About Debt Securities

The FHLBanks raise funds for member lending, mortgage programs and other balance sheet needs through the daily sale of debt securities (known as consolidated obligations) in the global capital markets. FHLBank debt issuance volume generally rises and falls in proportion to member loan demand, but overall, we are one of the largest and most frequent debt issuers in the world. Funds raised through the sale of bonds and discount notes typically carry a lower interest rate than FHLBank members could obtain on their own, and enable member financial institutions to provide lower-cost mortgage credit to homebuyers and housing agencies. The Office of Finance coordinates debt issuance for the FHLBanks, and acts as the FHLBanks' fiscal agent. Buyers of debt securities issued by the FHLBanks represent the entire spectrum of domestic and international fixed-income investors, including commercial banks, central banks, investment managers, major corporations, pension funds, government agencies, and individuals.

Consolidated obligations consist of consolidated bonds and consolidated discount notes. All consolidated obligations carry credit ratings from both Moody's (Aaa and P-1) and Standard & Poor's (AA+ and
A-1+). These high ratings are based on the excellent asset quality of the FHLBanks, conservative risk-adjusted capitalization, conservative underwriting standards, quality monitoring policies, and our cooperative structure. This organizational structure, unique among housing-related government-sponsored enterprises, also provides strong credit support through the concept of joint and several liability. The key role played by the FHLBanks during the credit crisis of 2007-2008 and again during the market volatility which occurred in March 2020, highlights its critical role in U.S. housing finance. Principal and interest from all consolidated obligations are backed by the financial strength of the entire FHLBank System, contributing to the desirability of FHLBank debt to investors worldwide.

The FHLBanks believe the best way to effectively distribute the wide variety of debt securities they issue is through a broad network of authorized dealers both in the U.S. and abroad.

For additional detail on specific FHLBank debt products and options, please refer to the desired topic in this section.

For historical debt issuance tables, please see the Debt Statistics page.