Base Offering Circular - Multifamily 482090 7 (ii) If  on  any  Floating  Rate  Adjustment  Date  only  one  or  none  of  the Reference Banks provides these offered quotations, LIBOR for the next Accrual Period will be whichever is the higher of (x) LIBOR as determined on the previous Floating Rate Adjustment Date and (y) the Reserve Interest Rate. (iii) If  on  any  Floating  Rate  Adjustment  Date  the  Trustee  is  required  but  is unable to determine the Reserve Interest Rate, LIBOR for the next Accrual Period will be LIBOR as determined on the previous Floating Rate Adjustment Date, or, in the case of the first Floating Rate Adjustment Date, the level of LIBOR used to calculate the initial Interest Rate of the particular LIBOR Class. Determination of COFI Unless otherwise provided in the applicable Offering Circular Supplement, the Trustee (or its agent) will calculate the Interest Rates of COFI Classes for each Accrual Period (after the first) on the related Floating Rate Adjustment Date by reference to COFI as published most recently by the Federal Home Loan Bank of San Francisco (the “FHLB of San Francisco”). The FHLB of San Francisco currently publishes COFI on or about its last working 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