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Bulletin No.: 2015-26
September 21, 2015


SUBJECT: Special Advances Offering with Reduced Capital Stock Requirement and Updated Dividend Target Ranges

The Federal Home Loan Bank of Dallas (Bank) is pleased to announce that our Board of Directors (Board) has authorized the Bank to reduce the activity-based capital stock investment requirement from 4.1 percent to 2 percent for certain advances that are funded during the period from October 21, 2015 through December 31, 2015. Terms of this special advances offering are as follows:

  • Advances with a minimum maturity of one year or greater are eligible for the reduced activity-based investment requirement;
  • Advances funded must increase your institution’s outstanding advances balance above its October 20, 2015 balance, less any advances balances that are scheduled to mature during the period from October 21 through December 31; and
  • The total advances offering is $8 billion. Of this total offering, $2 billion is reserved through December 1 for members whose total assets fall below the three-year average asset cap for community financial institutions, defined for 2015 as average total assets for year-ends 2012, 2013 and 2014 of $1.123 billion.

The standard capital stock investment requirement of 4.1 percent continues to apply to all other advances. All other minimum investment requirements also continue to apply.

This special offering is made possible by recent amendments to the Bank's Capital Plan that were announced in an August 31 member bulletin and that will take effect October 1, 2015. As previously announced, on that date your shares of existing Class B capital stock will be exchanged for shares of two new sub-classes of stock. Class B-1 stock will represent your membership investment requirement and any excess stock, and Class B-2 stock will represent your activity-based stock. In addition, the Capital Plan amendments authorize the Bank’s Board to reduce the activity-based stock requirement for specifically designated advances, such as the offering described above, to as low as 2 percent.

In addition, the amended Capital Plan authorizes the Board to declare dividends at different rates for the two sub-classes of stock. This will allow (but not require) the Bank to pay higher dividends on activity-based capital stock, which would reward members for using the Bank’s advances.

In conjunction with the implementation of these changes to the Bank’s Capital Plan, the Board recently adopted new dividend target ranges for the two sub-classes of stock. While there can be no assurances about future dividends or future dividend rates, the target for quarterly dividends on Class B-1 stock will be an annualized rate that approximates the average one-month LIBOR rate for the dividend period, with the expectation that dividend rates on Class B-1 stock would not be lower than the recent annualized rate of 0.375 percent on existing Class B shares. The target range for quarterly dividends on Class B-2 stock will be an annualized rate that approximates the average one-month LIBOR rate for the dividend period plus 0.5 – 1.0 percent. The first dividend that will be considered in light of these new target ranges will be the dividend that the Board considers paying in the first quarter of 2016.

The recent changes to the Bank’s Capital Plan, and the special advances offering and increased dividend targets announced in this bulletin, are intended to increase the value of your institution’s membership in the Bank. To learn more about this special advances offering and the Capital Plan changes, please register for a member webinar that will take place at 3:00 p.m. CT on October 13. You may register on

For additional information on the Capital Plan changes and the upcoming special advances offering described above, please visit the Membership section of and click Capital Plan. There you will find links to the Capital Plan, the Capital Plan Summary, the enclosed Frequently Asked Questions, and a short informational video. As always, please contact our Member Services Desk with questions at 844.FHL.BANK.

Thank you for being a valued member.


Sanjay K. Bhasin
President and Chief Executive Officer