Freddie Mac Announces K-705 Offering of K Certificates Backed Only by 7-Year Multifamily Mortgages

MCLEAN, Va., Jan. 17, 2012 /PRNewswire/ -- Freddie Mac (OTC: FMCC) today announced its fifth offering of Structured Pass-Through Certificates ("K Certificates") backed exclusively by multifamily mortgages with a 7-year term.  The company expects to offer approximately $1.0 billion in K Certificates ("K-705 Certificates"), which are expected to price the week of January 16, 2012, and settle on or about February 7, 2012. 

The K-705 Certificates will be offered to the market by a syndicate of dealers led by Credit Suisse Securities (USA) LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated as co-lead managers and joint bookrunners for the transaction.  Barclays Capital Inc., CastleOak Securities, L.P., Jefferies & Company, Inc., and J.P. Morgan Securities LLC will serve as co-managers for the transaction. The K-705 Certificates are backed by 70 recently-originated multifamily mortgages and are guaranteed by Freddie Mac. Rating agencies Fitch, Inc. and Moody's Investors Service, Inc. have been engaged to rate the three senior classes of K-705 Certificates, which are each expected to receive a rating of "AAA(sf)"  and "Aaa(sf)", respectively, subject to on-going monitoring.  

"This is our first K-Deal offering of the year," said Mitch Resnick, co-head of Multifamily Capital Markets for Freddie Mac.  "In 2011, we were one of the top issuers in the CMBS market with 12 K-Deals, representing almost $14 billion in securities. We expect to issue at least as many deals in 2012 as our program continues to grow."

Freddie Mac is a leading issuer of agency-guaranteed structured multifamily. They feature a wide range of investor options with stable cash flows and a structured credit enhancement. K-deals include guaranteed senior and interest only classes. The preliminary offering circular supplement relating to the K-705 Certificates can be found at  http://www.freddiemac.com/mbs/data/k705oc.pdf

Freddie Mac also has a new online tool for investors and analysts, Multifamily Securities Investor Access. This is a central database that houses all post-securitization data from Investor Reporting Packages to help investors and analysts monitor the performance and credit quality of their investments.

This announcement is not an offer to sell any Freddie Mac securities. Offers for any given security are made only through applicable offering circulars and related supplements, which incorporate Freddie Mac's Annual Report on Form 10-K for the year ended December 31, 2010, filed with the Securities and Exchange Commission ("SEC") on February 24, 2011, and all documents that Freddie Mac files with the SEC pursuant to Sections 13(a), 13(c) or 14 of the Securities Exchange Act of 1934, excluding any information "furnished" to the SEC on Form 8-K.

Freddie Mac's press releases sometimes contain forward-looking statements.  A description of factors that could cause actual results to differ materially from the expectations expressed in these and other forward-looking statements can be found in the company's Annual Report on Form 10-K for the year ended December 31, 2010 and its reports on Form 10-Q and Form 8-K, filed with the SEC and available on the Investor Relations page of the company's Web site at www.FreddieMac.com/investors and the SEC's Web site at www.sec.gov.

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters. www.FreddieMac.com

SOURCE Freddie Mac

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