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Company Info: Frequently Asked Questions
What is the Federal Home Loan Bank of San Francisco? The Bank is a cooperative, wholesale bank, not a retail bank with branches and tellers. Our core business is to make loans (we call them “advances”) to our member financial institutions — our shareholders and customers. Our ability to borrow at favorable rates and terms allows us to provide our members with prompt access to low-cost loans to help them meet the housing finance and economic development needs of their communities. Top
What is the Federal Home Loan Bank System? The Federal Home Loan Bank of San Francisco is part of the Federal Home Loan Bank System, which was created by Congress in 1932 to promote housing finance nationwide. The System is made up of 12 regional wholesale FHLBanks, the Office of Finance, and the financial institutions that are members of the FHLBanks. The FHLBank System provides a stable source of readily available, low-cost funds to the financial institutions that are members of the FHLBanks. Each FHLBank is governed by a board of directors, and each FHLBank’s board is made up of member and independent directors elected by its member institutions. The FHLBanks are regulated by the Federal Housing Finance Agency, an independent federal agency in the executive branch of the U.S. government. Top
How do lenders and communities benefit from the FHLBanks? Direct borrowing from the capital markets is not an option for many financial institutions, especially small community lenders. The FHLBanks link their members to the capital markets and maintain a ready supply of liquidity to ensure that funds are immediately available when members need them. By providing short-, medium-, and long-term funding — tools essential for managing funding costs, liquidity, interest rate risk, and other financial risks — the FHLBanks enable their members to provide much-needed credit to their communities. Top
How do the Federal Home Loan Banks raise money to lend to members? The FHLBanks raise funds by issuing debt instruments (bonds and notes) in the capital markets. Because these instruments are rated Aaa by Moody's Investors Service and AA+ by Standard & Poor's, the FHLBanks can borrow at favorable rates and terms. FHLBanks are capitalized through stock purchased by member institutions and through retained earnings. FHLBanks do not receive any taxpayer assistance to operate. Top
Who are the members of the Federal Home Loan Bank of San Francisco? The Bank’s members may include federally insured depositories — commercial banks, credit unions, industrial loan companies, and savings institutions — as well as insurance companies and community development financial institutions, including privately insured, state-chartered credit unions, community development loan funds, and venture capital funds that are certified by the Community Development Financial Institutions Fund of the U.S. Department of the Treasury. Our members are headquartered in Arizona, California, and Nevada — the three states that make up the 11th District of the FHLBank System. Top
What financial products does the Bank offer? We offer a variety of products, including fixed and adjustable rate loans, embedded caps and floors, and standby letters of credit. We offer loan terms ranging from one day to 10 years or more, depending on the credit product, and customize our products to meet the specific needs of individual members. Members use our products to manage interest rate risk, lower funding costs, meet liquidity needs, and offer a wider range of credit products to their customers. Top
What are some of the programs the Bank offers to support affordable housing and economic development? We set aside 10% of our net income each year to fund our Affordable Housing Program. We award AHP grants to innovative and effective affordable housing projects on a competitive basis twice a year. We also award AHP grants through two homeownership set-aside program s— the Individual Development and Empowerment Account (IDEA) Program and the Workforce Initiative Subsidy for Homeownership (WISH) Program — which provide match funding for downpayment and closing cost assistance for qualified households. Our Access to Housing and Economic Assistance for Development (AHEAD) Program provides grants to support economic development and housing projects during the conception and early development stages. We also offer several below-market-rate credit programs, which are used to fund housing development, homeownership preservation, or other projects for low- and moderate-income families and communities. Top
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