Uncertainty on MBS Charge Delays FHLBanks' Report

The Federal Home Loan Bank of Boston may have to take a larger impairment charge on its investments in private-label mortgage-backed securities and it has delayed the issuance of the 2008 combined financial report of the 12 FHLBanks. The other 11 FHLBanks have filed their 10-K reports with the Securities and Exchange Commission. "The Boston Bank is still completing its "other-than-temporary impairment" analysis relating to certain investments," the FHLBank Office of Finance said. The Boston bank recently issued a preliminary report that estimated an OTTI charge of $339.1 million for the fourth quarter. But in a SEC filing on Tuesday, the FHLBank said it might have to take additional charges after completing its OTTI assessment. The Boston bank has $652.9 million in private-label MBS. The preliminary report said the bank only expects a $22 million loss over the life of the securities.