Fri Jul 9, 2004

NEW YORK, July 9 (Reuters) - Freddie Mac (FRE.N: Quote, Profile, Research) , the No. 2 U.S. home funding company, on Friday said it expects to issue between $4 billion and $8 billion in U.S. reference notes due up to 10 years in the third quarter, after issuing $8 billion in the second quarter.
Net issuance, excluding any debt repurchases, likely will be -$7 billion to -$11 billion once $15 billion of existing notes mature. In the second quarter, net issuance was -$6.2 billion, Freddie Mac said in a press release.

"Freddie Mac's disciplined approach to liability management in an environment of slower retained portfolio growth is reflected in our reduced issuance plans for this quarter," Louise Herrle, Freddie Mac's treasurer, said in the release.

The agency said it also plans to offer $2 billion to $6 billion of syndicated callables notes, and refrain from issuing two- or three-year reference notes during this quarter.

Freddie Mac plans at least one U.S. reference note repurchase, and may buy back euro reference notes depending on market conditions. Freddie Mac has no plans to issue new euro reference notes during the third quarter.

Separately, Freddie Mac announced a new $3 billion 10-year reference note offering to be priced on July 14 via joint lead managers Citigroup Global Markets, J.P. Morgan and Lehman Brothers.

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