FHLB Des Moines: Your source for Paycheck Protection Funding

posted on Wednesday, April 8, 2020 in Advances

The Coronavirus Aid, Relief and Economic Security (CARES) Act was signed into law on March 25, 2020.

Among the cornerstones of this act is the establishment of the Paycheck Protection Program, which is a new 7(a) loan option overseen by the Treasury Department and backed by the Small Business Administration, which is authorized to provide a 100% guarantee to lenders on loans issued under the program.

One of the primary concerns for institutions participating in this program is the availability of funding both short-term and long-term.

If your institution is looking for a price and duration certain source of funding to meet your expanding customer needs through the Paycheck Protection Program, consider using a short-term advance from FHLB Des Moines.

As the graph below depicts, FHLB Des Moines short-term advance levels are very attractive when compared to other competitors and provide both duration and pricing certainty.

Rates Comparison

The dividend adjusted rate is an approximation based off of our current stock requirement and current dividend payment. This is an approximation only.

We stand committed to working with our members as diligently as our members are working with their customers.

Questions?

Contact your Relationship Manager.

Request an Advance

Call the Money Desk at 800.544.3452, ext. 2122 to request an advance.

Evaluate Your Options

Click here to request an evaluation of your funding options using our Blended Funds Model.

See below for a few scenarios based on advance rates as of April 7, 2020.

Three Month Funding Option

This three month pipeline Paycheck Protection Program funding example is funded with a three month advance and utilizes a mid-range Small Business Administration processing fee of 3%. The FHLB Des Moines dividend benefit helps reduce this cost even further making this a very cost efficient way to fund Paycheck Protection Program loans.

3MO Blended Funds Example

Six Month Funding Option

This six month pipeline Paycheck Protection Program funding example is funded with a three month advance and utilizes a mid-range Small Business Administration processing fee of 3%.  The FHLB Des Moines dividend benefit helps reduce this cost even further making this a very cost efficient way to fund Paycheck Protection Program loans.

6MO Blended Funds Example

Funding Option for Portion of Paycheck Protection Program Loans not Forgiven

This two year pipeline Paycheck Protection Program funding example is for the portion of the Paycheck Protection Program loans that will not be forgiven. It is funded primarily with a two year community investment (CIA) amortizing advance that has a four month amortization delay and then a 20-month amortization. This utilizes a mid-range Small Business Administration processing fee of 3%. The term advance portion has a positive spread for the two year term and FHLB Des Moines dividend provides additional benefit.

Delayed AMO Blended Funds Example


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