day  of  each  month.    COFI  is  designed  to  represent  the  monthly  weighted  average  cost  of  funds  for  savings institutions in the Eleventh District (which consists of Arizona, California and Nevada) for the month prior to the month of publication.  The FHLB of San Francisco computes COFI for each month by first dividing the cost of funds (that is, interest paid during the month by Eleventh District savings institutions on savings, advances and other borrowings) by the average of the total amount of these funds outstanding at the end of that month and the prior month and second annualizing and adjusting the result to reflect the actual number of days in the particular month.   If  necessary,  before  these  calculations  are  made,  the  FHLB  of  San  Francisco  adjusts  the  component  figures  to neutralize  the  effect  of  events  such  as  member  institutions  leaving  the  Eleventh  District  or  acquiring  institutions outside the Eleventh District.  COFI has been reported each month since August 1981. The FHLB of San Francisco has stated that it intends COFI to reflect the interest costs paid on all types of funds held by Eleventh District member savings associations and savings banks.  COFI is weighted to reflect the relative amount of each type of funds held at the end of the relevant month.  There are three major components of funds of Eleventh District member institutions: (i) savings deposits, (ii) Federal Home Loan Bank advances and (iii) all other borrowings, such as reverse repurchase agreements and mortgage-backed bonds.  Unlike most other interest rate  measures,  COFI  does  not  necessarily  reflect  current  market  rates  because  the  component  funds  represent  a variety of terms to maturity whose costs may react in different ways to changing conditions.  The FHLB of San Francisco  periodically  prepares  percentage  breakdowns  of  the  types  of  funds  held  by  Eleventh  District  member institutions.  Investors can obtain these breakdowns from the FHLB of San Francisco. A number of factors affect the performance of COFI, which may cause COFI to move in a manner different from indices tied to specific interest rates, such as LIBOR or any Treasury Index.  Because of the various terms to maturity of the liabilities upon which COFI is based, COFI may not necessarily reflect the average prevailing market interest rates on new liabilities of similar maturities.  Additionally, COFI may not necessarily  move in the same direction as market interest rates at all times because as longer term deposits or borrowings mature and are renewed at prevailing market interest rates, COFI is influenced by the differential between the prior and the new rates on those deposits or borrowings.  Moreover, as stated above, COFI is designed to represent the average cost of funds for Eleventh District savings institutions for the month prior to the month in which COFI is published.  Because COFI is based on a regional and not a national cost of funds, it may not behave as would a nationally based index.   In addition, the movement of COFI, as compared to other indices tied to specific interest rates, may be affected by changes instituted by the FHLB of San Francisco in the method used to calculate COFI.  Investors can order an informational brochure explaining COFI by writing or calling the FHLB of San Francisco’s Marketing Department, P.O. Box 7948, San Francisco, California 94120, phone 415/616-2610.  The current level of COFI can be obtained by calling the FHLB of San Francisco at 415/616-2600. If the FHLB of San Francisco fails to publish COFI for a period of 65 calendar days (an event that will constitute an “Alternative Rate Event”), then the Trustee (or its agent) will calculate the Interest Rates of the COFI Classes for the subsequent Accrual Periods by using, in place of COFI, (i) the replacement index, if any, that the FHLB of San Francisco publishes or designates or (ii) if the FHLB of San Francisco does not publish or designate a replacement index, an alternative index selected by the Trustee (or its agent) and approved by Ginnie Mae that has performed, or that the Trustee expects to perform, in a manner substantially similar to COFI.  At the time that the Trustee first selects an alternative index, the Trustee will determine the average number of basis points, if any, by which the alternative index differed from COFI for whatever period the Trustee, in its sole discretion, reasonably determines  to reflect  fairly  the  long-term  difference between  COFI  and  the  alternative  index,  and will  adjust  the alternative index by that average.  The Trustee (or its agent) will select a particular index as the alternative index only if it receives an Opinion of Counsel that the selection of that index will not cause the related Trust REMIC or Trust REMICs to lose their status as REMICs for federal income tax purposes. If  at  any  time  after  the  occurrence  of  an  Alternative  Rate  Event,  the  FHLB  of  San  Francisco  resumes publication of COFI, the Interest Rates of the COFI Classes for each subsequent Accrual Period will be calculated by reference to COFI. Determination of the Treasury Index Unless otherwise provided in the applicable Offering Circular Supplement, the Trustee (or its agent) will calculate the Interest Rates of Treasury Index Classes for each Accrual Period (after the first) on the Floating Rate Base Offering Circular - Single Family 9 RICHMOND 649290v15