Freddie Mac 2015 Annual Report Download - page 82

Management's Discussion and Analysis Our Business Segments | Investments
Freddie Mac 2015 Form 10-K 80
Debt Composition
Contractual Maturity Date as of December 31,
2015
Earliest Call Date as of December 31, 2015
Commentary
• As our long-term debt spreads remained high in 2015, we continued to rely on short-term and
medium-term debt issuances to fund our business. Short-term debt as a percentage of total other
debt has remained relatively flat at 41.3% in 2015, down 1.3% and 1.5% from 2014 and 2013,
respectively.
• Our short-term debt issuances provide us with overall lower funding costs relative to longer-term debt
and greater flexibility as we reduce our mortgage-related investments portfolio. However, in recent
years, we have witnessed a significant increase in FHLB short-term debt issuances and outstanding
balances. Increased competition from the FHLBs with respect to short-term debt issuances may have
caused our short-term debt spreads to increase during the last quarter of 2015.
• During 2015, spreads on our callable debt were favorable relative to our non-callable medium-term
and long-term debt. Furthermore, our callable debt provides us with flexibility in the event that our
liquidity condition changes. As a result, we issued more callable debt during 2015 compared to 2014.
As of December 31, 2015, $93 billion of the outstanding $108 billion of callable debt may be called in
2016.