CONGRESS

SUPERVISION AND OVERSIGHT
District 3 • The Federal Home Loan Bank of Pittsburgh 21
At year-end, the FHLBank of Pittsburgh was the fifth
largest FHLBank, with assets of $96.3 billion. Its
balance sheet consisted of 77.3 percent advances,
3.2 percent mortgages, and 19.2 percent cash and investments.
MBS investments totaled $7.0 billion, of which
$1.3 billion were private-label MBS. Approximately 81.2
percent of private-label MBS were below investment-grade.
Advances with a remaining maturity of less than one year
totaled $33.2 billion. Advances grew 17.5 percent to reach
$74.5 billion at year-end, eclipsing the $73.5 billion peak
level reached on March 31, 2008. Funding through consolidated
obligations totaled $90.9 billion and comprised
46.6 percent discount notes and 53.4 percent bonds.
Consolidated obligations with a remaining maturity of
less than one year totaled $69.1 billion.
The FHLBank reported net income of $257 million for
the year, the sixth highest among the FHLBanks. Return
on assets was 0.29 percent, the fifth highest in the
FHLBank System. Net interest income totaled $318 million.
Interest income on advances totaled $346 million,
representing 49.7 percent of total interest income. The
FHLBank’s net interest spread of 0.34 percent was the fifth
lowest in FHLBank System, after declining marginally
from 0.37 percent in 2014. Both the yield on advances
of 0.53 percent and the cost of funds on consolidated
obligations of 0.45 percent were the fourth lowest in the
FHLBank System. Operating expenses of $67 million were
the fifth lowest of any FHLBank in nominal terms and
tied for third lowest when compared to total assets at 0.08
percent.
The FHLBank’s regulatory capital ratio was 4.60 percent,
which was the fourth lowest in the FHLBank System. Its
retained earnings of $881 million were the sixth highest
in nominal terms and third lowest when compared to
total assets at 0.91 percent. The FHLBank’s market value
of equity was 127.9 percent of the par value of its member
capital stock.
The FHLBank had 306 members at year-end 2015: 170
commercial banks, 68 thrifts, 49 credit unions, 17 insurance
companies, and two community development financial
institutions. The FHLBank’s ten largest borrowers held
83.7 percent of total advances.
At the time of its April 2015 examination, FHFA concluded
the FHLBank’s overall condition and operations
were satisfactory with a strong liquidity position. The
examination observed that the FHLBank had developed a
well-designed and articulated framework to guide capital
management, set an appropriate level of retained earnings,
and establish a reasonable dividend policy. FHFA’s most
significant concerns at the 2015 examination pertained to
model risk management including the need to strengthen
model risk management, oversight and the model validation
program. In addition, the examination determined
that the FHLBank’s travel and entertainment expense
review and approval process required improved oversight.
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This summary reflects conclusions made at the time of FHFA’s 2015 examination of the FHLBank of Pittsburgh supplemented by year-end financial information.
REPORT TO CONGRESS • 2015
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