CHICAGO – The Federal Home Loan Bank of Chicago, reeling from unrealized losses on its private-label mortgage backed securities, said last week it expects to report a loss of $119 million for 2008 sometime next month when it releases audited results for the year.
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The Chicago Bank, which is under a supervisory agreement with federal regulators limiting dividends and stock buybacks, said it was forced to recognize $292 million in OTTI charges on its private-label MBSs for the year.
For the fourth quarter net income was only $293,000, reflecting the impact of $220 million of OTTI charges.
The troubled MBSs forced the Chicago Bank to cancel a proposed merger with the FLHB Dallas last year.
