Give Your Institution the Strategic Flexibility to Maintain a Competitive Edge
Whatever your specific funding needs, the HLB has a credit product designed to meet your objectives. Members can customize advances with a wide variety of maturities and structures, enabling you to conservatively match assets and liabilities. HLB advances can be customized by size, settlement date, amortization schedule, call/put options, and more.
If this is your first time borrowing with the HLB, we created an interactive First Time Borrowers Guide to assist members who want to initiate their first borrowing.
Click on an advance for more information or view a printable version of all the descriptions.
As a true cooperative, all of our members are treated equally, regardless of asset size; your institution will receive the same terms, whether you are borrowing $1 million or $100 million.
A quick source of liquidity to help manage daily cash flows and provide funding for various short-term uses
- Same-day access to funds for immediate cash needs
- Ability to borrow up to maximum borrowing capacity
- No additional borrowing limit restrictions above standard HLB credit and collateral limits
- No set-up or renewal fees
- Can be initiated conveniently through 1Linksm, our secure internet banking system (Receive a 4 bps discount on the overnight rate when initiated through 1Link)
Note: On September 7, 2010, the new Overnight Advance replaced the existing Overnight Repricing Advance Program and its associated companion products, the Overnight Line of Credit (OLOC), OLOC Plus, OLOC Companion, and OLOC Companion Plus...more
Achieve a wide variety of financial management goals, with maturities ranging from 2 days to 30 years
- Meet liquidity needs
- Fund long-term assets
- Lock in rates for future funding purposes
- Forward start dates are available
The HLB also offers the Callable Fixed-Rate Advance, where the borrower has the option of prepaying funding without any penalty. Please contact a Calling Officer for more information.
Obtain competitively priced funds when using Treasury or Agency issued Mortgage-Backed, or CMO securities collateral
- Effectively utilize your securities portfolio as collateral
- No penalties for pledging smaller blocks of securities
- Receive the same low rates for AAA-rated Agency and Non-Agency securities
- Maturities from 2 days to 10 years
Adjustable-Rate Credit (ARC) Advance
Match the interest rate characteristics of your adjustable-rate loan portfolio
- Reduce basis risk by funding adjustable rate assets with financing tied to the same repricing index
- Can be tailored to meet specific financing needs with a wide range of maturities, up to 10 years
- Can be linked to a wide variety of indices, including 1-, 3-, and 6-month LIBOR, Treasury bills, notes, and bonds, and Fed Funds
- Limit exposure to rising rates by using an embedded rate cap
Manage interest rate risk by setting your own quarterly principal payoff schedule to closely match cash flows between your funding and mortgage assets
- Achieve funding flexibility by creating your own payoff schedule
- Better match-fund the duration and amortization characteristics of mortgages, an MBS pool or other assets
- Maturities from 1 to 30 years
Fixed-Rate Advance with a LIBOR Cap
Combines a fixed-rate borrowing with an embedded interest-rate cap in which the rate remains fixed but may be reduced quarterly if 3-month LIBOR rises above the pre-selected cap
- Provides protection against rising interest rates (lowers your institution’s cost of funds as rates rise)
- Flexible medium-long-term funding option best used to extend liabilities, potentially enhance spreads, and preserve margins
For more information on how the Fixed Rate with Cap can help meet your institution’s funding needs please visit our Fixed-Rate Advance with a LIBOR Cap Page.
Match the amortization characteristics of your fixed-rate mortgage portfolio
- Enhance match funding of long-term assets
- Borrow fixed-rate funds with the option of customizing the amortization schedule to match a selected prepayment profile
- Maturities and amortization schedule from 1 to 30 years
An advance with built-in prepayment options that can help members reduce interest rate risk and prepayment risk at minimal added cost
- More closely fund fixed-rate mortgages
- Take advantage of downward movements in interest rates and steep yield curves
- No prepayment fee when called on specified date
- Good hedging tool against mortgage loan prepayment risk
For more information on how the Callable Advance can help meet your institution’s funding needs read our Strategies article.
Interest Rate Swaps
Reduce risk in your balance sheet caused by the fluctuations in interest rates with these instruments, which normally involve an exchange of a fixed payment for a payment that is not fixed, such as LIBOR, based on a specified principal amount
- Lower the cost of funding
- Hedge interest rate exposure or increase the certainty of future funding costs
- Achieve asset/liability management goals
Interest Rate Caps, Collars & Floors
Reduces income fluctuations caused by interest rate volatility
- Caps - can protect you against a rise in interest rates and limit the interest cost on a floating-rate liability
- Floors - can limit the impact to earnings from significant declines in interest rates
- Collars - gives you protection against both rising and falling interest rates
A wide array of maturities and lockouts for medium- to long-term funding where the HLB owns an option to terminate the advance at specified times
- Competitive pricing
- Customize maturities from 2 to 10 years and lockout periods from 3 months to 7 years
- One-time or quarterly option exercise
- Customized strikes are available
› View Putable Rate Information
Principal-Deferred Advance (PDA)
A hybrid advance product that combines elements of the Fixed-Rate and Amortizing Advance. It begins as a Fixed-Rate Advance, allowing members to choose a specific amount of time they would like to defer the principal payment of the advance up to 5 years. When the lockout or principal-deferred period ends, the advance becomes an Amortizing Advance, where the member makes principal and interest payments on the loan up to another 30 years.
- Valuable asset/liability management tool
- Fully amortizing backend with a choice of varying balloon terms
- Mirrors characteristics of a typical construction deal with a permanent take-out
- No embedded options in the advance
For more information on how the PDA can help meet your institution’s funding needs please visit our PDA Page.