The Federal Home Loan Bank of Topeka announced on September 25, 2026, that its board of directors has approved dividend rates for the quarter ending September 30, 2026. The announcement details specific dividend percentages for the bank's two classes of membership capital stock.
Dividend Rates
- Class A Common Stock: 3.75 percent per annum.
- Class B Common Stock: 9.25 percent per annum.
The dividends on both classes of stock are payable in the form of Class B Common Stock and will be credited to member institutions' capital stock accounts at the close of business on September 30, 2026. Partial shares will be paid in cash and credited to the institution's demand deposit account on that date.
Member Value Analysis
The announcement includes a breakdown of the incremental benefit of the Class B dividend across the bank's three main products: advances, the Mortgage Partnership Finance (MPF) Program, and letters of credit. The Class B dividend rate applies to all three products, resulting in an incremental benefit of 0.25 percent for advances, 0.17 percent for the MPF Program, and 0.01 percent for letters of credit.
Future Outlook
The filing notes that the average interest on reserve balances (IORB) for the third quarter of 2026 was 3.67 percent. Based on current market expectations for short-term interest rates, FHLBank Topeka anticipates paying dividend rates between 3.75 and 4.25 percent for Class A and 9.00 to 9.50 percent for Class B during the fourth quarter of 2026. The bank cautions that adverse changes in financial results may result in lower dividend rates in future quarters than currently anticipated.
