2007 Product and Service Enhancements
 
In an effort to provide our members with more choice, flexibility and convenience, FHLB Des Moines expanded its product and service offerings this year. These changes, designed to better meet the funding and business needs of members, have been well-received. Several members have already taken advantage of the Bank’s new products while others have benefited from service enhancements.

FHLB Des Moines introduced two new advance products in September – the Member Option Fixed Rate Advance and the Member Option Variable Rate Advance. Citizens Bank and Trust Company, based in Chillicothe, Missouri, recently utilized the Member Option Fixed Rate Advance as a risk management tool. The advance was used along with a number of bullet advances to purchase mortgage investments.

“Citizens Bank and Trust Company took advantage of the Home Loan Bank’s new member owned option advance to hedge the prepayment option risk of mortgage related assets,” remarked Ed Place, Citizens Bank and Trust chief financial officer. “The advance was more cost effective than other callable liability alternatives without an additional cost being incurred should the embedded call feature be exercised. This is an outstanding new product that our organization plans to use again in the future.”

In addition to the introduction of new advance products, FHLB Des Moines extended its Wire Room hours to accommodate member’s cash management needs, expanded the term and loan limits of eAdvantage, our secure, online banking service, and introduced “Unique Funding Opportunities.” The Bank also reduced its collateral maintenance levels (CML) on one-to-four family mortgage loans. This reduction resulted in increased borrowing capacity for some members, including BankWest, Inc. located in Pierre, South Dakota.

“The Home Loan Bank’s CML changes increased BankWest’s collateral by a little over $6.0 million. Our organization has used this increased capacity to take advantage of the current illiquidity in the bond markets by borrowing to fund security purchases,” commented Steve Bumann, chief financial officer, BankWest, Inc.

 

This year, the Bank also changed its deposit pricing strategy to provide members with more convenience, security and a competitive rate. And, the Bank now accepts 1-4 family construction loans as collateral and purchases United States Department of Agriculture and Section 184 loans through its Mortgage Partnership Finance® Program.

FHLB Des Moines will continue to focus on providing increased value to our members in 2008. This may result in further enhancements to additional products or services. Please check the Bank’s website, www.fhlbdm.com, for more details on any recent or upcoming changes.