By Paul Peduto

Here at the Federal Home Loan Bank of Boston we are constantly developing strategies to make it easier for members to borrow from us. Our primary goal is to ensure that our products are effectively meeting your needs.

In recent months, we have introduced a new Symmetrical Prepayment advance, in part to help members compete more effectively with dealer repos. We have also been developing a new attractively priced floating-rate advance that will be linked to the Bank's cost of funds. Our goal in developing these products is to provide members with more options and make borrowing easier.

In addition to new products, members can also take advantage of our weekly advance specials. In recent months, we have offered a wide range of specials, including advance specials in an auction format, Capped Floater advance specials, Knockout advance specials, and Symmetrical Prepayment advance specials.

To make these specials available to as many members as possible, we have relaxed our borrowing requirements and allowed members who can't meet the $10 million borrowing minimum for certain advances (Capped Floater, Knockout, and Symmetrical Prepayment advances) to join with other members to access these specials. By participating as a group, individual members can draw down a minimum of $1 million to meet the $10 million minimum requirement. Members using the group option receive the same terms as those drawing down the full $5 million special.

Capital Stock and Collateral We have also been reviewing our capital stock requirements for certain advances. In July, the Bank announced it would reduce the activity stock required for overnight activity from 4.5 percent to 3 percent. This reduction will be available for overnight advances disbursed after August 15, 2005 (see article). We are also considering introducing a class of stock with a six-month rather than five-year redemption feature that would be available for short-term advances of a year or less.

On the collateral front, we have made HELOCs (loans disbursed under open-ended home equity lines of credit) eligible as collateral. We are also streamlining procedures to allow members to pledge assets other than one- to four-family properties and securities to increase borrowing capacity in anticipation of future borrowing needs. We are reviewing all of our collateral requirements to ensure that our borrowing procedures are sensible and convenient.

Many of these changes are in response to your suggestions and address specific member needs. We at the Bank take seriously the cooperative nature of our work and strive to be responsive to your concerns.

If you have suggestions or feel our procedures in any way inhibit members' ability to make the most effective use of their membership, please don't hesitate to contact me, your relationship manager, M. Susan Elliott (executive vice president / member services), or Michael A. Jessee (president and chief executive officer).

We want your business and continue to rely on your input to know what works best for you.

For more information about Bank products and services, please contact me at 617-292-9762, or call John Baity at 617-292-9710; David Birkins at 617-292-9617; or Steve McHugh at 617-292-9616.

Paul M. Peduto is first vice president / sales and business development at the Federal Home Loan Bank of Boston.