0 0 rg BT 535.17 745.00 Td (\(1\) ) Tj ET Q /GS0 gs q 236.50 0 0 412.00 321.75 324.15 cm /I357 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 321.75 309.95 Td (\(1\)) Tj ET Q BT /F4 9.00 Tf ET q 0 0 0 rg BT 330.41 309.95 Td ( ) Tj ET Q BT /F11 11.00 Tf ET BT /F11 6.60 Tf ET q 0 0 0 rg BT 332.57 313.80 Td ( ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 334.15 309.95 Td (Percentage of servicing volume is based on the total single-family ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 335.25 299.15 Td (credit guarantee portfolio, excluding loans where we do not ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 335.25 288.35 Td (exercise control over the associated servicing.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 272.95 Td (For additional information about seller and servicer concentration risk and our relationships with our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 257.55 Td (seller and servicer customers, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 219.75 257.55 Td (Risk Management - Counterparty Credit Risk) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 476.38 257.55 Td ( -) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 484.53 257.55 Td ( ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 488.20 257.55 Td (Sellers and ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 242.15 Td (Servicers) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 102.93 242.15 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 106.60 242.15 Td (and ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 128.21 242.15 Td (Note 14) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 173.28 242.15 Td (.) Tj ET Q endstream endobj 95 0 obj <> endobj 96 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (43) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 737.05 Td (Competition) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 723.65 m 562.5 723.65 l s BT /F13 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 700.25 Td (Our principal competitors in the Single-family Guarantee segment are Fannie Mae, FHA/VA \(with Ginnie ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 684.85 Td (Mae securitization\), and other financial institutions that retain or securitize loans, such as commercial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 669.45 Td (and investment banks, dealers, and savings institutions. We compete on the basis of price, products, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 654.05 Td (securities structure, and service. Competition to acquire single-family loans can also be significantly ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 638.65 Td (affected by changes in our credit standards. The conservatorship, including direction provided to us by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 623.25 Td (our Conservator, may affect our ability to compete. The areas in which we and Fannie Mae compete ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 607.85 Td (have been limited by the Single Security initiative as we have been required by FHFA to align certain of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 592.45 Td (our single-family mortgage purchase offerings, servicing, and securitization practices with Fannie Mae to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 577.05 Td (achieve market acceptance of the UMBS. A proposed rule published by FHFA in September 2018 may ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 561.65 Td (limit our and Fannie Mae's ability to compete with each other in areas that affect prepayment speeds of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 546.25 Td (single-family mortgage-related securities. For more information, see) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 381.39 546.25 Td ( ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 384.86 546.25 Td (Risk Factors - Other Risks - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 530.85 Td (Competition from banking and non-banking institutions \(including Fannie Mae and FHA/) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 515.45 Td (VA with Ginnie Mae securitization\) may harm our business. FHFA's actions, as ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 500.05 Td (Conservator of both companies, could affect competition between us and Fannie Mae) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 540.66 500.05 Td (.) Tj ET Q endstream endobj 97 0 obj <> endobj 98 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (44) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Market Conditions) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 699.55 Td (The graphs and related discussion below present certain single-family market indicators, for the most ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 684.15 Td (recent five years, that can significantly affect the business and financial results of our Single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 668.75 Td (Guarantee segment.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 85.50 649.55 Td ( U.S. Single-Family Originations) Tj ET Q BT /F9 11.00 Tf ET q 0 0 0 rg BT 241.12 649.55 Td ( ) Tj ET Q /GS0 gs q 238.50 0 0 255.00 49.50 383.55 cm /I358 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 346.55 Td (Source: Inside Mortgage Finance dated January 25, 2019.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 324.00 649.55 Td ( U.S. Single-Family Home Sales) Tj ET Q BT /F9 11.00 Tf ET q 0 0 0 rg BT 514.75 649.55 Td ( ) Tj ET Q /GS0 gs q 238.50 0 0 279.00 324.00 359.55 cm /I359 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 344.75 Td (Source: National Association of Realtors news release dated January ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 333.95 Td (22, 2019. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 299.49 cm /I360 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 299.49 cm /I361 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 301.75 Td (U.S. single-family loan origination volumes decreased in 2018 compared to 2017, driven by lower ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 286.35 Td (refinance volume as a result of higher average mortgage interest rates. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 265.69 cm /I362 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 265.69 cm /I363 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 267.95 Td (U.S. single-family existing home sales volume decreased in 2018 compared to 2017, primarily driven ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 252.55 Td (by higher mortgage interest rates and low levels of for-sale inventory in many markets across the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 237.15 Td (country. U.S. single-family new home sales volume is reported by the U.S. Census Bureau; 2018 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 221.75 Td (data is not currently available.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 201.09 cm /I364 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 201.09 cm /I365 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 203.35 Td (In 2019, we expect U.S. single-family home purchase volume to remain relatively flat, while a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 187.95 Td (moderate increase in mortgage interest rates is expected to result in a lower refinance volume. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 172.55 Td (Freddie Mac's single-family loan purchase volumes typically follow a similar trend.) Tj ET Q endstream endobj 99 0 obj <> endobj 100 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (45) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 105.10 739.15 Td (Single-Family Mortgage Debt ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 98.80 725.95 Td (Outstanding as of December 31,) Tj ET Q BT /F14 11.00 Tf ET q 0 0 0 rg BT 238.62 725.95 Td ( ) Tj ET Q BT /F9 11.00 Tf ET q 0 0 0 rg BT 241.68 725.95 Td ( ) Tj ET Q BT /F14 11.00 Tf ET q 0 0 0 rg BT 244.32 725.95 Td ( ) Tj ET Q /GS0 gs q 238.50 0 0 271.00 49.50 443.95 cm /I366 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 435.15 Td (Source: Federal Reserve Financial Accounts of the United States of ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 424.35 Td (America dated December 6, 2018. For 2018, the amount is as of ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 413.55 Td (September 30, 2018 \(latest available information\).) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 341.90 739.15 Td (Single-Family Serious Delinquency Rates as of ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 413.40 725.95 Td (December 31, ) Tj ET Q /GS0 gs q 238.50 0 0 266.00 324.00 445.95 cm /I367 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 437.15 Td (Source: National Delinquency Survey from the Mortgage Bankers ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 426.35 Td (Association. For 2018, the rates \(excluding Freddie Mac\) are as of ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 415.55 Td (September 30, 2018 \(latest available information\).) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 378.09 cm /I368 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 378.09 cm /I369 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 380.35 Td (U.S. single-family mortgage debt outstanding increased in 2018 compared to 2017, primarily driven ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 364.95 Td (by house price appreciation. An increase in U.S. single-family mortgage debt outstanding, combined ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 349.55 Td (with our sustained market share, typically results in growth of our single-family credit guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 334.15 Td (portfolio. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 313.49 cm /I370 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 313.49 cm /I371 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 315.75 Td (The U.S. single-family serious delinquency rate decreased in 2018 compared to 2017 due to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 300.35 Td (macroeconomic factors, such as a low unemployment rate and continued home price appreciation. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 284.95 Td (Our single-family serious delinquency rate typically follows a similar trend. Additionally, the 2017 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 269.55 Td (serious delinquency rate was elevated due to the greater impact of the hurricanes in 2017 than ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 254.15 Td (subsequent hurricanes in 2018. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 246.83 254.15 Td (Risk Management - Single-Family Mortgage Credit ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 67.50 238.75 Td (Risk - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 103.98 238.75 Td (Monitoring Loan Performance and Characteristics of the Single-Family Credit ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 67.50 223.35 Td (Guarantee Portfolio and Individual Sellers and Servicers - Single-Family Credit ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 67.50 207.95 Td (Guarantee Portfolio) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 180.28 207.95 Td ( for additional information on our serious delinquency rate. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 187.29 cm /I372 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 187.29 cm /I373 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 189.55 Td (As reported by the U.S. Census Bureau, the U.S. homeownership rate was 64.4% in the third quarter ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 174.15 Td (of 2018 \(latest available information\) compared to a high point of 69.2% in the fourth quarter of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 158.75 Td (2004, and the average of 66.1% from 1990 to the present.) Tj ET Q endstream endobj 101 0 obj <> endobj 102 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (46) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Business Results) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 699.55 Td (The following graphs and related discussion present the business results of our Single-family Guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 684.15 Td (segment.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 661.35 Td (New Business Activity) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 650.15 m 562.5 650.15 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 51.40 628.95 Td (UPB of Single-Family Loan Purchases and Guarantees ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 132.55 615.75 Td (by Loan Purpose) Tj ET Q /GS0 gs q 228.00 0 0 271.00 49.50 333.75 cm /I374 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 350.35 628.95 Td (Number of Families Helped to Own a Home) Tj ET Q /GS0 gs q 238.50 0 0 278.00 324.00 336.95 cm /I375 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 312.09 cm /I376 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 312.09 cm /I377 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 314.35 Td (We maintain a consistent market presence by providing lenders with a constant source of liquidity ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 298.95 Td (for conforming loan products. We have funded approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 371.52 298.95 Td (17.0 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 427.57 298.95 Td ( single-family homes since ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 283.55 Td (January 1, 2009 and purchased approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 298.13 283.55 Td (1.4 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 348.06 283.55 Td ( HARP loans since the initiative began in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 268.15 Td (2009, which includes just over 3,000 during 2018 as the program is winding down and is being ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 252.75 Td (replaced by the Enhanced Relief Refinance) Tj ET Q BT /F2 11.00 Tf ET BT /F2 6.60 Tf ET q 0 0 0 rg BT 278.78 256.60 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 280.62 252.75 Td (program.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 232.09 cm /I378 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 232.09 cm /I379 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 234.35 Td (Our loan purchase and guarantee activity decreased in 2018 compared to 2017 primarily due to a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 218.95 Td (decline in refinance activity as a result of higher average mortgage interest rates, partially offset by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 203.55 Td (higher home purchase volume. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 182.89 cm /I380 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 182.89 cm /I381 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 185.15 Td (We continued working to improve access to affordable housing, including through our Home ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 169.75 Td (Possible) Tj ET Q BT /F2 11.00 Tf ET BT /F2 6.60 Tf ET q 0 0 0 rg BT 108.79 173.60 Td (? Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 114.07 169.75 Td ( loan initiatives. Our Home Possible) Tj ET Q BT /F2 11.00 Tf ET BT /F2 6.60 Tf ET q 0 0 0 rg BT 287.81 173.60 Td (? Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 293.09 169.75 Td ( loan initiatives offer down payment options as low as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 154.35 Td (3% and are designed to help qualified borrowers with limited savings buy a home. We purchased ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 138.95 Td (over 149,000 loans under these initiatives in 2018. We also continue to implement programs that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 123.55 Td (support responsibly broadening access to affordable housing by:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 102.89 cm /I382 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 102.89 cm /I383 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 105.15 Td (Improving the effectiveness of pre-purchase and early delinquency counseling for borrowers; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 84.49 cm /I384 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 84.49 cm /I385 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 86.75 Td (Expanding our ability to support borrowers who do not have a credit score;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 66.09 cm /I386 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 66.09 cm /I387 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 68.35 Td (Implementing the Duty to Serve Underserved Markets plan; and ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 47.69 cm /I388 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 47.69 cm /I389 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 49.95 Td (Increasing support for first-time home buyers and mortgage industry professionals. ) Tj ET Q endstream endobj 103 0 obj <> endobj 104 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (47) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 739.15 Td (While we are responsibly expanding our programs and outreach capabilities to better serve low- and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.75 Td (moderate-income borrowers and underserved markets, these loans result in increased credit risk. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 708.35 Td (Expanding access to affordable housing will continue to be a top priority in 2019. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 489.66 708.35 Td (Regulation ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 67.50 692.95 Td (and Supervision ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 162.89 692.95 Td (-) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 167.37 692.95 Td ( ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 171.04 692.95 Td (Federal Housing Finance Agency - Duty to Serve Underserved ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 67.50 677.55 Td (Markets Plan) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 142.75 677.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 145.81 677.55 Td (for more information.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 654.75 Td (Single-Family Credit Guarantee Portfolio) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 639.95 m 562.5 639.95 l s BT /F6 14.00 Tf ET BT /F11 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 68.85 618.75 Td (Single-Family Credit Guarantee Portfolio as of ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 138.70 605.55 Td (December 31,) Tj ET Q /GS0 gs q 238.50 0 0 315.00 49.50 285.55 cm /I390 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 355.65 615.75 Td (Single-Family Loans as of December 31,) Tj ET Q /GS0 gs q 238.50 0 0 323.00 324.00 287.75 cm /I391 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 269.89 cm /I392 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 269.89 cm /I393 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 272.15 Td (The single-family credit guarantee portfolio increased during 2018 by approximately 4%, driven by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 256.75 Td (an increase in U.S. single-family mortgage debt outstanding as a result of continued home price ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 241.35 Td (appreciation. New business acquisitions had a higher average loan size compared to older vintages ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 225.95 Td (that continued to run off.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 205.29 cm /I394 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 205.29 cm /I395 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 207.55 Td (The core single-family loan portfolio grew to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 286.00 207.55 Td (82%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 309.24 207.55 Td ( of the single-family credit guarantee portfolio at ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 192.15 Td (December?1, 2018) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 164.31 192.15 Td ( compared to 78% at December 31, 2017, as new loan purchases exceeded ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 176.75 Td (liquidations.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 156.09 cm /I396 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 156.09 cm /I397 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 158.35 Td (The legacy and relief refinance single-family loan portfolio declined to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 410.30 158.35 Td (18%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 433.53 158.35 Td ( of the single-family credit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 142.95 Td (guarantee portfolio at ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 175.74 142.95 Td (December?1, 2018) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 272.55 142.95 Td ( compared to 22% at December 31, 2017, driven primarily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 127.55 Td (by loan liquidations. ) Tj ET Q endstream endobj 105 0 obj <> endobj 106 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (48) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 737.05 Td (Guarantee Fees) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 719.85 m 562.5 719.85 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 696.45 Td (We receive fees for guaranteeing the payment of principal and interest to investors in our mortgage-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 681.05 Td (related securities. These fees consist primarily of a combination of base contractual guarantee fees paid ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 665.65 Td (on a monthly basis and initial upfront payments. The average portfolio Segment Earnings guarantee fee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 650.25 Td (rate recognizes upfront fee income over the contractual life of the related loans \(usually 30 years\). If the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 634.85 Td (related loans prepay, the remaining upfront fee income is recognized immediately. In contrast, the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 619.45 Td (average guarantee fee rate charged on new acquisitions recognizes upfront fee income over the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 604.05 Td (estimated life of the related loans using our expectations of prepayments and other liquidations. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 588.65 Td (Single-Family Guarantee) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 189.23 588.65 Td ( - Business Overview - Guarantee Fees) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 410.85 588.65 Td ( for more information on our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 573.25 Td (guarantee fees.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 49.90 554.05 Td ( Average Portfolio Segment Earnings Guarantee Fee ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 95.20 540.85 Td (Rate) Tj ET Q BT /F11 11.00 Tf ET BT /F11 6.60 Tf ET q 0 0 0 rg BT 114.85 544.70 Td (\(1\)\(2\)) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 129.00 540.85 Td ( for the Year Ended December 31,) Tj ET Q /GS0 gs q 238.50 0 0 225.00 65.25 310.85 cm /I398 Do Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 338.20 554.05 Td ( ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 344.32 554.05 Td (Average Guarantee Fee Rate) Tj ET Q BT /F11 11.00 Tf ET BT /F11 6.60 Tf ET q 0 0 0 rg BT 467.01 557.90 Td (\(1\)) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 474.08 554.05 Td ( Charged on New ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 346.30 540.85 Td (Acquisitions for the Year Ended December 31,) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 288.00 315.85 Td ( ) Tj ET Q /GS0 gs q 238.00 0 0 216.00 321.64 310.85 cm /I399 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 302.05 Td (\(1\) Excludes the legislated 10 basis point increase in guarantee fees.) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 288.25 Td (\(2\) Reflects an average rate for our total single-family credit guarantee portfolio and is not limited to purchases in the applicable period.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 264.59 cm /I400 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 264.59 cm /I401 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 266.85 Td (The average portfolio Segment Earnings guarantee fee rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 359.46 266.85 Td (declined slightly in 2018 compared to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 251.45 Td (2017 due to a decrease in the recognition of upfront fees driven by a lower prepayment rate. This ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 236.05 Td (decrease was partially offset by an increase in contractual guarantee fees as older vintages were ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 220.65 Td (replaced by acquisitions of new loans with higher contractual guarantee fees.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 199.99 cm /I402 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 199.99 cm /I403 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 202.25 Td (The average guarantee fee rate charged on new acquisitions) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 363.27 202.25 Td ( remained consistent in 2018 compared ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 186.85 Td (to 2017.) Tj ET Q endstream endobj 107 0 obj <> endobj 108 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (49) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 737.05 Td (CRT Activities) Tj ET Q BT /F18 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 132.98 737.05 Td ( ) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 725.85 m 562.5 725.85 l s BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 702.45 Td (The table below provides the issuance amounts during 2018 and the cumulative issuance amounts as of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 687.05 Td (December 31, 2018 on the protected UPB and maximum coverage by loss position associated with CRT ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.65 Td (transactions for loans in our single-family credit guarantee portfolio.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 650.25 Td (Table 12 - Single-Family Credit Guarantee Portfolio CRT Issuance) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 163.00 633.75 200.00 -15.00 re f /GS0 gs 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 367.00 633.75 195.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 163.00 618.75 51.00 -25.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 214.00 618.75 149.00 -25.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 367.00 618.75 48.00 -25.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 415.00 618.75 147.00 -25.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 49.00 593.75 110.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 163.00 593.75 51.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 214.00 593.75 47.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 261.00 593.75 51.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 312.00 593.75 51.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 367.00 593.75 48.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 415.00 593.75 49.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 464.00 593.75 49.00 -26.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 513.00 593.75 49.00 -26.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 214 618.75 m 214 593.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 415 618.75 m 415 593.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 214 593.75 m 214 567.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 261 593.75 m 261 567.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 312 593.75 m 312 567.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 415 593.75 m 415 567.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 464 593.75 m 464 567.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 513 593.75 m 513 567.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 468.75 m 159 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 468.75 m 159 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 455.75 m 159 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 453.75 m 159 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 163 468.75 m 214 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 163 455.75 m 214 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 163 453.75 m 214 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 214 468.75 m 261 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 214 455.75 m 261 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 214 453.75 m 261 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 261 468.75 m 312 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 261 455.75 m 312 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 261 453.75 m 312 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 312 468.75 m 363 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 312 455.75 m 363 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 312 453.75 m 363 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 468.75 m 415 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 455.75 m 415 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 367 453.75 m 415 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 415 468.75 m 464 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 415 455.75 m 464 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 415 453.75 m 464 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 464 468.75 m 513 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 464 455.75 m 513 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 464 453.75 m 513 453.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 513 468.75 m 562 468.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 513 455.75 m 562 455.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 513 453.75 m 562 453.75 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 168.30 624.11 Td (Issuance for the Year Ended December 31, 2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 372.75 624.11 Td (Cumulative Issuance as of December 31, 2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 168.90 609.11 Td (Protected ) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 176.70 599.11 Td (UPB) Tj ET Q BT /F9 10.00 Tf ET BT /F9 6.00 Tf ET q 1 1 1 rg BT 192.83 602.61 Td (\(1\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 245.40 599.11 Td (Maximum Coverage) Tj ET Q BT /F9 10.00 Tf ET BT /F9 6.00 Tf ET q 1 1 1 rg BT 324.10 602.61 Td (\(2\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 371.40 609.11 Td (Protected ) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 379.20 599.11 Td (UPB) Tj ET Q BT /F9 10.00 Tf ET BT /F9 6.00 Tf ET q 1 1 1 rg BT 395.33 602.61 Td (\(1\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 445.40 599.11 Td (Maximum Coverage) Tj ET Q BT /F9 10.00 Tf ET BT /F9 6.00 Tf ET q 1 1 1 rg BT 524.10 602.61 Td (\(2\)) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 51.50 572.54 Td (\(In millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 178.30 573.11 Td (Total) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 228.20 583.11 Td (First ) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 224.60 573.11 Td (Loss) Tj ET Q BT /F9 10.00 Tf ET BT /F9 6.00 Tf ET q 1 1 1 rg BT 242.91 576.61 Td (\(3\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 264.80 573.11 Td (Mezzanine) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 327.30 573.11 Td (Total) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 380.80 573.11 Td (Total) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 430.20 583.11 Td (First ) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 426.60 573.11 Td (Loss) Tj ET Q BT /F9 10.00 Tf ET BT /F9 6.00 Tf ET q 1 1 1 rg BT 444.91 576.61 Td (\(3\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 466.80 573.11 Td (Mezzanine) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 527.30 573.11 Td (Total) Tj ET Q BT /F9 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.50 558.82 Td (CRT Activities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 544.82 Td ( STACR transactions) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 178.40 544.82 Td ($243,007) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 234.00 544.82 Td ($1,893) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 285.00 544.82 Td ($5,042) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 336.00 544.82 Td ($6,935) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 372.90 544.82 Td ($1,059,528) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 437.00 544.82 Td ($3,789) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 481.70 544.82 Td ($27,054) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 530.70 544.82 Td ($30,843) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 530.82 Td ( ACIS transactions) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 182.70 530.82 Td (269,483) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 244.75 530.82 Td (679) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 289.35 530.82 Td (2,306) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 340.35 530.82 Td (2,985) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 377.20 530.82 Td (1,102,504) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 441.35 530.82 Td (1,561) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 486.00 530.82 Td (10,010) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 535.00 530.82 Td (11,571) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 57.50 516.82 Td (Senior subordinate) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 57.50 507.82 Td (securitization structures) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 187.00 507.82 Td (30,911) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 244.75 507.82 Td (746) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 289.35 507.82 Td (1,238) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 340.35 507.82 Td (1,984) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 388.00 507.82 Td (42,489) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 441.35 507.82 Td (1,823) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 490.35 507.82 Td (2,121) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.35 507.82 Td (3,944) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 493.82 Td ( Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 187.00 493.82 Td (11,541) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 244.75 493.82 Td (155) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 295.80 493.82 Td (345) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 346.80 493.82 Td (500) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 388.00 493.82 Td (20,602) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 441.35 493.82 Td (6,415) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.80 493.82 Td (345) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.35 493.82 Td (6,760) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 479.82 Td (Less: UPB with more than one) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 470.82 Td (type of CRT activity) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 180.50 473.82 Td (\(219,072) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 210.80 473.82 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 248.75 473.82 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 299.75 473.82 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 350.75 473.82 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 375.05 473.82 Td (\(1,017,618) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.80 473.82 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.75 473.82 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.75 473.82 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 549.75 473.82 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 57.50 459.82 Td (Total CRT Activities) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 178.40 459.82 Td ($335,870) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 234.00 459.82 Td ($3,473) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 285.00 459.82 Td ($8,931) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 331.70 459.82 Td ($12,404) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 372.90 459.82 Td ($1,207,505) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 432.70 459.82 Td ($13,588) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 481.70 459.82 Td ($39,530) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 530.70 459.82 Td ($53,118) Tj ET Q BT /F2 11.00 Tf ET BT /F12 9.00 Tf ET q 0 0 0 rg BT 58.50 438.45 Td (\() Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 61.50 438.45 Td (1\) For STACR and ACIS transactions, represents the UPB of the assets included in the reference pool. For senior subordinate securitization structure ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 427.65 Td (transactions, represents the UPB of the guaranteed securities.) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 413.85 Td (\(2\) ) Tj ET Q q 0 0 0 rg BT 76.50 413.85 Td (For STACR transactions, represents the outstanding balance held by third parties. For ACIS transactions, represents the remaining aggregate limit ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 403.05 Td (of insurance purchased from third parties. For senior subordinate securitization structures, represents the UPB of the securities that are ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 392.25 Td (subordinate to our guarantee and held by third parties.) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 378.45 Td (\(3\) First loss includes all B tranches in our STACR transactions and their equivalent in ACIS and Other CRT transactions.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 357.79 cm /I404 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 357.79 cm /I405 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 68.71 360.05 Td (We retained exposure to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 191.39 360.05 Td ($323.5 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 256.80 360.05 Td ( and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 281.47 360.05 Td ($1,154.4 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 356.06 360.05 Td ( of the protected UPB for the CRT ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 344.65 Td (issuances during 2018 and the cumulative issuances as of December 31, 2018, respectively, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 329.25 Td (including first loss and mezzanine positions.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 308.59 cm /I406 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 308.59 cm /I407 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 310.85 Td (As of December 31, 2018, we had cumulatively transferred a portion of credit risk on nearly ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 516.77 310.85 Td ($1.2 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 295.45 Td (trillion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 96.83 295.45 Td ( of our single-family mortgages, based upon the UPB at issuance of the CRT transactions.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 274.79 cm /I408 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 75.71 277.05 Td ( ) Tj ET Q q 0 0 0 rg BT 85.50 277.05 Td (FHFA's conservatorship capital needed for credit risk was reduced by approximately 60% ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 261.65 Td (through CRT transactions on new business activity in the twelve months ended December 31, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 246.25 Td (2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 225.59 cm /I409 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 225.59 cm /I410 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 227.85 Td (The reduction in the amount of conservatorship capital needed for credit risk on new business ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 212.45 Td (activity is calculated as conservatorship credit capital released from CRT transactions \(primarily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 197.05 Td (through STACR and ACIS\) divided by total conservatorship credit capital on new business ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 181.65 Td (activity at the time of purchase. For more information on the CCF and the calculation of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 166.25 Td (conservatorship capital, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 226.41 166.25 Td (Liquidity and Capital Resources - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 420.06 166.25 Td (Capital Resources - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 85.50 150.85 Td (Conservatorship Capital Framework - Return on Conservatorship Capital.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 130.19 cm /I411 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 130.19 cm /I412 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 68.71 132.45 Td (In September 2018, we modified our primary CRT structure to reduce conservatorship capital ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 117.05 Td (needed for credit risk by approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 262.16 117.05 Td (80%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 285.39 117.05 Td ( on related new business activity. This modified ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 101.65 Td (structure sells more of the first loss position and extends the maturity from 12.5 to 30 years.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 80.99 cm /I413 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 80.99 cm /I414 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 68.71 83.25 Td (In 2018, we paid ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 153.07 83.25 Td ($728 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 212.18 83.25 Td ( in interest expense, net of reinvestment income, on our outstanding ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 67.85 Td (STACR transactions and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 189.99 67.85 Td ($317 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 249.09 67.85 Td ( in ACIS premiums, compared to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 412.20 67.85 Td ($621 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 471.30 67.85 Td ( in interest ) Tj ET Q endstream endobj 109 0 obj <> endobj 110 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (50) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 739.15 Td (expense, net of reinvestment income, on our outstanding STACR transactions and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 473.03 739.15 Td ($234 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 532.13 739.15 Td ( in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.75 Td (ACIS premiums in 2017. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 703.09 cm /I415 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 703.09 cm /I416 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 705.35 Td (As of December 31, 2018, we had experienced minimal write-downs on our STACR transactions and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 689.95 Td (filed minimal claims for reimbursement of losses under our ACIS transactions. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 668.55 Td (We are continually evaluating our credit risk transfer strategy and make changes depending on market ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 653.15 Td (conditions and our business strategy. The aggregate cost of our credit risk transfer activity, as well as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 637.75 Td (the amount of risk transferred, will continue to increase as we continue to do new transactions.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 614.95 Td (Loss Mitigation Activities) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 603.75 m 562.5 603.75 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 64.60 582.55 Td (Number of Families Helped to Avoid Foreclosure) Tj ET Q /GS0 gs q 238.50 0 0 224.00 49.50 350.55 cm /I417 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 395.75 582.55 Td (Loan Workout Activity) Tj ET Q /GS0 gs q 238.50 0 0 285.00 324.00 289.55 cm /I418 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 276.89 cm /I419 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 276.89 cm /I420 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 279.15 Td (We continue to help struggling families retain their homes or otherwise avoid foreclosure through ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 263.75 Td (loan workouts. Our loan workout activity increased in 2018 compared to 2017, primarily driven by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 248.35 Td (the hurricanes in 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 227.69 cm /I421 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 227.69 cm /I422 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 229.95 Td (As part of our strategy to mitigate losses and reduce our holdings of less liquid assets, we sold ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 214.55 Td (seriously delinquent loans totaling ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 237.29 214.55 Td ($0.7 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 290.47 214.55 Td ( in UPB during 2018. Of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 428.84 214.55 Td ($20.9 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 488.15 214.55 Td ( in UPB of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 199.15 Td (single-family loans classified as held-for-sale at December 31, 2018, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 405.86 199.15 Td ($2.6 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 459.05 199.15 Td ( related to loans that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 183.75 Td (were seriously delinquent. We believe selling certain of these loans provides better economic returns ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 168.35 Td (than continuing to hold them. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 147.69 cm /I423 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 147.69 cm /I424 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 149.95 Td (The relief refinance program has been replaced with the Enhanced Relief Refinance program, which ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 134.55 Td (became available in January 2019 for loans originated on or after October 1, 2017. This program ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 119.15 Td (provides liquidity for borrowers who are current on their mortgages but are unable to refinance ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 103.75 Td (because their LTV ratios exceed our standard refinance limits. While the HARP program ended in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 88.35 Td (December 2018, we will continue to purchase HARP loans with application received dates on or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 72.95 Td (prior to December 31, 2018 through September 30, 2019.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 51.55 Td (See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 71.50 51.55 Td (Risk Management) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 173.77 51.55 Td ( for additional information on our loan workout activities. ) Tj ET Q endstream endobj 111 0 obj <> endobj 112 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (51) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Financial Results) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 702.55 Td (The table below presents the components of the Segment Earnings and comprehensive income for our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 687.15 Td (Single-family Guarantee segment.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 665.75 Td (Table 13 - Single-Family Guarantee Segment Financial Results) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 378.00 655.25 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 239.00 640.25 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 378.00 640.25 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 472.00 640.25 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 625.25 185.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 239.00 625.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 284.00 625.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 329.00 625.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 378.00 625.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 423.00 625.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 472.00 625.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 517.00 625.25 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 284 625.25 m 284 610.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 329 625.25 m 329 610.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 423 625.25 m 423 610.25 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 517 625.25 m 517 610.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 519.25 m 235 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 519.25 m 284 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 519.25 m 329 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 519.25 m 374 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 519.25 m 423 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 519.25 m 468 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 519.25 m 517 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 519.25 m 562 519.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 493.25 m 235 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 493.25 m 284 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 493.25 m 329 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 493.25 m 374 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 493.25 m 423 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 493.25 m 468 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 493.25 m 517 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 493.25 m 562 493.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 467.25 m 235 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 455.25 m 235 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 453.25 m 235 453.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 467.25 m 284 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 455.25 m 284 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 453.25 m 284 453.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 467.25 m 329 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 455.25 m 329 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 453.25 m 329 453.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 467.25 m 374 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 455.25 m 374 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 453.25 m 374 453.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 467.25 m 423 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 455.25 m 423 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 453.25 m 423 453.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 467.25 m 468 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 455.25 m 468 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 453.25 m 468 453.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 467.25 m 517 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 455.25 m 517 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 453.25 m 517 453.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 467.25 m 562 467.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 455.25 m 562 455.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 453.25 m 562 453.25 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 424.90 645.61 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 255.60 630.61 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.45 630.61 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 630.61 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 615.04 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 251.40 615.61 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 296.40 615.61 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 341.40 615.61 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 397.60 615.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 441.10 615.61 Td (%) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 491.60 615.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 535.10 615.61 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 601.32 Td (Guarantee fee income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 257.00 601.32 Td ($6,570) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 302.00 601.32 Td ($6,350) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 347.00 601.32 Td ($6,356) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 402.50 601.32 Td ($220) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 454.15 601.32 Td (3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 601.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 502.95 601.32 Td (\($6) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 601.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 543.50 601.32 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 601.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 588.32 Td (Benefit \(provision\) for credit losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.80 588.32 Td (522) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 310.65 588.32 Td (\(770) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 588.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.65 588.32 Td (\(481) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 588.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 400.35 588.32 Td (1,292) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.50 588.32 Td (168) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 588.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 588.32 Td (\(289) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 588.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.65 588.32 Td (\(60) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.50 588.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 575.32 Td (Financial instrument gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 167.29 578.47 Td (\(1\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.80 575.32 Td (174) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 310.65 575.32 Td (\(245) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 575.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.65 575.32 Td (\(391) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 575.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 406.80 575.32 Td (419) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.50 575.32 Td (171) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 575.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 575.32 Td (146) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 543.85 575.32 Td (37) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 575.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 562.32 Td (Other non-interest income \(loss\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.80 562.32 Td (905) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 306.35 562.32 Td (1,838) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 562.32 Td (928) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.65 562.32 Td (\(933) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 419.80 562.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 447.65 562.32 Td (\(51) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.50 562.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 500.80 562.32 Td (910) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 543.85 562.32 Td (98) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 562.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 549.32 Td (Administrative expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 259.15 549.32 Td (\(1,491) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 549.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 304.15 549.32 Td (\(1,381) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 549.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 349.15 549.32 Td (\(1,323) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 549.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.65 549.32 Td (\(110) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 419.80 549.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 452.00 549.32 Td (\(8) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.50 549.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 502.95 549.32 Td (\(58) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 549.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.00 549.32 Td (\(4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.50 549.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 536.32 Td (REO operations income \(expense\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 265.65 536.32 Td (\(189) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 536.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 310.65 536.32 Td (\(203) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 536.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.65 536.32 Td (\(298) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 536.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 411.15 536.32 Td (14) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 454.15 536.32 Td (7) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 536.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 505.15 536.32 Td (95) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 543.85 536.32 Td (32) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 536.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 523.32 Td (Other non-interest expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 259.15 523.32 Td (\(1,639) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 523.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 304.15 523.32 Td (\(1,382) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 523.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 349.15 523.32 Td (\(1,169) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 523.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 404.65 523.32 Td (\(257) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 419.80 523.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 447.65 523.32 Td (\(19) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.50 523.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 523.32 Td (\(213) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 523.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.65 523.32 Td (\(18) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.50 523.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 510.32 Td (Segment Earnings before income tax expense) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 261.35 510.32 Td (4,852) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 306.35 510.32 Td (4,207) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 351.35 510.32 Td (3,622) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 406.80 510.32 Td (645) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 449.85 510.32 Td (15) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 460.45 510.32 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 500.80 510.32 Td (585) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 543.85 510.32 Td (16) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 554.45 510.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 497.32 Td (Income tax expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 265.65 497.32 Td (\(944) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 497.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 304.15 497.32 Td (\(1,448) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 325.80 497.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 349.15 497.32 Td (\(1,185) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 497.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 406.80 497.32 Td (504) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 449.85 497.32 Td (35) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 497.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 498.65 497.32 Td (\(263) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 513.80 497.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 541.65 497.32 Td (\(22) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.50 497.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 484.32 Td (Segment Earnings, net of taxes) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 261.35 484.32 Td (3,908) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 306.35 484.32 Td (2,759) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 351.35 484.32 Td (2,437) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 400.35 484.32 Td (1,149) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 449.85 484.32 Td (42) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 460.45 484.32 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 500.80 484.32 Td (322) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 543.85 484.32 Td (13) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 554.45 484.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 471.32 Td (Total other comprehensive income \(loss\), net of tax) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 274.30 471.32 Td (\(3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 280.80 471.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 317.15 471.32 Td (40) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 364.30 471.32 Td (\(9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 370.80 471.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 408.95 471.32 Td (\(43) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 419.80 471.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 443.35 471.32 Td (\(108) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.50 471.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 505.15 471.32 Td (49) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.50 471.32 Td (544) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 554.65 471.32 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 458.32 Td (Total comprehensive income \(loss\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 257.00 458.32 Td ($3,905) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 302.00 458.32 Td ($2,799) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 347.00 458.32 Td ($2,428) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 396.00 458.32 Td ($1,106) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 449.85 458.32 Td (40) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 460.45 458.32 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 496.50 458.32 Td ($371) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 543.85 458.32 Td (15) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 554.45 458.32 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 437.95 Td (\(1\) ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 437.95 Td (Consists of fair value gains and losses on debt for which we have elected the fair value option and derivatives. ) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 416.55 Td (Key Drivers: ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 392.89 cm /I425 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 392.89 cm /I426 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 395.15 Td (2018 vs. 2017) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 137.23 395.15 Td ( ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 374.49 cm /I427 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 374.49 cm /I428 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 376.75 Td (Continued growth in our single-family credit guarantee portfolio and increased credit fee/buy-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 361.35 Td (down short-term returns, resulting in increased guarantee fee income.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 340.69 cm /I429 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 340.69 cm /I430 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 342.95 Td (Increased benefit for credit losses during 2018 primarily driven by estimated losses from the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 327.55 Td (hurricanes in 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 306.89 cm /I431 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 306.89 cm /I432 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 309.15 Td (Lower gains during 2018 compared to 2017 on single-family seasoned loan reclassifications ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 293.75 Td (between held-for-investment and held-for-sale.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 273.09 cm /I433 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 273.09 cm /I434 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 275.35 Td (Fair value gains on STACR debt notes during 2018 compared to fair value losses during 2017 as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 259.95 Td (a result of market spreads between STACR yields and LIBOR widening during 2018, while ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 244.55 Td (spreads tightened during 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 223.89 cm /I435 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 223.89 cm /I436 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 226.15 Td (Higher outstanding cumulative volumes of CRT transactions that resulted in increased CRT ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 210.75 Td (expense \(interest expense on STACR transactions and premiums paid to ACIS counterparties\) in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 195.35 Td (2018.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 171.69 cm /I437 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 171.69 cm /I438 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 173.95 Td (2017 vs. 2016) Tj ET Q BT /F12 11.00 Tf ET q 0 0 0 rg BT 137.23 173.95 Td ( ) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 140.29 173.95 Td ( ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 153.29 cm /I439 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 153.29 cm /I440 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 155.55 Td (Continued growth in our single-family credit guarantee portfolio and higher average contractual ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 140.15 Td (guarantee fee rates, offset by lower upfront fee amortization due to lower prepayments, resulting ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 124.75 Td (in guarantee fee income remaining relatively unchanged.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 104.09 cm /I441 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 104.09 cm /I442 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 106.35 Td (Decline in benefit for credit losses primarily driven by estimated losses related to the hurricanes ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 90.95 Td (in 2017, offset by improvements in loss severity.) Tj ET Q endstream endobj 113 0 obj <> endobj 114 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 344.50 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 442.67 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 445.17 764.07 Td (Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (52) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 67.50 736.29 cm /I443 Do Q /GS0 gs q 11.00 0 0 11.74 75.71 736.29 cm /I444 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 86.71 738.55 Td (Higher volume of reperforming loans reclassified from held-for-investment to held-for-sale and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 723.15 Td (subsequently sold resulted in gains in 2017 compared to losses recognized on seriously ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 707.75 Td (delinquent loans in 2016.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 687.09 cm /I445 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 687.09 cm /I446 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 689.35 Td (Higher outstanding cumulative volumes of CRT transactions that resulted in increased credit risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 673.95 Td (transfer expense \(interest expense on STACR debt notes and premiums paid to ACIS ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 658.55 Td (counterparties\).) Tj ET Q endstream endobj 115 0 obj <> endobj 116 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (53) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 733.30 Td (Multifamily) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 705.70 Td (Business Overview) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 694.5 m 562.5 694.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.10 Td (The Multifamily segment supports our primary business strategies by creating:) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 649.70 Td (A Better Freddie Mac:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 629.04 cm /I447 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 629.04 cm /I448 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 631.30 Td (Continuing to provide financing to the multifamily mortgage market and expanding our market ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 615.90 Td (presence for workforce housing in line with our mission;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 595.24 cm /I449 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 595.24 cm /I450 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 597.50 Td (Improving our risk-adjusted returns by leveraging private capital in our risk transfer transactions; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 576.84 cm /I451 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 576.84 cm /I452 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 579.10 Td (Identifying new opportunities beyond our existing K Certificate and SB Certificate transactions to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 563.70 Td (cost-effectively transfer risk to third parties and reduce taxpayer exposure; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 543.04 cm /I453 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 543.04 cm /I454 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 545.30 Td (Maintaining strong credit and capital management discipline.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 523.90 Td (A Better Housing Finance System:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 503.24 cm /I455 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 503.24 cm /I456 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 505.50 Td (Operating in a customer focused manner to build business value and support the creation of a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 490.10 Td (strong, long-lasting rental housing system;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 469.44 cm /I457 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 469.44 cm /I458 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 471.70 Td (Fostering innovation through the development of products that expand the availability of workforce ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 456.30 Td (housing in the marketplace; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 435.64 cm /I459 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 435.64 cm /I460 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 437.90 Td (Leveraging technology to make the multifamily loan process more efficient industry-wide.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 416.50 Td (The Multifamily segment provides liquidity and support to the multifamily mortgage market through a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 401.10 Td (variety of activities that include the purchase, guarantee, sale, and/or securitization of multifamily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 385.70 Td (mortgage loans and mortgage-related securities. The overall market demand for multifamily loans is ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 370.30 Td (generally affected by local and regional economic factors, such as unemployment rates, construction ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 354.90 Td (cycles, property prices, preferences for homeownership versus renting, and the relative affordability of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 339.50 Td (single-family homes, as well as certain macroeconomic factors, such as interest rates. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 318.10 Td (Our primary business model is to acquire multifamily loans for aggregation and then securitization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 302.70 Td (through the issuance and guarantee of debt securities. The returns we generate from these activities are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 287.30 Td (primarily derived from \(i\) the net interest income we earn on the loans prior to their securitization, \(ii\) the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 271.90 Td (price received upon securitization of the loans versus the price we paid to acquire the loans, and \(iii\) the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 256.50 Td (ongoing guarantee fee we receive in exchange for providing our guarantee primarily on the issued senior ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 241.10 Td (securities. We evaluate these factors collectively to maximize our returns and to assess the profitability ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 225.70 Td (of any given transaction.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 204.30 Td (Our securitization activities generally \(i\) provide us with a mechanism to finance our loan product ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 188.90 Td (offerings, \(ii\) transfer to third parties a large majority of expected and stress credit risk on the loans that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 173.50 Td (we purchase, \(iii\) reduce our interest-rate risk exposure, and \(iv\) reduce our conservatorship capital ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 158.10 Td (under CCF. For multifamily loans that we do not intend to securitize, we may pursue other strategies, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 142.70 Td (including structured sales or the execution of other risk transfer products designed to transfer to third ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 127.30 Td (parties all or a portion of the loans' interest-rate risk and credit risk, thereby reducing taxpayer exposure.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 105.90 Td (Our support of the multifamily market generally begins with our underwriting of the mortgage loans that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 90.50 Td (we commit to purchase from our approved lenders and typically ends with the disposition of those ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 75.10 Td (loans, generally through a borrower payoff. Through our support of the multifamily mortgage market, ) Tj ET Q endstream endobj 117 0 obj <> endobj 118 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (54) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (borrowers can obtain lower financing costs, which can benefit renters through lower rental rates and/or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (improved services or amenities.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 702.95 Td (Products and Activities) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 691.75 m 562.5 691.75 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 668.35 Td (Loan Products) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 646.95 Td (Through our network of approved lenders, we offer borrowers a variety of loan products for the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 631.55 Td (acquisition, refinance, and/or rehabilitation of multifamily properties. While our approved lenders ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 616.15 Td (originate the loans that we purchase, we use a prior-approval underwriting approach, in contrast to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 600.75 Td (delegated underwriting approach used in our Single-family Guarantee segment. Under this approach, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 585.35 Td (we maintain credit discipline by completing our own underwriting, credit review, and legal review for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 569.95 Td (each loan, including review of third-party appraisals and cash flow analysis, prior to issuing a loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 554.55 Td (purchase commitment. We also price every loan or transaction based on the specific terms, structure, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 539.15 Td (and type of execution.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 517.75 Td (Multifamily loans are typically originated by our lenders without recourse to the borrower, making ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 502.35 Td (repayment dependent on the cash flows generated by the underlying property. Cash flows generated by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 486.95 Td (a property are significantly influenced by vacancy and rental rates, as well as conditions in the local ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 471.55 Td (rental market, the physical condition of the property, the quality of property management, and the level ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 456.15 Td (of operating expenses.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 434.75 Td (Our primary multifamily loan products include the following:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 414.09 cm /I461 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 414.09 cm /I462 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 416.35 Td (Conventional loans) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 167.92 416.35 Td ( - Financing that includes fixed-rate and floating-rate loans, loans in lease-up ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 400.95 Td (and with moderate property upgrades, manufactured housing community loans, senior housing ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 385.55 Td (loans, student housing loans, supplemental loans, and certain Green Advantage loans.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 364.89 cm /I463 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 364.89 cm /I464 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 367.15 Td (Small balance loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 175.41 367.15 Td (- Financing provided to small rental property borrowers for the acquisition or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 351.75 Td (refinance of multifamily properties. Financing ranges from $1 million to $7.5 million and is focused on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 336.35 Td (affordable or workforce housing properties from 5 to 50 units. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 315.69 cm /I465 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 315.69 cm /I466 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 317.95 Td (Targeted affordable housing) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 214.85 317.95 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 217.90 317.95 Td (- Financing provided to borrowers in underserved areas that have ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 302.55 Td (restricted units affordable to households with low income \(earning up to 80% of the area median ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 287.15 Td (income\) and very-low income \(earning up to 50% of the area median income\) and that typically ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 271.75 Td (receive government subsidies. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 250.35 Td (The amount and type of multifamily loans that we purchase is significantly influenced by the production ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 234.95 Td (cap that is established by the annual Conservatorship Scorecard, which limits the aggregate UPB of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 219.55 Td (multifamily loans we may purchase in a year. While purchases of certain multifamily loans are subject to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 204.15 Td (the cap, purchases of multifamily loans that support workforce housing in affordable and underserved ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 188.75 Td (markets and that support improvements to energy or water efficiency are generally not subject to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 173.35 Td (cap. Examples of multifamily loans that are either not subject to the cap or only partially subject to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 157.95 Td (cap include certain senior housing loans, small balance loans, manufactured housing loans, targeted ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 142.55 Td (affordable housing loans, and Green Advantage loans.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 121.15 Td (In addition, the amount and type of multifamily loans that we purchase is influenced by our current ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 105.75 Td (business strategy \(e.g., whether to maintain or grow our share of the multifamily mortgage market\) and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 90.35 Td (overall market demand for multifamily loan products.) Tj ET Q endstream endobj 119 0 obj <> endobj 120 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (55) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (Index Lock Commitments) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 719.75 Td (We offer borrowers an option to lock the Treasury index component of their fixed interest-rate loans at ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 704.35 Td (any time after the loan is under application with an approved lender. This option enables borrowers to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 688.95 Td (lock the most volatile part of their coupon, thereby providing an enhanced level of risk mitigation against ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 673.55 Td (interest-rate volatility. The index lock commitment period for most loans is 60 days and is generally ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 658.15 Td (followed by a loan purchase commitment. These commitments do not qualify for accounting recognition ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 642.75 Td (and therefore temporarily introduce volatility in our financial results until they proceed to a loan purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 627.35 Td (commitment.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 605.95 Td (We economically hedge our interest-rate exposure resulting from these commitments primarily by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 590.55 Td (entering into pay-fixed, receive-float interest rate swaps. ) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 50.00 580.05 510.00 -20.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 530.05 m 58 530.05 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58 530.05 m 560 530.05 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 567.91 Td (The primary impact to Segment Earnings is:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.00 546.41 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 546.41 Td (Fair value gains or losses recognized on interest-rate derivatives. These gains or losses are offset once an index lock commitment ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 536.41 Td (becomes a loan purchase commitment and is accounted for at fair value.) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 509.15 Td (Loan Purchase Commitments) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 487.75 Td (Prior to issuing an unconditional commitment to purchase a multifamily loan, we negotiate with the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 472.35 Td (lender and borrower to determine the specific economic terms and conditions of our commitment, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 456.95 Td (including the loan's purchase price, index, or mortgage spread. During periods when we seek to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 441.55 Td (increase our share of the total multifamily mortgage debt outstanding, we strategically bid more ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 426.15 Td (competitively, generally resulting in a higher commitment price or lower mortgage spread, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 410.75 Td (potentially reduced profitability. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 389.35 Td (At the time we commit to purchase a multifamily loan, we preliminarily determine our intent with respect ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 373.95 Td (to that loan. For commitments to purchase loans that we intend to sell or securitize \(i.e., held-for-sale ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 358.55 Td (commitments\), we elect the fair value option and therefore recognize and measure these commitments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 343.15 Td (at fair value on our consolidated financial statements. No such election is made for commitments to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 327.75 Td (purchase loans that we intend to hold for the foreseeable future \(i.e., held-for-investment commitments\), ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 312.35 Td (and therefore these commitments are not recognized on our consolidated financial statements. ) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 50.00 301.85 510.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 225.85 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 225.85 502.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 221.85 8.00 -37.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 221.85 502.00 -37.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 184.85 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 184.85 502.00 -4.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 225.85000000000002 m 58 225.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58 225.85000000000002 m 560 225.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 180.85000000000002 m 58 180.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 58 180.85000000000002 m 560 180.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 157.85000000000002 m 58 157.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58 157.85000000000002 m 560 157.85000000000002 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 289.71 Td (The primary impacts to Segment Earnings are:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.00 268.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 268.21 Td (For each of our held-for-sale commitments, at the commitment date, we recognize the estimated fair value of the commitment, which ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 258.21 Td (represents the gain we expect to realize on the sale of the loan. This unrealized gain, which results from our ability to purchase loans ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 248.21 Td (in the whole loan market while exiting through the securitization market, effectively represents the incremental benefit that can be ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 238.21 Td (realized by accessing the securitization market; ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 51.00 212.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 212.21 Td (After the commitment date, but prior to settlement, we recognize changes in the fair value of the commitment. These fair value ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 202.21 Td (adjustments result from changes in the pricing of our securitizations due to changes in interest rates and securitization market ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 192.21 Td (spreads; and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 51.00 167.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 167.21 Td (Fair value gains or losses recognized on interest-rate derivatives.) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 136.95 Td (Loan Purchases) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 115.55 Td (When we purchase a loan, we finalize our intent with respect to that loan. Multifamily loans that we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 100.15 Td (intend to hold for the foreseeable future are classified as held-for-investment and measured at amortized ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 84.75 Td (cost, while multifamily loans that we intend to sell or securitize are classified as held-for-sale and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 69.35 Td (typically measured at fair value through a separate fair value option election. ) Tj ET Q endstream endobj 121 0 obj <> endobj 122 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (56) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (The vast majority of all new multifamily loan purchases are initially classified as held-for-sale and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (included in our securitization pipeline. The holding period for loans in our securitization pipeline ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 710.35 Td (generally ranges between two and five months, as we aggregate sufficient loans with similar terms and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.95 Td (risk characteristics to securitize. For example, loans purchased during the first quarter will generally be ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 679.55 Td (used as collateral for securitizations that occur in the second and third quarters of that same year.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 658.15 Td (Our multifamily held-for-sale commitments and held-for-sale loans are subject to changes in fair value ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 642.75 Td (due to two main risks: \(i\) interest-rate risk and \(ii\) spread risk. While we use derivatives to economically ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 627.35 Td (hedge the interest rate-related fair value changes of most of our multifamily commitments and loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 611.95 Td (measured at fair value, we continue to be exposed to spread-related fair value changes. We partially ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 596.55 Td (reduce our spread-related fair value exposure by purchasing or entering into certain spread-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 581.15 Td (derivatives, thereby obtaining some protection against significant adverse movements in market ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 565.75 Td (spreads. We refer to the fair value adjustments resulting from changes in these risks, net of any ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 550.35 Td (offsetting fair value adjustments from our derivatives, as our holding period fair value gains and losses.) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 50.00 539.85 510.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 481.85 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 481.85 502.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 477.85 8.00 -26.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 477.85 502.00 -26.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 451.85 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 451.85 502.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 413.85 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 413.85 502.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 409.85 8.00 -17.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 409.85 502.00 -17.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 392.85 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.00 392.85 502.00 -4.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 481.85 m 58 481.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58 481.85 m 560 481.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 447.85 m 58 447.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58 447.85 m 560 447.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 413.85 m 58 413.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58 413.85 m 560 413.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 388.85 m 58 388.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58 388.85 m 560 388.85 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 527.71 Td (The primary impacts to Segment Earnings are:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.00 506.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 503.71 Td (During the holding period, we recognize changes in the fair value of loans classified as held-for-sale. These fair value adjustments) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 493.71 Td (result from changes in the pricing of our securitizations due to changes in interest rates and securitization market spreads;) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 51.00 468.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 468.21 Td (Fair value gains or losses recognized on interest-rate derivatives. These changes generally offset interest-rate related fair value) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 456.21 Td (changes on the loans;) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 51.00 428.71 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 433.71 Td (Fair value gains or losses recognized on spread-related derivatives. These changes may offset spread-related fair value changes on) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 423.71 Td (the loans; and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 51.00 400.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.50 399.21 Td (Interest income on loans while held in our mortgage-related investments portfolio.) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 367.95 Td (Securitization, Guarantee, and Other Risk Transfer Products) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 346.55 Td (In our Multifamily segment, we enter into various types of securitizations and other risk transfer products ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 331.15 Td (that generally result in the transfer of all or a portion of the underlying collateral's interest-rate risk and/or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 315.75 Td (credit risk to third parties. These activities, except for our other risk transfer products \(e.g., loan sales ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 300.35 Td (and SCR notes\), make up our guarantee portfolio.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 278.95 Td (The collateral used in our securitization activities can vary and may include loans underwritten and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 263.55 Td (purchased by us at loan origination or loans we do not own prior to securitization and that we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 248.15 Td (underwrite after \(rather than at\) origination. In our typical securitizations, we guarantee the issued senior ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 232.75 Td (securities. In exchange for providing this guarantee, we receive an ongoing guarantee fee that is ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 217.35 Td (commensurate with the risks assumed and that will, over the long-term, provide us with guarantee fee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 201.95 Td (income that is expected to exceed the credit-related and administrative expenses of the underlying ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 186.55 Td (loans. Structural deal features, such as term, type of underlying loan product, and subordination levels, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 171.15 Td (generally influence the deal's risk profile, which ultimately affects the guarantee fee rate we set at the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 155.75 Td (time of securitization.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 134.35 Td (Our typical securitization structure and level of subordination are designed to obtain a AAA credit rating ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 118.95 Td (on the guaranteed securities to maximize the return we earn when we sell loans for securitization. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 103.55 Td (Depending on the securitization product and subordination levels selected, we may realize a higher ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 88.15 Td (\(lower\) gain on sale, but recognize lower \(higher\) ongoing guarantee fee income. ) Tj ET Q endstream endobj 123 0 obj <> endobj 124 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (57) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (We continue to seek new and innovative risk transfer opportunities beyond our current product offerings ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (so that we can provide further liquidity to the multifamily market and reduce taxpayer exposure to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 710.35 Td (interest-rate risk and credit risk. ) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 688.95 Td (Primary Risk Transfer Securitization Activities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 670.55 Td (Our primary risk transfer securitization products are K Certificates and SB Certificates, which transfer ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 655.15 Td (substantially all of the interest-rate risk and credit risk of the associated collateral. The structures of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 639.75 Td (these transactions typically involve the issuance of senior, mezzanine, and subordinated securities that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 624.35 Td (represent undivided beneficial interests in trusts that hold pools of multifamily loans that we previously ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 608.95 Td (purchased. The volume of our primary risk transfer securitizations is generally influenced by the size of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 593.55 Td (our securitization pipeline, along with market demand for multifamily securities. As shown in the diagram ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 578.15 Td (below, in a typical K Certificate transaction, we sell multifamily loans to a non-Freddie Mac securitization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 562.75 Td (trust that issues senior, mezzanine, and subordinated securities, and simultaneously purchase and place ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 547.35 Td (the senior securities into a Freddie Mac securitization trust that issues guaranteed K Certificates. In ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 531.95 Td (these transactions, we guarantee the senior securities, but do not issue or guarantee the mezzanine or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 516.55 Td (subordinated securities. As a result, the interest-rate risk and a large majority of expected and stress ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 501.15 Td (credit risk is sold to third-party investors through the mezzanine and subordinated securities, thereby ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 485.75 Td (reducing our risk exposure.) Tj ET Q /GS0 gs q 513.00 0 0 288.95 49.50 185.80 cm /I467 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 159.14 cm /I468 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 159.14 cm /I469 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 161.40 Td (K Certificates) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 139.15 161.40 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 142.21 161.40 Td (- Regularly issued structured pass-through securities backed by recently originated ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 146.00 Td (multifamily loans. This product provides investors with a wide-range of structural and collateral ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 130.60 Td (options that provide for stable cash flows and a structured credit enhancement. While the amount of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 115.20 Td (guarantee fee we receive may vary by collateral type, it is generally fixed for those K Certificate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 99.80 Td (series that we issue with regular frequency \(e.g., 5, 7, and 10-year fixed-rate K Certificates and our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 84.40 Td (Floating Rate K Certificates\). The guarantee fee received on these standard K Certificates currently ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 69.00 Td (ranges between 20 basis points and 45 basis points.) Tj ET Q endstream endobj 125 0 obj <> endobj 126 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (58) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 741.15 Td (The guarantee fee on K Certificates that we do not issue on a regular basis, such as our single-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 725.75 Td (sponsor K Certificates, is determined based on the specific risks associated with the underlying ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 710.35 Td (collateral and the structure of the securitization, including tranche sizes and risk distribution.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 689.69 cm /I470 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 689.69 cm /I471 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 691.95 Td (SB Certificates) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 146.10 691.95 Td ( - Regularly issued securities typically backed by multifamily small balance loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 676.55 Td (that we underwrite at loan origination and purchase prior to securitization. Similar to our K Certificate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 661.15 Td (transactions, a non-Freddie Mac trust will issue the senior classes of securities, which we guarantee, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 645.75 Td (as well as the unguaranteed subordinated securities. However, unlike our K Certificate transactions, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 630.35 Td (while we may purchase a portion of the senior securities, we do not place those securities into a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 614.95 Td (Freddie Mac trust. The guarantee fee we receive in these transactions is generally 35 basis points.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 596.55 Td (From time to time, we may undertake certain activities to support the liquidity of K Certificates and SB ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 581.15 Td (Certificates. For more information, see ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 240.20 581.15 Td (Risk Factors - Other Risks - ) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 388.37 581.15 Td (The profitability of our ) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 565.75 Td (multifamily business could be adversely affected by a significant decrease in demand for our K ) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 550.35 Td (Certificates and SB Certificates.) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 528.95 Td (Other Risk Transfer Securitizations) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 507.55 Td (Our other risk transfer securitizations involve the issuance of single-class or multi-class pass-through ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 492.15 Td (securities that represent beneficial interests in trusts that hold pools of multifamily loans. We guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 476.75 Td (the single-class securities and may guarantee some or all of the multi-class securities. The collateral for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 461.35 Td (these securitizations may include loans underwritten and purchased by us at loan origination or loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 445.95 Td (we do not own prior to securitization and that we underwrite after \(rather than at\) origination. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 427.55 Td (Our other risk transfer securitizations include the following:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 406.89 cm /I472 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 406.89 cm /I473 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 409.15 Td (PCs) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 88.90 409.15 Td ( - We securitize multifamily loans into fixed-rate pass-through securities that are similar in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 393.75 Td (structure to our Single-family Guarantee segment fixed-rate PCs. In these securitizations, we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 378.35 Td (guarantee the full payment of principal and timely payment of interest and direct loss mitigation ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 362.95 Td (activities. As a result, we consolidate this structure.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 342.29 cm /I474 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 342.29 cm /I475 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 344.55 Td (K Certificates without subordination) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 256.99 344.55 Td ( - We securitize multifamily loans that we own and issue K ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 329.15 Td (Certificates without subordination using a transaction structure similar to our K Certificates. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 313.75 Td (However, unlike K Certificates, these transactions are fully guaranteed by Freddie Mac and no ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 298.35 Td (mezzanine or subordinated securities are issued. In addition, we direct loss mitigation activities and, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 282.95 Td (as a result, we consolidate this structure.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 262.29 cm /I476 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 262.29 cm /I477 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 264.55 Td (ML Certificates ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 150.77 264.55 Td (- We securitize pools of tax-exempt or taxable loans that we underwrite and own ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 249.15 Td (prior to securitization and the trust issues both guaranteed senior ML Certificates and unguaranteed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 233.75 Td (subordinated ML Certificates.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 213.09 cm /I478 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 213.09 cm /I479 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 215.35 Td (Multifamily Aggregation Risk Transfer Certificates \(KT Certificates\) ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 418.85 215.35 Td (- These securities are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 199.95 Td (backed by a revolving pool of multifamily loans that are awaiting sale into a K Certificate transaction. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 184.55 Td (Using this structure, we issue guaranteed senior certificates generally purchased by Freddie Mac ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 169.15 Td (and unguaranteed mezzanine and subordinated securities to third parties. During the revolving ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 153.75 Td (period of this product, we will purchase loans from the KT trust for sale into a K Certificate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 138.35 Td (transaction and replace those purchased loans with additional eligible loans. Through this product, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 122.95 Td (we transfer a portion of the front-end credit risk associated with our securitization pipeline prior to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 107.55 Td (final securitization. Given our right to purchase loans from the KT trust along with our guarantee of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 92.15 Td (the senior certificates, we consolidate this structure and the loans in the revolving pool remain in our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 76.75 Td (securitization pipeline until securitization.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 56.09 cm /I480 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 56.09 cm /I481 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 58.35 Td (KI Certificates) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 142.40 58.35 Td ( - We issue KI Certificates using a securitization structure that is similar to our K ) Tj ET Q endstream endobj 127 0 obj <> endobj 128 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (59) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 741.15 Td (Certificates and that provides for structural credit enhancements through subordination. However, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 725.75 Td (unlike K Certificates, the loans backing the KI Certificates are contributed by third-party whole loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 710.35 Td (funds.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 689.69 cm /I482 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 689.69 cm /I483 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 691.95 Td (Q Certificates) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 139.77 691.95 Td ( - We issue Q Certificates using a securitization structure that is similar to our K ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 676.55 Td (Certificates and that provides for structural credit enhancements that may include either ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 661.15 Td (subordination or other loss sharing features. However, unlike K Certificates, the loans backing the Q ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 645.75 Td (Certificates are contributed by third parties \(i.e., we do not own them prior to securitization\) and are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 630.35 Td (underwritten by us after \(rather than at\) origination. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 609.69 cm /I484 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 609.69 cm /I485 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 611.95 Td (M Certificates) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 141.19 611.95 Td ( - We securitize pools of tax-exempt or taxable multifamily housing revenue bonds ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 596.55 Td (typically contributed by third parties and issue guaranteed senior M Certificates and unguaranteed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 581.15 Td (subordinated M Certificates. ) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 562.75 Td (Summary of Our Primary Business Model and Its Impacts to Segment Earnings) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 544.35 Td (The following diagram summarizes the activities included in our primary business model and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 528.95 Td (corresponding impacts to our Segment Earnings. ) Tj ET Q /GS0 gs q 513.00 0 0 256.75 49.50 261.24 cm /I486 Do Q BT /F2 11.00 Tf ET BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 242.05 Td (Other Risk Transfer Products) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 201.89 242.05 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 220.65 Td (For the multifamily assets for which we have not transferred interest-rate risk or credit risk through ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 205.25 Td (securitizations, we may pursue other strategies to reduce our risk exposure. Our other risk transfer ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 189.85 Td (products include the following:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 169.19 cm /I487 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 169.19 cm /I488 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 171.45 Td (SCR notes) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 123.07 171.45 Td ( - Through the issuance of our SCR notes, which are unsecured and unguaranteed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 156.05 Td (corporate debt obligations, we transfer to third parties a portion of the credit risk of the loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 140.65 Td (underlying certain of our consolidated other risk transfer securitizations and certain of our other ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 125.25 Td (mortgage-related guarantees. The interest we pay on our SCR notes effectively reduces the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 109.85 Td (guarantee fee income we would otherwise earn on the other mortgage-related guarantees. SCR ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 94.45 Td (notes are generally similar in structure to our Single-family Guarantee segment's STACR debt notes. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 73.79 cm /I489 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 73.79 cm /I490 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 76.05 Td (Loan sales) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 123.72 76.05 Td ( ) Tj ET Q BT /F12 10.00 Tf ET q 0 0 0 rg BT 126.78 76.05 Td (- ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 132.89 76.05 Td (To reduce our interest-rate risk and credit risk exposure related to certain loans, we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 60.65 Td (engage in non-securitization related transactions, including whole loan sales. These may include ) Tj ET Q endstream endobj 129 0 obj <> endobj 130 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (60) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 741.15 Td (sales to funds to which we may also provide secured financing. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 720.49 cm /I491 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 720.49 cm /I492 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 722.75 Td (Multifamily Credit Insurance Pool \(MCIP\)) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 279.48 722.75 Td ( - Beginning in 4Q 2018, we purchased insurance ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 707.35 Td (policies, generally underwritten by a group of insurers and reinsurers, that provide first loss credit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 691.95 Td (protection for certain specified credit events. These transactions are similar in structure to the ACIS ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 676.55 Td (contracts purchased by the Single-family Guarantee segment, except the reference pool, in addition ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 661.15 Td (to loans, may include bonds underlying our other mortgage-related guarantees. When specific credit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 645.75 Td (events occur, we receive compensation from the insurance policy up to an aggregate limit based on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 630.35 Td (actual losses. We require our counterparties to partially collateralize their exposure to reduce the risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 614.95 Td (that we will not be reimbursed for our claims under the policies.) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 49.50 593.55 Td (Other Guarantee Activities) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 569.89 cm /I493 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 569.89 cm /I494 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 572.15 Td (Other mortgage-related guarantees) Tj ET Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 253.95 572.15 Td ( ) Tj ET Q BT /F12 10.00 Tf ET q 0 0 0 rg BT 257.01 572.15 Td (- ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 263.12 572.15 Td (We guarantee mortgage-related assets held by third parties ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 556.75 Td (in exchange for guarantee fee income, without securitizing those assets. For example, we provide ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 541.35 Td (guarantees on certain tax-exempt multifamily housing revenue bonds secured by low- and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 525.95 Td (moderate-income multifamily loans. The guarantee fees we receive on these transactions are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 510.55 Td (negotiated.) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 489.15 Td (Investing Activities) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 465.49 cm /I495 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 465.49 cm /I496 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 467.75 Td (Mortgage loans) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 149.81 467.75 Td ( - We hold a portfolio of multifamily mortgage loans as part of a buy-and-hold ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 452.35 Td (investment strategy. Although we continue to purchase new multifamily mortgage loans for this ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 436.95 Td (portfolio, our new purchase activity has leveled off as this buy-and-hold strategy is not part of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 421.55 Td (primary business model.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 400.89 cm /I497 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 400.89 cm /I498 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 403.15 Td (Agency mortgage-related securities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 255.77 403.15 Td ( - We generally purchase or retain a portion of the K ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 387.75 Td (Certificates and SB Certificates, depending on market conditions, and we may also buy or sell these ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 372.35 Td (securities in the secondary market.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 351.69 cm /I499 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 351.69 cm /I500 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 353.95 Td (Other investments) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 163.86 353.95 Td ( - We invest in certain non-mortgage investments, including LIHTC partnerships ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 338.55 Td (and other secured lending activities. These LIHTC partnerships invest directly in limited partnerships ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 323.15 Td (that own and operate affordable multifamily rental properties that generate federal income tax credits ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 307.75 Td (and deductible operating losses.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 287.09 cm /I501 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 287.09 cm /I502 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 289.35 Td (Non-agency mortgage-related securities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 280.42 289.35 Td ( - We may purchase a portion of the unguaranteed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 273.95 Td (mezzanine and subordinated securities related to our securitization transactions, depending on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 258.55 Td (market conditions. However, to date, we have not purchased any of the unguaranteed subordinated ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 243.15 Td (securities that are in the first loss position.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 220.35 Td (Customers) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 209.14999999999998 m 562.5 209.14999999999998 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 185.75 Td (Our multifamily loan activity is sourced through our approved lenders, who are primarily non-bank real ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 170.35 Td (estate finance companies and banks. We generally provide post-construction financing to apartment ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 154.95 Td (project operators with established performance records. The following charts show the concentration of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 139.55 Td (our 2018 multifamily new business activity by our largest sellers and loan servicing by our largest ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 124.15 Td (servicers as of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 123.71 124.15 Td (December?1, 2018) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 220.52 124.15 Td (. Any seller or servicer with a 10% or greater share is listed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 108.75 Td (separately.) Tj ET Q endstream endobj 131 0 obj <> endobj 132 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (61) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 59.55 739.15 Td (Percentage of Multifamily New Business Activity) Tj ET Q BT /F11 11.00 Tf ET BT /F11 6.60 Tf ET q 0 0 0 rg BT 270.81 743.00 Td (\(1\)) Tj ET Q /GS0 gs q 238.00 0 0 412.00 49.75 322.15 cm /I503 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 307.35 Td (\(1\) Excludes LIHTC new business activity.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 344.40 739.15 Td (Percentage of Multifamily Servicing Volume) Tj ET Q BT /F11 11.00 Tf ET BT /F11 6.60 Tf ET q 0 0 0 rg BT 535.00 743.00 Td (\(2\) ) Tj ET Q /GS0 gs q 238.50 0 0 427.00 324.00 307.15 cm /I504 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 292.35 Td (\(2\) Excludes loans underlying securitizations where we are not in a ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 337.50 281.55 Td (first loss position, primarily K Certificates and SB Certificates.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 264.75 Td (Competition) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 253.54999999999995 m 562.5 253.54999999999995 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 230.15 Td (We compete on the basis of price, service and products, including our use of certain securitization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 214.75 Td (structures. Our principal competitors in the multifamily market are Fannie Mae, FHA, commercial and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 199.35 Td (investment banks, CMBS conduits, savings institutions, and life insurance companies.) Tj ET Q endstream endobj 133 0 obj <> endobj 134 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (62) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Market Conditions) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 696.55 Td (The graphs and related discussion below present certain multifamily market indicators that can ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 681.15 Td (significantly affect the business and financial results of our Multifamily segment.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 61.10 650.75 Td (Apartment Vacancy Rates as of December 31 and ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 72.05 635.35 Td (Change in Effective Rents for the Year Ended ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 138.90 619.95 Td (December 31, ) Tj ET Q /GS0 gs q 238.50 0 0 260.00 49.50 354.95 cm /I505 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 340.15 Td (Source: REIS, Inc. ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 332.85 650.75 Td (Apartment Completions and Net Absorption for the ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 387.80 635.35 Td (Year Ended December 31,) Tj ET Q /GS0 gs q 238.50 0 0 240.00 324.00 381.35 cm /I506 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 340.15 Td (Source: REIS, Inc.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 312.89 cm /I507 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 312.89 cm /I508 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 315.15 Td (Apartment completions are an indication of the supply of rental housing. Net absorption, which is a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 299.75 Td (measurement of the rate at which available apartments are occupied, is an indication of demand for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 284.35 Td (rental housing.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 263.69 cm /I509 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 263.69 cm /I510 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 265.95 Td (While vacancy rates increased during 2018, as apartment completions outpaced net absorption, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 250.55 Td (rates remain below the long-term average of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 287.35 250.55 Td (5.4%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 313.64 250.55 Td ( from 2000 to 2018. Although we expect ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 235.15 Td (continued strong demand, it may take longer to absorb new units, resulting in renters possibly ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 219.75 Td (receiving additional concessions in 2019 compared to prior years.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 199.09 cm /I511 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 199.09 cm /I512 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 201.35 Td (Growth in effective rent \(i.e., the average rent paid by the tenant over the term of the lease, adjusted ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 185.95 Td (for concessions by the landlord and costs borne by the tenant\) for 2018 remained strong relative to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 170.55 Td (the long-term average of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 191.38 170.55 Td (3.1%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 217.67 170.55 Td ( from 2000 to 2018. The strong effective rent is primarily due to an ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 155.15 Td (increase in potential renters driven by healthy employment levels, higher wages, higher single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 139.75 Td (home prices, rising mortgage interest rates, and a growing demand for rental housing due to lifestyle ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 124.35 Td (changes and demographic trends.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 103.69 cm /I513 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 103.69 cm /I514 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 105.95 Td (Multifamily property prices continued to grow, with ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 319.38 105.95 Td (9%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 336.50 105.95 Td ( annualized growth in 2018, indicating a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 90.55 Td (healthy multifamily market, though prices were tempered by higher vacancy rates and rising interest ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 75.15 Td (rates.) Tj ET Q endstream endobj 135 0 obj <> endobj 136 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (63) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 70.50 739.15 Td (Multifamily Mortgage Debt Outstanding as of ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 138.90 725.95 Td (December 31, ) Tj ET Q /GS0 gs q 238.00 0 0 326.00 49.50 385.95 cm /I515 Do Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 380.15 Td (Source: Federal Reserve Financial Accounts of the United States of ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 369.35 Td (America. For 2018, the amount is as of September 30, 2018 \(latest ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 358.55 Td (available information\). ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 333.75 739.15 Td (Multifamily Delinquency Rates as of December 31,) Tj ET Q /GS0 gs q 238.00 0 0 368.00 324.00 357.15 cm /I516 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 562.00 362.15 Td ( ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 342.35 Td (Source: Freddie Mac, FDIC Quarterly Banking Profile, Trepp, LLC, Intex ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 331.55 Td (Solutions, Inc., and Wells Fargo Securities \(Multifamily CMBS market, ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 320.75 Td (excluding REOs\), American Council of Life Insurers \(ACLI\). For 2018, the ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 309.95 Td (amounts for FDIC insured institutions and ACLI investment bulletin are ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 299.15 Td (as of September 30, 2018 and the amount for Multifamily CMBS ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 288.35 Td (market is as of December 31, 2018 \(latest available information\).) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 270.69 cm /I517 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 270.69 cm /I518 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 272.95 Td (During 2018, the multifamily mortgage market grew because of continued strong demand for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 257.55 Td (multifamily loan products due to an elevated number of new apartment completions and strong ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 242.15 Td (multifamily market fundamentals. Multifamily market fundamentals were primarily driven by a healthy ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 226.75 Td (job market, population growth, high propensity to rent among young adults, and rising single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 211.35 Td (home prices. We expect continued growth in the multifamily mortgage market during 2019 due to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 195.95 Td (these same drivers.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 175.29 cm /I519 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 175.29 cm /I520 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 177.55 Td (While the multifamily mortgage market grew, our share of multifamily mortgage debt outstanding ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 162.15 Td (remained flat during 2018 due to ongoing competition from other market participants, which we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 146.75 Td (expect to continue in the future. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 126.09 cm /I521 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 126.09 cm /I522 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 128.35 Td (Our multifamily delinquency rates during 2018 remained low compared to other industry participants, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 112.95 Td (ending the year at 1 basis point, primarily due to our prior-approval underwriting approach and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 97.55 Td (strong multifamily market fundamentals. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 289.37 97.55 Td (Risk Management - Multifamily Mortgage ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 67.50 82.15 Td (Credit Risk - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 142.90 82.15 Td (Managing Our Portfolio, Including Loss Mitigation Activities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 483.29 82.15 Td ( for additional ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 66.75 Td (information on our delinquency rates.) Tj ET Q endstream endobj 137 0 obj <> endobj 138 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (64) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 736.29 cm /I523 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 736.29 cm /I524 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 738.55 Td (We expect the credit losses and delinquency rates for the multifamily mortgage portfolio to remain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.15 Td (low in the near term.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 190.35 697.95 Td (K Certificate Benchmark Spreads as of December 31,) Tj ET Q /GS0 gs q 445.00 0 0 315.00 83.50 368.95 cm /I525 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 49.50 354.15 Td (Source: Independent Dealers) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 327.49 cm /I526 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 327.49 cm /I527 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 329.75 Td (The valuation of our securitization pipeline and the profitability of our primary risk transfer ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 314.35 Td (securitization product, the K Certificate,) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 0 0 rg BT 262.18 314.35 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 265.24 314.35 Td (are affected by both changes in K Certificate benchmark ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 298.95 Td (spreads and deal-specific attributes, such as tranche size, risk distribution, and collateral ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 283.55 Td (characteristics \(loan term, coupon type, prepayment restrictions, and underlying property type\). ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 268.15 Td (These market spread movements and deal-specific attributes contribute to our earnings volatility, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 252.75 Td (which we manage by controlling the size of our securitization pipeline and by entering into certain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 237.35 Td (spread-related derivatives. Spread tightening generally results in fair value gains, while spread ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 221.95 Td (widening generally results in fair value losses.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 201.29 cm /I528 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 201.29 cm /I529 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 203.55 Td (K Certificate benchmark spreads are market-quoted spreads over the U.S. swap curve. The 10-year ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 188.15 Td (fixed-rate spread represents the spread for the largest guaranteed class of a typical fixed-rate K ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 172.75 Td (Certificate, while the 7-year floating-rate spread represents the spread for the largest guaranteed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 157.35 Td (class of a typical floating-rate K Certificate.) Tj ET Q endstream endobj 139 0 obj <> endobj 140 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (65) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Business Results) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 716.95 m 562.5 716.95 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 693.55 Td (The graphs, tables and related discussion below present the business results of our Multifamily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 678.15 Td (segment.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 655.35 Td (New Business Activity) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 638.15 m 562.5 638.15 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 53.65 616.95 Td (Multifamily New Business Activity for the Year Ended ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 138.90 603.75 Td (December 31,) Tj ET Q /GS0 gs q 238.50 0 0 427.00 49.50 162.75 cm /I530 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 327.70 616.95 Td (Acquisition of Units by Area Median Income \(AMI\) for ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 379.75 603.75 Td (the Year Ended December 31,) Tj ET Q /GS0 gs q 238.50 0 0 386.00 324.00 203.75 cm /I531 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 141.09 cm /I532 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 141.09 cm /I533 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 143.35 Td (The 2018 Conservatorship Scorecard annual production cap was $35.0 billion and will remain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 127.95 Td (unchanged in 2019. The production cap is subject to reassessment throughout the year by FHFA to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 112.55 Td (determine whether an increase in the cap is appropriate based on a stronger than expected overall ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 97.15 Td (market.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 76.49 cm /I534 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 76.49 cm /I535 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 78.75 Td (In 3Q 2018, we began to invest in LIHTC fund partnerships. The reported LIHTC new business ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 63.35 Td (activity reflects our total new capital commitments to these fund partnerships, of which we have ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 47.95 Td (funded ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 105.00 47.95 Td ($71 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 157.99 47.95 Td ( as of December 31, 2018. ) Tj ET Q endstream endobj 141 0 obj <> endobj 142 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (66) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 736.29 cm /I536 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 736.29 cm /I537 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 738.55 Td (Outstanding commitments, including index lock commitments, and commitments to purchase or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.15 Td (guarantee multifamily assets were ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 236.81 723.15 Td ($18.7 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 296.12 723.15 Td ( and $14.5 billion as of December 31, 2018 and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 707.75 Td (December 31, 2017, respectively. Both period-end balances include loan purchase commitments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 692.35 Td (where we have elected the fair value option.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 671.69 cm /I538 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 671.69 cm /I539 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 673.95 Td (The combination of our new business activity and outstanding commitments was higher for 2018 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 658.55 Td (than 2017 due to continued strong demand for multifamily loan products, our continued competitive ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 643.15 Td (pricing efforts, and new LIHTC investment activity. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 622.49 cm /I540 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 622.49 cm /I541 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 624.75 Td (Excluding our LIHTC new business activity, approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 354.71 624.75 Td (42%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 377.95 624.75 Td ( of our multifamily new business ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 609.35 Td (activity for 2018 counted towards the 2018 Conservatorship Scorecard production cap, while the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 593.95 Td (remaining ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 118.65 593.95 Td (58%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 141.88 593.95 Td ( was considered uncapped.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 573.29 cm /I542 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 573.29 cm /I543 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 575.55 Td (Our uncapped new business activity increased during 2018 compared to 2017 as we continued our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 560.15 Td (efforts to support borrowers in certain property types and communities that meet the criteria for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 544.75 Td (affordability and Green Advantage loans. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 524.09 cm /I544 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 524.09 cm /I545 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 526.35 Td (Approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 140.93 526.35 Td (90%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 164.16 526.35 Td ( of our 2018 new business activity compared to 88% of our 2017 new business ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 510.95 Td (activity was intended for our securitization pipeline. Combined with market demand for our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 495.55 Td (securities, our 2018 new business activity will be a driver for securitizations in the first two quarters ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 480.15 Td (of 2019.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 459.49 cm /I546 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 459.49 cm /I547 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 461.75 Td (Approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 140.93 461.75 Td (93%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 164.16 461.75 Td ( of the eligible units we financed during 2018 were affordable to households ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 446.35 Td (earning at or below 120% of the median income in their area. Furthermore, during 2018, we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 430.95 Td (continued our support of workforce housing through our continued purchases of manufactured ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 415.55 Td (housing community loans and small balance loans.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 392.75 Td (Multifamily Portfolio and Market Support) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 381.55 m 562.5 381.55 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 364.15 Td (Multifamily Market Support) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 345.75 Td (The following table summarizes our support of the multifamily market.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 327.35 Td (Table 14 - Multifamily Market Support) Tj ET Q 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 316.85 339.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 393.00 316.85 85.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 478.00 316.85 85.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 3.00 w 0 i [] 0 d 0 J 0 j 3 M 478 316.85 m 478 301.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 226.85000000000002 m 389 226.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 211.85000000000002 m 389 211.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 226.85000000000002 m 478 226.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 211.85000000000002 m 478 211.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 478 226.85000000000002 m 563 226.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 478 211.85000000000002 m 563 211.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 196.85000000000002 m 389 196.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 181.85000000000002 m 389 181.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 196.85000000000002 m 478 196.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 181.85000000000002 m 478 181.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 478 196.85000000000002 m 563 196.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 478 181.85000000000002 m 563 181.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 151.85000000000002 m 389 151.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 137.85000000000002 m 389 137.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 135.85000000000002 m 389 135.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 151.85000000000002 m 478 151.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 137.85000000000002 m 478 137.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 135.85000000000002 m 478 135.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 478 151.85000000000002 m 563 151.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 478 137.85000000000002 m 563 137.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 478 135.85000000000002 m 563 135.85000000000002 l s BT /F9 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 306.64 Td (\(In millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 397.10 307.21 Td (December 31, 2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 482.10 307.21 Td (December 31, 2017) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 291.92 Td (Guarantee portfolio) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 442.40 291.92 Td ($237,323) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 527.40 291.92 Td ($203,074) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 276.92 Td (Mortgage-related investments portfolio:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 261.92 Td (Unsecuritized mortgage loans held-for-sale) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.00 261.92 Td (23,959) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.00 261.92 Td (20,537) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 246.92 Td (Unsecuritized mortgage loans held-for-investment) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.00 246.92 Td (10,828) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.00 246.92 Td (17,702) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 231.92 Td (Mortgage-related securities) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 150.63 235.07 Td (\(1\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 455.35 231.92 Td (7,385) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 231.92 Td (7,451) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 216.92 Td (Total mortgage-related investments portfolio) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 451.00 216.92 Td (42,172) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 536.00 216.92 Td (45,690) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 201.92 Td (Other investments) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 113.12 205.07 Td (\(2\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 461.80 201.92 Td (708) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 201.92 Td (473) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 186.92 Td (Total multifamily portfolio) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 446.70 186.92 Td (280,203) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 531.70 186.92 Td (249,237) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 171.92 Td (Add: Unguaranteed securities) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 149.95 175.07 Td (\(3\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.00 171.92 Td (35,835) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.00 171.92 Td (30,890) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 156.92 Td (Less: Acquired mortgage-related securities) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 195.26 160.07 Td (\(4\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 453.15 156.92 Td (\(7,160) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 474.80 156.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 538.15 156.92 Td (\(7,109) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 559.80 156.92 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 64.50 141.92 Td (Total multifamily market support) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 442.40 141.92 Td ($308,878) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 527.40 141.92 Td ($273,018) Tj ET Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 56.85 123.55 Td (\(1\) ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 74.85 123.55 Td (Includes mortgage-related securities acquired by us from our securitizations. ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 56.85 109.75 Td (\(2\) ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 74.85 109.75 Td (Includes the carrying value of LIHTC investments and the UPB of non-mortgage loans, including financing provided to whole loan funds. ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 56.85 95.95 Td (\(3\) ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 74.85 95.95 Td (Reflects the UPB of unguaranteed securities issued as part of our securitizations and amounts related to loans sold to whole loan funds that were ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 74.85 85.15 Td (not financed by Freddie Mac. ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 56.85 74.35 Td (\(4\) ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 74.85 74.35 Td (Reflects the UPB of mortgage-related securities that were both issued as part of our securitizations and acquired by us. This UPB must be ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 74.85 63.55 Td (removed to avoid double-counting the exposure, as it is already reflected within the guarantee portfolio or unguaranteed securities.) Tj ET Q endstream endobj 143 0 obj <> endobj 144 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (67) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 736.29 cm /I548 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 736.29 cm /I549 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 738.55 Td (Our total multifamily portfolio increased during 2018, primarily due to our strong loan purchase and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.15 Td (securitization activity, which is attributable to healthy multifamily market fundamentals and a strong ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 707.75 Td (demand for certain of our securitization products. We expect continued portfolio growth in 2019 as ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 692.35 Td (purchase and securitization activities should outpace run off. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 671.69 cm /I550 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 671.69 cm /I551 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 673.95 Td (At December 31, 2018, approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 256.22 673.95 Td (74%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 279.45 673.95 Td ( of our held-for-sale loans and held-for-sale loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 658.55 Td (commitments, both of which are measured at fair value, were fixed-rate, while the remaining ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 521.06 658.55 Td (26%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 544.29 658.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 643.15 Td (were floating-rate. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 622.49 cm /I552 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 622.49 cm /I553 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 624.75 Td (We expect our guarantee portfolio to continue to grow as a result of ongoing securitizations, which ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 609.35 Td (we expect to be driven by continued strong new business activity.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 586.55 Td (Net Interest Yield and Average Balance) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 575.35 m 562.5 575.35 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 164.65 548.95 Td (Net Interest Yield Earned & Average Investment Portfolio Balance ) Tj ET Q /GS0 gs q 445.00 0 0 406.00 83.50 128.95 cm /I554 Do Q BT /F2 11.00 Tf ET endstream endobj 145 0 obj <> endobj 146 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (68) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 736.29 cm /I555 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 736.29 cm /I556 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 738.55 Td (Net interest yield increased during 2018 compared to 2017 primarily due to higher prepayment ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.15 Td (income received from interest-only securities, coupled with an increase in our interest-only security ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 707.75 Td (holdings which generally have higher yields relative to our non-interest-only securities and loans, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 692.35 Td (partially offset by higher average funding costs on our held-for-sale mortgage loans driven by higher ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 676.95 Td (interest rates. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 656.29 cm /I557 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 656.29 cm /I558 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 658.55 Td (The weighted average portfolio balance of interest-earning assets decreased during 2018 due to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 643.15 Td (run off of our held-for-investment loans.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 617.35 Td (Risk Transfer Activity) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 606.15 m 562.5 606.15 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 52.20 584.95 Td (UPB of Assets Subject to Risk Transfer Activity for the ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 113.30 571.75 Td (Year Ended December 31,) Tj ET Q /GS0 gs q 238.50 0 0 378.00 49.50 179.75 cm /I559 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 332.45 584.95 Td ( Credit Risk Transfer Activity for the Year Ended ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 409.65 571.75 Td (December 31,) Tj ET Q BT /F11 11.00 Tf ET BT /F11 6.60 Tf ET q 0 0 0 rg BT 469.68 575.60 Td (\(1\) ) Tj ET Q /GS0 gs q 238.50 0 0 405.00 324.00 152.75 cm /I560 Do Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 324.00 137.95 Td (\(1\) The amounts disclosed in the graph above represent the net credit ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 333.00 127.15 Td (risk transferred to third parties.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 99.89 cm /I561 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 99.89 cm /I562 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 102.15 Td (The UPB of our primary risk transfer securitization transactions was higher in 2018 compared to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 86.75 Td (2017, primarily due to a larger average balance in our securitization pipeline, which was driven by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 71.35 Td (strong loan purchase activity and demand for our securities during 2018. ) Tj ET Q endstream endobj 147 0 obj <> endobj 148 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (69) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 736.29 cm /I563 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 736.29 cm /I564 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 738.55 Td (In addition to transferring a large majority of the expected and stress credit risk, nearly all of our risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 723.15 Td (transfer securitization activities also shifted substantially all the interest-rate and liquidity risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 707.75 Td (associated with the underlying collateral away from Freddie Mac to third-party investors.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 687.09 cm /I565 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 687.09 cm /I566 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 689.35 Td (As of December 31, 2018, we had cumulatively transferred the large majority of credit risk on the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 673.95 Td (multifamily guarantee portfolio. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 653.29 cm /I567 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 653.29 cm /I568 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 655.55 Td (Conservatorship capital needed for credit risk was reduced by approximately 90% through CRT ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 640.15 Td (transactions on new business activity in the twelve months ended December 31, 2017; we plan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 624.75 Td (similar risk reduction transactions for this year's new business activity. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 604.09 cm /I569 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 604.09 cm /I570 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 606.35 Td (The reduction in the amount of conservatorship capital needed for credit risk on new business ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 590.95 Td (activity is calculated as conservatorship credit capital released from CRT transactions \(primarily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 575.55 Td (through K Certificates and SB Certificates\) divided by total conservatorship credit capital on new ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 560.15 Td (business activity. For more information on the CCF and the calculation of conservatorship ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 544.75 Td (capital, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 144.58 544.75 Td (Liquidity and Capital Resources -) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 334.55 544.75 Td ( Capital Resources - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 454.11 544.75 Td (Conservatorship ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 85.50 529.35 Td (Capital Framework - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 205.64 529.35 Td (Return on Conservatorship Capital) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 403.81 529.35 Td (.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 406.86 529.35 Td ( ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 508.69 cm /I571 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 508.69 cm /I572 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 510.95 Td (While our K Certificate and SB Certificate issuances continue to be our primary mechanism to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 495.55 Td (transfer multifamily mortgage credit risk and interest-rate risk, we employ other methods as well and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 480.15 Td (expect to continue to develop new risk transfer initiatives.) Tj ET Q endstream endobj 149 0 obj <> endobj 150 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (70) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 737.05 Td (Guarantee Activities) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 725.85 m 562.5 725.85 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 58.45 701.65 Td (Unearned Guarantee Fee Assets on New Guarantee ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 83.70 688.45 Td (Contracts for Year Ended December 31, ) Tj ET Q /GS0 gs q 238.00 0 0 352.00 49.75 331.45 cm /I573 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 350.85 701.65 Td (Remaining Unearned Guarantee Fees as of ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 413.40 688.45 Td (December 31, ) Tj ET Q /GS0 gs q 238.00 0 0 375.00 324.25 308.45 cm /I574 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 283.19 cm /I575 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 283.19 cm /I576 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 285.45 Td (We earn guarantee fees in exchange for providing our guarantee of some or all of the securities we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 270.05 Td (issue as part of our risk transfer securitization activities. Each time we enter into a financial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 254.65 Td (guarantee contract, we initially recognize unearned guarantee fees on our balance sheet, which ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 239.25 Td (represent the present value of future guarantee fees we expect to receive in cash. We recognize ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 223.85 Td (these fees in Segment Earnings over the remaining average guarantee term, which was eight years ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 208.45 Td (as of December 31, 2018. While we expect to collect these future fees based on historical ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 193.05 Td (performance, the actual amount collected will depend on the performance of the underlying ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 177.65 Td (collateral subject to our financial guarantee.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 156.99 cm /I577 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 156.99 cm /I578 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 68.71 159.25 Td (New unearned guarantee fee assets decreased during 2018 compared to 2017 primarily due to a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 143.85 Td (change in the product mix of our securitizations, resulting in a lower average guarantee fee rate due ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 128.45 Td (to underlying loan products that, by their nature and design, have less risk. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 107.79 cm /I579 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 107.79 cm /I580 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 110.05 Td (The balance of unearned guarantee fees increased during 2018 due to the continued growth of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 94.65 Td (multifamily guarantee business, as our risk transfer securitization volume continued to be strong, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 79.25 Td (outpacing run off.) Tj ET Q endstream endobj 151 0 obj <> endobj 152 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 407.80 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 505.97 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 508.47 764.07 Td (Multifamily) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (71) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Financial Results) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 699.55 Td (The table below presents the components of the Segment Earnings and comprehensive income for our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 684.15 Td (Multifamily segment.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 662.75 Td (Table 15 - Multifamily Segment Financial Results) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 379.00 646.25 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 240.00 631.25 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 379.00 631.25 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 473.00 631.25 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 616.25 186.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 240.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 285.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 330.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 379.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 424.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 473.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 518.00 616.25 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 3.00 w 0 i [] 0 d 0 J 0 j 3 M 285 616.25 m 285 601.25 l s 1 1 1 RG /GS0 gs 3.00 w 0 i [] 0 d 0 J 0 j 3 M 330 616.25 m 330 601.25 l s 1 1 1 RG /GS0 gs 3.00 w 0 i [] 0 d 0 J 0 j 3 M 424 616.25 m 424 601.25 l s 1 1 1 RG /GS0 gs 3.00 w 0 i [] 0 d 0 J 0 j 3 M 518 616.25 m 518 601.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 522.25 m 236 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 522.25 m 285 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 522.25 m 330 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 522.25 m 375 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 522.25 m 424 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 522.25 m 469 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 522.25 m 518 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 522.25 m 563 522.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 495.25 m 236 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 495.25 m 285 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 495.25 m 330 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 495.25 m 375 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 495.25 m 424 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 495.25 m 469 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 495.25 m 518 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 495.25 m 563 495.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 468.25 m 236 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 456.25 m 236 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 454.25 m 236 454.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 468.25 m 285 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 456.25 m 285 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 454.25 m 285 454.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 468.25 m 330 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 456.25 m 330 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 454.25 m 330 454.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 468.25 m 375 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 456.25 m 375 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 454.25 m 375 454.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 468.25 m 424 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 456.25 m 424 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 454.25 m 424 454.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 468.25 m 469 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 456.25 m 469 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 454.25 m 469 454.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 468.25 m 518 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 456.25 m 518 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 454.25 m 518 454.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 468.25 m 563 468.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 456.25 m 563 456.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 454.25 m 563 454.25 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 425.90 636.61 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 256.60 621.61 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 396.45 621.61 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 490.45 621.61 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 606.04 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 252.40 606.61 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 297.40 606.61 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 342.40 606.61 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 398.60 606.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 442.10 606.61 Td (%) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 492.60 606.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 536.10 606.61 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 592.32 Td (Net interest income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 258.00 592.32 Td ($1,096) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 303.00 592.32 Td ($1,206) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.00 592.32 Td ($1,022) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 401.35 592.32 Td (\($110) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 592.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 452.30 592.32 Td (\(9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.45 592.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 497.50 592.32 Td ($184) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 592.32 Td (18) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 592.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 579.32 Td (Guarantee fee income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 268.80 579.32 Td (817) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 313.80 579.32 Td (676) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 358.80 579.32 Td (511) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 407.80 579.32 Td (141) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.15 579.32 Td (21) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 501.80 579.32 Td (165) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 579.32 Td (32) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 566.32 Td (Benefit \(provision\) for credit losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 273.15 566.32 Td (24) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.95 566.32 Td (\(13) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 566.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.15 566.32 Td (22) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 412.15 566.32 Td (37) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.80 566.32 Td (285) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.95 566.32 Td (\(35) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 566.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.30 566.32 Td (\(159) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.45 566.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 553.32 Td (Financial instrument gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET BT /F5 5.40 Tf ET q 0 0 0 rg BT 167.29 556.47 Td (\(1\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.30 553.32 Td (\(1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 553.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.35 553.32 Td (1,504) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.35 553.32 Td (1,354) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 399.15 553.32 Td (\(1,505) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 553.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 443.65 553.32 Td (\(100) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.80 553.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 501.80 553.32 Td (150) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 553.32 Td (11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 539.32 Td (Administrative expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 266.65 539.32 Td (\(437) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 539.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 311.65 539.32 Td (\(395) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 539.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 356.65 539.32 Td (\(362) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.80 539.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 409.95 539.32 Td (\(42) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 539.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 447.95 539.32 Td (\(11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.80 539.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.95 539.32 Td (\(33) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 539.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 548.95 539.32 Td (\(9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.45 539.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 526.32 Td (Other non-interest income \(expense\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 268.80 526.32 Td (139) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 318.15 526.32 Td (96) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 358.80 526.32 Td (161) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 412.15 526.32 Td (43) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.15 526.32 Td (45) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.95 526.32 Td (\(65) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 526.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.60 526.32 Td (\(40) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.45 526.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 513.32 Td (Segment Earnings before income tax expense) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 262.35 513.32 Td (1,638) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 307.35 513.32 Td (3,074) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 352.35 513.32 Td (2,708) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 398.65 513.32 Td (\(1,436) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 420.80 513.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 513.32 Td (\(47) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 458.80 513.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 501.80 513.32 Td (366) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 546.80 513.32 Td (14) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 499.32 Td (Income tax expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 266.65 499.32 Td (\(319) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 499.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 305.15 499.32 Td (\(1,060) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 499.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 356.65 499.32 Td (\(890) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.80 499.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 407.80 499.32 Td (741) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.15 499.32 Td (70) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 499.65 499.32 Td (\(170) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 499.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.60 499.32 Td (\(19) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.45 499.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 486.32 Td (Segment Earnings, net of taxes) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 262.35 486.32 Td (1,319) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 307.35 486.32 Td (2,014) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 352.35 486.32 Td (1,818) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 405.15 486.32 Td (\(695) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 420.80 486.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 486.32 Td (\(35) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 458.80 486.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 501.80 486.32 Td (196) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 546.80 486.32 Td (11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 473.32 Td (Total other comprehensive income \(loss\), net of tax) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 270.95 473.32 Td (\(83) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 473.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.95 473.32 Td (\(77) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 473.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 356.65 473.32 Td (\(236) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.80 473.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.30 473.32 Td (\(6) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 473.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 452.30 473.32 Td (\(8) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 458.80 473.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 501.80 473.32 Td (159) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 473.32 Td (67) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 459.32 Td (Total comprehensive income \(loss\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 258.00 459.32 Td ($1,236) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 303.00 459.32 Td ($1,937) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 348.00 459.32 Td ($1,582) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 400.85 459.32 Td (\($701) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 420.80 459.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 459.32 Td (\(36) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 458.80 459.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 497.50 459.32 Td ($355) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 546.80 459.32 Td (22) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 555.45 459.32 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 438.95 Td (\(1\) ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 438.95 Td (Consists of fair value gains and losses on loan purchase commitments, mortgage loans and debt for which we have elected the fair value option, ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 428.15 Td (investment securities, and derivatives. ) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 403.75 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 377.09 cm /I581 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 377.09 cm /I582 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 379.35 Td (2018 vs. 2017) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 358.69 cm /I583 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 358.69 cm /I584 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 360.95 Td (Lower net interest income due to a decline in our weighted average portfolio balance of interest-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 345.55 Td (earning assets, partially offset by higher net interest yields on an increased balance of interest-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 330.15 Td (only securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 309.49 cm /I585 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 309.49 cm /I586 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 311.75 Td (Higher guarantee fee income due to continued growth in our multifamily guarantee portfolio, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 296.35 Td (partially offset by lower average guarantee fee rates on new guarantee business volume.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 275.69 cm /I587 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 275.69 cm /I588 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 277.95 Td (Spread widening during 2018, coupled with the effects of greater competitive pricing on new ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 262.55 Td (business activity, resulted in fair value losses on mortgage loans and commitments and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 247.15 Td (mortgage-related securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 226.49 cm /I589 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 226.49 cm /I590 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 228.75 Td (2017 vs. 2016) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 208.09 cm /I591 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 208.09 cm /I592 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 210.35 Td (Higher net interest income due to higher net interest yields, partially offset by a decline in our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 194.95 Td (weighted average portfolio balance of interest-earning assets.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 174.29 cm /I593 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 174.29 cm /I594 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 176.55 Td (Higher guarantee fee income due to continued growth in our multifamily guarantee portfolio, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 161.15 Td (partially offset by slightly lower average guarantee fee rates on new guarantee business volume.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 140.49 cm /I595 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 140.49 cm /I596 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 142.75 Td (Larger fair value gains due to larger average balances of held-for-sale commitments and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 127.35 Td (securitization pipeline loans, partially offset by less tightening of K Certificate benchmark spreads ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 111.95 Td (and the effects of competitive pricing.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 91.29 cm /I597 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 91.29 cm /I598 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 93.55 Td (Larger gains on non-agency CMBS due to the disposition of certain non-agency CMBS, coupled ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 78.15 Td (with spread tightening. ) Tj ET Q endstream endobj 153 0 obj <> endobj 154 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (72) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 733.30 Td (Capital Markets) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 705.70 Td (Business Overview) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 694.5 m 562 694.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.10 Td (The Capital Markets segment supports our primary business strategies by creating: ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 649.70 Td (A Better Freddie Mac:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 629.04 cm /I599 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 629.04 cm /I600 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 631.30 Td (Engaging in economically sensible transactions to reduce our less liquid assets; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 610.64 cm /I601 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 610.64 cm /I602 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 612.90 Td (Managing the mortgage-related investments portfolio's risk-versus-return profile based on our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 597.50 Td (internal economic capital framework, which is aligned with the Conservatorship Capital Framework;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 576.84 cm /I603 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 576.84 cm /I604 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 579.10 Td (Enhancing the liquidity of our issued securities in the secondary mortgage market to support our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 563.70 Td (business needs;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 543.04 cm /I605 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 543.04 cm /I606 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 545.30 Td (Responding to market opportunities in funding our business activities;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 524.64 cm /I607 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 524.64 cm /I608 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 526.90 Td (Managing our economic interest-rate risk through the use of derivatives and various debt ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 511.50 Td (instruments; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 490.84 cm /I609 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 490.84 cm /I610 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 493.10 Td (Attempting to align prepayment and pooling profiles for Freddie Mac TBA programs to match Fannie ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 477.70 Td (Mae's TBA characteristics.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 456.30 Td (A Better Housing Finance System:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 435.64 cm /I611 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 435.64 cm /I612 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 437.90 Td (Delivering mortgage capital markets services including our cash loan purchase program, in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 422.50 Td (conjunction with the Single-family Guarantee segment and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 401.84 cm /I613 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 401.84 cm /I614 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 404.10 Td (Implementing the Single Security initiative for Freddie Mac and Fannie Mae, which is intended to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 388.70 Td (increase the liquidity of the TBA market and to reduce the disparities in trading value between our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 373.30 Td (PCs and Fannie Mae's single-class mortgage-related securities.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 351.90 Td (The Capital Markets segment is responsible for managing the majority of our mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 336.50 Td (investments portfolio, and providing company-wide treasury and interest-rate risk management ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 321.10 Td (functions. In addition, we are responsible for managing our securitization and resecuritization activities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 305.70 Td (related to single-family loans, and supporting multifamily securitizations.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 284.30 Td (Our mortgage portfolio management activities primarily include single-family unsecuritized loans, a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 268.90 Td (diminishing portfolio of non-agency mortgage-related securities, and purchases and sales of agency ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 253.50 Td (mortgage-related securities. In addition, we actively engage in the structuring of our agency mortgage-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (related securities. Our portfolio management activities also include responsibility for maintaining the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 222.70 Td (other investments portfolio, which is primarily used for short-term liquidity management. However, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 207.30 Td (certain portions of the mortgage-related investments portfolio are not managed by us, including the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 191.90 Td (portions of the portfolio related to multifamily assets, single-family seriously delinquent loans, and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 176.50 Td (credit risk on single-family performing and reperforming loans. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 155.10 Td (We provide a company-wide treasury function, primarily managing our funding and liquidity needs on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 139.70 Td (both a short- and long-term basis. The primary activities of the treasury function include issuing, calling ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 124.30 Td (and repurchasing debt and maintaining a portfolio of non-mortgage investments. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 102.90 Td (Our interest-rate risk management function consolidates and manages the overall interest-rate risk of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 87.50 Td (the company. To reduce our exposure to changes in the cash flows of interest-rate sensitive assets and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 72.10 Td (liabilities due to interest rate changes, we actively monitor and economically hedge this risk, primarily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 56.70 Td (through the use of derivative instruments. In addition, we further reduce these interest-rate exposures ) Tj ET Q endstream endobj 155 0 obj <> endobj 156 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (73) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (through active management of our debt funding mix and through the structuring of our investments in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (mortgage-related securities.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 704.35 Td (Finally, the Capital Markets segment is responsible for management of our securitization and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 688.95 Td (resecuritization activities related to single-family loans, which are discussed in more detail in ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 503.96 688.95 Td (Our ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 673.55 Td (Business Segments - Single-Family Guarantee.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 652.15 Td (Although we manage our business on an economic basis, we have previously executed certain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 636.75 Td (transactions to reduce the probability of our having a negative net worth due to changes in interest rates ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 621.35 Td (and thus being required to draw from Treasury. In 2017, we implemented fair value hedge accounting, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 605.95 Td (which has reduced the need for these types of transactions. Also, we may forgo certain investment ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 590.55 Td (opportunities for a variety of reasons, including the limit on the size of our mortgage-related investments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 575.15 Td (portfolio or the risk that an accounting treatment may create earnings variability as well as result in a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 559.75 Td (future draw from Treasury. For additional information on the limits on the mortgage-related investments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 544.35 Td (portfolio established by the Purchase Agreement and by FHFA, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 382.08 544.35 Td (Conservatorship and Related ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 528.95 Td (Matters - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 105.53 528.95 Td (Limits on Our Mortgage-Related Investments Portfolio and Indebtedness.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 506.15 Td (Products and Activities) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 494.95 m 562 494.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 471.55 Td (Investing, Liquidity Management, and Related Activities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 450.15 Td (In our Capital Markets segment, our objectives are to make appropriate risk and capital management ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 434.75 Td (decisions, effectively execute our strategy and be responsive to market conditions. We manage the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 419.35 Td (following types of products:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 398.69 cm /I615 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 398.69 cm /I616 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 400.95 Td (Agency mortgage-related securities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 255.77 400.95 Td ( - We primarily invest in Freddie Mac mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 385.55 Td (securities, but may also invest in Fannie Mae and Ginnie Mae mortgage-related securities from time ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 370.15 Td (to time. In the future, we will also invest in UMBS with the implementation of the Single Security ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 354.75 Td (initiative. Our activities with respect to these products may include purchases and sales, dollar roll ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 339.35 Td (transactions, and structuring activities \(e.g., resecuritizing existing agency securities into REMICs ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 323.95 Td (and selling some or all of the resulting REMIC tranches\).) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 303.29 cm /I617 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 303.29 cm /I618 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 305.55 Td (Single-family unsecuritized loans) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 240.61 305.55 Td ( - We acquire single-family unsecuritized loans in two primary ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 290.15 Td (ways:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 269.49 cm /I619 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 269.49 cm /I620 Do Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 85.50 271.75 Td (Loans acquired through our cash loan purchase program that are awaiting ) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 85.50 256.35 Td (securitization) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 160.47 256.35 Td ( -) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 167.80 256.35 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 170.86 256.35 Td (We securitize most of the loans acquired through our cash loan purchase ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 240.95 Td (program into Freddie Mac mortgage-related securities, primarily PCs, which may be sold to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 225.55 Td (investors or retained in our mortgage-related investments portfolio and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 204.89 cm /I621 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 204.89 cm /I622 Do Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 85.50 207.15 Td (Seriously delinquent or modified loans that we have removed from PC pools:) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 188.75 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 188.75 Td (Certain of these loans may reperform, either on their own or through modification. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 173.35 Td (Reperforming loans are managed by both the Capital Markets and Single-family Guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 157.95 Td (segments, but are included in the Capital Markets segment's financial results. We continue to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 142.55 Td (reduce the balance of our reperforming loans through a variety of methods, including the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 127.15 Td (following:) Tj ET Q /GS0 gs q 8.91 0 0 12.00 103.50 105.60 cm /I623 Do Q /GS0 gs q 9.09 0 0 12.00 112.41 105.60 cm /I624 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.50 108.75 Td (Sales and securitization using a senior subordinate securitization structure, where we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.50 93.35 Td (guarantee the resulting senior securities. We may retain some senior securities at the time ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.50 77.95 Td (of issuance. For more information on senior subordinate securitization structures, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 121.50 62.55 Td (Our Business Segments - Single-Family Guarantee - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 421.38 62.55 Td (Business Overview - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 121.50 47.15 Td (Products and Activities - Sales of Mortgage Loans) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 406.98 47.15 Td ( and) Tj ET Q endstream endobj 157 0 obj <> endobj 158 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (74) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.91 0 0 12.00 103.50 738.00 cm /I625 Do Q /GS0 gs q 9.09 0 0 12.00 112.41 738.00 cm /I626 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.50 741.15 Td (Securitization into Freddie Mac PCs, with all of the resulting mortgage-related securities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.50 725.75 Td (initially being retained. We may resecuritize a portion of the retained mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.50 710.35 Td (securities, with some of the resulting interests being sold to third parties.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 691.95 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 691.95 Td (Loans that remain seriously delinquent are also managed by both the Capital Markets and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 676.55 Td (Single-family Guarantee segments, but are included in the Single-family Guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 661.15 Td (segment's financial results. We continue to reduce the balance of our seriously delinquent ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 645.75 Td (loans through loss mitigation and foreclosure activities, which are managed by the Single-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 630.35 Td (family Guarantee segment, and through direct loan sales, when possible.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 609.69 cm /I627 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 609.69 cm /I628 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 611.95 Td (Other investments portfolio) Tj ET Q BT /F18 11.00 Tf ET q 0 0 0 rg BT 211.33 611.95 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 214.38 611.95 Td (- We invest in other investments, including: \(i\) the Liquidity and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 596.55 Td (Contingency Operating Portfolio, primarily used for short-term liquidity management, \(ii\) cash and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 581.15 Td (other investments held by consolidated trusts, \(iii\) investments used to pledge as collateral, and \(iv\) ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 565.75 Td (secured lending activities. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 547.35 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 547.35 Td (In our secured lending activities, we provide funds to lenders for: \(i\) mortgage loans that they will ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 531.95 Td (subsequently either sell through our cash purchase program or securitize into PCs that they will ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 516.55 Td (deliver to us, \(ii\) secured term financing through revolving lines of credit collateralized by the value of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 501.15 Td (contractual mortgage servicing rights on certain mortgages we own, and \(iii\) securities purchased ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 485.75 Td (under agreements to resell as a mechanism to provide financing to investors in Freddie Mac ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 470.35 Td (securities to increase liquidity and expand the investor base for those securities. We may execute ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 454.95 Td (other types of secured lending transactions in the future.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 434.29 cm /I629 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 434.29 cm /I630 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 436.55 Td (Non-agency mortgage-related securities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 280.42 436.55 Td ( - We generally no longer purchase non-agency ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 421.15 Td (mortgage-related securities, but continue to have minimal investments in such securities that we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 405.75 Td (acquired in prior years. Our activities with respect to this product are primarily sales. In recent years, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 390.35 Td (we and FHFA reached settlements with a number of institutions to mitigate or recover losses we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 374.95 Td (recognized in prior years.) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 48.75 358.45 513.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 48.75 314.45 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 57.75 314.45 504.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 48.75 310.45 9.00 -44.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 57.75 310.45 504.00 -44.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 48.75 266.45 9.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 57.75 266.45 504.00 -4.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 48.75 314.45000000000005 m 57.75 314.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 57.75 314.45000000000005 m 561.75 314.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 48.75 262.45000000000005 m 57.75 262.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 57.75 262.45000000000005 m 561.75 262.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 48.75 238.45000000000005 m 57.75 238.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 57.75 238.45000000000005 m 561.75 238.45000000000005 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 51.25 346.31 Td (The primary impacts to Segment Earnings are:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 50.25 324.81 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.25 324.31 Td (Interest income on agency and non-agency mortgage-related securities, unsecuritized loans, and our other investments portfolio;) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 50.25 300.81 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.25 300.81 Td (Fair value gains and losses due to changes in interest rate and market spreads on our agency and non-agency mortgage-related) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.25 290.81 Td (securities and on certain securities held within our other investments portfolio that are accounted for as investment securities. These) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.25 280.81 Td (amounts are recognized in Segment Earnings or total other comprehensive income\(loss\) depending upon their classification \(trading or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.25 270.81 Td (available-for-sale, respectively\); and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 50.25 248.31 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.25 248.31 Td (Gains and losses on the sale of unsecuritized loans.) Tj ET Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 217.55 Td (We evaluate the liquidity of our mortgage-related assets based on three categories \(in order of liquidity\): ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 196.89 cm /I631 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 196.89 cm /I632 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 199.15 Td (Liquid ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 102.72 199.15 Td (- single-class and multi-class agency securities, excluding certain structured agency ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 183.75 Td (securities collateralized by non-agency mortgage-related securities;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 163.09 cm /I633 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 163.09 cm /I634 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 165.35 Td (Securitization Pipeline ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 187.44 165.35 Td (- performing single-family loans purchased for cash and primarily held for a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 149.95 Td (short period until securitized, with the resulting Freddie Mac issued securities being sold or retained; ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 134.55 Td (and ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 113.89 cm /I635 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 113.89 cm /I636 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 116.15 Td (Less Liquid ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 130.23 116.15 Td (- assets that are less liquid than both agency securities and loans in the securitization ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 100.75 Td (pipeline \(e.g., reperforming loans and non-agency mortgage-related securities\). ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 79.35 Td (We may undertake various activities to support our presence in the agency securities market or to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 63.95 Td (support the liquidity of our PCs, including their price performance relative to comparable Fannie Mae ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 48.55 Td (securities. These activities may include the purchase and sale of agency securities, dollar roll ) Tj ET Q endstream endobj 159 0 obj <> endobj 160 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (75) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (transactions, and structuring activities, such as resecuritization of existing agency securities and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (sale of some or all of the resulting securities. Depending upon market conditions, there may be ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 710.35 Td (substantial variability in any period in the total amount of securities we purchase or sell. The purchase or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 694.95 Td (sale of agency securities could, at times, adversely affect the price performance of our PCs relative to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 679.55 Td (comparable Fannie Mae securities. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 658.15 Td (We incur costs to support our presence in the agency securities market and to support the liquidity and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 642.75 Td (price performance of our PCs, including by engaging in transactions that yield less than our target rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 627.35 Td (of return. For more information, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 225.83 627.35 Td (Risk Factors? Other Risks? ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 387.22 627.35 Td (A significant decline in the ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 611.95 Td (price performance of or demand for our PCs could have an adverse effect on the volume ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 596.55 Td (and/or profitability of our new single-family guarantee business) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 414.72 596.55 Td (.) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 575.15 Td (Funding and Liquidity Management Activities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 553.75 Td (Our treasury function manages the funding needs of the company, including the Capital Markets ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 538.35 Td (segment, primarily through the issuance of unsecured other debt. The type and term of debt issued is ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 522.95 Td (based on a variety of factors and is designed to meet our ongoing cash needs and to comply with our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 507.55 Td (Liquidity Management Framework. This Framework provides a mechanism for us to sustain periods of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 492.15 Td (market illiquidity, while being able to maintain certain business activities and remain current on our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 476.75 Td (obligations. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 131.40 476.75 Td (Liquidity and Capital Resources -) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 321.36 476.75 Td ( Liquidity Management Framework) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 519.87 476.75 Td ( for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 461.35 Td (additional discussion of our Liquidity Management Framework. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 439.95 Td (We primarily use the following types of products as part of our funding and liquidity management ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 424.55 Td (activities:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 403.89 cm /I637 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 403.89 cm /I638 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 406.15 Td (Discount Notes and Reference Bills) Tj ET Q BT /F1 11.00 Tf ET BT /F1 6.60 Tf ET q 0 0 0 rg BT 253.10 410.00 Td (? Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 258.38 406.15 Td ( - We issue short-term instruments with maturities of one year ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 390.75 Td (or less. These products are generally sold on a discounted basis, paying principal only at maturity. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 375.35 Td (Reference Bills are auctioned to dealers on a regular schedule, while discount notes are issued in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 359.95 Td (response to investor demand and our cash needs. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 339.29 cm /I639 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 339.29 cm /I640 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 341.55 Td (Medium-term Notes) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 172.66 341.55 Td ( - We issue a variety of fixed-rate and variable-rate medium-term notes, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 326.15 Td (including callable and non-callable securities, and zero-coupon securities, with various maturities. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 305.49 cm /I641 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 305.49 cm /I642 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 307.75 Td (Reference Notes) Tj ET Q BT /F1 11.00 Tf ET BT /F1 6.60 Tf ET q 0 0 0 rg BT 155.36 311.60 Td (? Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 160.64 307.75 Td ( Securities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 216.03 307.75 Td ( - Reference Notes securities are non-callable fixed-rate securities, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 292.35 Td (which we currently issue with original maturities greater than or equal to two years.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 271.69 cm /I643 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 271.69 cm /I644 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 273.95 Td (Securities sold under agreements to repurchase) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 319.96 273.95 Td ( - Collateralized short-term borrowings where we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 258.55 Td (sell securities to a counterparty with an agreement to repurchase those securities at a future date. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 237.15 Td (In addition, proceeds from the issuance of STACR and SCR debt notes are used to meet the funding ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 221.75 Td (needs of the company. We consider the issuance of these debt notes when managing the treasury ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 206.35 Td (function for the company. For a description of STACR debt notes, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 393.56 206.35 Td (Our Business Segments - ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 190.95 Td (Single-Family Guarantee - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 201.06 190.95 Td (Business Overview ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 312.57 190.95 Td (-) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 317.04 190.95 Td ( Products and Activities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 453.16 190.95 Td (, and for a description ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 175.55 Td (of SCR notes, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 141.45 175.55 Td (Our Business Segments - Multifamily) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 353.33 175.55 Td ( -) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 361.48 175.55 Td ( ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 365.15 175.55 Td (Business Overview - Products and ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 160.15 Td (Activities) Tj ET Q BT /F3 11.00 Tf ET q 0 0 0 rg BT 102.48 160.15 Td (.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 138.75 Td (The average life of our assets is longer than the average life of our liabilities, which creates liquidity risk. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 123.35 Td (To manage short-term liquidity risk, we may hold a combination of cash, cash-equivalent, and non-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 107.95 Td (mortgage-related investments in our Liquidity and Contingency Operating Portfolio. These instruments ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 92.55 Td (are limited to those we expect to be liquid or mature in the short term. We also lend available cash on a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 77.15 Td (short-term basis through transactions where we purchase securities under agreements to resell. This ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 61.75 Td (portfolio is designed to allow us to meet all of our obligations in the event that we lose access to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 46.35 Td (unsecured debt markets for a period of time. ) Tj ET Q endstream endobj 161 0 obj <> endobj 162 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (76) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 741.15 Td (See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 71.50 741.15 Td (Liquidity and Capital Resources) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 253.32 741.15 Td ( for a further discussion of our funding and liquidity ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 725.75 Td (management activities. ) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 48.75 709.25 513.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 48.75 665.25 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 56.75 665.25 505.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 48.75 661.25 8.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 56.75 661.25 505.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 48.75 645.25 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 56.75 645.25 505.00 -4.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 48.75 665.25 m 56.75 665.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 56.75 665.25 m 561.75 665.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 48.75 641.25 m 56.75 641.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 56.75 641.25 m 561.75 641.25 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 51.25 697.11 Td (The primary impacts to Segment Earnings are:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.75 675.11 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 59.25 675.11 Td (Interest expense on our various funding products and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 49.75 651.11 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 59.25 651.11 Td (Gains and losses on the early termination \(call or repurchase\) of our funding products.) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 620.35 Td (Interest-Rate Risk Management Activities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 598.95 Td (We manage the economic interest-rate risk for the company and have management-approved limits for ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 583.55 Td (interest-rate risk, as measured by our models. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 299.60 583.55 Td (Risk Management - Market Risk) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 482.00 583.55 Td ( for additional ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 568.15 Td (information, including the measurement of the interest-rate sensitivity of our financial assets and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 552.75 Td (liabilities. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 531.35 Td (There is a cash flow mismatch between the company's assets and liabilities that we use to fund those ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 515.95 Td (assets. This mismatch in cash flows not only leads to liquidity risk, but also results in interest-rate risk. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 500.55 Td (We typically use interest-rate derivatives to reduce the economic risk exposure due to this mismatch. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 485.15 Td (Using our risk management practices described in the ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 317.99 485.15 Td (Risk Management - Market Risk) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 500.39 485.15 Td ( section, we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 469.75 Td (seek to reduce this impact to low levels. Additionally, assets that are likely to be sold prior to their final ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 454.35 Td (maturity may have a different debt and derivative mix than assets that we plan to hold for a longer ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 438.95 Td (period. As a result, interest-rate risk measurements for those assets may include additional assumptions ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 423.55 Td (\(such as a view on expected changes in market spreads\) concerning their price sensitivity rather than ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 408.15 Td (just a longer-term view of cash flows. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 386.75 Td (To manage our interest-rate risk, we primarily use interest rate swaps, options, swaptions, and futures. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 371.35 Td (When we use derivatives to mitigate our risk exposures, we consider a number of factors, including ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 355.95 Td (cost, exposure to counterparty credit risk, and our overall risk management strategy. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 334.55 Td (While our interest-rate risk management activities are primarily focused on reducing our economic ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 319.15 Td (interest-rate risk, during 2017, we adopted hedge accounting strategies to reduce our GAAP earnings ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 303.75 Td (variability. The adoption of hedge accounting was a business decision intended to better align earnings ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 288.35 Td (with the economics of our business, but it is not intended to change the investment and portfolio ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 272.95 Td (management decisions that our segment would otherwise make. For more information on our use of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 257.55 Td (hedge accounting see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 161.36 257.55 Td (Risk Management - ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 275.45 257.55 Td (Market Risk -) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 351.91 257.55 Td ( GAAP Earnings Variability) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 502.50 257.55 Td ( and ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 527.17 257.55 Td (Note ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 242.15 Td (9) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 56.85 242.15 Td (.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 220.75 Td (In 2018, we began to participate in transactions that support the development of the Secured Overnight ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 205.35 Td (Financing Rate \(SOFR\) as an alternative rate to LIBOR. These transactions include investment in and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 189.95 Td (issuance of SOFR indexed floating-rate debt securities and execution of SOFR indexed derivatives. For ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 174.55 Td (additional details on SOFR see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 204.14 174.55 Td (Risk Factors -) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 283.22 174.55 Td ( ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 286.89 174.55 Td (Other Risks - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 365.53 174.55 Td (The discontinuance of LIBOR ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 159.15 Td (after 2021 could negatively affect the fair value of our financial assets and liabilities, ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 143.75 Td (results of operations, and net worth. A transition to an alternative reference interest ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 128.35 Td (rate could present operational problems and result in market disruption, including ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 112.95 Td (inconsistent approaches for different financial products, as well as disagreements with ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 97.55 Td (counterparties.) Tj ET Q endstream endobj 163 0 obj <> endobj 164 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (77) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 50.25 748.50 510.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.25 704.50 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 704.50 502.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.25 700.50 8.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 700.50 502.00 -16.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.25 684.50 8.00 -4.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 58.25 684.50 502.00 -4.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50.25 704.5 m 58.25 704.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58.25 704.5 m 560.25 704.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50.25 680.5 m 58.25 680.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 58.25 680.5 m 560.25 680.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50.25 645.5 m 58.25 645.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 58.25 645.5 m 560.25 645.5 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.75 736.36 Td (The primary impacts to Segment Earnings are:) Tj ET Q BT /F5 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.25 714.36 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 714.36 Td (Fair value gains and losses on derivatives not designated in qualifying hedge relationships;) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 51.25 690.36 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 690.36 Td (Interest income/expense on derivatives; and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 51.25 666.86 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 666.86 Td (Differences between changes in the fair value of the hedged item attributable to the risk being hedged and changes in the fair value) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 60.75 656.86 Td (of the hedging instrument for derivatives designated in qualifying fair value hedge accounting relationships.) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 626.80 Td (Summary of our Primary Business Model and Its Impacts to Segment Earnings) Tj ET Q /GS0 gs q 513.00 0 0 302.90 49.50 312.95 cm /I645 Do Q BT /F13 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 293.75 Td (Securitization Activities) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 272.35 Td (We manage the company's securitization and resecuritization activities related to single-family loans. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 256.95 Td (See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 71.50 256.95 Td (Our Business Segments - Single-Family Guarantee) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 359.56 256.95 Td ( for a discussion of our single-family ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 241.55 Td (securitization and guarantee products.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 218.75 Td (Customers) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 207.54999999999995 m 562 207.54999999999995 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 184.15 Td (Our customers include banks and other depository institutions, insurance companies, money managers, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 168.75 Td (central banks, pension funds, state and local governments, REITs, brokers and dealers, and a variety of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 153.35 Td (lenders as discussed in ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 167.67 153.35 Td (Our Business Segments - Single-Family Guarantee - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 467.56 153.35 Td (Business ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 137.95 Td (Overview - Customers) Tj ET Q BT /F17 11.00 Tf ET q 0 0 0 rg BT 175.88 137.95 Td (. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 181.38 137.95 Td (Our unsecured other debt securities and structured mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 122.55 Td (securities are initially purchased by dealers and redistributed to their customers.) Tj ET Q endstream endobj 165 0 obj <> endobj 166 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 38 m 237 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 38 m 275 38 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 38 m 563 38 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 28.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 28.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 28.07 Td (78) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 739.05 Td (Competition) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 727.85 m 562 727.85 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 704.45 Td (Our competitors in the Capital Markets segment are firms that invest in loans and mortgage-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 689.05 Td (assets and issue corporate debt, including Fannie Mae, REITs, supranationals \(international institutions ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 673.65 Td (that provide development financing for member countries\), commercial and investment banks, dealers, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 658.25 Td (savings institutions, insurance companies, the Federal Farm Credit Banks, and the FHLBs.) Tj ET Q endstream endobj 167 0 obj <> endobj 168 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (79) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Market Conditions) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 699.55 Td (The following graph and related discussion presents the par swap rate curve for the most recent three ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 684.15 Td (years. Changes in the par swap rate can significantly affect the business and financial results of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 668.75 Td (Capital Markets segment.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 228.60 647.35 Td (Par Swap Rates as of December 31,) Tj ET Q /GS0 gs q 425.00 0 0 315.00 93.50 321.35 cm /I646 Do Q BT /F2 11.00 Tf ET BT /F12 8.00 Tf ET q 0 0 0 rg BT 49.50 309.55 Td ( ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 85.50 309.55 Td (Source: BlackRock) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 285.89 cm /I647 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 285.89 cm /I648 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 288.15 Td (Par swap rate changes can significantly affect the fair value of our debt, derivatives, and mortgage ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 272.75 Td (and non-mortgage-related securities. In addition, the GAAP accounting treatment for our financial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 257.35 Td (assets and liabilities, including derivatives \(i.e., some are measured at amortized cost, while others ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 241.95 Td (are measured at fair value\) creates variability in our GAAP earnings when interest rates change. We ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 226.55 Td (have elected hedge accounting for certain assets and liabilities in an effort to reduce GAAP earnings ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 211.15 Td (variability and better align GAAP results with the economics of our business.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 190.49 cm /I649 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 190.49 cm /I650 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 192.75 Td (We primarily use LIBOR-based derivatives and fixed-rate debt to hedge our interest-rate risk. The ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 177.35 Td (mortgage-related investments portfolio's exposure to interest-rate risk is calculated by our models ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 161.95 Td (that project loan and security cash flows over a variety of scenarios. For additional information on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 146.55 Td (our exposure to interest-rate risk, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 253.47 146.55 Td (Risk Management - Market Risk) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 435.87 146.55 Td (.) Tj ET Q endstream endobj 169 0 obj <> endobj 170 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (80) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 8.21 0 0 11.74 49.50 736.29 cm /I651 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 736.29 cm /I652 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 738.55 Td (2018 vs. 2017 ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 717.89 cm /I653 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 717.89 cm /I654 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 720.15 Td (The par swap curve flattened during 2018 as short-term interest rates increased more than long-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 704.75 Td (term interest rates. Long-term interest rates increased during 2018, while they remained relatively ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 689.35 Td (flat during 2017. The increases during 2018 resulted in fair value gains for our pay-fixed interest ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 673.95 Td (rate swaps, forward commitments to issue PCs, and futures, partially offset by fair value losses ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 658.55 Td (for our receive-fixed interest rate swaps, certain of our option-based derivatives, and the vast ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 643.15 Td (majority of our investments in securities. The net amount of these changes in fair value was ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 627.75 Td (mostly offset by the change in fair value of the hedged items attributable to interest-rate risk in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 612.35 Td (our hedge accounting programs.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 591.69 cm /I655 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 591.69 cm /I656 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 593.95 Td (2017 vs. 2016 ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 573.29 cm /I657 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 573.29 cm /I658 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 575.55 Td (The 2-year and 10-year swap rates increased, resulting in gains for our pay-fixed interest rate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 560.15 Td (swaps and losses for our receive-fixed interest rate swaps, certain of our option contracts, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 544.75 Td (the vast majority of our investments in securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 524.09 cm /I659 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 75.71 526.35 Td ( ) Tj ET Q q 0 0 0 rg BT 85.50 526.35 Td (3-month LIBOR increased during 2017 and during the fourth quarter of 2016, resulting in higher ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 510.95 Td (yields for our short-term interest-earning assets, higher costs for our short-term interest-bearing ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 495.55 Td (liabilities, and interest-rate related losses for certain of our shorter duration trading securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 474.89 cm /I660 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 477.15 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 477.15 Td (As the Capital Markets segment is responsible for managing interest-rate risk for the company, its ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 461.75 Td (Segment Earnings may include gains and losses on certain economic hedges on financial assets ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 446.35 Td (and liabilities primarily reported in the Single-family Guarantee segment.) Tj ET Q endstream endobj 171 0 obj <> endobj 172 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (81) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Business Results) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 699.55 Td (The graphs and related discussion below present the business results of our Capital Markets segment.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 676.75 Td (Investing Activity) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 665.55 m 562.5 665.55 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 642.15 Td (The following graphs present the Capital Markets segment's total investments portfolio and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 626.75 Td (composition of its mortgage investments portfolio by liquidity category. ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 49.50 607.55 Td ( Investments Portfolio ) Tj ET Q /GS0 gs q 238.50 0 0 272.00 49.50 324.55 cm /I661 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 324.00 607.55 Td ( Mortgage Investments Portfolio) Tj ET Q /GS0 gs q 238.50 0 0 293.00 324.00 303.55 cm /I662 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 290.89 cm /I663 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 290.89 cm /I664 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 293.15 Td (We have reduced the size of our mortgage investments portfolio to comply with the mortgage-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 277.75 Td (related investments portfolio's year-end limits. The balance of our mortgage investments portfolio ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 262.35 Td (declined 14.4% between December 31, 2017 and December 31, 2018.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 241.69 cm /I665 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 241.69 cm /I666 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 243.95 Td (The balance of our other investments portfolio decreased 30.5% primarily due to lower near-term ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 228.55 Td (cash needs for upcoming maturities and anticipated calls of other debt at the end of 2018 compared ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 213.15 Td (to the end of 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 192.49 cm /I667 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 192.49 cm /I668 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 194.75 Td (The percentage of less liquid assets relative to our total mortgage investments portfolio declined to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 179.35 Td (26.6% at December 31, 2018 from 28.4% at December 31, 2017, primarily due to repayments, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 163.95 Td (sales, and securitizations of our less liquid assets. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 143.29 cm /I669 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 143.29 cm /I670 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 145.55 Td (The overall liquidity of our mortgage investments portfolio continued to improve as our less liquid ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 130.15 Td (assets decreased at a faster pace than the overall decline of our mortgage investments portfolio.) Tj ET Q endstream endobj 173 0 obj <> endobj 174 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (82) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 737.05 Td (Reduction in Less Liquid Assets) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 725.85 m 562.5 725.85 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 57.95 702.45 Td (Securitizations of Reperforming Loans into Freddie ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 149.90 687.05 Td (Mac PCs) Tj ET Q /GS0 gs q 238.50 0 0 246.00 49.50 436.05 cm /I671 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 384.10 704.65 Td (Sales of Less Liquid Assets ) Tj ET Q /GS0 gs q 238.50 0 0 258.00 324.00 435.65 cm /I672 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 417.39 cm /I673 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 417.39 cm /I674 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 419.65 Td (Since 2013, we have focused on reducing, in an economically sensible manner, our holdings of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 404.25 Td (certain less liquid assets, including single-family reperforming loans and non-agency mortgage-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 388.85 Td (related securities. Our disposition strategies for our less liquid assets include securitizations and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 373.45 Td (sales. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 352.79 cm /I675 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 352.79 cm /I676 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 355.05 Td (During 2018, our sales of less liquid assets included ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 325.45 355.05 Td ($2.6 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 378.64 355.05 Td ( in UPB of non-agency mortgage-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 339.65 Td (related securities and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 175.55 339.65 Td ($9.5 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 228.74 339.65 Td ( of reperforming loans. Our sales of reperforming loans involved ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 324.25 Td (securitization of the loans using senior subordinate securitization structures, in which we guaranteed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 308.85 Td (the resulting senior securities. As part of these transactions, we retained certain of the guaranteed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 293.45 Td (senior securities for our mortgage-related investments portfolio.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 272.79 cm /I677 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 272.79 cm /I678 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 275.05 Td (One of our strategies related to reperforming loans is to create Freddie Mac PCs and initially retain all ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 259.65 Td (of the resulting mortgage-related securities, which may be resecuritized and sold to third parties. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 244.25 Td (During 2018, we securitized ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 206.85 244.25 Td ($1.6 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 260.04 244.25 Td ( of single-family reperforming loans through PC ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 228.85 Td (securitization. The use of this strategy has declined over time with our principal strategy now being ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 213.45 Td (the securitization of the loans using senior subordinate securitization structures.) Tj ET Q endstream endobj 175 0 obj <> endobj 176 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (83) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 737.05 Td (Net Interest Yield and Average Balances) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 725.85 m 562.5 725.85 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F11 11.00 Tf ET q 0 0 0 rg BT 164.65 699.45 Td (Net Interest Yield Earned & Average Investment Portfolio Balance ) Tj ET Q /GS0 gs q 436.00 0 0 308.00 88.00 377.45 cm /I679 Do Q BT /F2 11.00 Tf ET /GS0 gs q 8.21 0 0 11.74 49.50 364.79 cm /I680 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 364.79 cm /I681 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 67.50 367.05 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.02 367.05 Td ( - Net interest yield increased 15 basis points during 2018 compared to 2017, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 351.65 Td (primarily due to:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 330.99 cm /I682 Do Q /GS0 gs q 11.00 0 0 11.74 75.71 330.99 cm /I683 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 86.71 333.25 Td (Higher yields on our newly acquired mortgage-related assets and other investments as a result ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 317.85 Td (of increases in interest rates;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 297.19 cm /I684 Do Q /GS0 gs q 11.00 0 0 11.74 75.71 297.19 cm /I685 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 86.71 299.45 Td (Changes in our investment mix due to reductions in both our less liquid assets and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 284.05 Td (percentage of our other investments portfolio relative to our total investments portfolio; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 263.39 cm /I686 Do Q /GS0 gs q 11.00 0 0 11.74 75.71 263.39 cm /I687 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 86.71 265.65 Td (Larger benefit provided by non-interest bearing funding due to increases in both short-term ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 250.25 Td (interest rates and the percentage of non-interest bearing funding relative to our total liabilities. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 229.59 cm /I688 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 229.59 cm /I689 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 67.50 231.85 Td (2017 vs. 2016) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.02 231.85 Td ( - Net interest yield remained relatively flat.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 208.19 cm /I690 Do Q /GS0 gs q 11.00 0 0 11.74 57.71 208.19 cm /I691 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 68.71 210.45 Td (Net interest yield for the Capital Markets segment is not affected by our hedge accounting programs ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 195.05 Td (due to reclassifications made for Segment Earnings. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 348.53 195.05 Td (Note 13) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 393.61 195.05 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 396.67 195.05 Td (for more information.) Tj ET Q endstream endobj 177 0 obj <> endobj 178 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (84) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 734.15 Td (Financial Results) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 722.95 m 562.5 722.95 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 699.55 Td (The table below presents the components of the Segment Earnings and comprehensive income for our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 684.15 Td (Capital Markets segment. ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 662.75 Td (Table 16 - Capital Markets Segment Financial Results) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 379.00 646.25 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 240.00 631.25 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 379.00 631.25 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 473.00 631.25 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 616.25 186.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 240.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 285.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 330.00 616.25 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 379.00 616.25 45.00 -15.00 re f 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0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 471.25 m 285 471.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 459.25 m 285 459.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 457.25 m 285 457.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 471.25 m 330 471.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 459.25 m 330 459.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 457.25 m 330 457.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 471.25 m 375 471.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 459.25 m 375 459.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 457.25 m 375 457.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 471.25 m 424 471.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 459.25 m 424 459.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 457.25 m 424 457.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 471.25 m 469 471.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 459.25 m 469 459.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 457.25 m 469 457.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 471.25 m 518 471.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 459.25 m 518 459.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 473 457.25 m 518 457.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 471.25 m 563 471.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 459.25 m 563 459.25 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 518 457.25 m 563 457.25 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 425.90 636.61 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 256.60 621.61 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 396.45 621.61 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 490.45 621.61 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 606.04 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 252.40 606.61 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 297.40 606.61 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 342.40 606.61 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 398.60 606.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 442.10 606.61 Td (%) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 492.60 606.61 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 536.10 606.61 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 592.32 Td (Net interest income) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 258.00 592.32 Td ($3,217) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 303.00 592.32 Td ($3,279) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 348.00 592.32 Td ($3,736) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 405.65 592.32 Td (\($62) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 592.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 452.30 592.32 Td (\(2) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.45 592.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 495.35 592.32 Td (\($457) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 592.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 542.65 592.32 Td (\(12) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 553.50 592.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 579.32 Td (Investment securities gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 266.65 579.32 Td (\(102) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 579.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.35 579.32 Td (1,048) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 358.80 579.32 Td (165) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 399.15 579.32 Td (\(1,150) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 579.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 443.65 579.32 Td (\(110) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.45 579.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 501.80 579.32 Td (883) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.50 579.32 Td (535) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 579.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 566.32 Td (Debt gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 268.80 566.32 Td (531) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 313.80 566.32 Td (437) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.15 566.32 Td (77) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 412.15 566.32 Td (94) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.15 566.32 Td (22) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 461.65 566.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 501.80 566.32 Td (360) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.50 566.32 Td (468) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 566.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 553.32 Td (Derivative gains \(losses\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.35 553.32 Td (1,314) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 311.65 553.32 Td (\(587) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 553.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 352.35 553.32 Td (1,151) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 401.35 553.32 Td (1,901) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.80 553.32 Td (324) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 461.65 553.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 493.15 553.32 Td (\(1,738) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 553.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 538.35 553.32 Td (\(151) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 553.50 553.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 540.32 Td (Other non-interest income \(expense\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 268.80 540.32 Td (389) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.35 540.32 Td (5,706) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 358.80 540.32 Td (500) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 399.15 540.32 Td (\(5,317) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 540.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 447.95 540.32 Td (\(93) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.45 540.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 495.35 540.32 Td (5,206) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 534.05 540.32 Td (1,041) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 540.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 527.32 Td (Administrative expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 266.65 527.32 Td (\(365) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 527.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 311.65 527.32 Td (\(330) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 527.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 356.65 527.32 Td (\(320) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.80 527.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 409.95 527.32 Td (\(35) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 527.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 447.95 527.32 Td (\(11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.45 527.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.95 527.32 Td (\(10) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 527.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 547.00 527.32 Td (\(3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 553.50 527.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 514.32 Td (Segment Earnings before income tax expense) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 262.35 514.32 Td (4,984) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 307.35 514.32 Td (9,553) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 352.35 514.32 Td (5,309) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 398.65 514.32 Td (\(4,569) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 420.80 514.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 514.32 Td (\(48) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 458.80 514.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 495.35 514.32 Td (4,244) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 544.85 514.32 Td (80) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 555.45 514.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 501.32 Td (Income tax expense) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 266.65 501.32 Td (\(976) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 501.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 305.15 501.32 Td (\(3,296) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 501.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 350.15 501.32 Td (\(1,749) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.80 501.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 401.35 501.32 Td (2,320) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 450.15 501.32 Td (70) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 461.65 501.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 493.15 501.32 Td (\(1,547) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.80 501.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 542.65 501.32 Td (\(88) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 553.50 501.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 488.32 Td (Segment Earnings, net of taxes) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 262.35 488.32 Td (4,008) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 307.35 488.32 Td (6,257) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 352.35 488.32 Td (3,560) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 398.65 488.32 Td (\(2,249) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 420.80 488.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 488.32 Td (\(36) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 458.80 488.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 495.35 488.32 Td (2,697) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 544.85 488.32 Td (76) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 555.45 488.32 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 475.32 Td (Total other comprehensive income \(loss\), net of tax) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 266.65 475.32 Td (\(527) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.80 475.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.95 475.32 Td (\(30) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.80 475.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 356.65 475.32 Td (\(452) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.80 475.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 405.65 475.32 Td (\(497) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 475.32 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 437.15 475.32 Td (\(1,657) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 459.45 475.32 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 501.80 475.32 Td (422) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 544.85 475.32 Td (93) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 475.32 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 462.32 Td (Total comprehensive income \(loss\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 258.00 462.32 Td ($3,481) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 303.00 462.32 Td ($6,227) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 348.00 462.32 Td ($3,108) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 394.35 462.32 Td (\($2,746) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 420.80 462.32 Td (\)) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 447.45 462.32 Td (\(44) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 458.80 462.32 Td (\)%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 491.00 462.32 Td ($3,119) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 540.50 462.32 Td (100) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 555.45 462.32 Td (%) Tj ET Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 437.35 Td (The portion of total comprehensive income \(loss\) driven by interest rate-related and market spread-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 421.95 Td (related fair value changes, after-tax, is presented in the table below. These amounts affect various line ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 406.55 Td (items in the table above, including investment securities gains \(losses\), debt gains \(losses\), derivative ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 391.15 Td (gains \(losses\), income tax expense, and total other comprehensive income \(loss\), net of tax.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 369.75 Td (Table 17 - Capital Markets Segment Interest Rate-Related and Market Spread-Related Fair Value ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 354.35 Td (Changes, Net of Tax) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 378.00 337.85 184.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 239.00 322.85 135.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 378.00 322.85 90.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 472.00 322.85 90.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 49.00 307.85 186.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 239.00 307.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 284.00 307.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 329.00 307.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 378.00 307.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 423.00 307.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 472.00 307.85 45.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 517.00 307.85 45.00 -15.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 284 307.85 m 284 292.85 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 329 307.85 m 329 292.85 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 423 307.85 m 423 292.85 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 517 307.85 m 517 292.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 49 262.85 m 235 262.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 239 262.85 m 284 262.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 284 262.85 m 329 262.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 262.85 m 374 262.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 378 262.85 m 423 262.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 423 262.85 m 468 262.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 472 262.85 m 517 262.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 517 262.85 m 562 262.85 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 424.90 328.21 Td (Year Over Year Change) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 255.60 313.21 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 395.45 313.21 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 489.45 313.21 Td (2017 vs. 2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 51.50 297.64 Td (\(Dollars in millions\)) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 251.40 298.21 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 296.40 298.21 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 341.40 298.21 Td (2016) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 397.60 298.21 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 441.10 298.21 Td (%) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 491.60 298.21 Td ($) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 535.10 298.21 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 51.50 282.92 Td (Interest rate-related) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 264.00 282.92 Td (\($0.3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 281.30 282.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 309.00 282.92 Td (\($0.3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 326.30 282.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 356.15 282.92 Td ($0.2) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 406.95 282.92 Td ($? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 451.60 282.92 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 282.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 497.00 282.92 Td (\($0.5) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 514.30 282.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 537.35 282.92 Td (\(250) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 552.50 282.92 Td (\)%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 51.50 267.92 Td (Market spread-related) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 270.50 267.92 Td (0.4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 315.50 267.92 Td (0.8) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 360.50 267.92 Td (0.3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 407.30 267.92 Td (\(0.4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.30 267.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 449.80 267.92 Td (\(50) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 460.65 267.92 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 503.50 267.92 Td (0.5) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.50 267.92 Td (167) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 241.95 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 221.29 cm /I692 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 221.29 cm /I693 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 223.55 Td (2018 vs. 2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.23 223.55 Td ( ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 202.89 cm /I694 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 202.89 cm /I695 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 205.15 Td (Lower net interest income during 2018 primarily due to the continued reduction in the balance of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 189.75 Td (our mortgage-related investments portfolio, partially offset by:) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 171.35 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 171.35 Td (Higher yields on our newly acquired mortgage-related assets and other investments as a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 155.95 Td (result of increases in interest rates;) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 137.55 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 137.55 Td (Changes in our investment mix due to reductions in both our less liquid assets and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 122.15 Td (percentage of our other investments portfolio relative to our total investments portfolio; and) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 103.75 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 103.75 Td (Larger benefit provided by non-interest bearing funding due to increases in both short-term ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 88.35 Td (interest rates and the percentage of non-interest bearing funding relative to our total liabilities. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 67.69 cm /I696 Do Q /GS0 gs q 11.00 0 0 11.74 75.71 67.69 cm /I697 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 86.71 69.95 Td (Relatively flat interest rate-related fair value losses during 2018.) Tj ET Q endstream endobj 179 0 obj <> endobj 180 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 564 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 386.05 764.07 Td (Our Business Segments |) Tj ET Q BT /F12 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 484.22 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 486.72 764.07 Td (Capital Markets) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (85) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 739.15 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 739.15 Td (Long-term interest rates increased during the 2018 periods, while rates remained relatively ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 723.75 Td (flat during 2017, resulting in higher fair value losses for the vast majority of our investments in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 708.35 Td (securities \(some of which are recorded in other comprehensive income\), our receive-fixed ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 692.95 Td (interest rate swaps, and certain of our option-based derivatives, offset by higher fair value ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 677.55 Td (gains for our pay-fixed interest rate swaps, forward commitments to issue PCs, and futures.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 659.15 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 659.15 Td (The net amount of these changes in fair value was mostly offset by the change in fair value of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 643.75 Td (the hedged items attributable to interest-rate risk in our hedge accounting programs.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 625.35 Td (?) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 625.35 Td (The remaining amount of interest rate-related fair value changes was primarily attributable to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 609.95 Td (the implied net cost on instruments such as swaptions, futures, and forward purchase and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 594.55 Td (sale commitments from our hedging and interest-rate risk management activities. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 526.61 594.55 Td (Risk ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 103.50 579.15 Td (Management - Market Risk) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 257.58 579.15 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 260.63 579.15 Td (for additional information on the effect of market-related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 103.50 563.75 Td (items on our comprehensive income. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 543.09 cm /I698 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 543.09 cm /I699 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 545.35 Td (Lower spread-related gains during 2018 driven by lower non-agency mortgage-related securities ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 529.95 Td (balances. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 509.29 cm /I700 Do Q /GS0 gs q 11.00 0 0 11.74 75.71 509.29 cm /I701 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 86.71 511.55 Td (Recognition of $4.5 billion in proceeds received during 2017 from the RBS settlement compared ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 496.15 Td (to a $0.3 billion gain recognized from the Nomura judgment during 2018 related to certain of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 480.75 Td (non-agency mortgage related securities. For more information, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 415.78 480.75 Td (Note 14) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 460.86 480.75 Td (.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 460.09 cm /I702 Do Q /GS0 gs q 11.00 0 0 11.74 75.71 460.09 cm /I703 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 86.71 462.35 Td (Lower amortization of debt securities of consolidated trusts during 2018 driven by a decrease in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 446.95 Td (prepayments as a result of higher interest rates.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 426.29 cm /I704 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 426.29 cm /I705 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 428.55 Td (2017 vs. 2016) Tj ET Q BT /F12 11.00 Tf ET q 0 0 0 rg BT 137.23 428.55 Td ( ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 407.89 cm /I706 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 75.71 410.15 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 85.50 410.15 Td (The continued reduction in the balance of our mortgage-related investments portfolio resulted in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 394.75 Td (a decrease in net interest income. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 374.09 cm /I707 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 75.71 376.35 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 85.50 376.35 Td (Interest rate-related fair value changes during 2017. Losses increased, driven by lower levels of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 360.95 Td (volatility during 2017, resulting in larger losses in our options portfolio, coupled with lower fair ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 345.55 Td (value gains in our pay-fixed interest rate swaps as long-term interest rates increased less. This ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 330.15 Td (was partially offset by reduced fair value losses in our receive-fixed interest rate swaps and the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 314.75 Td (majority of our investments in securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 294.09 cm /I708 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 75.71 296.35 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 85.50 296.35 Td (Higher spread-related fair value gains driven by market spread tightening during 2017 on our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 280.95 Td (non-agency mortgage-related securities.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 260.29 cm /I709 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 75.71 262.55 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 85.50 262.55 Td (Higher gains on the extinguishment of debt as long-term interest rates increased between the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 247.15 Td (time of issuance and repurchase during 2017.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 226.49 cm /I710 Do Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 75.71 228.75 Td ( ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 85.50 228.75 Td (Proceeds of $4.5 billion received from the RBS settlement during 2017 related to certain of our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 213.35 Td (non-agency mortgage-related securities. For more information on this settlement, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 507.68 213.35 Td (Note 14) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 552.76 213.35 Td (.) Tj ET Q endstream endobj 181 0 obj <> endobj 182 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 764 m 250 764 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 764 m 563 764 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 769.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 416.95 769.07 Td (Our Business Segments) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 510.62 769.07 Td ( | ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 517.96 769.07 Td (All Other) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (86) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 731.30 Td (All Other) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 703.70 Td (Comprehensive Income) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 692.5 m 562.5 692.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 669.10 Td (The table below shows our comprehensive income \(loss\) for the All Other category.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 647.70 Td (Table 18 - All Other Category Comprehensive Income) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 355.00 631.20 208.00 -13.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 201.00 618.20 150.00 -13.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 355.00 618.20 102.00 -13.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 461.00 618.20 102.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 605.20 147.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 201.00 605.20 50.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 251.00 605.20 50.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 301.00 605.20 50.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 355.00 605.20 51.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 406.00 605.20 51.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 461.00 605.20 51.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 512.00 605.20 51.00 -13.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 251 605.2 m 251 592.2 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 301 605.2 m 301 592.2 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 406 605.2 m 406 592.2 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 512 605.2 m 512 592.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 571.2 m 197 571.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 201 571.2 m 251 571.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 251 571.2 m 301 571.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 301 571.2 m 351 571.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 355 571.2 m 406 571.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406 571.2 m 457 571.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 461 571.2 m 512 571.2 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512 571.2 m 563 571.2 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 413.90 621.56 Td (Year Over Year Change) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 230.15 609.27 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 378.45 608.56 Td (2018 vs. 2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 484.45 608.56 Td (2017 vs. 2016) Tj ET Q BT /F5 8.00 Tf ET q 1 1 1 rg BT 52.50 596.99 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 216.85 596.27 Td (2018) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 266.85 596.27 Td (2017) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 316.85 596.27 Td (2016) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 377.80 596.27 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 427.45 596.27 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 483.80 596.27 Td ($) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 533.45 596.27 Td (%) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 576.27 Td (Comprehensive income \(loss\) - All Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 234.95 576.27 Td ($? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 272.35 576.27 Td (\($5,405) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 298.30 576.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 334.95 576.27 Td ($? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 379.50 576.27 Td ($5,405) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 421.10 576.27 Td (100%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 483.35 576.27 Td (\($5,405) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 509.30 576.27 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 530.95 576.27 Td (N/A) Tj ET Q BT /F2 11.00 Tf ET BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 547.30 Td (Key Drivers:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 523.64 cm /I711 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 523.64 cm /I712 Do Q BT /F15 11.00 Tf ET q 0 0 0 rg BT 67.50 525.90 Td (2018 vs. 2017 and 2017 vs. 2016) Tj ET Q BT /F12 11.00 Tf ET q 0 0 0 rg BT 232.42 525.90 Td ( ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 235.47 525.90 Td (- Changes in comprehensive income \(loss\) driven by:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 67.50 505.24 cm /I713 Do Q /GS0 gs q 9.79 0 0 11.74 75.71 505.24 cm /I714 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 507.50 Td (Higher income tax expense in 2017 due to the revaluation of our net deferred tax asset driven by ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 492.10 Td (the Tax Cuts and Jobs Act, which reduced the statutory corporate income tax rate from 35% to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 85.50 476.70 Td (21% for tax years after 2017. For more information on the statutory tax rate change, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 519.79 476.70 Td (Note ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 85.50 461.30 Td (12) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 100.20 461.30 Td (.) Tj ET Q endstream endobj 183 0 obj <> endobj 184 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 562 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 437.75 764.07 Td (Risk Management ) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 510.26 764.07 Td (| ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 515.10 764.07 Td (Overview) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (87) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F7 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 731.30 Td (RISK MANAGEMENT) Tj ET Q BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 698.90 Td (Overview ) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 49.50 677.50 Td (We take risks as an integral part of our business activities. Risk is the possibility that events will ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 662.10 Td (adversely affect the achievement of our mission, strategy, and business objectives. Risk can manifest ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 646.70 Td (itself in many ways. We seek to take risks in a safe and sound, well-controlled manner to earn ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 631.30 Td (acceptable risk-adjusted returns on both a corporate-wide and, where applicable, transaction basis. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 609.90 Td (We utilize a risk taxonomy to define and classify risks that we face in operating our business. These risks ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 594.50 Td (have the potential to adversely affect our current or projected financial results and condition and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 579.10 Td (operational resilience. The risk taxonomy is also the basis for aligning corporate risk policies and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 563.70 Td (standards. The key types of risks are:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 540.04 cm /I715 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 540.04 cm /I716 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 542.30 Td (Credit risk; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 521.64 cm /I717 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 521.64 cm /I718 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 523.90 Td (Operational Risk;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 503.24 cm /I719 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 503.24 cm /I720 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 505.50 Td (Market Risk;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 484.84 cm /I721 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 484.84 cm /I722 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 487.10 Td (Liquidity Risk;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 466.44 cm /I723 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 466.44 cm /I724 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 468.70 Td (Strategic Risk; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 448.04 cm /I725 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 448.04 cm /I726 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 450.30 Td (Reputation Risk.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 428.90 Td (Strategic and reputation risks are factored into business decisions and are a shared responsibility of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 413.50 Td (senior management. For more discussion of these and other risks facing our business, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 496.22 413.50 Td (Risk ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 398.10 Td (Factors) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 92.10 398.10 Td (. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 120.22 398.10 Td (Liquidity and Capital Resources) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 302.04 398.10 Td ( for a discussion of liquidity risk. ) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 370.50 Td (Enterprise Risk Framework) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 359.3 m 562.5 359.3 l s BT /F2 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 335.90 Td (The enterprise risk framework establishes the foundation for how we manage risk to achieve our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 320.50 Td (objectives and strategies. The enterprise risk framework: ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 296.84 cm /I727 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 296.84 cm /I728 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 299.10 Td (Serves as the basis for performing risk functions across a range of stress scenarios; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 278.44 cm /I729 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 280.70 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 280.70 Td (Allows the company to manage risk in a consistent manner; ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 260.04 cm /I730 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 262.30 Td ( ) Tj ET Q q 0 0 0 rg BT 67.50 262.30 Td (Defines risk roles, accountabilities, and authority across the three lines of defense; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 241.64 cm /I731 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 241.64 cm /I732 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 243.90 Td (Promotes risk ownership and provides for independent risk assessment and transparency in risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 228.50 Td (management decisions and execution. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 207.10 Td (The framework includes the following components: ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 183.44 cm /I733 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 183.44 cm /I734 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 185.70 Td (Three Lines of Defense) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 188.41 185.70 Td ( - The business lines, independent risk management, and internal audit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 170.30 Td (make up the three lines of defense. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 149.64 cm /I735 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 57.71 151.90 Td ( ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 151.90 Td (Risk Culture) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 131.97 151.90 Td ( - The board and senior management support an effective risk culture by setting the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 136.50 Td ("tone at the top" and by encouraging proactive risk discussions. A strong risk culture reinforces the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 121.10 Td (importance of our risk management strategy, and promotes collaboration and transparency among ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 105.70 Td (the three lines of defense and a supportive environment for all employees where business is ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 90.30 Td (conducted in a lawful and ethical manner. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 69.64 cm /I736 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 69.64 cm /I737 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 71.90 Td (Risk Governance) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 156.93 71.90 Td ( - Risk governance comprises the risk responsibilities of the three lines of defense, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 56.50 Td (the risk committee structure at the division, enterprise, and Board levels, and reporting and ) Tj ET Q endstream endobj 185 0 obj <> endobj 186 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 562 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 437.75 764.07 Td (Risk Management ) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 510.26 764.07 Td (| ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 515.10 764.07 Td (Overview) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (88) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 739.15 Td (escalation requirements. ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 718.49 cm /I738 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 718.49 cm /I739 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 720.75 Td (Risk Appetite) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 137.69 720.75 Td ( - The risk appetite is the aggregate level and types of risk that the Board and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 705.35 Td (management are willing to assume to achieve the company's strategic objectives. The risk appetite ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 689.95 Td (is integrated and aligned with the strategic plans for the company and each business segment.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 669.29 cm /I740 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 669.29 cm /I741 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 671.55 Td (Risk Authority) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 141.43 671.55 Td ( - The Board delegates authority to the CEO, and the CEO delegates authority to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 656.15 Td (members of executive management.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 635.49 cm /I742 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 635.49 cm /I743 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 637.75 Td (Corporate Risk Policies and Standards) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 269.88 637.75 Td ( - Corporate risk policies provide clarity on roles and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 622.35 Td (responsibilities, establish risk approval requirements, and define escalation and reporting ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 606.95 Td (requirements. Corporate risk standards provide the minimum requirements to implement corporate ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 591.55 Td (risk policies and may also establish risk approval requirements.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 570.89 cm /I744 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 570.89 cm /I745 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 573.15 Td (Capital Framework) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 166.54 573.15 Td ( - We use both FHFA's CCF and internal capital methodologies to measure risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 557.75 Td (for making economically effective decisions. See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 309.73 557.75 Td (Liquidity and Capital Resources - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 503.38 557.75 Td (Capital ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 67.50 542.35 Td (Resources - Conservatorship Capital Framework.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 521.69 cm /I746 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 521.69 cm /I747 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 523.95 Td (Risk-Adjusted Return) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 180.09 523.95 Td ( - We use risk-adjusted return, based on the CCF, to measure returns of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 508.55 Td (business lines, transactions, and initiatives. We seek to achieve acceptable risk-adjusted returns ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 493.15 Td (consistent with pre-set targets.) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 472.49 cm /I748 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 472.49 cm /I749 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 474.75 Td (Risk Profile) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 127.30 474.75 Td ( - The risk profile is a point-in-time assessment of inherent and/or residual risk for a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 459.35 Td (specific risk type, measured at a divisional or enterprise level for the relevant risk types. The ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 443.95 Td (assessment incorporates results from stress testing or scenario analysis, judgmental evaluation of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 428.55 Td (external and internal factors, effectiveness of controls, or any development that may affect ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 413.15 Td (performance relative to the strategy and business objectives.) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 385.55 Td (Enterprise Risk Governance Structure) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 374.35 m 562.5 374.35 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 350.95 Td (We manage risk using a three-lines-of-defense risk management model and governance structure that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 335.55 Td (includes enterprise-wide oversight by the Board and its committees, the CERO, the CCO, and our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 320.15 Td (corporate ERC.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 298.75 Td (The information and diagram below present the responsibilities associated with our three-lines-of-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 283.35 Td (defense risk management model and our risk governance structure. The risk governance structure also ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 267.95 Td (includes management risk committees for each business line to actively discuss and monitor business-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 252.55 Td (specific risk profiles, risk decisions, and risk appetite metrics, limits and thresholds, and risk type ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 237.15 Td (committees to oversee specific risk types that are present in and span across business lines.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 215.75 Td (For more information on the role of the Board and its committees, see ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 394.22 215.75 Td (Directors, Corporate ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 49.50 200.35 Td (Governance, and Executive Officers - Corporate Governance - ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 406.84 200.35 Td (Board and Committee ) Tj ET Q BT /F10 11.00 Tf ET q 0 0 0 rg BT 49.50 184.95 Td (Information) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 115.91 184.95 Td (.) Tj ET Q endstream endobj 187 0 obj <> endobj 188 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 562 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 437.75 764.07 Td (Risk Management ) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 510.26 764.07 Td (| ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 515.10 764.07 Td (Overview) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (89) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL /GS0 gs q 513.00 0 0 663.85 49.50 83.18 cm /I750 Do Q BT /F2 11.00 Tf ET endstream endobj 189 0 obj <> endobj 190 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 561 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 428.10 764.07 Td (Risk Management) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 498.11 764.07 Td ( | ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 505.45 764.07 Td (Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (90) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F6 22.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 49.50 731.30 Td (Credit Risk) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 703.70 Td (Overview) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 692.5 m 562.5 692.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 669.10 Td (Credit risk is the risk associated with the inability or failure of a borrower, issuer, or counterparty to meet ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 653.70 Td (its financial and/or contractual obligations. We are exposed to both mortgage credit risk and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 638.30 Td (counterparty credit risk. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 616.90 Td (Mortgage credit risk is the risk associated with the inability or failure of a borrower to meet its financial ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 601.50 Td (and/or contractual obligations. We are exposed to two types of mortgage credit risk:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 577.84 cm /I751 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 577.84 cm /I752 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 580.10 Td (Single-family mortgage credit risk) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 245.38 580.10 Td (, through our ownership or guarantee of loans in the single-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 564.70 Td (family credit guarantee portfolio and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 544.04 cm /I753 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 544.04 cm /I754 Do Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 67.50 546.30 Td (Multifamily mortgage credit risk) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 234.58 546.30 Td (, through our ownership or guarantee of loans in the multifamily ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 530.90 Td (mortgage portfolio.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 509.50 Td (Counterparty credit risk is the risk associated with the inability or failure of a counterparty to meet its ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 494.10 Td (contractual obligations. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 472.70 Td (In the sections below, we provide a general discussion of our enterprise risk framework and current risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 457.30 Td (environment for mortgage credit risk, and for counterparty credit risk.) Tj ET Q BT /F6 18.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg BT 49.50 429.70 Td (Single-Family Mortgage Credit Risk) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 418.5 m 562.5 418.5 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 395.10 Td (We manage our exposure to single-family mortgage credit risk, which is a type of consumer credit risk, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 379.70 Td (using the following principal strategies:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 359.04 cm /I755 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 359.04 cm /I756 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 361.30 Td (Maintaining policies and procedures for new business activity, including prudent underwriting ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 345.90 Td (standards;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 325.24 cm /I757 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 325.24 cm /I758 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 327.50 Td (Transferring credit risk of the single-family credit guarantee portfolio to investors in new and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 312.10 Td (innovative ways;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 291.44 cm /I759 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 291.44 cm /I760 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 293.70 Td (Monitoring loan performance and characteristics of the single-family credit guarantee portfolio and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 278.30 Td (individual sellers and servicers;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 257.64 cm /I761 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 257.64 cm /I762 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 259.90 Td (Engaging in loss mitigation activities; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 239.24 cm /I763 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 239.24 cm /I764 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 241.50 Td (Managing foreclosure and REO activities.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 215.90 Td (Maintaining Policies and Procedures for New Business Activity, Including Prudent ) Tj ET Q BT /F6 14.00 Tf ET q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 196.30 Td (Underwriting Standards ) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 182.89999999999998 m 562.5 182.89999999999998 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 159.50 Td (We use a delegated underwriting process in connection with our acquisition of single-family loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 144.10 Td (whereby we set eligibility and underwriting standards, and sellers represent and warrant to us that loans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 128.70 Td (they sell to us meet these standards. Our eligibility and underwriting standards evaluate loans based on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 113.30 Td (a number of characteristics.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 91.90 Td (Limits are established on the purchase of loans with certain higher risk characteristics. These limits are ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 76.50 Td (designed to balance our credit risk exposure while supporting affordable housing in a responsible ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 61.10 Td (manner. Our purchase guidelines generally provide for a maximum original LTV ratio of 95%, a maximum ) Tj ET Q endstream endobj 191 0 obj <> endobj 192 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (91) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (LTV ratio of 80% for cash-out refinance loans, and no maximum LTV ratio for fixed-rate HARP loans and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (fixed-rate Enhanced Relief Refinance program loans. We purchase certain loans with LTV ratios up to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 708.35 Td (97% under an initiative designed to serve a targeted segment of creditworthy borrowers meeting certain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 692.95 Td (Area Median Income requirements. In 2Q 2018, we launched the HomeOne) Tj ET Q BT /F2 11.00 Tf ET BT /F2 6.60 Tf ET q 0 0 0 rg BT 418.36 696.80 Td (SM) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 428.38 692.95 Td ( offering which expanded ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 677.55 Td (the 97% program to a broader segment of creditworthy first-time home buyers. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 656.15 Td (The majority of our purchase volume is evaluated using either Freddie Mac's proprietary underwriting ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 640.75 Td (software Loan Product Advisor) Tj ET Q BT /F19 11.00 Tf ET BT /F19 7.15 Tf ET q 0 0 0 rg BT 200.85 646.00 Td (? Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 206.42 640.75 Td (, Fannie Mae's comparable software Desktop Underwriter \(DU\) or the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 625.35 Td (seller's proprietary automated underwriting system. The performance of all loans is monitored to assess ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 609.95 Td (compliance with our risk appetite. Fannie Mae announced changes to its DU in July 2017, which led to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 594.55 Td (an increase in eligibility for purchase of new loans with DTI ratios between 45% and 50% \(high DTI\). ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 579.15 Td (These loans have minimal impact on our single-family credit guarantee portfolio, but we are monitoring ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 563.75 Td (the overall credit quality and performance of these loans. During 2018, we initiated steps to limit the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 548.35 Td (volume of these loans that we purchase with high DTI ratios that have other high-risk characteristics.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 526.95 Td (We employ a quality control process to review loan underwriting documentation for compliance with our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 511.55 Td (standards using both random and targeted samples. We also perform quality control reviews of many ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 496.15 Td (delinquent loans and review all loans that have resulted in credit losses before the representations and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 480.75 Td (warranties are relieved. Sellers may appeal our ineligible loan determinations prior to repurchase of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 465.35 Td (loan.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 443.95 Td (We use a standard quality control process that facilitates more timely reviews and is designed to identify ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 428.55 Td (breaches of representations and warranties early in the life of the loan. Proprietary tools, such as Quality ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 413.15 Td (Control Advisor, provide greater transparency into our customer quality control reviews. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 391.75 Td (Our Loan Advisor Suite, a set of integrated software applications, is designed to give lenders a way to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 376.35 Td (originate and deliver high quality mortgage loans to us and to actively monitor representation and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 360.95 Td (warranty relief earlier in the mortgage loan production process. Loan Advisor Suite offers limited relief of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 345.55 Td (representations and warranties for certain loans that satisfy automated controls related to appraisal ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 330.15 Td (quality, collateral valuation, borrower assets, and borrower income. In general, limited representation ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 314.75 Td (and warranty relief is only offered when we have validated the information provided by lenders against ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 299.35 Td (independent data sources. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 277.95 Td (If we discover that the representations or warranties related to a loan were breached \(i.e., that ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 262.55 Td (contractual standards were not followed\), we can exercise certain contractual remedies to mitigate our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 247.15 Td (actual or potential credit losses. These contractual remedies include the ability to require the seller or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 231.75 Td (servicer to repurchase the loan at its current UPB, reimburse us for losses realized with respect to the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 216.35 Td (loan after consideration of any other recoveries, and/or indemnify us. Our current remedies framework ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 200.95 Td (provides for the categorization of loan origination defects for loans with settlement dates on or after ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 185.55 Td (January 1, 2016. Among other items, the framework provides that "significant defects" will result in a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 170.15 Td (repurchase request or a repurchase alternative, such as recourse or indemnification.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 148.75 Td (Under our current selling and servicing representation and warranty framework for our mortgage loans, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 133.35 Td (we relieve sellers of repurchase obligations for breaches of certain selling representations and warranties ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 117.95 Td (for certain types of loans, including:) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 97.29 cm /I765 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 97.29 cm /I766 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 99.55 Td (Loans that have established an acceptable payment history for 36 months \(12 months for relief ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 84.15 Td (refinance loans\) of consecutive, on-time payments after purchase, subject to certain exclusions and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 63.49 cm /I767 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 63.49 cm /I768 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 65.75 Td (Loans that have satisfactorily completed a quality control review.) Tj ET Q endstream endobj 193 0 obj <> endobj 194 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (92) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (An independent dispute resolution process for alleged breaches of selling or servicing representations ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (and warranties on our loans allows for a neutral third party to render a decision on demands that remain ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 708.35 Td (unresolved after the existing appeal and escalation processes have been exhausted.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 686.95 Td (The credit quality of our single-family loan purchases is strong by historical standards. However, risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.55 Td (increased during 2018 as our refinance volume declined due to rising interest rates and our purchase of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 656.15 Td (loans under affordable housing initiatives increased. The graphs below show the credit profile of the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 640.75 Td (single-family loans we purchased or guaranteed in each of the last three years.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 89.70 605.35 Td (Weighted Average Original LTV Ratio ) Tj ET Q /GS0 gs q 238.50 0 0 294.00 49.50 303.35 cm /I769 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 288.00 308.35 Td ( ) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 376.00 605.35 Td (Weighted Average Credit Score ) Tj ET Q BT /F14 11.00 Tf ET q 0 0 0 rg BT 513.10 605.35 Td ( ) Tj ET Q /GS0 gs q 238.50 0 0 297.00 324.00 303.35 cm /I770 Do Q BT /F2 11.00 Tf ET endstream endobj 195 0 obj <> endobj 196 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (93) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (The table below contains additional information about the single-family loans we purchased or ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (guaranteed in the last three years.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 702.35 Td (Table 19 - Single-Family New Business Activity) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 219.00 685.85 344.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 219.00 670.85 112.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 335.00 670.85 112.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 451.00 670.85 112.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 655.85 165.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 219.00 655.85 56.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 275.00 655.85 56.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 335.00 655.85 56.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 391.00 655.85 56.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 451.00 655.85 56.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 507.00 655.85 56.00 -14.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 670.85 m 331 655.85 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 275 655.85 m 275 641.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 655.85 m 331 641.85 l s 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 391 655.85 m 391 641.85 l s 1 1 1 RG /GS0 gs 2.00 w 0 i [] 0 d 0 J 0 j 3 M 507 655.85 m 507 641.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 571.85 m 507 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 507 571.85 m 563 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 571.85 m 215 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 558.85 m 215 558.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 556.85 m 215 556.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 219 571.85 m 275 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 219 558.85 m 275 558.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 219 556.85 m 275 556.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 571.85 m 331 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 558.85 m 331 558.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 556.85 m 331 556.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 571.85 m 391 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 558.85 m 391 558.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 556.85 m 391 556.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 391 571.85 m 447 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 391 558.85 m 447 558.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 391 556.85 m 447 556.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 571.85 m 507 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 558.85 m 507 558.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 556.85 m 507 556.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 507 571.85 m 563 571.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 507 558.85 m 563 558.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 507 556.85 m 563 556.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 430.85 m 215 430.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 219 430.85 m 275 430.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 430.85 m 331 430.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 430.85 m 391 430.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 391 430.85 m 447 430.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 430.85 m 507 430.85 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 507 430.85 m 563 430.85 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 340.10 676.21 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 264.90 661.21 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 380.90 661.21 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 496.90 661.21 Td (2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 646.64 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 232.55 646.92 Td (Amount) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 284.80 646.92 Td (% of Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 348.55 646.92 Td (Amount) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 400.80 646.92 Td (% of Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 464.55 646.92 Td (Amount) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 516.80 646.92 Td (% of Total) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 632.92 Td (30-year or more amortizing fixed-rate) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 239.40 632.92 Td ($266,995) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.80 632.92 Td (87) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 323.65 632.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.40 632.92 Td ($275,677) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 632.92 Td (80) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 439.65 632.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 471.40 632.92 Td ($307,572) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 632.92 Td (78) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 632.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 618.92 Td (20-year amortizing fixed-rate) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 252.35 618.92 Td (8,373) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 319.10 618.92 Td (3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 364.00 618.92 Td (12,338) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 435.10 618.92 Td (4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 480.00 618.92 Td (17,011) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 551.10 618.92 Td (4) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 604.92 Td (15-year amortizing fixed-rate) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 248.00 604.92 Td (28,878) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 319.10 604.92 Td (9) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 364.00 604.92 Td (45,597) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 604.92 Td (13) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 480.00 604.92 Td (61,223) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 604.92 Td (16) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 590.92 Td (Adjustable-rate) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 252.35 590.92 Td (3,848) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 319.10 590.92 Td (1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 368.35 590.92 Td (9,841) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 435.10 590.92 Td (3) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 484.35 590.92 Td (6,555) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 551.10 590.92 Td (2) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 576.92 Td (FHA/VA and other governmental) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 258.80 576.92 Td (103) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.45 576.92 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 374.80 576.92 Td (113) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.45 576.92 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 490.80 576.92 Td (146) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.45 576.92 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 562.92 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 239.40 562.92 Td ($308,197) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 310.45 562.92 Td (100) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 323.45 562.92 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 355.40 562.92 Td ($343,566) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 426.45 562.92 Td (100) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 439.45 562.92 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 471.40 562.92 Td ($392,507) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 542.45 562.92 Td (100) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 555.45 562.92 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 533.92 Td (Percentage of purchases) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 519.92 Td (With credit enhancements) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.80 519.92 Td (40) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 323.65 519.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 519.92 Td (30) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 439.65 519.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 519.92 Td (26) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 519.92 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 505.92 Td (Detached/townhome property type) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.80 505.92 Td (92) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 505.92 Td (91) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 505.92 Td (92) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 491.92 Td (Primary residence) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.80 491.92 Td (90) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 491.92 Td (89) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 491.92 Td (90) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 477.92 Td (Loan purpose) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 463.92 Td (Purchase) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.80 463.92 Td (69) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 463.92 Td (58) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 463.92 Td (45) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 449.92 Td (Cash-out refinance) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.80 449.92 Td (19) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 449.92 Td (22) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 449.92 Td (22) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 435.92 Td (Other refinance) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 314.80 435.92 Td (12) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.80 435.92 Td (20) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 546.80 435.92 Td (33) Tj ET Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 412.15 Td (The table below contains additional details on the relief refinance loans we purchased. ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 392.95 Td (Table 20 - Relief Refinance Loan Purchases) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 230.00 382.45 333.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 230.00 367.45 164.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 398.00 367.45 165.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 352.45 176.00 -27.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 230.00 352.45 55.00 -27.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 285.00 352.45 54.00 -27.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 339.00 352.45 55.00 -27.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 398.00 352.45 55.00 -27.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 453.00 352.45 55.00 -27.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 508.00 352.45 55.00 -27.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 285 352.45000000000005 m 285 325.45000000000005 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 339 352.45000000000005 m 339 325.45000000000005 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 453 352.45000000000005 m 453 325.45000000000005 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 508 352.45000000000005 m 508 325.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398 269.45000000000005 m 453 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 453 269.45000000000005 m 508 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 269.45000000000005 m 563 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 269.45000000000005 m 226 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 256.45000000000005 m 226 256.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 254.45000000000005 m 226 254.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 230 269.45000000000005 m 285 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 230 256.45000000000005 m 285 256.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 230 254.45000000000005 m 285 254.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 269.45000000000005 m 339 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 256.45000000000005 m 339 256.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 285 254.45000000000005 m 339 254.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 269.45000000000005 m 394 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 256.45000000000005 m 394 256.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 339 254.45000000000005 m 394 254.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398 269.45000000000005 m 453 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398 256.45000000000005 m 453 256.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398 254.45000000000005 m 453 254.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 453 269.45000000000005 m 508 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 453 256.45000000000005 m 508 256.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 453 254.45000000000005 m 508 254.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 269.45000000000005 m 563 269.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 256.45000000000005 m 563 256.45000000000005 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 254.45000000000005 m 563 254.45000000000005 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 345.60 372.81 Td (Year Ended December 31,) Tj ET Q BT /F9 10.00 Tf ET 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 301.90 364.95 19.20 -10.00 re f /GS0 gs q 1 1 1 rg BT 301.90 357.81 Td (2018) Tj ET Q BT /F9 10.00 Tf ET 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 470.40 364.95 19.20 -10.00 re f /GS0 gs q 1 1 1 rg BT 470.40 357.81 Td (2017) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 330.24 Td (\(UPB in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 249.70 330.52 Td (UPB) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 291.35 330.52 Td (Loan Count) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 351.50 339.52 Td (Average? Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 348.80 330.52 Td (Loan Size) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 417.70 330.52 Td (UPB) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 459.85 330.52 Td (Loan Count) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 520.50 339.52 Td (Average? Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 517.80 330.52 Td (Loan Size) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 316.52 Td (Above 125% Original LTV) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 268.80 316.52 Td ($28) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 322.80 316.52 Td (217) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 358.40 316.52 Td ($131,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 432.50 316.52 Td ($141) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 491.80 316.52 Td (936) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 527.40 316.52 Td ($151,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 302.52 Td (Above 100% to 125% Original LTV) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 268.80 302.52 Td (119) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 322.80 302.52 Td (685) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 362.70 302.52 Td (174,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 436.80 302.52 Td (589) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.35 302.52 Td (3,197) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.70 302.52 Td (184,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 288.52 Td (Above 80% to 100% Original LTV) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 268.80 288.52 Td (438) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 316.35 288.52 Td (2,495) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 362.70 288.52 Td (176,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.35 288.52 Td (1,760) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.35 288.52 Td (9,737) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.70 288.52 Td (181,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 274.52 Td (80% and below Original LTV) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.35 274.52 Td (1,775) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 312.00 274.52 Td (12,294) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 362.70 274.52 Td (144,000) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 430.35 274.52 Td (5,900) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 481.00 274.52 Td (40,941) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.70 274.52 Td (144,000) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 260.52 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 258.00 260.52 Td ($2,360) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 312.00 260.52 Td (15,691) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 358.40 260.52 Td ($150,000) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 426.00 260.52 Td ($8,390) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 481.00 260.52 Td (54,811) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 527.40 260.52 Td ($153,000) Tj ET Q BT /F2 11.00 Tf ET BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 233.15 Td (Transferring Credit Risk of the Single-Family Credit Guarantee Portfolio to Investors in ) Tj ET Q BT /F6 14.00 Tf ET q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 216.35 Td (New and Innovative Ways) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 205.14999999999998 m 562.5 205.14999999999998 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 181.75 Td (Our Charter requires coverage by specified credit enhancements or participation interests on single-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 166.35 Td (family loans with LTV ratios above 80% at the time of purchase. In addition to obtaining credit ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 150.95 Td (enhancements required by our Charter, we also enter into various CRT transactions in which we transfer ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 135.55 Td (mortgage credit risk to third parties. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 114.15 Td (The table below contains a description of credit enhancements which transfer a portion of the credit risk ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 98.75 Td (on our single-family loans. ) Tj ET Q endstream endobj 197 0 obj <> endobj 198 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (94) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 50.00 746.50 61.00 -32.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 111.00 746.50 364.00 -32.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 475.00 746.50 22.00 -32.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 497.00 746.50 66.00 -32.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 637.50 61.00 -118.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 111.00 637.50 9.00 -68.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 120.00 637.50 355.00 -68.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 475.00 637.50 22.00 -68.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 497.00 637.50 66.00 -68.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 111.00 569.50 9.00 -50.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 120.00 569.50 355.00 -50.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 475.00 569.50 22.00 -50.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 497.00 569.50 66.00 -50.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 381.50 61.00 -108.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 111.00 381.50 9.00 -56.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 120.00 381.50 355.00 -56.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 475.00 381.50 22.00 -56.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 497.00 381.50 66.00 -56.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 111.00 325.50 9.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 120.00 325.50 355.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 475.00 325.50 22.00 -52.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 497.00 325.50 66.00 -52.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 94.5 m 111 94.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 111 94.5 m 120 94.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 120 94.5 m 475 94.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 475 94.5 m 497 94.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 94.5 m 563 94.5 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 733.36 Td (Credit) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 52.50 723.36 Td (Enhancement) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 113.50 728.36 Td (Description) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 477.50 728.36 Td (CRT) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 499.50 736.86 Td (When) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 499.50 726.86 Td (Coverage is) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 499.50 716.86 Td (Effective) Tj ET Q BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 683.86 Td (Primary) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 673.86 Td (mortgage) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 663.86 Td (insurance) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 113.50 704.86 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 704.86 Td (Provides loan-level protection against loss up to a specified amount, the premium for which is) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 694.86 Td (typically paid by the borrower. Generally, an insured loan must be in default and the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 684.86 Td (borrower's interest in the underlying property must have been extinguished, such as through a) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 674.86 Td (short sale or foreclosure sale, before a claim can be filed under a primary mortgage insurance) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 664.86 Td (policy. The mortgage insurer has a prescribed period of time within which to process a claim) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 654.86 Td (and make a determination as to its validity and amount. Most of our loans with LTV ratios) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 644.86 Td (above 80% are protected by primary mortgage insurance.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 673.86 Td (No) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 678.86 Td (At the time we) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 668.86 Td (acquire the loan) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 581.36 Td (STACR) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 571.36 Td (transactions) Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 627.15 Td (? Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 627.86 Td (STACR debt notes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 192.55 627.86 Td ( - Obligations we issue to third-party investors related to certain notional ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 617.86 Td (credit risk positions. Freddie Mac makes payments of principal and interest on the issued ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 607.86 Td (STACR debt notes. The amount of principal that is required to be paid to the STACR debt note ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 597.86 Td (investors is linked to the credit performance of a reference pool of mortgage loans. As a result, ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 587.86 Td (Freddie Mac is not required to repay principal to the extent that the notional credit risk ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 577.86 Td (position is reduced as a result of a specified credit event.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 601.36 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 616.36 Td (Subsequent to) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 606.36 Td (our purchase or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 596.36 Td (guarantee of) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 586.36 Td (loans) Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 559.15 Td (? Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 548.15 Td () Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 537.15 Td () Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 526.15 Td () Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 559.86 Td (STACR Trust) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 170.15 559.86 Td ( - Similar to STACR debt note transactions, except that the notes are issued by a ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 549.86 Td (third-party bankruptcy-remote trust. Under this structure, we pay a credit premium and ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 539.86 Td (certain shortfalls on the investment collateral account to the trust and receive payments from ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 529.86 Td (the trust as a result of defined credit events on the reference pool.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 542.36 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 557.36 Td (Subsequent to) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 547.36 Td (our purchase or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 537.36 Td (guarantee of) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 527.36 Td (loans) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 453.36 Td (ACIS) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 443.36 Td (transactions) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 113.50 509.86 Td (? Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 509.86 Td (ACIS) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 141.20 509.86 Td ( - Policies that provide credit protection on a portion of the non-issued notional credit risk ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 499.86 Td (positions we retain in a STACR transaction. We also enter into ACIS transactions that provide ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 489.86 Td (credit protection for certain specified credit events on loans not included in a reference pool ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 479.86 Td (created for a STACR transaction. In exchange for our payment of premiums, we receive ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 469.86 Td (compensation for certain losses under the insurance policy up to an aggregate limit when ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 459.86 Td (specified credit events occur. ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 481.86 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 496.86 Td (Subsequent to) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 486.86 Td (our purchase or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 476.86 Td (guarantee of) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 466.86 Td (loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 113.50 438.86 Td (? Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 438.86 Td (ACIS Forward Risk Mitigation \(AFRM\) transactions) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 322.12 438.86 Td ( - Transfer risks on a representative ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 428.86 Td (sample of loans from our single-family loan portfolio, locking in committed sources of ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 418.86 Td (institution based capital with stable pricing. When specific credit events occur, we receive ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 408.86 Td (compensation from the insurance policy up to an aggregate limit based on actual losses. ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 398.86 Td (AFRM includes Deep MI CRT which provides additional coverage beyond primary mortgage ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 387.99 Td (insurance) Tj ET Q BT /F12 11.00 Tf ET q 0 0 0 rg BT 158.60 387.99 Td (.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 412.86 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 417.86 Td (At the time we) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 407.86 Td (acquire the loan) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 340.36 Td (Senior) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 330.36 Td (subordinate) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 320.36 Td (securitization) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 310.36 Td (structures) Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 371.15 Td (? Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 360.15 Td () Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 349.15 Td () Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 338.15 Td () Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 371.86 Td (Senior subordinate securitization structures \(non-consolidated\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 374.85 371.86 Td ( - Structures in which we ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 361.86 Td (issue guaranteed senior securities and unguaranteed subordinated securities backed by ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 351.86 Td (certain reperforming single-family loans. The unguaranteed subordinated securities absorb ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 341.86 Td (first losses on the related loans. The loans are not serviced in accordance with our Guide and ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 331.86 Td (we do not control the servicing. ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 351.36 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 366.36 Td (Subsequent to) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 356.36 Td (our purchase or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 346.36 Td (guarantee of) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 336.36 Td (loans) Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 315.15 Td (? Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 304.15 Td () Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 293.15 Td () Tj ET Q BT /F5 11.00 Tf ET q 0 0 0 rg BT 113.50 282.15 Td () Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 315.86 Td (Senior subordinate securitization structures \(consolidated\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 356.35 315.86 Td ( - Structures in which we issue ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 305.86 Td (guaranteed senior securities or PCs and unguaranteed subordinated securities backed by ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 295.86 Td (recently originated single-family loans. The unguaranteed subordinated securities absorb first ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 285.86 Td (losses on the related loans. The loans are serviced in accordance with our Guide.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 297.36 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 312.36 Td (Subsequent to) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 302.36 Td (our purchase or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 292.36 Td (guarantee of) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 282.36 Td (loans) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 181.86 Td (Other) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 113.50 263.86 Td (? Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 263.86 Td (Integrated Mortgage Insurance \(IMAGIN) Tj ET Q BT /F9 10.00 Tf ET BT /F9 6.00 Tf ET q 0 0 0 rg BT 280.63 267.36 Td (SM) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 288.18 263.86 Td (\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 291.14 263.86 Td ( - A new insurance based offering that provides ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 253.86 Td (loan-level protection for loans with 80% and higher LTV ratios. IMAGIN is designed to expand ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 243.86 Td (and diversify sources of private capital supporting low down payment lending, while enabling ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 233.86 Td (better management of taxpayer exposure to our mortgage and counterparty risks. Each loan is ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 223.86 Td (first provided Charter-compliant primary mortgage insurance and is then reinsured by a panel ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 213.86 Td (of reinsurers that are reviewed and approved by Freddie Mac. IMAGIN is offered to a broad ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 203.86 Td (range of Freddie Mac sellers, who can choose IMAGIN or traditional primary mortgage ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 193.86 Td (insurance at their discretion.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 228.36 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 233.36 Td (At the time we) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 223.36 Td (acquire the loan) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 113.50 177.86 Td (? Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 177.86 Td (Lender recourse and indemnification agreements ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 320.40 177.86 Td (- Require a lender to repurchase a loan ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 167.86 Td (upon default or to reimburse us for realized credit losses. Lender recourse and lender ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 157.86 Td (indemnification agreements are entered into as an alternative to requiring primary mortgage ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 147.86 Td (insurance or in exchange for a lower guarantee fee. We have not used lender recourse or ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 137.86 Td (lender indemnification agreements on a broad basis in recent years. ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 157.36 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 162.36 Td (At the time we) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 152.36 Td (acquire the loan) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 113.50 121.86 Td (? Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 122.50 121.86 Td (Pool insurance) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 181.23 121.86 Td ( - Provides insurance on a group of loans up to a stated aggregate loss limit. ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 111.86 Td (We have not purchased pool insurance policies since 2008, and the majority of our pool ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 122.50 101.86 Td (insurance policies will expire in the next two years.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 477.50 110.86 Td (Yes) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 115.86 Td (At the time we) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 499.50 105.86 Td (acquire the loan) Tj ET Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 73.60 Td (See ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 71.50 73.60 Td (Our Business Segments - Single-Family Guarantee, Note 3, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 411.98 73.60 Td (and ) Tj ET Q BT /F7 11.00 Tf ET q 0 0 0 rg BT 433.59 73.60 Td (Note 6 ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 474.99 73.60 Td (for additional ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 58.20 Td (information on these transactions.) Tj ET Q endstream endobj 199 0 obj <> endobj 200 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (95) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (The tables below provide information on the total protected UPB and maximum coverage associated ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (with credit enhanced loans in our single-family credit guarantee portfolio as of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 434.01 723.75 Td (December?1, 2018) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 530.82 723.75 Td ( and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 708.35 Td (December 31, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 121.85 708.35 Td (2017) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 146.31 708.35 Td (, respectively. These tables include all types of single-family credit enhancements.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 686.95 Td (Table 21 - Details of Credit Enhanced Loans in Our Single-Family Credit Guarantee Portfolio ) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 235.00 670.45 328.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 235.00 655.45 59.00 -35.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 294.00 655.45 80.00 -35.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 374.00 655.45 189.00 -35.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 620.45 181.00 -16.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 235.00 620.45 59.00 -16.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 294.00 620.45 80.00 -16.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 374.00 620.45 63.00 -16.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 437.00 620.45 63.00 -16.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 500.00 620.45 63.00 -16.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 294 655.45 m 294 620.45 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 374 655.45 m 374 620.45 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 374 620.45 m 374 604.45 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 374 620.45 m 374 604.45 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 437 620.45 m 437 604.45 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 500 620.45 m 500 604.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 514.45 m 231 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 514.45 m 294 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 514.45 m 374 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 514.45 m 437 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 514.45 m 500 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 514.45 m 563 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 514.45 m 231 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 501.45 m 231 501.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 499.45 m 231 499.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 514.45 m 294 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 501.45 m 294 501.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 499.45 m 294 499.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 514.45 m 374 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 501.45 m 374 501.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 499.45 m 374 499.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 514.45 m 437 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 501.45 m 437 501.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 499.45 m 437 499.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 514.45 m 500 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 501.45 m 500 501.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 499.45 m 500 499.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 514.45 m 563 514.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 501.45 m 563 501.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 499.45 m 563 499.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 427.45 m 231 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 427.45 m 294 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 427.45 m 374 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 427.45 m 437 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 427.45 m 500 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 427.45 m 563 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 427.45 m 231 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 427.45 m 294 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 427.45 m 374 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 427.45 m 437 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 427.45 m 500 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 427.45 m 563 427.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 387.45 m 231 387.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 374.45 m 231 374.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 372.45 m 231 372.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 387.45 m 294 387.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 374.45 m 294 374.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 235 372.45 m 294 372.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 387.45 m 374 387.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 374.45 m 374 374.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 294 372.45 m 374 372.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 387.45 m 437 387.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 374.45 m 437 374.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 372.45 m 437 372.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 387.45 m 500 387.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 374.45 m 500 374.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 372.45 m 500 372.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 387.45 m 563 387.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 374.45 m 563 374.45 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 372.45 m 563 372.45 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 324.30 660.81 Td (Outstanding as of December 31, 2018) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 246.80 634.52 Td (Protected ) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 253.80 625.52 Td (UPB) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 268.32 628.67 Td (\(1\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 308.65 643.52 Td (Percentage of) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 297.25 634.52 Td (Single-Family Credit) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 298.90 625.52 Td (Guarantee Portfolio) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 429.65 625.52 Td (Maximum Coverage) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 500.48 628.67 Td (\(2\)) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 609.24 Td (\(In millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 255.25 609.52 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 324.75 609.52 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 384.85 609.52 Td (First Loss) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 419.31 612.67 Td (\(3\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 448.90 609.52 Td (Mezzanine) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 522.25 609.52 Td (Total) Tj ET Q BT /F9 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 595.52 Td (CRT Activities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 581.52 Td ( STACR transactions) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 258.40 581.52 Td ($766,415) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 581.52 Td (40) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.45 581.52 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.00 581.52 Td ($3,777) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 468.70 581.52 Td ($18,845) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.70 581.52 Td ($22,622) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 567.52 Td ( ACIS transactions) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.70 567.52 Td (807,885) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 567.52 Td (43) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.35 567.52 Td (1,552) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 477.35 567.52 Td (7,571) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 567.52 Td (9,123) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 553.52 Td (Senior subordinate securitization structures) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.00 553.52 Td (39,860) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 362.10 553.52 Td (2) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.35 553.52 Td (1,807) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 477.35 553.52 Td (2,046) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 553.52 Td (3,853) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 539.52 Td ( Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.00 539.52 Td (18,136) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 362.10 539.52 Td (1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.35 539.52 Td (5,049) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 483.80 539.52 Td (340) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 539.52 Td (5,389) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 525.52 Td (Less: UPB with more than one type of ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 516.52 Td (CRT Activity) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.55 519.52 Td (\(736,334) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 290.80 519.52 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.60 519.52 Td (\(39) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.45 519.52 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.75 519.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 519.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 550.75 519.52 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 58.50 505.52 Td (Total CRT Activities) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 258.40 505.52 Td ($895,962) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 357.80 505.52 Td (47) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 366.45 505.52 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 405.70 505.52 Td ($12,185) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 468.70 505.52 Td ($28,802) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 531.70 505.52 Td ($40,987) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 480.52 Td (Other Credit Enhancements:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 466.52 Td ( Primary Mortgage Insurance) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.70 466.52 Td (378,594) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 466.52 Td (20) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.65 466.52 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.00 466.52 Td (96,996) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 466.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.00 466.52 Td (96,996) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 452.52 Td ( Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 271.35 452.52 Td (2,642) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.45 452.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.35 452.52 Td (1,341) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 452.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 452.52 Td (1,341) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 438.52 Td (Less: UPB with both CRT and other credit) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 429.52 Td (enhancements) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.55 432.52 Td (\(254,774) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 290.80 432.52 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.60 432.52 Td (\(13) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.45 432.52 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.75 432.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 432.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 550.75 432.52 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 418.52 Td (Single-family credit guarantee portfolio with) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 409.52 Td (credit enhancement) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 256.20 412.52 Td (1,022,424) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 412.52 Td (54) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 405.70 412.52 Td (110,522) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 473.00 412.52 Td (28,802) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.70 412.52 Td (139,324) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 398.52 Td (Single-family credit guarantee portfolio without) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 389.52 Td (credit enhancement) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.70 392.52 Td (873,762) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 392.52 Td (46) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.75 392.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 392.52 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 550.75 392.52 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 54.00 378.52 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 251.90 378.52 Td ($1,896,186) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 353.45 378.52 Td (100) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 366.45 378.52 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 401.40 378.52 Td ($110,522) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 468.70 378.52 Td ($28,802) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 527.40 378.52 Td ($139,324) Tj ET Q BT /F2 11.00 Tf ET endstream endobj 201 0 obj <> endobj 202 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 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441.5 m 374 441.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 456.5 m 437 456.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 443.5 m 437 443.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 374 441.5 m 437 441.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 456.5 m 500 456.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 443.5 m 500 443.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 441.5 m 500 441.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 456.5 m 563 456.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 443.5 m 563 443.5 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 500 441.5 m 563 441.5 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 324.30 736.86 Td (Outstanding as of December 31, 2017) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 246.80 710.57 Td (Protected ) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 253.80 701.57 Td (UPB) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 268.32 704.72 Td (\(1\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 308.65 719.57 Td (Percentage of) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 297.25 710.57 Td (Single-Family Credit) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 298.90 701.57 Td (Guarantee Portfolio) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 429.65 701.57 Td (Maximum Coverage) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 500.48 704.72 Td (\(2\)) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 685.29 Td (\(In millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 255.25 685.57 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 324.75 685.57 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 384.85 685.57 Td (First Loss) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 419.31 688.72 Td (\(3\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 448.90 685.57 Td (Mezzanine) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 522.25 685.57 Td (Total) Tj ET Q BT /F9 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 671.57 Td (CRT Activities:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 657.57 Td ( STACR transactions) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 258.40 657.57 Td ($604,356) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 657.57 Td (33) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.45 657.57 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.00 657.57 Td ($1,888) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 468.70 657.57 Td ($15,900) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.70 657.57 Td ($17,788) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 643.57 Td ( ACIS transactions) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.70 643.57 Td (625,082) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 643.57 Td (34) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 420.80 643.57 Td (881) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 477.35 643.57 Td (6,052) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 643.57 Td (6,933) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 629.57 Td (Senior subordinate securitization structures) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 267.00 629.57 Td (10,688) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 362.10 629.57 Td (1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.35 629.57 Td (1,070) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 483.80 629.57 Td (683) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 629.57 Td (1,753) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 615.57 Td ( Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 271.35 615.57 Td (7,233) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.45 615.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.35 615.57 Td (4,892) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 615.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 615.57 Td (4,892) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 597.57 Td (Less: UPB with more than one type of ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 588.57 Td (CRT Activity) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.55 588.57 Td (\(581,529) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 290.80 588.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.60 588.57 Td (\(32) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.45 588.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.75 588.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 588.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 550.75 588.57 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 58.50 574.57 Td (Total CRT Activities) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 258.40 574.57 Td ($665,830) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 357.80 574.57 Td (36) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 366.45 574.57 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 410.00 574.57 Td ($8,731) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 468.70 574.57 Td ($22,635) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 531.70 574.57 Td ($31,366) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 549.57 Td (Other Credit Enhancements:) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 535.57 Td ( Primary Mortgage Insurance) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.70 535.57 Td (334,189) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 535.57 Td (18) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.00 535.57 Td (85,429) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 535.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 536.00 535.57 Td (85,429) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 521.57 Td ( Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 271.35 521.57 Td (2,985) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.45 521.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 414.35 521.57 Td (1,550) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 521.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 540.35 521.57 Td (1,550) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 507.57 Td (Less: UPB with both CRT and other credit) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 498.57 Td (enhancements) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 260.55 501.57 Td (\(194,222) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 290.80 501.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 355.60 501.57 Td (\(11) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.45 501.57 Td (\)) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.75 501.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 501.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 550.75 501.57 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 487.57 Td (Single-family credit guarantee portfolio with) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 478.57 Td (credit enhancement) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 262.70 481.57 Td (808,782) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 481.57 Td (44) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 366.65 481.57 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 410.00 481.57 Td (95,710) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 473.00 481.57 Td (22,635) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 531.70 481.57 Td (118,345) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 467.57 Td (Single-family credit guarantee portfolio without) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 458.57 Td (credit enhancement) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 256.20 461.57 Td (1,020,098) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 357.80 461.57 Td (56) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 424.75 461.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 487.75 461.57 Td (? Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 550.75 461.57 Td (? Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 54.00 447.57 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 251.90 447.57 Td ($1,828,880) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 353.45 447.57 Td (100) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 366.45 447.57 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 405.70 447.57 Td ($95,710) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 468.70 447.57 Td ($22,635) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 527.40 447.57 Td ($118,345) Tj ET Q BT /F2 11.00 Tf ET BT /F12 9.00 Tf ET q 0 0 0 rg BT 58.50 426.20 Td (\() Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 61.50 426.20 Td (1\) For STACR and ACIS transactions, represents the UPB of the assets included in the reference pool. For senior subordinate securitization structure ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 415.40 Td (transactions, represents the UPB of the guaranteed securities.) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 401.60 Td (\(2\) ) Tj ET Q q 0 0 0 rg BT 76.50 401.60 Td (For STACR transactions, represents the outstanding balance held by third parties. For ACIS transactions, represents the remaining aggregate limit ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 390.80 Td (of insurance purchased from third parties. For senior subordinate securitization structures, represents the UPB of the securities that are ) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 76.50 380.00 Td (subordinate to our guarantee and held by third parties.) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 58.50 366.20 Td (\(3\) First loss includes all B tranches in our STACR transactions and their equivalent in ACIS and Other CRT transactions.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 347.80 Td (We had coverage remaining of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 201.98 347.80 Td ($139.3 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 267.40 347.80 Td ( and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 292.06 347.80 Td ($118.3 billion) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 357.48 347.80 Td ( on our single-family credit guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 332.40 Td (portfolio as of December 31, 2018 and December 31, 2017, respectively. Credit risk transfer transactions ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 317.00 Td (provided ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 95.75 317.00 Td (29.4%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 128.16 317.00 Td ( and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 152.82 317.00 Td (26.5%) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 185.23 317.00 Td ( of the coverage remaining at those dates. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 295.60 Td (Since the launch of the IMAGIN offering in March 2018, we have obtained coverage of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 474.45 295.60 Td ($155 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 533.55 295.60 Td ( on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 280.20 Td ($607 million) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 108.60 280.20 Td ( in UPB with approximately ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 244.56 280.20 Td (20) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 256.80 280.20 Td ( lenders participating in this offering. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 258.85 Td (The table below provides information on the non-credit-enhanced and credit-enhanced loans in our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 243.45 Td (single-family credit guarantee portfolio. The credit enhanced categories are not mutually exclusive as a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 228.05 Td (single loan may be covered by both primary mortgage insurance and other credit protection.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 206.65 Td (Table 22 - Non-Credit-Enhanced and Credit-Enhanced Loans in Our Single-Family Credit ) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 191.25 Td (Guarantee Portfolio) Tj ET Q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg /GS0 gs 195.00 180.75 368.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 195.00 165.75 120.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 319.00 165.75 120.00 -15.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 443.00 165.75 120.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 150.75 141.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 195.00 150.75 60.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 255.00 150.75 60.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 319.00 150.75 60.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 379.00 150.75 60.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 443.00 150.75 60.00 -14.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 503.00 150.75 60.00 -14.00 re f /GS0 gs 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 255 150.75 m 255 136.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 379 150.75 m 379 136.75 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 503 150.75 m 503 136.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 195 80.75 m 255 80.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 255 80.75 m 315 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 80.75 m 379 80.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 80.75 m 439 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 80.75 m 191 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 67.75 m 191 67.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 65.75 m 191 65.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 195 80.75 m 255 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 195 67.75 m 255 67.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 195 65.75 m 255 65.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 255 80.75 m 315 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 255 67.75 m 315 67.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 255 65.75 m 315 65.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 80.75 m 379 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 67.75 m 379 67.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 319 65.75 m 379 65.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 80.75 m 439 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 67.75 m 439 67.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 379 65.75 m 439 65.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 443 80.75 m 503 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 443 67.75 m 503 67.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 443 65.75 m 503 65.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 503 80.75 m 563 80.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 503 67.75 m 563 67.75 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 503 65.75 m 563 65.75 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 340.10 171.11 Td (As of December 31,) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 244.90 156.11 Td (2018) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 368.90 156.11 Td (2017) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 492.90 156.11 Td (2016) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 141.54 Td (\(Percentage of portfolio based on UPB\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 200.15 141.82 Td (% of Portfolio) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 267.95 141.82 Td (SDQ Rate) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 324.15 141.82 Td (% of Portfolio) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 391.95 141.82 Td (SDQ Rate) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 448.15 141.82 Td (% of Portfolio) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 515.95 141.82 Td (SDQ Rate) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 127.82 Td (Non-credit-enhanced) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 239.00 127.82 Td (47) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 247.65 127.82 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 292.30 127.82 Td (0.83) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 307.65 127.82 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 127.82 Td (56) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 371.65 127.82 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 416.30 127.82 Td (1.16) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 431.65 127.82 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.50 127.82 Td (64) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 495.65 127.82 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.00 127.82 Td (1.02) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 555.65 127.82 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 113.82 Td (Credit-enhanced) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 99.82 Td ( Primary mortgage insurance) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 239.00 99.82 Td (20) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 292.30 99.82 Td (0.86) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 99.82 Td (18) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 416.30 99.82 Td (1.43) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.50 99.82 Td (17) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.00 99.82 Td (1.46) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 85.82 Td ( Other) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 239.00 85.82 Td (48) Tj ET Q BT /F12 8.00 Tf ET q 0 0 0 rg BT 291.85 84.98 Td (0.31) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 363.00 85.82 Td (37) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 416.30 85.82 Td (0.53) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 485.50 85.82 Td (27) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 539.00 85.82 Td (0.43) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 52.50 71.82 Td (Total) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 238.30 71.82 Td (N/A) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 292.30 71.82 Td (0.69) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 307.45 71.82 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 362.30 71.82 Td (N/A) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 416.30 71.82 Td (1.08) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 431.45 71.82 Td (%) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 486.30 71.82 Td (N/A) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 539.00 71.82 Td (1.00) Tj ET Q BT /F9 9.00 Tf ET q 0 0 0 rg BT 555.45 71.82 Td (%) Tj ET Q BT /F2 11.00 Tf ET endstream endobj 203 0 obj <> endobj 204 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (97) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (The table below provides information on estimated recoveries we could receive over the risk transfer ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (coverage period from our most significant credit risk transfer transactions \(i.e., STACR debt notes, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 708.35 Td (STACR Trusts, and ACIS insurance policies\) under various home price scenarios.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 686.95 Td (The timing of our recognition of the recoveries in our statements of comprehensive income will depend ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 671.55 Td (on the type of CRT transaction and whether we are reimbursed based on calculated losses or actual ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 656.15 Td (losses, which may result in timing differences between the recognition of CRT recoveries and the related ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 640.75 Td (provisions for losses in the financial statements. We recognize losses on the loans in the reference pool ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 625.35 Td (when losses are incurred as defined by GAAP. For certain CRT transactions based on actual losses, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 609.95 Td (including STACR Trust and ACIS transactions, recoveries are recognized at the same time as we ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 594.55 Td (recognize the losses on the loans in the reference pool. However, for our STACR debt notes based on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 579.15 Td (actual losses, recoveries are recognized in the financial statements when the loss confirming event ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 563.75 Td (occurs \(i.e., third-party foreclosure sale or REO disposition, deed in lieu of foreclosure, short sale, etc.\), ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 548.35 Td (which may be several years after the related losses are incurred. Credit risk transfer transactions based ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 532.95 Td (on calculated losses are measured at fair value through earnings, so the change in fair value may be ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 517.55 Td (recognized prior to the incurrence of the loss.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 496.15 Td (In the table below, we estimate the potential recoveries from our STACR and ACIS transactions using a ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 480.75 Td (sensitivity analysis that utilizes our historical loss and prepayment experience related to loans originated ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 465.35 Td (during periods that experienced above average home price appreciation, moderate home price ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 449.95 Td (appreciation, and severe home price depreciation. We match these loans to similar groups within the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 434.55 Td (reference pools \(related to our CRT transactions with collateral that is reasonably similar to the historical ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 419.15 Td (time periods being compared; for example, HARP loans, which did not exist prior to 2009, are excluded ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 403.75 Td (from this analysis\) using two of the more significant observed credit sensitive mortgage loan attributes, ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 388.35 Td (LTV ratios, and origination FICO scores. Our recoveries under these scenarios were estimated based on ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 372.95 Td (loan losses, net of mortgage insurance claim amounts. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 351.55 Td (These are only estimated projections and are designed to illustrate the potential for significant ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 336.15 Td (differences in losses and recoveries depending on the economic environment and other factors. Our ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 320.75 Td (actual losses and recoveries under these scenarios could differ materially from these estimates. For ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 305.35 Td (example, significant improvements to underwriting standards and origination practices since the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 289.95 Td (financial crisis may result in lower loan losses and loss coverage ratio than the scenario-based ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 274.55 Td (projections in the table below. In addition, these estimates do not include interest expense and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 259.15 Td (transaction costs we incur to issue our STACR debt notes and premiums we pay on ACIS and STACR ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 243.75 Td (Trust transactions.) Tj ET Q endstream endobj 205 0 obj <> endobj 206 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (98) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (Table 23 - Single-Family Guarantee Portfolio Credit Risk Transfer Sensitivity Analysis ) Tj ET Q 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 722.65 195.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 249.00 722.65 102.00 -13.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 249.00 676.65 314.00 -13.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 249.00 663.65 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0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 249 688.65 m 300 688.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 300 688.65 m 351 688.65 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 300 638.65 m 300 625.65 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 406 638.65 m 406 625.65 l s 1 1 1 RG /GS0 gs 1.50 w 0 i [] 0 d 0 J 0 j 3 M 512 638.65 m 512 625.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 578.65 m 245 578.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 249 578.65 m 300 578.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 300 578.65 m 351 578.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 355 578.65 m 406 578.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 406 578.65 m 457 578.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 461 578.65 m 512 578.65 l s 0 0.6509803921568628 0.8862745098039215 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 512 578.65 m 563 578.65 l s BT /F9 8.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 714.44 Td (\(In millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 255.20 713.72 Td (As of December 31, 2018) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 700.72 Td (UPB of loans covered by STACR transactions and ACIS) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 691.72 Td (insurance policies) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 311.25 693.72 Td ($806,114) Tj ET Q BT /F9 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 291.15 667.72 Td (Performance Under Home Price Scenarios at December 31, 2018) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 251.75 652.72 Td (Above Average Home Price ) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 262.25 643.72 Td (Appreciation \(47%\)) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 330.94 646.87 Td (\(1\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 367.20 652.72 Td (Moderate Home Price ) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 370.40 643.72 Td (Appreciation \(7%\)) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 434.77 646.87 Td (\(1\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 478.05 652.72 Td (Severe Home Price ) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 472.70 643.72 Td (Depreciation \(-24%\)) Tj ET Q BT /F9 9.00 Tf ET BT /F9 5.40 Tf ET q 1 1 1 rg BT 544.46 646.87 Td (\(1\)) Tj ET Q BT /F9 8.00 Tf ET q 1 1 1 rg BT 52.50 630.44 Td (\(Dollars in millions\)) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 260.05 629.72 Td (Amount) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 318.50 629.72 Td (bps) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 366.05 629.72 Td (Amount) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 424.50 629.72 Td (bps) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 472.05 629.72 Td (Amount) Tj ET Q BT /F9 9.00 Tf ET q 1 1 1 rg BT 530.50 629.72 Td (bps) Tj ET Q BT /F5 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 616.72 Td (Estimated credit losses) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.35 616.72 Td ($515) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 343.95 616.72 Td (6) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 374.85 616.72 Td ($3,064) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.65 616.72 Td (38) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 476.55 616.72 Td ($19,047) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 547.30 616.72 Td (236) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 603.72 Td (Estimated recoveries from STACR transactions and ACIS) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 594.72 Td (insurance policies) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 275.35 596.72 Td ($112) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 343.95 596.72 Td (1) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 374.85 596.72 Td ($1,227) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 445.65 596.72 Td (15) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 476.55 596.72 Td ($12,568) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 547.30 596.72 Td (156) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 52.50 582.72 Td (Loss coverage ratio) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 284.00 582.72 Td (22) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 292.65 582.72 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 335.45 582.72 Td (N/A) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 390.00 582.72 Td (40) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 398.65 582.72 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 441.45 582.72 Td (N/A) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 496.00 582.72 Td (66) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 504.65 582.72 Td (%) Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 547.45 582.72 Td (N/A) Tj ET Q BT /F2 11.00 Tf ET BT /F5 8.00 Tf ET q 0 0 0 rg BT 58.50 562.35 Td (\() Tj ET Q BT /F5 9.00 Tf ET q 0 0 0 rg BT 60.43 562.35 Td (1\) Home price change is over a four-year period.) Tj ET Q BT /F6 14.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 539.55 Td (Monitoring Loan Performance and Characteristics of the Single-Family Credit ) Tj ET Q BT /F6 14.00 Tf ET q 0 0.6509803921568628 0.8862745098039215 rg BT 49.50 522.75 Td (Guarantee Portfolio and Individual Sellers and Servicers) Tj ET Q 0 0 0 RG /GS0 gs 2.00 w 0 i [] 0 d 1 J 1 j 3 M 49.5 511.55 m 562.5 511.55 l s BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 488.15 Td (We review loan performance, including delinquency statistics and related loan characteristics in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 472.75 Td (conjunction with housing market and economic conditions, to determine if our pricing and eligibility ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 457.35 Td (standards reflect the risk associated with the loans we purchase and guarantee. We review the payment ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 441.95 Td (performance of our loans to facilitate early identification of potential problem loans, which could inform ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 426.55 Td (our loss mitigation strategies. We also review performance metrics for additional loan characteristics ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 411.15 Td (that may expose us to concentrations of credit risk, including: ) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 390.49 cm /I771 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 390.49 cm /I772 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 392.75 Td (Higher risk loan attributes and attribute combinations;) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 372.09 cm /I773 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 372.09 cm /I774 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 374.35 Td (Higher risk loan product types; and) Tj ET Q /GS0 gs q 8.21 0 0 11.74 49.50 353.69 cm /I775 Do Q /GS0 gs q 9.79 0 0 11.74 57.71 353.69 cm /I776 Do Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 67.50 355.95 Td (Geographic concentrations. ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 334.55 Td (We actively monitor seller and servicer performance, including compliance with our standards, and ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 319.15 Td (periodically review their operational processes. We also periodically change seller/servicer guidelines ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 303.75 Td (based on the results of our mortgage portfolio monitoring, if warranted. ) Tj ET Q BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 282.35 Td (Delinquency Rates ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 260.95 Td (Our single-family serious delinquency rate declined in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 314.79 260.95 Td (2018) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 339.25 260.95 Td ( compared to 2017 due to the greater impact ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 245.55 Td (of the hurricane activity in 2017 than subsequent hurricanes in 2018. This decline is also attributable to ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 230.15 Td (our continued loss mitigation efforts and sales of certain seriously delinquent loans, as well as home ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 214.75 Td (price appreciation and a low unemployment rate. In addition, this improvement was driven by the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 199.35 Td (continued shift in the single-family credit guarantee portfolio mix, as the legacy and relief refinance loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 183.95 Td (portfolio runs off and we add high credit quality loans to our core single-family loan portfolio.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 162.55 Td (Our loss mitigation activities may create fluctuations in our delinquency statistics. For example, loans in ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 147.15 Td (modification trial periods, loans subject to forbearance agreements, and loans in repayment plans ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 131.75 Td (continue to be reported as seriously delinquent. There may also be temporary lags in the reporting of ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 116.35 Td (payment status and modification completion due to differing practices of our servicers that can affect ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 100.95 Td (our delinquency statistics.) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 79.55 Td (The charts below show the credit losses and serious delinquency rates for each of our single-family loan ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 64.15 Td (portfolios. Our core single-family loan portfolio continues to perform well and account for a small ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 48.75 Td (percentage of our credit losses, as shown below. Our legacy and relief refinance single-family loan ) Tj ET Q endstream endobj 207 0 obj <> endobj 208 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 547.45 30.07 Td (99) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (portfolio continues to decline as a percentage of our overall portfolio, but continues to account for the ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (majority of our credit losses.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 49.50 704.55 Td ( Portfolio Composition and Credit Losses ) Tj ET Q BT /F18 11.00 Tf ET q 0 0 0 rg BT 49.50 685.35 Td ( ) Tj ET Q /GS0 gs q 238.50 0 0 291.00 49.50 389.35 cm /I777 Do Q BT /F2 11.00 Tf ET BT /F11 11.00 Tf ET q 0 0 0 rg BT 342.00 704.55 Td (Serious Delinquency Rates as of December 31,) Tj ET Q /GS0 gs q 238.50 0 0 296.00 324.00 397.55 cm /I778 Do Q BT /F2 11.00 Tf ET BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 369.95 Td (The chart below shows the delinquency rates for mortgage loans in our single-family credit guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 354.55 Td (portfolio that are one month and two months past due.) Tj ET Q BT /F11 11.00 Tf ET q 0 0 0 rg BT 149.55 335.35 Td (Total Delinquency Rates for Loans One Month and Two Months Past Due ) Tj ET Q /GS0 gs q 350.00 0 0 274.00 131.00 47.35 cm /I779 Do Q BT /F2 11.00 Tf ET endstream endobj 209 0 obj <> endobj 210 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 541.45 30.07 Td (100) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F13 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (Loan Characteristics ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 717.75 Td (The table below contains a description of some of the loan characteristics we monitor in our single-) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 702.35 Td (family credit guarantee portfolio.) Tj ET Q 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 50.00 685.85 85.00 -20.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 135.00 685.85 200.00 -20.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 rg /GS0 gs 335.00 685.85 228.00 -20.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 580.85 85.00 -70.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 135.00 580.85 200.00 -70.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 580.85 10.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 580.85 218.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 545.85 10.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 545.85 218.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 475.85 85.00 -58.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 135.00 475.85 200.00 -58.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 475.85 10.00 -23.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 475.85 218.00 -23.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 452.85 10.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 452.85 218.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 382.85 85.00 -61.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 135.00 382.85 200.00 -61.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 382.85 10.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 382.85 218.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 347.85 10.00 -26.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 347.85 218.00 -26.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 50.00 272.85 85.00 -71.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 135.00 272.85 200.00 -71.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 272.85 10.00 -36.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 272.85 218.00 -36.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 335.00 236.85 10.00 -35.00 re f /GS0 gs 0.8627450980392157 0.9137254901960784 0.7803921568627451 rg /GS0 gs 345.00 236.85 218.00 -35.00 re f /GS0 gs 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 580.85 m 135 580.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 135 580.85 m 335 580.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 335 580.85 m 345 580.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 345 580.85 m 563 580.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 510.85 m 135 510.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 135 510.85 m 335 510.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 335 510.85 m 345 510.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 345 510.85 m 563 510.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 475.85 m 135 475.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 135 475.85 m 335 475.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 335 475.85 m 345 475.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 345 475.85 m 563 475.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 417.85 m 135 417.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 135 417.85 m 335 417.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 335 417.85 m 345 417.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 345 417.85 m 563 417.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 382.85 m 135 382.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 135 382.85 m 335 382.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 335 382.85 m 345 382.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 345 382.85 m 563 382.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 321.85 m 135 321.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 135 321.85 m 335 321.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 335 321.85 m 345 321.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 345 321.85 m 563 321.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 50 272.85 m 135 272.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 135 272.85 m 335 272.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 335 272.85 m 345 272.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 0.50 w 0 i [] 0 d 0 J 0 j 3 M 345 272.85 m 563 272.85 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 201.85000000000002 m 135 201.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 135 201.85000000000002 m 335 201.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 335 201.85000000000002 m 345 201.85000000000002 l s 0.5333333333333333 0.7411764705882353 0.27058823529411763 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 345 201.85000000000002 m 563 201.85000000000002 l s BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 1 1 1 rg BT 52.50 673.71 Td (Characteristic) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 137.50 673.71 Td (Description) Tj ET Q BT /F9 10.00 Tf ET q 1 1 1 rg BT 337.50 673.71 Td (Impact on Credit Quality) Tj ET Q BT /F9 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 52.50 621.21 Td (LTV Ratio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 646.21 Td (Ratio of the UPB of the loan to the value of the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 636.21 Td (underlying property collateralizing the loan. Original) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 626.21 Td (LTV ratio is measured at loan origination, while) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 616.21 Td (current LTV \(CLTV\) ratio is defined as the ratio of the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 606.21 Td (current loan UPB to the estimated current property) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 596.21 Td (value) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 656.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 656.21 Td (Measures ability of the underlying property to cover our ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 646.21 Td (exposure on the loan) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 632.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 632.21 Td (Higher LTV ratios indicate higher risk, as proceeds from) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 622.21 Td (sale of the property may not cover our exposure on the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 612.21 Td (loan) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 597.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 597.21 Td (Lower LTV ratios indicate borrowers are more likely to) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 587.21 Td (repay) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 543.71 Td (Credit Score) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 558.71 Td (Statistically-derived number used by lenders to) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 548.71 Td (assess a borrower's likelihood to repay debt. We use) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 538.71 Td (FICO scores, which are currently the most) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 528.71 Td (commonly used credit scores for mortgages) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 571.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 571.21 Td (Borrowers with higher credit scores are generally more) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 561.21 Td (likely to repay or have the ability to refinance their loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 551.21 Td (than those with lower scores) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 536.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 536.21 Td (Credit scores presented in this Form 10-K are at the time) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 526.21 Td (of origination and may not be indicative of the borrowers') Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 516.21 Td (current creditworthiness) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 491.21 Td (Loan Purpose) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 501.21 Td (Indicates how the borrower intends to use the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 491.21 Td (proceeds from a loan \(i.e., purchase, cash-out) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 481.21 Td (refinance, or other refinance\)) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 501.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 501.21 Td (Cash-out refinancings, which increase the LTV ratios,) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 491.21 Td (generally have had a higher risk of default than loans) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 481.21 Td (originated in purchase or other refinance transactions) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 444.71 Td (Property Type) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 449.71 Td (Indicates whether the property is a detached single-) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 439.71 Td (family house, townhouse, condominium, or co-op) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 466.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 466.21 Td (Detached single-family houses and townhouses are the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 456.21 Td (predominant type of single-family property) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 443.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 443.21 Td (Condominiums historically have experienced greater) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 433.21 Td (volatility in home prices than detached single-family) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 423.21 Td (houses, which may expose us to more risk) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 398.21 Td (Occupancy Type) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 408.21 Td (Indicates whether the borrower intends to use the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 398.21 Td (property as a primary residence, second home, or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 388.21 Td (investment property) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 408.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 408.21 Td (Loans on primary residence properties tend to have) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 398.21 Td (lower credit risk than loans on second homes or) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 388.21 Td (investment properties) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 350.21 Td (Product Type) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 360.21 Td (Indicates the type of loan based on key loan terms,) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 350.21 Td (such as the contractual maturity, type of interest) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 340.21 Td (rate, and payment characteristics of the loan) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 373.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 373.21 Td (Loan products that contain terms which result in) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 363.21 Td (scheduled changes in monthly payments may result in) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 353.21 Td (higher risk) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 338.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 338.21 Td (Shorter loan terms result in faster repayment of principal) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 328.21 Td (and may indicate lower risk) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 295.21 Td (Second Liens) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 305.21 Td (Indicates whether the underlying property is) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 295.21 Td (covered by more than one loan at the time of) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 285.21 Td (origination) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 312.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 312.21 Td (Second liens can increase the risk of default) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 298.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 298.21 Td (Borrowers are free to obtain second-lien financing after) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 288.21 Td (origination, and we are not entitled to receive notification) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 278.21 Td (when a borrower does so) Tj ET Q BT /F9 10.00 Tf ET q 0 0 0 rg BT 52.50 235.21 Td (DTI Ratio) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 255.21 Td (Ratio of the borrower's total monthly debt payments) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 245.21 Td (to gross monthly income. One indicator of the) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 235.21 Td (creditworthiness of borrowers, as it measures) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 225.21 Td (borrowers' ability to manage monthly payments and) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 137.50 215.21 Td (repay debts.) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 263.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 263.21 Td (Borrowers with lower DTI ratios are generally more likely ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 253.21 Td (to repay their loans than those with higher DTI ratios, ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 243.21 Td (holding all other factors equal) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 337.50 227.21 Td (? Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 227.21 Td (DTI ratios are at the time of origination and may not be ) Tj ET Q BT /F5 10.00 Tf ET q 0 0 0 rg BT 347.50 217.21 Td (indicative of the borrowers' current credit worthiness.) Tj ET Q BT /F2 11.00 Tf ET endstream endobj 211 0 obj <> endobj 212 0 obj <> stream 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 759 m 250 759 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 250 759 m 563 759 l s BT /F6 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 764.07 Td (Management's Discussion and Analysis) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 317.30 764.07 Td (Risk Management |) Tj ET Q BT /F12 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 391.81 764.07 Td ( ) Tj ET Q BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 394.31 764.07 Td (Single-Family Mortgage Credit Risk) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 40 m 237 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 237 40 m 275 40 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 275 40 m 563 40 l s BT /F7 9.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 52.50 30.07 Td (FREDDIE MAC) Tj ET Q BT /F6 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 119.18 30.07 Td ( | 2018 Form 10-K) Tj ET Q BT /F7 9.00 Tf ET q 0.4666666666666667 0.47058823529411764 0.4549019607843137 rg BT 541.45 30.07 Td (101) Tj ET Q BT /F2 11.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 739.15 Td (The tables below contain details on characteristics of the loans in our single-family credit guarantee ) Tj ET Q BT /F2 11.00 Tf ET q 0 0 0 rg BT 49.50 723.75 Td (portfolio.) Tj ET Q BT /F1 11.00 Tf ET q 0 0 0 rg BT 49.50 702.35 Td (Table 24 - Credit Quality Characteristics of Our Single-Family Credit Guarantee Portfolio ) Tj ET Q 0.4666666666666667 0.7411764705882353 0.27058823529411763 rg /GS0 gs 309.00 691.85 254.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 676.85 255.00 -47.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 309.00 676.85 45.00 -47.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 354.00 676.85 39.00 -47.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 393.00 676.85 45.00 -47.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 438.00 676.85 40.00 -47.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 478.00 676.85 45.00 -47.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 523.00 676.85 40.00 -47.00 re f /GS0 gs 0.4666666666666667 0.7411764705882353 0.27058823529411763 rg /GS0 gs 309.00 574.85 254.00 -15.00 re f /GS0 gs 0 0.6509803921568628 0.8862745098039215 rg /GS0 gs 50.00 559.85 255.00 -