2025 Impact Report|03 Jul, 2026
Insights|30 Jul, 2026
Consider the Dividend
On July 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 to be paid on the average of outstanding stock from April 1 to June 30, 2026.
As a cooperative FHLBank San Francisco seeks to return value to our member-owners and the communities they serve. Increased use of products and services results in capital available for distribution through dividends and housing and economic development grants and programs.
Dividends also benefit members by lowering the effective cost of borrowing to meet their liquidity and asset and liability management needs, as shown by the two examples below.
Scenario A: Members borrowing above their membership stock requirement
The Q2 2026 10.00% dividend on Activity-based stock lowers the effective cost of $1 million in new advance borrowing by 17 basis points, or $2,700. This example includes the cost of an FHLBank San Francisco advance and additional capital stock, as well as the opportunity cost of funding that capital stock.
Scenario B: Members borrowing below their membership stock requirement
The dividend spread between Activity-based and Membership-based stock lowers the effective cost of $1 million in new advance borrowing by 14 basis points, or $1,417. This example reflects using existing membership stock for borrowing, not requiring the purchase of additional capital stock.
Special Dividend Impact
The inclusion of the $75 million special dividend along with the quarterly Q2 2026 dividend lowers the effective cost of funds by between 37 and 47 basis points depending on the member’s mix of Membership-based and Activity-based capital stock4.
Historical Dividend Rate and Dividend Effect
The figures below show the recent history of FHLBank San Francisco dividend rates and the corresponding reduction in the cost of funds.
Click here for more dividend history
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.
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.
Footnotes
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 Q2 2026, FHLBank activity and membership dividend rates are 10.00% and 4.75%, respectively, payable in August 2026.
2. As of July 15, 2026.
3. Assume an opportunity cost of purchasing capital stock to be 3.65%, the average U.S. Federal Reserve Interest on Reserve Balances during Q2 2026.
4. Based on Q2 2026 FHLBank activity and membership dividend rates are 10.00% and 4.75%, respectively, as well as the $75 million special dividend (25%/75% allocation membership/activity capital stock) paid out in August 2026.
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