Freddie Mac 2015 Annual Report Download - page 364

Executive Compensation Compensation Discussion and Analysis
Freddie Mac 2015 Form 10-K 362
Multifamily The goal was achieved
• Determine the feasibility of transacting additional approved types of
risk transfer structures to determine their: (a) market acceptance; (b)
effectiveness at transferring risk; and (c) ability to expand the scale
of the transfer initiatives. Based on the feasibility assessment,
execute additional risk transfers.
Retained Portfolio The goal was achieved and we received partial extra
credit for reducing the retained portfolio by more than
the amount called for in the annual Purchase
Agreement requirements.
• Continue to implement the approved retained portfolio plan so that it
meets, even under adverse conditions, the annual Purchase
Agreement requirements and the $250 billion Purchase Agreement
cap by December 31, 2018.
• Any sales should be commercially reasonable transactions that
consider impacts to the market, borrowers, and neighborhood
stability.
Implement private mortgage insurance eligibility requirements for
counterparties when finalized The goal was achieved
3 Build a new single-family securitization infrastructure for use by the Enterprises and adaptable for use by
other participants in the secondary market in the future (30%)
Continue working with FHFA, Fannie Mae and CSS to build and
test the CSP and to implement the changes necessary to integrate
the Enterprises' related systems and operations with the CSP.
All goals were achieved
The Enterprises’ work on CSP should incorporate the following design
principles:
• Focus on the functions necessary for current Enterprise single-family
securitization activities;
• Include the development of the operational and system capabilities
necessary to issue a single (common) security; and
• Allow for the integration of additional market participants in a future
system.
Finalize the single (common) security structure, including security
features, disclosure standards, and related requirements. Develop
a plan to implement the single security in the market.
The goal was achieved
Provide active support for mortgage data standardization
initiatives: All goals were achieved
• Develop a plan for collecting the Uniform Closing Disclosure Dataset
(UCD).
• Develop the Uniform Loan Application Dataset (ULAD):
AT-RISK DEFERRED SALARY BASED ON CORPORATE SCORECARD GOALS
AND INDIVIDUAL PERFORMANCE
The other half of each eligible NEO’s At-Risk Deferred Salary, also equal to 15% of Target TDC, was
subject to reduction based on a combination of the company’s performance against the Corporate
Scorecard goals and the NEO’s individual performance. The seven Corporate Scorecard goals drive how
we manage and improve the commercial aspects of our business and are intended to complement the
FHFA Strategic Plan and Conservatorship Scorecard. Certain of the individual performance objectives for
the NEOs were either Conservatorship Scorecard objectives or Corporate Scorecard goals, or directly
supported their achievement.
No weightings were assigned to the Corporate Scorecard goals. As a result, it was necessary for the
Compensation Committee to use its judgment in determining the overall level of performance. In making
its determination, the Committee primarily considered the fact that the vast majority of the Corporate
Scorecard goals were achieved or exceeded. The Compensation Committee determined that, based on
the company’s performance against the Corporate Scorecard, a 100% funding level was justified for this
portion of At-Risk Deferred Salary.