The Federal Home Loan Bank of New York is boosting its dividend to 8.05% after experiencing a 23% surge in borrowings in the third quarter.Members of the New York FHLBank increased their borrowings by $6.5 billion in August, when the subprime meltdown finally hit Wall Street and sparked a credit crunch. Members borrowed another $8 billion in advances in September. As of Sept. 30, the New York bank had $75.1 billion in outstanding advances, up 27% from the level at the start of the year. Over 70% of member banks and thrifts turned to the FHLBank's advance window this year. "This significant increase in advances demonstrates the important role we play as we help members serve their communities regardless of the economic environment. Critics, who have forgotten the importance of the assured liquidity mission of the Home Loan Banks, now have a mnemonic," NY FHLBank president Alfred DelliBovi said. The bank paid a 7.5% dividend in the second quarter.

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