Member Credit

As your trusted partner, FHLB Des Moines wants to ensure that you have the ability to continue to utilize Bank products and services. 

The creditworthiness of financial institutions that transact business with FHLB Des Moines is determined by the Credit Department. These include, but are not limited to, current and prospective members, housing associates, PFIs, counterparties, securities issuers and dealers and vendors.  A variety of information is used when performing credit analysis, including regulatory financial reporting, audited financial statements, SEC filings, reports of insured financial institution examinations, rating agencies and more.  The results of the analysis are used to determine eligibility for FHLB Des Moines membership or financial limits on activity by individual members or other entities.

Member Credit Capacity Review

Each quarter, members' assigned credit capacities are reviewed utilizing various sources of information. This review process utilizes report of examination findings, financial results and trends, enforcement actions, SEC filings, discussions with member management and/or regulators, and any other relevant material information. Material changes in financial condition, including events that occurred subsequent to the quarterly information used in the analysis, may have an impact on a member’s assigned credit capacity.

Members are generally notified in advance of potential declines in their credit capacity and given the opportunity to provide additional information to be considered in the credit assessment process. A final credit capacity is then assigned for the current quarter that will remain in effect until the next quarterly credit review or upon receipt of new credit-related information, whichever comes first.

Member Credit Information

FHLB Des Moines provides information to assist members in estimating the likelihood that their credit capacity may change. The Quarterly Median Ratios report lists the medians based on members' credit capacity for certain financial ratios as of the most recent quarter reviewed. The CAMELS vs Credit Capacity Report shows the correlation between a member's CAMELS rating and their FHLB Des Moines credit capacity.

Members can use the information contained in these documents to help assess the likelihood of a change in their credit capacity. Some members find it useful to include the results of their assessment in their institution's liquidity plan.

Credit Capacity Impact

The assigned credit capacity not only determines the maximum amount of borrowing capacity available, assuming adequate eligible collateral, but also determines the maximum term for advances. The Credit Capacity-Collateral Requirements-Term Limits charts shows the relationship between the components.

Member Adverse Event Reporting

In order to mitigate risk, we need to be made aware, in a timely manner, of events that could influence financial decisions.

General Definition: Generally speaking, a material adverse event would be any event or series of events that would cause a member's representations and warranties executed through the Advances Pledge and Security Agreement with FHLB Des Moines to no longer to be true. In short, if an event occurs that you would report to your regulator, please inform FHLB Des Moines.

All Federal Home Loan Bank of Des Moines members are required to report material adverse events to the Bank. The member has always been responsible for reporting to the Bank any material adverse event that would render any representations or warranties invalid or untrue. Please report, to the best of your knowledge, material events to the Credit Department.

Material Adverse Events Report

Credit Constrained Members

Members who are experiencing deterioration in their financial condition and, as a result, a reduction in their FHLB Des Moines credit capacity to 25% of total assets or less can request that an exception be considered by the Bank to provide greater borrowing capacity. For those with the lowest credit capacity, approval by the primary regulator may also be required. Members should contact their Vice President-Relationship Manager if they wish to request an exception.