UPDATE 1-FHLB-Chicago appoints Feldman as President, CEO

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NEW YORK, May 6 (Reuters) - The Federal Home Loan Bank of Chicago on Tuesday said it appointed Matthew Feldman as its president and chief executive officer.

Feldman has been the bank's acting president since April 11, after his predecessor Mike Thomas decided to leave his positions as president and CEO following the decision of the FHLB Chicago and FHLB Dallas to abandon their plan to merge.

In late April, FHLB Chicago said it would halt its mortgage purchase program. Losses from that program, reduced its capital levels and the end of a merger with the FHLB of Dallas spurred ratings agency to Standard & Poor's to consider downgrading the credit quality of the FHLB Chicago.

Feldman had been the executive vice president of operations and administration at the FHLB Chicago. He joined the bank in 2003.

FHLB Chicago is one of 12 district banks in the Federal Home Loan Bank system, which was created by Congress in 1932 to promote home ownership.

Like Fannie Mae and Freddie Mac, FHLB banks provide funds to banks and lenders to make mortgages to consumers.

The Federal Home Loan Bank system was profitable in the first quarter, but a net loss of $78 million at the FHLB Chicago acted as a drag on overall results.

Combined assets of all member banks were $1.323 trillion at the end of March, up 4 percent in the first quarter. (Reporting by Richard Leong and Lynn Adler; Editing by Theodore d'Afflisio)