trending Market Intelligence /marketintelligence/en/news-insights/trending/nkuy0nmqpcrloo1k0wtceg2 content esgSubNav
In This List

Freddie Mac issues $880M notes under credit risk transfer program

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


Freddie Mac issues $880M notes under credit risk transfer program

Freddie Mac has settled an $880 million transaction of structured agency credit risk, or STACR, 2018-HRP-1 notes.

The notes, which aim to further reduce mortgage credit risk, represent the company's first transaction under its STACR program, in which the notes are issued by a special purpose trust rather than as Freddie Mac.

Pricing for the notes includes three classes: the M-2 class, which has one-month London Interbank Offered Rate plus a spread of 165 basis points; the B-1 class, which has one-month LIBOR plus a spread of 375 basis points; and the B-2 class, which has one-month LIBOR plus a spread of 1,175 basis points.

STACR 2018-HRP-1 has a reference pool of single-family mortgages with an unpaid principal balance of about $29 billion, consisting of a subset of fixed-rate, single-family mortgages with an original term of 241 to 360 months funded by Freddie Mac between Jan. 1, 2012, and March 31, 2013. The reference pool includes loans refinanced under Freddie Mac's relief refinance program with estimated loan-to-value ratios greater than 60% and less than 200% or if the loan does not have an estimated loan-to-value ratio, original loan-to-value ratios greater than 80% and less than 200%.

Bank of America Merrill Lynch and Barclays Capital Inc. are co-lead managers and joint book runners in the offering.