Chicago FHLBank Reports Earnings Falloff

The Chicago Federal Home Loan Bank has reported a 4.3% drop in earnings for the second quarter, and the numbers indicate that its mortgage purchase business nearly dried up.The Chicago FHLBank, which developed the Mortgage Partnership Finance program, posted $94.2 million in earnings for the second quarter, compared with $98.5 million in the second quarter of 2003. The bank also reported that the growth of its $49.1 billion MPF portfolio slowed to an annual rate of 3.9% in the first half of the year, and it added only $500 million in single-family loans to its MPF portfolio in the second quarter. Under a supervisory agreement with its federal regulator, the Chicago bank must limit the growth of the portfolio to 10% a year. "Given the low origination volumes, the bank fully anticipates meeting its members' funding demands for MPF loans," the Chicago FHLBank said.