The sharp drop in cash in Q1 2024 was primarily due to the **repayment of outstanding debt** and the **investment of retained earnings**.  **[0001026214-24-000039_fmcc-20240331.htm:6]** **[0001026214-24-000039_fmcc-20240331.htm:24]** 

What factors led to the sharp drop in cash in Q1 2024?

The increase in Q4 2024 debt was primarily driven by a rise in the **Debt of Consolidated Trusts**—which grew by **$81,014 million** (from **$3,041,927 million** to **$3,122,941 million**) due to ongoing securitization activities—and an increase in **Freddie Mac's Own Debt**. The latter saw significant growth in **Short-term Debt** (an increase of **$8,699 million**, from **$5,976 million** to **$14,675 million**) and **Long-term Debt** (an increase of **$6,890 million**, from **$160,443 million** to **$167,333 million**), reflecting higher funding needs for its operations and investments.  **[0001026214-25-000040_fmcc-20241231.htm:242]** **[0001026214-25-000040_fmcc-20241231.htm:104]** 

What drove the increase in debt in Q4 2024?

The elevated total assets in Q4 2024 were primarily driven by the expansion of Freddie Mac’s mortgage portfolio and related investment activities. Specifically, the **Mortgage Loans Held-for-Investment** increased significantly (from **$3,083,665 million** to **$3,172,329 million**), which was the largest contributing factor. Additionally, there were increases in **Securities Purchased Under Agreements to Resell** (from **$95,148 million** to **$100,118 million**), **Investment Securities** (from **$43,275 million** to **$55,771 million**), and **Accrued Interest Receivable** (from **$9,925 million** to **$11,029 million**). These gains were partially offset by a decline in **Cash and Cash Equivalents** (from **$6,019 million** to **$5,534 million**) but still contributed overall to a higher total asset base of **$3,386,692 million in Q4 2024** compared to **$3,280,976 million in Q4 2023**.  **[0001026214-25-000041_a20244qerexhibit991.htm:1]** **[0001026214-25-000040_fmcc-20241231.htm:189]** 

What contributed to the elevated total assets in Q4 2024?

f5cfadb63233fe21abdb0ee5390377d166de14b715bf55b2850612280525412c

The documents do not provide specific details explaining why the operating cash flow was high in Q3 2024. However, they do note that operating cash flows can vary due to factors such as variations in net income, adjustments for non-cash items, and changes in working capital.  **[0001026214-24-000097_fmcc-20240930.htm:40]** **[0001026214-24-000068_fmcc-20240630.htm:39]** 

Why was Operating Cash Flow so high in Q3 2024?

Freddie Mac’s operating cash flow in Q4 2024 was negative due to a combination of factors. These include a notable change in the provision for credit losses—from a benefit in prior periods to an expense in 2024—which reduced cash flows, along with significant non‐cash adjustments from higher net investment gains that were subtracted in the operating activities reconciliation. In addition, changes in working capital (such as variations in accrued interest receivable and payable) and a substantial net cash outflow related to mortgage loans held-for-sale further contributed to the negative result. Note that while these factors explain the broader changes in operating cash flows, the documents do not provide a detailed Q4 breakdown for the exact impact of each factor.  **[0001026214-25-000040_fmcc-20241231.htm:191]** **[0001026214-25-000041_a20244qerexhibit991.htm:1]** 

Why was Operating Cash Flow negative in Q4 2024?

Investing activities were so low in Q3 2024 primarily due to several factors. **Purchases of mortgage loans acquired held-for-investment increased significantly to **$(101,439) million** compared to **$(77,032) million**, creating a larger cash outflow. Additionally, there were **increased advances under secured lending arrangements** at **$(77,138) million** versus **$(74,579) million**, which further contributed to the negative cash flow. Furthermore, activity in investment securities was lower with both **decreased purchases** and **reduced proceeds from sales**. These factors combined led to the significant decline in net cash provided by investing activities in Q3 2024.  **[0001026214-24-000097_fmcc-20240930.htm:40]** 

Why were Investing Activities so low in Q3 2024?

Financing activities turned positive in Q4 2024 because Freddie Mac significantly improved its financing transactions. **Proceeds from debt issuance increased**, both in the debt of consolidated trusts (rising from **$205,523 million** in 2023 to **$253,894 million** in 2024) and in the debt of Freddie Mac (increasing from **$146,506 million** to **$207,529 million**), while **repayments decreased** (with consolidated trusts’ repayments shifting from **$(251,762) million** to **$(282,087) million** and Freddie Mac’s from **$(150,585) million** to **$(194,038) million**). Additionally, the net change from securities sold under agreements to repurchase had a smaller negative effect. These changes combined to reverse the previous outflow, leading to a positive net cash flow in financing activities for Q4 2024.  **[0001026214-25-000040_fmcc-20241231.htm:191]** 

Why did Financing Activities turn positive in Q4 2024?

beb0627a494df5f0f06a2a8f2dc2e925ec8fe3ce5d2ea222b3d15b54c0cae25c

Freddie Mac's **Investment gains, net** were significantly high in Q4 2024, reaching **$879 million**, primarily because the increase in net investment gains substantially bolstered their overall non‐interest income during the quarter.  **[0001026214-25-000041_a20244qerexhibit991.htm:1]** **[0001026214-25-000041_a20244qerexhibit991.htm:7]** 

Why was Investment gains, net so high in Q4 2024?

The documents do not provide a definitive explanation for why the Other expense flipped to a positive number in Q4 2024. They note that for the full year 2024, the reduction was largely due to the absence of a **$313 million expense accrual for an adverse judgment at trial in 2023**, but for Q4 specifically, no additional details were provided to explain this quarterly change.  **[0001026214-25-000040_fmcc-20241231.htm:20]** **[0001026214-25-000041_a20244qerexhibit991.htm:7]** 

What caused Other expense to flip to a positive amount in Q4 2024?

Freddie Mac’s surge in **non-interest income** for **Q4 2024** was driven by a combination of factors. The increase was largely due to **higher net investment gains**, which stemmed from gains on sales of mortgage loans, **lower realized losses** on sales of available-for-sale securities, and additional net investment gains. Furthermore, **favorable interest-rate risk management activities** and effective hedging strategies greatly contributed to the strong performance in this period.  **[0001026214-25-000041_a20244qerexhibit991.htm:1]** **[0001026214-25-000040_fmcc-20241231.htm:18]** 

What factors contributed to the surge in Non-interest income in Q4 2024?

The documents do not provide specific details on why the Q4 2024 guarantee income was notably lower, with one document noting that even though the quarterly figure is lower, the full-year guarantee income remained relatively stable (**$1,611 million** in 2024 versus **$1,615 million** in 2023).  **[0001026214-25-000040_fmcc-20241231.htm:18]** 

Why was Guarantee income notably lower in Q4 2024?

d87e2d9e9e5f705868a0920f891297089db42700447ce94c7c03a99bca5347ef

Interest income (USD, millions)

Interest expense (USD, millions)

Net interest income (USD, millions)

Guarantee income (USD, millions)

Investment gains, net (USD, millions)

Other income (USD, millions)

Non-interest income (USD, millions)

Net revenues (USD, millions)

(Provision) benefit for credit losses (USD, millions)

Salaries and employee benefits (USD, millions)

Professional services, technology, and occupancy (USD, millions)

Credit enhancement expense (USD, millions)

Legislative and regulatory assessments (USD, millions)

Other expense (USD, millions)

Non-interest expense (USD, millions)

Income before income tax expense (USD, millions)

Income tax expense (USD, millions)

Net income (USD, millions)

Other comprehensive income (loss), net of taxes and reclassification adjustments (USD, millions)

Comprehensive income (USD, millions)

c7bf4ef2432f66069d0bc57f8ca16031e60ef5d76a7b46e8bbb4664d270d2873

Net Cash Provided by (Used in) Operating Activities (USD, millions)

Purchases of Investment Securities (USD, millions)

Proceeds from Sales of Investment Securities (USD, millions)

Proceeds from Maturities and Repayments of Investment Securities (USD, millions)

Purchases of Mortgage Loans Acquired Held-For-Investment (USD, millions)

Proceeds from Sales of Mortgage Loans Acquired Held-For-Investment (USD, millions)

Proceeds from Repayments of Mortgage Loans Acquired Held-For-Investment (USD, millions)

Advances Under Secured Lending Arrangements (USD, millions)

Net (Increase) Decrease in Securities Purchased Under Agreements to Resell (USD, millions)

Cash Flows Related to Derivatives (USD, millions)

Other, Net from Investing Activities (USD, millions)

Net Cash Provided by (Used in) Investing Activities (USD, millions)

Proceeds from Issuance of Debt of Consolidated Trusts (USD, millions)

Repayments and Redemptions of Debt of Consolidated Trusts (USD, millions)

Proceeds from Issuance of Debt of Freddie Mac (USD, millions)

Repayments of Debt of Freddie Mac (USD, millions)

Net Increase (Decrease) in Securities Sold Under Agreements to Repurchase (USD, millions)

Other, Net from Financing Activities (USD, millions)

Net Cash Provided by (Used in) Financing Activities (USD, millions)

Net Increase (Decrease) in Cash and Cash Equivalents (USD, millions)

Cash Paid for Debt Interest (USD, millions)

Cash Paid for Income Taxes (USD, millions)

Cash and Cash Equivalents at the Beginning of Year (USD, millions)

Cash and Cash Equivalents at End of Period (USD, millions)

0bcec74602bafbd1398d23449ca127fa2d987d328d2b6f9a52fdbd800bd83f38

Cash and cash equivalents (USD, millions)

Securities purchased under agreements to resell (USD, millions)

Investment securities, at fair value (USD, millions)

Mortgage loans held-for-sale (USD, millions)

Mortgage loans held-for-investment (USD, millions)

Accrued interest receivable (USD, millions)

Deferred tax assets, net (USD, millions)

Other assets (USD, millions)

Total assets (USD, millions)

Accrued interest payable (USD, millions)

Debt (USD, millions)

Other liabilities (USD, millions)

Total liabilities (USD, millions)

Senior preferred stock (USD, millions)

Preferred stock, at redemption value (USD, millions)

Retained earnings (USD, millions)

AOCI, net of taxes (USD, millions)

Treasury stock, at cost (USD, millions)

Total equity (USD, millions)

Total liabilities and equity (USD, millions)

e90c9a548f79a1bc4208aa22988f74537ddf08e502d378f382766296c3e0080d

5207030557e7272415763135b0fbbbf742b4d2e63b6cb2ece2de91f039120a58

43fcfba5552f1752b0481ba5e79b1f4219daa543f0b8d9f75b52661f2b7c133c

Proceeds from / Repayments of Debt (USD, millions)

Net Change in Cash (USD, millions)

089c2882ab5e1ea6c15276150ec5df88c6450773c64c6e8a119d51f18d4d97c4

Single-Family

- Net Interest Income

- Non-Interest Income

Multifamily

Capital Markets

Segment Earnings (Net of Taxes)

:--------------------------------

Single-family Guarantee

Investments

All Other

Total Segment Earnings

Total Revenue

fc456668be1a8322cfb2761f6fbd2732a270dd12edcb8c6fa4a27e20b312cd68

FEDERAL HOME LOAN MORTGAGE (FMCC)

Financials