President's Report

July 30, 2004

At the Bank

Board Approves Second Quarter Dividend at 2.08%

At its meeting on July 15, 2004, the Home Loan Bank’s Board of Directors declared a dividend of 2.08% for the second quarter of 2004. The dividend will be paid from second quarter earnings on July 30, 2004. In keeping with the Bank’s 2004 Retained Earnings Policy, approximately 50% of the Bank’s net income for the quarter will be added to the Bank’s retained earnings, and the remaining 50% will be paid in the form of a dividend to our shareholders. This dividend declaration continues the Bank’s policy of increasing retained earnings to further insulate member capital stock from financial risk. After the payment of the $20.16 million second quarter dividend, the Bank’s retained earnings will be approximately $157 million.

Average advances were $62.5 billion for the month of June. This is a $1.8 billion decrease from May’s average. We closed the month of June at $63.54 billion. Through our competitive pricing, innovative products, and exceptional service, we look forward to providing you with sustained performance and greater value for your investment in the Bank.

A significant portion of advances have rolled off our books due to the loss of The Dime Savings Bank and Summit Bank as members. Both were significant users of advances and both were acquired by lending institutions (Washington Mutual and Fleet Bank) who have membership in other Home Loan Banks. In order to try to mitigate this loss and maintain the regional connection of these institutions, the Home Loan Bank of New York requested the Federal Housing Finance Board to allow limited multi-district membership in 2001. At the time that Summit was acquired by Fleet and the Dime was acquired by WAMU, these institutions had a total of $9.9 billion in advances on our books. Since then $5.3 billion have rolled off. And in the next six years the lion's share of remaining $4.6 billion will also roll off as a result of the inaction on our petition for limited multi-district membership.

The dividend paid from second quarter earnings will be credited to our members’ demand accounts on July 30, 2004. This information can also be accessed on the Combined Daily Advice within the Info Reporting Module under the Special Report Tab on 1Linksm, the Bank's Internet banking service.

As indicated in previous communications, it is likely that future dividend announcements for the year will be below 2%.

Additional FHLBank Stockholder Luncheons Set for August

The Home Loan Bank is set to hold five additional stockholder events in New York and New Jersey. If you have not already done so, please sign up and join other Home Loan Bank member lenders in your area to discuss important issues affecting our industry. Below are the locations and dates of the remaining stockholder luncheons:


Wednesday, August 4


Thursday, August 5


Friday, August 6


Wednesday, August 11


Thursday, August 12

Fanny's, Buffalo


Pascale Wine Bar Restaurant (dinner), Syracuse


Jack's Oyster House, Albany


The Oyster Point Hotel, Red Bank


Stony Hill Inn, Hackensack


Those who have not attended one of our luncheons and would find it convenient to attend one of those above please call Candice Soldano, Manager of Marketing Communication, at (212) 441-6773. Our stockholders are welcome at any one of these meetings.

Republican National Convention

As you are aware, from Monday, August 30, through Thursday, September 2, the Republican National Convention will be held at Madison Square Garden. We have been advised that during that week, transportation through Pennsylvania Station is likely to be subject to considerable delays. Since a large percentage of the Bank’s employees are New Jersey residents, we have made arrangements for many of them to work at our facility in Jersey City for the duration of the convention. As all critical Bank functions will be staffed at both locations, we will be able to conduct business from either location should the need arise. Your staff should continue to use the phone numbers they normally use to contact the Bank that week; we will route your calls to the individuals at the appropriate location.

In Washington

ACB, ABA, FHLB Council, ICBA, and Financial Services Round Table
to Hold Home Loan Bank Issues Forum in September

On July 27 America's Community Bankers, the American Bankers Association, the Council of Federal Home Loan Banks, the Independent Community Bankers of America and the Housing Policy Council of the Financial Services Roundtable announced plans to hold an issues forum on September 14 and 15 in Washington, DC. The forum will allow stockholders to consider and weigh in on such important matters as: regulatory restructuring of the GSEs, SEC registration, retained earnings and multi-district membership.

Invited guests are Senate Banking Chairman Richard Shelby and House Financial Services Committee Ranking Member Barney Frank. Treasury Under Secretary Brian Roseboro is a confirmed speaker.

Should you wish to attend the forum, please contact one of the trade groups or Eric Amig, Vice President and Director of Bank Relations, at (212) 441-6807 or

In closing, I would like to thank you, our members, for using our products and services to help you meet the credit needs of your communities. Through your lending efforts, you give families and individuals the opportunity to achieve their dreams of homeownership, and you create safer, stronger, and more prosperous communities.


Alfred A. DelliBovi
President & CEO

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Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This report may contain forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as “projected,” “expects,” “may,” or their negatives or other variations of these terms. The Bank cautions that, by their nature, forward-looking statements involve risk or uncertainty and that actual results could differ materially from those expressed or implied in these forward-looking statements or could affect the extent to which a particular objective, projection, estimate, or prediction is realized. These forward-looking statements involve risks and uncertainties including, but not limited to, regulatory and accounting rule adjustments or requirements, changes in interest rates, changes in projected business volumes, changes in prepayment speeds on mortgage assets, the cost of our funding, changes in our membership profile, the withdrawal of one or more large members, competitive pressures, shifts in demand for our products, and general economic conditions. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

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