Fitch Affirms Several Federal Home Loan Banks' 'AAA' Rating and Stable Outlook

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NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed the 'AAA' long-term Issuer Default Ratings (IDRs) and Support Floors of the Federal Home Loan Banks (FHLBs) of Atlanta, Boston, San Francisco, and Seattle. The Rating Outlook remains Stable. This action follows Fitch's affirmation earlier today of the 'AAA' IDR and Stable Rating Outlook on the U.S. Government. A full list of ratings follows at the end of this release.

As government sponsored enterprises, the ratings of the FHLBs are linked to the U.S. Sovereign rating. This is articulated in Fitch's Special Report titled 'Rating Linkages to the U.S. Sovereign Rating' dated July 18, 2011. The FHLBs have historically benefited from their affiliation with the U.S. government, and their current ratings benefit from the implicit support that they receive.

The Federal Home Loan Banks System (FHLBank System, or the System) was created by Congress in 1932 and falls under the authority of the FHLBank Act. The Government Sponsored Enterprise (GSE) is comprised of 12 district banks, each serving a designated geographic area of the United States.

The System's mission is to provide a reliable source of liquidity to financial institutions which, in turn, is used to originate mortgage loans. Through the Office of Finance, the System issues consolidated obligations to investors globally. The consolidated obligations are jointly and severally liable between the 12 district banks.

The rating actions were driven by the specific event of the affirmation of the U.S. sovereign rating on Aug. 16, 2011. Fitch did not carry out a full review as described in its 'Global Financial Institutions Rating Criteria', but limited its review to an assessment of the impact of the event on the banks' ratings.

The ratings of FHLB of Atlanta were last reviewed on Feb. 11, 2011; see the Fitch release, 'Fitch Affirms Federal Home Loan Bank of Atlanta at 'AAA/F1+'; Outlook Stable, dated Feb. 11, 2011. The ratings of both FHLB of Boston and FHLB of San Francisco were last reviewed on March 9, 2011; see the Fitch releases, 'Fitch Assigns 'AAA' Rating to Federal Home Loan Bank of Boston' and 'Fitch Assigns 'AAA' Rating to Federal Home Loan Bank of San Francisco', dated Mar. 9, 2011. The FHLB of Seattle was last reviewed on April 7, 2011; see the Fitch release, 'Fitch Assigns 'AAA' Rating to Federal Home Loan Bank of Seattle', dated April 7, 2011. These releases are available at 'www.fitchratings.com':

The following ratings have been affirmed with a Stable Rating Outlook:

Federal Home Loan Bank of Atlanta

--Long-term IDR at 'AAA';

--Short-term IDR at 'F1+';

--Support at '1';

--Support Floor at 'AAA';

--Individual Rating at 'C';

--Viability Rating at 'bbb+'.

Federal Home Loan Bank of Boston

--Long-term IDR at 'AAA';

--Short-term IDR at 'F1+';

--Support at '1';

--Support Floor at 'AAA';

--Individual Rating at 'C';

--Viability Rating at 'bbb+'.

Federal Home Loan Bank of San Francisco

--Long-term IDR at 'AAA';

--Short-term IDR at 'F1+';

--Support at '1';

--Support Floor at 'AAA';

--Individual Rating at 'B/C';

--Viability Rating at 'a-'.

Federal Home Loan Bank of Seattle

--Long-term IDR at 'AAA';

--Short-term IDR at 'F1+';

--Support at '1';

--Support Floor at 'AAA';

--Individual Rating at 'C/D';

--Viability Rating at 'bbb-'.

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research:

--'Global Financial Institutions Rating Criteria' (Aug. 16, 2010);

--'Short-Term Ratings for Corporate Finance' (Nov. 2, 2010);

--'Rating Criteria for Banking Structures Backed by Mutual Support Mechanisms' (Apr. 11, 2011)

--'Rating Linkages to the U.S. Sovereign Rating' (July 18, 2011)

--'Fitch Affirms United States at 'AAA'; Outlook Stable' (Aug. 16, 2011).

Applicable Criteria and Related Research:

Global Financial Institutions Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=547685

Short-Term Ratings Criteria for Corporate Finance

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=568726

Rating Criteria for Banking Structures Backed by Mutual Support Mechanisms

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=591785

Rating Linkages to the U.S. Sovereign Rating

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646469

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