Freddie Mac in May will re-offer a real estate mortgage investment conduit for the first time. The re-offering is due to the large size of the mortgage giant's first Reference REMIC tranche (BW, 4/11), which was priced last week, according to Mark Hanson, v.p. of mortgage funding. Freddie Mac will match the $1.25 billion offering with another offering of the same size, the same coupon and CUSIP number next month.
Hanson expects the size of the Reference REMIC tranches to grow even larger, supported by market demand for large, liquid securities, but declined to speculate how much larger they might grow. He also expects Asian demand for the securities to increase from their 21% participation in the first Reference REMIC. "Demand from Asian investors should increase once they improve their back-office capabilities to handle REMIC's somewhat unique cash flow," Hanson said. Asian investors have recently been more active in the mortgage market (BW, 12/13).