MCLEAN, VA--Freddie Mac has priced $4 billion of 7.00%, five year Reference Notes due July 15, 2005, bringing the total volume of the corporation's Reference Notes outstanding to over $100 billion.

The $4 billion issue, which was scheduled to settle on July 10, was priced at 99.86 to yield 7.033%, or 84.5 basis points over the 6.75% on-the-ran five year Treasury security due May 15, 2005.

Joint lead managers on the transaction were Goldman Sachs & Co., Salomon Smith Barney and UBS Warburg. Co-managers on the transaction are ABN Amro, Daiwa Securities America, Deutsche Banc Alex Brown, HSBC Securities, J.P. Morgan Securities, Lehman Brothers, Merrill Lynch & Co., Morgan Stanley Dean Witter and Prudential Securities.

Jerome Lienhard, senior vice president for investment funding at Freddie Mac, said that this issuance was the first new agency five-year deal to be priced at an on-the-run premium over similar outstanding issues.

"Moreover, the transaction was substantially oversubscribed with over one-third of the placement international and a very high cash component to the book," Mr. Lienhard said.

Freddie Mac now has $100.5 billion of Reference Notes outstanding, including the most recent sale of $4 billion. Recent sales of Reference Notes have ranged from $3 billion to $9 billion in size.

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Source: National Mortgage News, 07/17/2000, Vol. 24 Issue 43, p27, 1p

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