CINCINNATI, July 26, 2017 /PRNewswire/ --The Federal Home Loan Bank of Cincinnati (the FHLB) today released unaudited financial results for the second quarter ended June 30, 2017. The FHLB expects to file its second quarter 2017 Form 10-Q with the Securities and Exchange Commission on or about August 10, 2017.
The FHLB is a AA+ rated wholesale cooperative bank owned by 662 member financial institutions. The FHLB is a proven partner that supports housing and community development through a diverse membership base including commercial banks, thrifts, credit unions, insurance companies and community development financial institutions in Kentucky, Ohio and Tennessee. It annually sets aside a portion of its profits for grants supporting affordable housing, and since 1990 has awarded more than $632 million in subsidies towards the creation of 80,900 units of affordable housing.
Operating Results and Profitability
Dividend
Housing and Community Investment
Balance Sheet Highlights
About the FHLB
The FHLB provides members access to products and services (primarily Advances, which are a readily available, low-cost source of funds, purchases of certain mortgage loans from members, and issuance of Letters of Credit to members) and a competitive return through quarterly dividends on their capital investment in the FHLB. The FHLB funds these products and services by raising private-sector capital from member-stockholders and, with the other Federal Home Loan Banks (FHLBanks) in the FHLBank System, issuing high-quality debt in the worldwide capital markets. The FHLB also funds community investment programs that help its members create affordable housing and promote community economic development.
This news release may contain forward-looking statements that are subject to risks and uncertainties that could affect the FHLB's financial condition and results of operations. These include, but are not limited to, the effects of economic and financial conditions, legislative or regulatory developments concerning the FHLBank System, financial pressures affecting other FHLBanks, competitive forces, and other risks detailed from time to time in the FHLB's annual report on Form 10-K and other filings with the Securities and Exchange Commission. The forward-looking statements speak as of the date made and are not guarantees of future performance. Actual results or developments could differ materially from the expectations expressed or implied in the forward-looking statements, and the FHLB undertakes no obligation to update any such statements.
The Federal Home Loan Bank of Cincinnati | ||||||||||
Financial Highlights (unaudited) | ||||||||||
Dollars in millions | ||||||||||
SELECTED BALANCE SHEET ITEMS | ||||||||||
June 30, 2017 |
December 31, 2016 |
Percent | ||||||||
Total assets |
$ |
109,053 |
$ |
104,635 |
4 |
% | ||||
Advances (principal) |
71,112 |
69,907 |
2 |
|||||||
Mortgage loans held for portfolio (principal) |
9,224 |
8,926 |
3 |
|||||||
Total investments |
27,934 |
25,334 |
10 |
|||||||
Consolidated Obligations |
102,719 |
97,881 |
5 |
|||||||
Mandatorily redeemable capital stock |
36 |
35 |
3 |
|||||||
Capital stock |
4,220 |
4,157 |
2 |
|||||||
Total retained earnings |
890 |
834 |
7 |
|||||||
Total capital |
5,098 |
4,978 |
2 |
|||||||
Regulatory capital (1) |
5,146 |
5,026 |
2 |
|||||||
Capital-to-assets ratio (GAAP) |
4.67 |
% |
4.76 |
% |
||||||
Capital-to-assets ratio (Regulatory) (1) |
4.72 |
4.80 |
OPERATING RESULTS |
|||||||||||||||||||||||
Three Months Ended June 30, |
Six Months Ended June 30, | ||||||||||||||||||||||
2017 |
2016 (2) |
Percent Change (3) |
2017 |
2016 (2) |
Percent Change (3) | ||||||||||||||||||
Total interest income |
$ |
385 |
$ |
297 |
29 |
% |
$ |
728 |
$ |
600 |
21 |
% | |||||||||||
Total interest expense |
279 |
215 |
30 |
519 |
429 |
21 |
|||||||||||||||||
Net interest income |
106 |
82 |
28 |
209 |
171 |
22 |
|||||||||||||||||
Non-interest income (loss) |
10 |
7 |
52 |
(1) |
3 |
NM |
|||||||||||||||||
Non-interest expense |
20 |
21 |
(6) |
39 |
43 |
(7) |
|||||||||||||||||
Affordable Housing Program assessments |
9 |
7 |
40 |
17 |
13 |
27 |
|||||||||||||||||
Net income |
$ |
87 |
$ |
61 |
41 |
$ |
152 |
$ |
118 |
29 |
|||||||||||||
Return on average equity |
6.94 |
% |
4.93 |
% |
6.10 |
% |
4.71 |
% |
|||||||||||||||
Return on average assets |
0.35 |
0.24 |
0.30 |
0.22 |
|||||||||||||||||||
Net interest margin |
0.42 |
0.32 |
0.42 |
0.32 |
|||||||||||||||||||
Annualized dividend rate |
4.75 |
4.00 |
4.62 |
4.00 |
|||||||||||||||||||
Average 3-month LIBOR |
1.20 |
0.64 |
1.14 |
0.63 |
(1) |
Regulatory capital includes capital stock, mandatorily redeemable capital stock (classified as a liability) and retained earnings. |
(2) |
During the fourth quarter of 2016, the FHLB changed to the contractual interest method for amortizing premiums and accreting discounts on mortgage loans held for portfolio. This change has been reported through retroactive application of the change in accounting principle to all periods presented. |
(3) |
Amounts used to calculate the change column are based on dollars in thousands. Accordingly, recalculations based upon the disclosed amounts (millions) may not produce the same results. Changes of 100% or greater are shown as "NM" (not meaningful). |
SOURCE Federal Home Loan Bank of Cincinnati
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