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Annual Earnings, Business Up at Freddie

Annual earnings, secondary lending activity and loans outstanding all increased in 2016 at the Federal Home Loan Mortgage Corp.

Last year, the McLean, Virginia-based organization earned $11.6 billion before income tax expense, up from $9.3 billion in 2015.

Freddie Mac presented the earnings data, along with other operational and financial metrics, in its fourth-quarter 2016 earnings report.

During all of 2016, single-family loans purchases and guarantees came to 1.682 million loans for $393 billion, increasing from 1.587 million loans for $351 billion the previous year.

Last year’s total consisted of $205 billion in purchase financing, $175 billion in refinances and $13 billion in loans refinanced through the Home Affordable Refinance Program.

Wells Fargo Bank, N.A., delivered 15 percent of Freddie’s single-family volume last year, more than any other lender. Next was 5 percent each from Quicken Loans Inc.; J.P. Morgan Chase Bank, N.A.; and U.S. Bank, N.A. Another 4 percent came from Bank of America, N.A.

Freddie Mac loans accounted for 17 percent of the $10.216 trillion in U.S. single-family mortgage debt outstanding as of Dec. 31, 2016. The share didn’t change from a year earlier, when $10.042 trillion was outstanding.

Wells Fargo was also the biggest servicer of Freddie Mac loans with a 19 percent share as of Dec. 31, 2016. Chase followed with a 9 percent share, then U.S. Bank’s 8 percent, BofA’s 6 percent and Nationstar Mortgage LLC’s 4 percent.

In its commercial real estate business, 738,901 multifamily units were financed for $56.8 billion last year, rising from 650,402 units for $47.3 billion in 2015.

CBRE Capital Markets Inc. originated 19 percent of Freddie’s multifamily loans last year — the most of any lender. Berkadia Commercial Mortgage LLC followed with a 17 percent share, then 10 percent at
Walker & Dunlop LLC.

Freddie’s share of the $1.152 trillion in U.S. multifamily debt outstanding as of the end of last year was 15 percent, the same share as in 2015 when the total was $1.088 trillion.

Wells Fargo was the biggest CRE servicer for the enterprise with a 15 percent share. CBRE followed with 14 percent, then Berkadia’s 11 percent.

With its planned dividend payment of $4.5 billion, total dividends paid to the Department of the Treasury will reach $105.9 billion, far more than the $71.3 billion in draws it has taken since being thrust into conservatorship in 2008.

As of Feb. 2, there were 6,004 employees on the secondary lender’s payroll.

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