EXHIBIT 10.1

FHLBank San Francisco

2009 EXECUTIVE INCENTIVE PLAN

PLAN PURPOSE

To optimize individual and Bank performance in accomplishing Board-approved
goals and objectives.

PLAN OBJECTIVES

To motivate Bank executives to exceed individual and Bank goals that support the
business plan and long-term strategic plan. To attract and retain outstanding
executives by providing a competitive total compensation program, including an
annual incentive award opportunity.

ELIGIBILITY

Participants are Bank executives whose performance has a major impact on the
Bank’s success. The 2009 participants are the incumbents in the Bank’s executive
officer positions, including:

Executive Vice President

Senior Vice President (excluding the Senior Vice President, Enterprise Risk
Management & Director of Internal Audit – participates in the Audit Executive
Incentive Plan)

Participants must be employed by the Bank through December 31st to be eligible
for an incentive award under the 2009 plan. Participants hired, promoted, or who
have a leave of absence during the plan year are eligible to participate on a
pro-rata basis. Participants hired or promoted on or after October 1st will not
be eligible to participate during the current plan year.

INCENTIVE GOALS AND MEASURES

Incentive Goals

For each participant there are individual goals and Bank goals, which are
weighted for each participant. The individual goals support the Bank-wide goals
and objectives.

The four Bank goals for 2009 are:

 

1. 2009 Risk Management Goal: Enhance the financial and credit risk management,
internal controls, and financial reporting frameworks to better align them with
an extended period of housing and mortgage market distress that may lead to
member failures and credit stress in the Bank’s MBS portfolio, and to meet the
best practices operating strategy of the Bank.

 

2. 2009 Potential Dividend Spread Goal: Target Potential Dividend Spread of 250
basis points.

 

3. 2009 Community Investment Goal: Effectively execute community investment
programs and initiatives.

 

4. 2009 Advances Volume Goal: Achieve a target advances volume of $[*] average
daily balance.

An outline of the Bank and individual goal weights and measures is attached as
Exhibit A.

Actual achievement of Bank goals is subject to adjustment for changes resulting
from movements in interest rates, changes in financial strategies or policies,
any significant change in Bank membership, as well as other factors determined
by the Board.

Incentive Goal Achievement Measures

The plan rewards levels of goal achievement, as follows:

 

Achievement Level    Measure Definition

200% of target

   The most optimistic achievement level that far exceeds levels forecasted from
expected business.

 

[*] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portion.

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150% of target    An optimistic achievement level that exceeds levels forecasted
from expected business. Target (100%)    Performance that is expected under the
Bank’s Plan. Threshold (75% of target)    Minimum level of performance that must
be achieved for awards to be paid.

The percentages above represent aggregated achievement levels, not percentages
of base pay.

INCENTIVE AWARD POOL

The Board approves an incentive award pool for the Bank’s executive officers at
the beginning of the plan period. Portions of the pool may be allocated to plan
participants at the end of the plan period based upon their overall goal
achievement levels. The President and the Board of Directors have full
discretion to modify any and all incentive payments.

AWARD DETERMINATION

Awards will be based on success in achieving individual and Bank goals. In the
case of the four Bank goals, the same achievement levels apply to all
participants. At yearend, accomplishments will be assessed and a percentage of
achievement will be determined for each goal and any award determination will be
at the discretion of the Board.

 

Percentage of Achievement Scale      Achievement Levels

0% - 200%

     200%    = Far Exceeds Target      150%    = Exceeds Target      100%    =
Target      75-99%    = Threshold

For each goal, the percentage of achievement will be multiplied by the
applicable goal weights. Each weighted achievement will then be added to
determine the total weighted achievement. The basis for award opportunity is
total weighted achievement. Performance from 75-99% (threshold level) is below
the target achievement level and, therefore, may result in an award less than
one granted for achieving the target level. Performance below the threshold
achievement level normally will not result in an incentive award. The President
and the Board of Directors have full discretion to modify any and all incentive
payments.

APPROVAL OF INCENTIVE AWARDS

All incentive awards must be approved by the President and the Board of
Directors prior to payment. The Board of Directors has the discretion to approve
awards for achievement below 75% total weighted achievement. Award
recommendations will be considered by the Board of Directors at the January 2010
Board meeting or as soon thereafter as reasonably practicable.

PLAN ADMINISTRATION AND IMPLEMENTATION

The President is responsible for overseeing the administration and
interpretation of the Plan.

Payments under this plan are subject to approval by the Board of Directors. Any
awards will be distributed as soon as administratively possible following the
effective date of Board approval. All compensation and incentive plans are
subject to review and revision at the Bank’s discretion. Such plans are reviewed
regularly to ensure they are competitive and equitable. Executive Officer
compensation and benefit programs are subject to Federal Housing Finance Agency
review and oversight, and payments made under such programs may be subject to
the Agency’s approval under applicable laws and regulations in effect from time
to time.

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EXHIBIT A

2009 Risk Management Goal [Segment Weight = 50%]

Qualitative assessment at yearend by Board of Directors.

2009 Potential Dividend Spread Goal

 

Segment

Weight

   

75% Goal

Achievement

Measure

   

100% Goal

Achievement

Measure

   

150% Goal

Achievement

Measure

   

200% Goal

Achievement

Measure

  25 %    2.00 %    2.50 %    3.00 %    3.50 % 

2009 Community Investment Goal

 

    

Segment

Weight

   

75% Goal

Achievement

Measure

 

100% Goal

Achievement

Measure

 

150% Goal

Achievement

Measure

 

200% Goal

Achievement

Measure

CIP/ACE/HPA advances and letters of credit (# of members)

  6 %    [*]   [*]   [*]   [*]

Technical Assistance

  6 %    [*]   [*]   [*]   [*]

Community Investment grant program participation (# of members)

  8 %    [*]   [*]   [*]   [*]

Total Community Investment Goal

  20 %                 

2009 Advances Volume Goal

 

Member Segment  

Segment

Weight

   

75% Goal

Achievement

Measure

   

100% Goal

Achievement

Measure

   

150% Goal

Achievement

Measure

   

200% Goal

Achievement

Measure

 

Members with CQRs 1-5

  5 %    $ [*]

(avg. daily balance

  

)

  $ [*]

(avg. daily balance

  

) 

  $ [*]

(avg. daily balance

  

) 

  $ [*]

(avg. daily balance

  

) 

2009 Senior Officer Goal Weights

 

     Senior Vice President     Executive Vice President        

Corporate

Goal

Weights

    Goal Weight (includes
individual goals)    

Corporate

Goal

Weights

    Goal Weight (includes
individual goals)  

Individual

   N/A      30 %    N/A      20 % 

Risk Management

   50 %    35 %    50 %    40 % 

Potential Dividend Spread

   25 %    17.5 %    25 %    20 % 

Community Investment

   20 %    14 %    20 %    16 % 

Advances Volume

   5 %    3.5 %    5 %    4 % 

Total

   100 %    100 %    100 %    100 % 

 

 

[*] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portion.