U.S. Central's February 2009 financials report a net income of $6 million; however, the month's additional $700 million in unrealized losses increases the corporate's running total to $6.6 billion.
"Credit spreads widened further in February, particularly for non-agency residential mortgage-backed securities. This widening was partly in response to downgrades in that sector and caused the fair values of the affected securities to decrease," wrote Senior Vice President and Chief Financial Officer Kathy Brick in a cover letter posted today on U.S. Central's Web site. (www.uscentral.org)
U.S. Central's non-agency RMBS portfolio had a book value of $17.9 billion as of February 28; however, the reported value was only $13 billion, which accounts for most of the corporate's unrealized losses.
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U.S. Central's Dec. 31 $1.2 billion OTTI was the result of impairments to non-agency RMBS.
February capital numbers still report a nearly $450 million accumulated deficit, formerly known as retained earnings back when it was in the black. U.S. Central is slowly chipping away at the number, applying much of February's net profit to the capital bucket.
The corporate reported $1 billion in NCUSIF capital still on its books, as well as all $750 million of paid-in capital from member corporates.
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