FHLBank Pittsburgh Announces First Quarter Financial Results

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    PITTSBURGH–(BUSINESS WIRE)–The Federal Home Loan Bank of Pittsburgh (FHLBank Pittsburgh) today
    announced unaudited financial results for the first quarter of 2019. The
    Bank recorded net income of $98.0 million, and the Board of Directors
    declared dividends of 7.75 percent annualized on activity stock and 4.50
    percent annualized on membership stock. Dividends are payable to the
    Bank’s stockholders on April 30, 2019.

    “The momentum we generated throughout the course of 2018 continued into
    the first quarter of 2019,” said Winthrop Watson, president and chief
    executive officer. “The strength of our cooperative’s performance is a
    reflection of the value we deliver to our members.”

    Highlights for first quarter of 2019 include:

    • Net income of $98.0 million
    • Net interest income of $129.9 million
    • Advances at $75.2 billion
    • Letters of credit at $18.6 billion
    • Retained earnings at $1.3 billion

    Operating Results

    The Bank’s net income totaled $98.0 million for the first quarter of
    2019, compared to $78.9 million for the first quarter of 2018. This
    $19.1 million increase was driven primarily by higher net interest

    Net interest income was $129.9 million for the first quarter of 2019,
    compared to $109.6 million in the first quarter of 2018. Higher net
    interest income was primarily due to an increase in average advance
    balances and higher interest rates.

    First quarter 2019 performance allowed the Bank to set aside $11.0
    million for affordable housing programs.

    Balance Sheet Highlights

    At March 31, 2019, total assets were $101.8 billion, compared with
    $107.5 billion at December 31, 2018. The decrease was primarily due to a
    decline in advances, which totaled $75.2 billion at March 31, 2019,
    compared to $82.5 billion at year-end 2018.

    Total capital at March 31, 2019, was $5.2 billion, compared to $5.4
    billion at December 31, 2018. Total retained earnings at March 31, 2019,
    were $1.3 billion, relatively unchanged from year-end 2018. Total
    retained earnings at March 31, 2019, included $371.5 million of
    restricted retained earnings compared with $351.9 million of restricted
    retained earnings at December 31, 2018. At March 31, 2019, FHLBank
    Pittsburgh had total regulatory capital of $5.1 billion and remained in
    compliance with all regulatory capital requirements.

    The Board of Directors declared a dividend on subclass B2 (activity)
    stock equal to an annual yield of 7.75 percent and a dividend on
    subclass B1 (membership) stock equal to an annual yield of 4.50 percent.
    These dividends will be calculated on stockholders’ average balances
    during the period January 1, 2019, to March 31, 2019, and credited to
    stockholders’ accounts on April 30, 2019.

    Detailed financial information regarding first quarter 2019 results will
    be available in FHLBank Pittsburgh’s Quarterly Report on Form 10-Q,
    which the Bank anticipates filing on May 7, 2019.

    About FHLBank Pittsburgh

    As an intermediary between global capital markets and local lenders,
    FHLBank Pittsburgh provides readily available liquidity, as well as
    affordable housing and community development opportunities, to member
    financial institutions of all sizes in Delaware, Pennsylvania and West
    Virginia. The Bank is part of the Federal Home Loan Bank System, which
    was established by Congress in 1932 and serves as a reliable source of
    funds for housing, jobs and growth in all economic cycles.

    This document contains “forward-looking statements” -that is, statements
    related to future, not past, events. In this context, forward-looking
    statements often address our expected future business and financial
    performance, and often contain words such as “expect,” “anticipate,”
    “intend,” “plan,” “believe,” “seek” or “will.” Forward-looking
    statements by their nature address matters that are, to different
    degrees, uncertain.

    Actual performance or events may differ materially from that expected or
    implied in forward-looking statements because of many factors. Such
    factors may include, but are not limited to, economic and market
    conditions, real estate, credit and mortgage markets; volatility of
    market prices, rates and indices related to financial instruments;
    political, legislative, regulatory, litigation, or judicial events or
    actions; changes in assumptions used in the quarterly
    other-than-temporary impairment (OTTI) process; risks related to MBS;
    changes in the assumptions used in the allowance for credit losses;
    changes in the Bank’s capital structure; changes in the Bank’s capital
    requirements; membership changes; changes in the demand by Bank members
    for Bank advances; an increase in advance prepayments; competitive
    forces, including the availability of other sources of funding for Bank
    members; changes in investor demand for consolidated obligations and/or
    the terms of interest rate exchange agreements and similar agreements;
    changes in the Federal Home Loan Bank (FHLBank) System’s debt rating or
    the Bank’s rating; the ability of the Bank to introduce new products and
    services to meet market demand and to manage successfully the risks
    associated with new products and services; the ability of each of the
    other FHLBanks to repay the principal and interest on consolidated
    obligations for which it is the primary obligor and with respect to
    which the Bank has joint and several liability; applicable Bank policy
    requirements for retained earnings and the ratio of the market value of
    equity to par value of capital stock; the Bank’s ability to maintain
    adequate capital levels (including meeting applicable regulatory capital
    requirements); business and capital plan adjustments and amendments;
    technology and cyber-security risks; and timing and volume of market
    activity. These uncertainties may cause our actual future results to be
    materially different than those expressed in our forward-looking
    statements. FHLBank Pittsburgh does not undertake to update any
    forward-looking statements made in this announcement.


    Unaudited Condensed Statements of Condition and Income

    (in millions)

    Condensed Statement of Condition March 31, 2019 December 31, 2018
    Cash and due from banks $79.9 $71.3
    Investments 21,491.1 20,076.6
    Advances 75,233.0 82,475.5
    Mortgage loans held for portfolio 4,526.2 4,461.6
    All other assets 441.8   401.5
    Total assets $101,772.0   $107,486.5
    Consolidated obligations, net $95,360.1 $101,195.2
    All other liabilities 1,253.3   915.0
    Total liabilities 96,613.4 102,110.2
    Capital stock 3,745.6 4,027.3
    Retained earnings 1,304.3 1,275.9
    Accumulated other comprehensive income 108.7   73.1
    Total capital 5,158.6   5,376.3
    Total liabilities and capital $101,772.0   $107,486.5

    For the three months ended
    March 31,

    Condensed Statement of Income 2019   2018
    Total interest income $729.5 $455.9
    Total interest expense 599.6   346.3  
    Net interest income 129.9 109.6
    Provision for credit losses 0.4 2.4
    Gains (losses) on investments 10.1 (8.7 )
    Gains (losses) on derivatives and hedging (13.0 ) 4.1
    All other income 7.0 6.3
    All other expense 24.6   21.2  
    Income before assessments 109.0 87.7
    AHP assessment 11.0   8.8  
    Net income $98.0   $78.9  


    Richard J. Stimel, FHLBank Pittsburgh, 412-288-7351, [email protected]