Freddie Mac 2015 Annual Report Download - page 366

Executive Compensation Compensation Discussion and Analysis
Freddie Mac 2015 Form 10-K 364
Donald H. Layton Chief Executive Officer
Performance Highlights:
Continued increasing the strength and capability of the management team through internal promotions and external hires,
resulting in a total of 17 new officers in 2015, including his personal recruitment of a new Chief Enterprise Risk Officer.
Continued leadership by the company in credit risk transfer through increased volumes and new transaction structures is
transforming how a significant portion of U.S. mortgages are funded. This reduces taxpayer exposure to mortgage risk in both
the single-family and multifamily businesses.
Supervised the continuing, rapid and efficient reduction in the risk of legacy assets. Most noteworthy in 2015 was the 30%
decline in the single-family seriously delinquent rate to 1.32% from 1.88%, plus $2.9 billion of non-performing loan sales.
Guided the company to strengthened competitiveness, which is reflected in increased market share in both the single-family
and multifamily businesses. Multifamily, in particular, had a record volume year.
The company exceeded or achieved the vast majority of the objectives in the Corporate Scorecard.
At-Risk Deferred Salary (Corporate Scorecard/Individual) Funding Decision:
The Compensation Committee determined that Mr. Layton should receive 100% of his At-Risk Deferred Salary that was subject
to reduction based on the company’s performance against the Corporate Scorecard and his individual performance.
James G. Mackey Executive Vice President and Chief Financial Officer
Performance Highlights:
Substantial modifications to the internal financial management information systems resulting in improved internal management
reporting and analysis to support better decision-making.
Engineered significant process simplification programs in the Finance Division throughout the year, including a full three lines
of defense risk management assessment and implementation.
Updated external reporting, including a redesigned earnings release and a simpler 10-K, which has been condensed by over
20%, providing improved investor usability.
Major reorganization of the Finance Division to reduce expenses and improve communication timeliness and efficiency, with a
reduction in organizational layers by 25% and an increased span of control by 38%.
Strong leadership in the development of management talent in the Finance Division, including the implementation of a job
rotation program for key personnel.
At-Risk Deferred Salary (Corporate Scorecard/Individual) Funding Decision:
The Compensation Committee determined that Mr. Mackey should receive 100% of his At-Risk Deferred Salary that was subject
to reduction based on the company’s performance against the Corporate Scorecard and his individual performance.
Michael T. Hutchins Executive Vice President Investments and Capital Markets
Performance Highlights:
Strong leadership of the Investments and Capital Markets Division led to the achievement of several critical milestones,
including the reduction of legacy assets in value-accretive transactions, including sales of $2.9 billion of non-performing loans
and $11.4 billion of private-label securities, as well as the securitization of $8.2 billion of reperforming loans.
Partnered with the Single-Family Business to improve the market penetration of cash purchases of single-family mortgages,
which accounted for 35% of single-family volume in 2015, an increase from 29% in 2014.
Continued to enhance the liquidity of the company’s Agency residential mortgage-related securities in the secondary market.
Continued to focus on risk management, maintaining economic interest-rate risk at modeled low levels, efficiently managing
the company’s liquidity and funding needs as well as strengthening capital markets operational processes.
Exceeded the 2015 reduction targets specified in the Purchase Agreement and the FHFA-approved Retained Portfolio Plan for
decreasing the size of the retained portfolio.
At-Risk Deferred Salary (Corporate Scorecard/Individual) Funding Decision:
The Compensation Committee determined that Mr. Hutchins should receive 100% of his At-Risk Deferred Salary that was subject
to reduction based on the company’s performance against the Corporate Scorecard and his individual performance.