8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 25, 2006

FEDERAL HOME LOAN BANK OF SAN FRANCISCO
(Exact name of registrant as specified in its charter)

Federally chartered corporation	000-51398	94-6000630
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS EmployerIdentification No.)

600 California Street
San Francisco, CA 94108
(Address of principal executive offices, including zip code)

(415) 616-1000
(Registrant's telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[]Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

      On October 25, 2006, the Federal Home Loan Bank of San Francisco issued a press release announcing its financial results for the fiscal quarter ended September 30, 2006. A copy of the press release is included as Exhibit 99.1 to this report. The information contained in Exhibit 99.1 is being furnished pursuant to Item 2.02 of this Current Report on Form 8-K and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits

(c)	Exhibits
	99.1	Press Release, dated October 25, 2006, issued by the Federal Home Loan Bank of San Francisco

Signature(s)

       Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Federal Home Loan Bank of San Francisco
Date:  October 26, 2006	By:               /s/ Steven T. Honda
	Steven T. Honda        Senior Vice President and Chief Financial Officer

Exhibit Index

Exhibit No.	Description
99.1	Press Release, dated October 25, 2006, issued by the Federal Home Loan Bank of San Francisco

EX-99.1

Exhibit 99.1

October 25, 2006

Federal Home Loan Bank of San Francisco Reports Third Quarter Operating Results

San Francisco -- The Federal Home Loan Bank of San Francisco today announced that its net income for the third quarter of 2006 was $140 million, compared to $91 million for the third quarter of 2005. For the first nine months of 2006, the Bank's net income was $387 million, compared to $259 million for the first nine months of 2005.

Net interest income increased $39 million, or 22%, to $217 million for the third quarter of 2006 from $178 million for the third quarter of 2005. Net interest income increased $115 million, or 23%, to $611 million for the first nine months of 2006, from $496 million for the first nine months of 2005. The increases in net interest income were driven primarily by the effect of higher interest rates on higher average capital balances, combined with higher average interest-earning assets outstanding.

The net effect of fair value adjustments on trading securities, derivatives, and hedged items, after assessments, resulted in a net fair value gain of $3 million in the third quarter of 2006 compared to a net fair value loss of $19 million in the third quarter of 2005. Most of the net fair value gain in the third quarter of 2006 and the net fair value loss in the third quarter of 2005 reflected unrealized fair value adjustments.

The net effect of fair value adjustments on trading securities, derivatives, and hedged items, after assessments, resulted in a net fair value gain of $2 million in the first nine months of 2006 compared to a net fair value loss of $39 million in the first nine months of 2005. Most of the $2 million net fair value gain in the first nine months of 2006 reflected net fair value gains on the termination of hedges related to consolidated obligations. Most of the $39 million net fair value loss in the first nine months of 2005 reflected unrealized fair value adjustments.

Nearly all of the Bank's derivatives and hedged instruments are held to the maturity, call, or put date. For these derivatives and hedged items, net unrealized fair value gains or losses are primarily a matter of timing and will generally reverse over the remaining contractual terms to maturity or by the exercised call or put dates. As of September 30, 2006, the cumulative effect of SFAS 133 was a net unrealized gain of $28 million.

During the first nine months of 2006, advances outstanding grew $11.6 billion, or 7%, from $162.9 billion to $174.5 billion. In total, 165 institutions increased their advance borrowings during the first nine months of 2006, while 86 institutions decreased their advance borrowings.

Total assets grew $8.1 billion, or 4%, during the first nine months of 2006, from $223.6 billion to $231.7 billion. In addition to the growth in advances, interest-bearing deposits in banks grew $5.7 billion, or 82%, from $6.9 billion to $12.6 billion. In contrast, Federal funds sold decreased $8.4 billion, or 49%, from $17.0 billion to $8.6 billion.

The dividend rate for the third quarter of 2006 is 5.54% (annualized), up from 4.58% for the third quarter of 2005. The Bank plans to pay the dividend in the form of capital stock on October 27, 2006. The Bank's annualized dividend rate for the first nine months of 2006 is 5.27%, compared to 4.35% for the first nine months of 2005. The increases in the dividend rate reflect a higher yield on invested capital, partially offset by higher REFCORP and AHP assessments and a lower net interest spread on the Bank's mortgage loan and mortgage-backed securities portfolio during the third quarter of 2006 and the first nine months of 2006 compared to the same periods in 2005.

Financial Highlights
(Unaudited)

(Dollars in millions)	Sept. 30,       2006	Dec. 31,       2005	Percent Change
Selected Balance Sheet   Items at Period End
Total Assets	$231,719	$223,602	4	%
Advances	174,538	162,873	7
Mortgage Loans	4,775	5,214	(8	)
Held-to-Maturity Securities	29,824	29,691	--
Interest-Bearing Deposits
in Banks	12,568	6,899	82
Federal Funds Sold	8,600	16,997	(49	)
Consolidated Obligations:
Bonds	197,711	182,625	8
Discount Notes	19,653	27,618	(29	)
Capital Stock -- Class B --
Putable	10,301	9,520	8
Total Capital	10,437	9,648	8

	Three Months Ended					Nine Months Ended
	Sept. 30,       2006		Sept. 30,       2005		Percent Change			Sept. 30,       2006		Sept. 30,       2005		Percent Change
Operating Results
Net Interest Income	$217		$178		22		%	$611		$496		23	%
Other (Loss)/Income	(3	)	(35	)	(91		)	(19	)	(85	)	(78	)
Other Expense	23		19		21			65		58		12
Assessments	51		33		55			140		94		49
Net Income	$140		$91		54		%	$387		$259		49	%
Other Data
Net Interest Margin	0.38	%	0.34	%	12		%	0.36	%	0.34	%	6	%
Operating Expenses as a
Percent of Average Assets	0.03		0.03		--			0.03		0.03		--
Return on Assets	0.24		0.17		41			0.23		0.17		35
Return on Equity	5.59		4.03		39			5.23		4.05		29
Annualized Dividend Rate	5.54		4.58		21			5.27		4.35		21
Dividend Payout Ratio1	97.54		111.38		(12		)	98.76		105.24		(6	)
Capital to Assets Ratio2	4.55		4.34		5			4.55		4.34		5
Duration Gap (in months)3	1		1		--			1		1		--

1     This ratio is calculated as dividends declared per share divided by net income per share.
²     This ratio is based on regulatory capital, which includes mandatorily redeemable capital stock that is classified as a liability.
³     Duration gap is the difference between the estimated durations (market value sensitivity) of assets and liabilities (including the impact of interest rate exchange agreements) and reflects the extent to which estimated maturity and repricing cash flows for assets and liabilities are matched.

Five Quarter Financial Highlights
(Unaudited)

(Dollars in millions)	Sept. 30,       2006		June 30,       2006		Mar. 31,       2006		Dec. 31,       2005		Sept. 30,       2005
Selected Balance Sheet   Items at Period End
Total Assets	$231,719		$233,750		$227,213		$223,602		$211,760
Advances	174,538		167,356		164,004		162,873		152,956
Mortgage Loans	4,775		4,928		5,079		5,214		5,408
Held-to-Maturity Securities	29,824		30,825		29,963		29,691		28,823
Interest-Bearing Deposits
in Banks	12,568		16,519		9,195		6,899		4,946
Federal Funds Sold	8,600		12,306		16,244		16,997		17,188
Consolidated Obligations:
Bonds	197,711		187,769		198,305		182,625		173,790
Discount Notes	19,653		29,325		14,541		27,618		24,873
Capital Stock -- Class B --
Putable	10,301		10,049		10,007		9,520		9,025
Total Capital	10,437		10,181		10,135		9,648		9,149
Quarterly Operating   Results
Net Interest Income	$217		$201		$193		$187		$178
Other (Loss)/Income	(3	)	(6	)	(10	)	(15	)	(35	)
Other Expense	23		21		21		23		19
Assessments	51		46		43		39		33
Net Income	$140		$128		$119		$110		$  91
Other Data
Net Interest Margin	0.38	%	0.36	%	0.34	%	0.35	%	0.34	%
Operating Expenses as a
Percent of Average Assets	0.03		0.03		0.03		0.04		0.03
Return on Assets	0.24		0.23		0.21		0.20		0.17
Return on Equity	5.59		5.23		4.87		4.70		4.03
Annualized Dividend Rate	5.54		5.22		5.03		4.67		4.58
Dividend Payout Ratio1	97.54		98.09		100.93		97.59		111.38
Capital to Assets Ratio2	4.55		4.39		4.48		4.34		4.34
Duration Gap (in months)3	1		1		1		1		1

1     This ratio is calculated as dividends declared per share divided by net income per share.
²     This ratio is based on regulatory capital, which includes mandatorily redeemable capital stock that is classified as a liability.
³     Duration gap is the difference between the estimated durations (market value sensitivity) of assets and liabilities (including the impact of interest rate exchange agreements) and reflects the extent to which estimated maturity and repricing cash flows for assets and liabilities are matched.

Federal Home Loan Bank of San Francisco

The Federal Home Loan Bank of San Francisco delivers low-cost funding and other services that help member financial institutions make home mortgage loans to people of all income levels and provide credit that supports neighborhoods and communities. The Bank also funds community investment programs that help members create affordable housing and promote community economic development. The Bank's members--its shareholders and customers--are commercial banks, credit unions, savings institutions, thrift and loans, and insurance companies headquartered in Arizona, California, and Nevada.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including statements related to the Bank's dividend rates. These statements are based upon our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as "will" and "plans," or their negatives or other variations on these terms. The Bank cautions that by their nature, forward-looking statements involve risk or uncertainty and that actual results could differ materially from those expressed or implied in these forward-looking statements or could affect the extent to which a particular objective, projection, estimate, or prediction is realized. These forward-looking statements involve risks and uncertainties including, but not limited to, the effects of SFAS 133 and the Bank's ability to pay dividends out of retained earnings. We undertake no obligation to re vise or update publicly any forward-looking statements for any reason.

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Contact:
Amy Stewart, (415) 616-2605
stewarta@fhlbsf.com