ATLANTA, April 29, 2021 (GLOBE NEWSWIRE) -- Federal Home Loan Bank of Atlanta (the Bank) today released preliminary unaudited financial highlights for the quarter ended March 31, 2021. All numbers reported below for the first quarter of 2021 are approximate until the Bank announces unaudited financial results in its Form 10-Q filing with the Securities and Exchange Commission (SEC), which is expected to be filed on or about May 7, 2021.
Net income for the first quarter of 2021 was $43 million, a decrease of $65 million compared to net income of $108 million for the first quarter of 2020. The decrease in net income was primarily due to an $85 million gain from the sale of the Bank’s private-label mortgage-backed securities investment portfolio, partially offset by an additional voluntary $20 million retirement plan contribution, during the first quarter of 2020. Additionally, net interest income for the first quarter of 2021 decreased by $6 million compared to the first quarter of 2020. This decrease in net interest income was primarily due to a decrease in advances and other interest-earning assets, partially offset by a decrease in interest rates which impacted interest-bearing liabilities more than interest-earning assets.
Total assets as of March 31, 2021 were $86.1 billion, a decrease of $6.2 billion, or 6.72 percent, from December 31, 2020. Advances outstanding were $49.5 billion as of March 31, 2021, a decrease of $2.7 billion, or 5.18 percent, from December 31, 2020, as a result of decreased demand for liquidity. Retained earnings were $2.2 billion as of March 31, 2021 and December 31, 2020. Capital stock was $2.5 billion as of March 31, 2021, a decrease of $535 million, or 17.4 percent, from $3.1 billion as of December 31, 2020. The decrease in capital stock primarily relates to certain changes in members’ minimum capital stock requirements that the Bank implemented in March 2021.
The Bank's first quarter 2021 performance resulted in an annualized return on average equity (ROE) of 3.35 percent as compared to 5.97 percent for the first quarter of 2020. The ROE spread to average Secured Overnight Financing Rate decreased to 331 basis points for the first quarter of 2021, as compared to 474 basis points for the first quarter of 2020. As of March 31, 2021, the Bank was in compliance with its regulatory capital requirements.
Operational Status
As a financial institution, the Bank is part of the nation’s critical infrastructure, has continually operated its business, and has continued to serve as a reliable source of funding for our members. The Bank continues to operate in Phase 2 of its return to office plan, which provides that up to 33 percent of the Bank’s employees may work on-site. To date, the Bank has not experienced significant operational difficulties or disruptions, however the possibility exists, which could impair the Bank’s ability to conduct and manage its business effectively. To date, no member of the Bank’s executive management team has been incapacitated or unable to perform duties. The Bank’s board of directors regularly reviews the Bank’s succession plan in the event of incapacitation of any executive team member.
Federal Home Loan Bank of Atlanta
Financial Highlights
(Preliminary and unaudited)
(Dollars in millions)
| Statements of Condition | As of March 31, 2021 | As of December 31, 2020 | ||||||||
| Advances | $ | 49,463 | $ | 52,168 | ||||||
| Investments | 32,880 | 36,380 | ||||||||
| Mortgage loans held for portfolio, net | 199 | 218 | ||||||||
| Total assets | 86,095 | 92,295 | ||||||||
| Consolidated obligations, net | 78,376 | 84,764 | ||||||||
| Total capital stock | 2,543 | 3,078 | ||||||||
| Retained earnings | 2,211 | 2,198 | ||||||||
| Accumulated other comprehensive loss | (13 | ) | (16 | ) | ||||||
| Total capital | 4,741 | 5,260 | ||||||||
| Capital-to-assets ratio (GAAP) | 5.51 | % | 5.70 | % | ||||||
| Capital-to-assets ratio (Regulatory) | 5.52 | % | 5.72 | % | ||||||
| Three Months Ended March 31, | ||||||||
| Operating Results and Performance Ratios | 2021 | 2020 | ||||||
| Net interest income | $ | 79 | $ | 85 | ||||
| Standby letters of credit fees | 4 | 7 | ||||||
| Other income | — | 86 | ||||||
| Total noninterest expense | 36 | 58 | ||||||
| Affordable Housing Program assessment | 4 | 12 | ||||||
| Net income | 43 | 108 | ||||||
| Return on average assets | 0.19 | % | 0.28 | % | ||||
| Return on average equity | 3.35 | % | 5.97 | % | ||||
The selected financial data above should be read in conjunction with the financial statements and notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Bank's First Quarter 2021 Form 10-Q expected to be filed on or about May 7, 2021 with the SEC.
About the Federal Home Loan Bank of Atlanta
FHLBank Atlanta offers competitively-priced financing, community development grants, and other banking services to help member financial institutions make affordable home mortgages and provide economic development credit to neighborhoods and communities. The Bank's members—its shareholders and customers—are commercial banks, credit unions, savings institutions, community development financial institutions, and insurance companies located in Alabama, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia, and the District of Columbia. FHLBank Atlanta is one of 11 district banks in the Federal Home Loan Bank System. Since 1990, the FHLBanks have awarded approximately $6.6 billion in Affordable Housing Program funds, assisting more than 957,000 households.
For more information, visit our website at www.fhlbatl.com.
Some of the statements made in this announcement are “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, which include statements with respect to the Bank's beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties, and other factors, many of which may be beyond the Bank's control, and which may cause the Bank's actual results, performance, or achievements to be materially different from the future results, performance, or achievements expressed or implied by the forward-looking statements.
The forward-looking statements may not be realized due to a variety of factors, including, without limitation: the impact of the COVID-19 pandemic on the Bank, its employees, members and counterparties, or on the capital markets and the U.S. economy, which impact is evolving and unknowable at this time and could include impacts to the Bank’s operations, liquidity, profitability, financial condition and results of operations, and dividend. Additional factors include legislative, regulatory and accounting actions, changes, approvals or requirements; completion of the Bank’s financial closing procedures and final accounting adjustments for the most recently completed quarter; uncertainties relating to the phase-out of LIBOR; future economic and market conditions (including the housing market); changes in demand for advances or consolidated obligations of the Bank and/or the FHLBank System; changes in interest rates; changes in prepayment speeds, default rates, delinquencies, and losses on mortgage-backed securities; volatility of market prices, rates and indices that could affect the value of financial instruments; changes in credit ratings and/or the terms of derivative transactions; changes in product offerings; political, national, and world events, including the impact and results of upcoming U.S. national elections; disruptions in information systems; membership changes; and adverse developments or events affecting or involving other Federal Home Loan Banks or the FHLBank System in general. Additional factors that might cause the Bank's results to differ from these forward-looking statements are provided in detail in our filings with the Securities and Exchange Commission, which are available at www.sec.gov.
New factors may emerge, and it is not possible for us to predict the nature of each new factor, or assess its potential impact, on our business and financial condition. Given these uncertainties, we caution you not to place undue reliance on forward-looking statements. These statements speak only as of the date that they are made, and the Bank has no obligation and does not undertake to publicly update, revise, or correct any of the forward-looking statements after the date of this announcement, or after the respective dates on which such statements otherwise are made, whether as a result of new information, future events, or otherwise, except as may be required by law.
CONTACT:
Peter E. Garuccio
Federal Home Loan Bank of Atlanta
pgaruccio@fhlbatl.com
404.888.8143