Federal Home Loan Bank of Dallas Reports Third Quarter Operating Results
DALLAS, TEXAS – November 2, 2015 – (RealEstateRama) — The Federal Home Loan Bank of Dallas (Bank) today reported net income of $5.6 million for the quarter ended September 30, 2015. In comparison, for the quarter ended June 30, 2015, the Bank reported net income of $23.9 million. For the nine months ended September 30, 2015, the Bank reported net income of $52.5 million.
The decrease in net income from the second quarter to the third quarter of 2015 was largely attributable to a negative swing in gains and losses on the Bank’s derivatives and hedging activities ($19.3 million), most of which are transitory in nature, and a decrease in the Bank’s net interest income ($3.0 million), offset by an increase in net gains on trading securities ($1.1 million), an increase in realized gains on sales of long-term securities ($0.9 million), and a decrease in the Bank’s Affordable Housing Program assessment ($2.0 million).
Total assets at September 30, 2015 were $43.0 billion, compared with $42.6 billion at June 30, 2015 and $38.0 billion at December 31, 2014. The $0.4 billion increase in total assets for the third quarter was attributable primarily to increases in the Bank’s advances ($1.2 billion) and long-term investments ($1.3 billion), offset by a decrease in the Bank’s short-term liquidity portfolio ($1.9 billion). For the nine-month period ended September 30, 2015, the $5.0 billion increase in total assets was attributable primarily to increases in the Bank’s advances ($3.9 billion) and long-term investments ($0.9 billion).
Advances totaled $22.8 billion at September 30, 2015, compared with $21.6 billion at June 30, 2015 and $18.9 billion at December 31, 2014. During the third quarter, the Bank’s lending activities expanded due to increased demand from some of its larger borrowers, which the Bank attributes to increased loan demand and a decrease in liquidity levels at those institutions.
The Bank’s long-term held-to-maturity securities portfolio, which is comprised substantially of U.S. agency residential mortgage-backed securities (MBS), totaled $3.4 billion at September 30, 2015 as compared to $3.7 billion at June 30, 2015 and $4.7 billion at December 31, 2014. The Bank’s long-term available-for-sale securities portfolio, which is comprised substantially of U.S. agency and other highly rated debentures and U.S. agency commercial MBS, totaled $8.4 billion at September 30, 2015 as compared to $7.0 billion at June 30, 2015 and $6.4 billion at December 31, 2014. The Bank also held $0.2 billion of long-term U.S. Treasury Notes in its trading securities portfolio at September 30, 2015.
The Bank’s short-term liquidity portfolio, which is comprised substantially of non-interest bearing excess cash balances, overnight federal funds sold and reverse repurchase agreements, totaled $8.0 billion at September 30, 2015, compared to $9.9 billion at June 30, 2015 and $7.8 billion at December 31, 2014.
During the quarter ended September 30, 2015, the Bank sold approximately $162 million (par value) of U.S. agency residential MBS classified as held-to-maturity (for which a substantial portion of the principal had previously been collected). The aggregate gains recognized on the sales of these securities totaled $3.3 million. In addition, the Bank sold approximately $181 million (par value) of U.S. agency debentures classified as available-for-sale during the quarter ended September 30, 2015. The aggregate gains recognized on the sales of these securities totaled $1.5 million. For the nine months ended September 30, 2015, the Bank recognized gains on the sales of long-term held-to-maturity and available-for-sale investment securities totaling $13.4 million and $3.8 million, respectively.
The Bank’s retained earnings increased to $748.9 million at September 30, 2015, from $744.5 million at June 30, 2015 and $699.8 million at December 31, 2014. On September 30, 2015, a dividend of $1.2 million was paid to the Bank’s shareholders.
Additional selected financial data as of and for the quarter and nine months ended September 30, 2015 (and, for comparative purposes, as of June 30, 2015 and December 31, 2014 and for the quarter ended June 30, 2015) is set forth below. Further discussion and analysis regarding the Bank’s results will be included in its Form 10-Q for the quarter ended September 30, 2015 to be filed with the Securities and Exchange Commission.
About the Federal Home Loan Bank of Dallas
The Federal Home Loan Bank of Dallas is one of 11 district banks in the FHLBank System, which was created by Congress in 1932. The Bank is a member-owned cooperative that supports housing and community development by providing competitively priced loans (known as advances) and other credit products to approximately 850 members and associated institutions in Arkansas, Louisiana, Mississippi, New Mexico and Texas. For more information, visit the Bank’s website at fhlb.com.
Contact:
Corporate Communications
Federal Home Loan Bank of Dallas
www.fhlb.com
(214) 441-8445
