§4613 Critical capital levels

Summary

Requires each enterprise to compute a "critical capital level" by adding three parts. First, 1.25 percent of its on‑balance‑sheet assets, using generally accepted accounting rules. Second, 0.25 percent of the unpaid principal on outstanding mortgage‑backed securities and similar instruments not already counted. Third, 0.25 percent of other off‑balance‑sheet obligations not in part two, excluding commitments that exceed 50 percent of the average quarterly commitments over the prior four quarters. The Director may change that third percentage to reflect different credit risk. The Director must set the critical capital level for each Federal Home Loan Bank by regulation, using the enterprise formula as a guide and adjusting it to fit the banks’ different operations.