While retail workers like those at Apollo-owned Cardenas Markets face a housing crisis, Apollo-owned Athene is using the Federal Home Loan Bank of Des Moines to boost its investment income.
Federal Home Loan Banks enjoy a government subsidy valued at $6.9 billion annually.[1] These banks were originally founded to support affordable housing. Today, they predominantly serve as a government sponsored piggy bank for financial companies like Apollo.
Apollo exemplifies what’s wrong with the FHLB System.
On one side of its business, Apollo owns Cardenas Markets, whose workers struggle to afford housing.
On the other side, Apollo owns Athene Annuity & Life, the largest borrower from the Federal Home Loan Bank of Des Moines and the seventh largest borrower in the FHLB System at year end 2024.[2]
Athene has $15.6 billion outstanding in government-subsidized loans from FHLB of Des Moines as of December 31, 2024.[3] Athene borrowed from this FHLB in “an investment spread strategy,” according to Apollo.[4] That simply means borrowing at lower rates and reinvesting at higher rates to make a profit.
Retail workers need Federal Home Loan Banks to address the crisis in housing costs, not use its government subsidy to enrich big financial companies like Apollo.
Regulator FHFA is proposing to update Federal Home Loan Banks by reconnecting them more closely to their housing mission. We agree, so we joined with community organizations to propose strict rules to ensure that the $1.3 trillion FHLB System uses its vast resources to tackle our national housing crisis, instead of boosting private profit.
News:
The Economist The American government’s accidental private-credit subsidy: How a Depression-era lending scheme became a trillion-dollar wheeze, 4/2/2025
The Lever The Looting Of America’s Affordable Housing Fund: Private equity firms are diverting billions from a Great Depression-era mortgage program — and making huge profits, 3/5/2025
Resources:
- Coalition for FHLB Reform
- UFCW Comment Letter re: FHLB Mission, 7/15/2024
- Coalition for FHLB Reform Comment Letter re: FHLB Mission, 7/15/2024
- Community Organizations re: Insurance Use of FHLB Comment Letter, 7/15/2024
- UFCW Comment Letter FHLB Roundtables, 10/31/2022
- FHFA FHLBank System at 100 review
[1] https://www.cbo.gov/system/files/2024-03/59712-FHLB.pdf
[2] Federal Home Loan Banks Combined Financial Report, December 30, 2024, p. 64-5 https://www.fhlb-of.com/ofweb_userWeb/resources/2024Q4CFR.pdf
[3] Apollo Global Management, SEC Form 10-Q, 12/31/2024, p. 110. https://www.sec.gov/ix?doc=/Archives/edgar/data/1858681/000185868124000120/apo-20240930.htm
[4] Apollo Global Management, SEC Form 10-Q, 12/31/2024, p. 110. https://www.sec.gov/ix?doc=/Archives/edgar/data/1858681/000185868124000120/apo-20240930.htm