---
title: "FHLB Advances: definition, formula, and thresholds"
description: "Federal Home Loan Bank (FHLB) Advances are collateralized loans from one of the 11 regional FHLBs to member banks. FHLB advances are the largest single source of wholesale funding for US community and regional banks."
canonical_url: https://www.bankregreports.com/glossary/fhlb-advances/
source: BankRegReports
category: "Liquidity & Balance Sheet"
units: "$"
schedule: "Schedule RC-M"
---

# FHLB Advances

> Federal Home Loan Bank (FHLB) Advances are collateralized loans from one of the 11 regional FHLBs to member banks. FHLB advances are the largest single source of wholesale funding for US community and regional banks.

## Formula

```
FHLB advances are reported on Call Report Schedule RC-M as part of total borrowings.
```

FHLB advances are issued against pledged collateral (primarily residential mortgages, commercial real estate, and securities) at terms from overnight to 30 years. The bank's borrowing capacity is governed by the value of pledged collateral, not the FHLB's appetite.

## Why it matters

FHLB system advances peaked above $1T in early 2023 as deposits fled to money market funds. The 'lender of last resort before the Fed discount window' framing has become standard. FHLB advances are the single largest wholesale funding source for community and regional banks.

## How to read it

FHLB advances under 5% of assets are routine. 5-15% indicates moderate wholesale reliance. Above 15% signals heavy dependence on collateralized borrowing. The concern is collateral sensitivity. An asset-value shock that shrinks pledged collateral can force advance paydown.

## Thresholds

| Range | Reading | What it means |
|---|---|---|
| < 5% of assets | Light | Modest wholesale funding share. |
| 5–15% | Moderate | Typical for many community banks. |
| 15–25% | Heavy | Significant collateralized-funding reliance. |
| > 25% | Concentrated | Vulnerable to collateral revaluation. |


## Worked example

A $4B community bank with $600M of FHLB advances against $4B of assets reports a 15% advance/assets ratio. The bank likely has $700-800M of unused FHLB capacity (collateral pledged but unused) and would disclose both outstanding and available capacity in earnings calls.

## Questions

### Why did FHLB advances surge in 2023?

Because deposits ran off to money market funds when short-term rates rose. Banks plugged the funding gap with FHLB advances, the cheapest collateralized wholesale source. Total system advances jumped roughly $400B in 6 months before stabilizing.

### Is FHLB funding stable?

Under NSFR, FHLB advances are weighted by remaining maturity. Long-term advances (>1 year) count more favorably than overnight. The collateral pledge is what makes the funding cheaper and faster than alternatives.

### Did SVB use FHLB advances?

Yes. Silicon Valley Bank borrowed approximately $30B from the San Francisco FHLB shortly before failure. The advances did not save the bank but did absorb collateral that would otherwise have been available to other creditors in resolution.

## Sources

- [FFIEC Call Report Schedule RC-M](https://www.ffiec.gov/sites/default/files/data/reporting-forms/FFIEC031_FFIEC041_202606_i.pdf) (PDF)
- Federal Housing Finance Agency FHLB system reports

## Related metrics

- [Total Borrowings](https://www.bankregreports.com/glossary/total-borrowings/): Total borrowings are a bank's wholesale, non-deposit funding: Federal Home Loan Bank advances, fed funds purchased, repurchase agreements, and subordinated debt. They supplement deposits but are costlier and more confidence-sensitive.
- [Uninsured Deposit Ratio](https://www.bankregreports.com/glossary/uninsured-deposit-ratio/): The Uninsured Deposit Ratio measures deposits above the $250K FDIC insurance threshold as a percentage of total deposits. Made infamous by the Silicon Valley Bank failure in 2023, it captures deposit base run-risk.
- [Net Stable Funding Ratio](https://www.bankregreports.com/glossary/net-stable-funding-ratio/): The Net Stable Funding Ratio (NSFR) measures whether a bank's long-term assets are matched by long-term funding sources. It is the structural complement to the 30-day Liquidity Coverage Ratio under Basel III.
- [Core Deposit Ratio](https://www.bankregreports.com/glossary/core-deposit-ratio/): The Core Deposit Ratio measures 'core' deposits (total deposits less time deposits over $250,000 and less brokered deposits of $250,000 or less) as a percentage of total deposits. Core deposits are the most stable, lowest-cost funding source available to a bank.

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