Purpose

In accordance with the regulatory requirements of the Federal Housing Finance Board (12 CFR §915.11), the Board of Directors of the Federal Home Loan Bank of Cincinnati (FHLBank) has adopted this Conflict of Interest Policy (Policy) for its Directors.

Administration and Monitoring

This Policy will be periodically reviewed and updated by the FHLBank's Board of Directors (collectively the "Board," and any member of the Board, whether elected or appointed, a "Director").

Interpretation of this Policy is the responsibility of the Personnel Committee of the Board. The Audit Committee of the Board will be responsible for monitoring compliance with this Policy. The FHLBank's President (or his designee) will administer this Policy.

Definitions

The following definitions will be used in the interpretation and application of this Policy:

Fair Administration

Each Director shall administer the affairs of the FHLBank fairly and impartially and without discrimination in favor of or against any Member or non-member borrower.

Confidential Information

A Director shall not disclose or use confidential information received by reason of the Director’s position with the FHLBank to obtain a Financial Interest or business advantage for himself or herself or for any other person or entity.

Prohibited and Permitted Activities and Interests

A Director shall avoid appearing on both sides of a transaction; such actions will make it difficult for the Director to perform objectively and effectively for the FHLBank. This prohibition does not preclude business transactions, otherwise consistent with this Policy, between the FHLBank and a Member of which the Director is an officer, director or shareholder, or a Member of whose affiliate the Director is an officer, director or shareholder.

A Director is prohibited from using his or her official position for personal gain. A Director shall not accept, and shall discourage his or her Immediate Family Members from accepting, any Substantial Gift where the Director has reason to believe that the gift is given in order to influence the Director's actions as a member of the Board, or where acceptance of such gift gives the appearance of influencing the Director's actions as a member of the Board. Further, no Director shall order or attempt to order, direct or coerce any FHLBank employee to engage in or recruit others to engage in any political fund-raising activity or to contribute to any political candidate, or state or suggest that it is part of the official duties of any such employee to do so.

Appointive Directors are prohibited from serving as an officer of any other Federal Home Loan Bank or as an officer or director of any Member. However, an Appointive Director may serve as an officer or director of a holding company which controls one or more Members so long as the assets of all such Members constitute and continue to constitute less than 35 percent of the consolidated assets of the holding company.

Except as provided below, Appointive Directors are prohibited from owning any debt or equity securities issued by a Member or from having any other Financial Interest in a Member. Further, any debt or equity securities of a Member owned by an Appointive Director’s spouse or minor children will be attributed to the Director.

An Appointive Director may invest in a legally recognized entity which owns debt or equity securities issued by a Member so long as the Director neither controls the entity nor plays any role in the purchase or sale of the securities owned by the entity.

An Appointive Director may own debt or equity securities in a Member through an account managed by an investment advisor registered under the Investment Advisers Act of 1940, as amended for which the Director pays a fee for such advisory services and with respect to which the Director has given the investment advisor complete investment discretion for all securities in the account, so long as the Director is not affiliated with the investment advisor and has no control over the selection of securities acquired for the account.

An Appointive Director may also own the debt or equity securities in a holding company which controls one or more Members of the FHLBank so long as the assets of all such Members constitute and continue to constitute less than 35 percent of the consolidated assets of the holding company.

An Appointive Director may have a contractual relationship with one or more Members (including a contractual right to the payment of money), so long as the amounts due under such contracts total less than ten percent (10%) of the Director’s adjusted gross income for the calendar year. Additionally, any contractual relationships between and moneys due the spouse of an Appointive Director and a Member will be attributed to the Director.

Compensation

A Director shall not accept compensation for services performed for the FHLBank from any source other than the FHLBank.

Affordable Housing Program ("AHP") Applications

A Director shall not participate in or attempt to influence decisions by the FHLBank regarding the evaluation, approval, funding, monitoring, or any remedial process for an AHP application or project in which the Director or an Immediate Family Member of the Director has a Financial Interest or where the Director is a director, trustee, officer, or employee of or has any Financial Interest in an organization involved in a project that is the subject of a pending or approved AHP application.

Election of Directors

When acting in a personal capacity, an incumbent Director may support the nomination or election of a particular individual (or group of individuals) for an elective directorship. The incumbent Director is free to express his or her personal views concerning the qualifications of a prospective candidate.

However, an incumbent Director may not use his or her official capacity as a member of the Board to express or convey, either directly or indirectly, that he/she represents the views of the FHLBank, the Finance Board, any other Director, or any officer, attorney, employee, or agent of the FHLBank or of the Finance Board concerning the nomination or election of a particular individual for an elective directorship or take any other action to influence votes for a directorship.

Disclosure and Recusal

A Director shall in good faith fully disclose to the Board as soon as possible each instance of actual or apparent conflict of interest.

The Director shall disclose any personal Financial Interest(s) that he or she has, as well as any Financial Interest(s) known to the Director of any Immediate Family Member or Business Associate of the Director, in any matter to be considered by the Board and in any other matter in which another person or entity does, or proposes to do, business with the FHLBank. Even though a Financial Interest may be permitted for an Appointive Director, such Financial Interest is nevertheless subject to disclosure hereunder.

A Director shall refrain from considering or voting on any issue in which the Director, any Immediate Family Member, or any Business Associate has a Financial Interest.

Procedure for Disclosing and Resolving Conflicts

Where a Director, other than the Chair of the Board (the "Chair"), has a disclosure concerning a Financial Interest or any actual or possible conflict of interest or other violation of this Policy, that information must be disclosed in a written report submitted in a timely manner to the Chair on behalf of the Board. The report shall fully disclose the nature of his or her interest in the matter along with any information that the Chair requests or may need to aid in the consideration of the Director’s interest.

The Chair, when appropriate, will make the necessary investigation to determine if the conflict or violation can be resolved. At his or her discretion, the Chair may consult with other Board members, FHLBank staff, or FHLBank counsel to assist in making such determination. Until the conflict or violation is resolved, the Chair will ensure that the affected Director takes no part in the consideration of or voting on any matter before the Board for which a possible conflict exists.

When the Chair has a disclosure concerning an actual or possible conflict of his or her own interest or other violation of this Policy, that information must be submitted to the Vice Chair, who will make the necessary investigation and determinations (as provided above) to resolve the matter. If the matter is not resolved, the Vice Chair will preside over the consideration and voting of any issues for which a conflict for the Chair may exist.

Certification of Compliance

This Policy will be given to each Director every year and is incorporated by reference in the Finance Board's annual Director eligibility certification process. Additionally, each Director must annually certify his or her compliance with the standards established in this Policy. The FHLBank will maintain the signed certifications in each Director's file.

As required annually by the Finance Board, on or before the FHLBank's February Board meeting of each year, each Director shall submit an executed Director Eligibility Certification Form to the FHLBank. Completed Eligibility Certification Forms are to be submitted to the FHLBank's President (or his designee) who will report to the Chair the status of such certifications by March 1st of each year.

Director Questionnaires

Each Director shall submit an executed Director Questionnaire on or before the FHLBank’s February Board meeting of each year. The Director Questionnaire shall require, among other items, that the Director provide a list of relevant Financial Interests, activities, and associations that potentially could involve actual or possible conflicts of interest with an obligation to update such list if changes occur. Completed Director Questionnaires are to be submitted to the FHLBank’s President (or his designee) who will report to the Chair the status of such questionnaires by March 1st of each year.

Amended: July 19, 2007