Federal Home Loan Mortgage Corp (Freddie Mac) Shares Surge Amid Plans for Public Offering
In a significant development for the U.S. housing finance sector, shares of Federal Home Loan Mortgage Corp, commonly known as Freddie Mac, experienced a notable increase in premarket trading on Wednesday, May 28, 2025. This surge followed statements from U.S. President Donald Trump, who announced plans to take the mortgage giants public while ensuring the U.S. government retains its oversight and implicit guarantees.
Freddie Mac, a key player in the secondary mortgage market, operates by purchasing residential mortgage loans from lenders and investing in mortgage-related securities. The company, listed on the OTC Bulletin Board, saw its shares climb to $7.76 as of May 22, 2025, with a 52-week high of $8.14 and a low of $0.94 recorded on August 4, 2024. The company boasts a market capitalization of approximately $17.56 billion.
President Trump’s announcement, made via a post on Truth Social, emphasized his intention to transition Fannie Mae and Freddie Mac into public entities. However, he assured that the government would maintain its implicit guarantees and oversight role. This move comes as the U.S. Treasury continues to hold preferred shares and warrants to purchase about 80% of their common stock, a remnant of the 2008 housing loan crisis bailout.
Freddie Mac, along with Fannie Mae, was established by the U.S. Congress to enhance the national home-lending market by purchasing home loans from private lenders and repackaging them as mortgage-backed securities. As for-profit corporations with private shareholders, both entities have been pivotal in stabilizing the housing finance system.
The announcement has sparked interest among investors and market analysts, who are closely monitoring the potential implications of such a significant shift in the housing finance landscape. As discussions continue, the focus remains on how this transition will impact the broader financial markets and the housing sector in the United States.