Common use of Eligibility and Creditworthiness of PFIs Clause in Contracts

Eligibility and Creditworthiness of PFIs. Unless otherwise stated in this Agreement, the approval of PFIs shall be as set forth in the FHLB Guide. Each MPF Bank shall be responsible for evaluating the eligibility, including the creditworthiness, of each of its PFIs for participation under the MPF Program for both Bank Program Loans and Provider Program Loans. However, any MPF Bank that has acquired or acquires a participation in Bank Program Loans or acquires Program Loans from MPF Bank PFIs shall be responsible for its own credit decision with respect to its investment in such assets. Consistent with applicable law and regulation and as provided in the FHLB Guide, each MPF Bank shall promptly provide notice to the MPF Provider of any material adverse change in the financial condition of any such MPF Bank’s PFIs of which it becomes aware and that such MPF Bank reasonably believes could result in the PFI’s breach of the PFI Agreement.