Freddie Mac (FRE) said Thursday morning that beginning with March 2009 REMIC settlements, the company will offer Reverse REMIC Giant PC securities, a new mortgage-related security intended to provide liquidity to the U.S. residential mortgage market and new options for investors. The Reverse REMIC program permits a pro-rata portion of all outstanding Freddie Mac REMIC security classes from a previously issued REMIC group -- which, in aggregate, constitute a pass-through from the mortgage collateral backing the original REMIC group -- to be recombined into a Pass-Through ReREMIC class. This pass-through Re-REMIC class in turn becomes the collateral backing a new Freddie Mac Giant PC security that is eligible collateral for all Freddie Mac resecuritization programs. Additionally, if the collateral backing the original REMIC met Securities Industry and Financial Markets Association TBA (to-be-announced) market good-delivery guidelines at origination, the new Giant security also will meet those same good-delivery guidelines. "Freddie Mac Reverse REMIC Giant PC securities are designed to provide a new, additional dimension of liquidity to the residential mortgage-backed securities market," said Mark Hanson, vice president for mortgage funding. "Historically, remaining tranches in REMIC securities lacked the liquidity sought by investors. Freddie Mac Reverse REMIC securities provide a new alternative investment vehicle by converting them into Freddie Mac Giant PC securities." Beginning with March 30 REMIC settlements, Freddie Mac will issue 15-, 20- and 30-year Reverse REMIC Giant PCs. Write to Paul Jackson at Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments.