December 3, 2015
Consider the Many Ways in Which You Can Leverage Your Relationship With the FHLBNY
On November 19, the FHLBNY declared a 4.10% dividend for the third quarter of 2015. The following day, the FHLBNY distributed $54.5 million in dividend payments to our members. In each of the first three quarters of the year, our dividend has been 4.10% and, through the first nine months of 2015, the FHLBNY has paid $163.8 million in dividends, a steady return on our members’ investment in our cooperative. This stability in our dividend is consistent with our history: the FHLBNY has long provided our members with a consistent and reasonable quarterly dividend.
A Strategic Focus
This consistency in our dividend is reflective of the overall strength and stability of our franchise. This is seen in the daily availability of our advances – we closed the month of October with $88.8 billion in funding being put to work by our members.
It is seen in our steady performance: at the end of the third quarter, the FHLBNY was the largest cooperative in the Federal Home Loan Bank System as measured by advances and the second-largest in assets. And it is also seen in the very words that guide our institution, our Strategic Vision and our Mission:
Strategic Vision: “To be a balanced provider of liquidity to members in all operating environments.”
Mission: “To advance housing opportunity and local community development by supporting members in serving their markets.”
Our Strategic Vision and our Mission are at the center of our overall strategy. Our strategy has served us well over the years, evolving from a focus on growing our membership post-FIRREA to a commitment to being an “Advances Bank” a decade ago.
I am pleased to announce that at its November 2015 meeting, our Board of Directors approved the FHLBNY’s three-year Strategic Plan for 2016-2018. Our cooperative is financially and strategically strong and, as a result, the theme for our new Strategic Plan is to “Evolve from a Strong Base.” From this strong base, we are well-positioned to monitor emerging trends in our operating environment and determine which present the best opportunities for us to strengthen our cooperative, and which present challenges we must address to ensure our stability. We believe that our Strategic Plan is flexible enough to help us navigate through a wide variety of market conditions, continue to meet the daily and long-term needs of our members and fulfill our mission to advance housing and local community development.
Over the past 18 months, our Board and our management team have dedicated significant time and attention to developing our Strategic Plan. This effort was led by our Board’s Strategic Planning Committee and our internal Strategic Planning Team, which drew staff from every function across our institution to provide a holistic view of our franchise. The team worked closely with our Management Committee, as well as with outside experts, in developing this Plan. We took into account potential changes to the operating environment that could pose business or operational risks — both those that could be significant enough to affect our strategy or business model, and those small enough to be considered distractions that would require a refocusing of resources.
The FHLBNY continues to perform well and meet the needs of our members. Our Strategic Plan will provide us with flexibility to pursue and develop growth opportunities and, as always, continue to focus on enhancing the value of membership.
25 Years of the Affordable Housing Program and 20 Years of the First Home Clubsm
One of our Strategic Objectives is to provide value to the membership through relevant, mission-oriented products and services. Since its creation 25 years ago, the Affordable Housing Program (AHP) has become part of the fabric of our cooperative. It is a reflection of our mission and our purpose, and its relevance to our members and the communities we serve has never been stronger.
Last month, our AHP — and our Community Investment Officer, Joe Gallo, who will retire from the FHLBNY at year-end after serving our cooperative for 28 years and leading every AHP funding round we have offered — were celebrated by Neighborhood Housing Services of New York City, Inc. (NHS) at its annual gala. It was a true honor for our entire team to be recognized by NHS because the AHP continues to work so well, simply because it works in support of the terrific efforts of housing organizations like NHS, and the partnerships these organizations have with our members at the local level. Our members and these organizations are the ones who know the needs of the communities they serve. They are the ones who bring families and individuals to our attention and submit grant applications on their behalf. And they are the ones who keep coming back to these programs, year after year. Our members and their community partners are working to make people’s lives better, and for the past 25 years, we have been proud and honored to work alongside them.
This work continued last month, when our Board approved our 2015 round of AHP grants. The FHLBNY will award $27.1 million to 35 initiatives to help create or preserve 2,576 affordable homes. Of this total, 1,955 units will support very low-income households, and 2,539 will be affordable rental units. Over the past 25 years, our AHP has awarded more than $515 million in grants to 1,450 projects across our District, helping to create or preserve more than 65,000 affordable homes. Check out the latest press release on “FHLBNY Awards $27.1 Million for 35 Affordable Housing Initiatives”.
This year’s NHS gala had the theme of “Connecting to Communities,” and our AHP provides us with a significant way to connect with the communities we serve. But it is not the only way we connect. This year also marks the 20th anniversary of our First Home Clubsm (FHC), which we launched in 1995 to offer an incentive for households with incomes at or below 80 percent of area median income to save towards the purchase of a new home. The FHC, which is a non-competitive set-aside of the AHP, provides down payment and closing cost assistance — often two significant barriers to homeownership — through grants of up to $7,500 by matching $4 for each $1 saved in a dedicated account to an eligible first-time homebuyer purchasing a home through one of our approved members. Since 1995, we have provided $74 million in grants to help assist 10,525 households become first-time homeowners, including 9,430 new homeowners in New York. For more information on these programs, please contact your Relationship Manager at (212) 441-6700.
COMMUNITY LENDING PROGRAMS (CLP)
Obtain funding at our lowest advance rates for projects that create housing, improve business districts, and strengthen neighborhoods.
In 2015 total CLP advances funded were over $1.4B (as of 11/16/15).
More information on CLP advances can be found here.
Providing community support is a priority for our business, and it is also a personal focus of our employees. This year, our employees adopted the theme of “Let’s Give Back” for all of our employee teambuilding events, centered on activities that help our communities across the District. We started with “PaintFest,” an event organized by The Foundation for Hospital Art to boost the spirits of patients and help the healing process.
We started with “PaintFest,” an event organized by The Foundation for Hospital Art to boost the spirits of patients and help the healing process. Our employees gathered to paint murals, which were donated to centers providing family and veteran care. Our employees have filled and distributed backpacks for foster children for the school year, volunteered in our annual Habitat for Humanity home build, fed 500 homeless through their work with NYC Relief Bus, raised money for the Special Olympics of New Jersey through family activities, helped “Make Strides against Breast Cancer,” raised money for the Ronald McDonald House, and sponsored a winter coat drive. These events have helped bring our colleagues closer together and build on our connection to the community, all while strengthening the culture of our cooperative. Read more on LinkedIn.
Our community-focused culture drives us. The 2016-2018 Strategic Plan is a result of a significant amount of work and analysis. But at the end of that work, we determined that the FHLBNY’s mission and vision are still as relevant today as they were three years ago when we last developed a strategic plan. And they are as relevant today as they have been at any point during our 83-year history. We developed our Strategic Plan with our Guiding Principles in mind, and as a result, our Strategic Plan will help us make decisions that strengthen our cooperative, advance our people, uphold our integrity and sustain the communities we serve in partnership with our members. We have long taken pride in being a reliable partner for our members, and our strategy will ensure that we remain your reliable partner.
José R. González
President and Chief Executive Officer
# # #
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This report may contain forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as “projected,” “expects,” “may,” or their negatives or other variations of 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. These forward-looking statements involve risks and uncertainties including, but not limited to, regulatory and accounting rule adjustments or requirements, changes in interest rates, changes in projected business volumes, changes in prepayment speeds on mortgage assets, the cost of our funding, changes in our membership profile, the withdrawal of one or more large members, competitive pressures, shifts in demand for our products, and general economic conditions. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.
Report from the President: A Vital Conversation
FHLBNY Commences 2020 Board Of Directors Election Process
Enhancements to the Refundable MULOC Product
A Review of Housing Statistics at the End of 2019
Five Ways to Manage Your Balance Sheet in a Volatile Rate Environment