Products and Solutions Guide - Federal Home Loan Bank of Boston

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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
Page 4 and 5: IntroductionBuilding Communities -B
Page 6 and 7: Overnight Funding - Daily Cash Mana
Page 8 and 9: Overnight Funding - IDEAL Cash Mana
Page 10 and 11: Fixed-Rate Advances - Classic Advan
Page 12 and 13: Fixed Rate Advances - Community Dev
Page 14 and 15: Fixed-Rate Advances - Forward Start
Page 16 and 17: Fixed-Rate Advances - HLB-Option Pl
Page 18 and 19: Fixed-Rate Advances - Member-Option
Page 20 and 21: Fixed-Rate Advances - The New Engla
Page 22 and 23: Long-Term Variable-Rate Indexed Adv
Page 32 and 33: Advance RestructuringAdvance Restru
Page 34 and 35: Letters of CreditLetters of CreditS
Page 36 and 37: Asset-Purchase ProgramsAsset-Purcha
Page 38 and 39: Underwriting RequirementsUnderwriti
Page 42 and 43: Collateral Requirements cont’d.1
Page 44 and 45: Collateral Requirements cont’d.Us
Page 46 and 47: Collateral Requirements cont’d.Co
Page 48 and 49: Appendix A - Eligible Collateral an
Page 58 and 59: Appendix B - Anti-Predatory Lending
Page 60 and 61: Appendix B - Anti-Predatory Lending
Page 62 and 63: Appendix C - Subprime and Nontradit
Page 64 and 65: Appendix D - Advances Confirmations
Page 66: Bank ContactsBank ContactsCustomer

Products and Solutions Guide - Federal Home Loan Bank of Boston

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