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) May 19, 2006

FEDERAL HOME LOAN BANK OF BOSTON

(Exact name of registrant as specified in its charter)

Federally chartered corporation	000-51402	04-6002575
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

111 Huntington Avenue
Boston, MA 02199

(Address of principal executive offices, including zip code)

(617) 292-9600

(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):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

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

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

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

Item 7.01 Regulation FD Disclosure.

On May 19, 2006, Michael A. Jessee, president and chief executive officer of the Federal Home Loan Bank of Boston (the Bank), sent a letter to members of the Bank announcing that the Bank’s board of directors has approved a plan to change the timing of dividend declarations and payments. A copy of the letter is attached to this report. The information contained in the attachment is being furnished 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.

Exhibit No.	Description
99.1	Letter to members of the Federal Home Loan Bank of Boston, dated May 19, 2006

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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 Boston
Date:  May 19, 2006	By:	/s/ MICHAEL L. WILSON
		Michael L. Wilson
		Senior Executive Vice President and Chief Operating Officer

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EX-99.1

Exhibit 99.1

DIVIDEND SCHEDULE TRANSITION PLAN

May 19, 2006

TO: All Members

The board of directors of the Federal Home Loan Bank of Boston (the Bank) has approved a plan to change the timing of dividend declarations and payments. This change will be implemented during the second and third quarters of 2006.

Background

Historically, the Bank’s board has determined and declared an annualized dividend rate prior to the end of the calendar quarter to which the dividend pertained, and paid the dividend on the second business day following the end of that quarter. At the time of declaration, the exact dollar amount of the dividend could not be determined since it is based on the daily average stock holding for the entire quarter. Moreover, the impact of the dividend on the Bank’s balance of retained earnings could not be known with certainty, as net income is also not determined until after the quarter has ended.

The board has determined that the Bank should adopt a dividend declaration and payment schedule that declares dividends only after net income is calculated. This change would also comply with the proposed regulations 12 C.F.R. Parts 931.9(c) and 934.4(a), which would prohibit the declaration of dividends based on anticipated or projected earnings.

Rationale

Notwithstanding the provisions of the proposed capital regulation, the Bank is committed to achieving and maintaining an adequate level of retained earnings commensurate with the Bank’s risk profile. To the extent that dividends are declared on the basis of estimated or projected quarterly net income, rather than actual net income, there is a risk that retained-earnings objectives will not be achieved or maintained. Because certain calculations with respect to net income cannot be made until the quarterly close process is completed, net income cannot be known with certainty until the books are closed. Therefore, it is prudent to declare and pay dividends only after quarterly net income has been determined.

Dividend Schedule Transition Plan

The Dividend Schedule Transition Plan (DSTP) will be effected over a two-quarter period. The anticipated impact of the DSTP is that (i) the dividend based on net income for the second quarter of 2006 will be declared in the third quarter of 2006 (that is, no dividend will be declared in the second quarter of 2006), and (ii) this dividend will be “grossed-up” to an equivalent accrual period matching the number of days in the second and third quarters. In this manner, the Bank would still declare roughly the equivalent of four quarterly dividends in 2006. However, all future dividends would be declared by the board only after net income for the quarter has been calculated.

DIVIDEND SCHEDULE TRANSITION PLAN

May 19, 2006

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The following table describes how the transition strategy compares with the status quo:

Action	Status Quo	Under DSTP
Declaration of dividend based on Q2 2006 net income	June 2006	August 2006 (that is, no dividend is declared in Q2 2006)
Payment of dividend based on Q2 2006 net income	July 2006	September 2006
Daycount factor for dividend based on Q2 2006 net income	91 days (number of days in April — June)	183 days (number of days in April — September)
Declaration of dividend based on Q3 2006 net income	September 2006	November 2006
Payment of dividend based on Q3 2006 net income	October 2006	December 2006

Potential Limitations

It must be noted that the DSTP could be impacted by the adoption of the Federal Housing Finance Board’s proposed regulations concerning the timing of dividends and minimum retained-earnings requirements(1). Specifically, if these proposed regulations were enacted in their current form prior to the payment of the dividend that will be based on net income for the second quarter of 2006 (expected in September 2006), that dividend would have to be reduced to a 91-day accrual period in order to comply with these regulations. Moreover, as always, the Bank can make no commitment as to the payment of any future dividend, which is subject to (i) the discretion of the board of directors, (ii) compliance with all applicable laws and regulations, and (iii) any potential order or directive issued by the Federal Housing Finance Board, among other potential factors.

(1)See proposed 12 C.F.R. Parts 931.9(c), 934.2, 934.3, and 934.4(a).

If you have any questions or concerns regarding the implementation of the DSTP, please contact one of the following individuals:

·Frank Nitkiewicz, executive vice president and chief financial officer, at 617-292-9624

·Michael L. Wilson, senior executive vice president and chief operating officer, at 617-292-9683

·Earl W. Baucom, first vice president and chief accounting officer, at 617-292-9789

We thank you for your support over the course of this transition.

Sincerely,

Michael A. Jessee
President and Chief Executive Officer