How a Bet on Rates Went Wrong for FHLB of Seattle. (cover story)

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  • Additional Information
    • Subject Terms:
      UNITED States
    • Subject Terms:
      FEDERAL Home Loan Bank of Seattle (Company) 083739763
    • Abstract:
      Focuses on a bet on interest by the Federal Home Loan Bank of Seattle gone-wrong. Purchasing of the callable debt of other home loan banks and financing the investment with borrowings that were partly short-term and mostly noncallable; Question on why the Home Loan bank took the gamble after acknowledging that problems with its mortgage program showed shortcoming in its interest rate risk management; Cause of the bad call, which is attributed to a reluctance to make changes that would have been unpopular with members because they would have raised taxes and lowered profits from investing.