Six Reasons to use our Advances and Letters of Credit

posted on Tuesday, May 2, 2017 in Advances

Our Member Strategies professionals are always available to help you assess your asset and liability methodology. We use a consultative partnership approach to our relationship with you - helping your institution thrive is our top priority. Here are six strategies from FHLB Des Moines to consider if you're looking to hedge risk and improve balance sheet liquidity:

  1. If you're looking to evaluate the pricing of deposits compared to the competition, consider employing our Marginal Cost of Funds model. This approach can also be used to compare the marginal cost of new money obtained from a deposit special with the cost of borrowing the same amount from FHLB Des Moines.
  2. Hedge unwanted interest rate risk with our Term AdvancesWe have a suite of products available with this goal in mind and can help you compare their individual benefits and features.
  3. Lock net interest spreads now and pay for it later using our Forward Starting Advance.
  4. Use our Letters of Credit to build your relationships with public unit depositors, support new business opportunities and improve your balance sheet liquidity.
  5. Take advantage of rising interest rates and fund a wide variety of fixed-rate assets with our Symmetrical Prepayment Advance.
  6. Remember to test your lines at least twice a year - it's the best way to document to your regular that your lines with FHLB Des Moines are secure, and to identify any gaps in authority or understanding within your institution if an emergency occurs.

Contact your VP/Relationship Manager and we can help you identify funding ideas for any objective you are looking to fulfill. Also, be sure to check out our other educational resources to get the most out of your membership with FHLB Des Moines.


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