In a development that could have ominous implications for the Federal Home Loan Banks and their regulators, Washington Mutual Bank is launching a new bond program – mostly for European investors and backed by adjustable rate mortgages in the U.S. – as a source of funding that will serve as an alternative to advances from the FHLBank System, one of its traditional money trees. WaMu’s $26 billion program is the first use of a covered bond program collateralized by U.S. residential mortgage collateral...