Seattle FHLBank Cites 'Earnings Pressure'

The Seattle Federal Home Loan Bank has disclosed that it remains under "earnings pressure," and it has skipped paying a fourth-quarter dividend as part of an effort to build retained earnings."The Seattle Bank expects earnings will remain under pressure," the bank said in declaring a first-quarter dividend of 1.63% on its Class B (1) stock payable on March 31. It paid a 3.5% dividend in the third quarter before signing a supervisory agreement with its regulator. Under a new policy, dividends are based on actual earnings from the previous quarter and payouts are limited to 50% of earnings. In the third quarter, the Seattle bank reported a 53% drop in earnings, to $16.8 million, from the same period in 2003. As of Sept. 30, the bank had nearly $53.2 billion in assets and $58 million in retained earnings.