Federal Home Loan Bank of Atlanta (the Bank) today released preliminary unaudited financial highlights for the quarter and year ended December 31, 2021. All numbers reported below for 2021 are approximate until the Bank announces audited financial results in its Form 10-K filing with the Securities and Exchange Commission (SEC), which is expected to be filed on or about March 3, 2022.
Net income for the fourth quarter of 2021 was $7 million, a decrease of $28 million, compared to net income of $35 million for the fourth quarter of 2020. The decrease in net income for the fourth quarter was primarily due to a $25 million decrease in net interest income. Net interest income for the fourth quarter of 2021 was reduced by $11 million due to derivative and hedging adjustments, while net interest income for the fourth quarter of 2020 benefited by $7 million of derivative and hedging adjustments. The derivative and hedging adjustments are driven by changes in interest rates. The remaining decrease in net interest income was primarily due to reduced advance balances and other interest-earning assets, partially offset by a decrease in interest rates which impacted interest-bearing liabilities more than interest-earning assets.
Net income for the year ended December 31, 2021 was $133 million, a decrease of $122 million, compared to net income of $255 million for 2020. Net interest income for 2021 decreased by $52 million, compared to net interest income in 2020. Derivative and hedging adjustments contributed to $26 million of the decrease in net interest income. The remaining decrease in net interest income was primarily due to reduced advance balances and other interest-earning assets, partially offset by a decrease in interest rates which impacted interest-bearing liabilities more than interest-earning assets. Additional items that impacted net income for 2020 included an $85 million gain from the sale of the Bank’s private-label mortgage-backed investment portfolio and a voluntary $20 million retirement plan contribution.
Total assets as of December 31, 2021 were $78.7 billion, a decrease of $13.5 billion, or 14.7 percent, from December 31, 2020. Advances outstanding were $45.4 billion as of December 31, 2021, a decrease of $6.8 billion, or 13.0 percent, from December 31, 2020, as a result of decreased demand for liquidity by the Bank’s members. Retained earnings were $2.2 billion as of December 31, 2021 and 2020. Capital stock was $2.4 billion as of December 31, 2021, a decrease of $695 million, or 22.6 percent, from $3.1 billion as of December 31, 2020. The decrease in capital stock was primarily attributable to the decrease in advances, as well as certain changes in members’ minimum capital stock requirements that the Bank implemented in March 2021.
The Bank’s 2021 performance resulted in an annualized return on average equity (ROE) of 2.79 percent as compared to 3.95 percent for 2020. The ROE spread to the average Secured Overnight Financing Rate decreased to 275 basis points for 2021, as compared to 359 basis points for 2020. As of December 31, 2021, the Bank was in compliance with its regulatory capital requirements.
| Federal Home Loan Bank of Atlanta Financial Highlights (Preliminary and unaudited) (Dollars in millions) |
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| Statements of Condition | As of December 31, 2021 | As of December 31, 2020 | ||||||
| Advances | $ | 45,415 | $ | 52,168 | ||||
| Investments | 31,821 | 36,380 | ||||||
| Mortgage loans held for portfolio, net | 149 | 218 | ||||||
| Total assets | 78,746 | 92,295 | ||||||
| Consolidated obligations, net | 71,692 | 84,764 | ||||||
| Total capital stock | 2,383 | 3,078 | ||||||
| Retained earnings | 2,228 | 2,198 | ||||||
| Accumulated other comprehensive loss | (16 | ) | (16 | ) | ||||
| Total capital | 4,595 | 5,260 | ||||||
| Capital-to-assets ratio (GAAP) | 5.84 | % | 5.70 | % | ||||
| Capital-to-assets ratio (Regulatory) | 5.86 | % | 5.72 | % | ||||
| Three Months Ended December 31, | Years Ended December 31, | |||||||||||||||
| Operating Results and Performance Ratios | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net interest income | $ | 44 | $ | 69 | $ | 281 | $ | 333 | ||||||||
| Reversal of provision for credit losses | (1 | ) | — | (1 | ) | — | ||||||||||
| Standby letters of credit fees | 2 | 3 | 11 | 19 | ||||||||||||
| Other income | 1 | 2 | 4 | 94 | ||||||||||||
| Total noninterest expense | 40 | 36 | 149 | 163 | ||||||||||||
| Affordable Housing Program assessment | 1 | 3 | 15 | 28 | ||||||||||||
| Net income | 7 | 35 | 133 | 255 | ||||||||||||
| Return on average assets | 0.03 | % | 0.14 | % | 0.16 | % | 0.19 | % | ||||||||
| Return on average equity | 0.58 | % | 2.53 | % | 2.79 | % | 3.95 | % | ||||||||
Additional financial information concerning the Bank’s results of operations for the most recently completed quarter and year ended December 31, 2021, will be available in the Bank’s Form 10-K that the Bank expects to file on or about March 3, 2022, with the Securities and Exchange Commission and will be available at www.fhlbatl.com or www.sec.gov.