ATLANTA – The Federal Home Loan Bank of Atlanta said it is using congressionally approved powers to offer letters of credit to its members unrelated to mortgage activities.
The Atlanta bank said it has provided more than 50 letters of credit totaling more than $2.2 billion for non-housing-related, tax-exempt bond transactions, stimulating economic development and lowering the cost of borrowing for public finance projects.
The Housing and Economic Recovery Act of 2008 authorized FHLB Atlanta to provide credit support for tax-exempt bonds issued or refunded between July 30, 2008 and Dec. 31, 2010. Traditionally, FHLBank Atlanta provided letters of credit for housing-related and taxable financing, and HERA now permits the support of a wider range of public projects, including economic development, public utility and healthcare facilities.
FHLBank Atlanta's triple-A credit rating allows local governmental entities to borrow at lower costs while helping to maintain the flow of financing within a tighter credit market. In a typical transaction, FHLBank Atlanta serves as a provider of credit enhancement for the transaction on behalf of its member institutions as they work directly with municipal bond issuers.
