Freddie Mac Brings Greater Diversity and Equity to its Single-Family and Multifamily Credit Risk Transfer Programs
Company Executes Transactions with Certified Minority-Business Enterprise Protecdiv
McLean, VA – Freddie Mac (OTCQB: FMCC) today announced that its Single-Family and Multifamily Credit Risk Transfer (CRT) programs acquired credit protection of approximately $833 million on more than $50 billion unpaid principal balance (UPB) of mortgage loans, brokered by Aon plc, a leading global professional services firm, and sub-brokered by certified minority-business enterprise (MBE) Protecdiv in 2022.
“Freddie Mac is committed to the inclusion of qualified, diverse-owned businesses in the sourcing of financial services,” said Mike Reynolds, Freddie Mac vice president of CRT.
“We actively seek out third party-certified and self-certified minority businesses capable of meeting our demanding requirements as part of our overall effort to bring greater equity to the housing finance industry,” added Freddie Mac’s Jeff Shue, senior director of Single-Family CRT.
Freddie Mac’s Single-Family CRT ACIS® (Agency Credit Insurance Structure) program closed three (re)insurance transactions in 2022 placed by Aon as broker and Protecdiv as sub-broker. These included ACIS 2022-SPH3, which closed in November 2022, and ACIS 2022-SPL6 and ACIS 2022-SPL7, which closed in December 2022. Together the transactions totaled $634 million of credit protection on $44.6 billion UPB of loans.
“Protecdiv is a certified MBE brokerage firm that focuses exclusively on large, enterprise-scale risks. We hope their participation in our transactions will help draw more minority-led firms into this space. Freddie Mac is committed to supporting equity throughout the housing industry,” said Freddie Mac’s Robert Koontz, senior vice president for Multifamily Capital Markets.
In November 2022, Freddie Mac completed a Multifamily Credit Insurance Pool (MCIP) insurance-based credit risk sharing transaction, MCIP 2022-R5, with coverage of $198.9 million on a reference pool of $5.5 billion UPB, with Aon as broker and Protecdiv as a sub-broker.
Joe Monaghan, Global Growth Leader for Aon’s Reinsurance Solutions and CEO of Aon’s Public Sector Partnership, said, “Aon has proudly served Freddie Mac for nearly a decade, brokering their ground-breaking mortgage reinsurance programs. We are thrilled to collaborate with Protecdiv as we continue to deliver on Freddie Mac’s and Aon’s shared commitment to greater inclusion and diversity, innovation, and impact.”
“We are delighted to work with Freddie Mac and to help it achieve its vital mission, including its effort to improve equity in the housing finance industry,” said Kael Coleman, founder and chief executive officer at Protecdiv. “Protecdiv was built to service the supplier diversity goals of large U.S. businesses and public entities. Through our proud collaboration with Aon, we now have the scale, alongside our diverse supplier qualifications and extensive expertise, to service large corporations.”
About Freddie Mac Credit Risk Transfer
Freddie Mac’s Single-Family CRT and Multifamily CRT programs transfer credit risk away from U.S. taxpayers to global private capital via securities and (re)insurance policies, providing stability, liquidity and affordability to the U.S. housing market. The GSE Single-Family CRT market was founded when Freddie Mac issued the first STACR® (Structured Agency Credit Risk) notes in July 2013. In November 2013, ACIS® (Agency Credit Insurance Structure®) was introduced. Today, the industry-leading and award-winning programs attract institutional investors and (re)insurance companies worldwide. For specific STACR and ACIS transaction data, visit Clarity Data Intelligence℠.
Freddie Mac introduced the MSCR (Multifamily Structured Credit Risk) Notes and MCIP (Multifamily Credit Insurance Pool) to its credit risk transfer program in May 2016 and December 2018 respectively. Today, both programs attract institutional investors and (re)insurance companies worldwide. For specific MSCR and MCIP transaction data, visit Multifamily Securities Investor Access.
About Freddie Mac
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we’ve made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders, investors and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac, and Freddie Mac’s blog FreddieMac.com/blog.
Aon plc (NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Our colleagues provide our clients in over 120 countries and sovereignties with advice and solutions that give them the clarity and confidence to make better decisions to protect and grow their business. Follow Aon on LinkedIn, Twitter, Facebook and Instagram. Stay up-to-date by visiting the Aon Newsroom and sign up for News Alerts here.
Protecdiv believes in Improving Society through Insurance as a Property & Casualty insurance and reinsurance broker and Mortgage Risk Transfer advisor serving large publicly traded and privately held companies, as well as government and government-sponsored entities. Protecdiv is a certified minority business enterprise (MBE) by the NMSDC and other certifying bodies. For more information, please visit https://protecdiv.com/.