Freddie Mac 2009 Annual Report Download - page 322

QUARTERLY SELECTED FINANCIAL DATA
As Previously Reported: 1Q 2Q 3Q
2009
(in millions,
except share-related amounts)
Net interest income . . ............................................ $ 3,859 $ 4,255 $ 4,462
Non-interest income (loss) . . . ...................................... (3,088) 3,215 (1,082)
Provision for credit losses . . . ...................................... (8,791) (5,199) (7,577)
All other non-interest expense . ...................................... (2,768) (1,688) (965)
Income tax benefit (expense) . ...................................... 937 184 149
Net (income) loss attributable to noncontrolling interests. . ................... — 1 1
Net income (loss) attributable to Freddie Mac . . . . ........................ $ (9,851) $ 768 $ (5,012)
Net loss attributable to common stockholders . . . . ........................ $(10,229) $ (374) $ (6,305)
Loss per common share
(1)
Basic . . . ................................................... $ (3.14) $ (0.11) $ (1.94)
Diluted. . ................................................... $ (3.14) $ (0.11) $ (1.94)
As Adjusted:
(2)
1Q 2Q 3Q 4Q Full-Year
2009
(in millions, except share-related amounts)
Net interest income . . ............................................ $ 3,859 $ 4,255 $ 4,462 $ 4,497 $ 17,073
Non-interest income (loss) . . . ...................................... (3,088) 3,215 (1,082) (1,777) (2,732)
Provision for credit losses
(2)
........................................ (8,915) (5,665) (7,973) (6,977) (29,530)
All other non-interest expense . ...................................... (2,768) (1,688) (965) (1,774) (7,195)
Income tax benefit (expense) . ...................................... 937 184 149 (440) 830
Net (income) loss attributable to noncontrolling interests. . ................... — 1 1 (1) 1
Net income (loss) attributable to Freddie Mac
(2)
.......................... $ (9,975) $ 302 $ (5,408) $ (6,472) $(21,553)
Net loss attributable to common stockholders
(2)
........................... $(10,353) $ (840) $ (6,701) $ (7,764) $(25,658)
Loss per common share
(1)(3)
Basic . . . ................................................... $ (3.18) $ (0.26) $ (2.06) $ (2.39) $ (7.89)
Diluted. . ................................................... $ (3.18) $ (0.26) $ (2.06) $ (2.39) $ (7.89)
1Q 2Q 3Q 4Q Full-Year
2008
(in millions, except share-related amounts)
Net interest income . . ............................................ $ 798 $1,529 $ 1,844 $ 2,625 $ 6,796
Non-interest income (loss) . . . ...................................... 614 56 (11,403) (18,442) (29,175)
Provision for credit losses . . . ...................................... (1,240) (2,537) (5,702) (6,953) (16,432)
All other non-interest expense . ...................................... (743) (897) (2,064) (2,049) (5,753)
Income tax benefit (expense) . ...................................... 422 1,030 (7,970) 966 (5,552)
Net (income) loss attributable to noncontrolling interests. . ................... (2) (2) — 1 (3)
Net loss attributable to Freddie Mac . . ................................ $ (151) $ (821) $(25,295) $(23,852) $(50,119)
Net loss attributable to common stockholders . . . . ........................ $ (424) $(1,053) $(25,301) $(24,017) $(50,795)
Loss per common share:
(1)
Basic . . . ................................................... $ (0.66) $ (1.63) $ (19.44) $ (7.37) $ (34.60)
Diluted. . ................................................... $ (0.66) $ (1.63) $ (19.44) $ (7.37) $ (34.60)
(1) Earnings (loss) per common share is computed independently for each of the quarters presented. Due to the use of weighted average common shares
outstanding when calculating earnings (loss) per share, the sum of the four quarters may not equal the full-year amount. Earnings (loss) per common
share amounts may not recalculate using the amounts in this table due to rounding.
(2) During the fourth quarter of 2009, we identified two errors in loss severity rate inputs used by our models to estimate our single-family loan loss
reserves. These errors affected amounts previously reported. We have concluded that while these errors are not material to our previously issued
consolidated financial statements for the first three quarters of 2009 or to our consolidated financial statements for the full year 2009, the cumulative
impact of correcting these errors in the fourth quarter would have been material to the fourth quarter of 2009. We revised our previously reported results
for the first three quarters of 2009 to correct these errors in the appropriate quarterly period. These revisions resulted in a net increase to provision for
credit losses in the amounts of $124 million, $466 million and $396 million for the first, second and third quarters of 2009, respectively, within non-
interest expense, which correspondingly decreased net income (loss) attributable to Freddie Mac on our consolidated statements of income. We did not
recognize income tax benefit on these errors as we have a valuation allowance recorded against our net deferred tax assets. We will appropriately revise
the 2009 results in each of our quarterly filings on Form 10-Q when next presented throughout 2010. See “CONTROLS AND PROCEDURES —
Changes to Internal Control Over Financial Reporting During the Quarter Ended December 31, 2009 — Identification and Remediation of Material
Weakness — Provision for Credit Losses on Certain Structured Transactions” for additional information regarding our identification and remediation of
a material weakness relating to the calculation of our provision for credit losses during the quarter ended December 31, 2009.
(3) We revised our previously reported 2009 quarterly basic and diluted earnings per share in the fourth quarter of 2009 to reflect the adjustments described
in endnote (2) above, in the appropriate quarterly period. These adjustments resulted in a net decrease to basic and diluted earnings per share in the
amounts of $0.04, $0.15 and $0.12 for the first, second and third quarters of 2009, respectively. We will appropriately revise the 2009 earnings per share
in each of our quarterly filings on Form 10-Q when next presented throughout 2010.
319 Freddie Mac