Liquidity

The foundational public purpose of the FHLBank System is its liquidity mission. The liquidity provided by FHLBanks to their members helps those members meet the lending needs of communities throughout America in all economic conditions.

Without the FHLBanks, it would be more difficult for local lending institutions to provide credit and financial services for families, farms, and businesses in every U.S. state and territory. The credit would be tighter and more expensive.

A recent University of Wisconsin study highlights that the FHLBank System increases mortgage originations by $130 billion and saves borrowers $13 billion in mortgage interest payments per year.

Liquidity is provided through a variety of products, including Advances, Letters of Credit (LOCs), and the Acquired Member Assets (AMA) program.

By regulation, each FHLBank establishes the terms and pricing for its own products, determines the types of FHLBank debt to issue to support its balance sheet and meet its members’ needs for funding, and manages its own liquidity and investment portfolios.

Click here to read more about the FHLBanks’ liquidity mission.

The FHLBank System increases mortgage originations by $130 billion and saves borrowers $13 billion in mortgage interest payments each year.