Freddie Mac 2004 Annual Report Download - page 184
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Recognized GAs Ì Guarantee Fee-Related Cash Flows
Freddie Mac recorded $1,086 million, $891 million and $771 million of income associated with
guarantee-related cash Öows received during 2004, 2003 and 2002, respectively. These amounts were recorded
as Management and guarantee income. Of such amounts, approximately $257 million, $244 million and
$242 million, respectively, related to imputed interest. The remaining portion related to return of principal,
which totaled $829 million, $647 million and $529 million for 2004, 2003 and 2002, respectively.
Recognized GAs Ì All Cash Flows
As noted above, Freddie Mac discontinued the inclusion of credit enhancements as a component of
recognized GAs eÅective January 1, 2003. As a result, imputed interest amounts reported above for 2004 and
2003 do not consider cash Öows received that relate to credit enhancements that were previously recorded as a
component of recognized GAs. With respect to amounts reported in 2002, Freddie Mac recorded total income
of $820 million associated with recognized GAs. Approximately $259 million of such amounts constitute
imputed interest, while the remaining portion, which totaled $561 million, related to return of principal for
2002.
Recognized PC Residuals
Freddie Mac recorded $524 million, $449 million and $325 million of income associated with guarantee-
related cash Öows received in connection with the GA component of recognized PC residuals during 2004,
2003 and 2002, respectively. These amounts were recorded as interest income. Of these amounts, approxi-
mately $117 million, $109 million and $96 million during 2004, 2003 and 2002, respectively, related to
imputed interest. The remaining portion related to return of principal, which totaled $407 million, $340 million
and $229 million during 2004, 2003 and 2002, respectively.
Considering all cash Öows related to recognized PC residuals (i.e., related to both the GA and GO
components of recognized PC residuals), the amount of imputed interest on PC residuals was approximately
$67 million, $66 million and $73 million during 2004, 2003 and 2002, respectively. Consistent with the
description above, however, cash Öows used to derive the imputed interest for 2004 and 2003 were exclusive of
proceeds received in connection with credit enhancements.
Freddie Mac
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