The Federal Home Loan Bank
of Boston is the wholesale bank for housing finance in the six
New England states. Its mission is to support the residential-mortgage
and community-development lending activities of its member financial
institutions.
Products and Services
Use of the Bank's products and services helps members operate
profitably and offer their communities a wide range of financial
services. Members use their access to the Bank's loans, called
advances, to expand their home lending and to better manage
the financial risks associated with home-mortgage lending. The
Bank's Mortgage Partnership Finance® program offers members
a competitive alternative for funding mortgages for home buyers.
The Bank also offers its members many noncredit financial services.
The Bank actively promotes members' participation in affordable-housing
and community-development lending through Community Development
advances and the Affordable Housing Program. The Bank's Community
Development advances offer reduced-rate funding, and its Affordable
Housing Program awards below-market-rate advances and direct
grants. The Bank also provides technical assistance to help
members with their community-lending activities.
Regional Membership
Financial institutions throughout New England are the Bank's
members and customers. The Bank's members are the primary
providers of credit and financial services in New England.
Institutions eligible for membership include savings banks,
savings and loan associations, cooperative banks, commercial
banks, credit unions, and insurance companies that are active
in housing finance.
In addition to serving its members, the Bank is authorized
to lend for housing-finance purposes to certain nonmember
institutions. Currently, the Bank may lend to each of the
state housing-finance agencies in New England. Lending to
these agencies helps the Bank expand its ability to meet the
housing-finance needs of low- to moderate-income households.
New England Focus
While government-sponsored, the Bank is privately owned. All
stock is owned by the Bank's members. Members purchase and
hold stock as a percentage of their assets eligible as collateral
for advances and as a percentage of their business activity
(advances, loan sales, and so on) with the Bank. The stock
has a par value of $100 and, subject to the Bank remaining
in compliance with its capital requirements, can be redeemed
upon five years notice.
The Bank is governed by a board of directors. All
directors are New Englanders. Ten of the directors are
elected by member financial institutions. The remainder is
appointed from the public sector by the Federal Housing
Finance Agency, the Bank's regulator in Washington, D.C. The
Bank is part of the Federal Home Loan Bank System, which
is
composed of 12 regional Federal Home Loan Banks and more
than
8,000 member community-based lending institutions.
Prudent Management
The Bank's prudent financial management is the cornerstone
of all its activities. The Bank's primary source of income
is the spread between the interest it pays to borrow funds
and the interest it earns on funds lent to members. The Bank
borrows funds on a joint basis with the other regional Federal
Home Loan Banks. The Federal Home Loan Banks borrow at favorable
rates because of their strong capital position, conservative
lending policies, and status as government-sponsored enterprises.
Borrowings by the Federal Home Loan Bank System include bonds
and discount notes and are rated triple-A by Moody's and Standard
and Poor's.
"Mortgage Partnership Finance"
and "MPF" are registered trademarks of the Federal
Home Loan Bank of Chicago.
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