Freddie Mac 2004 Annual Report Download - page 3

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TO OUR STOCKHOLDERS:
I am pleased to write you this second annual letter as Chairman and CEO of Freddie Mac —
the first covering developments under the company’s new leadership team.
What began as a triage year became a year of mounting progress. By the end of 2004, our
steps forward had begun to build real momentum. While we still have many challenges, I feel
good about where we are and where we’re going.
Our progress has come in three phases. First, we acted to repair the company’s accounting,
reputation and key relationships. Second, we laid a strong organizational foundation for the
future. This has meant putting in place a tested and
talented senior management team and reorganizing
the company to be more agile, control costs and
move toward operating excellence. Third, we are
taking specific steps to build on this foundation,
fulfill our vital public mission and produce lasting
value for our shareholders.
Freddie Mac’s employees are highly able, loyal and
committed to our mission. The key is providing the
right kind of leadership and sense of urgency.
PUTTING OUR HOUSE IN ORDER
While much remains to be done, Freddie Mac made
significant strides last year in putting our house in
order. We met all our financial reporting targets. We
continued to modernize and strengthen our internal
controls. In March of this year, we met our important
commitment to report 2004 results. And we are on
track to become fully current early next year.
We have also taken steps to strengthen corporate
governance. For example, we have conducted the
orderly transition of more than half of our elected
board. In an era when many companies have had
a hard time with board recruiting, the high quality of our board is a heartening sign of strong
leadership and oversight for Freddie Mac.
FULFILLING OUR MISSION
Freddie Mac’s mission is to provide liquidity, stability and affordability to the housing market. On
the first two, we have done a good job. Mortgage money has been widely available under a wide
range of market conditions, and the GSEs have played a vital role in keeping the economy
strong. On affordability, however, I have been “Johnny One-Note” about Freddie Mac’s need to
do more. This is an area where we face substantial legislative and regulatory challenges. And the
company has responded.