INDIANAPOLIS, April 25, 2024 (GLOBE NEWSWIRE) -- Today the Board of Directors of the Federal Home Loan Bank of Indianapolis ("FHLBank Indianapolis" or "Bank") declared its first quarter 2024 dividends on Class B-2 activity-based capital stock and Class B-1 non-activity-based stock at annualized rates of 9.50% and 4.50%, respectively. The higher dividend rate on activity-based stock reflects the Board's discretion under the Bank's capital plan to reward members that use FHLBank Indianapolis in support of their liquidity needs. The dividends will be paid in cash on April 26, 2024. Earnings Highlights Net income, for the first quarter of 2024, was $95 million, an increase of $3 million compared to the corresponding quarter in the prior year. The increase was primarily due to higher earnings on the portion of the Bank's assets funded by its capital1, driven substantially by the increase in market interest rates. However, such increase was substantially offset by net gains on the extinguishment of consolidated obligations in the corresponding quarter that did not occur in the current quarter. Affordable Housing Program Allocation The Bank's Affordable Housing Program ("AHP") provides grant funding to support housing for low- and moderate-income families in communities served by its Michigan and Indiana members. Full-year 2024 AHP allocations will be available to the Bank's members in 2025 to help address their communities' affordable housing needs, including construction, rehabilitation, accessibility improvements and homebuyer down-payment assistance. _____________________________ 1  FHLBank Indianapolis earns interest income on advances to and mortgage loans purchased from its Michigan and Indiana member financial institutions, as well as on long- and short-term investments. Net interest income is primarily determined by the size of the Bank's balance sheet and the spread between the interest earned on its assets and the interest cost of funding with consolidated obligations. Because of the Bank's inherent relatively low interest-rate spread, it has historically derived a substantial portion of its net interest income from deploying its interest-free capital in floating-rate assets. For the three months ended March 31, 2024, AHP assessments2 totaled $11 million. In addition, as part of the Bank's commitment to allocate voluntary funding in 2024 of 5% of its net earnings for 2023 to further support its AHP and additional affordable housing, small business and community investment programs, the Bank voluntarily allocated $4 million, which is reported in other expenses. As a result, the Bank's combined required and voluntary allocation for the three-month period totaled $15 million, an increase of $1 million, or 8%, compared to the corresponding period in the prior year. Condensed Statements of Income The following table presents unaudited condensed statements of income ($ amounts in millions):   Three Months EndedMarch 31,   2024   2023 Interest income(a) $ 1,016   $ 819 Interest expense(a)   887     715 Provision for credit losses   —     — Net interest income after provision for credit losses   129     104 Other income(b)   9     30 Other expenses   32     31 AHP assessments   11     11         Net income $ 95   $ 92 (a) Includes hedging gains (losses) and net interest settlements on fair-value hedge relationships. The Bank uses derivatives, specifically interest-rate swaps, to hedge the risk of changes in the fair value of certain of its advances, available-for-sale securities and consolidated obligations. These derivatives are designated as fair-value hedges and, therefore, changes in the estimated fair value of the derivative, and changes in the fair value of the hedged item that are attributable to the hedged risk, are recorded in net interest income. (b) Includes impact of purchase discount (premium) recorded through mark-to-market gains (losses) on trading securities and net interest settlements on derivatives hedging trading securities, while generally offsetting interest income on trading securities is included in interest income. Balance Sheet Highlights Total assets, at March 31, 2024, were $71.4 billion, a net decrease of $5.2 billion, or 7%, from December 31, 2023, primarily due to decreases in investments. Advances 3 Advances outstanding, at March 31, 2024, at carrying value, totaled $35.3 billion, a net decrease of $265 million, or 1%, from December 31, 2023. The par value of advances outstanding decreased by 0.1% to $35.8 billion, which included a net decrease in short-term advances of 5% and a net increase in long-term advances of 1%. At March 31, 2024, long-term advances composed 74% of advances outstanding, while short-term advances composed 26%. _____________________________ 2  Each year, Federal Home Loan Banks are required to allocate to the AHP 10% of earnings, ...