A system of regional banks available to assist local American lending
institutions when the need to borrow funds arises. These banks are used to
finance a variety of things, such as infrastructure, housing, and economic
development. FHLBs are actually cooperatives, which enables their low costs to
be passed on to customers. Used by a majority of American lending institutions,
FHLBs have been around for decades, providing low-cost funds for community
lending.