Freddie Mac Offering $1 Billion in Multifamily Securities

MCLEAN, VA - Freddie Mac announced a new offering of Structured Pass-Through Certificates ("K Certificates"), multifamily mortgage-backed securities.  The company expects to offer approximately $1.0 billion in K Certificates ("K-015 Certificates"), which are expected to price this week or the week of October 24, 2011, and settle on or about November 9, 2011.  

The K-015 Certificates will be offered to the market by a syndicate of dealers led by Wells Fargo Securities, LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated as co-lead managers and joint bookrunners for the transaction. Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Morgan Stanley & Co. LLC will serve as co-managers for the transaction. The K-015 Certificates include two classes of senior principal and interest classes, a senior interest only class and a junior interest only class.  A new feature of this offering is that Fitch, Inc. and DBRS, Inc. have been engaged to rate the three senior classes of K-015 Certificates, which are expected to receive ratings of "AAA(sf)" from each agency, subject to on-going monitoring.  

The K-015 Certificates are backed by 91 recently-originated multifamily mortgages and are guaranteed by Freddie Mac.  This is the tenth K Certificate offering this year. K Certificates provide Freddie Mac with an efficient vehicle to securitize multifamily loans. The certificates provide investors with stable cash flows, structured credit enhancement and the Freddie Mac guarantee.  

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.