8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

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FORM 8-K

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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, 2018

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FEDERAL HOME LOAN BANK OF INDIANAPOLIS

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

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Federally Chartered Corporation	000-51404	35-6001443
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

8250 Woodfield Crossing Blvd.

Indianapolis IN 46240

(Address of Principal Executive Offices, including Zip Code)

(317) 465-0200

(Registrant's Telephone Number, Including Area Code)

 ______________________________

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):

o Written communications pursuant to Rule 425 under the Securities Act

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

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 o

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. o

Item 2.02. Results of Operations and Financial Condition

On October 25, 2018, the Federal Home Loan Bank of Indianapolis issued a news release announcing dividends declared and financial results for the quarter ended September 30, 2018. 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 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

News Release, dated October 25, 2018, issued by the Federal Home Loan Bank of Indianapolis.

SIGNATURE

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.

Date: October 25, 2018

FEDERAL HOME LOAN BANK OF INDIANAPOLIS
	By:	/s/GREGORY L. TEARE
		Gregory L. Teare
		Executive Vice President - Chief Financial Officer
	By:	/s/K. LOWELL SHORT, JR.
		K. Lowell Short, Jr.
		Senior Vice President - Chief Accounting Officer

EXHIBIT INDEX

Exhibit Number	Description
99.1	News Release of Federal Home Loan Bank of Indianapolis, dated October 25, 2018

EX-99.1

NEWS RELEASE

FOR IMMEDIATE RELEASE	Contact: Carrie O'Connor
October 25, 2018	Senior Director of Communications
	coconnor@fhlbi.com | 317.465.0469

Federal Home Loan Bank of Indianapolis Declares Dividends, Reports Earnings

Indianapolis, IN…Today the Board of Directors of the Federal Home Loan Bank of Indianapolis ("FHLBank Indianapolis" or "Bank") declared its third quarter2018 dividends on Class B-1 and Class B-2 capital stock at annualized rates of 4.50% and 3.60%, respectively. The dividends will be paid in cash on October 26, 2018.

Earnings Highlights

Net income for the third quarter of 2018 was $39 million, a decrease of $2 million compared to the same quarter in the prior year, primarily due to higher net losses on derivatives and hedging activities and, to a lesser extent, higher operating expenses, partially offset by higher net interest income. Net interest income¹ after provision for credit losses was $73 million, an increase of $4 million compared to the same quarter in the prior year, primarily as a result of an increase in the average balance of assets.

Net income for the nine months endedSeptember 30, 2018 was $156 million, an increase of $46 million compared to the same period in the prior year, primarily due to a net realized gain on the sale of all of the Bank's private-label mortgage-backed securities ("PLMBS"), higher net interest income and lower net losses on derivatives and hedging activities, partially offset by higher operating expenses. Net interest income after provision for credit losses was $213 million, an increase of $21 million compared to the same period in the prior year, primarily as a result of an increase in the average balance of assets.

Affordable Housing Program Allocation²

As a direct result of the earnings for the nine months endedSeptember 30, 2018, FHLBank Indianapolis allocated $18 million to its Affordable Housing Program ("AHP"), which provides grant funding to support housing for low- and moderate-income families in Michigan and Indiana. Full year 2018 AHP allocations will be available to the Bank's members in 2019 to help address their communities' affordable housing needs, including construction, rehabilitation, accessibility improvements and homebuyer down-payment assistance.

¹  FHLBank Indianapolis earns interest income on advances to and mortgage loans purchased from its Michigan and Indiana member financial institutions, as well as on long- and short-term investments. Net interest income is primarily determined by the spread between the interest earned on those assets and the interest cost of funding with consolidated obligations.

²  Each year FHLBanks allocate to the AHP 10% of earnings, which is defined as income before assessments, plus interest expense on mandatorily redeemable capital stock.

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Balance Sheet Highlights

Total assets at September 30, 2018 were $66.5 billion, an increase of $4.1 billion, or 7%, from December 31, 2017, primarily driven by an increase in short-term investments outstanding to enhance the Bank's liquidity position in light of the issuance of new regulatory guidance from the Federal Housing Finance Agency.

Advances³ 

Advances outstanding at September 30, 2018 totaled $33.6 billion, a net decrease of $488 million from December 31, 2017, due to a decline in short-term advances outstanding.

Advances to depository members - comprising commercial banks, savings institutions and credit unions - decreased by 5%. Advances to insurance company members increased by 3%. Advances to depository institutions, as a percent of total advances outstanding, were 53% at September 30, 2018, while advances to insurance companies were 47%.

Mortgage Loans Held for Portfolio⁴ 

Mortgage loan purchases from members for the nine months endedSeptember 30, 2018totaled $1.9 billion. Mortgage loans held for portfolio at September 30, 2018 totaled $11.3 billion, a net increase of $938 million, or 9%, from December 31, 2017.

Consolidated Obligations⁵ 

FHLBank Indianapolis' consolidated obligations outstanding at September 30, 2018 totaled $62.2 billion, a net increase of $4.0 billion, or 7%, from December 31, 2017. The increase in consolidated obligations supported the increase in the Bank's assets.

Capital⁶ 

Total capital at September 30, 2018 was $3.1 billion, a net increase of $111 million, or 4%, from December 31, 2017, primarily as a result of the growth of retained earnings and additional capital stock issued to members. These increases were partially offset by the reduction in accumulated other comprehensive income as a result of the recognition of the gain on the PLMBS sale.

The Bank's regulatory capital⁷-to-assets ratio at September 30, 2018 was 4.70%, which exceeds all applicable regulatory capital requirements.

³  Advances are secured loans that FHLBank Indianapolis provides to its member institutions.

⁴   FHLBank Indianapolis purchases mortgage loans from its members to support its housing mission, provide an additional source of liquidity to its members, and diversify its investments.

⁵  The primary source of funds for FHLBank Indianapolis, and for the other Federal Home Loan Banks ("FHLBanks"), is the sale of FHLBanks' consolidated obligations in the capital markets. FHLBank Indianapolis is the primary obligor for the payment of the principal and interest on the consolidated obligations issued on its behalf; additionally, it is jointly and severally liable with each of the other FHLBanks for all of the FHLBanks' consolidated obligations outstanding.

⁶  FHLBank Indianapolis is a cooperative whose member financial institutions and former members own all of its capital stock as a condition of membership and to support outstanding credit products.

⁷  Total regulatory capital consists of capital stock, mandatorily redeemable capital stock and retained earnings.

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All amounts referenced above and in the following table are unaudited. More detailed information about FHLBank Indianapolis' financial results for the three and nine months ended September 30, 2018 will be included in the Bank's Quarterly Report on Form 10-Q, which we intend to file by mid-November.

Federal Home Loan Bank of Indianapolis

Financial Highlights (unaudited)

($ amounts in millions, as rounded)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
Condensed Statements of Income	2018			2017			2018		2017
Net interest income after provision for credit losses	$	73		$	69		$	213	$	192
Other income (loss)	(7		)	(3		)	30		(10		)
Other expenses	23			20			69		59
AHP assessments	4			5			18		13
Net income	$	39		$	41		$	156	$	110

Condensed Statements of Condition	September 30, 2018			December 31, 2017
Advances	$	33,567		$	34,055
Mortgage loans held for portfolio, net	11,294			10,356
Cash and short-term investments	8,056			4,601
Other assets (1)	13,555			13,337
Total assets	$	66,472		$	62,349
Consolidated obligations	$	62,214		$	58,254
Mandatorily redeemable capital stock	164			164
Other liabilities	1,037			985
Total liabilities	63,415			59,403
Capital stock (2)	1,901			1,858
Retained earnings (3)	1,061			976
Accumulated other comprehensive income	95			112
Total capital	3,057			2,946
Total liabilities and capital	$	66,472		$	62,349
Total regulatory capital (4)	$	3,126		$	2,998
Regulatory capital-to-assets ratio	4.70		%	4.81		%

⁽¹⁾  Includes held-to-maturity securities and available-for-sale securities.

⁽²⁾  Putable by members at par value.

⁽³⁾  Includes restricted retained earnings at September 30, 2018 and December 31, 2017 of $215 million and $183 million, respectively.

⁽⁴⁾   Consists of total capital less accumulated other comprehensive income plus mandatorily redeemable capital stock.

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Safe Harbor Statement

This document may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 concerning plans, objectives, goals, strategies, future events or performance. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects" or the negative of these terms or comparable terminology. Any forward-looking statement contained in this document reflects FHLBank Indianapolis' current beliefs and expectations. Actual results or performance may differ materially from what is expressed in any forward-looking statements.

Any forward-looking statement contained in this document speaks only as of the date on which it was made. FHLBank Indianapolis undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Readers are referred to the documents filed by the Bank with the U.S. Securities and Exchange Commission, specifically reports on Form 10-K and Form 10-Q, which include factors that could cause actual results to differ from forward-looking statements. These reports are available at www.sec.gov.

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Building Partnerships. Serving Communities.

The Federal Home Loan Bank of Indianapolis (FHLBank Indianapolis) is a regional bank included in the Federal Home Loan Bank System. FHLBanks are government-sponsored enterprises created by Congress to ensure access to low-cost funding for their member financial institutions, with particular attention paid to providing solutions that support the housing and small business needs of members' customers. FHLBanks are privately capitalized and funded, and receive no Congressional appropriations. FHLBank Indianapolis is owned by its Indiana and Michigan financial institution members, which include commercial banks, credit unions, insurance companies, savings institutions and community development financial institutions. For more information about FHLBank Indianapolis, visit www.fhlbi.com.

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