Federal Home Loan Bank of Atlanta

11/05/2026 | Press release | Distributed by Public on 11/05/2026 10:58

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations.
Forward-Looking Information
Some of the statements made in this quarterly report on Form 10-Q (Report) may be "forward-looking statements", which include statements with respect to the plans, objectives, expectations, estimates, and future performance of the Bank and involve known and unknown risks, uncertainties, and other factors, many of which are beyond the Bank's control and may cause the Bank's actual results, performance, or achievements to be materially different from future results, performance, or achievements expressed or implied by the forward-looking statements. All statements other than statements of historical fact are forward-looking statements. The reader can identify these forward-looking statements through the use of words such as "may," "will," "anticipate," "hope," "project," "assume," "should," "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "plan," "point to," "could," "intend," "seek," "target" and other similar words and expressions of the future.
Forward-looking statements may include statements related to, among others, the interest-rate environment; demand for Bank advances and for FHLBank consolidated obligations; gains and losses on derivatives; plans to pay dividends or repurchase excess capital stock; the impact of changes in product offerings and demand; product offerings and pricing; AHP and voluntary programs; the impact of housing reform and the impact of prospective legislative or regulatory changes on the Bank or its members; and the impact changes in Nationally Recognized Statistical Rating Organization (NRSRO) ratings may have on the Bank's investments. These statements may involve matters pertaining to, but not limited to: projections regarding revenue, income, earnings, capital expenditures, dividends, liquidity, the Bank's capital structure, AHP and voluntary housing contributions and other financial items; statements of plans or objectives for future operations; expectations for future economic performance; and statements of assumptions underlying certain of the foregoing types of statements.
The forward-looking statements may not be realized due to a variety of factors, including, but not limited to risks and uncertainties relating to economic, competitive, governmental, technological, housing reform, regulatory changes, various market factors, as well as the risk factors provided under Item 1A of the Bank's Form 10-K, and in the Bank's other filings with the SEC from time to time, and elsewhere in this Report.
All such written or oral statements that are made by or are attributable to the Bank are expressly qualified in their entirety by this cautionary notice. The reader should not place undue reliance on forward-looking statements. Those statements speak only as of the date that they are made and the Bank has no obligation and does not undertake to update, revise, or correct any of the forward-looking statements after the date of this Report, or after the respective dates on which the statements are made, whether as a result of new information, future events, or otherwise, except as required by law.
The discussion presented below provides an analysis of the Bank's financial condition as of September 30, 2026 and December 31, 2025, and results of operations for the third quarter and first nine months of 2026 and 2025. Management's discussion and analysis should be read in conjunction with the financial statements and accompanying notes presented elsewhere in this Report, as well as the Bank's audited financial statements for the year ended December 31, 2025.
Executive Summary
Business Overview
The material factors impacting the Bank's business outlook remain largely unchanged from the discussion in the Bank's Form 10-K. The Bank considers macroeconomic drivers in its strategic planning process and business models. Current volatility and uncertainty in global economic and political conditions may impact the macroeconomic drivers, increase cybersecurity risk and impact on member businesses and operations. Volatility along with external factors such as interest rates, liquidity levels at member institutions, fiscal and monetary policies, and regulatory changes could have a significant effect either positive or negative on the Bank's financial performance.
Financial Condition
The following table presents the Bank's total assets, total liabilities, and total capital (dollars in millions).
Change
As of September 30, 2026 As of December 31, 2025 Amount Percent
Total assets $ 166,744 $ 146,236 $ 20,508 14.02
Total liabilities 157,478 137,615 19,863 14.43
Total capital 9,266 8,621 645 7.48
•Total assets increased primarily due to a $10.2 billion, or 10.8 percent, increase in advances, and a $10.3 billion, or 20.6 percent, increase in total investments. The increase in total investments was primarily due to the Bank holding more liquidity investments as of September 30, 2026.
•Total liabilities increased primarily due to a $20.1 billion, or 15.0 percent, increase in consolidated obligations as a result of increased funding and liquidity needs during the period.
•Total capital increased primarily due to a $498 million increase in advance activity-based capital stock and a $106 million increase in retained earnings.
Results of Operations
The following table presents the Bank's significant income and expense items (dollars in millions).
For the Three Months Ended September 30, Change For the Nine Months Ended September 30, Change
2026 2025 Amount Percent 2026 2025 Amount Percent
Net interest income $ 183 $ 212 $ (29) (13.37) $ 591 $ 631 $ (40) (6.29)
Noninterest income 9 9 - (3.52) 29 19 10 57.36
Noninterest expense 52 49 3 7.39 181 162 19 11.75
Affordable Housing Program assessment 14 17 (3) (18.64) 44 49 (5) (9.78)
Net income $ 126 $ 155 $ (29) (18.68) $ 395 $ 439 $ (44) (9.85)
•For the third quarter of 2026, the decreases in net interest income and net income were primarily due to a decrease in interest rates, which impacted interest-earning assets more than interest-bearing liabilities, and a decrease in average advance balances, partially offset by an increase in average investment balances, compared to the same period in 2025. Additionally, average funding spreads on newly-issued consolidated obligations increased.
•For the first nine months of 2026, the decreases in net interest income and net income were primarily due to a decrease in interest rates, which impacted interest-earning assets more than interest-bearing liabilities. These decreases were partially offset by an increase in average advance and investment balances, compared to the same period in 2025. Additionally, average funding spreads on newly-issued consolidated obligations increased.
The following table presents the Bank's significant income ratios.
For the Three Months Ended September 30, For the Nine Months Ended September 30,
2026 2025 Change 2026 2025 Change
Return on average equity 5.71 % 6.95 % (1.24) 5.80 % 6.73 % (0.93)
Average daily SOFR 3.67 4.33 (0.66) 3.65 4.33 (0.68)
Return on average equity spread to average daily SOFR 2.04 2.62 (0.58) 2.15 2.40 (0.25)
Net yield on interest-earning assets 0.47 0.53 (0.06) 0.49 0.54 (0.05)
•The decrease in return on average equity was primarily due to the decrease in net income for the periods presented.
Financial Condition
The following table presents the distribution of the Bank's total assets, liabilities, and capital (dollars in millions). These items are discussed in more detail below.
As of September 30, 2026 As of December 31, 2025 Change
Amount Percent
of Total 		Amount Percent
of Total 		Amount Percent
Advances $ 105,208 63.10 $ 94,978 64.95 $ 10,230 10.77
Investment securities 34,771 20.85 33,591 22.97 1,180 3.51
Other investments 25,569 15.33 16,458 11.26 9,111 55.36
Mortgage loans held for portfolio, net 69 0.04 77 0.05 (8) (11.11)
Other assets 1,127 0.68 1,132 0.77 (5) (0.41)
Total assets $ 166,744 100.00 $ 146,236 100.00 $ 20,508 14.02
Consolidated obligations, net:
Discount notes $ 38,752 24.61 $ 44,390 32.26 $ (5,638) (12.70)
Bonds 114,974 73.01 89,251 64.85 25,723 28.82
Total consolidated obligations, net 153,726 97.62 133,641 97.11 20,085 15.03
Deposits 2,704 1.72 2,463 1.79 241 9.76
Other liabilities 1,048 0.66 1,511 1.10 (463) (30.61)
Total liabilities $ 157,478 100.00 $ 137,615 100.00 $ 19,863 14.43
Capital stock $ 6,146 66.33 $ 5,607 65.05 $ 539 9.60
Retained earnings 3,100 33.45 2,994 34.72 106 3.54
Accumulated other comprehensive income 20 0.22 20 0.23 - 0.57
Total capital $ 9,266 100.00 $ 8,621 100.00 $ 645 7.48
Advances
Total advances increased by 10.8 percent as of September 30, 2026, compared to December 31, 2025. A significant percentage of advances originated during the first nine months of 2026 were short-term.
As of September 30, 2026, 30.2 percent of the Bank's advances were fixed-rate, compared to 35.1 percent as of December 31, 2025. However, the Bank often simultaneously entered into derivatives with the issuance of advances to convert the rates on them, in effect, into short-term variable interest rates, primarily based on SOFR. As of September 30, 2026 and December 31, 2025, 55.3 percent and 67.9 percent, respectively, of the total Bank's fixed-rate advances were swapped. SOFR-indexed and OIS-indexed advances comprised 71.5 percent and 28.1 percent, respectively, of the Bank's variable-rate advances as of September 30, 2026. The Bank also offers variable-rate advances that may be tied to other indices, such as the federal funds rate, prime rate, or constant maturity swap rates.
The following table presents the par value of outstanding advances by product characteristics (dollars in millions).
As of September 30, 2026 As of December 31, 2025
Amount Percent of Total Amount Percent of Total
Adjustable or variable-rate indexed $ 73,735 69.77 $ 61,733 64.92
Fixed rate (1)
28,645 27.10 28,134 29.58
Convertible 3,311 3.13 5,232 5.50
Total par value $ 105,691 100.00 $ 95,099 100.00
____________
(1)Includes convertible advances whose conversion options have expired.
Refer to Note 3-Advances to the Bank's interim financial statements for the concentration of the Bank's advances to its 10 largest borrowing institutions.
Investments
The following table presents more detailed information regarding investments held by the Bank (dollars in millions).
Change
As of September 30, 2026
As of December 31, 2025 Amount Percent
Available-for-sale securities:
U.S. Treasury obligations $ 5,989 $ 5,594 $ 395 7.04
Mortgage-backed securities:
Government-sponsored enterprises commercial 7,356 3,339 4,017 120.33
Total available-for-sale securities 13,345 8,933 4,412 49.38
Held-to-maturity securities:
State or local housing agency debt obligations 16 1 15 *
Government-sponsored enterprises debt obligations 360 360 - -
Mortgage-backed securities:
U.S. agency obligations-guaranteed residential 1,569 1,876 (307) (16.35)
Government-sponsored enterprises residential 9,345 10,559 (1,214) (11.50)
Government-sponsored enterprises commercial 10,136 11,862 (1,726) (14.55)
Total held-to-maturity mortgage-backed securities: 21,050 24,297 (3,247) (13.36)
Total held-to-maturity securities 21,426 24,658 (3,232) (13.11)
Total investment securities 34,771 33,591 1,180 3.51
Other investments:
Interest-bearing deposits
2,576 2,551 25 0.99
Securities purchased under agreements to resell 12,250 5,500 6,750 122.73
Federal funds sold 10,743 8,407 2,336 27.79
Total other investments 25,569 16,458 9,111 55.36
Total investments $ 60,340 $ 50,049 $ 10,291 20.56
_____________
* Not meaningful
The FHFA regulations prohibit an FHLBank from purchasing MBS and asset-backed securities if its investment in such securities would exceed 300 percent of the FHLBank's previous month-end regulatory capital on the day it would purchase the securities. As of September 30, 2026, these investments were 312 percent of the Bank's regulatory capital. The Bank was in compliance with this regulatory requirement at the time of its MBS purchases and is not required to sell any previously purchased MBS. However, the Bank is precluded from purchasing additional MBS until its MBS to regulatory capital declines below 300 percent.
The amount held in other investments varies each day based on the Bank's liquidity needs as a result of advances demand, the earnings rates, and the availability of high-quality counterparties in the federal funds market.
Consolidated Obligations
The Bank funds its assets primarily through the issuance of consolidated obligation bonds and consolidated obligation discount notes. Consolidated obligation issuances financed 92.2 percent of the $166.7 billion in total assets as of September 30, 2026, a slight increase from the financing ratio of 91.4 percent as of December 31, 2025.
The Bank often simultaneously enters into derivatives with the issuance of fixed-rate consolidated obligation bonds to convert the interest rates, in effect, into short-term variable interest rates, primarily based on SOFR. As of September 30, 2026 and December 31, 2025, 89.2 percent and 92.4 percent, respectively, of the Bank's fixed-rate consolidated obligation bonds were swapped. None of the Bank's variable-rate consolidated obligation bonds were swapped as of September 30, 2026 and December 31, 2025. As of September 30, 2026 and December 31, 2025, 49.0 percent and 89.9 percent, respectively, of the Bank's fixed-rate consolidated obligation discount notes were swapped.
Deposits
The Bank offers demand and overnight deposit programs to members and qualifying non-members primarily as a liquidity management service. In addition, a member that services mortgage loans may deposit funds in the Bank that are collected in connection with the mortgage loans, pending disbursement of those funds. All the Bank's deposits are uninsured. For demand deposits, the Bank pays interest at the overnight rate. Most of these deposits represent member liquidity investments, which members may withdraw on demand. Therefore, the total account balance of the Bank's deposits may fluctuate significantly. As a matter of prudence, the Bank typically invests deposit funds in liquid short-term assets. Member loan demand, deposit flows, and liquidity management strategies influence the amount and volatility of deposit balances carried with the Bank.
Capital
The FHLBank Act and FHFA regulations specify that each FHLBank must meet certain minimum regulatory capital standards. The Bank was in compliance with these regulatory capital rules and requirements as shown in Note 7-Capital to the Bank's interim financial statements.
Additionally, an FHFA Advisory Bulletin sets forth guidance for each FHLBank to maintain a ratio of at least two percent of capital stock to total assets, measured on a daily average basis at month end. As of September 30, 2026, the Bank was in compliance with this ratio.
The Bank's financial management policy and capital plan are discussed in more detail in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations-Financial Condition-Capital and in Note 9 - Capital to the Bank's audited financial statements included in the Bank's Form 10-K.
Results of Operations
The following is a discussion and analysis of the Bank's results of operations.
Net Interest Income
The primary source of the Bank's earnings is net interest income. Net interest income equals interest earned on assets (including advances, mortgage loans, and investments), less the interest expense incurred on liabilities (including consolidated obligations, deposits, and other borrowings). Also included in net interest income are miscellaneous related items such as prepayment fees, the amortization of debt issuance discounts, concession fees, and certain derivative instruments and hedging activities related adjustments.
The following tables present the change in interest income and expense due to volume or rate variance for the third quarter and first nine months of 2026 and 2025 (dollars in millions). The interest-rate spread is affected by the inclusion or exclusion of net interest income or expense associated with the Bank's derivatives. For example, as discussed above, when derivatives qualify for fair-value hedge accounting under GAAP, the interest income or expense associated with the derivatives is included in net interest income and in the calculation of interest-rate spread. When derivatives do not qualify for fair-value hedge accounting under GAAP, the interest income or expense associated with the derivatives is excluded from net interest income and from the calculation of interest-rate spread and is recorded in "Noninterest income (loss)." Amortization associated with hedging-related basis adjustments is also reflected in net interest income, which affects interest-rate spread.
The net yield on interest-earning assets was 47 basis points and 49 basis points for the third quarter and first nine months of 2026, compared to 53 basis points and 54 basis points for the same periods in 2025. The decrease in net interest income during the third quarter of 2026, compared to the same period in 2025, was primarily due to a decrease in interest rates which impacted interest-earning assets more than interest-bearing liabilities and a decrease in average advance balance, partially offset by an increase in average investment balances. The decrease in net interest income during the first nine months of 2026, compared to the same period in 2025, was primarily due to a decrease in interest rates which impacted interest-earning assets more than interest-bearing liabilities, partially offset by increases in average advance and investment balances.
For the Three Months Ended September 30, Change due to
2026 2025
Average Balance Interest Yield/
Rate
(%) 		Average Balance Interest Yield/
Rate
(%)
Volumes
(6)
Rate
(6)
Net Change
Assets
Interest-bearing deposits (1)
$ 3,038 $ 29 3.74 $ 3,174 $ 35 4.39 $ (1) $ (5) $ (6)
Securities purchased under agreements to resell
6,536 61 3.71 5,723 63 4.33 8 (10) (2)
Federal funds sold 15,190 142 3.72 13,872 152 4.35 14 (24) (10)
Investment securities (2)
35,354 374 4.20 33,206 409 4.89 25 (60) (35)
Advances (3)
95,151 963 4.02 102,807 1,205 4.65 (86) (156) (242)
Mortgage loans (4)
70 1 4.89 82 1 5.27 - - -
Loans to other FHLBanks 1 - 3.67 1 - 4.39 - - -
Total interest-earning assets 155,340 1,570 4.01 158,865 1,865 4.66 (40) (255) (295)
Noninterest-earning assets 1,771 1,837
Total assets $ 157,111 $ 160,702
Liabilities and Capital
Interest-bearing deposits (5)
$ 2,454 22 3.59 $ 2,301 24 4.22 2 (4) (2)
Consolidated obligations, net:
Discount notes 34,623 326 3.73 32,457 355 4.34 23 (52) (29)
Bonds 109,565 1,039 3.76 115,084 1,274 4.39 (59) (176) (235)
Other borrowings 21 - 4.20 1 - 6.16 - - -
Total interest-bearing liabilities 146,663 1,387 3.75 149,843 1,653 4.38 (34) (232) (266)
Noninterest-bearing liabilities 1,696 2,014
Total capital 8,752 8,845
Total liabilities and capital $ 157,111 $ 160,702
Interest-rate spread 0.26 0.28
Average interest-earning assets to interest-bearing liabilities
105.92 106.02
Net yield on interest-earning assets (7)
$ 155,340 $ 183 0.47 $ 158,865 $ 212 0.53
Changes in net interest income $ (6) $ (23) $ (29)
For the Nine Months Ended September 30, Change due to
2026 2025
Average Balance Interest Yield/
Rate
(%) 		Average Balance Interest Yield/
Rate
(%)
Volumes
(6)
Rate
(6)
Net Change
Assets
Interest-bearing deposits (1)
$ 3,017 $ 84 3.72 $ 3,119 $ 102 4.39 $ (3) $ (15) $ (18)
Securities purchased under agreements to resell
5,748 159 3.69 5,528 180 4.35 7 (28) (21)
Federal funds sold 15,127 418 3.69 13,386 438 4.38 53 (73) (20)
Investment securities (2)
34,516 1,107 4.29 31,910 1,173 4.91 91 (157) (66)
Advances (3)
103,849 3,080 3.97 101,004 3,506 4.64 96 (522) (426)
Mortgage loans (4)
73 3 5.05 85 3 5.39 - - -
Loans to other FHLBanks 2 - 3.69 - - - - - -
Total interest-earning assets 162,332 4,851 4.00 155,032 5,402 4.66 244 (795) (551)
Noninterest-earning assets 1,883 1,643
Total assets $ 164,215 $ 156,675
Liabilities and Capital
Interest-bearing deposits (5)
$ 2,347 63 3.56 $ 2,230 71 4.24 4 (12) (8)
Consolidated obligations, net:
Discount notes 41,451 1,142 3.68 23,811 772 4.34 501 (131) 370
Bonds 109,497 3,055 3.73 119,924 3,928 4.38 (323) (550) (873)
Other borrowings 15 - 5.06 6 - 5.03 - - -
Total interest-bearing liabilities 153,310 4,260 3.72 145,971 4,771 4.37 182 (693) (511)
Noninterest -bearing liabilities 1,796 1,995
Total capital 9,109 8,709
Total liabilities and capital $ 164,215 $ 156,675
Interest-rate spread 0.28 0.29
Average interest-earning assets to interest-bearing liabilities
105.88 106.21
Net yield on interest-earning assets (7)
$ 162,332 $ 591 0.49 $ 155,032 $ 631 0.54
Changes in net interest income $ 62 $ (102) $ (40)
____________
(1)Includes amounts recognized for the right to reclaim cash collateral paid under master netting agreements with derivative counterparties.
(2)Includes available-for-sale securities at amortized cost basis.
(3) Interest income and average yield include net prepayment fees on advances as detailed in the advance prepayment fees table below.
(4) Nonperforming mortgage loans are included in average balances used to determine average rate.
(5) Includes amounts recognized for the right to return cash collateral received under master netting agreements with derivative counterparties.
(6) Volume change is calculated as the change in volume multiplied by the previous rate, while rate change is calculated as the change in rate multiplied by the previous volume. The rate/volume change, calculated as the change in rate multiplied by the change in volume, is allocated between volume change and rate
change at the ratio each component bears to the absolute value of its total.
(7) Calculated as net interest earnings divided by total-earning assets, with net interest earnings equaling the difference between total interest earned and total
interest paid.
When an advance is prepaid, the Bank could suffer lower future income if the principal portion of the prepaid advance is reinvested in lower-yielding assets. To protect against this risk, the Bank charges a borrower a prepayment fee when the borrower prepays certain advances before the original maturity, which makes the Bank financially indifferent to a borrower's decision to prepay an advance. The Bank records prepayment fees net of basis adjustments, which are primarily related to hedging activities included in the carrying value of the advance, as interest income on advances on the Statements of Income.
The following table presents the components of net advances prepayment fees for the periods presented (dollars in millions):
For the Three Months Ended September 30, For the Nine Months Ended September 30,
2026 2025 2026 2025
Gross amount of prepayment fees received from advance borrowers $ 1 $ 15 $ 9 $ 36
Gross amount of prepayment credits paid to advance borrowers (7) (1) (12) (20)
Hedging fair value adjustments on prepaid advances 6 (5) 16 1
Other 3 (4) 2 (5)
Net advances prepayment fees $ 3 $ 5 $ 15 $ 12
Derivatives and Hedging Activity
As discussed above, net interest income includes components of hedging activity. When hedging relationships qualify for hedge accounting, the interest components of the hedging derivatives will be reflected in interest income or expense. Fair value gains and losses on derivatives and hedged items designated in fair value hedging relationships are also recognized in interest income or interest expense. When a hedging relationship is discontinued, the cumulative fair value adjustment on the hedged item will be amortized into interest income or expense over the remaining life of the asset or liability.
The following tables present the net effect of derivatives and hedging activity on the Bank's results of operations (dollars in millions).
For the Three Months Ended September 30, 2026
Advances Investments Consolidated
Obligation
Bonds 		Total
Effect on net interest income:
Amortization or accretion of active hedging relationships $ 3 $ - $ (28) $ (25)
Net changes in fair value hedges 1 (8) 28 21
Net interest settlements on derivatives (1)
21 (5) (39) (23)
Price alignment amount (2)
(3) (2) - (5)
Amortization or accretion of inactive hedging relationships 1 - (1) -
Total effect on net interest income $ 23 $ (15) $ (40) $ (32)
For the Three Months Ended September 30, 2025
Advances Investments Consolidated
Obligation
Bonds 		Consolidated Obligation Discount Notes Total
Effect on net interest income:
Amortization or accretion of active hedging relationships $ 1 $ - $ (46) $ - $ (45)
Net changes in fair value hedges (1) - 46 - 45
Net interest settlements on derivatives (1)
67 8 (123) (6) (54)
Price alignment amount (2)
(3) 1 - (1) (3)
Amortization or accretion of inactive hedging relationships - - (1) - (1)
Total effect on net interest income $ 64 $ 9 $ (124) $ (7) $ (58)
Effect on Noninterest income:
Gains on derivatives not receiving hedge accounting including net interest settlements - noninterest income $ - $ - $ 1 $ - $ 1
For the Nine Months Ended September 30, 2026
Advances Investments Consolidated
Obligation
Bonds 		Consolidated Obligation Discount Notes Total
Effect on net interest income:
Amortization or accretion of active hedging relationships $ 4 $ - $ (105) $ - $ (101)
Net changes in fair value hedges (2) (10) 107 - 95
Net interest settlements on derivatives (1)
66 (16) (147) 7 (90)
Price alignment amount (2)
(7) (1) (1) - (9)
Amortization or accretion of inactive hedging relationships - - (3) - (3)
Total effect on net interest income $ 61 $ (27) $ (149) $ 7 $ (108)
Effect on noninterest income:
Gains on derivatives not receiving hedge accounting including net interest settlements - noninterest income $ 2 $ - $ - $ - $ 2
For the Nine Months Ended September 30, 2025
Advances Investments Consolidated
Obligation
Bonds 		Consolidated Obligation Discount Notes Total
Effect on net interest income:
Amortization or accretion of active hedging relationships $ 3 $ - $ (166) $ - $ (163)
Net changes in fair value hedges (8) 1 167 - 160
Net interest settlements on derivatives (1)
200 18 (368) 2 (148)
Price alignment amount (2)
(11) 2 (1) (4) (14)
Amortization or accretion of inactive hedging relationships - - (3) - (3)
Total effect on net interest income $ 184 $ 21 $ (371) $ (2) $ (168)
Effect on noninterest income:
Gains on derivatives not receiving hedge accounting including net interest settlements - noninterest income $ - $ - $ 1 $ - $ 1
____________
(1)Represents interest income or expense on derivatives included in net interest income.
(2)This amount is for derivatives for which variation margin is characterized as daily settled contract.
Noninterest Expense and AHP Assessment
The Bank records statutory AHP assessment expense at a rate of 10 percent of income before assessment, excluding interest expense on mandatorily redeemable capital stock.
In addition, the Bank's board of directors authorized $45 million in voluntary contributions for 2026 consisting of $14 million in voluntary AHP contributions and $31 million in voluntary non-AHP contributions. These amounts were expensed during the first nine months of 2026. Refer to Note 6-Affordable Housing Program and Voluntary Contributions to the Bank's interim financial statements for additional information regarding voluntary housing contributions expensed during the reported periods.
Selected Financial Data
The following table presents selected financial data for the periods presented (dollars in millions):
As of and for the Three Months Ended
September 30,
2026 		June 30,
2026 		March 31,
2026 		December 31,
2025 		September 30,
2025
Statements of Condition (at period end)
Total assets $ 166,744 $ 164,985 $ 154,113 $ 146,236 $ 153,864
Advances 105,208 101,404 95,908 94,978 94,167
Investments (1)
60,340 62,266 56,939 50,049 58,400
Mortgage loans held for portfolio, net 69 72 75 77 81
Consolidated obligations, net (2)
153,726 151,872 141,456 133,641 141,554
Total Capital stock Class B putable 6,146 5,956 5,689 5,607 5,560
Retained earnings 3,100 3,073 3,042 2,994 2,930
Accumulated other comprehensive income (loss) 20 24 (3) 20 (1)
Total capital 9,266 9,053 8,728 8,621 8,489
Statements of Income (for the period ended)
Net interest income 183 203 205 226 212
Standby letters of credit fees 8 8 8 8 6
Net income 126 127 142 163 155
Performance Ratios (%)
Return on average equity (3)
5.71 5.41 6.30 7.39 6.95
Return on average assets (4)
0.32 0.30 0.35 0.41 0.38
Net yield on interest-earning assets 0.47 0.48 0.51 0.58 0.53
Interest-rate spread 0.26 0.28 0.31 0.35 0.28
Regulatory capital ratio (at period end) (5)
5.55 5.48 5.67 5.88 5.52
Total average equity to average assets 5.57 5.52 5.55 5.58 5.50
Dividend payout ratio (6)
78.69 75.22 66.44 60.79 63.47
____________
(1) Investments consist of interest-bearing deposits, securities purchased under agreements to resell, federal funds sold, and securities classified as available-for-sale and held-to-maturity.
(2) The amounts presented are the Bank's primary obligations on consolidated obligations outstanding. The par value of the other FHLBanks' outstanding consolidated obligations for which the Bank is jointly and severally liable was as follows (dollars in millions):
September 30, 2026 $ 1,134,461
June 30, 2026 1,178,455
March 31, 2026 1,062,463
December 31, 2025 1,017,701
September 30, 2025 1,041,834
(3) Calculated as net income, divided by average total equity.
(4) Calculated as net income, divided by average total assets.
(5) Regulatory capital ratio is regulatory capital, which does not include accumulated other comprehensive income (loss), but does include mandatorily redeemable capital stock, as a percentage of total assets as of period end.
(6) Calculated as dividends declared during the period divided by net income during the period.
Liquidity and Capital Resources
Liquidity is necessary to satisfy members' borrowing needs on a timely basis, repay maturing and called consolidated obligations, and meet other obligations and operating requirements. Many members rely on the Bank as a source of standby liquidity, so the Bank attempts to be in a position to meet member funding needs on a timely basis. The Bank is required to maintain liquidity in accordance with the FHLBank Act, FHFA regulations, and policies established by the Bank's management and board of directors. In addition, the FHFA, at times, has issued guidance and expectations to the FHLBanks related to liquidity.
Sources of Liquidity.
The Bank's principal source of liquidity is consolidated obligation debt instruments. To provide additional liquidity, the Bank may also use other short-term borrowings, such as federal funds purchased, securities sold under agreements to repurchase, and loans from other FHLBanks. The Bank's consolidated obligations are not obligations of the U.S. and are not guaranteed by either the U.S. or any government agency, but have historically received the same credit rating as the government bond credit
rating of the United States. As a result, the Bank generally has comparatively stable access to funding through a diverse investor base at relatively favorable spreads to U.S. Treasury rates. The Bank's income and liquidity would be adversely affected if it were not able to access the capital markets at competitive rates for an extended period.
The Bank's short-term funding is generally driven by member advance demand and is achieved through the issuance of consolidated discount notes and short-term consolidated bonds. Access to short-term debt markets has been reliable because investors, driven by increased liquidity preferences and risk aversion, have often sought the Bank's short-term debt as an asset of choice.
The Bank is focused on maintaining an adequate liquidity balance and a funding balance between its financial assets and financial liabilities. The Bank monitors the funding balance between financial assets and financial liabilities and is committed to prudent risk management practices. In managing and monitoring the amounts of assets that require refunding, the Bank considers contractual maturities of its financial assets, as well as certain assumptions regarding expected cash flows (i.e., estimated prepayments and scheduled amortizations). External factors including Bank member borrowing needs, supply and demand in the debt markets, and other factors may also affect the liquidity balance and the funding balance between financial assets and financial liabilities.
Contingency plans are in place that prioritize the allocation of liquidity resources in the event of operational disruptions at the Bank or the Office of Finance and extraordinary market events.
Liquidity Reserves for Deposits.
FHFA regulations require the Bank to hold a total amount of obligations of the United States, deposits in eligible banks or trust companies, or advances with maturities not exceeding five years, in an amount not less than the amount of total member deposits. The Bank has complied with this requirement throughout the first nine months of 2026.
Operational Liquidity.
In order to ensure adequate operational liquidity (generally, the ready cash and borrowing capacity available to meet the Bank's intraday needs) each day, Bank policy establishes a daily liquidity target based upon member deposit levels and current day liability maturities and asset settlements. The Bank has met this liquidity requirement throughout the first nine months of 2026.
Additional Liquidity Guidance.
The FHFA issued an Advisory Bulletin on FHLBank liquidity (Liquidity Guidance AB) that communicates the FHFA's expectations with respect to the maintenance of sufficient liquidity to enable the Bank to provide advances and standby letters of credit for members during a sustained capital market disruption, assuming no access to capital markets and assuming renewal of all maturing advances for a period of between ten to thirty calendar days. The FHFA periodically issues supervisory letters that identify thresholds for measures of liquidity within the established ranges set forth in the Liquidity Guidance AB.
The Liquidity Guidance AB's measurements of liquidity include a cash flow scenario, on a daily basis, that projects forward the number of days for which the Bank should maintain positive cash balances assuming the renewal of all maturing advances and the maintenance of a liquidity reserve for outstanding standby letters of credit. The measurements of liquidity also include a funding gap measurement of the difference between assets and liabilities that are scheduled to mature during a specified period, expressed as a percentage of the Bank's total assets to reduce the liquidity risks associated with a mismatch in asset and liability maturities, including an undue reliance on short-term debt funding, which may increase debt rollover risk. The Liquidity Guidance AB permits an FHLBank to temporarily decrease its liquidity position, in a safe and sound manner, below the stated regulatory levels, as necessary for providing unanticipated extensions of advances to members or draws on standby letters of credit to beneficiaries. The Bank has met this liquidity requirement as directed by the FHFA throughout the first nine months of 2026.
Summary of Cash Flows
The following table presents a summary of net cash provided by (used in) the Bank's operating, investing, and financing activities (dollars in millions):
For the Nine Months Ended September 30,
2026 2025
Net cash provided by (used in):
Operating activities $ 948 $ (182)
Investing activities (21,921) (5,447)
Financing activities 20,998 5,672
Net change in cash and due from banks $ 25 $ 43
The primary drivers that can impact net operating cash flows are fluctuations in net income and changes in certain adjustments to net income which may include amortization, accretion, derivative and hedging activities, and other adjustments. Cash flows related to investing and financing activities primarily relate to providing liquidity for various Bank-related activities. The Bank's primary uses of liquidity are advance originations and consolidated obligation payments. Other uses of liquidity are investment purchases and dividends.
Off-balance Sheet Commitments
The Bank's primary off-balance sheet commitments are as follows:
•the Bank's joint and several liability for all FHLBank consolidated obligations; and
•the Bank's outstanding commitments arising from standby letters of credit.
As of September 30, 2026, the FHLBanks had $1,288.8 billion in aggregate par value of consolidated obligations issued and outstanding, $154.3 billion of which was attributable to the Bank. Should an FHLBank be unable to satisfy its payment obligation under a consolidated obligation for which it is the primary obligor, any of the other FHLBanks, including the Bank, can be called upon to repay all or any part of such payment obligation, as determined or approved by the FHFA. No FHLBank has ever defaulted on its principal or interest payments under any consolidated obligation, and the Bank has never been required to make payments under any consolidated obligation because of the failure of another FHLBank to meet its obligations. As of September 30, 2026 and December 31, 2025, the FHFA was not required to allocate any obligation among the FHLBanks and the Bank currently believes the likelihood it would have to pay any amounts beyond those for which it is primarily liable is remote. Accordingly, the Bank has not recognized a liability for its joint and several obligations related to other FHLBanks' consolidated obligations as of September 30, 2026 and December 31, 2025.
The Bank generally requires standby letters of credit to contain language permitting the Bank, upon annual renewal dates and prior notice to the beneficiary, to choose not to renew the standby letter of credit, which effectively terminates the standby letter of credit prior to its scheduled final expiration date. Based on the creditworthiness of the member applicant and appropriate additional fees, the Bank may issue standby letters of credit that have terms longer than one year without annual renewals or that have no stated maturity and are subject to renewal on an annual basis.
Commitments to extend credit, including standby letters of credit, are agreements to lend. The Bank issues a standby letter of credit on behalf of a member in exchange for a fee. A member may use these standby letters of credit to facilitate a financing arrangement. Management regularly reviews its standby letter of credit pricing in light of several factors, including the Bank's potential liquidity needs related to draws on its standby letters of credit. Based on management's credit analyses and collateral requirements, the Bank does not deem it necessary to have an allowance for credit losses for unfunded standby letters of credit as of September 30, 2026.
Refer to Note 11-Commitments and Contingencies to the Bank's interim financial statements for more information about the Bank's outstanding standby letters of credit.
Legislative and Regulatory Developments
The Bank is subject to various legal and regulatory requirements and priorities. Certain actions, regulatory priorities, and areas of focus by the current administration have changed and continue to change the regulatory environment. These changes have affected, and likely will continue to affect, certain aspects of the Bank's business operations, and could affect the financial
condition, results of operations, and reputation of the Bank. Additionally, the Bank is subject to extensive regulation and supervision, including ongoing monitoring and targeted examinations, by our regulator which could affect our business operations and financial results.
Considering the regulatory environment, there is uncertainty with respect to the ultimate result of future regulatory actions and their ultimate impact on the housing market, the Bank and the FHLBank System. The Bank continues to monitor these actions as they evolve and to evaluate their potential impact on the Bank. For a discussion of related risks, please refer to Item 1A Risk Factors in the Bank's Form 10-K.
Risk Management
The Bank has exposure to a number of risks in pursuing its business objectives. These risks may be broadly classified as market, credit, liquidity, operational, and business. Market risk is discussed in Item 3. Quantitative and Qualitative Disclosures about Market Risk. For additional information, see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Management in the Bank's 2025 Form 10-K.
Credit Risk
The Bank faces credit risk primarily with respect to its advances, investments, derivatives, and mortgage loans.
Advances
Secured advances to member financial institutions account for the largest category of Bank assets; thus, advances are a major source of the Bank's credit risk exposure.
The following table presents the number of borrowers and the par value of advances outstanding to borrowers with the specified ratings as of the specified dates (dollars in millions).
As of September 30, 2026 As of December 31, 2025
Rating Number of Borrowers Par Value of Outstanding Advances Number of Borrowers Par Value of Outstanding Advances
1 13 $ 608 19 $ 647
2 65 21,536 65 4,374
3 98 7,990 103 54,532
4 84 60,650 92 20,853
5 24 6,661 31 4,943
6 24 7,545 17 9,156
7 8 207 15 594
8 2 132 - -
9 1 294 - -
10 2 68 - -
Total 321 $ 105,691 342 $ 95,099
The following table presents information about the types of collateral held for the Bank's advances (dollars in millions).
Total Par
Value of
Outstanding Advances 		LCV of
Collateral
Pledged by Members 		First Mortgage
Collateral (%) 		Securities
Collateral (%) 		Other Real Estate Related Collateral (%)
As of September 30, 2026 $ 105,691 $ 440,654 60.11 16.76 23.13
As of December 31, 2025 95,099 431,730 60.89 17.75 21.36
Investments
The Bank is subject to credit risk on investments consisting of investment securities, interest-bearing deposits, securities purchased under agreements to resell, and federal funds sold.
The following table presents the Bank's investments as of September 30, 2026 (dollars in millions), based on the lowest long-term credit ratings assigned by an NRSRO as of that date.
Carrying Value as of September 30, 2026
Investment Grade
AAA AA A BBB Total
Investment securities:
U.S. Treasury obligations
$ - $ 5,989 $ - $ - $ 5,989
State or local housing agency debt obligations
15 1 - - 16
Government-sponsored enterprises debt obligations
- 360 - - 360
Mortgage-backed securities:
U.S. agency obligations-guaranteed residential - 1,569 - - 1,569
Government-sponsored enterprises residential - 9,345 - - 9,345
Government-sponsored enterprises commercial 381 17,111 - - 17,492
Total mortgage-backed securities
381 28,025 - - 28,406
Total investment securities
396 34,375 - - 34,771
Other investments:
Interest-bearing deposits - 979 1,597 - 2,576
Securities purchased under agreements to resell - 6,250 4,000 2,000 12,250
Federal funds sold - 6,068 4,185 490 10,743
Total other investments - 13,297 9,782 2,490 25,569
Total investments $ 396 $ 47,672 $ 9,782 $ 2,490 $ 60,340
The following tables present the Bank's unsecured investment credit, by instrument type, according to the location of the parent company of the counterparty (dollars in millions).
As of September 30, 2026
Federal Funds Sold
Interest-bearing Deposits
Total
Australia $ 1,850 $ - $ 1,850
Canada 1,558 - 1,558
France 2,000 - 2,000
Germany 2,500 - 2,500
Sweden 2,050 - 2,050
United States of America 785 2,576 3,361
Total $ 10,743 $ 2,576 $ 13,319
As of September 30, 2026, the total unsecured credit portfolio consisted primarily of federal funds sold with overnight maturities. Australia & New Zealand Banking Group Limited (Australia) and Skandinaviska Enskilda Banken AB (Sweden) were the only counterparties that individually had greater than 10 percent of the Bank's total unsecured credit exposure; in total, they represented 22.1 percent.
Derivatives
The Bank is subject to credit risk due to the risk of nonperformance by counterparties to its derivative transactions. The amount of credit risk on derivatives depends on the extent to which netting procedures, collateral requirements, and other credit enhancements are used and are effective in mitigating the risk. The Bank manages credit risk through credit analysis, collateral management, and other credit enhancements. The Bank is also required to follow the requirements set forth by applicable regulations.
The following table presents the derivative positions with counterparties to which the Bank had credit exposure as of September 30, 2026 (dollars in millions). The credit ratings reflect the lowest long-term credit rating by an NRSRO.
As of September 30, 2026
Notional Amount Net Derivatives Fair Value Before Collateral Cash Collateral Pledged To (From) Counterparty Net Credit Exposure to Counterparties
Counterparties:
Asset positions with credit exposure:
Single-A
$ 18,338 $ 256 $ (247) $ 9
Cleared derivatives
43,747 7 326 333
Liability positions with credit exposure:
Double-A 1,125 (3) 3 -
Single-A 4,673 (44) 45 1
Total derivative positions with counterparties to which
the Bank had credit exposure 		$ 67,883 $ 216 $ 127 $ 343
Mortgage Loans
The credit risk exposure related to mortgage loans is minimal, as described in Item 8, Financial Statements and Supplementary Data-Note 2, Summary of Significant Accounting Policies, in the Bank's Form 10-K.
Critical Accounting Estimates
A detailed description of the Bank's critical accounting estimates is contained in the Bank's Form 10-K. There have been no material changes to these estimates during the periods presented.
Recently Issued But Not Yet Adopted Accounting Guidance
See Note 1-Basis of Presentation to the Bank's interim financial statements for a discussion of recently issued but not yet adopted accounting standards.
Federal Home Loan Bank of Atlanta published this content on November 05, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on November 05, 2026 at 16:58 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]