Tue, May 6, 1:45 PM (5 days ago)
### Summary of Financial Performance for Federal Home Loan Bank of Pittsburgh (FHLBPG) **Q1 2025 Financial Overview:** - **Revenue and Profit Margins:** - Net income for Q1 2025 was $120.1 million, down from $154.0 million in Q1 2024. - Net interest income decreased to $172.2 million from $195.7 million. - Noninterest income saw a significant drop to $(43) thousand from $14.9 million. - Other expenses remained relatively stable at $37.9 million compared to $38.1 million. - **Cash Flow and Earnings Changes:** - The decrease in net income was primarily driven by lower short-term interest rates and reduced average advances. - The net interest margin was 68 basis points in Q1 2025, down from 71 basis points in Q1 2024. - Noninterest income was negatively impacted by valuation changes in the Bank’s derivative and trading securities portfolios due to interest rate volatility. - **Quarterly Performance Discussion:** - The Bank's financial condition and results of operations are influenced by global and national economies, local economies within its three-state district, and the conditions in the financial, housing, and credit markets. - The interest rate environment significantly impacts the Bank’s profitability, with net interest income affected by market interest rate levels and volatility, credit spreads, and the general state of the economy. - **Trends and Uncertainties:** - The U.S. economy remained resilient in Q1 2025, but fiscal policy uncertainty increased concerns about economic activity. - The March 2025 Federal Open Market Committee statement noted increased uncertainty around the economic outlook. - The federal funds target range was left unchanged at the January and March meetings. - **Future Operations Impact:** - The Bank continues to manage its liquidity and funding strategies to support its asset base and meet regulatory requirements. - The Bank’s ability to operate its business, meet its obligations, and generate net interest income depends primarily on its ability to issue large amounts of various debt structures at attractive rates. - The Bank’s liquidity resources are designed to support these strategies and requirements through a focus on maintaining a liquidity and funding balance between its financial assets and financial liabilities. **Key Metrics:** - **Return on Average Equity:** 9.00% for Q1 2025, down from 11.14% in Q1 2024. - **Capital Adequacy:** The Bank met all of its capital requirements as of March 31, 2025, and was deemed “adequately capitalized” by the Federal Housing Finance Agency. - **Dividends:** The Bank paid quarterly dividends of 9.00% annualized on activity stock and 4.60% annualized on membership stock. **Conclusion:** The Federal Home Loan Bank of Pittsburgh faced challenges in Q1 2025 due to lower interest rates and reduced average advances, leading to a decrease in net income. However, the Bank remains focused on managing its liquidity and funding strategies to support its operations and meet regulatory requirements. The economic outlook remains uncertain, but the Bank is positioned to navigate these challenges and continue to provide value to its member shareholders.