U.S. Central Federal Credit Union reported late Monday that growing losses on its portfolio of private-label mortgage-backed securities created a $39.4 million loss for its second quarter, and an $84.8 million loss for the first-half of the year.

While the performance was much improved from last year's first half ($983 million of red ink) it reflects a growing realization of losses that were previously projected or unrealized. For example, second quarter results show actual principal losses on 65 impaired securities totaling $128 million. For the entire first half the results are worse: principal losses on 71 securities totaling $397 million, indicating that there is no hope for recovery on these investments.

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