Bulletins

November 6, 2019

Announcing the Callable Adjustable Rate Credit Advance Pilot Program

The Federal Home Loan Bank of New York (FHLBNY) is pleased to announce the pilot* launch of the Callable Adjustable Rate Credit Advance (Callable ARC).

The Callable ARC offers two distinct option structures that give members the flexibility to meet the demands of a fluctuating balance sheet.  Members can use the call feature to strategically extinguish (and potentially rebook) the advance when the remaining term reaches either a 1-month-left-to-maturity or 1-year-left-to-maturity window, affording greater control in managing liquidity needs with no additional prepayment fees.

The Callable ARC will be available with either 1-month LIBOR or Secured Overnight Financing Rate (SOFR) indices with the following product structures:

 

Callable ARC Advance: 1-Month Call at the End

 

Terms

7-month minimum term with a 1-month-left-to-maturity call option

Available Indices 1-month LIBOR or SOFR
Maturities 1-month LIBOR maturities not available beyond 12/31/2021; 3-year maximum term for advances tied to SOFR
Option Structure One time European (Euro) call option
Example 7 month Non-Call 6 month
7mNC6m (Euro)

 

Callable ARC Advance: 1-Year Call at the End

 

Terms

3-year minimum term with a 1-year-left-to-maturity call option

Available Index SOFR
Maturity 3-year is the maximum term (at this time)
Option Structure One time European (Euro) call option
Example 3 year Non-Call 2 year
3yNC2y (Euro)

 

*Please note: Due to limited amounts available at this time, funds will be distributed on a first-come, first-served basis.

 

 

Advantages of the Callable ARC Advance:

 

 

An advance with a call option that can help members flexibly manage their liquidity needs

 

Affords members the ability to manage their balance sheet and capital levels more tightly

 

Can be tailored to meet specific financing needs

 

Allows members to take advantage of potential changes to ARC rates, should the rate on the ARC advance improve or worsen with market volatility

 

No prepayment fees when the call option is exercised on the pre-determined date, adding flexibility to extinguish or rebook the advance

 

Can be linked to either 1-month LIBOR or SOFR indices, enabling members to match the interest rate characteristics of adjustable-rate assets

 

If you would like additional information, please contact a Relationship Manager at (212) 441-6700
or a Member Services Desk Representative at 1-800-546-5101, option 1.

 

Disclaimer: Notwithstanding any language to the contrary, nothing contained in this disclosure is intended to constitute an offer, inducement, promise, or contract of any kind. This product description and pricing may be subject to change without notice.

The content provided in this disclosure is presented as a courtesy to be used only for informational purposes and is not represented to be error free. The Federal Home Loan Bank of New York (FHLBNY) makes no representations or warranties of any kind with respect to the content contained herein, such representations and warranties being expressly disclaimed. The FHLBNY is not a financial or investment advisor.

Moreover, FHLBNY does not represent or warrant that the content of this disclosure is accurate, complete or current for any specific or particular purpose or application. It is not intended to provide nor should anyone consider that it provides legal, accounting, tax or other advice. Such advice should only be rendered in reference to the particular facts and circumstances appropriate to each situation. FHLBNY encourages you to contact appropriate professional(s) and consultant(s) to assess your specific needs and circumstances and to render such advice accordingly. In addition, FHLBNY is not endorsing or recommending the use of the means or methods contained in or through this disclosure for any special or particular purpose.

It is solely your responsibility to evaluate the risks or merits of any funding or investment strategy. In no event will FHLBNY or any of its officers, directors or employees be liable for any damages – whether direct, indirect, special, general, consequential, for alleged lost profits, or otherwise – that might result from any use of or reliance on these materials.

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