Freddie Mac 2011 Annual Report Download - page 261

debt securities of consolidated trusts held by third parties. We also cannot become liable for any subordinated
indebtedness without the prior consent of Treasury.
Our debt cap under the Purchase Agreement was $972.0 billion in 2011 and declined to $874.8 billion on January 1,
2012. As of December 31, 2011, we estimate that the par value of our aggregate indebtedness totaled $674.3 billion,
which was approximately $297.7 billion below the applicable debt cap. Our aggregate indebtedness is calculated as the
par value of other debt.
In the tables below, the categories of short-term debt (due within one year) and long-term debt (due after one year)
are based on the original contractual maturity of the debt instruments classified as other debt.
The table below summarizes the interest expense and the balances of total debt, net per our consolidated balance
sheets.
Table 8.1 — Total Debt, Net
2011 2010 2009 December 31, 2011 December 31, 2010
Interest Expense For The
Year Ended December 31, Balance, Net
(1)
(in millions) (in millions)
Other debt:
Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 331 $ 552 $ 2,234 $ 161,399 $ 197,106
Long-term debt:
Senior debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,505 16,317 19,754 498,779 516,123
Subordinated debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 46 162 368 711
Total long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,538 16,363 19,916 499,147 516,834
Total other debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,869 16,915 22,150 660,546 713,940
Debt securities of consolidated trusts held by third parties . . . . . . . . . 67,119 75,216 — 1,471,437 1,528,648
Total debt, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $79,988 $92,131 $22,150 $2,131,983 $2,242,588
(1) Represents par value, net of associated discounts, premiums, and hedge-related basis adjustments, with $0.2 billion and $0.9 billion, respectively, of
other short-term debt, and $2.8 billion and $3.6 billion, respectively, of other long-term debt that represents the fair value of debt securities with the
fair value option elected at December 31, 2011 and 2010.
During 2011, 2010, and 2009, we recognized fair value gains (losses) of $91 million, $581 million, and
$(405) million, respectively, on our foreign-currency denominated debt, of which $40 million, $461 million, and
$(209) million, respectively, are gains (losses) related to our net foreign-currency translation.
Other Short-Term Debt
As indicated in “Table 8.2 — Other Short-Term Debt”, a majority of other short-term debt consisted of Reference
Bills»securities and discount notes, paying only principal at maturity. Reference Bills»securities, discount notes, and
medium-term notes are unsecured general corporate obligations. Certain medium-term notes that have original maturities
of one year or less are classified as other short-term debt.
The table below summarizes the balances and effective interest rates for other short-term debt.
Table 8.2 — Other Short-Term Debt
Par Value Balance, Net
(1)
Weighted
Average
Effective Rate
(2)
Par Value Balance, Net
(1)
Weighted
Average
Effective Rate
(2)
December 31, 2011 December 31, 2010
(dollars in millions)
Reference Bills»securities and discount notes . . . . $161,193 $161,149 0.11% $194,875 $194,742 0.24%
Medium-term notes . . . . . . . . . . . . . . . . . . . . . . 250 250 0.24 2,364 2,364 0.31
Other short-term debt . . . . . . . . . . . . . . . . . . . $161,443 $161,399 0.11 $197,239 $197,106 0.25
(1) Represents par value, net of associated discounts and premiums.
(2) Represents the weighted average effective rate that remains constant over the life of the instrument, which includes the amortization of discounts or
premiums and issuance costs.
Federal Funds Purchased and Securities Sold Under Agreements to Repurchase
Securities sold under agreements to repurchase are effectively collateralized borrowing transactions where we sell
securities with an agreement to repurchase such securities. These agreements require the underlying securities to be
delivered to the dealers who are the counterparties to the transactions. Federal funds purchased are unsecuritized
borrowings from commercial banks that are members of the Federal Reserve System. At both December 31, 2011 and
2010, we had no balances in federal funds purchased and securities sold under agreements to repurchase.
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