Reeling from charges related to its mortgage holdings, the Federal Home Loan Bank of Seattle reported deep losses late Monday and became the first bank in the system to exhaust its cushion of retained earnings.

The Seattle Home Loan Bank remains positively capitalized with stock used to satisfy membership requirements and advances but the depletion of the retained earnings fund, which totaled $162.3 million on Sept. 30, leaves the bank with almost $1.8 billion in total capital. That is below the regulatory risk-based capital requirement, which means the Home Loan bank is barred from paying dividends to shareholders or repurchasing capital stock.

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