Freddie Mac 2009 Annual Report Download - page 60

ITEM 6. SELECTED FINANCIAL DATA
(1)
The selected financial data presented below should be reviewed in conjunction with MD&A and our consolidated
financial statements and related notes for the year ended December 31, 2009.
2009 2008 2007 2006 2005
At or for the Year Ended December 31,
(dollars in millions, except share-related amounts)
Statement of Operations Data
Net interest income . . . ........................................ $ 17,073 $ 6,796 $ 3,099 $ 3,412 $ 4,627
Non-interest income (loss) ....................................... (2,732) (29,175) (275) 1,679 683
Non-interest expense . . ........................................ (36,725) (22,185) (8,813) (2,809) (2,780)
Net income (loss) attributable to Freddie Mac before cumulative effect of change in
accounting principle . ........................................ (21,553) (50,119) (3,094) 2,327 2,172
Cumulative effect of change in accounting principle, net of taxes . . . .......... — — — — (59)
Net income (loss) attributable to Freddie Mac . ......................... (21,553) (50,119) (3,094) 2,327 2,113
Net income (loss) attributable to common stockholders .................... (25,658) (50,795) (3,503) 2,051 1,890
Per common share data:
Earnings (loss) before cumulative effect of change in accounting principle:
Basic . . . ............................................. (7.89) (34.60) (5.37) 3.01 2.82
Diluted . ............................................. (7.89) (34.60) (5.37) 3.00 2.81
Earnings (loss) after cumulative effect of change in accounting principle:
Basic . . . ............................................. (7.89) (34.60) (5.37) 3.01 2.73
Diluted . ............................................. (7.89) (34.60) (5.37) 3.00 2.73
Cash common dividends . . . ................................... — 0.50 1.75 1.91 1.52
Weighted average common shares outstanding (in thousands)
(2)
:
Basic . . . ............................................. 3,253,836 1,468,062 651,881 680,856 691,582
Diluted . ............................................. 3,253,836 1,468,062 651,881 682,664 693,511
Balance Sheet Data
Total assets . . . ............................................. $ 841,784 $ 850,963 $ 794,368 $ 804,910 $ 798,609
Short-term debt . ............................................. 343,975 435,114 295,921 285,264 279,764
Long-term senior debt . ........................................ 435,931 403,402 438,147 452,677 454,627
Long-term subordinated debt . . ................................... 698 4,505 4,489 6,400 5,633
All other liabilities ............................................ 56,808 38,576 28,906 33,139 31,945
Total Freddie Mac stockholders’ equity (deficit) ......................... 4,278 (30,731) 26,724 26,914 25,691
Portfolio Balances
(3)
Total mortgage-related investments portfolio . . ......................... $ 755,272 $ 804,762 $ 720,813 $ 703,959 $ 710,346
Total PCs and Structured Securities issued
(4)
........................... 1,869,882 1,827,238 1,738,833 1,477,023 1,335,524
Total mortgage portfolio ........................................ 2,250,539 2,207,476 2,102,676 1,826,720 1,684,546
Non-performing assets . ........................................ 105,588 48,342 18,446 9,546 10,150
Ratios
Return on average assets
(5)
...................................... (2.5)% (6.1)% (0.4)% 0.3% 0.3%
Non-performing assets ratio
(6)
.................................... 5.3 2.5 1.0 0.6 0.7
Return on common equity
(7)
..................................... N/A N/A (21.0) 9.8 8.1
Return on total Freddie Mac stockholders’ equity
(8)
...................... N/A N/A (11.5) 8.8 7.6
Dividend payout ratio on common stock
(9)
............................ N/A N/A N/A 63.9 56.9
Equity to assets ratio
(10)
........................................ (1.6) (0.2) 3.4 3.3 3.5
Preferred stock to core capital ratio
(11)
............................... N/A N/A 37.3 17.3 13.2
(1) See “NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Recently Adopted Accounting Standards” to our consolidated financial
statements for more information regarding our accounting policies and adjustments made to previously reported results due to changes in accounting
principles. Effective January 1, 2006, we changed our method of estimating prepayments for the purpose of amortizing premiums, discounts and
deferred fees related to certain mortgage-related securities.
(2) Includes the weighted average number of shares during 2008 and 2009 that are associated with the warrant for our common stock issued to Treasury as
part of the Purchase Agreement. This warrant is included in basic earnings per share, because it is unconditionally exercisable by the holder at a cost
of $0.00001 per share.
(3) Represents the unpaid principal balance and excludes mortgage loans and mortgage-related securities traded, but not yet settled. Effective in December
2007, we established trusts for the administration of cash remittances received related to the underlying assets of our PCs and Structured Securities
issued. As a result, for 2008 and 2009, we report the balance of our mortgage portfolios to reflect the publicly-available security balances of our PCs
and Structured Securities. For periods prior to 2008, we report these balances based on the unpaid principal balance of the underlying mortgage loans.
We reflected this change as an increase in the unpaid principal balance of our mortgage-related investments portfolio by $2.8 billion at December 31,
2007.
(4) Includes PCs and Structured Securities that we hold for investment. See “MD&A — OUR PORTFOLIOS — Table 76 — Total Mortgage Portfolio” for
the composition of our total mortgage portfolio. Excludes Structured Securities for which we have resecuritized our PCs and Structured Securities.
These resecuritized securities do not increase our credit-related exposure and consist of single-class Structured Securities backed by PCs, Structured
Securities, and principal-only strips. The notional balances of interest-only strips are excluded because this line item is based on unpaid principal
balance. Includes other guarantees issued that are not in the form of a PC, such as long-term standby commitments and credit enhancements for
multifamily housing revenue bonds.
(5) Ratio computed as net income (loss) attributable to Freddie Mac divided by the simple average of the beginning and ending balances of total assets.
(6) Ratio computed as non-performing assets divided by the ending unpaid principal balances of our total mortgage portfolio, excluding non-Freddie Mac
securities.
(7) Ratio computed as net income (loss) attributable to common stockholders divided by the simple average of the beginning and ending balances of Total
Freddie Mac stockholders’ equity (deficit), net of preferred stock (at redemption value). Ratio is not presented for periods in which the simple average
of the beginning and ending balances of Total Freddie Mac stockholders’ equity (deficit) is less than zero.
(8) Ratio computed as net income (loss) attributable to Freddie Mac divided by the simple average of the beginning and ending balances of Total Freddie
Mac stockholders’ equity (deficit). Ratio is not presented for periods in which the simple average of the beginning and ending balances of Total
Freddie Mac stockholders’ equity (deficit) is less than zero.
(9) Ratio computed as common stock dividends declared divided by net income (loss) attributable to common stockholders. Ratio is not presented for
periods in which net income (loss) attributable to common stockholders was a loss.
(10) Ratio computed as the simple average of the beginning and ending balances of Total Freddie Mac stockholders’ equity (deficit) divided by the simple
average of the beginning and ending balances of total assets.
(11) Ratio computed as preferred stock (excluding senior preferred stock), at redemption value divided by core capital. Senior preferred stock does not meet
the statutory definition of core capital. Ratio is not presented for periods in which core capital is less than zero. See “NOTE 11: REGULATORY
CAPITAL” to our consolidated financial statements for more information regarding core capital.
57 Freddie Mac