Products and Solutions Guide - Federal Home Loan Bank of Boston
Products and Solutions Guide - Federal Home Loan Bank of Boston
Products and Solutions Guide - Federal Home Loan Bank of Boston
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Advances PricingAdvances PricingThe <strong>Bank</strong> prices credit products consistently <strong>and</strong> withoutdiscrimination to all members applying for advances nomatter the size <strong>of</strong> the financial institution. We must alsoensure regulatory compliance while making advancespr<strong>of</strong>itable in order to meet our financial performanceobjectives <strong>and</strong> 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 <strong>of</strong> matching term <strong>and</strong>maturity funds in the marketplace, including embeddedoptions, <strong>and</strong> the administrative cost associated with makingsuch advances to members. However, we may priceadvances on a differential basis, such as the creditworthiness<strong>of</strong> members, volume, or other reasonable criteriaapplied consistently to all members.With these regulatory parameters in mind, we price all creditproducts according to market conditions <strong>and</strong> the followingspecific criteria:• The <strong>Bank</strong>’s cost <strong>of</strong> funds;• The <strong>Bank</strong>’s cost <strong>of</strong> delivering products (general <strong>and</strong>administrative expenses); <strong>and</strong>• <strong>Bank</strong> pr<strong>of</strong>itability targets <strong>and</strong> risk/return objectives.The <strong>Bank</strong>’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 <strong>and</strong> dynamic. As a result, pricingis subject to change more frequently <strong>and</strong> at irregularintervals compared with other advances products.PAID ProgramWe <strong>of</strong>fer discounts on the Rollover Cash Manager, Classic,Amortizing, <strong>and</strong> Symmetrical Prepayment advance productswith at least one year to maturity based on the member’spercentage <strong>of</strong> advances to assets under the Percent <strong>of</strong>Assets Incentive Discount (PAID) program. The discountsunder this program are one, two, <strong>and</strong> three basis points formembers with advances-to-assets ratios <strong>of</strong> 10 percent, 15percent, <strong>and</strong> 20 percent, respectively. These discounts applyonly to rates on programs outside the AHP, CDA, <strong>and</strong> NEFprograms that are not discounted in any other way.Special Advance OfferingsFrom time to time, the <strong>Bank</strong> <strong>of</strong>fers scheduled <strong>and</strong> unscheduledspecials on pricing.In order to promote equal access to “special” pricing to allmembers, we <strong>of</strong>fer specials that approximate those <strong>of</strong>feredfor 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, <strong>and</strong> Housing & Community Investment: 1-888-424-3863 30
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