| Key Features
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- Adjustable rate
- Fixed term
- Nonamortizing
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| Common Uses
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- Limit basis risk when funding LIBOR-indexed assets.
- Manage balance-sheet interest-rate sensitivity.
- Fund various loan portfolios.
- Fund LIBOR-indexed mortgage-backed securities.
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| Maturities |
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| Index |
- LIBOR
(LIBOR is the London Interbank
Offered Rate, which refers to the rates that most
major international banks dealing in Eurodollar currency
charge each other for large loans)
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| Minimum |
- $10 million
- Requests for less than $10 million are subject
to funding availability.
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| Disbursement
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- Second-day if requested by 3:00 p.m.
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| Risks
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- The Federal Home Loan Bank of Boston does not act
as a financial adviser, and members should independently
evaluate the suitability and risks of these advances.
Please see the LIBOR-Indexed Advance Primer for a discussion
of the risks and other considerations associated
with the LIBOR-Indexed advance.
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| Rate-Reset
Frequency |
- Rate adjustment is typically every three months
based on a spread to LIBOR, which is locked in for
the full term of the advance.
- Monthly and semiannual rate resets are also available.
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| Payment of
Principal and Interest |
- Principal due at maturity.
- Interest due on rate-adjustment date.
- Interest is calculated on an actual/360-day basis.
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| Prepayment |
- Prepayable under some circumstances.
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| Forward Rate
Commitments |
- Lock in a guaranteed rate up to two years before
disbursement.
- Our forward rate commitment adds a premium to the
current rate.
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| More Information |
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