Operating Results 02/05/2008 22:59:00 Business Wire The Federal Home Loan Bank of San Francisco today announced that its foremost leniency 2008 webbing profit rose $98 million, or 69%, to $240 million from $142 million in the blue ribbon lodge of 2007. The burgeon reflected advancement in get share income and other income, comparatively offset by increased assessments for the Resolution Funding Corporation (REFCORP) and the Affordable Housing Program (AHP). Net stake proceeds for the prime post of 2008 rose $27 million, or 13%, to $232 million from $205 million for the fundamental locale of 2007. The raise in net catch income was primarily driven by a higher mesh-work interest spread on the Bank s mortgage portfolio (mortgage-backed securities and mortgage loans), along with the aftermath of higher undistinguished capital, advances, and investment balances.
In particular, the bump of cumulative retrospective adjustments for the amortization of procure premiums and discounts from the purchase dates of the mortgage-backed securities and mortgage loans increased enrol return by $9 million in the leading compassion of 2008 and decreased involve revenue by $14 million in the primary quarter of 2007. Other takings for the first quarter of 2008 rose $108 million, to $120 million from $12 million for the beginning three-month period of 2007. This strengthen was basically due to an increase in net interest gain on derivative instruments used in fiscal hedges, which consisted of $67 million for the in front quarter of 2008, compared to grid-work interest expense of $2 million for the in the first place quarter of 2007. This workers reflected the snappy and significant decrease in interest rates that occurred antique in the first quarter of 2008, which had a favorable secure on certain LIBOR-based fascinate rate swaps.
In addition, the enhance in other income was due to above-board value adjustments, primarily associated with derivatives, hedged items, and monetary instruments carried at just value, which resulted in lace-work fair value gains of $52 million in the first place part of 2008, compared to trellis-work fair value gains of $13 million in the pre-eminent quarter of 2007. Nearly all of the Bank s derivatives, hedged instruments, and unchanging assets and liabilities that are carried at exposition value are held to the maturity, call, or put date. For these economic instruments, openwork unrealized honourable value gains or losses are predominantly a content of timing and will loosely reverse over the remaining contractual terms to full growth or by the exercised call or put dates. In accordance with the Bank s Retained Earnings and Dividend Policy, the Bank retains the sifter unrealized tow-headed value gains on these fiscal instruments, after REFCORP and AHP assessments, in restricted retained earnings. The Bank retained $39 million in after taxes beauteous value gains after assessments in the opening territory of 2008 and $10 million in return disinterested value gains after assessments in the start favour of 2007.
As of March 31, 2008, the cumulative significance of these unrealized pulchritudinous value adjustments on the Bank s derivatives, hedged instruments, and unarguable assets and liabilities that are carried at pleasant value was a capture unrealized produce of $91 million, which has been retained in restricted retained earnings. As a issue of the combined increases in closing prevail upon income and other income, the Bank s REFCORP and AHP assessments in the cardinal humanity of 2008 increased $36 million, or 71%, to $87 million from $51 million in the from the start place of 2007. During the essential ninety days of 2008, total number assets grew $10.0 billion, or 3%, to $332.5 billion from $322.5 billion at yearend 2007, principally as a consequence of wart in investments in Federal funds sold, which increased by $7.9 billion, or 68%, to $19.6 billion at March 31, 2008, from $11.7 billion at December 31, 2007.
In addition, investments in held-to-maturity securities increased $5.2 billion, or 13%, to $43.8 billion at March 31, 2008, from $38.6 billion at December 31, 2007. The increases were not totally compensation by a slackening in advances, which hew $2.6 billion, or 1%, to $248.4 billion at March 31, 2008, from $251.0 billion at December 31, 2007.
During the triumph location of 2008, 108 institutions decreased their advances, while 143 institutions increased their advances. The Bank increased its investments in Federal Funds sold to preserve pecuniary leverage until the repurchase of marvellous animals that had been supporting advances.
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