Freddie Mac (FMCC) Q3 2024 earnings summary

Executive summary

• Net income reached $3.1 billion for Q3 2024, up 16% or $420 million year-over-year, driven by lower non-interest expense and higher net interest income.

• Net worth increased to $56.4 billion as of September 30, 2024, up $11.7 billion or 26% year-over-year.

• Supported 415,000 households with home purchases, refinancings, and rentals, with 51% of home purchases for first-time buyers and 51% of loans affordable to low/moderate-income families.

• Operating under FHFA conservatorship since 2008, with continued uncertainty regarding future structure and business model.

• New CEO Diana W. Reid appointed, emphasizing support for homeownership and rental affordability.

Financial highlights

• Net revenues were $5.8 billion, up 3% year-over-year, driven by a 5% increase in net interest income to $5.0 billion.

• Non-interest expense declined to $2.2 billion, down $393 million or 15% year-over-year, partly due to the absence of a $313 million prior-year litigation accrual.

• Benefit for credit losses was $191 million, compared to $263 million in Q3 2023.

• Comprehensive income for Q3 2024 was $3.2 billion, up 17% year-over-year.

• Total mortgage portfolio grew 2% year-over-year to $3.5 trillion, with Single-Family at $3.1 trillion and Multifamily at $452 billion.

Outlook and guidance

• Home prices forecasted to remain flat over the next 12 months, with a 0.8% increase expected in the following year.

• Management highlights significant risks and uncertainties, including regulatory changes, conservatorship status, and market volatility.

• FHFA proposed new affordable housing goals for 2025-2027, with updated compliance evaluation processes.

• Forward-looking statements caution that actual results may differ due to economic, regulatory, and market factors.

• Ongoing support for homebuyers and renters, including new grace periods and disaster relief.