Products and Solutions Guide - Federal Home Loan Bank of Boston

IntroductionBuilding Communities –Building New EnglandThe mission of the Federal Home LoanBank of Boston is to provide highly reliablewholesale funding and liquidity to itsmember financial institutions in NewEngland. We deliver competitively pricedfinancial products, services, and expertisethat support housing finance, communitydevelopment, and economic growth,including programs targeted to lowerincomehouseholds.Chartered in 1932, the Federal Home Loan Bank ofBoston is one of 12 Federal Home Loan Banks acrossthe country. The Bank is a cooperative that serves the sixNew England states. Our members are our shareholdersand our customers and we are committed to providingmembers with financial products and services that helpbuild vibrant communities within established risk managementparameters.The Bank provides highly reliable wholesale funding andliquidity to our member financial institutions. We delivercompetitively priced financial products, services, andexpertise that support housing finance and communityeconomic growth, including programs targeted to lowerincomehouseholds.The Products and Solutions Guide is designed to helpmembers understand and use our products, solutions,services, and pricing. It also provides information aboutthe Bank’s credit and collateral policies, and the MortgagePartnership Finance ® (MPF ® ) program, as well as therequirements for accessing those products and servicesin a safe and sound manner.About the GuideThe Bank’s board of directors established the Productsand Solutions Guide and reviews and re-adopts it at leastannually.Please note that the Products and Solutions Guide is alsothe Bank’s Credit Policy and the Bank’s Products Policy. 1Accordingly, any reference in any agreement or otherdocument to the Bank’s Credit Policy or the Bank’s ProductsPolicy means the Products and Solutions Guide. The Bankmay change the guide’s terms at any time without priornotice.The Products and Solutions Guide is available on the Bank’sweb site.Each section of this guide includes contact information todirect members to the appropriate personnel at the Bank.A full listing of Bank contacts may also be found at the endof this guide.Please note: Housing associates are governed by aseparate Products and Solutions Guide, which is availablefrom the Collateral Department (617-292-9729 or collateral@fhlbboston.com)upon request.In the event of any conflict between the terms of thisProducts and Solutions Guide and any prior versions ofthe Bank’s Credit Policy or the Bank’s Products Policy,this Products and Solution Guide shall control.1 The Products and Solutions Guide serves as theBank's Products Policy in accordance with 12 CFRPart 917.4.introductionMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 1

Products and Solutions OverviewCredit ProductsThe Bank offers short-, medium-, and long-term loans knownas advances. These advances offer fixed or variable ratesand several choices for payment of principal and interest.The Bank also offers forward commitments to take downadvances. Some advances contain embedded options,interest-rate caps, or interest-rate floors. The Bank offersdiscounted advances for funding eligible affordable-housingand community-development initiatives. In addition toadvances, the Bank offers noncash credit products such asletters of credit.We want our members to have the tools and informationnecessary to select the best financial solutions. In additionto your relationship manager, the Bank’s financial strategistsare available to produce an analysis that can help guideyou to ultimately select the funding solution that meets yourspecific needs. Our strategists may be reached at 1-800-357-3452 or via e-mail at strategies@fhlbboston.com.Please note that the Bank does not act as a financialadviser, and members should independently evaluatethe suitability and risks of our solutions. Please fully assessthese risks and their implications prior to obtaining productsfrom the Bank. We strive to make all maturities availableevery business day, subject to market conditions.For more information about our credit products, please callyour relationship manager at 1-888-424-3863, the MoneyDesk at 1-800-357-3452, or consult the Bank’s web site,www.fhlbboston.com.The product and solution descriptions that appearin the following pages of this guide are meant assummaries only and do not purport to disclose all risksand other material terms and conditions associatedwith such products and solutions. Nothing in this guideshall be deemed business, legal, tax, or accountingadvice from the Bank. Members are encouraged toconsult their own business, legal, and accountingadvisers with respect to the Bank’s products andsolutions and should refrain from utilizing any of theBank’s products and solutions unless they have fullyassessed the risks and terms.The Bank’s confirmations for advances are availablein Appendix D of this guide. A member should reviewnot only this guide, but also the advance confirmationassociated with any Bank product or solution prior toutilizing such product or solution so as to understandthe terms, including, without limitation, the prepaymentprovisions.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 2

Overnight Funding – Daily Cash Manager AdvanceDaily Cash Manager AdvanceOvernight funding.Common Uses• Manage daily liquidity needs.TermsOne day.DisbursementFunds are available the same day.Principal and Interest• Principal and interest are due at maturity, which is thenext business day.• Interest is calculated on an actual/360-day basis.Additional InformationFor further details, including comments on risks, please seeDaily Cash Manager.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 3

Overnight Funding – Rollover Cash Manager AdvanceRollover Cash Manager AdvanceOvernight funding with an automaticrollover at maturity.Common Uses• Manage daily liquidity needs.TermsMaturity is one day, with an automatic rollover to anew one-day advance at the prevailing rate.DisbursementFunds are available same day or the next-day.Principal and Interest• Principal may be paid on a date you choose.• Payment of interest is due monthly on the secondbusiness day of the month.• Interest is calculated on an actual/360-day basis.Additional InformationFor further details, including comments on risk, please seeRollover Cash Manager Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 4

Overnight Funding – IDEAL Cash Manager AdvanceIDEAL Cash Manager AdvanceOvernight funding using your IDEAL WayLine of Credit.Common Uses• Manage daily liquidity needs.TermsOne day.DisbursementFunds are available the same day and can be accessed bywiring funds from your IDEAL Way demand account, causingan overdraft.Principal and Interest• Principal is due at maturity. Payment of interest is duemonthly on the second business day of the month.• Interest is calculated on an actual/360-day basis.Additional Information• Capital stock deficiencies caused by IDEAL CashManager advances will be automatically satisfied througha capital stock purchase prior to the payoff of the advance.• For further details, including comments on risks, pleasesee IDEAL Cash Manager Advance.The IDEAL Way Line of Credit• The IDEAL Way Line of Credit allows members to accessliquidity quickly and conveniently, without calling theMoney Desk.• It is a fixed amount, typically two percent of assets, andcan easily be set up and/or changed by the member bymaking a request through the Money Desk.• Members are required to maintain collateral equal to theentire amount of the IDEAL Way Line of Credit, whetherused or not.• For more information about the IDEAL Way Line of Credit,please contact the Money Desk at 1-800-357-3452 ormoneydesk@fhlbboston.com.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 5

Fixed-Rate Advances – Amortizing AdvanceAmortizing AdvanceA fixed-term and rate advance with anamortizing principal.Common Uses• Fund short- or long-term assets whoseprincipal balance declines on a monthlybasis due to amortization and/orprepayment.TermsMaturities available for terms out to 20 years with principalamortizationperiods out to 30 years.DisbursementFunds will be available the same day if you call by noonand the following day if requested by 3:00 p.m.Principal and Interest• Principal and interest are due on the first business dayof the month.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please see theAmortizing Advance Confirmation for more information onprepayment fees.Additional InformationFor further details, including comments on risks, please seeAmortizing Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 6

Fixed-Rate Advances – Classic AdvanceClassic AdvanceNonamortizing, fixed-term and rateadvance.Common Uses• Manage liquidity needs.• Manage interest-rate risk.• Fund short- or long-term assets.TermsMaturities available for terms out to 20 years.DisbursementFunds are typically available the same day if you call bynoon. They are available the following day if requested by3:00 p.m.Principal and Interest• Principal is due at maturity and interest is due on thesecond business day of the month.• For advances with maturities of one year or less, youmay choose to pay principal and interest at maturity.If chosen, the advance rate may be higher than theposted rate.• For advances with maturities of more than one year,principal is due at maturity and interest is due eithermonthly, on the second business day of the month, orsemi-annually. If interest is due semi-annually, theadvance rate may be higher than the posted rate.• Interest is calculated on an actual/360-day basis.PrepaymentPlease see the Classic Advance Confirmation for moreinformation on prepayment fees.Additional InformationFor further details, including comments on risks, please seeClassic Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 7

Fixed-Rate Advances – Classic Plus Cap AdvanceClassic Plus Cap AdvanceNonamortizing, fixed-term advance withan interest rate that will adjust periodicallybelow the initial rate if LIBOR exceeds apredetermined strike rate you choose.Common Uses• Limit exposure to rising interest rateswith the added benefit of a reducedinterest rate if rates rise above the capstrike level.• Fund short- or long-term assets.Terms• Maturities are available for terms out to 20 years.• The advance contains an embedded LIBOR-indexedinterest-rate cap, which will reduce the advance ratebelow the initial rate, if LIBOR exceeds a predeterminedstrike rate you choose.• The notional amount of the cap must be at least equalto the amount of the advance and no greater than threetimes the amount of the advance.DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity and interest is due at oneorthree-month intervals, in accordance with the index.• Interest is calculated on an actual/360 basis.PrepaymentAdvances may be prepaid, subject to a fee. Please see theClassic Plus Cap Advance Confirmation for moreinformation on prepayment fees.Additional InformationFor further details, including comments on risks, please seeClassic Plus Cap Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 8

Fixed Rate Advances – Community Development AdvancesCommunity DevelopmentAdvancesDiscounted advances that support affordablehousing and economic developmentinitiatives.Types:CDADiscounted advance that supports a variety of economic development and mixed-use initiatives, including loans for smallbusinesses, social-service or public-facility initiatives, and infrastructure improvements. These advances can also be used tosupport commercial, industrial, and manufacturing initiatives:• Initiatives benefitting households with incomes at or below 115 percent of area median income for a rural initiative, or 100percent of AMI for an urban initiative for a family of four, based on the income guidelines as published annually by HUD.• Initiatives located in a census tract at or below 115 percent of AMI for a rural initiative or 100 percent of AMI for an urbaninitiative.CDA ExtraDeeply discounted advance that supports:• Affordable housing initiatives serving households at or below 115 percent of AMI.• Economic development or mixed-use initiatives serving households at or below 80 percent of AMI.TermsPre-approval is necessary. To apply for a CommunityDevelopment advance, members must submit an onlineapplication.Annual approvals per member are limited to:$35 million for CDA; and$15 million for CDA Extra.DisbursementMembers must take down a Community Developmentadvance within six months of the date of approval, unlessthe application included an approved request for a longertake-down period.Available Products and MaturitiesCommunity Development Advance program advancesare available with maturities of one year and longer. Thefollowing advances are always available as CommunityDevelopment advances: Classic, Member-Option, andAmortizing. Other Community Development advancesmay be available upon request.ReportingThe Bank does not require annual reporting for CommunityDevelopment advances, but it does reserve the right tomonitor compliance with the certifications made in theconfirmation for the advance.Additional InformationFor further details, please see Community DevelopmentAdvances.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 9

Fixed-Rate Advances – Expander AdvanceExpander AdvanceNonamortizing, fixed-term and rateadvance. You have a one-time opportunityto increase the principal amount of theadvance by 100 percent of the originalamount, at the original interest rate, forthe remaining term of the advance.Common Uses• Limit exposure to rising interest rates.• Fund short- or long-term assets.Terms• Maturities are available for terms out to 20 years.• The expansion date may be selected from one to10 years from the original disbursement date.Disbursement• Funds are available two business days after thetrade date.Principal and Interest• Principal is due at maturity and interest is due on thesecond business day of the month.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please see theExpander Advance Confirmation for more information onprepayment fees.Additional InformationFor further details, including comments on risks, please seeExpander Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 10

Fixed-Rate Advances – Forward Starting AdvanceForward Starting AdvanceLock in current fixed rates and delayfunding the advance for up to two years.Classic and Amortizing advances may becustomized to use the forward startingfeature.Common Uses• Access the current rate environmentwithout adding additional liquidity.• Lock in rates for anticipated futurefunding needs.• Allow borrowers to lock in rates onloans with future closing dates.• Manage anticipated deposit runoff oruncertainty in the future.Terms• Maturities available for terms out to 20 years.Disbursement• Funding can be delayed for up to two years.Principal and Interest• Principal and interest are due based on the terms of thespecific advance utilized. Interest begins accruing atdisbursement.• Interest is calculated on an actual/360-day basis.Additional Information• Members will be required to collateralize and purchaseactivity-based capital stock at the time of disbursement.• For further details, including comments on risks, pleasesee the Forward Starting Advance. Please call theMoney Desk at 1-800-357-3452, for indications onspecific structures.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 11

Fixed-Rate Advances – HLB-Option AdvanceHLB-Option AdvanceNonamortizing, fixed-rate and termadvance. The Bank holds the option tocancel the advance on specified datesprior to maturity.Common Uses• Generally used in a flat yield-curveenvironment to obtain a lower cost offunding than a Classic advance with amaturity equal to the lockout period.• Fund short- or long-term assets.Terms• Maturities available for terms out to 20 years, but alwayswith the condition that the Bank may cancel the advanceprior to final maturity.• There is an initial lockout period during which the Bankcannot cancel the advance. You may choose a lockoutperiod of three months to 10 years.• We may cancel the advance only on scheduled cancellationdates, after the initial lockout period. The Bankmakes no warranties as to the circumstances underwhich it might cancel an advance.• The Bank will provide notice of cancellation in writing atleast four business days before the cancellation date.• Some HLB-Option advances are offered with only onecancellation date. Others are offered with a series ofcancellation dates at regular intervals, usually quarterly.DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity and interest is due on thesecond business day of the month.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• If the Bank exercises its option to cancel, you must repaythe advance, but you may replace the advance with anew advance. The new advance may be for any structureand term to maturity agreed upon between the memberand the Bank. The rate on the new advance will be that ineffect at the time the new advance is taken.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please see theHLB-Option Advance Confirmation for more informationon prepayment fees.Additional InformationFor further details, including comments on risks please seeHLB-Option Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 12

Fixed-Rate Advances – HLB-Option Plus Cap AdvanceHLB-Option Plus Cap AdvanceNonamortizing, fixed-rate and termadvance. The Bank holds the option tocancel the advance on specified datesprior to maturity. Also, the advance ratemay decrease if LIBOR rises above astrikerate you choose.Common Uses• Generally used in a flat yield-curveenvironment to obtain a lower cost offunding than a Classic advance with amaturity equal to the lockout period.Added benefit of a reduced interest rateif rates rise above the cap strike level.• Fund short- or long-term assets.Terms• Maturities available for terms out to 20 years, but alwayswith the condition that the Bank may cancel the advanceprior to final maturity.• There is an initial lockout period during which the Bankcannot cancel the advance. You may choose a lockoutperiod of three months to 10 years.• The rate adjusts periodically based on an embeddedinterest-rate cap position. The rate cannot go above theoriginal, stated rate.• The notional amount of the embedded cap can be from100 percent to 300 percent of the amount of the advance.It is a factor in determining the amount of the rateadjustment.• We may cancel the advance only on scheduled cancellationdates, after the initial lockout period. The Bankmakes no warranties as to the circumstances underwhich it might cancel an advance.• The Bank will provide notice of cancellation in writing atleast four business days before the cancellation date.DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity and interest is due on thesecond business day of the month.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• If the Bank exercises its option to cancel, you must repaythe advance, but you may replace the advance with anew advance. The new advance may be for any structureand term to maturity agreed upon between you and theBank. The rate on the new advance will be that in effectat the time the new advance is taken.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please see theHLB-Option Plus Cap Advance Confirmation.Additional InformationFor further details, including comments on risks please seeHLB-Option Plus Cap Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 13

Fixed-Rate Advances – Knockout AdvanceKnockout AdvanceNonamortizing, fixed-term and rateadvance. The advance will be cancelledautomatically if LIBOR equals or exceedsa specified strike rate on selected dates,both selected by the member.Common Uses• Generally used in a flat yield-curveenvironment to obtain a lower cost offunding than Classic advances with amaturity equal to the lockout period.• Fund short- or long-term assets.Terms• Maturities available for terms out to 20 years, but alwayswith the condition that the advance will be terminatedprior to final maturity if LIBOR equals or exceeds thespecified strike rate on a specified date.• The Knockout advance is offered with an initial lockoutperiod during which the advance will not be terminated.You may choose a lockout period of three months to10 years. After the initial lockout period, the Bank willautomatically cancel the advance on any specifiedcancellation date if LIBOR equals or exceeds the strikerate, four London business days prior to the scheduledcancellation date.• Some Knockout advances are offered with only onecancellation date. Others are offered with a series ofcancellation dates at regular intervals, usually quarterly.DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity. Interest is due monthly on thesecond business day of the month.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• If the Knockout Advance is cancelled, you must repay theadvance, but you may replace the advance with a newadvance. The new advance may be for any structure andterm to maturity agreed upon between you and the Bank.The rate on the new advance will be that in effect at thetime the new advance is taken.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please see theKnockout Advance Confirmation for more information ofprepayment fees.Additional InformationFor further details, including comments on risks please seeKnockout Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 14

Fixed-Rate Advances – Member-Option AdvanceMember-Option AdvanceNonamortizing, fixed-term and rateadvance. Members have the option tocancel the advance on specified cancellationdates they select.Common Uses• Manage interest-rate risk.• Fund short- or long-term assets.• Manage exposure to prepayment riskof assets.Terms• Maturities are available for terms out to 20 years.• The member must provide notice of cancellation in writingat least four business days before the cancellation date.DisbursementFunds will be available three business days after the tradedate.Principal and Interest• Payment of principal is due at maturity. Interest is duemonthly on the second business day of the month.• Interest is calculated on an actual/360-day basis.Prepayment• Advances may be prepaid in full or in part, on specifiedcancellation dates with no prepayment fee. Typically, thecancellation dates are the first or third anniversary of thedisbursement and semiannually thereafter. (Otherprepayment structures may be available.)• The advance may be prepaid, subject to a fee, on anydate other than a specified cancellation date.Please see the Member-Option Advance Confirmation formore information onprepayment fees.Additional InformationFor further details, including comments on risks, please seeMember-Option Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 15

Fixed-Rate Advances – New England FundNew England FundDiscounted advances that support affordablehousing and economic developmentinitiatives.The New England Fund offers low-cost, fixed-rate advancesfor eligible affordable housing and economic developmentinitiatives that benefit households or neighborhoods withincomes up to 140 percent of the area median familyincome.Member institutions may apply to the NEF for funding insupport of proposed developments, programs, or loans thatmeet the eligibility guidelines specified below. Mortgageloans eligible for the NEF include those originated orpurchased by members.Income GuidelinesWhere mentioned below, “area median income” and AMIrefer to the area median income as defined by the U.S.Department of Housing and Urban Development. You canuse the Federal Financial Institutions Examination Council’sGeocoding System to determine the median-incomepercentage for a particular address.Eligible One- to Four-Family LoansOne- to four-family mortgage loans are eligible if they are:• Made to individual homeowners whose incomes do notexceed 140 percent of the area median income;• Part of a Massachusetts 40B initiative where the loansupports an “affordable” subdivision or condominiumwhere the incomes of at least 25 percent of the individualhomeowners will not exceed 80 percent of the AMI; or• Part of a Massachusetts 40R initiative or Rhode IslandComprehensive Permit initiative where the loan supportsan “affordable” subdivision or condominium where theincomes of at least 20 percent of the individual homeownerswill not exceed 80 percent of the AMI.Residential Multifamily Rental and CooperativeMortgagesMultifamily rental or cooperative projects are eligible if:• The incomes of at least 80 percent of the residents donot exceed 140 percent of the AMI;• The rents for at least 80 percent of the units are affordableto residents whose incomes do not exceed 140percent of the AMI (i.e., affordable rents do not exceed30 percent of 140 percent of the AMI);• Part of a Massachusetts 40B initiative where 25 percentof the units are affordable to residents whose incomesdo not exceed 80 percent of the AMI;• Part of a Massachusetts 40R initiative or Rhode IslandComprehensive Permit initiative where at least 20 percentof the units are affordable to residents whose incomesdo not exceed 80 percent of the AMI; or• The project qualifies for Low Income Housing Tax Credits,whether or not such credits are used.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 16

Fixed-Rate Advances – The New England Fund cont’d.New England FundNonresidential Community EconomicDevelopment LoansNon-residential community economic development projectsor programs are eligible if:• The project is located in a census tract, neighborhood, orother geographic area for which the AMI does not exceed140 percent of the AMI for the larger geographic area(e.g., PMSA or county);• The project primarily serves individuals or householdswith incomes that do not exceed 140 percent of the AMI;or• The project primarily employs individuals from householdswith incomes that do not exceed 140 percent of theAMI. If the employees’ household incomes are unknown,a project is eligible if it primarily employs individualswhose salaries do not exceed 80 percent of the AMI forone-person households.TermsPre-approval is necessary. To apply for the NEF advance,members must submit an online application.DisbursementMembers must take down an NEF advance within 12months of the date of approval, unless the applicationincluded an approved request for a longer take-down period.Available Products and MaturitiesNEF advances are available with maturities out to 20 years.The following advances are available as NEF advances:Classic, Member-Option, and Amortizing.ReportingThe Bank does not require annual reporting for NEFadvances, but it does reserve the right to monitor compliancewith the certifications made in the confirmation for theadvance.Additional InformationFor further details, please see New England Fund.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 17

Fixed-Rate Advances – Symmetrical Prepayment AdvanceSymmetrical PrepaymentAdvanceNonamortizing, fixed-term and rateadvance with a special prepayment featurethat allows you to prepay the advance atits approximate market value. Any gain willbe passed through to the member subjectto certain limitations.Common Uses• Manage liquidity needs.• Manage interest-rate risk.• Fund short- or long-term assets.• In a rising-rate environment, the gainfrom prepayment can be used to offsetthe loss on sale of securities or otherassets.TermsMaturities are available for terms out to 20 years.DisbursementFunds are available next day.Principal and Interest• Payment of principal is due at maturity and interest isdue on the second business day of the month.• Members may choose monthly or semi-annual interestpayments prior to initiation.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms andwill be executed when orders total $10 million.• Interest is calculated on an actual/360-day basis.Prepayment• Advances may be prepaid with two business days noticeto the Bank, in an amount equal to the approximatemarket value of the advance. Any gain will be passedthrough to the member subject to certain limitations.• For further detail on the actual prepayment amountcalculation, please see the Symmetrical PrepaymentAdvance table.Please see the Symmetrical Prepayment AdvanceConfirmation for more information on prepayment fees.Additional InformationFor further details, including comments on risks, please seeSymmetrical Prepayment Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 18

Long-Term Variable-Rate Indexed Advances – Capped Floater AdvanceCapped Floater AdvanceNonamortizing, fixed-term advance withan interest rate that periodically adjustsaccording to changes in LIBOR and iscapped at a strike level you choose.Common Uses• Limit exposure to rising interest rateswhile participating in a declining interestrate environment.• Fund LIBOR-indexed assets containinga lifetime cap.Terms• Maturities available for terms out to 20 years.• Rates adjust monthly or quarterly, depending on theindex you choose. However, the rate is capped at apredetermined strike level.DisbursementFunds are available two business days after the trade date.Principal and Interest• Payment of principal due at maturity. Interest is due onrate-adjustment dates.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please see theCapped Floater Advance Confirmation for more informationon prepayment fees.Additional InformationFor further details, including comments on risks, please seeCapped Floater Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 19

Long-Term Variable-Rate Indexed Advances – Collar AdvanceCollar AdvanceNonamortizing, fixed-term advance with aninterest rate that periodically adjustsaccording to changes in LIBOR. Theadvance contains a combination of aninterest-rate cap and an interest-rate flooryou choose. The interest rate on theadvance floats within the cap and floor.Common Uses• Cost effective alternative to a CappedFloater advance to limit exposure torising interest rates while giving upsome of the benefit of falling interestrates.• Fund LIBOR-indexed assets.Terms• Maturities available for terms out to 20 years.• Adjustable rate with an embedded interest-rate collar.The collar features a combination of an interest-rate capand an interest-rate floor. The cap sets the maximum ratethe member will pay on the advance. The floor offsets aportion of the cost of the cap, but it sets a minimum rateon the advance.DisbursementFunds are available two business days from the trade date.Principal and Interest• Principal due at maturity. Interest is due on rate-adjustmentdates.• Rates adjust monthly or quarterly, depending on the indexyou choose, on indicated reset dates, based on LIBOR.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• Interest is calculated on an actual/360-day basis.PrepaymentThe advance may be prepaid, subject to a fee. Please seethe Collar Advance Confirmation for more information onprepayment fees.Additional InformationFor further details, including comments on risks, pleasesee Collar Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 20

Long-Term Variable-Rate Indexed Advances – Corridor AdvanceCorridor AdvanceNonamortizing, fixed-term advancecontaining two interest-rate caps that youchoose. The advance rate periodicallyadjusts according to changes in LIBOR ifthe index is below cap one; it will be fixedif the index is between caps one and two,and it will periodically adjust when theindex exceeds cap two.Common Uses• Manage exposure to rising interestrates for a short (one- to three-year)time horizon.• Fund adjustable-rate assets and realizea wider margin on the transaction aslong as market rates remain within aninterest-rate corridor.Terms• Maturities available for terms out to 20 years.• Adjustable rate with an embedded interest-rate corridor.The corridor features two interest-rate caps. The highercap offsets the cost of the lower cap, but may cause theadvance to revert back to an adjustable rate.DisbursementFunds are available in two business days after the tradedate.Principal and Interest• Principal is due at maturity. Interest is due on rate-adjustmentdates.• Rates adjust monthly or quarterly, depending on the indexyou choose, on indicated reset dates, based on LIBOR.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please seethe Corridor Advance Confirmation for more informationon prepayment fees.Additional InformationFor further details, including comments on risk, please seeCorridor Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 21

Long-Term Variable-Rate Indexed Advances – Curve Flattener AdvanceCurve Flattener AdvanceA fixed-term, floating-rate advance thatprovides protection from a flattening yieldcurve since the advance rate decreases asthe yield curve flattens. The advance rateperiodically adjusts and is the sum of twocomponents — a fixed component and arate differential component based on therate differential between two points,chosen by the member, on the ConstantMaturity Swap yield curve.Common Uses• Provides protection from a flatteningyield curve since the advance rate willdecline as the reference yield curveflattens.• Manage interest-rate risk.Terms• Maturities available for terms out to 20 years.• Adjustable rate with an advance rate that is the sum oftwo components, a fixed component and a rate differentialcomponent. The fixed component is determined onthe trade date of the advance and remains fixed throughoutthe term of the advance. The advance rate adjustsquarterly based on the rate differential between twopoints on the CMS yield curve. The rate differentialcomponent evaluates the difference between two points,chosen by the member (longer term minus shorter term),on the CMS yield curve. This difference is added to thefixed component to determine the advance rate.• The interest rate can reset at an interest rate less thanzero..DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity. Interest is due on rate-adjustmentdates.• Rate adjusts quarterly based on the rate differentialbetween two points on the CMS yield curve which isadded to the fixed component.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please seethe Curve Flattener Advance Confirmation for moreinformation on prepayment fees.Additional InformationFor further details, including comments on risk, please seeCurve Flattener Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 22

Long-Term Variable-Rate Indexed Advances – Curve Steepener AdvanceCurve Steepener AdvanceA fixed-term, floating-rate advance thatprovides protection from a steepeningyield curve since the advance ratedecreases as the yield curve steepens.The advance rate periodically adjusts andis the difference between two components– a fixed component and a rate differentialcomponent based on the rate differentialbetween two points, chosen by themember, on the Constant Maturity Swapyield curve.Common Uses• Provides protection from a steepeningyield curve since the advance rate willdecline as the reference yield curvesteepens.• Manage interest-rate risk.Terms• Maturities available for terms out to 20 years.• Adjustable rate with an advance rate that is the differencebetween two components, a fixed component and a ratedifferential component. The fixed component is determinedon the trade date of the advance and remains fixedthroughout the term of the advance. The advance rate adjustsquarterly based on the rate differential between twopoints on the CMS yield curve. The rate differentialcomponent evaluates the difference between two points,chosen by the member (longer term minus shorter term),on the CMS yield curve. This difference is subtractedfrom the fixed component to determine the advance rate.• The interest rate can reset at an interest rate less thanzero..DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity. Interest is due on rate-adjustmentdates.• Rate adjusts quarterly based on the rate differentialbetween two points on the CMS yield curve which issubtracted from the fixed component.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please seethe Curve Steepener Advance Confirmation for moreinformation on prepayment fees.Additional InformationFor further details, including comments on risk, please seeCurve Steepener Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 23

Long-Term Variable-Rate Indexed Advances –Discount Note Auction-Floater AdvanceDiscount Note Auction-FloaterAdvanceNonamortizing, fixed-term advance withan interest rate that adjusts periodicallyaccording to changes in the Federal HomeLoan Bank System’s Office of Financediscount note auction rates.Common Uses• Manage liquidity needs.• Fund adjustable-rate assets.• Manage exposure to declining interestrates.• Long-term funding commitment atshort-term interest rates.TermsMaturities are available in terms out to 20 years.DisbursementFunds are available the next day.Principal and Interest• Principal is due at maturity. Interest is due on therate-adjustment date.• Rates reset every four or 13 weeks, depending on theindex you choose, on indicated reset dates, based onthe result of the prior day’s discount-note auction.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms andwill be executed when orders total $10 million.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. There is no feeif paid at reset dates. Please see the Discount NoteAuction-Floater Advance Confirmation for more informationon prepayment fees.Additional InformationFor further details, including comments on risk, please seeDiscount Note Auction-Floater Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 24

Long-Term Variable-Rate Indexed Advances – Flipper AdvanceFlipper AdvanceNonamortizing, floating-to-fixed-rateadvance where the Bank holds the optionto cancel the advance on certain specifieddates after a specified lockout period.During the lockout period, the advancerate will adjust periodically accordingto changes in LIBOR and generally besub-LIBOR (the spread to LIBOR isdetermined by the member). If theadvance is still outstanding after thelockout period, it will flip to a predeterminedfixed rate.Common Uses• Generally used in a flat yield curveenvironment when margins are underpressure. Sub-LIBOR funding for thelockout period is available.• Manage interest-rate risk.Terms• Maturities are available for terms out to 20 years, butalways with the condition that the Bank may cancel theadvance prior to final maturity. There is a lockout periodduring which the Bank cannot cancel the advance. Youmay choose a lockout period of three months to 10 years.• We may cancel the advance at the end of the lockoutperiod. After the lockout period, the Bank may cancel theadvance only on a scheduled cancellation date, if any.The Bank makes no warranties as to the circumstancesunder which we might cancel an advance.• The Bank will provide notice of cancellation in writing atleast four business days before the cancellation date.• Some Flipper advances are offered with only onecancellation date. Others are available with a series ofcancellation dates at regular quarterly or annual intervals.• The interest rate can reset at a rate less than zero.• The Bank holds the option to cancel on certain specifieddates. If the advance is not cancelled at the end of thelockout period, the advance will convert, or flip, into afixed-rate advance. We may cancel the advance on anysubsequent scheduled cancellation date, if any.DisbursementFunds are available two business days after the trade date.Principal and Interest• The principal is due at maturity. Interest is due monthlyon the second business day of the month.• During the lockout period, rates adjust monthly or quarterly,depending on the index you choose, on indicated resetdates, based on LIBOR.• If the Bank exercises its option to cancel, you must repaythe advance, but you may replace it with a new advance.The new advance may be for any structure and term tomaturity agreed upon between you and the Bank. Therate on the new advance will be that in effect at the timethe new advance is taken.• Interest is calculated on an actual/360-day basis.PrepaymentAdvance may be prepaid, subject to a fee. Please see theFlipper Advance Confirmation for more information on prepaymentfees.Additional InformationFor further details, including comments on risks please seeFlipper Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 25

Long-Term Variable-Rate Indexed Advances – Flipper Advance with Guaranteed FlipFlipper Advance withGuaranteed FlipNonamortizing, floating-to-fixed-rateadvance. During the floating-rate period,the advance rate will adjust periodicallyaccording to changes in LIBOR andgenerally be sub-LIBOR (the spread toLIBOR is determined by the member).After the floating-rate period, it will flip to apredetermined fixed rate until maturity.Common Uses• Generally used in a flat yield curveenvironment when margins are underpressure. Sub-LIBOR funding for thefloating-rate period is available.• Manage interest-rate risk.Terms• Maturities are available for terms out to 20 years. Youmay choose a floating-rate period of three months to 10years.• The interest rate can reset at a rate less than zero.• After the floating-rate period, the advance will convert to apredetermined fixed-rate advance until maturity.DisbursementFunds are available two business days after the trade date.Principal and Interest• The principal is due at maturity. Interest is due monthlyon the second business day of the month.• During the floating-rate period, the advance rate adjustsmonthly or quarterly, depending on the index you choose,on indicated reset dates, based on LIBOR.• Interest is calculated on an actual/360-day basis.PrepaymentAdvance may be prepaid, subject to a fee. Please see theFlipper Advance with Guaranteed Flip Confirmation formore information on prepayment fees.Additional InformationFor further details, including comments on risks, please seeFlipper Advance with Guaranteed Flip.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 26

Long-Term Variable-Rate Indexed Advances – LIBOR-Indexed AdvanceLIBOR-Indexed AdvanceNonamortizing, fixed-term advance with aninterest rate that adjusts periodically,according to changes in LIBOR.Common Uses• Manage liquidity needs.• Fund adjustable-rate assets.• Manage exposure to declining interestrates.• Long-term funding commitment atshort-term interest rates.TermsMaturities are available for terms out to 20 years.DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity and interest is due on rateadjustment dates.• Rates adjust monthly, quarterly, or semiannually, dependingon the index you choose, on indicated reset dates.• The minimum offering size is $10 million. Offering sizeorders for less than $10 million will be aggregated withother requests for advances with identical terms and willbe executed when orders total $10 million.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. There is no feeif prepaid at reset dates. Please see the LIBOR-IndexedAdvance Confirmation for more information on prepaymentfees.Additional InformationFor further details, including comments on risks, please seeLIBOR-Indexed Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 27

Long-Term Variable-Rate Indexed Advances – The Slider AdvanceThe Slider AdvanceNonamortizing, fixed-term advance, withan interest rate that adjusts periodically tochanges in LIBOR and an embeddedinterest-rate floor position. For every basispoint LIBOR sets below the strike rate ofthe floor, the advance rate will decline bytwo basis points.Common Uses• Manage exposure to declining shortterminterest rates.• Fund adjustable rate assets.Terms• Maturities available for terms out to 20 years.• The rate of the advance cannot go below zero.DisbursementFunds are available two business days after the trade date.Principal and Interest• Principal is due at maturity. Interest is due on the rateadjustmentdate.• Rates adjust monthly or quarterly, depending on the indexyou choose, on indicated reset dates, based on LIBOR.• Interest is calculated on an actual/360-day basis.PrepaymentAdvances may be prepaid, subject to a fee. Please seeThe Slider Advance Confirmation for more information onprepayment fees.Additional InformationFor further details, including comments on risks, please seeThe Slider Advance.credit productsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 28

Advance RestructuringAdvance RestructuringA solution that extends the maturity andreduces the rate of existing advances.Through this product, members can restructure outstandingadvances for certain eligible product types and blend thecontractual prepayment fee into the rate of a new long-termadvance. There is no cash settlement of the prepayment feesince it is blended into the rate of the new advance. Thisallows members to extend the maturity of their existingadvances at a lower rate on the new advances comparedwith the rate on the original advances — without takingadditional cash or purchasing additional stock.The Bank will also remodify advances that were restructuredmore than 12 months ago.To help you determine whether this product may be beneficialto your institution, please contact your relationshipmanager.For more information, see the Advance RestructuringSolution presentation.Advance restructuringMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 29

Advances PricingAdvances PricingThe Bank prices credit products consistently and withoutdiscrimination to all members applying for advances nomatter the size of the financial institution. We must alsoensure regulatory compliance while making advancesprofitable in order to meet our financial performanceobjectives and provide an adequate return to our membershareholders. We strive to provide a rate that is competitivewith comparable funding alternatives available to members.We are also prohibited by regulation from pricing ouradvances below our marginal cost of matching term andmaturity funds in the marketplace, including embeddedoptions, and the administrative cost associated with makingsuch advances to members. However, we may priceadvances on a differential basis, such as the creditworthinessof members, volume, or other reasonable criteriaapplied consistently to all members.With these regulatory parameters in mind, we price all creditproducts according to market conditions and the followingspecific criteria:• The Bank’s cost of funds;• The Bank’s cost of delivering products (general andadministrative expenses); and• Bank profitability targets and risk/return objectives.The Bank’s Asset-Liability Committee establishes minimumspread requirements relative to its funding costs for allproducts.Please note that pricing for the Daily Cash Manageradvance is primarily based on the federal funds market,which is highly variable and dynamic. As a result, pricingis subject to change more frequently and at irregularintervals compared with other advances products.PAID ProgramWe offer discounts on the Rollover Cash Manager, Classic,Amortizing, and Symmetrical Prepayment advance productswith at least one year to maturity based on the member’spercentage of advances to assets under the Percent ofAssets Incentive Discount (PAID) program. The discountsunder this program are one, two, and three basis points formembers with advances-to-assets ratios of 10 percent, 15percent, and 20 percent, respectively. These discounts applyonly to rates on programs outside the AHP, CDA, and NEFprograms that are not discounted in any other way.Special Advance OfferingsFrom time to time, the Bank offers scheduled and unscheduledspecials on pricing.In order to promote equal access to “special” pricing to allmembers, we offer specials that approximate those offeredfor single large transactions.Our rates are available in real time on our website. Or youmay call your relationship manager at 1-888-424-3863 or themoney desk at 1-800-357-3452, moneydesk@fhlbboston.com for rate information.credit pricingMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 30

Letters of CreditLetters of CreditStandby and confirming.Common Uses• Securing public unit deposits.• Credit support for certain tax-exemptand taxable bonds.• Performance guaranty in lieu ofa construction performance bond.• Collateral for obligations arisingpursuant to an interest-rate swap.• Credit support for other financialobligations.TermsThree months to 10 years.Must be used to:• Facilitate residential housing finance or communitylending.• Assist with asset/liability management.• Provide liquidity or other funding.IssuanceFor securing public-unit deposits, next business day ifapplication is received by noon. Issuances for other usesvary, depending on complexity.Additional InformationFor further information, see Letters of Credit.Letters of CreditMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 31

Letters of Credit Pricing and FeesLetters of Credit Pricing and FeesLegal fees and operational expenses incurred on a letter ofcredit may be passed through to the member as a processingfee.LOC fees are calculated and billed on an actual/360 basis.See the letter of credit pricing schedule.Fees upon draws on a letter of credit made by a beneficiarytake into account all direct and indirect costs in satisfying thedraw. Fees reflect the imputed rate of return that would havebeen earned and the taxes that would have been paid if theBank were a private corporation. They are calculated byapplying a cost-of-capital adjustment factor to the assetsused in satisfying the draw.Fixed-balance letter of credit fees are based on the facevalue of the letter of credit and are the greater of (a) aminimum dollar fee or (b) a fee based on the face value ofthe letter of credit multiplied by a basis points amount perannum determined by the maturity of the letter of credit. Inthe case of a confirming letter of credit supporting a bondtransaction, a one-time processing fee will be added to thefee described previously under (b), and a minimum dollarfee will not apply.Refundable-balance letter of credit fees are calculated in thesame manner as fixed-balance letter of credit fees. However,if during the term of the letter of credit the average dailybalance in the account throughout the term of the LOC isbelow the original face amount of the Refundable BalanceLOC, a portion of the fee is eligible for a refund to themember when the LOC matures (or annually, whicheveroccurs first).Variable-balance letter of credit fees are based on thequarterly average outstanding balance of deposits that arecollateralized by the letter of credit and reported to the Bankby the member multiplied by a basis points amount perannum determined by the maturity of the letter of credit plusa processing fee. Deposit balances must be reported within15 days following the reporting quarter-end. Average depositbalances that exceed the face value of the letter of credit arenot guaranteed by the letter of credit.Members should contact their relationship manager at1-888-424-3863, or the Money Desk at 1-800-357-3452,or moneydesk@fhlbboston.com for information regardingcollateral requirements and pricing for letters of credit.Letters of CreditMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 32

Asset-Purchase ProgramsAsset-Purchase ProgramsThe Bank participates in the Mortgage Partnership Finance®(MPF®) 1 program, which is an attractive alternative to thetraditional secondary market. Through MPF, the Bankpurchases eligible mortgages from participating members.Members originate and service the loans and are paid feesin return for retaining a portion of the credit risk associatedwith the loans. The Bank manages the interest-rate, liquidity,and prepayment risks, as well as a portion of the credit riskof the loans purchased.We also facilitate the sale of loans to Fannie Mae byparticipating members through the MPF Xtra ® program.The MPF program is administered by the Federal HomeLoan Bank of Chicago. As the MPF Provider, FHLB Chicagosets base prices, rates, and fees associated with variousMPF products using observable third-party pricing sourcesas inputs to its proprietary pricing model. The Bank has theability to adjust prices based on various criteria includingvolume, credit risk, or level of interest rates. The MPFProvider publishes updated quotations on its secure eMPF ®web site, www.fhlbmpf.com, during normal business hours.Participating members can execute delivery commitments ofless than $1 million directly via the web site. Larger commitmentsrequire a phone call to the MPF hotline, 1-877-463-6673. This practice ensures the accuracy of the price quote.We do not adjust pricing based on the size of the deliverycommitment or other factors.For more information about our asset purchase programs,please contact the MPF staff or your relationship manager at1-888-424-3863.1 Mortgage Partnership Finance®, MPF®, and MPFXtra®, eMPF®, are registered trademarks of theFederal Home Loan Bank of Chicago.Asset-Purchase programsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 33

Correspondent ServicesCorrespondent ServicesWe also provide a variety of correspondent services for cashmanagement and investment. Cash management servicesinclude IDEAL Way demand deposit accounts, IDEAL Waylines of credit, custodial mortgage accounts, funds transferservices, and Fed settlement services. Our investmentservices include several short- and long-term depositprograms and safekeeping and trading services.For more information about the Bank’s correspondentservices, please contact your relationship manager at1-888-424-3863, or customer service at 1-800-358-9709.Asset-Purchase programsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 34

Underwriting RequirementsUnderwriting RequirementsGeneral RequirementsThe Bank’s decision to extend credit to a member is basedon our analysis of the member’s financial condition and thelevel, value, and quality of the member’s eligible collateral.The Bank is responsible for ensuring that all extensionsof credit comply with applicable statutes, Federal HousingFinance Agency regulations, and the Bank’s guidelines.To protect our cooperative and your investment, the Bankmonitors each member’s financial condition on a continuousbasis to assure that extensions of credit are made in a safeand sound manner. Our primary tools for monitoring includequarterly financial reports, federal and state examinationreports, audited financial reports, publicly available reports,and interviews with senior management during periodicfinancial reviews by the Credit Department.The Bank’s assessment of your financial condition is focusedon key financial and management indices including:• capital adequacy• asset quality and composition• management• earnings• liquidity• interest-rate risk managementThe Bank’s primary measurement for capital adequacy is“tangible equity capital,” which the Bank defines as totalequity capital as reported in accordance with generallyaccepted accounting principles less goodwill and certainother intangible assets. The Bank also considers thefinancial condition of a member’s parent holding companyand/or affiliates when extending credit to a member.The Bank reserves the right to not extend credit to anymember that the Bank determines, in its sole discretion,fails to meet the Bank’s underwriting guidelines.Credit Status CategoriesDepository Institution Members:The Bank assigns each depository institution member to oneof the following three credit status categories based on ourassessment of the member’s overall financial condition andcertain other factors included in this guide:• Category 1: Members that are in generally satisfactoryfinancial condition.• Category 2: Members that show weakening financialtrends in key financial indices and/or regulatory findings.• Category 3: Members with financial weaknesses thatpresent the Bank with an elevated level of concern.At a minimum, members with a ratio of tangible equitycapital to assets of less than 4.50 percent will not be eligiblefor Category 1 status, and members with a tangible capitalratio of less than 3.50 percent will be assigned to Category 3status.Note: All changes to a depository institution member’scategory and/or borrowing status are reviewed and approvedby the Bank’s internal Credit Committee. The Bankwill notify the member of any such changes in writing.Member Status Implications:The assignment of a depository institution member to aparticular credit status category impacts the member’sspecific collateral requirements. Please refer to theserequirements in the Collateral section of this guide.Insurance Company Members:Insurance company members are not placed in the samecredit status categories as depository institutions becausethey are subject to different laws and regulations in theirparticular states.underwriting requirementsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 35

Underwriting Requirements cont’d.Underwriting RequirementsMember Requests for Extensions of CreditMembers may request an extension of credit from the Bankby calling the Money Desk at 1-800-357-3452.Category 3 depository institution members are required tocomplete and submit the Supplement-A to Application forAdvance (Supplement-A) when requesting an extension ofcredit from the Bank.Insurance company members are required to complete andsubmit the appropriate Supplement-A to Application forAdvance, Insurance Company Members (Supplement-A),when requesting an extension of credit from the Bank.Supplement-A, which provides essential underwritinginformation, should be submitted to the Bank at least threebusiness days prior to the expected commitment date ofthe extension of credit. In a situation where there is animmediate need for liquidity and three days prior notice isnot possible, and when the advance is fully secured byeligible collateral delivered to the Bank, we may provide anexpedited disbursement. Please call the Credit Departmentat 617-292-9795 for further discussion.For purposes of the Supplement-A process, the Bankconsiders the transfer of an IDEAL Way advance to anovernight or other regular advance to be a disbursementof new funds because the IDEAL Way line of credit revertsto its original amount when an IDEAL Way advance istransferred.Note: Supplement-A is generally not required for a requestto roll an existing maturing advance into a new advancewith a maturity of six months or less and does not involvethe disbursement of new funds. Please direct any questionsregarding Supplement-A to the Credit Department at617-292-9795.Maturity and/or Other Borrowing RestrictionsThe Bank may impose a maturity and or other borrowingrestrictions on a member if the Bank determines that themember’s financial condition presents the Bank with anelevated level of risk, such as, if a member fails to complywith any of its regulatory capital requirements. Restrictionsmay also apply to a member that is affiliated with a holdingcompany or other affiliated entity that is not in compliancewith its regulatory capital requirements or that is operatingin receivership, conservatorship, bankruptcy, or under thecontrol of the regulatory entity.Statutory RestrictionsFinance Agency regulations prohibit the Bank from extendingnew credit to a member that becomes insolvent on atangible equity capital basis. However, the Bank, in its solediscretion, may renew maturing advances to such a memberinto an overnight Rollover Cash Manager Advance, ormay require prompt repayment of maturing advances. Aninsolvent member also may not maintain an IDEAL Way lineof credit with the Bank. In addition, the Bank may deem amember that is operating under the control of its primaryregulator to be insolvent on a tangible equity capital basis.underwriting requirementsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 36

Underwriting Requirements cont’d.Underwriting RequirementsTotal Extensions of CreditA member’s total extensions of credit may not, at any time,exceed 50 percent of its total assets as determined by theBank. Members must immediately contact the Bank’s CreditDepartment at 617-292-9795 if this situation occurs. TheBank, with the approval of its president, may grant exceptionsto this limitation on a case-by-case basis. The Bankwill consider the following factors in determining whethera member will be allowed to obtain advances in excess of50 percent of assets:• The strategic reason for the higher level of borrowings;• The level and quality of the member’s eligible collateral;• The member’s overall financial condition;• The member’s asset size;• The level and stability of the member’s capital;• Whether the member has support (or risk exposure)within a holding company structure, or from an affiliateor a subsidiary;• The member’s or holding company’s NRSRO rating,if any.The Bank will assign a depository institution member whosetotal advances exceed 50 percent of its assets to eitherCategory 2 or Category 3 status as the Bank deemsappropriate.Material Adverse EventEach member is required to immediately call the CreditDepartment (617-292-9795) to notify the Bank of anymaterial adverse event and then to follow up in writingdetailing the event. A “material adverse event” is one ormore of the following:• The occurrence of any event or series of events with thecumulative effect of adversely impacting the business,operations, properties, assets, or condition (financial orotherwise) of such member or any of its affiliates or itsparent;• The impairment of such member’s ability to perform itsobligations under its advances agreement or otheragreements with the Bank; and• The impairment of the Bank’s ability to enforce its rightsunder the advances agreement or other agreements withsuch member.Additional InformationFor additional information on the Bank’s underwritingrequirements, please contact your relationship manager at1-888-595-8733, or the Credit Department at 617-292-9795.underwriting requirementsMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 37

Collateral RequirementsCollateral RequirementsEach member is required to pledge sufficienteligible collateral to secure advances(both new and outstanding), lines of credit,letters of credit, and other amounts payableto the Bank, as well as to participate in theasset purchase program, and to enter intoderivative transactions.In the true spirit of our cooperative, the Bank’s robustcollateral requirements are in place to protect our members’investment in the Bank and our financial and regulatorypositions. Every member is required to pledge the requiredamount of eligible collateral to secure all extensions of creditfrom the Bank. The following collateral requirements are inplace to help ensure that the Bank remains in compliancewith all statutes and regulations. Please direct any questionsregarding the Bank’s collateral requirements to the CollateralDepartment at 617-292-9729 or collateral@fhlbboston.com.Collateral RequirementsFinance Agency regulations require that all extensions ofcredit from the Bank to members be fully secured by eligiblecollateral at all times. The Finance Agency regulationsalso identify the general types of assets that the Bank mayconsider as eligible collateral. Members are required topledge eligible collateral to use the Banks products andsolutions.Eligible Collateral – Insurance Company Members• Cash on deposit at the Bank that is specifically pledged tothe Bank as collateral• Debt instruments issued or guaranteed by the U.S.government or any of its agencies• MBS issued or guaranteed by the U.S. government orany of its agencies• In addition, under the Other Real Estate Related Category(ORERC), certain commercial mortgage-backedsecurities (CMBS) may be considered by the Bank if suchcollateral:1. has a readily ascertainable value;2. can be reliably discounted to account for liquidationand other risk;3. can be liquidated in due course, if necessary.• In all instances the Bank must be able to perfect itssecurity interest in such collateral.Note: Contact the Collateral Department at 617-292-9729or collateral@fhlbboston.com for additional information regarding the pledging of eligible securities.Eligible Collateral – Depository InstitutionsEligible collateral includes:• Cash on deposit at the Bank that is specifically pledged tothe Bank as collateral• Fully disbursed whole first-mortgage loans on improvedresidential real estate• Debt instruments issued or guaranteed by the U.S.government or any of its agencies• MBS issued or guaranteed by the U.S. government orany of its agencies• Certain private-label MBS representing an interest inwhole first-mortgage loans on improved residential realestate• Small-business, small agri-business, and small-farmloans from member community financial institutions.• In addition, under the Other Real Estate Related Category,other collateral types such as certain home-equityloans, home-equity lines of credit, first-mortgage loans oncommercial real estate, and certain commercial mortgage-backedsecurities may be considered by the Bank ifsuch collateral:1. has a readily ascertainable value;2. can be reliably discounted to account for liquidationand other risk;3. can be liquidated in due course, if necessary.• In all instances the Bank must be able to perfect itssecurity interest in such collateral.See Appendix A for detailed collateral eligibility guidelines.collateralMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 38

Collateral Requirements cont’d.1 A “residential mortgage loan” is a mortgage loansecured by a one-to-four family residential property.For the Bank’s purposes, the definition includesmortgage loans and home equity loans andopen-ended home equity lines of credit, includingthose secured by junior liens.2 The applicable thresholds are noted in Truth inLending - Regulation Z -12 CFR 226.32.Conditions to the Bank’s Acceptance of CollateralIn general, in order for the Bank to accept an asset constitutingeligible collateral, among other things, each of thefollowing conditions must be met:• The asset must be owned by the member free and clearof all other liens or claims, including UCC filings and otherpledge and security agreements.• The asset must not have been in default within the mostrecent 12-month period, except that whole first-mortgageloans on owner-occupied one-to-four family residentialproperty are eligible collateral provided that the borroweris not in arrears by two or more payments.• Mortgages and other loans are considered eligiblecollateral, regardless of delinquency status, to the extentthat the mortgages or loan are insured or guaranteed bythe U.S. government or agency thereof.• The asset must not be classified as substandard,doubtful, or a loss by the member or the member’sregulatory authority, or reported as troubled debt restructuring.• The asset must not be encumbered by private transferfee covenants, including securities backed by suchmortgages, and securities backed by the income streamfrom such covenants ― except for certain allowedtransfer fee covenants (contact the collateral staff if youhave questions).• The asset cannot secure indebtedness — includingmortgages — on which any director, officer, employee,attorney, or agent of the member or of any Federal HomeLoan Bank is personally liable.• The asset must comply with the Subprime and NontraditionalLoan Guidelines as detailed in Appendix C.A residential mortgage loan 1 that is secured by the borrower’sprimary residence — whether pledged individually oras part of a private-label (non-agency) MBS — will not beaccepted as collateral if it meets one or more of the followingcriteria:• The annual interest rate and/or points and fees chargedfor the loan exceed the thresholds of the Home EquityOwnership Protection Act of 1994 (HOEPA); 2• The loan has been identified by a member’s primaryfederal regulator as possessing predatory characteristics;• The loan includes prepaid, single-premium credit insurance;• The loan is subject to state and/or local laws where oneor more of the major credit-rating agencies (Standard &Poor’s, Moody’s Investors Service, and/or Fitch Ratings)will not rate a security (or securities) in which the underlyingcollateral pool contains such a loan;• The loan is defined as a High-Cost Loan, Covered Loan,or Home Loan, generally categorized under one or morefederal, state, or local laws as having certain potentiallypredatory characteristics;• The loan includes penalties in connection with theprepayment of the mortgage beyond the early years ofthe loan; or• The loan requires mandatory arbitration to settle disputes.The Bank reserves the right, in its sole discretion, to refuse to accept certain assets as collateral including, without limitation,assets constituting eligible collateral.collateralMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 39

Collateral Requirements cont’d.Collateral Maintenance LevelCollateral Maintenance LevelThe amount of collateral that a member is required tomaintain with the Bank at all times is referred to as itscollateral maintenance level. Unless otherwise specified inwriting by the Bank to the member, a member’s collateralmaintenance level is the aggregate amount of eligiblecollateral as defined in this guide, and accepted by theBank, that has a valuation equal to the aggregate amountof the Bank’s extensions of credit to the member. Whendetermining that a member has met its collateral maintenancelevel, the Bank applies a collateral valuationdiscount (haircut) to all eligible collateral, based on theBank’s analysis of the risk factors inherent in the collateral.The Bank reserves the right, in its sole discretion, to adjustcollateral discounts applied. The market values for eligiblesecurities will be determined on the basis of market bidpricequotations for the same or comparable securities asdetermined by, or in a manner satisfactory to the Bank.In the event that the value of a member’s eligible collateralacceptable to the Bank becomes insufficient to satisfy themember’s collateral maintenance level, including, withoutlimitation, due to market depreciation, loan amortization orloan payoffs, the member is required to pledge additionaleligible collateral acceptable to the Bank so that the aggregateamount of the member’s eligible collateral acceptableto the Bank is sufficient to satisfy the collateral maintenancelevel.All fees and costs incurred by the Bank in connection with itscollateral requirements may be charged to the member.The specific types of eligible collateral, additional conditionsto the Bank’s acceptance of collateral, and the relatedpercentages of book value, market value, or unpaid principal(as applicable) applied to collateral are discussed in moredetail in Appendix A to this guide.collateralMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 40

Collateral Requirements cont’d.Use of CustodiansIf a member uses an approved thirdpartycustodian to hold eligible collateralotherwise required to be delivered tothe Bank, it must provide the Bank witha first-priority security interest by enteringinto a control agreement with the custodianand the Bank.Collateral Pledging Requirements –Depository InstitutionsThe primary distinction in the Bank’s collateral requirementsfor members in Category 1, Category 2, and Category 3 isthe degree of documentation the member provides the Bank.All securities must be delivered to the Bank or an approvedthird-party custodian 1 regardless of a member’s credit status.With respect to loan collateral, members in Category 1 maygenerally report (on at least a quarterly basis) summarytotals on their Qualified Collateral Reports for owner-occupiedone-to-four family residential mortgage loans. All otherloans must be listed.Conversely, Members in Category 2 and Category 3 mustlist all loans. In addition, members in Category 3 mustdeliver to the Bank (or an approved third-party) all loandocumentation required by the Bank. 2 The chart belowsummarizes the Bank’s requirement.Depository Institutions Category 1 Category 2 Category 3One- to four-family owner-occupiedresidential mortgage loansReport totals List List and DeliverAll other loans List List List and DeliverSecurities Deliver Deliver DeliverAll loan level listings shall be in a format approved by the Bank and delivered to the Bank at least quarterly (or morefrequently as determined by the Bank).1 The Bank reserves the right, at any time, to requiremembers that have delivered securities to anapproved third-party custodian to deliver thesecurities instead to the Bank.2 Delivery of loan collateral may also be required ofmembers, regardless of credit status, if the Bankdetermines that a creditor has filed a UCC financingstatement on all of a member’s assets or asignificant percentage of a member’s collateralpledged to the Bank.collateralMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 41

Collateral Requirements cont’d.Collateral RequirementsMember’s Specific Collateral RecordkeepingRequirements – Depository InstitutionsCategory 1 Members:1. May use, commingle, encumber, or dispose of anyportion of their collateral as long as:a. there has been no event of default under themember’s “Agreement for Advances, CollateralPledge, and Security Agreement;” andb. the remaining eligible collateral accepted by theBank still satisfies the collateral maintenance level.Upon receipt of a member’s request along withconfirmation that the member’s remaining collateralwould still satisfy the collateral maintenance level,the Bank will execute releases to facilitate dispositionsof collateral by the member.2. Agree to permit Bank personnel to conduct periodic onsite reviews to verify collateral pledged.Category 2 Members:1. Are required to segregate and label all loans pledged as“Collateral for the Federal Home Loan Bank of Boston.”2. May not commingle, encumber, or dispose of anycollateral without the express written consent of theBank.3. Agree to permit Bank personnel to conduct periodic onsite reviews to verify listed collateral that is pledged.Category 3 Members:1. Are required to deliver to the Bank or to a Bankapprovedthird party custodian an amount of eligiblecollateral, acceptable to the Bank, sufficient to satisfythe collateral maintenance level along with any requiredassignment of collateral to the Bank.2. May not use, commingle, encumber, or dispose ofcollateral that has been assigned and delivered withoutthe express written consent of the Bank.3. Are required to segregate on site and mark as propertyof the Bank all ancillary documents that pertain tocollateral that has been delivered to the Bank.4. Are required to notify the Bank of the acceptance ofproceeds from the repayment of notes pledged to theBank as collateral. The Bank may require the deliveryof an amount of collateral equal to the proceeds of therepayment of the notes into a collateral account tosecure the member’s indebtedness to the Bank.5. Agree to permit Bank personnel to conduct periodicon-site reviews to verify listed collateral that is pledged.collateralMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 42

Collateral Requirements cont’d.Collateral RequirementsCollateral Pledging Requirements – InsuranceCompany Members1. Are required to deliver to the Bank or to a Bankapprovedthird party custodian an amount of eligiblecollateral, acceptable to the Bank, sufficient to satisfythe collateral maintenance level along with any requiredassignment of collateral to the Bank.2. May not use, commingle, encumber, or dispose ofcollateral that has been assigned and delivered withoutthe express written consent of the Bank.3. Are required to segregate on site and mark as propertyof the Bank all ancillary documents that pertain tocollateral that has been delivered to the Bank.4. Are required to notify the Bank of the acceptance ofproceeds from the repayment of notes pledged to theBank as collateral. The Bank may require the deliveryof an amount of collateral equal to the proceeds of therepayment of the notes into a collateral account tosecure the member’s indebtedness to the Bank.Additional Collateral RequirementsThe Bank reserves the right to take any and all actions toprotect its security position, assure compliance with thisguide and to safeguard members’ investment in the Bankshould the Bank identify potential risks. Such actions mayinclude, but are not limited to, requiring the delivery ofadditional collateral, whether or not such additional collateralwould be deemed eligible collateral pursuant to this guide,and requiring a member to complete further steps in order toperfect the Bank’s security interest in the members’ pledgedcollateral. At the request of the Bank, each member agreesto execute, deliver to the Bank and/or record, as applicable,such instruments, assignments and other documents, andto take other actions necessary or desirable, to evidence,preserve and/or protect the security interest of the Bank inthe collateral.Eligible Assets Held in a Real Estate InvestmentTrust (REIT) and/or a Passive Investment Company(PIC), and/or Security CorporationAssets of a member that have been transferred to a REITand/or PIC, or other separately incorporated subsidiarytypically do not constitute eligible collateral for the Bank’spurposes. However, in certain cases the Bank may allowa member to include such assets in its collateral pledgeprovided that: (i) with respect to a REIT or PIC, the subsidiarypledges assets that constitute eligible collateral onbehalf of the member; and (ii) with respect to a securitycorporation, the member pledges the stock certificate(s)that prove its ownership of the security corporation, and theassets in the security corporation are comprised solely ofeligible collateral as determined by the Bank. All assets ofa security corporation must be held in safekeeping at theBank. (Before pledging these assets as collateral, pleasecontact the Collateral Department).Please direct any questions regarding the Bank’s collateralrequirements to the Collateral Department at 617-292-9729or collateral@fhlbboston.com.collateralMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 43

AppendicesFederal Home Loan Bank of Boston | 800 Boylston Street | 9th floor | Boston, MA 02199 | www.fhlbboston.com

Appendix A – Eligible Collateral and Collateral ValuationEligible Collateral and CollateralValuationThe assets listed below constitute the Bank’s overall eligible collateral types. Please refer to page 38 to see the collateraltypes that may be pledged by member type.The Bank may, in our sole discretion, refuse certain collateral or adjust collateral discounts or valuations based on:• The financial condition of the member• The review of the overall quality and volatility of the value of the collateral pledged. We make this determination basedon the result of on site member collateral reviews and our risk analysis.The Bank will determine market value for all types of collateral at its sole discretion, and may determine to value collateralat the unpaid principal balance. Residential one- to four-family owner-occupied loans must not be delinquent by two or morepayments. All other eligible collateral must not have been in default within the most recent 12-month period.The following tables summarize the valuation that we generally apply for collateral purposes. The five categories of eligiblecollateral are cash, securities, residential first-mortgage loans, community financial institution (CFI) collateral, and other realestate-related collateral.Please contact the Collateral Department at 617-292-9729 or collateral@fhlbboston.com if you have questions regardingeligible collateral.Cash CollateralEligible Collateral Valuation CommentsCash 100 percent of balance Cash must be on deposit in a collateralaccount at the BankSecurities• All members are required to deliver to the Bank or to a Bank-approved third-party custodian all securities pledged ascollateral for the Bank’s extensions of credit.• Members that use a Bank-approved third-party custodian must execute a “control agreement” with the custodian and theBank. All pledged securities must be maintained in a segregated account under the Bank’s exclusive control and havedaily pricing of market values available to the Bank. Note: The Bank may require members that use a third-party custodianto instead deliver these securities to the Bank at any time.• A member that holds securities in a security corporation subsidiary may be allowed by the Bank to deliver as eligiblecollateral the stock certificate(s) that evidence its ownership of the security corporation subsidiary. If allowed, the memberis required to safekeep the underlying securities with the Bank.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 45

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuation• The Bank does not accept as collateral derivatives of eligible securities that contain excessive interest-rate and/or otherfinancial risk, including, but not limited to, interest-only or principal-only strips of securities, or residual or “Z” tranches ofcollateralized mortgage obligations.• The Bank does not accept as collateral securities that are backed by properties encumbered by private transfer fee covenants,and securities backed by the income stream from such covenants ― except for certain allowed transfer fee covenants.• The Market value for securities is determined on the basis of market bid-price quotations for the same or comparable securitiesas determined by, or in a manner satisfactory to, the Bank.Eligible Collateral Valuation CommentsU.S. Government and AgencySecurities, (excluding FNMA andFHLMC mortgage-backedsecurities (MBS)FNMA and FHLMC MBS, andAgency CMOs97 percent of market value (remainingterm to maturity three years or less);95 percent of market value (remainingterm to maturity greater than threeyears93 percent of market valueNon-Agency MBS 50 percent of market value Only depository institution members may pledge thiscollateral.Limited to AAA-rated securities backed by prime loancollateral as determined by the Bank.Borrowing capacity limited to the amount of the member’sGAAP capital.Must represent an unsubordinated interest in whole firstmortgageloans on improved residential property not morethan 90 days delinquent.All underlying mortgage loans must meet the other eligibilityrequirements for residential loans as outlined in this guide.Securities representing an equityinterest in collateral eligible foradvancesValuation is determined in accordancewith the valuation applicable to the underlyingassetsMust represent an undivided equity interest in underlyingassets of a security corporation subsidiary, all of whichqualify as eligible collateral under the guide.Note: Insurance company members and non-depository community development financial institutions that execute a specific lienagreement may only pledge as collateral (i) cash on deposit in a collateral account at the Bank, (ii) securities issued or guaranteed by theU.S. government or an agency thereof, including MBS issued or guaranteed by FNMA or the FHLMC, and (iii) private-label commercialmortgage-backed securities. In each case, such securities must be delivered to the Bank or a third-party custodian. The eligibility criteriafor pledging private-label commercial mortgage-backed securities are as set forth in this guide. Discounts applied to securities collateralare increased by 20 percent. For example, a discount of 10 percent increases to 12 percent.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 46

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationResidential First-Mortgage LoansDefinition of Owner-Occupied Principal Residence: Loans secured by owner-occupied dwellings. An owner-occupied dwellingis the borrower’s primary residence. First lien owner-occupied residential loans are included in this section. (Second liens onowner-occupied residences are included as other real estate-related collateral).Definition of Non-Owner-Occupied Residence: Second homes, vacation homes, or other investor type properties. Theseloans must be listed. First liens on non-owner occupied loans are included in this section. Please note: Second liens on non-owner-occupiedresidences are ineligible as collateral.Other Eligibility Guidelines• Eligible residential first-mortgage loan collateral that becomes subject to a superior lien, including, but not limited to tax liens,mechanics liens, UCC filings or any other encumbrance, loses its eligibility.• Eligible residential first-mortgage loan collateral must not be delinquent by two or more payments.• Eligible residential first-mortgage loan collateral may not be classified as substandard, doubtful, or loss by the member or byits regulator, or reported as troubled debt restructuring.• Eligible residential first-mortgage loan collateral may not include loans to officers, directors, employees, attorneys, or agentsof the member institution or the Bank.• Eligible residential first-mortgage loan collateral must not be encumbered by private transfer fee covenants ― except forcertain allowed transfer fee covenants (contact the collateral staff if you have questions).• Eligible residential first-mortgage loan collateral with loan-to-value (LTV) ratios over 90 percent at the time the loan is originated(with the exception of Loans insured under Title II of the National Housing Act, i.e., insured by the FHA) must have privatemortgage insurance.• Loans must fully comply with either or both, as applicable, the Interagency Guidance on Nontraditional Mortgage ProductRisks issued by the FFIEC on October 4, 2006, and/or the Statement on Subprime Mortgage Lending Risks dated July 10,2007, to be eligible as collateral.• Loans that allow for negative amortization of the principal balance, including pay-option adjustable-rate mortgage loans, andhome equity conversion mortgages (also known as “reverse mortgages”) are not eligible as collateral.• Loans for which the borrower’s ability to service the debt is not evidenced by written documentation may only be pledged ifthe member is providing the Bank with loan level data for all of its pledged residential one- to four-family loan collateral.• Loans that meet the Bank’s definition of both a subprime and nontraditional loan may only be pledged if the member isproviding the Bank with loan level data for all of its pledged residential one- to four-family loan collateral.• Fully disbursed, closed-end home equity loans secured by first liens on one- to four-family family residential real estate areincluded within this section for one- to four-family mortgage loan collateral. However, home equity loans secured by juniorliens, or home equity lines of credit (HELOCs) – whether secured by first liens or junior liens on one- to four-family familyresidential property – are considered other real estate-related collateral for purposes of this guide.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 47

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationOther Eligibility Guidelines (specific to fully disbursed, whole first mortgages secured by residential, owner-occupiedone-to-four family manufactured housing property):In addition to the eligibility requirements for residential first-mortgage loans listed above, to be considered as eligiblecollateral, manufactured housing loans must meet the following additional requirements:• The manufactured housing must be located in a state where applicable state law defines the purchase or holding ofmanufactured housing as the purchase or holding of real property;Please note that the Bank may require that a member that seeks to pledge loans secured by manufactured housing ascollateral deliver to the Bank a legal opinion in form and substance satisfactory to the Bank’s legal department demonstratingthat the forgoing requirement has been satisfied.• Be on land owned by the borrower consistent with existing requirements for one- to four-family site built homes (i.e., theborrower must own the home and the underlying land);• Be permanently affixed or anchored to a foundation, connected to utilities, and any wheels, axles, and trailer hitchesremoved;• The mortgage must include both the land and improvements ― including the manufactured home; and• Loan documentation must include the make, model, and serial identification number on the mortgage and all otherrequirements necessary to perfect a lien on such property.Note: If you plan to pledge eligible manufactured housing one- to four-family residential loans as collateral, pleasecontact the Collateral Department at 617-292-9729 or collateral@fhlbboston.com for specific pledging instructions.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 48

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationEligible Collateral Valuation CommentsFully disbursed whole firstmortgages on owner-occupiedone- to four-family residentialproperty100 percent participation certificatesbacked by this type ofcollateral are the equivalent ofwhole loansFully disbursed whole firstmortgages on owner-occupiedone- to four-family residentialproperty fully insured by the FHAMortgages or other loans, with theexception of SBA and USDA loans,regardless of delinquency status,to the extent that the mortgages orloans are insured or guaranteed bythe U. S. or any agency thereofConventional – up to 80 percent ofunpaid principal balanceNontraditional – up to 75 percent ofunpaid principal balanceSubprime – up to 75 percent ofunpaid principal balanceNote: Nontraditional and subprimemortgage loans are defined inaccordance with Appendix C of thisguide. Eligible mortgage loans thatdo not meet these definitions areconsidered “conventional”90 percent of unpaid principal balancewith a loan level listing85 percent of unpaid principal balancewithout a loan level listingThe maximum valuations are available to Category 1members that choose to provide loan-level data for thesepledged collateral categories. Actual valuation is based onthe Bank’s risk analysis.For Category 1 members that choose not to provideloan-level data for these collateral categories, the maximumvaluations are 75 percent for conventional loans, 65percent for nontraditional loans, and 60 percent forsubprime loans.For Category 2 and Category 3 members, the maximumvaluation is 75 percent for conventional loans, 65 percentfor nontraditional loans, and 60 percent for subprime loans.Actual valuation is based on the Bank’s risk analysis.Borrowing capacity from eligible subprime loans for allmembers is limited to an amount no greater than the lesserof: (i) one-half the member’s total collateral borrowingcapacity; or (ii) two times the member’s most recentlyreported GAAP capital amount.For Category 1 members that provide a loan level listing,the valuation will not exceed 90 percentFor Category 1 members that do not provide a loan levellisting, the valuation will not exceed 85 percent.For Category 2 and Category 3 members, the valuation willnot exceed 90 percent.Collateral valuation for members that list or deliver loans isbased on the Bank’s risk analysis.75 percent of unpaid principal balance Such insurance or guaranty must be for the direct benefit ofthe member pledging the mortgage or loan as collateral.The Bank must be able to perfect its security interest in theinsurance guarantee on such loans.The Bank does not accept loans guaranteed by SBA or theU.S. Department of Agriculture as collateral because theBank is not able to perfect its security interest in theinsurance guarantee of these loans at this time.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 49

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationEligible Collateral Valuation CommentsFully disbursed whole firstmortgages on residential,owner-occupied one- to four-familymanufactured housing propertyConventional – up to 80 percent ofunpaid principal balanceThe maximum valuations are available to Category 1members that choose to provide loan-level data formanufactured housing loan collateral.(Actual valuation is based on the Bank’s risk analysis).For Category 1 members that choose not to provideloan-level data for conventional manufactured housingloans, the maximum valuation is 75 percent.Nontraditional – up to 75 percent ofunpaid principal balanceSubprime – up to 75 percent ofunpaid principal balanceNote: Nontraditional and subprimemortgage loans are defined inaccordance with Appendix C of thisguide. Eligible mortgage loans that donot meet these definitions areconsidered “conventional”Category 1 members may pledge nontraditional andsubprime manufactured housing loans provided theyprovide the Bank with a loan level listing for all pledgednontraditional and subprime one- to four-family loans(site-built and manufactured housing loans).The maximum valuation for this collateral is 75 percent.(Actual valuation is based on the Bank’s risk analysis).For Category 2 and Category 3 members, the maximumvaluation is 75 percent for conventional manufactured housingloans, 65 percent for nontraditional loans, and 60percent for subprime loans.(Actual valuation is based on the Bank’s risk analysis).Borrowing capacity from eligible subprime loans for allmembers is limited to an amount no greater than the lesserof: (i) one-half the member’s total collateral borrowingcapacity; or (ii) two times the member’s most recentlyreported GAAP capital amount.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 50

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationEligible Collateral Valuation CommentsFully disbursed whole firstmortgages on non owner-occupiedone- to four-family residentialpropertyUp to 75 percent of unpaid principalbalanceRequires a specific loan level listing to the Bank; at leastquarterly, or more often as determined by the Bank.Actual collateral valuation for members that list or deliverloans is based on the Bank’s risk analysis.Fully disbursed whole firstmortgages on residential propertyof five or more unitsFully disbursed whole firstmortgages on residential propertyof five or more units insured by theFHAUp to 73 percent of the lower ofmarket value or unpaid principalbalance90 percent of unpaid principal balancewithout a loan level listingRequires review and acceptance by the Bank beforepledging.Actual collateral valuation for members that list or deliverloans is based on the Bank’s risk analysis.Requires a specific loan level listing to the Bank at leastquarterly, or more often as determined by the Bank.Actual collateral valuation for members that list or deliverloans is based on the Bank’s risk analysis.CFI Collateral• Eligible community financial institution collateral (CFI) can only be pledged by members that qualify as a CFI in accordancewith Federal Housing Finance Agency regulations.• A CFI is defined as a member FDIC-insured depository institution with total average assets over the proceeding threeyearperiod of an amount set and adjusted by the FHFA based on changes in the Consumer Price Index.• CFI collateral must be reviewed and accepted by the Bank prior to pledging as eligible collateral. If accepted, as collateral,the member must provide the Bank with a specific loan level listing for accepted loans at least quarterly, and moreoften as determined by the Bank.• CFI collateral must have a readily ascertainable value and the Bank must be able to perfect a security interest in thiscollateral.Eligible Collateral Valuation CommentsSecured small-business, smallagribusiness,and small-farmloans. (Small farm loans are loanssecured primarily by farmland).50 percent of the lower of marketvalue or unpaid principal balanceCFI loans must be within the member’s legal lending limit toone borrower.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 51

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationOther Real Estate-Related Collateral• Other real-estate-related collateral is limited to a discounted amount up to two times the member’s GAAP capital.• Other real estate-related collateral must have a readily ascertainable value, the Bank must be able to perfect a securityinterest in this collateral, and the Bank must be able to sell the property in a reasonable time frame if liquidation ofcollateral is necessary.• Other real estate-related collateral must meet the other eligibility requirements for residential loans as outlined in thisguide.• Other real estate-related collateral must be reviewed and accepted by the Bank prior to pledging as eligible collateral.• If accepted, the member must provide the Bank with a specific loan level listing for accepted loans at least quarterly,and more often as determined by the Bank.Eligible Collateral Valuation CommentsFully disbursed whole first mortgageson commercial real estateFully-disbursed second-lien homeequity loans and first- or second-lienhome equity lines of credit (HELOCs)secured by the borrower’s primaryresidenceUp to 65 percent of the lower of marketvalue or unpaid principal balance asdetermined by the BankActual valuation up to 65 percent is basedon the Bank’s risk analysis50 percent of unpaid principal balance (thebalance drawn by the borrower in the caseof a line of credit)All commercial real estate loans are accepted ascollateral at the Bank’s discretion. In some casesmembers may have commercial real estate loansthat are secured with higher-risk property typessuch as those with potential environmental risks,single- or special-purpose properties, orproperties that have limited improvements. Theseconditions generally impact the ability toaccurately value the properties and can cause anextended marketing period and cost in case ofliquidation. Commercial real estate loans fundedthrough the Bank’s Affordable Housing Programmay be acceptable as collateral provided theloans meet the eligibility requirements describedabove. Please contact the Bank’s CollateralDepartment at 617-292-9729 or collateral@fhlbboston.com for further information.Must be secured by the borrowers’ primaryresidence.The combined loan-to-value ratio(CLTV) of the loan cannot exceed 80 percent. Allother home equity loans and HELOCs are notconsidered eligible collateral. The Bankcalculates CLTV by adding the loan balance, or,in the case of HELOCs, the maximum amount ofthe line of credit, to the first lien loan balance anddividing the total amount by the appraised valueof the residence.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 52

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationEligible Collateral Rating2 Term to Maturity ValuationCommerical Mortgage BackedSecurities 1 AA Five years or greater 65 percent of market valueAAA Less than five years 85 percent of market valueAAA Five years or greater 80 percent of market valueAA Less than five years 75 percent of market valueA 3 Less than five years 65 percent of market valueA 3 Five years or greater 50 percent of market value1. CMBS is eligible under the other real estate related collateral category. All collateral pledged under the ORERC category is limited to adiscounted amount up to two times the member’s GAAP Capital (for Insurance Company members that report under the Statutory AccountingPrinciples, SAP Capital will be used).2. The lowest rating by either Moody’s, S&P, or Fitch will be used to consider eligibility.3. CMBS that is rated only A by either Moody’s, S&P, or Fitch will be limited to a discounted amount of 20 percent of your total pledge of CMBScollateral.Note: Insurance company members and non-depository community development financial institutions that execute a specific lien agreementmay only pledge as collateral (i) cash on deposit in a collateral account at the Bank, (ii) securities issued or guaranteed by the U.S. governmentor an agency thereof, including MBS issued or guaranteed by FNMA or the FHLMC and (iii) private label commercial mortgage backedsecurities. In each case, such securities must be delivered to the Bank or a third-party custodian. The eligibility criteria for pledging privatelabel commercial mortgage backed securities are as set forth in this guide. Discounts applied to securities collateral are increased by 20percent. For example, a discount of 10 percent increases to 12 percent.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 53

Appendix A – Eligible Collateral and Collateral Valuation cont’d.Eligible Collateral and CollateralValuationIn addition to the criteria provided in the table above, the following criteria must also be met for CMBS to be deemed eligiblecollateral:• Domestic CMBS deals only with a maximum threshold of 25 percent for any single loan or single borrower in the pool ofcollateral;• Securities have to be publicly registered and publicly traded;• A daily market price must be available from the Bank’s custodian, Citibank, or an approved third-party custodian, andcash flows must be available for ongoing monitoring/modeling for the Bank to accept the CMBS as collateral;• Minimum of 50 loans in the issue;• Only senior tranches;• All loans securing the bond must be secured by a first mortgage (no junior liens);• Maximum weighted average LTV of 80 percent within the deal; and minimum weighted average DSCR of 1.20X.CMBS with the following characteristics will be deemed ineligible to be pledged as collateral:• Single property, single asset type, or single borrower;• Non-public deals (private placement) or no CUSIP for pricing;• CMBS denominated in currency other than U.S. dollars.• Deals secured by land only loans;• Securities sponsored by the member or any of its affiliates;• Subordinate tranches such as mezzanine and junior tranches (AM, AJ, class etc.);• Securities that represent a share of only the interest payments or the principal payments from the underlying loans; and• Any CMBS that has experienced interest payment shortfalls or that allows for the deferment of interest payments if thereis a shortfall in cash flows (Available Funds Class).The Bank will review each CMBS pledged, and reserves the right to reject collateral for any reason.Appendix AMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 54

Appendix B – Anti-Predatory Lending PolicyAnti-Predatory Lending PolicyAll members must file an anti-predatorylending statement with the Bank as arequirement for borrowing.The Bank supports the expansion of fair and equitable homeownership opportunities. To discourage predatory lendingpractices, which are inconsistent with such opportunities, and to protect the Bank from potential liabilities, the Bank hasestablished the following anti-predatory lending policy (“APL Policy”) with respect to residential mortgage loans and securitiesbacked by residential mortgage loans pledged by members to it as collateral (“Residential Mortgage Collateral”) orpurchased from members (“Acquired Member Assets”).The Bank requires that Residential Mortgage Collateral and Acquired Member Assets comply with applicable federal, state,and local anti-predatory lending laws and other similar credit-related consumer protection laws, regulations and ordersdesigned to prevent or regulate abusive and deceptive lending practices and loan terms (collectively, “Anti-PredatoryLending Laws”). For example, Anti-Predatory Lending Laws may prohibit or limit certain practices and characteristics,including, but not limited to the following:• Requiring the borrower to obtain prepaid, single-premium credit life, credit disability, credit unemployment, or othersimilar credit insurance;• Requiring mandatory arbitration provisions with respect to dispute resolution in the loan documents; or• Charging prepayment penalties for the payoff of the loan beyond the early years of such loan.Any Residential Mortgage Collateral that does not comply with all applicable Anti-Predatory Lending Laws will be ineligibleas collateral to support advances or other activity with the Bank. Additionally, the Bank will not give collateral value for anyresidential mortgage loans on owner-occupied property, whether pledged individually or as part of a private-label (nonagency)MBS, if it meets one or more of the following criteria:• The annual interest rate and/or points and fees charged for the loan exceed the thresholds of the Home EquityOwnership Protection Act of 1994 (HOEPA);.• The loan has been identified by a member’s primary federal regulator as possessing predatory characteristics;• The loan includes prepaid, single-premium credit insurance;• The loan is subject to state and/or local laws where one or more of the major credit-rating agencies (Standard andPoor’s, Moody’s Investors Service, and/or Fitch Ratings) will not rate a security (or securities) in which the underlyingcollateral pool contains such a loan; or• The loan is defined as a High-Cost Loan, Covered Loan, or Home Loan as are loans categorized under one or morefederal, state, or local predatory lending laws as having certain potentially predatory characteristics.• The loan includes penalties in connection with the prepayment of the mortgage beyond the early years of the loan.• The loan requires mandatory arbitration to settle disputes.Appendix BMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 55

Appendix B – Anti-Predatory Lending Policy cont’d.Anti-Predatory Lending PolicyMembers are responsible for avoiding all unlawful practices and terms prohibited by applicable Anti-Predatory LendingLaws, regardless of whether they originate or purchase the Residential Mortgage Collateral being pledged to the Bank.The Bank will take those steps it deems reasonably necessary in order to confirm or monitor members’ compliance with thispolicy. The Bank will adopt procedures to monitor for member compliance with this APL Policy which will:1. Ensure that all members have executed the representation and warranty Certification;2. Ensure that all pledging subsidiaries and affiliates of members have executed the representation and warrantyCertification;3. Review member regulator exam reports for findings pertaining to fair lending and/or abusive lending practices;4. Monitor member regulator alerts for newly issued supervisory agreements, memoranda of understanding, or ceaseand desist orders pertaining to unfair lending and/or abusive lending practices;5. If abusive lending issues are identified by the member’s regulator, or if, Bank staff identifies APL abuses then themember will be required to undertake a review of its policy and procedures for compliance with the Bank’s collateralpolicies. At its discretion, the Bank may permit such a review to be conducted by the member’s internal auditor or theBank may choose to conduct the review itself or use a third party, at the expense of the member.In addition, the Bank reserves the right to require evidence reasonably satisfactory to the Bank that Residential MortgageCollateral does not violate applicable Anti-Predatory Lending Laws. With respect to Residential Mortgage Collateralpurchased by the member, the member is responsible for conducting due diligence that it deems sufficient to support itscertification and indemnification agreements with the Bank. In addition to the terms and conditions of the Bank’s Advancesand Security Agreement (“Advances Agreement”), each member must execute a Certification agreement with the Bank that:(1) certifies its understanding and compliance with the Bank’s APL Policy and all applicable Anti-Predatory Lending Laws;and (2) certifies it will maintain qualifying collateral and will (a) substitute eligible collateral for any Residential MortgageCollateral that does not comply in all material respects with applicable Anti-Predatory Lending Laws or this APL Policy; and(b) indemnify, defend and hold the Bank harmless from and against all losses, damages, claims, actions, causes of action,liabilities, obligations, judgments, penalties, fines, forfeitures, costs and expenses, including, without limitation, legal feesand expenses, that result from the pledge of any Residential Mortgage Collateral that does not comply in all materialrespects with applicable Anti-Predatory Lending Laws or this APL Policy.The Bank will not knowingly accept as eligible collateral Residential Mortgage Collateral that violates applicable Anti-PredatoryLending Laws or this APL Policy. If the Bank knows or discovers that such Residential Mortgage Collateral violatesapplicable AntiPredatory Lending Laws or this APL Policy, the Bank may, in addition to all available rights and remedies atlaw or in equity (1) require the member to substitute eligible collateral, (2) value such Residential Mortgage Collateral at zerofor collateral purposes, and (3) require the member to undertake a review of its policies, practices, and procedures forcomplying with the Bank’s collateral policies.Appendix BMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 56

Appendix B – Anti-Predatory Lending Policy cont’d.Anti-Predatory Lending PolicyPer the terms and conditions of the Bank’s Participating Financial Institution Agreement (“PFI Agreement”), each member-PFI has represented and warranted to the Bank that it: (1) is aware of and will comply at all times with the MortgagePartnership Finance Origination Guide and the Mortgage Partnership Finance Servicing Guide (collectively the “MPFGUIDES”), including the anti-predatory lending policy and provisions contained therein; (2) will comply at all times with therequirements of all applicable Anti-Predatory Lending laws; (3) will sell only eligible Residential Mortgages that comply in allmaterial respects with applicable Anti-Predatory Lending Laws; and (4) will indemnify, defend and hold the Bank harmlessfrom and against all losses, damages, claims, actions, causes of action, liabilities, obligations, judgments, penalties,fines, forfeitures, costs and expenses, including, without limitation, legal fees and expenses, that result from the sale ofany Residential Mortgage that does not comply in all material respects with applicable Anti-Predatory Lending Laws.The anti-predatory lending policy and related provisions contained in the MPF Guides, as may be amended, are adoptedas policy by the Bank as they relate to Acquired Member Assets.Appendix BMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 57

Appendix C – Subprime and Nontraditional Loan GuidelinesSubprime and NontraditionalLoan GuidelinesThe purpose of these guidelines is to establish the risk-management guidelines and exposure limits around subprime andnontraditional mortgage loans accepted as collateral for advances by the Bank.Definitions• A “subprime loan” is a loan where the representative FICO score of any borrower relied upon as a source of repaymentfor the loan is 660 or lower. The representative FICO score is the one most recently obtained by the member. If themember obtains two FICO credit scores for a borrower, the lower of the two scores is the representative FICO score.If the member obtains three FICO scores for a borrower, the middle score is the representative FICO score. When thereare multiple borrowers, determine the applicable representative score for each individual borrower (as above) and selectthe lowest applicable score from the group of borrowers as the representative credit score for the mortgage. The FICOscore is the primary means by which the Bank identifies a subprime loan. The FICO score should be used to identifya subprime loan whenever possible. In some cases, a FICO score is not available. In these cases, the Bank defines asubprime loan as a loan to a borrower with a weak credit history. A weak credit history is characterized by a history oflate payments, bankruptcy, judgments, repossession, and/or foreclosure.• A “nontraditional loan” is a mortgage loan that allows the borrower to defer repayment of the principal. Nontraditionalmortgage products include such products as “interest-only” mortgages where a borrower pays no loan principal for thefirst few years of the loan, and mortgage products that have balloon features at the maturity date.• A “subprime MBS” is a non-agency MBS where the underlying pool of mortgage loans at the time of the origination of thesecurity has a weighted average FICO score below 660 and/or where the underlying mortgage pools includes subprimeloans in an amount greater than one-third of the pool balance.• A “nontraditional MBS” is a non-agency MBS where more than one-third of the underlying mortgage pool at the time oforigination of the security consists of nontraditional loans.Advances Collateral – LoansThe Bank accepts subprime loans and nontraditional loans that are underwritten in accordance with applicable regulatoryguidance as eligible collateral for Bank advances. Any loans that meet the definition of a subprime and/or nontraditional loanin accordance with these guidelines and that were originated on or after July 10, 2007, must comply with the “InteragencyGuidance on Nontraditional Mortgage Product Risks” and “Statement on Subprime Mortgage Lending” issued by the federalbanking regulators on October 4, 2006, and July 10, 2007, respectively. If any such loan does not comply with this guidanceas applicable, it is not eligible as collateral. In addition, the Bank does not accept as eligible collateral any mortgage loanthat allows for negative amortization of the principal balance, including, but not limited to, pay-option ARM mortgage loans.The Bank recognizes that these types of loans may present incremental credit risk to the Bank. Therefore, the Bank hasmonitoring and review procedures in place to measure the incremental risk presented by this collateral and to mitigate thisincremental credit risk.Appendix CMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 58

Appendix C – Subprime and Nontraditional Loan Guidelines cont’d.Subprime and NontraditionalLoan GuidelinesExposure MonitoringMembers in Category 1 status disclose in their collateral reporting the amount of subprime loans and nontraditional loansthat are included in their collateral pledge. Members in Category 2 or Category 3 status are required to submit a detailedlisting of the loan collateral that they pledge to the Bank. Based on this analysis, the Bank may determine to increase thediscount applied to the collateral or to exclude it as eligible collateral.Risk Limits and Collateral ValuationThe Bank recognizes that subprime and nontraditional loans pose incremental credit risk to the Bank. In recognition of thispotential incremental risk, the Bank applies higher collateral valuation discounts to nontraditional and subprime loans of35 percent and 40 percent, respectively, when such loans are pledged by Federal Home Loan Bank of Boston membersin Category 1 without a specific listing. The Bank establishes discounts for subprime and nontraditional loans pledged bymembers that specifically list or deliver this collateral based on its risk analysis of the loans pledged. The Bank does notaccept loans that meet the definition of both a subprime loan and a nontraditional loan without a specific listing from anymember, regardless of collateral status. In addition, the Bank limits the amount of borrowing capacity that a member mayderive from subprime loan collateral to the lower of two times its most recently reported GAAP capital or one-half of its totalborrowing capacity.Advances Collateral – Mortgage-Backed SecuritiesThe Bank does not accept Nontraditional MBS or Subprime MBS as collateral for advances. Any security acquired by themember on or after July 10, 2007 that includes a loan or loans that meet the definition of a Subprime and/or NontraditionalLoan in accordance with these guidelines must comply with the “Interagency Guidance on Nontraditional Mortgage ProductRisks” and “Statement on Subprime Mortgage Lending” issued by the federal banking regulators on October 4, 2006 andJuly 10, 2007, respectively. The member must obtain and enforceable representation and warranty from the issuer of thesecurity that all of the loans comply with the guidance noted. If the member is unable to obtain such a representation andwarranty from the issuer, then the security will not be eligible as collateral.For all pledges of non-agency MBS collateral, members must complete a pre-pledge checklist describing the security andthe collateral backing the security. Based on this pre-pledge checklist and other analytical tools available to the Bank,including Bloomberg, rating agency subscriptions, and Intexnet, the Bank assesses the credit risk associated with thesecurity based on the risk profile of the underlying loan collateral, structural or third-party credit enhancements to thesecurity, and the collateral valuation discount applied. Based on this analysis of the security, the Bank may determine not toaccept a security as collateral, or to adjust the collateral valuation discount applied.Appendix CMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 59

Appendix C – Subprime and Nontraditional Loan Guidelines cont’d.Subprime and NontraditionalLoan GuidelinesAdvances Collateral – Mortgage-backed SecuritiesThe Bank does not accept nontraditional or subprime MBS as collateral for advances. Any security acquired by the memberon or after July 10, 2007, that includes a loan or loans that meet the definition of a subprime and/or nontraditional loan inaccordance with these guidelines must comply with the “Interagency Guidance on Nontraditional Mortgage Product Risks”and “Statement on Subprime Mortgage Lending” issued by the federal banking regulators on October 4, 2006, and July 10,2007, respectively. The member must obtain and enforceable representation and warranty from the issuer of the security thatall of the loans comply with the guidance noted. If the member is unable to obtain such a representation and warranty fromthe issuer, then the security will not be eligible as collateral.For all pledges of non-agency MBS collateral, members must complete a pre-pledge checklist describing the securityand the collateral backing the security. Based on this pre-pledge checklist and other analytical tools available to the Bank,including Bloomberg, rating agency subscriptions, and Intexnet, the Bank assesses the credit risk associated with thesecurity based on the risk profile of the underlying loan collateral, structural or third-party credit enhancements to thesecurity, and the collateral valuation discount applied. Based on this analysis of the security, the Bank may determine notto accept a security as collateral, or to adjust the collateral valuation discount applied.Appendix CMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 60

Appendix D – Advances ConfirmationsThe following advances confirmations canbe downloaded in PDF format.Confirmation for Amendment and Restatement of AdvanceConfirmation for Amortizing AdvancesConfirmation for Capped AdvancesConfirmation for Classic Plus Cap AdvancesConfirmation for Collared AdvancesConfirmation for Corridor AdvancesConfirmation for Community Development Member Option AdvancesConfirmation for Community Lending AdvancesConfirmation for Curve Flattener or Steepener AdvanceConfirmation for Daily Cash Manager AdvancesConfirmation for Discount Note Floating Auction Rate AdvancesConfirmation for Expander AdvancesConfirmation for Fixed-Rate AdvancesConfirmation for HLB Convertible Option Advances (Flipper)Confirmation for HLB Convertible Option Advances (Flipper with Guaranteed Flip)Confirmation for HLB-Option AdvancesConfirmation for HLB-Option Plus Cap AdvancesConfirmation for Knockout AdvancesConfirmation for LIBOR Floating Rate AdvancesConfirmation for Member Option AdvancesConfirmation for Rollover Cash Manager AdvancesConfirmation for Slider Advances (LIBOR Floating Rate Advance with Declining Rate Participation)Confirmation for Symmetrical Prepayment AdvancesSupplement-A to Application for AdvanceAppendix DMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 61

Appendix E – Borrowing DocumentationBorrowing DocumentationDepository Institution MembersAll depository institution members are required to executethe Agreement for Advances, Collateral Pledge, and SecurityAgreement (Advances Agreement), which establishes theBank’s lien on all eligible member assets to secure allextensions of credit.Insurance Company MembersAs an alternative to executing our standard AdvancesAgreement, insurance company members may execute theAgreement for Advances, Collateral Pledge, and SecurityAgreement for Insurance Company Members, whichestablishes a specific lien on assets pledged to us to secureall advances made to the member by the Bank. Because oflaws and regulations in their particular states, certaininsurance companies may be required to execute specialAdvances Agreements designed for members in thosestates. Connecticut insurance company members requiresuch special Advances Agreements.Non-Depository Community Development FinancialInstitution MembersAs an alternative to executing our standard AdvancesAgreement, non-depository community developmentfinancial institution members may execute the Agreement forAdvances, Collateral Pledge, and Security Agreement forNon-Depository Community Development Financial InstitutionMembers, which establishes a specific lien on assetspledged to us to secure all advances made to the memberby the Bank.All MembersAll members must file an anti-predatory lending statementwith the Bank as a requirement for borrowing.Other DocumentationThe Bank reserves the right to require, in its sole discretion,additional documentation, including, without limitation,agreements, resolutions, certifications, legal opinions, andapplications, as a pre-condition to any member obtainingan extension of credit from the Bank.Appendix EMain Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 62

Bank ContactsBank ContactsCustomer Service 1-800-358-9709 customerservice@fhlbboston.comCredit 1-617-292-9795 credit@fhlbboston.comCollateral 1-617-292-9729 collateral@fhlbboston.comHousing and Community Investment 1-888-424-3863 housing@fhlbboston.comMoney Desk 1-800-357-3452 moneydesk@fhlbboston.comMortgage Partnership Finance ® 1-888-424-3863 mpf@fhlbboston.comRelationship Managers 1-888-424-3863 memberservices@fhlbboston.com“Mortgage Partnership Finance” is a registered trademark of the Federal Home Loan Bank of Chicago.Main Telephone: 617-292-9600 • Customer Service: 1-800-358-9709 • Money Desk: 1-800-357-3452 • Relationship Managers, MPF, and Housing & Community Investment: 1-888-424-3863 63