CHICAGO – The Federal Home Loan Bank of Chicago, coming off a failed merger with the FHLB Dallas, yesterday reported that mid-year losses widened from $74 million in the first quarter, to $152 million, the largest ever for an FHLB.
The Chicago Bank, which continues to hold more than $30 billion in mortgages from its ill-fated secondary market Mortgage Finance Partnership program, recorded a $30 million impairment charge in the second quarter, and a $63 million impairment for the first six months.
The second quarter’s $74 million loss was attributed to a $22 million decrease in net interest income, a $31 million increase in derivative and hedging costs, and a $30 million impairment on certain mortgage backed securities.
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