A refinancing prepayment penalty drove a fourth quarter and fiscal year loss for Capitol Federal Financial, the company said Monday.

For the three months ended Sept. 30, the Topeka-based banking company reported a loss of $130 million, or $1.78 a share, compared with earnings of $3 million, or 4 cents a share, for the same period a year ago.

The loss resulted from a $146.6 million prepayment penalty for refinancing $2.4 billion in advances from Federal Home Loan Bank, CapFed said.

Excluding the penalty, the company posted earnings of $16.6 million for the quarter.

For all of fiscal 2004, the company reported a loss of $106.3 million, or $1.46 a share, compared with earnings of $52 million, or 72 cents a share, a year ago.

Excluding the prepayment penalty, the company had earnings for the year of $40.3 million, down from $52 million a year ago.

The company said the decline in net income was related primarily to it not selling mortgage loans in 2004. A year ago, CapFed sold $591.6 million in single-family loans to the secondary market for a pre-tax gain of $18.5 million.

For the year, total assets decreased $41.8 million to $8.54 billion. CapFed said the decline was because of a decrease in investment securities and mortgage-related securities.

CapFed stock closed at $34.27 Monday on the Nasdaq market, unchanged from Friday’s close.

Capitol Federal Financial is the holding company for Capitol Federal Savings Bank, which has 36 branch locations in Kansas including four in Lawrence. CapFed employs 693 people and is one of the state’s largest originators of residential mortgage loans.