1.2.1: Capital Requirements
Each FHLBank operates at or above its minimum capital requirement. Other Information:
In December 2000, the Finance Board adopted risk-based and total capital standards as required by the Gramm-Leach-Bliley Act
of 1999.1 Each FHLBank’s risk-based capital requirement is based upon the credit, market, and operational risks it assumes.
An FHLBank must report its risk-based capital requirement by component, as well as total capital and permanent capital, at
least monthly to the Finance Board. The Finance Board monitors compliance with applicable capital requirements and evaluates
capital management policies and procedures as part of the on-site examination of the FHLBanks. In addition, the Finance Board
monitors the FHLBanks to be assured that they remain profitable, and given their risk profile, maintain retained earnings
at a level that is sufficient to prevent impairment of the value of their capital stock.
Indicator(s):
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