FHLBNY Net Income Plunges 20% Amidst Declining Advances
| Field | Detail |
|---|---|
| Company | Federal Home Loan Bank Of New York |
| Form Type | 10-Q |
| Filed Date | Nov 6, 2025 |
| Risk Level | medium |
| Pages | 15 |
| Reading Time | 18 min |
| Sentiment | bearish |
Sentiment: bearish
Topics: FHLBNY, Net Income Decline, Advances Decrease, Cash Flow Negative, Financial Performance, Government-Sponsored Enterprise, Housing Finance
TL;DR
**FHLBNY's shrinking advances and plummeting net income signal a tough environment for regional banks, making it a cautious hold for now.**
AI Summary
The Federal Home Loan Bank of New York (FHLBNY) reported a significant decline in net income for both the three and nine months ended September 30, 2025, compared to the same periods in 2024. Net income for the three months decreased by 12.8% to $159.7 million from $183.4 million, while the nine-month net income dropped by 19.9% to $468.5 million from $585.2 million. This decline was primarily driven by a substantial reduction in total interest income, which fell from $2.3 billion to $1.85 billion for the three-month period and from $6.9 billion to $5.57 billion for the nine-month period, largely due to lower interest income from advances. Total assets also decreased to $155.4 billion as of September 30, 2025, from $160.3 billion at December 31, 2024, mainly due to a reduction in advances from $105.8 billion to $96.2 billion. Despite the income decline, total capital decreased only slightly from $8.41 billion to $8.13 billion, supported by an increase in restricted retained earnings from $1.21 billion to $1.30 billion. The bank also saw a significant net cash outflow from operating activities of $827.2 million for the nine months ended September 30, 2025, a stark contrast to the $433.9 million inflow in the prior year.
Why It Matters
This significant drop in net income and advances for the Federal Home Loan Bank of New York signals a potential shift in demand for liquidity from its member institutions, which include banks, credit unions, and insurance companies in New Jersey, New York, Puerto Rico, and the U.S. Virgin Islands. For investors, this could indicate reduced profitability and potentially lower future dividends, as cash dividends per share decreased from $7.18 to $6.07 year-over-year. Employees might face pressure if the trend continues, although compensation and benefits expenses increased slightly. Customers of member institutions could see indirect impacts if FHLBNY's reduced lending capacity affects the availability or cost of credit. In the broader market, a slowdown in FHLBank activity could reflect tighter credit conditions or reduced housing market activity, impacting the competitive landscape for financial institutions.
Risk Assessment
Risk Level: medium — The FHLBNY experienced a 19.9% decrease in net income for the nine months ended September 30, 2025, to $468.5 million, compared to $585.2 million in the prior year. This is primarily driven by a substantial $1.14 billion reduction in interest income from advances. Additionally, the bank reported a significant net cash outflow from operating activities of $827.2 million for the nine months ended September 30, 2025, a sharp reversal from the $433.9 million inflow in the same period of 2024, indicating operational challenges.
Analyst Insight
Investors should closely monitor FHLBNY's future filings for stabilization in interest income from advances and a return to positive cash flow from operations. Given the decline in net income and cash flow, a cautious approach is warranted, potentially re-evaluating exposure to FHLBNY's capital stock or related financial instruments.
Financial Highlights
- revenue
- $1.85B
- total Assets
- $155.4B
- net Income
- $159.7M
- revenue Growth
- -20.0%
Revenue Breakdown
| Segment | Revenue | Growth |
|---|---|---|
| Interest Income from Advances | $1.2B | -25.0% |
| Interest Income from Advances | $3.67B | -23.5% |
Key Numbers
- $159.7M — Net Income (Q3 2025) (12.8% decrease from Q3 2024's $183.4M)
- $468.5M — Net Income (YTD Q3 2025) (19.9% decrease from YTD Q3 2024's $585.2M)
- $1.2B — Interest Income from Advances (Q3 2025) (Decreased from $1.6B in Q3 2024)
- $3.67B — Interest Income from Advances (YTD Q3 2025) (Decreased from $4.8B in YTD Q3 2024)
- $155.4B — Total Assets (Sept 30, 2025) (Decreased from $160.3B at Dec 31, 2024)
- $96.2B — Advances (Sept 30, 2025) (Decreased from $105.8B at Dec 31, 2024)
- $8.13B — Total Capital (Sept 30, 2025) (Decreased from $8.41B at Dec 31, 2024)
- $827.2M — Net Cash Used in Operating Activities (YTD Q3 2025) (Reversal from $433.9M cash provided in YTD Q3 2024)
- $6.07 — Cash Dividends Per Share (YTD Q3 2025) (Decreased from $7.18 in YTD Q3 2024)
- 55,820 — Class B Capital Stock Shares Outstanding (Sept 30, 2025) (Decreased from 60,144 at Dec 31, 2024)
Key Players & Entities
- Federal Home Loan Bank of New York (company) — registrant
- $159,741 (dollar_amount) — net income for three months ended September 30, 2025
- $183,363 (dollar_amount) — net income for three months ended September 30, 2024
- $468,461 (dollar_amount) — net income for nine months ended September 30, 2025
- $585,197 (dollar_amount) — net income for nine months ended September 30, 2024
- $155,434,482 (dollar_amount) — total assets as of September 30, 2025
- $160,299,948 (dollar_amount) — total assets as of December 31, 2024
- $96,219,305 (dollar_amount) — advances as of September 30, 2025
- $105,838,238 (dollar_amount) — advances as of December 31, 2024
- $827,154 (dollar_amount) — net cash used in operating activities for nine months ended September 30, 2025
FAQ
What caused the Federal Home Loan Bank of New York's net income to decrease in Q3 2025?
The Federal Home Loan Bank of New York's net income decreased primarily due to a significant reduction in total interest income. For the three months ended September 30, 2025, total interest income fell to $1.85 billion from $2.32 billion in the prior year, largely driven by a decrease in interest income from advances from $1.61 billion to $1.20 billion.
How did the Federal Home Loan Bank of New York's total assets change as of September 30, 2025?
As of September 30, 2025, the Federal Home Loan Bank of New York's total assets decreased to $155.4 billion from $160.3 billion at December 31, 2024. This decline was mainly attributable to a reduction in advances, which fell from $105.8 billion to $96.2 billion.
What was the Federal Home Loan Bank of New York's cash flow from operating activities for the nine months ended September 30, 2025?
For the nine months ended September 30, 2025, the Federal Home Loan Bank of New York reported a net cash outflow from operating activities of $827.2 million. This is a significant change from the same period in 2024, which saw a net cash inflow of $433.9 million.
Did the Federal Home Loan Bank of New York's capital stock change in 2025?
Yes, the number of outstanding shares of Class B capital stock for the Federal Home Loan Bank of New York decreased to 55,820 as of September 30, 2025, from 60,144 at December 31, 2024. The total capital also decreased from $8.41 billion to $8.13 billion during this period.
How much did the Federal Home Loan Bank of New York pay in cash dividends per share for the nine months ended September 30, 2025?
The Federal Home Loan Bank of New York paid cash dividends of $6.07 per share for the nine months ended September 30, 2025. This represents a decrease from the $7.18 per share paid during the same period in 2024.
What is the purpose of the Affordable Housing Program Assessments for the Federal Home Loan Bank of New York?
The Affordable Housing Program Assessments require the Federal Home Loan Bank of New York, along with other FHLBanks, to allocate the greater of $100 million or 10% of their regulatory defined net income annually. These funds provide subsidies through direct grants and below-market interest rate advances to members for housing assistance for very low-, low-, and moderate-income households.
What are the key risks identified in the Federal Home Loan Bank of New York's 10-Q filing?
The 10-Q filing indicates a 'Risk Factors' section (Item 1A) on page 117, suggesting that the company has identified and disclosed specific risks. While the summary doesn't detail them, the overall financial performance, including declining net income and negative operating cash flow, points to potential market and operational risks.
Is the Federal Home Loan Bank of New York exempt from federal taxes?
Yes, the Federal Home Loan Bank of New York, like other FHLBanks, is exempt from ordinary federal, state, and local taxation, with the exception of real property taxes. This tax status is due to its federally chartered corporation status.
How did the Federal Home Loan Bank of New York's consolidated obligations change?
The Federal Home Loan Bank of New York's total consolidated obligations decreased to $143.3 billion as of September 30, 2025, from $148.4 billion at December 31, 2024. This was primarily driven by a reduction in consolidated obligation discount notes from $67.86 billion to $60.97 billion.
What was the change in the Federal Home Loan Bank of New York's retained earnings?
The Federal Home Loan Bank of New York's total retained earnings increased to $2.59 billion as of September 30, 2025, from $2.50 billion at December 31, 2024. This increase was mainly due to a rise in restricted retained earnings from $1.21 billion to $1.30 billion.
Risk Factors
- Interest Rate Sensitivity [high — market]: The FHLBNY's profitability is highly sensitive to changes in interest rates. A decline in interest income, as seen in the reported periods, directly impacts net income. For the three months ended September 30, 2025, total interest income decreased to $1.85 billion from $2.3 billion in the prior year.
- Reduced Lending Activity [high — financial]: A significant decrease in advances from $105.8 billion to $96.2 billion as of September 30, 2025, indicates reduced lending activity. This reduction in the core business asset directly correlates with the decline in interest income.
- Negative Operating Cash Flow [high — operational]: The FHLBNY experienced a net cash outflow from operating activities of $827.2 million for the nine months ended September 30, 2025, a substantial reversal from a $433.9 million inflow in the prior year. This indicates potential liquidity pressures or significant working capital changes.
- Regulatory Compliance [medium — regulatory]: As a Federal Home Loan Bank, the FHLBNY operates under strict regulatory oversight. Changes in regulatory requirements or failure to comply could lead to penalties or operational restrictions, impacting its ability to serve members.
- Economic Downturn Impact [medium — market]: A broader economic downturn could lead to decreased demand for advances from member institutions, further impacting the FHLBNY's revenue and asset levels. The current decrease in advances suggests a potential early indicator of this.
Industry Context
The Federal Home Loan Bank system operates as a government-sponsored enterprise providing liquidity to member financial institutions. The industry is characterized by stable, regulated operations focused on supporting housing finance and community development. Recent trends may include adapting to evolving interest rate environments and member needs for funding.
Regulatory Implications
As a regulated entity, the FHLBNY is subject to oversight by the Federal Housing Finance Agency (FHFA). Changes in capital requirements, liquidity rules, or permissible activities mandated by the FHFA could significantly impact the bank's operations and financial performance.
What Investors Should Do
- Monitor interest income trends
- Analyze the drivers of negative operating cash flow
- Assess the impact of reduced advances
- Review capital adequacy and trends
Key Dates
- 2025-09-30: FHLBNY 10-Q Filing (Q3 2025) — Provides updated financial performance and condition, highlighting a decline in net income and total assets.
- 2024-09-30: FHLBNY 10-Q Filing (Q3 2024) — Serves as the comparative period for the Q3 2025 results, showing higher net income and interest income.
- 2024-12-31: FHLBNY Year-End Statement — Represents the prior year-end financial position, used as a baseline for asset and capital changes as of September 30, 2025.
Glossary
- Advances
- Loans made by the FHLBNY to its member institutions, which are a primary source of funding for these members. (A significant portion of FHLBNY's assets and interest income is derived from advances. The decrease in advances directly impacts revenue.)
- Total Capital
- Represents the sum of capital stock, additional paid-in capital, retained earnings, and accumulated other comprehensive income. (Indicates the financial strength and solvency of the FHLBNY. A slight decrease from $8.41B to $8.13B is noted.)
- Restricted Retained Earnings
- A portion of retained earnings that is subject to certain restrictions, often related to regulatory requirements or dividend policies. (An increase in this component of capital suggests a conservative approach to capital management or specific regulatory requirements.)
- Net Cash Used in Operating Activities
- The net amount of cash used or generated by the normal day-to-day business operations of the company. (A significant outflow here ($827.2M YTD Q3 2025) is a negative indicator of operational cash generation and a reversal from the prior year's inflow.)
- Class B Capital Stock Shares Outstanding
- The number of shares of Class B capital stock held by members of the FHLBNY. (A decrease in these shares (from 60,144 to 55,820) may indicate a reduction in membership or a change in member investment levels.)
Year-Over-Year Comparison
Compared to the prior year's filings, the FHLBNY has experienced a notable downturn. Net income for the nine months ended September 30, 2025, fell by 19.9% to $468.5 million, primarily due to a substantial decrease in total interest income, down from $6.9 billion to $5.57 billion. Total assets also contracted to $155.4 billion from $160.3 billion, driven by a reduction in advances. A significant shift to negative operating cash flow, from an inflow of $433.9 million to an outflow of $827.2 million, is a key divergence indicating increased operational cash burn.
Filing Stats: 4,464 words · 18 min read · ~15 pages · Grade level 19.1 · Accepted 2025-11-06 15:46:56
Filing Documents
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- fhlbny-20250930xex31d01.htm (EX-31.01) — 12KB
- fhlbny-20250930xex31d02.htm (EX-31.02) — 13KB
- fhlbny-20250930xex32d01.htm (EX-32.01) — 6KB
- fhlbny-20250930xex32d02.htm (EX-32.02) — 6KB
- fhlbny-20250930x10q036.jpg (GRAPHIC) — 49KB
- 0001104659-25-107699.txt ( ) — 33477KB
- fhlbny-20250930.xsd (EX-101.SCH) — 139KB
- fhlbny-20250930_cal.xml (EX-101.CAL) — 175KB
- fhlbny-20250930_def.xml (EX-101.DEF) — 610KB
- fhlbny-20250930_lab.xml (EX-101.LAB) — 1157KB
- fhlbny-20250930_pre.xml (EX-101.PRE) — 901KB
- fhlbny-20250930x10q_htm.xml (XML) — 8863KB
FINANCIAL INFORMATION
PART I. FINANCIAL INFORMATION
Financial Statements (Unaudited)
Item 1. Financial Statements (Unaudited): 3 4 5 6 7
Notes to Financial Statements (Unaudited)
Notes to Financial Statements (Unaudited) 9
Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 59
Quantitative and Qualitative Disclosures about Market Risk
Item 3. Quantitative and Qualitative Disclosures about Market Risk 112
Controls and Procedures
Item 4. Controls and Procedures 116
OTHER INFORMATION
PART II. OTHER INFORMATION 117
Legal Proceedings
Item 1. Legal Proceedings 117
Risk Factors
Item 1A. Risk Factors 117
Unregistered Sales of Equity Securities and Use of Proceeds
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 117
Defaults Upon Senior Securities
Item 3. Defaults Upon Senior Securities 117
Mine Safety Disclosures
Item 4. Mine Safety Disclosures 117
Other Information
Item 5. Other Information 117
Exhibits
Item 6. Exhibits 118
Signatures
Signatures 119 2 Table of Contents Federal Home Loan Bank of New York As of September 30, 2025 and December 31, 2024 September 30, 2025 December 31, 2024 Assets Cash and due from banks (Note 3) $ 30,240 $ 26,141 Interest-bearing deposits (Note 4) 3,025,000 2,770,000 Securities purchased under agreements to resell (Note 4) 13,145,000 10,895,000 Federal funds sold (Note 4) 9,465,000 9,415,000 Trading securities (Note 5) (Includes $ 838,266 pledged as collateral at September 30, 2025 and $ 802,969 at December 31, 2024) 7,345,282 7,237,940 Equity Investments (Note 6) 103,409 95,422 Available-for-sale securities, amortized cost of $ 11,783,021 at September 30, 2025 and $ 10,152,921 at December 31, 2024 (Note 7) 11,703,379 9,987,284 Held-to-maturity securities, net of allowance for credit losses of $ 77 at September 30, 2025 and $ 649 at December 31, 2024 (Note 8) (Includes $ 0 pledged as collateral at September 30, 2025 and $ 2,144 at December 31, 2024) 11,094,796 10,865,935 Advances (Note 9) (Includes $ 0 at September 30, 2025 and December 31, 2024 at fair value under the fair value option) 96,219,305 105,838,238 Mortgage loans held-for-portfolio, net of allowance for credit losses of $ 3,470 at September 30, 2025 and $ 3,054 at December 31, 2024 (Note 10) 2,560,173 2,345,395 Accrued interest receivable 538,891 571,199 Premises, software, and equipment 79,999 78,966 Operating lease right-of-use assets (Note 19) 45,623 49,550 Finance lease right-of-use asset (Note 19) 1,649 2,003 Derivative assets (Note 17) 69,169 97,344 Other assets 7,567 24,531 Total assets $ 155,434,482 $ 160,299,948 Liabilities and capital Liabilities Deposits (Note 11) Interest-bearing demand $ 2,919,554 $ 2,415,356 Non-interest-bearing demand 4,031 14,028 Total deposits 2,923,585 2,429,