Operator: Good morning, ladies and gentlemen and welcome to the Freddie Mac Second Quarter Financial Results Media Call. I would now turn the call over to Jeffrey Markowitz, Senior Vice President of External Relations and Corporate Communications. Please go ahead.

Jeffrey Markowitz: Thank you. And good morning and thank you for joining us for a discussion of Freddie Mac’s second quarter 2019 financial results. We’re joined today by the company’s CEO, David Brickman; CFO, Jim Mackey; CAO, Jerry Weiss and General Council, Ricardo Anzaldua. Before we begin, we’d like to point out that during this call, Freddie Mac executives may make forward-looking statements, which are based on a set of assumptions about the company’s key business drivers and other factors. Changes in these factors could cause the company’s actual results to vary materially from its expectations. A description of these factors can be found in the company’s quarterly reports on Form 10-Q filed earlier today. Freddie Mac executives also may discuss non-GAAP financial measures. For more information about those measures, please see our earnings press release and related materials, which are posted on the Investor Relations section of freddiemac.com. Our commentary today will be limited to business and market topics. As you know, we cannot comment on public policy or legislation concerning Freddie Mac. As a reminder, this call is for the media and only they can ask questions. It is being recorded and a replay will soon be available on freddiemac.com. We ask that this call not be rebroadcasted or transcribed. With that, I will turn the call over to David Brickman, Freddie Mac’s CEO.

David Brickman: Good morning Jeff. Good morning and thank you for joining us to review our financial and business performance for the second quarter. As many of you know this is my inaugural earnings call as CEO of Freddie Mac and I’m most proud and humbled by the responsibility. We’ll turn to the numbers in just a moment and then I'll talk a little about my priorities as the leader of this pillar of the U.S. housing system. But before I begin, I want to emphasize that our company remains in excellent financial health. The second quarter continued our growing track record of stable returns and a solid book of business. Our risks continue to be well managed and the amount of capital needed on our books further declined. We are fully supporting our mission of providing liquidity, stability and affordability to the rental and home purchase markets. And we are protecting tax payers by transferring increasing amounts of credit with risk away from the company and into the private sector. I also want to emphasize that our recent CEO transition was well planned and executed, providing the company with new leadership in some areas but overall with a level of continuity and consistency. Continuity and consistency in fact is a good theme for my discussion today, I’ll touch on that theme in connection with three important areas. Our financial performance, our credit quality and our conservatorship capital. I’ll begin with our financial performance. In the second quarter, we earned comprehensive income of $1.8 billion, a slight increase compared with the prior quarter and a 25% decrease compared with the second quarter of 2018, which included a $300 million gain from a legal judgement. Our financial performance was propelled by solid business revenue driven primarily by growth in single family guarantee fee income. Market related items had minimal impact, while net revenue remains substantially flat. Based on our earnings, we expect to deliver a $1.8 billion dividend in the U.S. Treasury by September 2019. With that payment, we will have made $121.5 billion in dividend payments. That total would exceed our aggregated treasury draw by nearly $50 billion or close to 70%. Second, we have now seen continues and consistent improvement in our credit quality for several years, this is a testament to our solid risk management practices as well as generally stronger housing prices. In fact, over the quarter single family serious delinquency rate dropped to 0.63% or 63 basis points and multi-families remained near zero. This very strong credit quality not only underscores our risk management expertise, it also demonstrates how we are protecting the tax payer. The third is final area of continuity and consistency, I'll mention concerns the amount of conservatorship capital requires raw risks. Conservatorship capital needed for credit risk on new business activity decreased by 70% for single family and 90% for multifamily. This is thanks in part to our pioneering credit risk transfer activities and our programmatic sale of less liquid assets from our mortgage related investments portfolio. Both of those efforts take risk off our balance sheet and distribute it to the private sector. This not only protects the tax payer, it attracts more and more private capital to the mortgage market. The reduction in conservatorship capital contributed to an increase in one of the key measures of our success, Return on Conservatorship Capital or ROCC. We consider this a proxy for return on equity. ROCC in the second quarter improved to a very solid 14.1%. The fact that we can consistently report solid results like these quarter-after-quarter is a testament to Freddie Mac's remarkable transformation, not just to a better company with profoundly improved strategies around risk management, but to a fundamentally different company, one that is ready to take on the challenges that will lead us to our next chapter. As CEO, I have set out three priorities to meet those challenges. The first is to leverage our position as a housing industry leader. We use our research analytics and technology to enhance the processing tools necessary for a more dynamic housing market that does more for homeowners, renters, investors and lenders of all sizes. We are already playing this important leadership growth. One example of it came to fruition in the second quarter with the successful launch of the Uniform Mortgage Backed Security or the UMBS. This once in a generation effort combined Freddie Mac and Fannie Mae Mortgage Backed Securities into a single to be announced or TBA market. The transition took place formally on June 3rd and it was seamless for investors, market participants and others in the industry. The new market is off to a robust start in more than $8 trillion of trades today, improving the liquidity of the previously separate TBA markets. This transition was a real achievement and I believe we’re capable of even more consequential and more frequent innovation with the right environment and incentives. That means not sitting on our laurels when it comes to innovation like credit risk transfer. For example, overtime, we have introduced a number of new structures for both our flagship single family stacker transaction and our multifamily K-Deals, which launched the revolution in credit risk transfer at the GSEs. In the second quarter, we announced the KG-Deal which will exclusively securitized work force housing loans made through our Green Advantage program to tap new investors and lower our cost of capital. It also means continue to innovate to make the dream of home ownership a reality for more Americans. For example, our single-family business brought a new offering to market in the second quarter Choice Renovation. Choice Renovation is now a permanent loan offering that provides home buyers a flexible choice to purchase a home and finance the cost of renovations with a single close mortgage, saving them both time and money. This leads me to my second priority. Relentlessly focusing on our mission. This company was created for the purpose of improving liquidity, stability and affordability in the U.S. housing market. And with respect to the latter, we believe there are ways of tackle housing affordability that go beyond access to credit. For example, as an industry, we have the duty to use our expertise to help preserve existing housing and help foster affordable housing. To that end, we hope to build responsibly on programs that focus on expanding the supply of affordable housing, such as with our Choice Homes product or our low income housing tax credit equity investments and look for new ways to make a lasting impact, especially in our nations most underserved communities. That effort is already underway. In the second quarter we helped 596,000 families own or rent a home injecting a $127 billion of liquidity into the mortgage market. I’m also proud that in the second quarter, first time home buyers represented 48% of single-family purchase loans acquired by Freddie Mac. And we by no means do it alone. Throughout the country, regional and community lenders are on the frontlines of ensuring access to credit for home buyers. More than 900 regional and community single-family lenders represented nearly half of our purchase volume in the quarter. We’re fortunate to have great partners across the multifamily market as well. Likewise, with many renters bearing the brunt of the affordable housing prices, we focus our multifamily efforts on workforce housing. In the second quarter, 95% of our multifamily production went to rental apartments at those families who generally earn a 120% of area median income or less could afford. Finally, my third priority is to prepare Freddie Mac for a potential end to conservatorship. Nobody knows exactly what the future holds, but the conversation in Washington and the expected released of the administration housing finance reform plan demand that we be ready to follow the path set by that plan and the milestones established by the FHFA Director. And makes no mistake, we will be ready. For my part, I intend to ensure that the new Freddie Mac remains a housing finance leader, one that is fully committed to its mission and firmly focused on hitting whatever milestone the Director lays out for us. That concludes my prepared remarks. Thank you for listening. And now I’d be happy to take any of your questions.

Operator: Thank you [Operator Instructions]

Jeffrey Markowitz: If there are no questions, we’re happy to conclude the call.

Operator: I'm showing no questions at this time. I would now like to turn the call back to Jeffrey Markowitz for closing remarks.

Jeffrey Markowitz: Thank you very much, we appreciate your time. And we will see you next quarter.