A Letter of Credit (LOC) from FHLB Des Moines is a product issued to guarantee payment for a member institution.
Letters of Credit are used for a variety of purposes, most commonly as an attractive alternative to pledging securities for public unit deposits. LOCs can also be used on other qualifying transactions -- bond issuances for community improvement projects, for example -- to improve the credit rating, thus lowering the cost of the project. The Bank's credit standing and capital market access substitutes for that of the member which helps to ensure a wide acceptance of our LOCs.
Please contact the Money Desk with questions about Letters of Credit or for additional assistance and details.