Transactions with Shareholders

12 Months Ended

Dec. 31, 2019

Transactions with Shareholders [Abstract]

Transactions with Shareholders [Text Block]

Transactions with Shareholders

We are a cooperative whose members own our capital stock and may receive dividends on their investment in our capital stock. In addition, certain former members and nonmembers that still have outstanding transactions with us are also required to maintain their investment in our capital stock until the transactions mature or are paid off. All advances are issued to members or housing associates, and mortgage loans held for portfolio are generally acquired from our members or housing associates. We also maintain demand-deposit accounts for members and housing associates primarily to facilitate settlement activities that are directly related to advances, mortgage-loan purchases, and other transactions between us and the member or housing associate. In instances where the member has an officer or director who serves as a director of the Bank, those transactions are subject to the same eligibility and credit criteria, as well as the same terms and conditions, as transactions with all other members.

Related Parties. We define related parties as members who owned 10 percent or more of the voting interests of our capital stock outstanding at year end. Each member eligible to vote is entitled to cast by ballot one vote for each share of stock that it was required to hold as of the record date, which is December 31, of the year prior to each election, subject to the limitation that no member may cast more votes than the average number of shares of our stock that is required to be held by all members located in such member's state. Under the FHLBank Act and FHFA regulations, each member directorship is designated to one of the six states in our district. Eligible members are permitted to vote all their eligible shares for one candidate for each open member directorship in the state in which the member is located and for each open independent directorship. A nonmember stockholder is not entitled to cast votes for the election of directors unless it was a member as of the record date. At December 31, 2019 and 2018, no shareholder owned more than 10 percent of the total voting interests due to statutory limits on members' voting rights, therefore, we did not have any related parties.

Shareholder Concentrations. We consider shareholder concentrations as members or nonmembers whose capital stock holdings (including mandatorily redeemable capital stock) are in excess of 10 percent of total capital stock outstanding at December 31, 2019.

Table 21.1 - Shareholder Concentrations, Balance Sheet (dollars in thousands)
	Capital Stock Outstanding		Percent of Total Capital Stock		Par Value of Advances		Percent of Total Par Value of Advances		Total Accrued Interest Receivable		Percent of Total Accrued Interest Receivable on Advances
As of December 31, 2019
Citizens Bank, N.A.	$	222,684	11.9	%	$	5,005,773	14.5	%	$	1,678	3.5	%
As of December 31, 2018
Citizens Bank, N.A.	$	339,003	13.2	%	$	7,656,146	17.7	%	$	5,005	8.3	%

We held sufficient collateral to support the advances to the above institution such that we do not expect to incur any credit losses on these advances.

Table 21.2 - Shareholder Concentrations, Income Statement (dollars in thousands)
	For the Year Ended December 31,
	2019		2018		2017
Citizens Bank, N.A.
Interest income on advances	$	95,692	$	134,753	$	63,568
Fees on letters of credit	6,489		4,415		3,368

During 2019 and 2017, we did not receive any prepayment fees from Citizens Bank, N.A. We received prepayment fees of $298,000 from Citizens Bank, N.A. and the corresponding principal amount prepaid to us was $3.2 million during 2018.

Transactions with Directors' Institutions. We provide, in the ordinary course of business, products and services to members whose officers or directors serve on our board of directors. In accordance with FHFA regulations, transactions with directors' institutions are conducted on the same terms as those with any other member.

Table 21.3 - Transactions with Directors' Institutions (dollars in thousands)
	Capital Stock Outstanding		Percent of Total Capital Stock		Par Value of Advances		Percent of Total Par Value of Advances		Total Accrued Interest Receivable		Percent of Total Accrued Interest Receivable on Advances
As of December 31, 2019	$	112,811	6.0	%	$	2,224,141	6.4	%	$	3,581	7.4	%
As of December 31, 2018	113,337		4.4		2,147,602		5.0		3,576		6.0