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) April 23, 2010

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 EmployerIdentification 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 2.02 Results of Operations and Financial Condition

On April 23, 2010, the Federal Home Loan Bank of Boston (the Bank) issued a press release regarding the Bank’s preliminary unaudited financial results for the quarter ending March 31, 2010. A copy of the press release is included as Exhibit 99.1 to this report. The information in this Item 2.02 and contained in Exhibit 99.1 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.

This report, including Items 2.02 and 7.01 and Exhibits 99.1 and 99.2, uses forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are based on the Bank’s expectations as of the date hereof. The words “will,” “may,” “target,” “predict,” “expect,” “project,” “likely,” and similar statements and their plural, negative, past and progressive forms as well as statements about the Bank’s operating plan are used in this notification to identify some, but not all, of such forward-looking statements. The Bank cautions that, by their nature, 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; and other-than-temporary impairment of investment securities, in addition to instability in the credit and debt markets, economic conditions (including effects on, among other things, mortgage-backed securities), changes in interest rates, and prepayment spreads on mortgage assets. The Bank does not undertake to update any forward-looking statement herein or that may be made from time to time on behalf of the Bank.

Item 7.01 Regulation FD Disclosure

On April 23, 2010, Edward A. Hjerpe III, president and chief executive officer of the Bank, presented information to members at the Bank’s annual meeting of shareholders. A copy of this presentation is attached as Exhibit 99.2 to this Form 8-K. The information in this Item 7.01 and contained in Exhibit 99.2 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

(d) Exhibits.

Exhibit Number

99.1 Press release issued by the Bank on April 23, 2010.

99.2 Presentation to Bank members on April 23, 2010.

2

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: April 23, 2010	By:	/s/ Frank Nitkiewicz
		Frank Nitkiewicz Executive Vice President and Chief Financial Officer

3

EX-99.1

Exhibit 99.1

	NEWS RELEASE
FOR IMMEDIATE RELEASE	CONTACT: Mark S. Zelermyer
April 23, 2010	617-292-9750
	mark.zelermyer@fhlbboston.com

FEDERAL HOME LOAN BANK OF BOSTON ANNOUNCES

FIRST QUARTER 2010 RESULTS

BOSTON — The Federal Home Loan Bank of Boston (the Bank) announced the following unaudited results for the quarter ended March 31, 2010. Bank President and Chief Executive Officer Edward A. Hjerpe III, commented, “We are pleased to begin 2010 with a second consecutive quarter of modest positive net income. Though market uncertainties may continue to impact our investment portfolio, our core business remains strong as our balance sheet returns to pre-credit-crisis levels. We remain committed to preserving capital, building retained earnings, and achieving consistent profitability so that we may return to paying dividends, repurchasing excess stock, and more fully funding the Affordable Housing Program.”

First Quarter 2010 Balance-Sheet Highlights

Total assets declined 1.5 percent to $61.6 billion at March 31, 2010, down from $62.5 billion at December 31, 2009. The $918.3 million decrease was driven by a $2.4 billion decrease in advances, partially offset by a $1.4 billion increase in cash and investments.

Total advances decreased 6.4 percent to $35.2 billion at March 31, 2010, compared with $37.6 billion at December 31, 2009. The $2.4 billion reduction in advances was primarily attributable to reduced lending activities and high deposit levels at member financial institutions.

Total investments increased 6.5 percent to $22.3 billion at March 31, 2010, compared with $20.9 billion at December 31, 2009. The $1.4 billion increase was primarily attributable to investments in agency and government-guaranteed debentures, and agency mortgage-backed securities (MBS). The par value of private-label MBS declined by $134.2 million, from $3.6 billion at December 31, 2009, to $3.4 billion at March 31, 2010, while the carrying value of private-label MBS declined by $75.4 million, from $2.2 billion at December 31, 2009, to $2.1 billion at March 31, 2010.

Total mortgage loans purchased through the Mortgage Partnership Finance® program decreased 3.2 percent to $3.4 billion at March 31, 2010, compared with $3.5 billion at December 31, 2009, as origination volumes remained relatively low during the quarter.

Total GAAP capital increased 4.4 percent to $2.9 billion at March 31, 2010, compared with $2.8 billion at December 31, 2009. The $120.9 million increase was primarily attributable to a $22.9 million increase in retained earnings, and a decrease in accumulated other comprehensive loss of $94.9 million. The decrease in accumulated other comprehensive loss was due to a decline in

unrealized losses on available-for-sale securities, as well as a decline in the net noncredit portion of other-than-temporary impairment losses.

The Bank’s total regulatory capital-to-assets ratio was 6.3 percent at March 31, 2010, exceeding the regulatory minimum requirements by 2.3 percentage points. The Bank’s permanent capital was $3.9 billion, exceeding its risk-based capital requirement of $1.4 billion by $2.5 billion.

First Quarter 2010 Operating Results

Net income for the first quarter of 2010 was $22.9 million, compared with a net loss of $83.4 million in the first quarter of 2009. The $106.3 million increase was primarily due to a $104.1 million decrease in the credit-related other-than-temporary impairment charges on certain private-label MBS, an $11.0 million increase in net interest income after provision for credit losses, partially offset by a $5.7 million increase in REFCorp assessments and a $2.5 million increase in Affordable Housing Program contributions.

Credit-related other-than-temporary impairment charges on certain private-label MBS were $22.8 million for the first quarter of 2010, a $104.1 million, or 82.0 percent, decrease from the $126.9 million charge recorded in the first quarter of 2009. The $22.8 million charge resulted from an increase in projected losses on the collateral underlying certain private-label MBS. The reduction in credit losses attributable to other-than-temporary impairment compared with the same quarter a year ago primarily reflects the stabilization in some factors affecting the expected performance of the mortgage loans underlying the Bank’s private-label MBS, such as home prices and unemployment rates.

Net interest income after provision for credit losses for the first quarter of 2010 increased 19.2 percent to $67.9 million, compared with $57.0 million recorded in the first quarter of 2009. The $11.0 million increase was primarily attributable to a decrease of 78 basis points in the cost of interest-bearing liabilities to 0.97 percent, partially offset by a decrease of 60 basis points in the yield on interest-earning assets to 1.34 percent, and a $14.5 billion decrease in average interest-earning assets to $64.2 billion.

The net interest margin for the first quarter of 2010 was 0.43 percent, a 14 basis point increase from the 0.29 percent recorded in the first quarter of 2009. The net interest spread for the first quarter of 2010 was 0.37 percent, an 18 basis point increase from the 0.19 percent recorded in the first quarter of 2009.

The Federal Home Loan Bank of Boston is a cooperatively owned wholesale bank for housing finance in the six New England states. Its mission is to support the residential-mortgage and community-development lending activities of its members, which include over 460 financial institutions across New England. To accomplish its mission, the Bank utilizes private-sector capital to provide members and other qualified customers with reliable access to low-cost wholesale funds, liquidity, a competitive outlet for the sale of loans, special lending programs, technical assistance, and other products and services.

Balance Sheet Highlights

(Dollars in thousands)

(Unaudited)

	03/31/2010			12/31/2009			03/31/2009
ASSETS
Advances	$	35,174,620		$	37,591,461		$	49,433,322
Investments (1)	22,299,907			20,947,464			22,556,759
Mortgage loans held for portfolio, net	3,392,872			3,505,975			4,066,816
Total assets	61,568,720			62,487,000			76,379,296
LIABILITIES
Deposits	664,505			772,457			840,850
Consolidated obligations, net	56,918,300			57,686,832			71,511,859
Mandatorily redeemable capital stock	90,803			90,896			90,886
CAPITAL
Class B capital stock	3,646,201			3,643,101			3,604,513
Retained earnings	165,507			142,606			245,919
Accumulated other comprehensive loss	(926,733		)	(1,021,649		)	(1,258,202		)
Total capital	2,884,975			2,764,058			2,592,230
Total liabilities and capital	61,568,720			62,487,000			76,379,296
Regulatory capital ratio	6.3		%	6.2		%	5.2		%
Ratio of market value of equity (MVE) to par stock (2)	81.5		%	77.6		%	49.3		%

Income Statement Highlights

(Dollars in thousands)

(Unaudited)

	For the Three Months Ended
	03/31/2010			12/31/2009			03/31/2009
Total interest income	$	211,450		$	232,193		$	377,297
Total interest expense	143,079			144,215			320,220
Net interest income	68,371			87,978			57,077
Net interest income after provision for credit losses on mortgage loans	67,940			87,528			56,977
Other-than-temporary impairment losses on held-to-maturity securities	(22,824		)	(72,440		)	(126,912		)
Other income	525			5,011			2,049
Operating expense	12,375			11,884			13,730
Other expense	2,095			1,903			1,822
Affordable Housing Program	2,545			—			—
REFCorp	5,725			—			—
Total assessments	8,270			—			—
Net income (loss)	22,901			6,312			(83,438		)
Performance Ratios:
Return on average assets	0.15		%	0.04		%	(0.43		)%
Return on average equity	3.28		%	0.93		%	(9.80		)%
Net interest spread	0.37		%	0.50		%	0.19		%
Net interest margin	0.43		%	0.54		%	0.29		%

(1)Investments include available-for-sale securities, held-to-maturity securities, trading securities, interest-bearing deposits, securities purchased under agreements to resell, and federal funds sold.

(2)MVE equals the difference between the theoretical market value of assets and the theoretical market value of liabilities, and the ratio of MVE to par value of Bank stock can be an indicator of future net income to the extent that it demonstrates the impact of prior interest-rate movements on the capacity of the current balance sheet to generate net interest income. However, this ratio does not always provide an accurate indication of future net income.  Accordingly, investors should not place undue reliance on this ratio and are encouraged to read the Bank’s discussion of MVE, including discussion of the limitations of MVE as a metric, in Item 7A —Quantitative and Qualitative Disclosures About Market Risk—Market and Interest Rate Risk—Measurement of Market and Interest Rate Risk—Market Value of Equity Estimation and Market Risk Limit in its annual report on Form 10-K filed with the Securities and Exchange Commission on March 22, 2010.

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Forward-Looking Statements

This release, including the unaudited quarterly balance sheet and income statement highlights, uses forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and are based on the Bank’s expectations as of the date hereof. The words “may continue,” “may return,” and similar statements and their plural and negative forms are used in this notification to identify some, but not all, of such forward-looking statements. The Bank cautions that, by their nature, 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; and other-than-temporary impairment of investment securities, in addition to instability in the credit and debt markets, economic conditions (including effects on, among other things, mortgage-backed securities), changes in interest rates, and prepayment spreads on mortgage assets. The Bank does not undertake to update any forward-looking statement herein or that may be made from time to time on behalf of the Bank.

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EX-99.2

Exhibit 99.2

Federal Home Loan Bank of Boston 77th Annual Shareholders Meeting April 23, 2010

2 Federal Home Loan Bank of Boston Today’s Agenda 2009: A Year of Change and Challenge Financial Results Economy, Industry, and Legislation Keynote Address: William D. Cohan Adjourn

3 Federal Home Loan Bank of Boston Forward-Looking Statements This presentation, including the first quarter 2010 highlights herein, uses forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and are based on the Bank’s expectations as of the date hereof. The words “will,” “may,” “target,” “predict,” “expect,” “project,” “likely,” and similar statements and their plural, negative, past, and progressive forms as well as statements about the Bank’s operating plan are used in this notification to identify some, but not all, of such forward-looking statements. The Bank cautions that, by their nature, 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; and other-thant-emporary impairment of investment securities, in addition to instability in the credit and debt markets, economic conditions (including effects on, among other things, mortgage-backed securities), changes in interest rates, and prepayment spreads on mortgage assets. The Bank does not undertake to update any forward-looking statement herein or that may be made from time to time on behalf of the Bank.

Federal Home Loan Bank of Boston 2009: A Year of Change and Challenge

5 Federal Home Loan Bank of Boston 2009: A Year of Change and Challenge Consistently strong core business as balance sheet contracted Weakness in economy, housing and credit markets, and high unemployment directly affected Bank’s portfolio of private-label mortgage-backed securities, profitability, and retained earnings Analysis of business and operating environment led to changes in management team and reductions in staff and operating expenses Ten members joined the Bank Collectively purchased $27.5 million in capital stock Twentieth anniversary of Affordable Housing Program

6 Federal Home Loan Bank of Boston Twenty Years of the Affordable Housing Program National Housing Conference 2010 Program of the Year Award Twenty-Year Results *Federal Housing Finance Agency database as of June 30, 2009 In 2010, Bank will award $5 million accelerated from future net profits through the Affordable Housing Program and Equity Builder Program Since 2003, more than $13 million disbursed to members participating in the Equity Builder Program, assisting more than 1,200 home buyers 2010 also marks 10-year anniversary of Greater Boston Affordable Housing Development Competition Boston FHLBank System Grants and subsidies $185 million $3.7 billion* Units 22,300 674,100*

7 Federal Home Loan Bank of Boston Current Business Issues Bank committed to preserving capital and building retained earnings to protect against unexpected losses Moratorium on excess stock repurchases Dividend suspension Goal: restore consistent profitability and normal operations so that we can pay a dividend, repurchase excess stock, and more fully fund the Affordable Housing Program Bank continues to provide a dependable source of liquidity, develop new products and services that help you succeed, and look at additional enhancements

8 Federal Home Loan Bank of Boston Operating Plan Board, management, and staff developed a five-year plan Prudent, profitable asset and earnings growth Thoughtful expense reduction that will not impact quality and level of member service Product development to help you meet your funding and balance-sheet needs As part of plan, board adopted revised retained earnings target Plan has been evaluated under range of economic scenarios

9 Federal Home Loan Bank of Boston New Products and Enhancements 2009 Letters of credit for nonhousing tax-exempt bonds Expander advance Advance Restructuring Economic Stimulus advance MPF Xtra™ 2010 Direct+ Refundable letters of credit Collar, Corridor, and other advances in development Members’ continued use of Bank products helps us return to consistent profitability

Federal Home Loan Bank of Boston Financial Results

11 Federal Home Loan Bank of Boston First Quarter 2010 Highlights $5.7 million REFCorp $2.5 million AHP Assets $61.6 billion Advances $35.2 billion Pre-Assessment Net Income Before OTTI, REFCorp and AHP $54.0 million Credit-Related OTTI Losses $(22.8 million) Net Income $22.9 million

12 Federal Home Loan Bank of Boston Total Assets, Advances, and MPF 57.5 37.3 4.5 78.2 55.7 4.1 80.4 56.9 4.2 62.5 37.6 3.5 61.6 35.2 3.4 $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 In Billions 2006 2007 2008 2009 Q1 2010 Total Assets Advances MPF

13 Federal Home Loan Bank of Boston Total Investments and Private-Label Mortgage-Backed Securities 5.9 1.3 8.0 6.0 2.0 9.9 4.0 4.8 10.1 2.2 5.9 12.8 2.1 6.2 14.0 $0 $5 $10 $15 $20 $25 In Billions 2006 2007 2008 2009 Q1 2010 PLMBS Agency MBS Other 15.2 17.9 18.9 20.9 22.3 Investments include available-for-sale securities, held-to-maturity securities, trading securities, interest-bearing deposits, securities purchased under agreements to resell, and federal funds sold, shown at carrying value.

14 Federal Home Loan Bank of Boston Net Income 195.8 198.2 (115.8) (186.8) 22.9 ($200) ($100) $0 $100 $200 In Millions 2006 2007 2008* 2009 Q1 2010 *Includes $349.1 million of noncredit losses on PLMBS, subsequently reclassified to accumulated OCI upon adoption of amended accounting guidance related to OTTI.

15 Federal Home Loan Bank of Boston Pre-Assessment Net Income Before OTTI, REFCorp, and AHP 266.6 270.0 265.9 257.3 54.0 $0 $50 $100 $150 $200 $250 $300 In Millions 2006 2007 2008 2009 Q1 2010

16 Federal Home Loan Bank of Boston Return on Average Assets and Average Equity 0.33% 7.2% 0.30% 7.0% -0.14% -3.2% -0.27% -6.5% 0.15% 3.3% -8% -6% -4% -2% 0% 2% 4% 6% 8% 2006 2007 2008 2009 Q1 2010 Return on Average Assets Return on Average Equity

17 Federal Home Loan Bank of Boston Total Capital In Millions 187 3 2,343 226 (2) 3,164 (20) (135) 3,585 143 (1,022) 3,643 166 (927) 3,646 ($1,500) ($1,000) ($500) $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 2006 2007 2008 2009 Q1 2010 Class-B Stock Accumulated OCI Retained Earnings 2,533 3,388 3,430 2,764 2,885

18 Federal Home Loan Bank of Boston Regulatory Capital Ratio 4.4% 4.4% 4.6% 6.2% 6.3% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 6.0% 6.5% 7.0% 2006 2007 2008 2009 Q1 2010 Minimum

19 Federal Home Loan Bank of Boston Market Value of Equity/Par Stock Continues to Improve Since 2008 Low 109.4% 102.6% 48.1% 77.6% 81.5% 0% 20% 40% 60% 80% 100% 120% 2006 2007 2008 2009 Q1 2010

20 Federal Home Loan Bank of Boston Private-Label Mortgage-Backed Securities $31 million $68.13 $67.54 $71.87 $97.46 $45 million Subprime 2004 and prior $130 million $97.55 $96.57 $82.79 $99.60 $431 million CMBS 2003 and prior Collateral Vintage Par Value 12/31/07 Avg. Price 12/31/07 Avg. Price 12/31/08 Avg. Price 12/31/09 Avg. Price 3/31/10 Par Value 3/31/10 Alt-A 2007 and prior $3.2 billion $97.28 $52.41 $52.60 $53.98 $1.8 billion Pay Option 2004 to 2007 $1.4 billion $95.73 $44.64 $48.84 $53.49 $1.1 billion Prime 2007 and prior $900 million $99.00 $74.59 $82.26 $84.13 $400 million Total $6.0 billion $97.35 $55.04 $58.28 $59.27 $3.4 billion

21 Federal Home Loan Bank of Boston Private-Label Mortgage-Backed Securities No private-label mortgage-backed securities purchased since 2007 60 percent concentrated in “sand states” High foreclosure and delinquency rates Value going forward is hard to predict Function of housing prices, delinquency, foreclosure, unemployment, and loss severities, among other variables Could add volatility to Bank’s balance sheet and affect earnings for some time

22 Federal Home Loan Bank of Boston Timetable for Dividends and Excess Stock Repurchases Preservation of capital essential; need to demonstrate consistent profitability and retained earnings growth before resuming dividends Revised operating plan implemented, but some components require regulatory review Two quarters of positive net income; hopeful for balance of 2010, but economy, interest rates, and value of PLMBS will be important factors in the outcome Will keep you apprised of developments, and ensure open communication Member outreach meetings to start again in summer

Federal Home Loan Bank of Boston Economy, Industry, and Legislation

Federal Home Loan Bank of Boston Economic Outlook Interest rates expected to rise Projected 3.1 percent gross domestic product growth in 2010 Unemployment expected to decline slowly after recent peak Slight improvement expected, but housing market still challenged Ramifications for FHLB Boston Rising interest rates are generally favorable for growth in income Advances growth highly correlated with healthy housing market Member condition tied to economy and housing market Source: Blue Chip Financial Forecast Projections 24

25 Federal Home Loan Bank of Boston Housing Market and Employment 0% 10% 20% 30% 40% CT MA ME NH RI VT NE US Subprime Loans Prime Loans US NE MA ME CT VT RI NH -40% -30% -20% -10% 0% US NE MA ME CT VT RI NH 0% 5% 10% 15% US NE CT MA ME NH RI VT US NE MA ME CT VT RI NH -10% -8% -6% -4% -2% 0% US NE MA ME CT VT RI NH Percent of Mortgages >30 Days Delinquent Source: MBA 4Q09 national delinquency survey Housing Prices - Projected Peak to Trough Percentage Decline Current Unemployment Rate Projected Peak to Trough Percent Decline in Total Employment Source: New England Economic Partnership Source: BLS February, 2010 (NE data dated Nov. 2009) Source: New England Economic Partnership

26 Federal Home Loan Bank of Boston FHLB Boston Members Aggregate financial condition of the Bank’s members is among strongest in FHLBank System 90 percent of depository institution members have nonperforming asset/total asset ratio of less than three percent Most depository institution members have adequate capital cushion against adverse earnings and asset quality trends of past two years Just one member has failed since 1993

27 Membership Financial Performance Net Operating Revenue = Net Interest Income + Total Non-Interest Income. Source: FDIC Quarterly Banking Profile, Fourth Quarter 2009 Earnings challenges for the Bank’s members Loan loss reserve expense Margin compression Securities losses FDIC assessments Write-down of credit union investments in certain corporate credit unions Member challenges mirror national trends, but less severe New England FDIC-Insured Institutions ($Millions) 13% $0 $200 $400 $600 $800 $1,000 $1,200 Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109 Q209 Q309 Q409 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Loan Loss Provision LLP Percent of Net Operating Revenue

28 Federal Home Loan Bank of Boston Financial Reform Legislation House version, H.R. 4173, passed on December 11, 2009 Revamps regulatory agencies, creates oversight of derivatives market, and gives government authority to wind down large, troubled firms Establishes Consumer Financial Protection Agency to protect against mortgages, credit cards, and unfair predatory lending Senate version, “the Dodd bill,” passed out of committee on March 22, 2010 Covers similar ground as House version and includes tough language on ratings agencies Financial companies over $50 billion deemed "systemically significant" would be subject to Federal Reserve Board supervision Consumer protection bureau would reside within the Federal Reserve Expected to go to the Senate floor as early as April 26

29 Federal Home Loan Bank of Boston FHLBanks and Financial Reform Legislation Financial reform likely to happen this year, but elements of current “Dodd bill” would impact FHLBanks Working with the Council of FHLBanks on technical amendments, but nothing intended to structurally damage the System Concentration limit, proprietary trading restrictions, derivatives Future of housing finance GSEs will be considered next year Administration has issued a request for comment House Financial Services has held two hearings, and more expected Focus is on resolution of Fannie Mae and Freddie Mac; we’ll be watching closely Appreciate trade associations’ support

30 Federal Home Loan Bank of Boston Future of Resolution Funding Corporation REFCorp created by Congress as part of FIRREA in 1989 to address savings and loan crisis FHLBanks required to contribute 20 percent of net income to partially offset costs for failed savings and loan institutions Obligation expected to be satisfied in 2012 – nearly 20 years earlier than anticipated We believe best use of these funds after meeting obligation should be to build retained earnings and protect FHLBanks’ financial condition FHLB Boston FHLBanks Retained Earnings Taken at FIRREA $53.0 million $2.5 billion Total REFCorp Interest Payments through Q1 2010 $428.3 million $8.2 billion

31 Federal Home Loan Bank of Boston Bank is owned by you and we fulfill our mission by helping you succeed We work together to provide your communities with a steady supply of credit, in all business cycles We commit to strengthening our earnings and capital position so that we can pay dividends, repurchase excess stock, and more fully fund the Affordable Housing Program as soon as prudently possible community commitment cooperative

Federal Home Loan Bank of Boston 77th Annual Shareholders Meeting April 23, 2010