Indices Overview

Index

Reaction to Market

These indexes are the weekly or monthly average yields on U.S. Treasury Securities adjusted to constant maturities.

• Volatile and moves with the market

• Reflects the state of the economy and responds quickly to economic changes

These indexes are based on the results of auctions that the U.S. Treasury holds for its Treasury bills, notes and bonds. Treasury bills are issued by U.S. government with maturities of 3, 6 months, and one year in order to pay for the national debt and other expenses.

• Moves with the market and responds quickly to economic changes

This index is the 12 month average of the monthly average yields of U.S. Treasury securities adjusted to a constant maturity of one year. It is calculated by averaging the previous 12 monthly values of the 1-year CMT.

• More steady than the 1-year CMT index

• Fluctuates slightly more than the 11th District COFI

The index reflects the weighted average interest rate paid by 11th Federal Home Loan Bank District savings institutions for savings and checking accounts, advances from the FHLB, and other sources of funds. The largest part of the Cost of Funds index is the interest paid on savings accounts.

• Lags market interest rates in both up trend and downtrend movements

• ARMs tied to this index rise and fall more slowly than rates in general.

This index is an average of the interest rate on dollar denominated deposits, also known as Eurodollars, traded between banks in London. The LIBOR is an international index that follows the world economic conditions.

• Aggressive initial rates

• Competitive with the 11th District Cost of Funds, 6-month Treasury Bill. and the 6-month Certificated of Deposit

• Borrowers are protected from wide fluctuations in interest rates by periodic and lifetime interest rate caps

These indexes are the averages of the secondary market interest rates on nationally traded Certificates of Deposit. They are usually issued by banks and other financial institutions. The pay a fixed rate of interest for a specific period of time.

• Volatile and reacts quickly to changes in the market

The interest rate charged by banks for short term loans to their most credit worthy customers whose credit standing is so high that little risk to the lender is involved. This tends to be the lowest going rate.

• Not a very volatile index

• Rises quickly but declines slowly

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