Description of Securities w

As of December 31, 2019, the Federal Home Loan Bank of Chicago (the “Bank”) has one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”): Class B Stock, par value $100 per share (the “Class B Stock”), which is registered under Section 12(g) of the Exchange Act.

The Bank’s Second Amended and Restated Capital Plan, effective as of October 1, 2015 (the “Capital Plan”), sets forth the capital structure of the Bank. Before implementing any amendments to the Capital Plan, the Bank must obtain the approval of a majority of the Board of Directors, as well as the approval of the Federal Housing Finance Agency (the “FHFA”). The Bank will provide at least 30 days prior written notice to its stockholders before any amendment to the Capital Plan becomes effective.

The following description of the Bank’s Class B Stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to the Federal Home Loan Bank of Chicago Charter, the Federal Home Loan Bank of Chicago Bylaws and the Capital Plan, each of which is incorporated by reference as an exhibit to the Bank’s 2019 Annual Report on Form 10-K, as well as the Federal Home Loan Bank Act, as amended (the “FHLB Act”) and FHFA regulations.

Under the Capital Plan, the Bank issues a single class of capital stock to its members: Class B Stock, which consists of two sub-classes of stock, Class B1 Stock and Class B2 Stock. Under the Capital Plan, each member is required to own Class B Stock in an amount equal to the greater of a membership stock requirement or an activity stock requirement. Class B1 Stock is available to support a member's activity stock requirement. Class B2 Stock is available to support a member's membership stock requirement and any activity stock requirement. See the Capital Resources section on page 54 of the Bank’s 2019 Annual Report on Form 10-K for a description of the ranges of capital stock requirements permitted under the Capital Plan and capital stock requirements during 2019. Additionally, the Board of Directors of the Bank has a right to call for additional capital stock purchases by members, as a condition of continuing membership, as needed for the Bank to satisfy its statutory and regulatory capital requirements.

FHFA regulations and the Capital Plan prohibit the Bank from redeeming or repurchasing Class B Stock in certain instances, including where it would cause the Bank to fail to meet its minimum capital requirements or cause the member or former member to fail to maintain its minimum investment requirement. See Capital Resources-Capital Rules on page 54 of the Bank’s 2019 Annual Report on Form 10-K for additional details on statutory and regulatory restrictions on repurchases and redemptions.

With the Bank’s prior approval, a member (or former member) may transfer any Excess Stock to another member or to an institution that has satisfied all conditions to become a member (other than the prospective member’s stock purchase requirement).

Members are also entitled to vote in connection with other matters as authorized or required by applicable law in existence at the time of such event. See Item 10. Directors, Executive Officers, and Corporate Governance - 2019 Director Election of the Bank’s 2019 Annual Report on Form 10-K for details on voting rights and process with regard to the election of member and independent directors of the Bank.