Standby Letter of Credit Application

Use of the Bank’s LOC may be subject to state and/or federal regulations. As we do not provide any guidance on this matter, it is each member’s responsibility to ensure that the use of an FHLB Des Moines LOC complies with any regulation to which a member is subject to. 

Online Application - Standby or Confirming LOC 

Beginning November 17,  Standby or Confirming LOC applications can be processed electronically through the FHLB Des Moines LOC System, found in eAdvantage.

1. To begin, you must have the advances authority permission assigned to your user account within eAdvantage.
   • If you have questions regarding the eAdvantage Administrator process, or identifying your eAdvantage Administrator, please contact memberservices@fhlbdm.com or 800.544.3452 ext. 2200.
2. Launch the Letter of Credit system by accessing the 'Line of Business' drop-down menu in eAdvantage.
   • The LOC system requires a separate login than your eAdvantage credentials.
     • New users can click 'Forgot Password' on the log in screen to receive a one-time account setup link.
3. When prompted, type in your member number, User ID and password.
4. Click ‘Sign On’ to launch system.

A complete user guide can be found within the "Links" menu on the eAdvantage homepage.

LAUNCH EAdvantage

Paper Application - Standby LOC

All members using LOCs will need to be prepared to transition from paper applications no later than December 31, 2025. 

Please contact the Money Desk if you have any questions about the Standby Letter of Credit application form, need additional assistance or would like additional details about our Letter of Credit.

1. Download the Standby Letter of Credit application form.
2. Complete all of the required application fields.
3. Email the application to the Money Desk for processing. Applications must be received by 3:00 p.m. (CT) for same day processing. While members can fax the application to the Money Desk, emailed applications are the preferred submission method.

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Collateral Requirements

LOCs are subject to the same collateral requirements as Bank advances.

Activity Stock Requirements

Members are required to purchase and hold activity stock in an amount equal to 0.10% for LOCs. 

Letter of Credit Purpose Definitions

• LOC Purpose: Asset/Liability Management

  To assist member with asset/liability management, in lieu of providing cash collateral or securities or to otherwise mitigate the risks associated with mismatched assets and liabilities, including:

  A. To support issuance of a bond

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• LOC Purpose: Public Fund/Public Unit Deposit

  To assist member in securing obligations of a public unit depositor, as defined by the Federal Deposit Insurance Corporation (FDIC):

  A. Public unit depositor means "includes a state, county, municipality, or any 'political subdivision' of the public unit."

  B. Public subdivision means “to include drainage, irrigation, navigation, improvement, levee, sanitary, school or power districts, and bridge or port authorities and other special districts created by state statute or compacts between the states.”

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• LOC Purpose: Residential Housing Finance

  To assist member in facilitating residential housing finance, as defined by the Federal Housing Finance Agency (FHFA) 12 C.F.R. § 1266.1; the purchase or funding of:

  A. Loans secured by residential real property

  B. Mortgage-backed securities

  C. Participations in loans secured by residential real property

  D. Loans or investments providing financing for economic development projects for targeted beneficiaries

  E. Loans secured by manufactured housing, regardless of whether such housing qualifies as residential real property

  F. Any loans or investments which FHFA, in its discretion, otherwise determines to be residential housing finance assets

  G. For Community Financial Institutions (CFI) members, and to the extent not already included in (1) small business loans, small farm loans, small agri-business loans, or community development loans

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• LOC Purpose: Liquidity or Other Funding

  To provide members with liquidity, to collateralize future payments in lieu of an upfront lump sum payment or to otherwise enhance your institution’s ability to meet contractual obligations, including:

  A. To secure an interest rate swap, interest rate exchange, interest exchange or such other comparable agreement between the Member and the beneficiary

  B. To support the payment of insurance premiums

  C. To support the payment of rent

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This is a list of commonly used purposes for Letters of Credit, for any instance not listed please contact your state and/or federal regulator to see if they comply.