It is hard for me to believe that we are in the fifth month of the COVID-19 pandemic. On March 14, when FHLBank Topeka made the decision to move the vast majority of our employees to work from home, I can say that I didn’t know how it would work. But I did know that it could work, because of the FHLBank team’s creativity, work ethic and commitment to our members. I am very proud of the success and speed by which our employees made the transition smoothly and securely with no disruption of services to our members. I am sure you have had similar proud moments as your teams worked together to serve your customers and your communities.
And now, in early August, we begin the process of returning our staff to FHLBank’s offices. We are doing this carefully and strategically. We are following CDC and WHO protocols, such as ensuring the building is safe and clean, taking temperatures and practicing social distancing. We are staggering the number of people returning to give us time to evaluate the situation. It is anticipated to have nearly all of our 200+ business partners working in our headquarters by year end. Yet, as you know, we have to be flexible as each day seems to bring another change and challenge.
The purpose of this message is to share non-financial events that have transpired at your cooperative in the second quarter. We will be filing our Form 10-Q with the Securities and Exchange Commission on Tuesday, Aug. 11, 2020. You can find the July 29, 2020, operating results here.
Pandemic Support
In May, I wrote to you about our temporary COVID-19 relief advances. We offered no- to low-cost advance funding to members through the end of June to help you support your communities during the pandemic. A total of 215 members took advantage of the program with more than $1 billion in funding drawn. Funds were distributed to members in Grand Junction, Colo., McPherson, Kan., Columbus, Neb., Oklahoma City, Okla., and everywhere in between and beyond in our four-state district. Many commented that the funds greatly helped their customers and communities at large.
We also reassessed our corporate giving program to direct funds to organizations who have been meeting the most urgent needs during the pandemic. We know many people are suffering at this time, not just financially, but with the mental and physical toll the virus can take when it strikes a family. We’ve reshuffled our charitable giving funds to help with items such as PPE for medical staff, food banks for those struggling financially and small business support. I assume that, like us, many of you are doing the same for your communities. We know that our members are pillars in their communities and are proud of our association with such community-minded organizations.
Educational Opportunities and Other Ways We Can Help
This past Monday and Tuesday I had the privilege to sit in on a virtual meeting with members of our Member Advisory Group. This group, which is comprised of 16 members across our district, was created last year to help us gain greater insight on challenges our members face.
It was refreshing to talk to members from all four states and hear how they are meeting the needs of their customers and managing their institutions during this uncertain time. The frustration of having too much liquidity surfaced a number of times in our discussions. We understand that many of you do not currently need advances. This is a time for us to listen even more closely to what you are facing in your business and community and look for other ways we may be able to assist our members. We can provide tools and funding solution suggestions. Then, when the time is right, you will be equipped with strategic approaches to your wholesale funding needs.
We are offering several complimentary educational webinars in the upcoming months that you may find helpful as you navigate 2020 into 2021. Topics range from liquidity management to collateral capacity. You can register for any or all of the webinars on our website. We also will be announcing details for a virtual regional meeting later this fall. Watch for more on that as our agenda develops.
- The Ins and Outs of Advances | Aug. 25 or 26
- Developing a Marginal Cost of Funds Strategy | Oct. 6 or 7
- Analyzing Your Liquidity | Nov. 17 or 18
- Identifying Hidden Collateral | Dec. 16
New Regional Account Manager
I am pleased to announce we recently hired Rusty Davis as our new Colorado, western Kansas and western Nebraska regional account manager. Rusty has worked in the financial services sector since 1989. He has spent most of his career serving as a trusted advisor to financial institutions. He is a graduate of Bethel University, McKenzie, Tenn., and the Louisiana State University Graduate School of Banking. Rusty lives in Highlands Ranch, Colo. You can contact him at rusty.davis@fhlbtopeka.com or 720.212.9873. Watch for a more formal introduction to Rusty for those of you in his region.
Rusty joins the other three regional account managers:
- Jeff Steiner, who serves most of Kansas;
- Mark Woita, who works with central and eastern Nebraska and northeast Kansas; and
- Trent Meyer, who serves Oklahoma members.
To ensure the health of our members and our employees, we have decided to limit business travel until at least Sept. 30. We appreciate your willingness to visit with the regional account managers and collateral analysts virtually. Though it can feel less personal, we have found these meetings to be effective and efficient. We are evaluating the benefits of continuing virtual meetings as an option post-pandemic.
Affordable Housing Program Open
Ten percent of our earnings each year funds our Affordable Housing Program (AHP). We have dedicated $13.3 million in 2020 to assist housing-related nonprofit organizations, who work in partnership with our members.
We are currently accepting applications for these competitive AHP grants. To find out more about AHP, please check out our AHP page. You can also read about a Denver AHP housing complex that includes a homeless shelter, supportive housing and affordable housing.
For questions about submitting a 2020 AHP application, contact the Housing and Community Development department at 866.571.8155. Technical assistance will be available until the round closes on Friday, Aug. 21, 2020
Member Experience Research
In February 2020, FHLBank concluded an extensive research project regarding what it is like to conduct business with us. The results of the qualitative and quantitative research were overall very positive, specifically in our ratings for customer service, trustworthiness and responsiveness. The research also showed areas where we can improve. We currently are determining short- and long-term action items that will have the greatest impact on the member experience. I look forward to sharing with you the improvements made based on member input and involvement.
MPF Stock Requirement
On July 24, 2020, we sent a message regarding a new stock requirement related to the Mortgage Partnership Finance® (MPF®) Program. In order to support the future growth of the popular program, we implemented a 3% MPF stock requirement beginning Aug. 5, 2020.
In addition to the reduction in advance rates recognized through your dividend, MPF participants will see additional income related to their MPF loan balances held by the FHLBank as a result of this change. We know this requirement impacts our members very differently, so please reach out to MPF Account Manager Chris Endicott if you have any questions.
New Independent Director
I am pleased to announce that Jeffrey R. Noordhoek has been elected to FHLBank’s board of directors as an independent director as of July 1, 2020. Mr. Noordhoek is chief executive officer at Nelnet, Inc., Lincoln, Neb. Mr. Noordhoek was elected to serve the remainder of the directorship made vacant by the death of Independent Director Andrew C. Hove, Jr.
Our 2020 director elections are ongoing and continue to be conducted online. I encourage you to make your voice heard by participating in this year’s election in your state.
I want to thank you for your membership in FHLBank Topeka. We value and respect the important role you play in keeping communities alive and thriving, especially during challenging times like these. I look forward to the days when we can gather again, but for now ensuring the health and well-being of our members and our employees remains our highest priority.
Thank you for your business and your partnership.
Mark Yardley | President and CEO
“Mortgage Partnership Finance” and “MPF” are registered trademarks of the Federal Home Loan Bank of Chicago.
