Freddie Mac [1] announced the pricing of its first Structured Agency Credit Risk (STACR) transaction of the year: a $1 billion offering of debt notes whose buyers will share in the risk.
According to the company, the offering "represents one of the largest subordinate mortgage credit securitizations ever brought to market."
“We are pleased with the investor interest and demand for this product as more investors are buying the bonds,” said Freddie Mac SVP Donna Corley. “We plan regular and consistent issuances this year so that the amount of risk transferred to private investors will increase over time.”
More than 65 investors participated in the deal, including at least 20 new buyers, the company said in a release on Friday.
The larger deal included a portion with more protection against the risk of default. Issuance of risk-sharing securities by the company and competitor Freddie Mac began last year in an effort by policy makers to reduce the two company’s roles in the market.