The Bazemore Update

photo of Teresa Bryce Bazemore

Dear Valued Members,

This year, we are celebrating the 90th anniversary of the Federal Home Loan Bank System. When I think about the inception of the FHLBanks in 1932, at the height of the Great Depression, I’m reminded of the classic holiday film It’s a Wonderful Life. It’s not hard to imagine how valuable membership in his regional Federal Home Loan Bank might have been to the mythical character George Bailey when his Building and Loan Society, essentially a small community bank with a mortgage business, found itself in urgent need of liquidity. Ready and reliable access to the low-cost advances and financial expertise that FHLBanks provide would have made a world of difference to George, his financial institution, and the fictional community of Bedford Falls.

For nine decades, the Federal Home Loan Banks have played an integral role in an increasingly complex U.S. financial system. Created by Congress to be a reliable source of liquidity for home finance, over time the System’s membership and mission have expanded to meet the evolving needs of the marketplace, to include different types of members and a broader purpose of also supporting affordable housing and community development. Congress has also continually expanded the ways in which financial institutions can use FHLBank funding. Large and small members of our cooperative use the low-cost liquidity we provide to support housing, economic development, small businesses and job growth, as well as for balance sheet and interest rate risk management.

The value and efficiency of our scalable business model – as you know, the Banks are designed to be able to expand and contract funding to our members as marketplace and conditions dictate – has been tested and proven, especially in times of crisis. It was tested in the Great Recession, and again in the face of an unprecedented global pandemic: the FHLBanks are a dependable partner to our members in all economic environments and credit cycles. That’s why we expect that future evolutions of the System, should Congress choose to make any changes to our charter and mission, will be consistent with maintaining the safety, soundness, and stability of our successful, 90-year-old cooperative ownership structure and operating model.

Adding More Value to Your Membership

Given the cyclicality of advance demand, here at the San Francisco Bank we continually strive to add value to your membership in many different ways. In the first half of this year, we returned to an in-person format for our Spring Seminar, Strategies for Change, focused on how to navigate the emerging challenges of rising interest rates and inflation. Seminars in Southern California and at our offices in San Francisco brought you the insights of Will Taylor, Principal and Owner of Vining Sparks and Director of Portfolio Management Group, who examined the current economic impact of the changes we’re seeing and explored strategies for productive asset/liability management, along with the localized economic perspectives of regional experts.  

Also this past spring, we held our first Diversity, Equity, and Inclusion Symposium, which was a well-attended and well-received event aimed at helping members better understand the role that their institutions can play in narrowing the racial homeownership gap and reducing wealth disparities, while at the same time growing their business. Our expert panelists focused on how DE&I benefits business – from both the employee and the customer/business development points of view – and offered a deep-dive into the need for systemic change in the mortgage finance system. We were glad to have attendees representing many different aspects of the business at our member financial institutions – since DE&I does touch everything we do today. We are encouraged by the positive feedback we received to consider holding similar events in the future. In the meantime, look for highlights of the event that we will be sharing at the upcoming Member Conference. 

Our first in-person Member Conference since 2019 is coming up very soon, and I am excited to have an opportunity to meet more of our members in person at this event in September. With a Poised for the Future theme, our 2022 Member Conference is aimed at helping members anticipate and navigate both the challenges and opportunities that lie ahead. We have a diverse slate of dynamic speakers lined up to share their valuable expertise and insights on finance, macroeconomics, technology, human behavior, and organizational health. I hope to see you at the Ritz-Carlton, San Francisco, September 14–16! Learn more and register today.

Finally, in this issue of Bank Notes, learn more about what else is happening at FHLBank San Francisco. Team members from around the Bank have assembled this content – including recent news, credit and collateral trends and analysis, the view from our Trader's Corner, a look at how our Counterparty Credit department works, a profile of one of our newest members, and more – to keep you up-to-date and give you a peek behind the curtain of your cooperative. I invite you to let us know how we can better serve you, as well as what topics and features you would like to see in future issues of our member newsletter.

Thank you for your membership and ongoing engagement with our Bank. I look forward to getting to know you better and to learning more about how FHLBank San Francisco can help you move your business forward and make the communities we all serve more vibrant, equitable, and resilient.


Teresa Bryce Bazemore

President and CEO, FHLBank San Francisco