The Federal Home Loan Bank of San Francisco is a cooperative, wholesale bank that helps meet community credit needs by providing readily available, competitively priced credit products and services to member financial institutions through all phases of the economic cycle. Our members include commercial banks, credit unions, industrial loan companies, savings institutions, insurance companies, and community development financial institutions headquartered in Arizona, California, and Nevada.
For most financial institutions, especially small community lenders, direct borrowing from the global capital markets is not an option. As part of a network of 11 regional Federal Home Loan Banks across the country, we are able to raise funds in the global capital markets at favorable rates and terms. This allows us to provide our members with prompt, reliable access to low-cost loans (we call them “advances”) and financial risk management tools that help them meet the housing finance and economic development needs of the regions they serve.
Members use our products and services to help them lower their funding costs, reduce interest rate risk, manage liquidity, offer a wider range of credit products to their customers, and access lower-cost funding for affordable housing and economic development.
The credit we make available enables community lenders to make home mortgage, commercial real estate, small business, and other loans. Working with our members, community nonprofits, and cities and towns across our region, we also support affordable housing and economic development through targeted grant and loan programs. As part of this effort, we set aside 10% of our income each year to fund Affordable Housing Program grants for lower-income households.
Federal Home Loan Bank System
Congress established the Federal Home Loan Bank System in 1932 to promote residential housing finance nationwide. There are 11 district banks in the Federal Home Loan Bank System, located in Atlanta, Boston, Chicago, Cincinnati, Dallas, Des Moines, Indianapolis, New York, Pittsburgh, San Francisco, and Topeka.
Each Federal Home Loan Bank operates as an independent corporation, is governed by a Board of Directors that is elected by its member institutions, and is capitalized through stock purchased by its member institutions and through its retained earnings. The Federal Home Loan Banks raise funds in the capital markets by issuing debt instruments, for which they are jointly and severally liable, through the FHLBanks Office of Finance. They are regulated by the Federal Housing Finance Agency, an independent federal agency in the executive branch of the U.S. government, and they do not receive any taxpayer assistance to operate.