Insights|14 Nov, 2025
Insights|01 Jun, 2026
Consider the Dividend
Beginning January 2, 2026, the Bank implemented a sub-class capital stock structure that provides the ability to declare a higher dividend rate on Activity-based stock versus Membership-based stock.
On April 24, 2026, FHLBank San Francisco’s Board of Directors declared quarterly cash dividends at an annualized rate of 4.75% on Membership-based stock and 10.00% on Activity-based stock for the average of outstanding stock from January 2, 2026, to March 31, 2026.
The scenarios below show the member’s cost savings of borrowings from dividends on Activity-based stock and Membership-based stock, which provides additional benefits in using FHLBank products for members’ liquidity and asset and liability management strategies.
Scenario A: Members borrowing above their membership stock level
Dividend-Adjusted Cost of Funds Example
The table below demonstrates how a dividend1 paid on your capital stock purchase lowers your effective cost of funds by 17 basis points using our Q1 2026 dividend rate as an example.
Scenario B: Members borrowing below their membership stock level
Dividend-Adjusted Cost of Funds Example
The table below demonstrates how a dividend1 spread (Activity vs Membership) paid on your capital stock lowers your effective cost of funds by 14 basis points using our Q1 2026 dividend rate as an example.
The special dividend paid in Q1 2026 based on Q4 2025 holdings further lowers your effective cost of funds.
Let’s talk about funding strategies to help meet your business goals, increase your Activity-based stock holdings and optimize any dividend returns in the coming quarters.
Historical Dividend Rate and Dividend Effect
The figures below show the recent history of FHLBank dividend rates and the corresponding reduction in the cost of funds.
Click here for more dividend history
Contact the Member Services Desk at (415) 616-2500 or your Relationship Manager to learn more about opportunities to lower borrowing costs.
References and Disclaimers
This article contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including statements related to the Bank’s dividend philosophy and dividend rates. These statements are based on our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as “endeavoring,” “will,” and “expects,” or their negatives or other variations on these terms. The Bank cautions that by their nature, forward-looking statements involve risk or uncertainty, and that actual results could differ materially from those expressed or implied in these forward-looking statements or could affect the extent to which a particular objective, projection, estimate, or prediction is realized, including future dividends. These forward-looking statements involve risks and uncertainties including, but not limited to, the uncertainty related to the declaration or payment of any dividends. In addition, the Bank reserves the right to change its plans for any programs for any reason, including but not limited to legislative or regulatory changes, changes in membership, or changes at the discretion of the board of directors. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. FHLBank San Francisco does not act as a financial advisor, and nothing herein is an offer to sell or a solicitation of an offer to buy any securities, financial instruments, or derivative products. You should consult your own legal, financial, and accounting advisors before entering into any transaction.
1 The decision to declare any dividend and the dividend rate is at the discretion of the Bank’s Board, which may choose to follow or not follow the dividend philosophy as guidance in the dividend declaration. The Board may also revise or eliminate the dividend philosophy in the future. The Bank’s historical dividend rates and the dividend philosophy are not indicative of future dividend declarations. As of Q1 2026, FHLBank activity and membership dividend rates are 10.00% and 4.75%, respectively, payable in May 2026
2 As of May 7, 2026
3 Assume an opportunity cost of purchasing capital stock to be 3.65%, the average US Fed Reserve Interest on Reserve Balances during Q1 2026
4 Assume members borrow above their membership stock level
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