Loans from Federal Home Loan Banks: An opportunity for US insurers to enhance investment yield and total return

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Abigail Clare, Client Service Manager

The views expressed are those of the author at the time of writing. Other teams may hold different views and make different investment decisions. The value of your investment may become worth more or less than at the time of original investment. While any third-party data used is considered reliable, its accuracy is not guaranteed. For professional, institutional, or accredited investors only. 

Learn why we believe FHLB loans provide compelling potential for insurers to add alpha or increase yield by borrowing at low rates and benefitting from possible favorable treatment by ratings agencies. In addition, explore examples of customized investment solutions that have the potential to capitalize on these advantages.


  • Federal Home Loan Banks lend to insurers at very competitive rates, providing opportunities to add alpha or enhance yield by borrowing at low cost and investing in risk-appropriate markets.
  • Adding to its appeal, FHLB debt may receive favorable treatment as operating leverage by ratings agencies.
  • We provide examples of customized investment solutions that can enable insurers to capitalize on the advantages of FHLB borrowings, and we also note potential risks.
Wellington Management
Wellington Management

Insurers have been building investment partnerships with Wellington since 1975. Our goals since then have remained evergreen – to exceed the investment objectives and service expectations of our clients. As an integral part of Wellington’s global investment platform, our dedicated Financial Reserves team offers a breadth and depth of resources and experience to serve our insurance clients as a go-to thought partner, risk manager, and trusted advisor for complex investment challenges. Today’s unprecedented challenges require unconventional solutions, and our collaborative strategic and proactive risk management approach helps our clients to be well-prepared.

Rich Coffman
+1 617 951 5311

Sarah Marschok
+1 617 790 7170

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