Freddie Mac posted a profit of $5 billion in the second quarter and advised no Treasury draws will be required for the period.
The firm's income is up from $4.6 billion in the first quarter, making this the enterprise’s seventh consecutive quarter of profitability and the second highest profit in Freddie's history.
Given Freddie’s net worth of $7.4 billion, the firm's September dividend obligation to the Treasury came in at $4.4 billion.
Meanwhile, credit quality continues to improve at the GSE as it benefits from the nascent housing recovery.
The single-family serious delinquency rate hit 2.79% in July, down from 3.03% in March. In addition, the multifamily delinquency rate came in at 0.09% during the second quarter, compared to 0.16% in March.
Freddie’s ongoing mission to shield taxpayers from mortgage default risk continues. In July, the enterprise finalized $500 million in transactions, effectively shifting more of its multifamily credit risk onto private investors.
As of June, the company’s post-2008 book of business – which generally represents higher underwriting quality – represented 70% of the GSE’s single-family credit guarantee portfolio. Of those loans, 20% are refinance loans, including HARP mortgages.
Since 2009, Freddie has provided $2 trillion in liquidity to the mortgage market, funding 7.2 million refinancings – of which one million occurred in the first half of this year.
In addition, the GSE fueled 1.8 million home purchases and 1.4 million units of multifamily rental housing over the course of five years.
About 872,000 borrowers avoided foreclosure due to aids provided by the GSE, Freddie noted in its earnings report.