CIT/FreddieMac - All In The Family

Unless you really know the players behind the facade, how can you possibly understand what's really taking place? So here's a small Reuters article about CIT Group and Freddie Mac:

CIT Group arranges financing with Freddie Mac
Wed Sep 19, 2007 8:44am EDT
Co announces that it has agreed to sell to Freddie Mac between $3.5 and $4.2 bln of "AAA-rated" securities backed by approximately $6 bln of residential mortgages. The ultimate amount of the "AAA-rated" mortgage-backed securities to be sold will be determined following completion of rating agency review. Separately, the co expects to obtain $2 bln through an interim facility provided by Morgan Stanley Bank, which will be repaid upon the settlement of the Freddie Mac transaction.

This gets much more interesting when you view the Major Holders of each of these companies. If you click on the links within each table, it brings up another whole group of entanglements. You will also notice that not one company has any insiders owning even 1% of their company. These are plantations controlled by absentee landlords.

My point is that most of these deals are a lot more incestuous than one would think. They're not exactly distinct enterprises. No wonder things are such a mess. One could be excused for thinking there's a whole lot of C Y A going on related to this subprime mess.
Note: Two rating agencies [Standard and Poors; Moody's]are the last two companies listed.

Symbol Name Of Corporation CIT Major Holders CIT Group, Inc. (As of 30-Jun-2007) Top 10 Institutional Holders Shares 2007 Value 2006 Barclays Global Investors UK Holdings Ltd 31,810,265 16.67% $1,744,156,829 -.--% Neuberger Berman, LLC 10,092,302 5.29% $553,360,918 -.--% State Street Corporation 8,564,797 4.49% $469,607,819 -.--% Mellon Financial Corporation 6,957,985 3.65% $381,506,317 -.--% Vanguard Group, Inc. (The) 6,950,920 3.64% $381,118,943 -.--% JP Morgan Chase & Company 5,970,613 3.13% $327,368,710 -.--% LSV Asset Management 5,890,154 3.09% $322,957,143 -.--% Wellington Management Company, LLP 4,786,136 2.51% $262,423,836 -.--% Goldman Sachs Group Inc 3,752,932 1.97% $205,773,261 -.--% U.S. Trust Corporation 3,451,954 1.81% $189,270,637 -.--% % of Shares Held by All Insider and 5% Owners: 0% -.--% Top 10 [3.8%] of 265 Institutional Holders Control 46.25% -.--% Percentage of Barclays and "Associates" Control 37.01% -.--%

NOTE: Vanguard manages four funds that control 3.67%.
Therefore, the TOP 10 control 49.92% of CTI Group.

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Symbol Name Of Corporation [Freddie Mac] FRE Major Holders Federal Home Loan Mortgage Corporation (As of 30-Jun-2007) (As of 30-Jun-2006) Top 10 Institutional Holders Shares 2007 Value 2006 Capital Research And Management Company 84,247,000 12.25% $5,113,792,900 9.09% AXA (Paris, France) 45,538,542 6.62% $2,764,189,499 5.75% Morgan Stanley 44,397,395 6.45% $2,694,921,876 7.70% Barclays Global Investors UK Holdings Ltd 27,278,162 3.96% $1,655,784,433 3.91% Citigroup Inc. 23,981,061 3.49% $1,455,650,402 3.18% Pzena Investment Management, LLC 21,216,597 3.08% $1,287,847,437 -.--% Vanguard Group, Inc. (The) 19,043,270 2.77% $1,155,926,489 2.64% State Street Corporation 18,766,498 2.73% $1,139,126,428 2.94% Goldman Sachs Group Inc 17,201,899 2.50% $1,044,155,269 3.33% FMR Corporation (Fidelity Management & Research Corp) 13,486,482 1.96% $818,629,457 -.--% % of Shares Held by All Insider and 5% Owners: 0% 0% Top 10 [1.7%] of 565 Institutional Holders Control 45.81% 43.66% Percentage of Barclays and "Associates" Control 15.1% 23.45%

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Symbol Name Of Corporation MS Major Holders Morgan Stanley (As of 30-Jun-2007) (As of 30-Jun-2006) Top 10 Institutional Holders Shares 2007 Value 2006 State Street Corporation 128,257,825 12.19% $10,758,266,361 10.90% Barclays Global Investors UK Holdings Ltd 61,031,741 5.80% $5,119,342,435 6.02% UBS Global Asset Management (Americas) Inc 34,123,369 3.24% $2,862,268,191 3.17% Vanguard Group, Inc. (The) 28,447,670 2.70% $2,386,190,559 2.45% FMR Corporation (Fidelity Management & Research Corp) 22,878,004 2.17% $1,919,006,975 1.50% Price (T.Rowe) Associates Inc 14,148,757 1.34% $1,186,797,737 1.33% JP Morgan Chase & Company 12,901,715 1.23% $1,082,195,854 1.14% Mellon Financial Corporation 11,814,956 1.12% $991,038,509 -.--% Northern Trust Corporation 11,068,304 1.05% $928,409,339 1.24% Goldman Sachs Group Inc 9,161,976 .87% $768,506,546 -.--% % of Shares Held by All Insider and 5% Owners: 0% 0% Top 10 [1%] of 978 Institutional Holders Control 30.84% 30.00% Percentage of Barclays and "Associates" Control 23.60% 20.63%

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Rating Agencies

Symbol Name Of Corporation MHP Major Holders The McGraw-Hill Companies, Inc. (As of 30-Jun-2007) (As of 30-Jun-2006) Top 10 Institutional Holders Shares 2007 Value 2006 Goldman Sachs Group Inc 20,149,810 5.95% $1,371,799,064 7.61% State Street Corporation 12,436,337 3.67% $846,665,822 3.52% Barclays Global Investors UK Holdings Ltd 10,990,306 3.24% $748,220,032 3.17% Vanguard Group, Inc. (The) 9,617,194 2.84% $654,738,567 2.62% FMR Corporation (Fidelity Management & Research Corp) 9,335,404 2.75% $635,554,304 4.40% UBS Global Asset Management (Americas) Inc 9,095,874 2.68% $619,247,101 -.--% Sarofim, Fayez * 8,676,547 2.56% $590,699,319 3.14% Deutsche Bank Aktiengesellschaft (Frankfurt, Germany) 8,358,934 2.47% $569,076,226 2.40% Transamerica Investment Management LLC The Hague, Netherlands 7,688,676 2.27% $523,445,062 -.--% Putnam Investment Management, LLC 6,929,696 2.04% $471,773,703 -.--% % of Shares Held by All Insider and 5% Owners: 0% 0% Top 10 [1.5%] of 666 Institutional Holders Control 30.47% 32.46% Percentage of Barclays and "Associates" Control 14.90% 19.90%

NOTE: McGraw-Hill owns these companies and these:

• BusinessWeek Magazine
• Standard & Poors Ratings Service
• Standard & Poors Financial Information

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Symbol Name Of Corporation MCO Major Holders Moody's Corp. (As of 30-Jun-2007) Top 10 Institutional Holders Shares 2007 Value 2006 Berkshire Hathaway, Inc 48,000,000 17.98% $2,985,600,000 -.--% Davis Selected Advisers, LP 18,888,035 7.08% $1,174,835,777 -.--% Barclays Global Investors UK Holdings Ltd 13,749,685 5.15% $855,230,407 -.--% Marsico Capital Management, LLC 12,695,111 4.76% $789,635,904 -.--% Goldman Sachs Group Inc 11,992,247 4.49% $745,917,763 -.--% Sands Capital Management, Inc. 10,554,252 3.95% $656,474,474 -.--% Baillie Gifford And Company 10,153,348 3.80% $631,538,245 -.--% Morgan Stanley 6,890,441 2.58% $428,585,430 -.--% Vanguard Group, Inc. (The) 6,602,968 2.47% $410,704,609 -.--% AXA (Paris, France) 6,134,477 2.30% $381,564,469 -.--% % of Shares Held by All Insider and 5% Owners: 0% -.--% Top 10 [1.9%] of 522 Institutional Holders Control 54.56% -.--% Percentage of Barclays and "Associates" Control 12.22% -.--%

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© 2007 by Edward Ulysses Cate
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