U.S. Bank Global Corporate Trust Services will serve as global agent on Freddie Mac’s landmark US$500 million unsecured bond offering which closed on 26 July 2013.
The new offering, known as Freddie Mac’s STACR (structured agency credit risk) debt notes is unique in that it allows private investors to purchase securities that are linked to a US$22.5 billion reference pool of residential mortgage loans purchased by Freddie Mac.
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STACR represents a significant milestone for the mortgage industry as it serves as the first step in the Federal Housing Finance Agency’s (FHFA) strategic plan to create a vehicle for private investors to participate in the default risk of the loans held by Government Sponsored Enterprises (GSE’s), like Freddie Mac.
Bryan Calder, president of U.S. Bank Global Corporate Trust Services, said: "We look forward to expanding our relationship with Freddie Mac and our appointment to this landmark deal is a testament to U.S. Bank’s expertise and agility in delivering unique corporate trust services to the mortgage and asset-backed market."
Given the structure and strategic importance of the transaction, U.S. Bank created customized investor and collateral reporting methods to meet both the specific needs of Freddie Mac as well as investors of the STACR debt notes. In addition to creating the reporting structure, in its role as global agent, U.S. Bank will serve as paying agent and calculating agent for Freddie Mac.
Kevin Palmer, vice president of costing & portfolio management for Freddie Mac, said: "U.S. Bank is a valuable business partner to Freddie Mac who has shown the expertise to develop the type of customized solutions required for our first STACR transaction."
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