8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 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) July 25, 2019

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

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

333 Bush Street, Suite 2700
San Francisco, CA 94104(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 is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	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))

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class Trading Symbol(s) Name of each exchange on which registered

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐

Item 2.02 Results of Operations and Financial Condition.

On July 25, 2019, the Federal Home Loan Bank of San Francisco (the “Bank”) issued a news release announcing its operating results for the second quarter of 2019, and the declaration of a cash dividend on the capital stock outstanding during the second quarter of 2019. A copy of the news 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 report 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 expressly set forth by specific reference in such filing.

Item 7.01 Regulation FD Disclosure.

On July 25, 2019, the Bank announced the declaration of a cash dividend on the capital stock outstanding during the second quarter of 2019. The news release set forth above in Item 2.02 is hereby incorporated into Item 7.01 by reference.

Item 9.01 Financial Statements and Exhibits.

(d)	Exhibit
	99.1	News Release, dated July 25, 2019, 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: July 26, 2019	By:	/s/ J. Gregory Seibly
		J. Gregory Seibly President and Chief Executive Officer

EX-99.1

Exhibit 99.1

Federal Home Loan Bank of San Francisco Announces Second Quarter 2019 Operating Results

SAN FRANCISCO, July 25, 2019 — The Federal Home Loan Bank of San Francisco today announced that its net income for the second quarter of 2019 was $49 million, compared with net income of $104 million for the second quarter of 2018.

The $55 milliondecrease in net income relative to the prior-year period primarily reflected an increase in net fair value losses associated with derivatives, hedged items, and financial instruments carried at fair value, which reduced both net interest income and other income. The decline in net interest income was also due to retrospective adjustment of the effective yields on mortgage loans driven by a lower interest rate environment. In addition, other expenses increased by $5 million in the second quarter of 2019, primarily reflecting operating costs related to the relocation of the Bank's premises. These differences were partially offset by the $6 million reduction in the Affordable Housing Program assessment, which reflected the decline in pre-assessment net income.

Total assets decreased $2.5 billion during the first six months of 2019, to $106.8 billion at June 30, 2019, from $109.3 billion at December 31, 2018. Total advances decreased $6.2 billion, to $67.2 billion at June 30, 2019, from $73.4 billion at December 31, 2018. Investments increased $2.8 billion, to $35.2 billion at June 30, 2019, from $32.4 billion at December 31, 2018, primarily reflecting an increase in available-for-sale securities.

Accumulated other comprehensive incomeincreased by$65 millionduring the first six months of 2019, to $300 million at June 30, 2019, from $235 million at December 31, 2018, primarily as a result of improvement in the fair value of mortgage-backed securities classified as available-for-sale.

As ofJune 30, 2019, the Bank was in compliance with all of its regulatory capital requirements. The Bank’s total regulatory capital ratio was6.1%, exceeding the4.0%requirement. The Bank had$6.5 billion in permanent capital, exceeding its risk-based capital requirement of $1.7 billion. Total retained earnings as of June 30, 2019, were $3.4 billion.

Today, the Bank’s Board of Directors declared a quarterly cash dividend on the capital stock outstanding during the second quarter of 2019 at an annualized rate of 7.00%. The quarterly dividend rate is consistent with the Bank's dividend philosophy of endeavoring to pay a quarterly dividend at a rate between 5% and 7% annualized. The quarterly dividend will total $56 million, including $3 million in dividends on mandatorily redeemable capital stock that will be reflected as interest expense in the third quarter of 2019. The Bank expects to pay the dividend on August 13, 2019.

Financial Highlights

(Unaudited)

(Dollars in millions)

Selected Balance Sheet Items   at Period End	June 30, 2019			Dec. 31, 2018
Total Assets	$	106,762			$109,326
Advances	67,189			73,434
Mortgage Loans Held for Portfolio, Net	3,327			3,066
Investments1	35,180			32,381
Consolidated Obligations:
Bonds	73,915			72,276
Discount Notes	24,901			29,182
Mandatorily Redeemable Capital Stock	138			227
Capital Stock - Class B - Putable	2,967			2,949
Unrestricted Retained Earnings	2,719			2,699
Restricted Retained Earnings	678			647
Accumulated Other Comprehensive Income/(Loss)	300			235
Total Capital	6,664			6,530
Selected Other Data at Period End	June 30, 2019			Dec. 31, 2018
Regulatory Capital Ratio2	6.09		%	5.97		%

	Three Months Ended							Six Months Ended
Selected Operating Results for the Period	June 30, 2019				June 30, 2018			June 30, 2019			June 30, 2018
Net Interest Income		$110				$154			$254			$302
Other Income/(Loss)	(7		)		5			8			(3		)
Other Expense	48				43			91			92
Affordable Housing Program Assessment	6				12			18			22
Net Income		$49				$104			$153			$185
	Three Months Ended							Six Months Ended
Selected Other Data for the Period	June 30, 2019				June 30, 2018			June 30, 2019			June 30, 2018
Net Interest Margin3	0.41			%	0.58		%	0.47		%	0.52			%
Operating Expenses as a Percent of Average Assets	0.15				0.13			0.13			0.12
Return on Average Assets	0.18				0.38			0.28			0.31
Return on Average Equity	2.91				6.31			4.61			5.51
Annualized Dividend Rate	7.00				7.00			7.00			7.00
Average Equity to Average Assets Ratio	6.16				6.08			6.01			5.71

1. Investments consist of Federal funds sold, interest-bearing deposits, trading securities, available-for-sale securities, held-to-maturity securities, and securities purchased under agreements to resell.

2. This ratio is calculated as regulatory capital divided by total assets. Regulatory capital includes retained earnings, Class B capital stock, and mandatorily redeemable capital stock (which is classified as a liability), but excludes accumulated other comprehensive income/(loss). Total regulatory capital as of June 30, 2019, was $6.5 billion.

3. Net interest margin is net interest income (annualized) divided by average interest-earning assets.

Federal Home Loan Bank of San Francisco
The Federal Home Loan Bank of San Francisco is a member-driven cooperative helping local lenders in Arizona, California, and Nevada build strong communities, create opportunity, and change lives for the better. The tools and resources we provide to our member financial institutions–commercial banks, credit unions, industrial loan companies, savings institutions, insurance companies, and community development financial institutions–foster homeownership, expand access to quality housing, seed or sustain small businesses, and revitalize whole neighborhoods. Together with our members and other partners, we are making the communities we serve more vibrant and resilient.

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 philosophy and dividend rates. These statements are based on our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as “endeavoring,” “will,” and “expects,” 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, including future dividends. These forward-looking statements involve risks and uncertainties including, but not limited to, the application of accounting standards relating to, among other things, the amortization of discounts and premiums on financial assets, financial liabilities, and certain fair value gains and losses; hedge accounting of derivatives and underlying financial instruments; the fair values of financial instruments, including investment securities and derivatives; future operating results; and other-than-temporary impairment of investment securities. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

Contact:

Amy Stewart, (415) 616-2605

stewarta@fhlbsf.com