Q4 2024 Federal Home Loan Mortgage Corp Earnings Call Transcript
Key Points
- Federal Home Loan Mortgage Corp (FMCC) reported its strongest earnings since 2021, with a full year net income of $11.9 billion, marking a 13% increase from the prior year.
- The company's net worth reached nearly $60 billion, reflecting a 25% year-over-year growth, enhancing its financial stability.
- FMCC supported the housing market by acquiring over 1 million loans from more than 1,000 lenders, packaging them into mortgage-backed securities (MBS) totaling over $411 billion, an 18% increase from 2023.
- The company financed 52% of primary home purchases for first-time home buyers and ensured 53% of all home loans were affordable for low and moderate-income families.
- Non-interest income surged by 55% year-over-year to $4.2 billion, driven by higher revenues from loan purchase and securitization activities and lower realized losses on sales of available-for-sale securities.
- Provision for credit losses was an expense of $0.5 billion for the full year 2024, primarily due to a credit reserve build in the single-family segment.
- The serious delinquency rate in the single-family portfolio increased to 59 basis points, up from 55 basis points at the end of 2023, mainly due to recent hurricanes.
- The multi-family delinquency rate rose to 40 basis points from 28 basis points at the end of 2023, driven by an increase in delinquent floating rate loans.
- The average net guarantee fee rate on new business decreased by 1 basis point from 2023, potentially impacting future revenue streams.
- Despite strong financial performance, the company faced challenges with credit loss provisions due to new acquisitions and economic uncertainties affecting loan performance.
Morning and thank you for joining us for a presentation of Freddie Mac's fourth quarter and full year 2024 financial results. I'm Jeff Markowitz, SVP and Chief External Affairs Officer. We're joined today by our EVP and Chief Financial Officer, Jim Whittlinger.
Before we begin, we'd like to point out that during the call, Mr. Whittlinger may make forward-looking statements based on assumptions about the company's key business drivers and other factors. Changes in these factors could cause the company's actual results to materially vary from its expectations. A description of those factors can be found in the company's 10K filed today. You'll find the 10K earnings press release and related materials posted on the investor relations section of Freddie Mac.com.
This call is recorded and a replay will soon be available on freddiemac.com. We ask that the call not be rebroadcast or transcribed. With that, I'll turn the call over to Freddie Mac, CFO Jim Whittlinger.
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