CINCINNATI, Feb. 19, 2026 /PRNewswire/ -- The Federal Home Loan Bank of Cincinnati (the FHLB) today released unaudited financial results for the year ended December 31, 2025.
Overview
Throughout 2025, the FHLB successfully delivered on its dual mission of providing ongoing access to liquidity funding for member financial institutions and continuing to support affordable housing and community investment. The FHLB also maintained strong profitability, which enabled it to pay a competitive return to stockholders, make meaningful contributions to affordable housing and strengthen capital by increasing retained earnings. Overall, the FHLB contributed $104 million to support affordable housing and community investment needs during 2025. Specifically, $64 million was allocated to the required Affordable Housing Program $(AHP)$ and $40 million was provided through the FHLB's voluntary housing programs. The FHLB's voluntary programs recognize that funding in addition to the required 10 percent statutory AHP assessment is beneficial to affordable housing and community investment.
Operating Results
-- Net income for 2025 was $575 million and return on average equity $(ROE)$ was 8.45 percent, compared to net income of $608 million and ROE of 9.48 percent for 2024. For the fourth quarter of 2025, net income was $137 million and ROE was 8.11 percent. This compares to net income of $154 million and ROE of 9.53 percent for the same period of 2024. -- The decreases in net income in both periods of 2025 compared to the same periods of 2024 were primarily due to lower average interest rates, which decreased the earnings generated from investing the FHLB's capital in interest-earning assets, and lower spreads earned on mortgage loans held for portfolio. The factors decreasing net income were partially offset by the positive impact of higher average balances of interest-earning assets.
Financial Condition Highlights
-- Total assets at December 31, 2025 were $129.4 billion, a decrease of $2.9
billion (two percent) from year-end 2024.
-- Mission Assets and Activities -- comprising the major products we offer
to members including Advances, Letters of Credit (off-balance sheet), and
the Mortgage Purchase Program -- were $125.3 billion at December 31,
2025, a decrease of $10.3 billion (eight percent) from year-end 2024. The
decrease in Mission Assets and Activities from year-end 2024 was
primarily driven by modest reductions in Advance borrowings from a few
large-asset members. The FHLB's business model is designed to support
significant changes in mission asset and activity levels without having
to undergo material changes in staffing, operations, risk practices, or
general resource needs.
-- Total investments at December 31, 2025 were $50.1 billion, an increase of
$4.9 billion (11 percent) from year-end 2024, which was primarily driven
by an increase in liquidity investments. Total investments included $20.0
billion of mortgage-backed securities issued by Fannie Mae, Freddie Mac
or Ginnie Mae and $30.1 billion of liquidity investments. Liquidity
investments can vary significantly on a daily basis to support actual and
anticipated borrowing needs of members and to meet all current and
anticipated financial commitments.
-- At December 31, 2025, GAAP capital was $6.5 billion, a decrease of three
percent from year-end 2024. The GAAP and regulatory capital-to-assets
ratios were 5.05 percent and 5.06 percent, respectively, at December 31,
2025. Both ratios exceeded the regulatory required minimum of four
percent. Retained earnings were $2.0 billion at December 31, 2025, an
increase of $0.2 billion (eight percent) from year-end 2024. The current
amount of retained earnings exceeds the FHLB's minimum policy
requirements in order to protect its capital stock against impairment
risk and provide for dividend stability.
Dividend
-- The FHLB paid its stockholders a cash dividend on December 18, 2025 at an
8.00 percent annualized rate, which was 4.01 percentage points above the
fourth quarter average Secured Overnight Financing Rate. The annualized
dividend rate for all of 2025 was 8.62 percent.
Housing and Community Investment
-- Statutory Affordable Housing Program (AHP) Assessments. The FHLB is
required to annually set aside 10 percent of its profits to support
affordable housing. These funds assist members in serving very low-, low-,
and moderate-income households. The FHLB's net income for 2025 resulted
in an accrual of $64 million to the AHP pool of funds, which will be
awarded to members in 2026 through the AHP offerings. The AHP consists of
a competitive program, which supports the creation and preservation of
affordable housing, and a homeownership program called Welcome Home,
which assists homebuyers with down payments and closing costs.
-- Voluntary Housing Contributions. In addition to the statutory AHP
assessment, the Board of Directors may elect to make voluntary
contributions to the AHP or other housing and community investment
activities. In 2025, the FHLB made voluntary contributions of $36 million,
representing five percent of 2024 earnings, to various voluntary housing
and community investment programs. The FHLB also made a $4 million
supplemental voluntary AHP contribution in 2025 to ensure the amount of
total AHP contributions equals what it would have been absent any
voluntary housing contributions, which reduce net income before
assessments and statutory AHP assessments.
The FHLB expects to file its 2025 Form 10-K with the Securities and Exchange Commission on or about March 19, 2026.
About the FHLB
The FHLB is a AA+ rated wholesale cooperative bank owned by 599 member financial institutions, including commercial banks, thrifts, credit unions, insurance companies and community development financial institutions in Kentucky, Ohio and Tennessee. The FHLB provides members access to products and services (primarily Advances, which are a readily available, low-cost source of funds, purchases of certain mortgage loans from members, and issuance of Letters of Credit to members) and a competitive return through quarterly dividends on their capital investment in the FHLB. The FHLB funds these products and services by raising private-sector capital from member-stockholders and, with the other Federal Home Loan Banks (FHLBanks) in the FHLBank System, issuing high-quality debt in the global capital markets. The FHLB also funds community investment programs that help its members create affordable housing and promote community economic development.
This news release may contain forward-looking statements that are subject to risks and uncertainties that could affect the FHLB's financial condition and results of operations. These include, but are not limited to: the effects of economic, financial, and market conditions; legislative or regulatory developments concerning the FHLBank System; financial pressures affecting other FHLBanks; pandemics; competitive forces; and other risks detailed from time to time in the FHLB's annual report on Form 10-K and other filings with the Securities and Exchange Commission. The forward-looking statements speak as of the date made and are not guarantees of future performance. Actual results or developments could differ materially from the expectations expressed or implied in the forward-looking statements, and the FHLB undertakes no obligation to update any such statements.
Federal Home Loan Bank of Cincinnati
Financial Highlights (unaudited)
Dollars in millions
SELECTED BALANCE SHEET ITEMS
December 31, December 31, Percent
2025 2024 Change (2)
------------- ------------- -----------
Total assets $ 129,405 $ 132,328 (2) %
Advances (principal) 70,104 79,545 (12)
Mortgage loans held for
portfolio (principal) 8,490 7,093 20
Total investments 50,079 45,139 11
Consolidated Obligations 120,775 123,327 (2)
Mandatorily redeemable capital
stock 20 14 39
Capital stock 4,539 4,936 (8)
Total retained earnings 1,995 1,839 8
Total capital 6,540 6,737 (3)
Regulatory capital (1) 6,554 6,789 (3)
Capital-to-assets ratio (GAAP) 5.05 % 5.09 %
Capital-to-assets ratio
(Regulatory) (1) 5.06 5.13
OPERATING RESULTS
Three Months Ended December For the Years Ended December
31, 31,
-----------------------------
Percent Percent
Change Change
2025 2024 (2) 2025 2024 (2)
-------- -------- --------- -------- -------- ---------
Total interest
income $ 1,439 $ 1,565 (8)% $ 6,164 $ 6,675 (8)%
Total interest
expense 1,256 1,376 (9) 5,396 5,875 (8)
-------- -------- -------- --------
Net interest
income 183 189 (3) 768 800 (4)
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