Freddie Mac (FRE.P)(FRE.N), the second-largest U.S. home funding company, said on Friday its mortgage investment portfolio grew by an annualized 9.3 percent rate in June, while delinquencies on loans it guarantees accelerated.
The portfolio increased to $829.8 billion for an annualized 6.2 percent increase year to date, the McLean, Virginia-based company said in its monthly volume summary. In June 2008, the portfolio was $791.8 billion.
Delinquencies, which increase stress on the company's capital, jumped to 2.78 percent of its book of business in June from 2.62 percent in May and 0.93 percent in June 2008.
The multifamily delinquency rate, however, fell by 0.01 percentage point to 0.11 percent in June. A year earlier it was 0.04 percent.
Freddie Mac said refinance-loan purchase volume was $50.9 billion in June, up from May's $40.3 billion. March's $52 billion was its largest refinance month since 2003.
The net amount of mortgage-related investments portfolio mortgage purchase and sale agreements entered into during the month of June totaled $9.9 billion, up from the $5.3 billion during the month of May.
The total mortgage portfolio increased at a 6.6 percent annualized rate in June to $2.240 trillion.
Freddie Mac said they completed tender offers to repurchase certain short-term and long-term debt securities in June 2009 and consequently their outstanding debt declined to $857.3 billion and their other investments balance declined to $73.3 billion at June 30, 2009.
In September 2008, the U.S. government seized control of Freddie Mac and its larger sibling, Fannie Mae (FNM.P)(FNM.N), amid heightened worries about shrinking capital at the congressionally chartered companies.
The current agreement with the U.S. Treasury has the retained portfolio at Fannie Mae and Freddie Mac capped at $900 billion until December 31, 2009 when they are to start declining by 10 percent per year until they reach $250 billion.
The government is now relying heavily on Fannie Mae and Freddie Mac in its efforts to stimulate the U.S. housing market by buying more mortgage loans, easing refinancing and helping homeowners avoid foreclosure. The housing market is in the midst of its worst downturn since the Great Depression.
The hard-hit U.S housing market, however, has been showing signs of stabilization, with sales rising and home price declines moderating in many regions of the country. In fact, according to some indexes, home prices in some regions have risen.
(Reporting by Julie Haviv)