On May 12, 2009, Freddie Mac reported a net loss of $9.9 billion for first-quarter 2009, primarily caused by an $8.8 billion loan-loss provision and an incremental $7.1 billion of other-than-temporary impairment (OTTI) on its private-label mortgage-backed securities (MBS). These negatives were offset by $3.8 billion of net mark-to-market improvements in derivatives and spread tightening in its trading book of private-label MBS, as well as increased net interest income underpinned by lower funding costs in the current rate environment. This quarterly loss does not affect Standard&Poor's Ratings Services' 'AAA/A-1+' senior debt, 'A' subordinated debt, or 'C' preferred stock ratings on Freddie Mac, because Freddie Mac is operating under a regulatory conservatorship. The company's senior debt continues to benefit
