Q1 2024 Earnings Summary
Reported on May 1, 2024 (Before Market Open)
Pre-Earnings Price$1.36Last close (Apr 30, 2024)
Post-Earnings Price$1.38Open (May 1, 2024)
Price Change
$0.02(+1.47%)
- Strong Financial Performance: Freddie Mac reported net income of $2.8 billion, an increase of $771 million or 39% year-over-year. The Single-Family segment net income was $1.9 billion, up 16% year-over-year , and the Multifamily segment net income was $821 million, up $503 million from the prior year quarter.
- Growth in New Business Activity and Portfolios: Total new business activity was $62 billion this quarter, slightly up from $59 billion in 1Q 2023. Multifamily new business activity was $9 billion for the first quarter, up 50% from a year ago. The Single-Family mortgage portfolio grew 2% to $3 trillion , and the Multifamily mortgage portfolio increased 4% year-over-year to $443 billion.
- Focus on Affordable Housing and Strong Credit Quality: Freddie Mac supported affordable housing by providing financing where 90% of rental homes were affordable to low and moderate-income families , and 52% of new Single-Family home purchase loans went to first-time homebuyers—a new high. The Single-Family portfolio has strong credit characteristics, with a weighted average current loan-to-value ratio of 52% and a weighted average current credit score of 754. The Single-Family serious delinquency rate declined to 52 basis points, down 10 basis points from 1Q 2023.
- Multifamily delinquency rate increased significantly to 34 basis points, up 21 basis points from 13 basis points at the end of March 2023, primarily driven by delinquencies in floating rate loans and small business loans portfolio.
- House price forecast has been revised downward, expecting only a 0.2% increase over the next 12 months and 0.6% over the subsequent 12 months, down from previous forecasts of 2.8% and 2% growth, respectively.
- Provision for credit losses remains an expense, with a total provision of $181 million this quarter due to modest credit reserve builds in both business segments, indicating potential concerns about credit quality.
Research analysts covering FEDERAL HOME LOAN MORTGAGE.