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Collateral Services

A member’s credit rating and FHLB Dallas' risk analysis determine whether a member may borrow under a blanket lien status or custody status. Members accorded blanket collateral status may borrow up to a specified percentage of the book value of eligible collateral without specifically listing, segregating or delivering collateral to FHLB Dallas.

Blanket Lien Status

  • The member meets all statutory and regulatory capital standards
  • The member is assigned a credit rating of A, B or C
  • The member meets all of FHLB Dallas' credit-underwriting standards
  • Custody status requires the delivery of qualifying collateral to secure existing or future extensions of credit. This collateral may be eligible loans or securities, or the member may purchase a CD from FHLB Dallas.

Custody Status

  • The member is an Insurance Company, Housing Associate, Community Development Financial Institution (CDFI) or is assigned Custody status at the member's request.
  • The member does not meet all statutory or regulatory capital standards.
  • The member is assigned a credit rating of D, E or E*.
  • The financial condition or controls of a member are such that FHLB Dallas would be secure only if collateral is in the possession of FHLB Dallas, and its interests are fully protected.
  • The member otherwise fails to meet FHLB Dallas' underwriting standards for the Blanket Lien.
  • Members who have a Specific Loan Collateral Status, who may elect to borrow under a specific collateral-only lien arrangement.

Thorough Collateral Verifications

  • Members with blanket lien status are subject to collateral verification reviews. Collateral reviews establish a member's loan eligibility percentage and document exception rates.
  • Collateral verifications are conducted as desktop reviews and onsite reviews. The frequency and type of collateral review is based on each member's average daily borrowings that utilize their blanket lien within the previous calendar year. All collateral reviews are conducted by Collateral Services department staff.
  • Desktop reviews require member submission of an electronic loan data report through SecureConnect.
  • Onsite reviews require member submission of an electronic loan report through SecureConnect, followed by an examination of randomly selected sample loans in an onsite visit.

More information on delivering loans is found in Collateral Vault Operations.