Message from Cindy Konich, President and CEO:

At FHLBank Indianapolis, we’re proud of our decades-long record as a reliable source of liquidity and affordable housing funding for our Indiana and Michigan members. Whether you are a longtime member or recent addition, we’re here for you – and have been in all economic cycles since 1932.

As you may have seen detailed in our year-end Q4 financials, the Bank finished well-positioned to continue our many successes together in 2022. Consider:

Solid financials: Our advances and other products found impressive traction among our members, posting record year-end activity that translated in elevated dividends. Read our news release here.

AHP-CIP increases: Our Board of Directors approved a 25% increase in dedicated funding for our affordable housing and community development initiatives in 2023. That means more funding going back into your communities and getting more of your sponsored projects across the finish line. More financial support is coming. Something I’ll share more about in the months ahead.

Community impact: Our newly released Corporate Social Responsibility Report is filled with powerful examples of how we make the world around us a better place. We’ve made substantial gains in affordable housing, economic development, and diversity, equity and inclusion by focusing on our at-risk communities. And the work continues. Please take a moment and read about our accomplishments here.

National front: The recently concluded Listening Tour organized by our regulator, the FHFA, featured testimony from across the country about the significant role the FHLBank system plays as a stabilizing force in the financial system. The roundtables surfaced potential areas for improvement, but overall the comments were positive. For those of you who provided feedback, thank you for your participation and support, because no one knows better the value we provide you and your community.

Our talented team and I thank you for the opportunity to show how our products and services can bolster your bottom line. Contact our Business Development team with any questions as we work toward another momentous year of business together!



Sincerely,

Cindy Konich

President and CEO

Asset Liability Management

Lessons From the Current Environment



Over the past month, we have been reminded of the importance of prudent balance sheet management practices and the potential impact rapidly changing interest rates can have on financial institutions. Changes in interest rates not only impact net interest margins but also impact the market values of assets and liabilities. These can negatively impact the tangible capital of the organization.  

Sage asset/liability management (ALM) requires being prepared for potential changes which could potentially impair a financial institution’s ability to thrive in a difficult interest rate environment, much like the one that we currently find ourselves.



Much attention is given to optionality in loans held and how it changes when interest rates change. Deposits have a high degree of optionality during periods of increasing interest rates and may not be the long-term funding originally assumed. Because of this, exclusively using deposits to fund long-term assets needs to be reviewed. A strategy of utilizing FHLBank Indianapolis term funding to complement core deposits to support longer-term assets, such as mortgages, is an effective approach.  

Be Prepared

Take these actions to ensure you have access to the liquidity you need, when you need it.

Providing Insurance Member Liquidity

Helping Insurers Stay Fully Invested

Investing profitably, while still having access to liquidity when needed, is an ongoing challenge for insurance companies. During periods of rising rates, optimal sources of liquidity do not come from security sales. Having access to reliable liquidity sources, the ability to pledge a variety of investment types, and staying fully invested is a benefit of having FHLBank membership. 

Why do insurers use FHLBank funding instead of selling securities?

Based on the current FHLBank Indianapolis Credit Policy, members have the ability to access funds by posting a wide variety of potential collateral. This allows access to liquidity without selling income-earning securities or selling at a loss.

Board of Directors Seats 2 New Members in Special Election

The Federal Home Loan Bank of Indianapolis is pleased to announce that two vacant seats on the Board of Directors (the “Board”) were filled during the Board’s recent 2023 special election.

Kathryn M. Dominguez, professor of public policy and economics at the University of Michigan in Ann Arbor, Mich., will serve as an independent director and fill an unexpired term beginning April 1, 2023, through Dec. 31, 2024. More information about Dominguez is available on the university’s website.

Kenneth Kelly, chairman of the board and CEO of First Independence Bank in Detroit, will serve as a member director representing Michigan and fill an unexpired term beginning April 1, 2023, through Dec. 31, 2023. More information about Kelly is available on the bank’s website.

In early June, the Board will announce open seats for the 2023 annual election. Additional information can be found on the Bank’s Become a Board Member page on fhlbi.com.



Board- and election-related questions can be directed to Lyndsay Miller, Assistant General Counsel & Corporate Secretary, at election@fhlbi.com.

FHLBank Indianapolis Corporate Social Responsibility Report

The Federal Home Loan Bank of Indianapolis has been supporting affordable housing throughout Indiana and Michigan and meeting the liquidity needs of our member financial institutions since 1932. As we continue to grow and meet these needs, our priorities have remained the same -- putting our members and serving their communities first. Our newly released 2022 Corporate Social Responsibility Report describes the many ways the Bank and our employees made a difference throughout our district and beyond. Click here to read the report.



FHLBank Indianapolis Adds MIchigan CDFI Member

On March 22, 2023, CORE Community Partners of Bingham Farms, Mich., purchased its initial stock to join the Bank, per the FHLBank Indianapolis Capital Plan.



CORE, which stands for Capital, Opportunity, Resources, Empowerment, is a non-profit, mission-driven organization focused on assisting communities and partners by providing cost-effective lending for predevelopment, construction and acquisition, as well as investing, consulting and other financial services.

“We are excited to welcome CORE Community Partners as a member CDFI focused on strengthening underserved Michigan communities through development and redevelopment of affordable housing,” said Michigan-based Jaime Carver, VP/Michigan Account Director for FHLBank Indianapolis.

With the addition of CORE, the Bank now has four CDFI members, three in Michigan and one in Indiana.

CORE is the second financial institution to join FHLBank Indianapolis in 2023. Compass Credit Union joined in February. FHLBank Indianapolis now totals 346 members in Indiana and Michigan.

Members list: Click here to view (as of Dec. 31, 2022).



2023 AHP Application Workshops| Register Now!

Looking to submit an application for the 2023 Competitive Affordable Housing Program (AHP) Round? Attend one of the upcoming virtual training sessions.

The training will focus on everything you need to know to prepare and submit an AHP application during the 2023 funding round, including completing the application, required supporting documentation, the member/sponsor relationship, scoring criteria, threshold requirements and monitoring requirements.

May 2, 2023, 10 a.m. - noon: AHP Application Virtual Workshop: Homeownership

May 4, 2023, 10 a.m. - noon: AHP Application Virtual Workshop: Rental