A N N U A L R E P O R T2 0 1 3

S E R V I C E

P A R T N E R S H I P S

S O L U T I O N S

Table of Contents

Member Letter Pages 2 - 3

Financial Summary Page 4

Strong Communities Fund Page 5

Board of Directors Pages 6 - 7

Leadership Pages 8 - 10

http://ar2013.fhlbdm.com

1

To Our MembersService. Partnerships. Solutions. These three simple words not only define us but also connect us to you.

Service. A relentless commitment to putting you, our members, first. This is the essence of who we are and what we do.Partnerships. Fundamental to how we get things done…whether it is with you or the communities you serve.Solutions. We exist to provide you and your communities with the tools needed to elevate your performance.

For more than 80 years, our commitment has been to you. As a member-owned cooperative, our success is dependent on your success – our productsand services are designed to help your institution and community thrive. In 2013, we accomplished great things together!

Year in Review As the low interest rate environment continued in 2013, our overall earnings declined slightly, yet our financial performance remained strong. Wereported net income of $109.8 million in 2013 compared to $111.4 million in 2012. By maintaining this level of profitability, we were able to continue topay annualized dividends of 3.5 percent on activity stock while also meeting our strategic objective to gradually build retained earnings.

Our total assets increased during 2013 from $47.4 billion to $73.0 billion, due primarily to an increase in advances and investments in the latter part ofthe year. Similar to a cooperatively-owned utility, we have the ability to handle customer needs in periods of low demand as well as periods of highdemand. This was evident as advances increased from $26.6 billion to $45.6 billion during the year. While, we saw increasing demand for funding froma wide range of our borrowing members in 2013, a large depository institution member accounted for most of the overall growth in our advances.Investments were up $6.7 billion mainly due to an increased need for short term investments used to manage the Bank's liquidity, supporting higheradvance balances.

Mortgage loans acquired and held for our portfolio decreased slightly in 2013 from $7.0billion to $6.6 billion, as principal paydowns slightly exceeded new mortgage loanpurchases. Rising interest rates on mortgages beginning in the second quarter of 2013brought a sudden slowdown in refinance activity, resulting in a significant reduction innational mortgage originations from 2012 to 2013. Last year, we recorded $1.2 billion inpurchases through our Mortgage Partnership Finance® program traditional product, downfrom $2.1 billion in 2012. In addition, $1.6 billion was delivered through the MPF Xtra®program, our off-balance sheet program with loans passed-through to Fannie Mae.Despite the overall slowdown in mortgage originations, the combination of these programsallowed us to help our members fund more than 18,000 home loans during 2013.

Retained earnings grew to $678 million at the end of 2013 compared to $622 million at thebeginning of the year. Total capital increased during the year from $2.8 billion to $3.5billion due primarily to an increase in activity-based capital stock resulting from the increasein advances.

For more details about our financial performance, we encourage you to review our 2013Form 10-K, financial summary and our five-year charts.

LEADERSHIP AND COMMITMENT

We are grateful for the hard work, diligence andguidance our Board of Directors provides us eachyear. Dale Oberkfell and Joseph Stewart III werere-elected by Missouri members to serve newterms beginning January 1, 2014.

We also welcomed newly elected Iowa memberdirector Kevin Swalley and honored retiringdirectors Clair Lensing and Labh Hira. For moreinformation about our 2014 board of directors, click here.

2

Member News and Shared ImpactDuring the course of 2013, we continued to play a leadership role in helping to define thefuture of housing finance. We had an opportunity to provide testimony to the SenateCommittee on Banking, Housing and Urban Affairs in November during its hearing entitled“Housing Finance Reform: Protecting Small Lender Access to the Secondary MortgageMarket.” The testimony focused on the importance of lenders of all sizes and types havingaccess to the secondary mortgage market as well as the potential role the Federal HomeLoan Bank System can play in ensuring access for our members.

As your solutions provider, we have committed to creating the products and services thatyou need to elevate your performance. An example is the Forward Starting Fixed-RateAdvance. This new product was recently rolled out and allows you to lock in the price offuture funding without adding immediate liquidity.

The success of our Strong Communities Fund housing programs, including theCompetitive Affordable Housing Program (AHP), Homeownership Fund (HOF) and NativeAmerican Homeownership Initiative (NAHI), is dependent on strong partnerships with youand your community partners. Last year, alone, $13.8 million in grants was awardedthrough AHP to create or rehabilitate nearly 1,600 homes. In addition, our HOF awarded$2.0 million to 135 members, and we allocated $300,000 in grants for home purchasesthrough NAHI.

We know strong communities are not possible without you. In 2014, we will be announcingour newly created Strong Communities Award. The Strong Communities Award willrecognize the success of initiatives that promote small business growth and retention. Youwill have the chance to nominate a project that matters to your community. We will roll out

the Strong Communities Award on May 12, 2014 and look forward to showcasing the great work that you are doing to support local businesses acrossour district.

Looking AheadIn the coming year, we will continue to focus on delivering exceptional service, creating strong partnerships and providing solutions that help you thrive.This will come in the form of new products, expanded educational opportunities and much more. Additionally, we look forward to a continued role inshaping housing finance reform, working to ensure competitive access for you to the secondary mortgage market.

Together…we will accomplish great things in 2014!

Richard S. SwansonPresident and CEO

Dale E. Oberkfell2013 Board Chair

“Mortgage Partnership Finance,” “MPF,” and “MPF Xtra” are registered trademarks of the Federal Home Loan Bank of Chicago.

Housing Finance Reform: Protecting SmallLender Access to the Secondary MortgageMarket – November 5, 2013

“Recognizing that the focus of this hearing is onsmall lenders, it is important to keep in mind thatthe presence and active participation of membersof all sizes and varied types, including thrifts,commercial banks, credit unions, insurancecompanies, and community development financialinstitutions, has been a key factor in the success ofthe FHLBank cooperative model. The FHLBankscan help ensure that financial institutions of allsizes have equal access to secondary mortgagefunding nationwide so that their customers canobtain competitive market rate mortgage loans in allbusiness cycles and their communities remainvibrant.”

Excerpt from the Testimonyof Richard S. Swanson in front of the SenateBanking Committee

3

Financial SummaryRelated Documents

December 31,

Statements of Condition($ in millions) 2013 2012 2011 2010 2009

Investments $20,131 $13,433 $14,637 $18,639 $20,790

Advances 45,650 26,614 26,591 29,253 35,720

Mortgage loans, net 6,557 6,952 7,138 7,421 7,717

Total assets 73,004 47,367 48,733 55,569 64,657

Total consolidated obligations 68,332 43,020 44,822 50,999 59,912

Capital stock - Class B putable 2,692 2,063 2,109 2,183 2,461

Retained earnings 678 622 569 556 484

Year Ended December 31,

Operating Results andPerformance Ratios($ in millions)

2013 2012 2011 2010 2009

Net interest income before provision $213.1 $240.6 $235.6 $414.9 $197.4

Net income 109.8 111.4 77.8 133.0 145.9

Return on average assets 0.20% 0.23% 0.15% 0.22% 0.21%

Return on average capital stock 4.94 5.44 3.66 5.76 5.05

Net interest margin 0.39 0.49 0.44 0.67 0.28

The selected financial data above should be read in conjunction with the financial statements and notes and "Management′s Discussion and Analysisof Financial Condition and Results of Operations" included in the Bank′s 2013 Form 10-K filed on March 11, 2014 with the SEC.

Statements of Condition

Statements of Income

4Q 2013 Earnings Release

4

Strong Communities FundRelated Documents

Throughout 2013, we have focused on the important housing needs in our five-state district by providing innovative solutions in a difficult financialenvironment. Our Strong Communities Fund (SCF) housing programs are here to serve you and your partners.

Competitive Affordable Housing Program – 43 projects received a total of $13.79 million in grants to create or improve 1,592 homes.Homeownership Fund – $2.0 million was awarded to 135 members to put hundreds of families into homes.Native American Homeownership Initiative – $300,000 was allocated to assist families with purchasing a home.

For those members, non-profit organizations and community partners that have participated in and benefited from one of these programs, you knowthat we are providing more than just roofs over heads – we are providing a place to call home.

The Bank’s Advisory Council, Board of Directors and Community Investment team believe in our housing mission. In 2013 we took time to study andrealign our brands and programs to help you and your sponsors understand their impact.

Development of the Strong Communities Fund: to better align our current programs under one brand, we created the Strong CommunitiesFund. SCF is not a new program, it is simply a way for us to recognize the shared goal that we have with each and every one of ourpartners…to build strong communities through the creation of safe housing, sustainable economies and good jobs.

1.

Completion of a housing needs study: this year long endeavor looked at population and housing issues across the Bank’s district. The AdvisoryCouncil and Bank will use this study to help determine the housing needs to be addressed through the SCF housing programs.

2.

Creation of the Homeownership Fund: the Rural Homeownership Fund and Urban First-time Homebuyer Fund were combined into thisdownpayment and closing cost assistance program in 2013. By combining these two funds, the Bank simplified eligibility and increased thenumber of members using the fund.

3.

As we prepare to celebrate the 25th anniversary of the Affordable Housing Program, we reflect on defining moments just like these that make up therich history of this program. As a member of the Advisory Council and recipient of the funding, I am personally grateful for the investment made tostrengthen and enrich the communities we serve.

I encourage you to take advantage of our Strong Communities Fund housing programs. By participating in any one of these offerings, you can developcreative and competitive solutions that contribute to the quality of life for your customers and communities.

2013 Advisory Council Chair

2013 AHP Profile Book

SCF Impact Report

5

Board of DirectorsOur 2013 FHLB Des Moines Board of Directors was comprised of 16 directors: nine member directors and seven independent directors. You can findout more about our board members by clicking on their names.

Johnny Danos

Director of Strategic DevelopmentLWBJ FinancialWest Des Moines, IA

John Kennedy, Sr.

EVP and CFOSt. Louis Equity Fund, Inc.St. Louis, MO

Gerald Eid

CEOEid-Co Buildings, Inc.Fargo, ND

Ellen Lamale

West Des Moines, IA

Mike Finley

PresidentJanesville State BankJanesville, MN

Clair Lensing

President and CEOSecurity State BankWaverly, IA

Van Fishback

Director and Vice ChairFirst Bank & TrustBrookings, SD

Paula Meyer

PrincipalPaula R. Meyer ConsultingSt. Ansgar, IA

Chris Grimm

PresidentIowa State BankBurlington, IA

Dale Oberkfell

EVP & CFOMidwest BankCentreSt. Louis, MO

Eric Hardmeyer

President & CEOBank of North DakotaBismarck, ND

JOHN Rigler, II

President & CEOState Bank and Trust CompanyNew Hampton, IA

6

Labh Hira, PHD

Dean Emeritus and ProfessorCollege of BusinessIowa State UniversityAmes, IA

John Robinson

ChairmanHamilton Ventures, LLCKansas City, MO

Teresa Keegan

Senior Vice President & CFOFidelity BankEdina, MN

Joe Stewart, III

ChairmanBancStar, Inc.Des Peres, MO

7

LeadershipService. Partnerships. Solutions. Our Management Team is leading the way to enhance your membership every day. You can find out more aboutour Management Team by clicking on their names.

Richard SwansonPresident &Chief Executive Officer

Dan CluteExecutive VICE PRESIDENT &Chief Business Officer

Steve SchulerExecutive VICE PRESIDENT &Chief Financial Officer

DUSAN STOJANOVICExecutive VICE PRESIDENT &Chief Risk Officer

8

Bill BemisVP/Treasurer

Nancy BetzSVP/Director, Human Resources

Mary CecolaSVP/Chief Business Technology Officer

George CrowleySVP/Director,Credit & Mortgage Sales

9

Ardis KelleySVP/Chief Accounting OfficeR

Aaron LeeSVP/General CounseL &Corporate Secretary

Joelyn MarrenVP/Director,Portfolio Strategy

Kelly RasmusonSVP/Director,Internal Audit

10

Federal Home Loan Bank of Des Moines 801 Walnut Street, Suite 200, Des Moines, IA 50309-3513

800.544.3452 • fhlbdm.com