Freddie Mac 2012 Annual Report Download - page 131

Total Debt, Net
Total debt, net on our consolidated balance sheets consists of: (a) debt securities of consolidated trusts held by third
parties; and (b) other debt.
• PCs and Other Guarantee Transactions issued by our consolidated trusts and held by third parties are recognized as
debt securities of consolidated trusts held by third parties on our consolidated balance sheets. Debt securities of
consolidated trusts held by third parties represent our liability to third parties that hold beneficial interests in our
consolidated trusts. The debt securities of our consolidated trusts may be prepaid at any time, as the loans that
collateralize the debt may be prepaid without penalty at any time.
• Other debt consists of unsecured short-term and long-term debt securities we issue to third parties to fund our
business activities. It is classified as either short-term or long-term based on the contractual maturity of the debt
instrument. See “LIQUIDITY AND CAPITAL RESOURCES” for information about our other debt.
The table below reconciles the par value of other debt and the UPB of debt securities of consolidated trusts held by third
parties to the amounts shown in our consolidated balance sheets.
Table 33 — Reconciliation of the Par Value and UPB to Total Debt, Net
December 31,
2012 2011
(in millions)
Total debt:
Other debt: .............................................................................
Par value ............................................................................ $ 552,472 $ 674,314
Unamortized balance of discounts and premiums(1) .............................................. (5,031) (13,891)
Hedging-related and other basis adjustments(2) .................................................. 77 123
Subtotal ........................................................................... 547,518 660,546
Debt securities of consolidated trusts held by third parties:
UPB ............................................................................... 1,387,259 1,452,476
Unamortized balance of discounts and premiums ............................................... 32,265 18,961
Subtotal ........................................................................... 1,419,524 1,471,437
Total debt, net .......................................................................... $1,967,042 $2,131,983
(1) Primarily represents unamortized discounts on zero-coupon debt.
(2) Primarily represents deferrals related to debt instruments that were in hedge accounting relationships, and changes in the fair value attributable to
instrument-specific interest-rate and credit risk related to foreign-currency denominated debt.
126 Freddie Mac