Freddie Mac 2012 Annual Report Download - page 113

Multifamily
The table below presents the Segment Earnings of our Multifamily segment.
Table 20 — Segment Earnings and Key Metrics — Multifamily(1)
Year Ended December 31,
2012 2011 2010
Segment Earnings:
Net interest income ................................................................ $ 1,291 $ 1,200 $ 1,114
(Provision) benefit for credit losses ..................................................... 123 196 (99)
Non-interest income:
Management and guarantee income ................................................... 151 127 101
Net impairment of available-for-sale securities recognized in earnings .......................... (123) (353) (96)
Gains (losses) on sale of mortgage loans ............................................... 269 383 343
Gains (losses) on mortgage loans recorded at fair value .................................... 438 (83) (283)
Other non-interest income .......................................................... 363 128 183
Total non-interest income ........................................................ 1,098 202 248
Non-interest expense: ...............................................................
Administrative expenses ........................................................... (241) (220) (212)
REO operations income (expense) .................................................... 3 11 3
Other non-interest expense ......................................................... (129) (69) (66)
Total non-interest expense ........................................................ (367) (278) (275)
Segment Earnings before income tax benefit (expense) ...................................... 2,145 1,320 988
Income tax benefit (expense) ......................................................... 1 (1) (26)
Segment Earnings, net of taxes, including noncontrolling interest ............................... 2,146 1,319 962
Less: Net (income) loss — noncontrolling interest ........................................ — — 3
Segment Earnings, net of taxes ........................................................ 2,146 1,319 965
Total other comprehensive income, net of taxes ............................................ 1,935 899 4,075
Total comprehensive income attributable to Freddie Mac ..................................... $ 4,081 $ 2,218 $ 5,040
Key metrics:
Balances and Volume:
Average balance of Multifamily loan portfolio(2) ............................................ $ 80,826 $ 83,593 $ 83,163
Average balance of Multifamily guarantee portfolio ......................................... $ 43,247 $ 29,861 $ 21,787
Average balance of Multifamily investment securities portfolio ................................ $ 54,992 $ 61,296 $ 61,332
Multifamily new loan purchase and other guarantee commitment volume(3) ........................ $ 28,774 $ 20,325 $ 14,800
Multifamily units financed from new volume activity(3) ....................................... 435,653 311,046 231,453
Multifamily K Certificate issuance — guaranteed portion ..................................... $ 17,922 $ 11,722 $ 5,694
Multifamily K Certificate issuance — unguaranteed portion ................................... $ 3,281 $ 1,936 $ 750
Yield and Rate:
Net interest yield — Segment Earnings basis .............................................. 0.95% 0.83% 0.77%
Average Management and guarantee fee rate, in bps(4) ........................................ 35.6 42.4 50.1
Credit:
Delinquency rate:
Credit-enhanced loans, at period end .................................................. 0.36% 0.52% 0.85%
Non-credit-enhanced loans, at period end ............................................... 0.10% 0.11% 0.12%
Total delinquency rate, at period end(5) .................................................. 0.19% 0.22% 0.26%
Allowance for loan losses and reserve for guarantee losses, at period end ......................... $ 382 $ 545 $ 828
Allowance for loan losses and reserve for guarantee losses, in bps ............................... 29.7 46.4 75.3
Credit losses, in bps(6) ............................................................... 2.8 6.3 9.6
REO inventory, at net carrying value .................................................... $ 64 $ 133 $ 107
REO inventory, at period end (number of properties) ........................................ 6 20 14
(1) For reconciliations of Segment Earnings line items to the comparable line items in our consolidated financial statements prepared in accordance with
GAAP, see “NOTE 13: SEGMENT REPORTING — Table 13.2 — Segment Earnings and Reconciliation to GAAP Results.”
(2) Includes both unsecuritized multifamily mortgage loans and multifamily mortgage loans underlying consolidated trusts.
(3) Excludes our guarantees issued under the HFA initiative.
(4) Represents Multifamily Segment Earnings — management and guarantee income, excluding prepayment and certain other fees, divided by the sum of
the average balance of the multifamily guarantee portfolio and the average balance of guarantees associated with the HFA initiative, excluding certain
bonds under the NIBP.
(5) See “RISK MANAGEMENT — Credit Risk — Mortgage Credit Risk — Multifamily Mortgage Credit Risk” for information on our reported
multifamily delinquency rate.
(6) Calculated as the amount of multifamily credit losses divided by the sum of the average carrying value of our multifamily loan portfolio and the average
balance of the multifamily guarantee portfolio, including multifamily HFA initiative guarantees.
108 Freddie Mac