Member Spotlight

FHLBank Topeka's mission is to partner with our members to make a difference in communities throughout Colorado, Kansas, Nebraska and Oklahoma. Here are some examples of this partnership in action.

Speed and ease are top reasons to choose FHLBank’s overnight line of credit

Member Insights

 

Why they are Line of credit fans
One of the most prevalent reasons these members use the overnight line of credit is the speed and ease of drawing on their line. “It only takes a one-minute phone call each day to access the funds,” said Bryan VonFeldt. VonFeldt calls the FHLBank Lending Desk so much that he even has the number memorized. 
 

Speed isn’t the only consideration. A superior rate, especially when considering the above-market FHLBank dividend, is also a strong reason to use the overnight line of credit. Randy Pieper notes that the overnight line of credit is a significantly better rate than their two other sources of overnight funding. “We factor the dividend into our rate comparison, even though FHLBank beats other funders’ rates without the dividend,” said Pieper. Bryan VonFeldt agrees, “We know FHLBank is our cheapest funding source. Of course, the dividend makes it even better.”

Flexibility is also a key benefit of the overnight line of credit. No matter whether you are acting on loan opportunities, like Susie Lutz, or a swing in daily deposit balances, like Bryan VonFeldt, the overnight line of credit is flexible enough to fit your needs. Those interviewed said it was a bonus that the overnight line of credit doesn’t lock them in and allows them to pay down the next day, if needed. "I appreciate the fact I can pay our overnight line of credit balance down anytime and the late deadline [4 p.m. CT],” Lutz said. “It’s also great that we don’t have to do any paperwork when we draw on our line.” Bryan VonFeldt noted that the overnight line of credit balance doesn’t have to be paid to zero every day like some funding providers. 

Speaking of other providers, one of the members interviewed said they had signed up to use QwickRate, the deposit listing service. They found it was too cumbersome with the numerous steps involved in placing an order and came back to the overnight line of credit. 

Whether they are using securities or loans to collateralize their overnight line of credit, interviewed members were pleased with both options. “The fact that we can pledge loans keeps us from having to come up with extra securities for collateral, and that is a big deal,” said VonFeldt. Randy Pieper appreciates FHLBank’s third-party collateral agreement for securities. “Unlike other lenders, FHLBank typically doesn’t require collateral to be moved to them. Securities only have to be pledged,” Pieper explained.

 

The bottom line with any funding source is how it helps members more easily do business in their communities. “Access to our FHLBank overnight line of credit keeps our customers happy by allowing us to quickly act on loan opportunities as well as loan participations,” said Lutz.

To learn more about putting your FHLBank overnight line of credit to work for you, contact our Lending Desk at 
FHLB.Lending@fhlbtopeka.com or 800.809.2733. 

We can test your line for less than $1 and only a few minutes of your time. Our team will be happy to walk you through accessing your overnight line of credit for a real or test borrowing need. 

 

 

 

CREDIT UNION OF AMERICA

Wichita, Kansas

 
Credit Union of America serves both metro and rural communities across Kansas. Whether they are doing a home loan in Great Bend or Wichita, one thing is always the same: more money to work with means happier homebuyers. To help get qualified first-time homebuyers into the home of their dreams, Credit Union of America has used FHLBank Topeka’s Homeownership Set-aside Program (HSP) for several years. 
 
Ernest Warren, Credit Union of America’s chief lending officer, says the down payment assistance provided through a $5,000 HSP grant has two main benefits for their members.

“HSP can add to their budget to let them get more house for their money. Secondly, more money upfront makes a significant difference in the appreciation of their new home.”
 Warren and his lending team spread the word about HSP to their borrowers through onsite promotions, during their initial loan interview and at their annual first-time homebuyer event. He also says that HSP Online made the process more responsive and intuitive. He also likes the $25,000 monthly member limit instituted a few years ago. He credits that change with “leveling the playing field” and giving more FHLBank members access to the grant funds.
 
The 2019 HSP round opened on March 4 with approximately $6.6 million in funds available. To learn more about how you can participate, visit our HSP page. 

 

 

TTCU

Tulsa, Okla.

 
About seven years ago, Shelby Beil, VP, CFO and Technology Officer at TTCU Federal Credit Union came to the realization that they weren’t serving their member’s mortgage needs as well as they could. “We were holding all mortgages in portfolio and, as a result, limiting our mortgage production in order to manage interest rate risk,” Shelby said.
 
TTCU conducted an in-depth analysis into how to better meet their members’ mortgage needs. “The FHLBank MPF^® Program was far and away the best option,” Shelby said. The MPF Program – short for Mortgage Partnership Finance^® Program – is a conduit into the secondary market available through FHLBank Topeka. TTCU sells both conventional fixed-rate and government mortgages. 

Compelling pricing was one reason TTCU chose the MPF Program. “The pricing has been consistently better than other options, plus we don’t get dinged by loan-level price adjustments,” Shelby said. Sharing in the credit risk was also attractive to TTCU. “We felt good about the credit quality of our loans and appreciate the credit enhancement income we receive,” Shelby added. While each participating financial institution manages the credit risk, FHLBank manages the liquidity, interest rate and prepayment risks of the loans.

The MPF Program offers participating financial institutions the choice of keeping the servicing or selling it. TTCU chose to retain their servicing. “There is a level of comfort in knowing FHLBank Topeka is the last destination for our mortgage loans,” said Shelby.

Perhaps the most attractive part of the MPF Program to TTCU is the customer service they receive. “MPF is more of a partnership than other secondary market options,” Shelby said. “You have someone working with you every step of the way, and FHLBank is very open to feedback. We have a voice into features and improvements we’d like to see.” The MPF Program stays on top of trends in mortgage lending and responds with products that help participating credit unions to better serve their market. 
 

TTCU is one of many FHLBank members who has expanded its mortgage business with help from the MPF Program. Visit our MPF site at www.fhlbtopeka.com/mpf to learn how you can get started.
 

 

The First State Bank

Oklahoma City, Okla.

 

The First State Bank has been using FHLBank Topeka’s Homeownership Set-aside Program (HSP) for many years to help first-time homebuyers in their community realize their dream of homeownership.
 

“The HSP is huge for us,” said Robert Fightmaster, president of The First State Bank’s mortgage lending area. “It’s a big competitive advantage for our mortgage area. Without the HSP, we wouldn’t have grown as we have.”
The First State Bank uses the HSP to their advantage by starting to market it in early January. Fightmaster sees the grants as a great way to build relationships with local realtors and homebuilders. The $25,000 monthly member limit on HSP funds lends urgency to their marketing efforts by encouraging potential homebuyers to act quickly since The First State Bank (or any FHLBank member) only has access to up to $25,000 per month. 

One of the new homeowners The First State Bank secured an HSP grant for last year is a local teacher. “Her parents had offered to help her with the purchase, but she wanted to do it on her own,” Fightmaster recalled. The HSP helped this young professional afford her new home and still have enough of her own money left to purchase furnishings to make it a home. 

Last year’s launch of HSP Online made the program more attractive to even a long-time HSP participant, like The First State Bank. “The new system is much faster than before,” said Fightmaster. “The staff in FHLBank’s housing area is also very responsive to our questions.”

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InterBank

Oklahoma City, Okla.

 

InterBank of Oklahoma City has a passion for education.

 

Staff members volunteer in schools throughout Oklahoma and Texas to better the future, one toy at a time.

 

“We have coloring books and piggy banks and we talk to kids about saving money,” said Banking Officer Paul Navarro, who oversees the institution’s community service efforts. “We’ve had 100% participation (by our branches), and it makes a difference. We’re really reaching the students.”

 

InterBank’s “How Money Works” program targets first- through third-graders to learn the basics of finance including the functions of a bank, wants vs. needs and how money is made. Other smaller programs for older students focus on advanced concepts like mortgage payments and living on a budget.

 

While volunteers work with students in the classroom, InterBank is also able to support local schools in a more fiscal manner. Public entities, such as school districts and municipalities, look to InterBank to help protect deposited funds.

 

It’s a service made easier by InterBank’s partnership with FHLBank Topeka.

 

“We use FHLBank’s Letters of Credit as collateral for public entities’ deposits,” said InterBank Senior Vice President and CFO Stephanie Craig. “Public entities are comfortable with Letters of Credit for collateral, and it makes it easier to attract new public unit deposits.”

In order to get public entities to the Letters of Credit comfort zone, InterBank took a cue from their own volunteers and went out into the world in the name of financial education. Staff visited public entities in small towns to explain the benefits of Letters of Credit, including the ease, flexibility and absence of necessary monitoring.

 

The product, Craig said, was an easy sell.

 

“It’s a Letter of Credit, so public entities don’t have to worry about the value of the collateral going up and down. With securities, you do,” Craig explained. “We don’t have to give them a report every month. They always know how much money they have in the account and that their deposits are covered.”

 

After a recent overhaul to the system, FHLBank Topeka’s Letters of Credit now have even more benefits to add to the list. The new Letters of Credit are completely electronic, are issued instantly and members like InterBank have on-demand access to documentation online.

 

“We have been able to give our customers an even quicker turn around then before,” Craig said. “Record keeping is also greatly reduced.”

 

Armed with a faster system, Craig said her institution aims to expand its public funds business, using Letters of Credit to help bring in new deposits. InterBank has a similar goal in terms of community service, as the company plans to grow its volunteer efforts throughout Oklahoma and Texas schools.

 

Just like InterBank staff worked closely with public entities to familiarize them with Letters of Credit, InterBank volunteers hope to make kids more comfortable with banks.

 

“If we can take that intimidation factor out of it, if we can reach these kids when they’re young, they can learn to trust banks and know their money is better off,” Navarro said. “They won’t grow up to be a credit invisible. They’ll be smarter and better about money.”

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Aventa Credit Union

Colorado Springs, Colo.

 

Serving the mortgage lending needs of the nine counties in their market wasn’t possible for Aventa Credit Union before they started using the Mortgage Partnership Finance^™ (MPF™) Program.

 

“The MPF Program puts us on a level playing field with larger credit unions. It lets us act like a larger financial institution and adequately manage our interest rate risk and our members’ credit risk,” said Greg Mills, president and CEO of Aventa Credit Union

 

Prior to their relationship with FHLBank’s MPF Program, the $170 million credit union could only offer second mortgages and HELOCs. “We were having to turn away our members when they needed a first mortgage,” added Greg.

 

Aventa, which is headquartered in Colorado Springs, Colo., also serves the Front Range and San Luis Valley. “Participating in the MPF Program allows us to serve our entire market. Selling our conforming loans into the MPF Program frees up our capital to take on nonconforming properties and give our members what they need,” said Sandra Wells, SVP of Lending for Aventa.

 

Aventa sees several benefits of using the MPF Program, including the added income stream for the Credit Enhancement fee income and retaining the servicing of the mortgages. They also found some less tangible advantages. “FHLBank Topeka offers incredible service,” noted Sandra. “Someone always answers the phone or calls back quickly. FHLBank sees each member as an individual and finds what’s best for their situation.”;

 

Aventa Credit Union recently was interviewed for a video celebrating the MPF Program’s 20th Anniversary. You can find that video and more about the MPF Program on our website.

 

“Mortgage Partnership Finance” and “MPF” are registered trademarks of the Federal Home Loan Bank of Chicago.

 

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CrossFirst Bank

Leawood, Kan.

 

The first goal was always trust.

 

It was 2007, and a group of business leaders from Kansas City envisioned a bank built around trust. After raising more than twice the typical capital needed to open a new financial institution, CrossPoint Bank was born.

 

Ten years later, CrossFirst has been through countless changes – including a new name -- billions in growth and an expansion across multiple Midwest states. But trust remains at its core.

 

“CrossFirst Bank’s vision is to be the most trusted bank in the five markets it serves,” said Mike Tomandl, Chief Management Accounting Officer. “CrossFirst wants to offer extraordinary service to businesses and professionals and provide competitive returns to its investors.”

 

To help achieve such aspirations, the Leawood, Kan.,-based institution put their trust in FHLBank Topeka. Becoming a member in 2008, CrossFirst looks to FHLBank as a partner for fixed-rate wholesale funding opportunities.

 

“We primarily use FHLBank fixed rate bullet advances, but have also utilized amortizing and convertibles as part of our strategic plan,” Tomandl explained. “This type of funding allows us to extend certain assets for income generation and helps mitigate interest rate risk.”

 

The income generated helped CrossFirst grow its assets to more than $2 billion in its short decade of existence. The growth allowed the bank to expand beyond the boundaries of Kansas City into Wichita, Oklahoma City, Tulsa and most recently Dallas.

 

CrossFirst has also sought to reach the needs of a growing customer base by offering new products for a wider range of industries. In 2014, they developed an energy lending group and an international banking group to complement their suite of services for business professionals.

 

And an FHLBank Topeka advance allowed them to serve customers in higher education.

 

“CrossFirst has utilized a 10-year amortizing advance to match fund a 10-year loan commitment,” Tomandl said. “The loan was used to fund the acquisition of a building for a for-profit college. We still have the advance on our books.”

 

With a long-term partnership in the works, Tomandl said his bank will continue to trust FHLBank Topeka as a steady source for fixed rate wholesale funding, especially as they aim for further expansion over their next 10 years.

 

“It’s a very robust growth plan with trust at the center,” Tomandl said. “And FHLBank advances will continue to complement that growth.”

 

CrossFirst expects to grow at a double-digit rate in each of its five markets, he said. It’s a benchmark the bank will achieve with trust not only as its first goal but as a forever goal for success.

 

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