11th District Cost of Funds Climbs Again

The 11th District cost of funds--the rate to which many adjustable-rate home mortgage loans are tied--rose again in August to 5.509% from 5.456% in July, the Federal Home Loan Bank of San Francisco reported. The rate, which tends to lag behind changes in market interest rates by several months, has been rising steadily for more than a year and now stands at its highest level since March 1992, when it was 5.611%. The rate, which stood at 4.562% in August 1999, measures the average cost of funds for savings institutions in the federal bank system’s 11th District, which includes California, Arizona and Nevada.