Protects against falling rates
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Inflation Expectations, Interest-Rate Volatility, and Considerations for Funding
Operation Epic Fury in Iran has coincided with a surge in oil price volatility, a widening of Treasury Inflation-Protected Securities (TIPS)-implied breakevens, and an increase in Treasury yields, particularly at the front end of the curve. Depository institutions should review their assumptions about the distribution of interest-rate outcomes this year and consider how they are positioned to perform if interest-rate volatility continues to trend upward. FHLBank Boston can help banks and credit unions maintain funding stability and balance sheet resilience amid rising-rate uncertainty.
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Strategic Implications of Commercial Real Estate Loan Repricing Wave
Over the next two years, commercial real estate (CRE) loans originated from 2020 through 2022 will reprice into a very different rate and macro environment. How that repricing wave affects debt-service coverage ratios (DSCRs), valuations, earnings, and capital, and putting the right credit, liquidity, and funding strategies in place – including leveraging FHLBank Boston products – while the planning window is still open is crucial.
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Advance Solutions for Funding Construction Lending
Utilizing advances for construction loans can keep interest-rate and liquidity risks manageable and align funding with the characteristics of the loans.
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Quantitative Tightening, Volatility, and Considerations for Funding
At the October Federal Open Market Committee (FOMC) meeting, the FOMC statement indicated that reduction of the Fed’s balance sheet will end December 1, 2025, earlier than many in the market expected. The end of Quantitative Tightening may have implications for interest-rate volatility. FHLBank Boston offers advances with embedded options, like the HLB-Option and Member-Option Advance, for navigating interest-rate changes.
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Advance Restructuring Strategies to Enhance Earnings
Restructuring advances can improve earnings and interest-rate risk profiles without adding incremental funding.
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Funding Spread Lending Opportunities for Insurance Companies
As asset spreads become volatile and widen, insurance company members have several funding solutions to take advantage of spread lending opportunities. Whether the target assets are fixed-rate or floating-rate, with prepayable principal or in bullet structures, FHLBank Boston advances enable members to mitigate interest-rate risk and align asset and liability cash flows.
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Callable SOFR-Indexed Floater Advance
The Callable SOFR-Indexed Floater combines the benefits of long-term funding with adjustable-rate exposure, while also providing the flexibility to prepay without a fee at certain intervals.
