Glossary

First mortgage loans on 1-4 family real estate.

Assets that may be purchased by the Bank from or through the Bank’s members or housing associates. These assets are held on the Bank’s balance sheet.

The common and preferred stock the Bank is authorized to issue. Activity Based Stock Requirement – The level of Activity Based Stock that a member must purchase and hold in order to obtain advances and engage in other transactions with the Bank.

Recorded unrealized and realized gains and losses on available for sale securities, derivatives held as cash flow hedges, currency translation, actuarial gains and changes in the revaluation surplus. Also called retained earnings.

A loan from the Bank to a member or housing associate that is provided pursuant to a written agreement; supported by a note or other written evidence of the borrower’s obligation and fully secured by collateral in accordance with the Bank Act.

The legal document outlining the terms and conditions of lending transactions between the Bank and the member or housing associate.

A document produced by the FHFA recommending actions and reactions to risk management or changes at the federal level.

The Affordable Housing Advisory Council consists of representatives drawn from community and non-profit organizations actively involved in providing or promoting very low-, low- and moderate income housing. The Advisory Council meets quarterly with representatives from the board of directors to advise the Bank on ways in which it can better carry out its affordable housing and community investment missions.

Any business entity that controls, is controlled by or is under common control with a member.

Grants the Bank a security interest in Mortgage, Securities and other collateral owned and pledged by affiliates of members. Affiliates report collateral mirroring member’s reporting requirements.

Securities represented by agency-backed, readily marketable, collateralized mortgage obligations and real estate mortgage investment conduits (excluding interest only, principal only and residual tranches) and accepted as collateral on a case-by-case basis.

United States Agency Securities include debt issued by the Federal Home Loan Banks, Farm Credit, Freddie Mac, Sallie Mae, Fannie Mae, Ginnie Mae, Fair Isaac Corporation, Small Business Administration and other government agency securities. Structured notes and bonds will be accepted on a case-by-case basis. The issues can be discount notes, bonds, mortgage-backed securities and, on a case-by-case basis, subordinated debentures and original issue zero coupons.

Secured loans to finance agricultural products and other loans to farmers that are within the legal lending limit of a Community Financial Institution.

Other Real Estate Related Collateral secured by a first mortgage on agricultural real estate. American Recovery and Reinvestment Act of 2009 – A spending bill introduced in 2009 to provide a stimulus to the United States economy in the wake of the economic downturn. The Act includes federal tax cuts, expansion of unemployment benefits and other social welfare provisions as well as domestic spending in education, health care, and infrastructure, including the energy sector. The Act also includes numerous non-economic recovery related items.

A flexible advance that allows members to choose amortization periods, years to maturity and payment options.

The Bank requires that residential mortgage collateral and purchased mortgage loans comply with applicable federal, state and local anti-predatory lending laws and other similar credit-related consumer protection laws, regulations and orders designed to prevent or regulate abusive and deceptive lending practices and loan terms.

The Bank management committee that oversees the Bank’s financial strategies, policies and performance, ensuring that they are consistent with the Bank’s mission, limits and strategic objections as approved by the Board of Directors and in compliance with applicable laws and regulations. ALCO also develops and communicates management’s recommendations to the board with respect to financial management, implications of new business initiatives and product strategies. ALCO reports to the Finance and Budget Committee of the board.

A discipline or technique for coordinating the management of assets and liabilities so that an appropriate return commensurate with the institution’s risk tolerance my be achieved.

To transfer ownership from one party to another

Mathematical average of returns over a period of time that tells an analyst or investor what the returns for a stock or security have been in the past.

The Federal Home Loan Bank of Des Moines.

The Federal Home Loan Bank System was created in 1932 by the Federal Home Loan Bank Act, which was enacted to restore confidence in the nation’s financial institutions and reestablish the housing market by ensuring the availability of funds for home financing.

A type of Advances, Pledge and Security Agreement whereby the member grants the Bank a security interest in all mortgage collateral, securities collateral and other collateral held by the member to secure indebtedness.

A form completed by a member or housing associate to summarize the loans pledged to the Bank to secure indebtedness.

Secured commercial and industrial loans that are within the legal lending limit of a Community Financial Institution.

A key component of a supervisory exam is a supervisory rating of a bank’s overall condition, commonly referred to as a CAMELS rating. This rating system is used by the three federal banking supervisors (Federal Reserve, Federal Deposit Insurance Company, Office of the Comptroller of the Currency) and other financial supervisory agencies to provide a convenient summary of bank conditions at the time of an exam. The acronym “CAMELS” refers to the six components of a bank’s condition that are assessed: Capital Adequacy, Asset Quality, Management, Earnings, Liquidity and Sensitivity.

The fee the Bank will impose upon a member that cancels or revokes a Notice of Redemption of Capital Stock or Notice of Withdrawal of Membership.

A member that fails to meet its minimum regulatory capital requirements as defined or otherwise required by the member’s appropriate federal banking agency, insurer or, in the case of members that are not federally insured depository institutions, state regulator.

The Bank’s capital structure plan, which was adopted pursuant to a mandate in the Gramm-Leach-Bliley Act of 1999.

A preferred stock and equity warrant purchase program conducted by the United States Treasury’s Office of Financial Stability as part of the 2008 Troubled Assets Relief Program.

Class B stock authorized under the Capital Plan.

A fixed-term, non-amortizing advance with an interest rate that adjusts every 30 or 90 days based on a predetermined spread to one- or three-month LIBOR.

Funds placed in time certificates at the Bank.

A fixed income security that uses mortgage-backed securities as collateral.

A quantitative scoring system utilized by the Bank to determine how often a Member Collateral Verification must be performed and by whom.

Large group of smaller-balance homogenous loans are checked for impairment that haven’t been restructured as troubled debt.

Commercial real estate mortgage-backed securities.

Other Real Estate Collateral secured by a first mortgage on commercial real estate.

Any legally binding agreement that requires the Bank to make an advance, acquire member assets or otherwise transact business with a member.

A unique entity established to provide credit, financial services and other services to underserved markets or populations. A CDFI has a primary mission of community development, serves a target market, is a financing entity, also provides development services, remains accountable to its community and is a non-government entity.

An institution that has its deposits insured under the Federal Deposit Insurance Act with average total assets over the preceding three-year period below a defined threshold, as adjusted annually by the Federal Housing Finance Agency. The Housing and Economic Recovery Act of 2008 increased the size of CFIs to $1 billion in assets from the previous limit of $625 million. As of January 1, 2022 the Federal Housing Finance Agency has increased the current CFI asset cap to $1.323 billion.

A discounted advance that can be used for a wide variety of purposes to meet local affordable housing and community development needs. There are two types – Residential and Commercial.

Advances for targeted economic development in small businesses or geographic locations.

FHLB Des Moines department that manages and oversees the Bank’s community investment advance (CIA) program and Affordable Housing Products, including a competitive Affordable Housing Program, Home$tart® and Native American Homeownership Initiative.

Action by the Community Investment Advance (CIA) program and volunteer efforts to help communities in need in the case of a community emergency or need for community development.

A competitive grant program administered by the Bank that benefits projects targeting families at or below 80 percent of the area median income.

Annualized percentage of the existing mortgage pool expected to be prepaid in a year assuming a constant percentage of mortgages will be prepaid.

A Bank commitment guaranteeing the obligation of a member that has issued a letter of credit.

An entity or organization subject to the legal control of an external entity or organization, known as a conservator.

The daily average carrying value for the calendar quarter, excluding the impact of fair value adjustments (i.e., fair value option and hedging adjustments), of the Bank’s portion of outstanding System Consolidated Obligations for which it is the primary obligor.

Other Real Estate Collateral secured by a first mortgage on real property for the purpose of constructing improvements to the real property. Eligible construction loans are limited to loans secured by non-speculative 1 – 4 family residential properties.

Convertible (putable) advances are (i) an advance that the Bank may, at its discretion, terminate and require the member to repay at predetermined dates prior to the stated maturity date of the advance, or (ii) an advance with a strike, which is a fixed-rate advance that requires the member to repay the advance when the three-month London Interbank Offered Rate reaches or exceeds an agreed-upon level. If the Bank terminates a convertible (putable) advance prior to the stated maturity date the Bank offers replacement funding to the member provided the member is able to satisfy the normal credit and collateral requirements of the Bank for the replacement funding request.

A type of advance with the same basic features as a Convertible Advance, but with the option to terminate on predetermined dates. The Bank’s option to exercise this termination feature is tied to the rate level on a specific index.

The public voice of the Federal Home Loan Bank System with a primary function to represent the positions and views of the Council’s members to Washington policymakers.

Fee paid to Participating Financial Institutions (PFI) for sharing in the credit risk of the Bank’s Mortgage Product Finance (MPF®) program. Can take several forms: loan loss reserve, loan guarantee, loan loss insurance, debt services reserves, or subordinated/senior capital structure.

An amount calculated to be the equivalent of a rating agency “AA” level credit subordination requirement. It is a contingent liability that results from the sale of mortgage loans to the Bank.

A fee payable monthly by an MPF® bank to a Participating Financial Institution (PFI) in consideration of the PFI’s obligation to fund the realized loss for a master commitment, subject to the terms and fee rate applicable to such master commitment and MPF mortgage product which may include performance and risk participation features.

A contingent liability for PFIs resulting from selling mortgage loans to the Bank.

An FHLB Des Moines team identifying the credit, collateral and legal processes utilized by the Bank to ensure lending to counterparties is performed in a safe, sound and prudent manner.

An approach to manage a company’s interaction with current and potential customers using data analysis about customer’s history to improve relationships and drive sales growth.

Policy structure of computer security guidance used to assess and improve ability to prevent, detect and respond to cyber-attacks.

Strategy to prevent data breaches and exfiltration transmissions by ensuring users don’t send critical or sensitive information. There is also software to monitor, detect and block such losses.

Processing and approval of loans is delegated to DUS lenders who take a portion of the risk for individual multifamily loans.

A type of Advances, Pledge and Security Agreement whereby the member grants the Bank a security interest only in specifically identified collateral categories to secure indebtedness to the Bank. Under the Delivery Pledge Agreement, the member must deliver all collateral pledged to the Bank.

A newly chartered institution which has not filed at least four call reports or thrift financial reports or other similar regulatory reports.

A federal agency, founded in 1965, which is responsible for stimulating housing development in the United States. 

Process of rebuilding a community in the event of a disaster such as a flood or tornado.

A reimbursement program managed by the Bank’s Community Investment Department that assists eligible homebuyers with down payment and closing costs. Downpayment programs include Home$tart® and the Native American Homeownership Initiative (NAHI).

A private, secure, “members-only” website that allows members and eligible housing associates to conduct business and access their FHLB Des Moines accounts using the internet.

A law authorizing the federal government to spend up to $700 billion to purchase and insure certain types of troubled assets for the purposes of providing stability to and preventing disruption in the economy and financial system and protecting taxpayers.

The methods and processes used by organizations to manage risks and seize opportunities related to the achievement of their objectives. ERM provides a framework for risk management, which typically involves identifying particular events or circumstances relevant to the organization’s objectives (risks and opportunities), assessing them in terms of likelihood and magnitude of impact, determining a response strategy and monitoring progress.

The amount or shares of each subclass of the Bank’s Capital Stock held by a member which exceeds that member’s Minimum Investment.

Fannie Mae is a government-sponsored enterprise and a federally chartered corporation that purchases qualifying mortgages from lenders and sells securities backed by mortgage loans to investors.

An agency within the United States Department of Agriculture which guarantees loans made by conventional agriculture lenders.

A federal agency established in 1933 that guarantees (within limits) funds on deposit in member banks and thrift institutions and performs other regulatory and supervisory functions.

Funds deposited by commercial banks at district Federal Reserve Banks, including funds in excess of bank reserve requirements. Banks may lend federal funds to each other on an overnight basis at the federal funds rate.

Privately capitalized, cooperative government-sponsored enterprises created by Congress to support housing and community development. There are 11 regional Federal Home Loan Banks in the United States located in Atlanta, Boston, Chicago, Cincinnati, Dallas, Des Moines, Indianapolis, New York, Pittsburgh, San Francisco and Topeka.

A wholesale bank that provides low-cost short and longterm funding and community lending to over 1,350 stockholder commercial banks, thrifts, credit unions and insurance companies. The Bank is wholly owned by its members and receives no taxpayer funding. FHLB Des Moines serves 13 states and three U.S. Pacific territories and is one of 11 regional Banks that make up the Federal Home Loan Bank System.

A wholly-owned, government corporation established under the National Housing Act of 1934 to improve housing standards and conditions, provide an adequate home financing system through insurance of mortgages and stabilize the mortgage market. FHA was consolidated into the newly established Department of Housing and Urban Development in 1965.

An agency of the United States Government that has regulatory authority and supervisory oversight responsibility for the 11 Federal Home Loan Banks, Fannie Mae and Freddie Mac.

The guaranteed portion of first mortgage loans on residential real estate insured by the FHA or VA.

A private, not-for-profit organization whose primary purpose is to develop Generally Accepted Accounting Principles within the United States in the public’s interest. The Securities and Exchange Commission designated FASB as the organization responsible for setting accounting standards for public companies in the United States.

A United States federal law enacted in the wake of the savings and loan crisis of the 1980s. It established the Resolution Trust Corporation to close hundreds of insolvent thrifts and provided funds to pay out insurance to their depositors. It moved thrift regulatory authority from the Federal Home Loan Bank Board to the Office of Thrift Supervision (within the United States Department of the Treasury) to regulate thrifts.

Sweeping legislation that reshaped the financial services industry and impacted the FHLBank System and its members with respect to membership requirements, capital structure of the FHLBank System and the types of collateral that FHLBanks could accept to secure advances.

An agency established by Congress in 1987 to issue bonds associated with the resolution of troubled financial institutions.

One of the most commonly used rating agencies in the country. Fixed-Rate Advance (Bullet) – An advance with a rate that remains fixed for either the entire term or part of the term.

FSFR Advances are non-amartizing advances that settle at a future date allowing the borrower to delay taking down funding for future anticipated needs while locking in funding costs today.

Freddie Mac is a government- sponsored enterprise, congressionally chartered institution that buys mortgages from lenders and resells them as securities on the secondary mortgage market.

Conventions, rules and procedures that define accepted accounting practice, including broad guidelines as well as detailed procedures. The basic doctrine was set forth by the Accounting Principles Board of the American Institute of Certified Public Accountants, which was superseded in 1973 by the Financial Accounting Standards Board, an independent self-regulatory organization

A federal government-sponsored enterprise that issues securities backed by a pool of mortgages, guaranteed by Ginnie Mae, which passes through to investors the principal and interest payments of homeowners.

Software used by the Bank to track operational risks.

An enterprise created by Congress to fulfill a specific public purpose. In exchange for carrying out its public purposes, a GSE is accorded various privileges and responsibilities that are not available to other private corporations. There are three housing GSEs: Fannie Mae, Freddie Mac, and the FHLBanks.

FHLB Des Moines office located in Des Moines, Iowa.

Home equity lines of credit secured by 1 – 4 family properties.

Loans which back the home equity conversion mortgage backed securities.

Allows those 62 and older to convert equity in their home to cash based on age and home value.

The “set-aside” component of the AHP. The program provides grants for down payment and closing costs to qualifying home buyers earning up to 80 percent of their area Median income. Home$tart® provides $3 for every $1 of a family’s demonstrated funds, up to $7,500.

A chartered institution or State Housing Finance Agency that has been approved as a housing associate that may obtain advances from the Bank if certain requirements are met.

This legislation established a new and independent regulator, the Federal Housing Finance Agency, for the three housing government sponsored enterprises – Fannie Mae, Freddie Mac and the Federal Home Loan Banks. The Act also increased the size of Community Financial Institutions to $1 billion and allowed the FHLBanks to issue standby letters of credit, through members, on a wide range of tax-exempt bonds, among other changes.

Advances, standby letters of credit and a member’s credit enhancement exposure obligations.

Loan assessed as a single unit to determine estimate of amount that can be realized or recovered.

The fee charged for using another’s money or credit. It is expressed as a percentage rate over a period of time. Also, a share or title in property.

A contractual agreement between parties to exchange interest payments over a specific period of time.

Level of credit rating for stocks regarded as carrying a minimal risk to investors.

Evidence-based documents that summarize current information on techniques and management issues in relation to issuance.

Measures which assist in monitoring the level of risk and serve as an early warning signal that risk exposure may be changing. Used to show when risk exposures shift.

A direct-pay letter of credit is a payment mechanism whereby the issuer undertakes to pay the beneficiary by immediately accepting and honoring the draft, so long as the requirements of the draft document have been met and the issuer has no other reason to question the transaction.

An advance with a rate that remains fixed for either the entire term or part of the term.

A form of guarantee of payment issued by a bank on behalf of a borrower.

A daily reference rate based on the interest rates at which banks borrow unsecured funds from other banks in the London wholesale money market (or interbank market).

A type of advance indexed to the one or three-month LIBOR.

Regulator imposed limitations on the extension of credit by a member to an entity or related entities based on the member’s capital.

Discounts applied to the current eligible value of collateral when determining the Advance Equivalent amount which is the maximum collateral value that assets pledged to FHLB Des Moines receive.

An advance used to supplement retail deposits and manage risk. Maturities are from one year to 20 years.

Total dollar amount of company’s equity calculated by multiplying total outstanding shares by current stock price.

An agreement, including any addenda or attachments thereto, executed by a Participating Financial Institution (PFI) and a Mortgage Partnership Finance (MPF®) Bank in accordance with the MPF guides which provides the terms under which the PFI will sell and deliver mortgages to the MPF Bank.

The agreement setting the parameters whereby members can transact business with the Bank.

Notices that need to be seen and acted upon.

For a bond, the date on which the principal is required to be repaid. In an interest rate swap, the date that the swap stops accruing interest.

Any institution that has been approved for membership in the Bank and has purchased Capital Stock

An FHLB Des Moines team handling general member inquiries, account transactions, safekeeping and custody services, wire transfer services, capital stock redemption and dividends and membership applications.

The evaluation utilized by the Bank to determine whether the collateral held by a borrower and pledged as security is in compliance with Federal Housing Finance Agency Regulations, the Advances, Pledge and Security Agreement, and current Collateral Procedures.

Member Mortgage Assets generally are 1 – 4 family mortgage loans, multifamily mortgage loans and mortgage backed securities excluding collateralized mortgage obligations and Real Estate Mortgage Investment Conduits.

A type of advance whereby the borrower has the option to return the funds to the Bank without a prepayment fee at designated prepayment or early termination dates and every six months thereafter.

A type of advance whereby the borrower may choose a one- or three-month advance rate for a fixed term with the flexibility to prepay the advance without incurring a prepayment fee at rate-reset dates.

Addresses the Bank’s management of products offered to members and housing associates, including but not limited to advances, standby letters of credit and the Mortgage Partnership Finance Program.

A subclass of Capital Stock that a member is required to purchase and hold as a condition of membership in the Bank.

The amount of Membership Stock necessary for a member to satisfy its Membership Stock Requirement and the amount of Activity Based Stock necessary for a member to satisfy its Activity Based Stock Requirement.

An FHLB Des Moines team managing models – quantitative methods, systems or approaches that apply to statistical, economic, financial or mathematical theories, techniques and assumptions to process input data into quantitative estimates – particularly in vendor- or user-developed applications.

A type of fund which seeks to limit exposure to losses due to credit, market and liquidity risks. The securities eligible for money market funds include United States governmental bonds, treasury bills and commercial paper from banks and companies.

One of the most commonly used rating agencies in the country.

The transfer of an interest in real property to a lender as a security for a debt, usually a loan of money. While a mortgage in itself is not a debt, it is the lender’s security for a debt.

Securities backed by mortgages.

A fixed-rate, amortizing advance that allows the borrower to make predetermined principal payments at scheduled intervals throughout the term of the loan.

A mortgage purchase program established by the Federal Home Loan Bank of Chicago to provide a competitive secondary market alternative for members of participating Federal Home Loan Banks. Mortgage Partnership Finance and MPF are registered trademarks of the Federal Home Loan Bank of Chicago.

A group of mortgages with similar class, interest rate and maturity characteristics.

An FHLB Des Moines team handling mortgage products available to Bank members, including the Mortgage Partnership Finance Program (MPF®).

Method that uses at least two independent identity indicators to verify a user’s identity for security purposes.

First mortgage loans on multi-family residential real estate.

Industry recognized credible rating agencies for distinguishing among grades of creditworthiness in various regulations under the federal securities laws.

Non-regulatory federal agency promoting U.S. innovations and industrial competitiveness through advancing measurement science, standards and technology to improve economic security and quality of life.

The difference between interest income generated by financial institutions and the amount of interest paid out to their lenders relative to the amount of assets.

An annual grant program to provide funding to members to help eligible households purchase single family owner-occupied properties in Native American Service Areas.

Securities backed by a pool of mortgages that are issued by entities other than government-sponsored enterprises or government agencies.

Loan where borrower is not making interest payments or paying any principle.

Private Minneapolis-based foundation dedicated to expanding economic opportunity for rural peoples in eight states. Partners with FHLB Des Moines to support Native American-led strategies to strengthen economic opportunities for Native people.

Any written request by a member to the Bank to redeem Capital Stock.

Written notice by a member to the Bank of that member’s intention to withdraw from membership in the Bank.

The Office of Finance is the Federal Home Loan Bank’s debt issuance facility. In addition to issuing and servicing all of the debt, the OF administers two government assessment programs which collect assessments from the FHLBanks and funnel them into the Resolution Funding Corporation (REFCORP) and the Financing Corporation (FICO).

Administers and enforces economic and trade sanctions based on US foreign policy and national security goals.

Promotes diversity and ensures inclusion of minorities and women in all business and activities of FHFA.

United States government agency responsible for chartering, examining, supervising and liquidating all national banks.

Agency of the United States Treasury Department created by the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA.) The OTS replaced the Home Loan Bank Board and assumed responsibility for the nation’s savings and loan industry.

Yield spread to be added to a benchmark yield curve to discount a security’s payments to match its market price using a dynamic pricing model that accounts for embedded options.

Manages aspects of the compliance framework and its various processes with input from the Compliance Officer.

When market value of an investment is less than its book value or carrying value, it may be impaired. Impairment can be considered a temporary impairment or other than temporary impairment. The investment is deemed an OTTI when full recovery cannot be reasonably expected in its allotted timeframe and its book value should be written down. The allotted timeframe will depend on the intent of the investment (example: sell the security immediately or hold to maturity).

An eligible member or housing associate participating in the MPF® Program.

Index that tracks levels of prices and rates of inflation. The two most common price indexes published by the government are the Consumer Price Index and the Producer Price Index.

The basic element of the loan as distinguished from interest and mortgage insurance premium. Principal is the amount upon which interest is paid.

Mortgage backed security (MBS) that does not conform to criteria set by the Government Sponsored Enterprises Freddie Mac, Fannie Mae and Ginnie Mae. They do not have backing of the government.

An investment the Bank is authorized to invest in under its Financial Management Policy as selected by the Bank in its sole discretion.

Name of the Bank’s market risk software which aims to increase clients’ risk-adjusted returns.

A pass through vehicle created under the Tax Reform Act of 1986 to issue multi-class mortgage-backed securities.

The duration and service level to which a business must be restored after a disaster in order to avoid issues due to breaks in continuity.

Paid-in capital stock, as defined in the Bank’s Capital Plan, including mandatorily redeemable capital stock classified as a liability under Statement of Financial Accounting Standard 150 plus retained earnings.

Includes any of the following:

1. Loans secured by residential real property;

2. Mortgage-backed securities;

3. Participations in loans secured by residential real property;

4. Loans or investments qualifying under the definition of “community lending” in 12 C.F.R. §900.1;

5. Loans secured by manufactured housing, regardless of whether such housing qualifies as residential real property; or

6. Any loans or investments which the Bank, in its discretion, otherwise determines to be residential housing finance assets.

Residential mortgages loans and securities backed by residential mortgage loans pledged to the Bank as collateral.

United States government agency created in 1989 to issue bailout bonds and raise industry funds to finance activities of the Resolution Trust Corporation and merge or close sick institutions inherited from the disbanded Federal Savings and Loan Insurance Corporation.

Defines the amount of risk the Board of the Bank is willing to assume in pursuit of achieving the Bank’s Strategic Business Plan.

Possibility of reduction in loan portfolio as loans are paid off and new loans do not fill the gap or are contracted at lower interest rates.

United States federal legislation passed in response to a number of major corporate and accounting scandals. The legislation is wide ranging and establishes new or enhanced disclosure standards for all United States public company boards, management and public accounting firms.

Second mortgage loans on 1 – 4 family residential real estate.

The aftermarket or the status for trades after an initial public offering. In real estate, a market for the purpose of purchase and sale of existing mortgages, usually at discounted prices to provide greater liquidity to the mortgagee/lender.

Measure of the cost of borrowing cash on an overnight basis in the US Treasury repo markets. Originally known as the Broad Treasuries financing rate. Successor to LIBOR.

Oversees the key participants in the securities world, including securities exchanges, securities brokers and dealers, investment advisors, and mutual funds. Concerned primarily with promoting the disclosure of important market-related information, maintaining fair dealing and protecting against fraud.

8-K – In addition to filing annual reports on Form 10-K and quarterly reports on Form 10-Q, public companies must report material corporate events on a more current basis. Form 8-K is the “current report” companies must file with the SEC to announce major events that shareholders should know about.

10-Q – The Form 10-Q includes unaudited financial statements and provides a continuing view of the company’s financial position during the year. The report must be filed for each of the first three fiscal quarters of the company’s fiscal year.

10-K – The annual report on Form 10-K provides a comprehensive overview of the company’s business and financial condition and includes audited financial statements. Although similarly named, the annual report on Form 10-K is distinct from the “annual report to shareholders,” which a company must send to its shareholders when it holds an annual meeting to elect directors.

An instrument representing ownership of stocks, bonds and other investments.

Combine security information management and security event management to provide a real-time analysis of security alerts from applications and network hardware.

Internally reported deviation from standard business processes or procedures or a business process or control failure which can cause a risk event. Two types of SIEs: those which can impact the Bank and those which may result in a continuous improvement opportunity.

An advance used to supplement retail deposits and manage risk. Member receives same-day funding with terms less than six months.

Weaknesses in internal controls in financial reporting that is less severe than a material control weakness but sufficient enough to merit scrutiny of responsible administrators.

Home is a stand-alone structure with own lot intended for one family. The most common type of home listed in the Mortgage Loan Service.

A federal agency that provides financial assistance and management assistance to businesses that lack the access to capital markets enjoyed by larger entities.

A type of Advances, Pledge and Security Agreement whereby the member grants the Bank a security interest only in specifically identified collateral categories to secure indebtedness to the Bank. Members under the specific agreement are limited to certain types of collateral and are required to periodically provide detailed listings of all loans pledged.

Standard and Poor’s is one of the most commonly used rating agencies in the country.

A contingent liquidity facility provided to district housing associates to support the issuance of tax-exempt floating rate securities (Variable Rate Demand Obligations) issued to support affordable housing. The agreement obligates the Bank to purchase Variable Rate Demand Obligations that cannot be remarketed in a timely fashion.

An undertaking by the Bank on behalf of a member or housing associate that represents an obligation to the beneficiary (1) to repay money borrowed by or advanced to or for the account of the member or housing associate or (2) to make payment on account of any indebtedness undertaken by the member or housing associate, or (3) to make payment on account of any default by the member or housing associate in the performance of an obligation. It does not include a commercial letter of credit or any short-term selfliquidating instrument used to finance the movement of goods.

A public agency, authority or publicly sponsored corporation that serves as an instrumentality of any state or political subdivision of the state and functions as a source of residential mortgage loan financing in that state; or a legally established agency, authority, corporation or organization that serves as an instrumentality of any Indian tribe, band, group, nation, community or Alaska Native village recognized by the United States or any state and functions as a source of residential mortgage loan financing for the Indian or Alaska Native community.

Sallie Mae is a publicly traded stock corporation that guarantees student loans traded in the secondary market.

A feature that allows you to prepay an advance and potentially realize a gain if interest rates rise to a level greater than those that existed when the advance was originated.

Process for all system development work, including software and system configuration, software development and any other system changes.

1. Capital, calculated according to generally accepted accounting principles less “intangible assets” except for purchased mortgage servicing rights to the extent such assets are included in a member’s core or Tier 1 capital, as reported in the member’s Thrift Financial Report for members whose primary federal regulator is the Office of Thrift Supervision, or as reported in the Report of Condition and Income for members whose primary federal regulator is the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency or the Board of Governors of the Federal Reserve System.

2. Capital calculated according to generally accepted accounting principles, less intangible assets, as defined by the Bank for members that are not regulated by the Office of Thrift Supervision, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, or the Board of Governors of the Federal Reserve System provided that the Bank shall include a member’s purchased mortgage servicing rights to the extent such assets are included for the purpose of meeting regulatory capital requirements.

Goal for accumulated income from the prior year including the current year’s income minus dividends paid to shareholders.

A program created by the United States Federal Reserve Bank in 2008. The facility supports the issuance of assetbacked securities collateralized by student loans, auto loans, credit card loans and loans guaranteed by the Small Business Administration. Under TALF, the Federal Reserve Bank of New York will lend up to $1 trillion (originally $200 billion) on a nonrecourse basis to holders of certain AAA-rated asset-backed securities backed by newly and recently originated consumer and small business loans.

A program adopted by the Federal Deposit Insurance Corporation in 2008 to encourage liquidity in the interbank lending market. The program was designed to decrease the cost of bank funding so that bank lending to consumers and businesses will normalize and to also strengthen confidence and encourage liquidity in the banking system by guaranteeing newly issued senior unsecured debt of banks, thrifts, and certain companies, and by providing full coverage of noninterest bearing deposit transaction accounts, regardless of dollar amount.

Thomson Financial Bankwatch is the world’s largest bank rating agency, providing research and analysis on financial institutions in more than 95 countries. Thomson Financial Bankwatch also provides ratings and research on asset-backed securities.

A deposit account with a fixed or variable interest rate and a stated maturity date.

A member’s total assets as reported to the member’s primary regulator or on its audited financial statement.

A member’s or housing associate’s advances, standby letters of credit, credit enhancement obligations and other extensions of credit from the Bank.

Debt obligations of the U.S. Treasury that have maturities for 10 years or more.

A program of the United States government to purchase assets and equity from financial institutions in order to strengthen its financial sector. It is the largest component of the government’s measures in 2008 to address the subprime mortgage crisis.

Single-class securities backed by mortgage loan with no blending of collateral.

A department of the United States government created to assist America’s farmers and ranchers. Within the department is an agency called the Farm Service Agency, which guarantees loans made by conventional agricultural lenders.

Portion of loan that hasn’t been sent to the lender.

The guaranteed portion of loans on real estate insured by the USDA or SBA. U.S. Treasury Securities – Direct obligations of the United States Treasury, including bills, notes and bonds.

A department of the United States government created to administer the laws providing benefits and other services to veterans and their dependents and the beneficiaries of veterans. This department guarantees loans made by conventional lenders.