=DJ More FHLBanks Likely To Restate Results,Miss SEC Filing
08/22/2005
Dow Jones News Services
(Copyright © 2005 Dow Jones & Company, Inc.)
By Dawn Kopecki
Of DOW JONES NEWSWIRES
WASHINGTON (Dow Jones)--Almost half of the nation's 12 regional Federal Home Loan Banks have said that accounting problems have tripped up their ability to register with the Securities and Exchange Commission, casting doubt on whether others in the $1 trillion system will be able to meet next week's filing deadline.
The home loan banks of Dallas and Atlanta said Monday that they will join facilities in Des Moines, Iowa, and Indianapolis on a growing list of home loan banks that have to restate several years of earnings stemming from problems with their accounting for certain derivatives transactions. All four said they won't be able to meet an Aug. 29 filing deadline with the SEC imposed by their regulator, the Federal Housing Finance Board.
Additionally, the FHLBank in Topeka, Kan., which earlier this year said it was restating its earnings, told Dow Jones Newswires on Monday that it too will miss the filing deadline. And officials at several other banks are unsure whether the system's auditors at PriceWaterhouseCoopers LLP or SEC officials will sign off on their registration statements in time.
"We are really engaged in this process, but we can't predict at this time whether we're going to make that regulatory deadline of August 29," said Melissa Dallas, spokeswoman for the FHLBank of Cincinnati.
Alfred DelliBovi, president and chief executive of the New York FHLBank, said his bank is "working very hard to be able to meet that deadline" and is "sure it will all work out and in the end we will make a filing that will satisfy (the SEC's) requirements."
An SEC spokesman declined to comment on Monday's developments.
The Finance Board has given the banks nearly two years to register with the SEC since it originally proposed bringing the system under the disclosure requirements of the 1934 Securities Exchange Act. Nine of the 12 FHLBanks, which have nearly $1 trillion in combined assets and $908 billion in jointly issued debt outstanding, filed preliminary registration statements with the SEC by the system's June 30 deadline. But August 29 is the final deadline before the SEC's disclosure requirements become fully effective for the system, which has long been exempt from most securities disclosure rules.
Finance Board rules give that regulator broad discretion in dealing with banks that fail to file on time, and options include assessing fines or extending the deadline, among other regulatory actions.
"We're constantly monitoring the progress of the banks throughout the registration process. We're weighing all options as we approach the deadline," Finance Board spokesman Doug Duvall said, declining to elaborate.
The FHLBanks of Atlanta, Dallas, Des Moines and Indianapolis each plan to restate their earnings from 2001 through the first quarter of 2005 largely due to problems with their application of Financial Accounting Standard 133, or FAS 133 for derivatives transactions.
Similar problems with FAS 133 also plagued the Topeka FHLBank. Topeka said in March, prior to publishing its 2004 earnings, that it needed to restate its results from 2001 through 2003.
Topeka's Chief Financial Officer Mark Yardley said new questions at other FHLBanks have cropped up during the registration process that impact the financial results of the broader system.
"Problems that have been brought up in discussions with the SEC that have to be resolved for the entire system are holding us up from issuing our results," Yardley said. "I think that's the same problem faced by the other banks. Issues that get brought up at one have to be resolved at the others."
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08-22-05 1719ET |
