JPMorgan to service Freddie Mac's $700 billion asset portfolio

Mortgage Banking, Sept, 2006

Freddie Mac has selected JPMorgan Worldwide Securities Services, New York, to provide transaction processing and record-keeping services for its approximately $700 billion portfolio of mortgage-backed securities (MBS) and short-term assets.

Freddie Mac's decision to outsource these processing and record-keeping functions is a key component of the company's ongoing initiatives to work with world-class providers to upgrade its technological capabilities and streamline its operating infrastructure, explained Freddie Mac Senior Vice President Joseph Rossi.

"Freddie Mac is committed to achieving a higher level of organizational strength and focus across all of our operations," said Rossi. "By working with a world-class provider like JPMorgan, we are simplifying our operating environment, saving time and money, and more efficiently managing our investment assets at the Federal Reserve Bank and the Depository Trust Company."

Linking JPMorgan's state-of-the-art technology to Freddie Mac's advanced trading platform and developing accounting infrastructure will help the company reconcile transactions and close its books on a more expedited basis, said Michael Clark, head of JPMorgan Worldwide Securities Services.

"JPMorgan is delighted that Freddie Mac selected us for this mandate, which will represent the industry's largest ever. We are pleased that Freddie Mac recognizes our leadership position in management technology, and this further strengthens the deep relationship between our two firms," said Clark. "The size, scale, strength and breadth of JPMorgan's people, products and services means that we can meet Freddie Mac's needs today and well into the future."

JPMorgan Worldwide Securities Services will provide administrative and settlement services for Freddie Mac's estimated $700 billion retained portfolio of longer-term assets--primarily Freddie Mac-issued MBS--and an estimated $70 billion liquidity and contingency portfolio of short-term assets with a variety of issuers that support mortgage investment and debt-funding activities.