# EDGAR Filing Document

**Accession Number:** 0001325814
**File Stem:** 0001628280-26-016325
**Filing Date:** 2026-3
**Character Count:** 651351
**Document Hash:** 8a52c6269def9d258312451d23240d9f
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001628280-26-016325.hdr.sgml**: 20260310

**ACCESSION NUMBER**: 0001628280-26-016325

**CONFORMED SUBMISSION TYPE**: 10-K

**PUBLIC DOCUMENT COUNT**: 117

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260310

**DATE AS OF CHANGE**: 20260310

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Federal Home Loan Bank of Des Moines
- **CENTRAL INDEX KEY:** 0001325814
- **STANDARD INDUSTRIAL CLASSIFICATION:** FEDERAL & FEDERALLY-SPONSORED CREDIT AGENCIES [6111]
- **ORGANIZATION NAME:** 02 Finance
- **EIN:** 426000149
- **STATE OF INCORPORATION:** X1
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-51999
- **FILM NUMBER:** 26738254

**BUSINESS ADDRESS:**
- **STREET 1:** 909 LOCUST STREET
- **CITY:** DES MOINES
- **STATE:** IA
- **ZIP:** 50309
- **BUSINESS PHONE:** 515-412-2100

**MAIL ADDRESS:**
- **STREET 1:** 909 LOCUST STREET
- **CITY:** DES MOINES
- **STATE:** IA
- **ZIP:** 50309

?xml version='1.0' encoding='ASCII'? fhlbdm-20251231

    

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

**FORM 10-K** 

☒ **ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934**

**For the fiscal year ended December 31, 2025** 

**OR**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934**

**Commission File Number: 000-51999** 

**FEDERAL HOME LOAN BANK OF DES MOINES** 

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Federally chartered corporation of the United States** | **42-6000149** |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification number) |
| **909 Locust Street** | **50309** |
| **Des Moines, IA** | (Zip code) |
| (Address of principal executive offices) | |

---

Registrant's telephone number, including area code: **(515) 412-2100** 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered <br>   

Securities registered pursuant to Section 12(g) of the Act: Class B Stock, par value $100

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. □ Yes ⌧No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. □ Yes ⌧No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ⌧Yes □No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ⌧ Yes □No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange Act.

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Large accelerated filer | **☐** | Accelerated filer | **☐** | Non-accelerated filer | ⌧ | Smaller reporting company | **☐** | Emerging growth company | **☐** |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.7262(b)) by the registered public accounting firm that prepared or issued its audit report. ⌧

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. □

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to 17 CFR 240.10D-1(b). □

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). **☐** Yes ⌧No

Registrant's stock is not publicly traded and is only issued to members of the registrant. Such stock is issued and redeemed at par value, $100 per share, subject to certain regulatory and statutory limits. At June 30, 2025, the aggregate par value of the stock held by current and former members of the registrant was $6,694,016,600. At February 28, 2026, 73,091,289 shares of stock were outstanding.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

---

| | |
|:---|:---|
| **<u>**Table of Contents**</u>** | **<u>**Table of Contents**</u>** |
| [Special Note Regarding Forward-Looking Statements](#i6940522039644a7690f9aab973fdec20_10) and Definitions | [3](#i6940522039644a7690f9aab973fdec20_10) |
| **Part I** | |
| [Item 1. Business](#i6940522039644a7690f9aab973fdec20_16) | [4](#i6940522039644a7690f9aab973fdec20_16) |
| [Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19) | [15](#i6940522039644a7690f9aab973fdec20_19) |
| [Item 1B. Unresolved Staff Comments](#i6940522039644a7690f9aab973fdec20_22) | [22](#i6940522039644a7690f9aab973fdec20_22) |
| [Item 1C. Cybersecurity](#i6940522039644a7690f9aab973fdec20_25) | [22](#i6940522039644a7690f9aab973fdec20_25) |
| [Item 2. Properties](#i6940522039644a7690f9aab973fdec20_28) | [23](#i6940522039644a7690f9aab973fdec20_28) |
| [Item 3. Legal Proceedings](#i6940522039644a7690f9aab973fdec20_31) | [23](#i6940522039644a7690f9aab973fdec20_31) |
| [Item 4. Mine Safety Disclosures](#i6940522039644a7690f9aab973fdec20_34) | [24](#i6940522039644a7690f9aab973fdec20_34) |
| **Part II** | |
| [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#i6940522039644a7690f9aab973fdec20_40) | [24](#i6940522039644a7690f9aab973fdec20_40) |
| [Item 6. \[RESERVED\]](#i6940522039644a7690f9aab973fdec20_43) | [24](#i6940522039644a7690f9aab973fdec20_43) |
| [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](#i6940522039644a7690f9aab973fdec20_46) | [25](#i6940522039644a7690f9aab973fdec20_46) |
| [Item 7A. Quantitative and Qualitative Disclosures about Market Risk](#i6940522039644a7690f9aab973fdec20_133) | [62](#i6940522039644a7690f9aab973fdec20_133) |
| [Item 8. Financial Statements and Supplementary Data](#i6940522039644a7690f9aab973fdec20_136) | [63](#i6940522039644a7690f9aab973fdec20_136) |
| [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](#i6940522039644a7690f9aab973fdec20_250) | [116](#i6940522039644a7690f9aab973fdec20_250) |
| [Item 9A. Controls and Procedures](#i6940522039644a7690f9aab973fdec20_253) | [116](#i6940522039644a7690f9aab973fdec20_253) |
| [Item 9B. Other Information](#i6940522039644a7690f9aab973fdec20_256) | [117](#i6940522039644a7690f9aab973fdec20_256) |
| [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#i6940522039644a7690f9aab973fdec20_259) | [117](#i6940522039644a7690f9aab973fdec20_259) |
| **Part III** | |
| [Item 10. Directors, Executive Officers and Corporate Governance](#i6940522039644a7690f9aab973fdec20_265) | [118](#i6940522039644a7690f9aab973fdec20_265) |
| [Item 11. Executive Compensation](#i6940522039644a7690f9aab973fdec20_268) | [127](#i6940522039644a7690f9aab973fdec20_268) |
| [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#i6940522039644a7690f9aab973fdec20_310) | [143](#i6940522039644a7690f9aab973fdec20_310) |
| [Item 13. Certain Relationships and Related Transactions, and Director Independence](#i6940522039644a7690f9aab973fdec20_313) | [144](#i6940522039644a7690f9aab973fdec20_313) |
| [Item 14. Principal Accounting Fees and Services](#i6940522039644a7690f9aab973fdec20_316) | [146](#i6940522039644a7690f9aab973fdec20_316) |
| **Part IV** | |
| [Item 15. Exhibits and Financial Statement Schedules](#i6940522039644a7690f9aab973fdec20_322) | [147](#i6940522039644a7690f9aab973fdec20_322) |
| [Item 16. Form 10-K Summary](#i6940522039644a7690f9aab973fdec20_325) | [147](#i6940522039644a7690f9aab973fdec20_325) |
| [Glossary of Terms](#i6940522039644a7690f9aab973fdec20_328) | [147](#i6940522039644a7690f9aab973fdec20_328) |
| [Signatures](#i6940522039644a7690f9aab973fdec20_331) | [150](#i6940522039644a7690f9aab973fdec20_331) |

---

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**<u>SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND DEFINITIONS</u>**

Statements contained in this report, including statements describing the objectives, projections, estimates, or future predictions in our operations, may be forward-looking statements. These statements may be identified by the use of forward-looking terminology, such as *believes*, *projects*, *expects*, *anticipates*, *estimates*, *intends*, *strategy*, *plan*, *could*, *should, may*, and *will* or their negatives or other variations on these terms. By their nature, forward-looking statements involve risk or uncertainty, and actual results could differ materially from those expressed or implied or could affect the extent to which a particular objective, projection, estimate, or prediction is realized. As a result, you are cautioned not to place undue reliance on such statements. These risks and uncertainties include, but are not limited to, the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• political or economic events, including legislative, regulatory, monetary, judicial, or other developments that affect us, our members, our counterparties, and/or our investors in the consolidated obligations of the 11 FHLBanks;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the ability to meet capital and other regulatory requirements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• competitive forces, including without limitation, other sources of funding available to our borrowers that could impact the demand for our advances, other entities purchasing mortgage loans in the secondary mortgage market, and other entities borrowing funds in the capital markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reliance on a relatively small number of member institutions for a large portion of our advance business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• member consolidations and failures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• disruptions in the credit and debt markets and the effect on future funding costs, sources, and availability;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• general economic and market conditions that could impact the business we do with our members, including, but not limited to, the timing and volatility of market activity, inflation/deflation, employment rates, geopolitical instability or conflicts, housing market activity and housing prices, the level of mortgage prepayments, the valuation of pledged collateral, and the condition of the capital markets and the impact it has on our consolidated obligations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• ineffective use of hedging strategies or the availability of derivative instruments in the types and quantities needed for risk management purposes from acceptable counterparties;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the volatility of reported results due to changes in the fair value of certain assets, liabilities, and derivative instruments;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks related to the other FHLBanks that could trigger our joint and several liability for debt issued by the other FHLBanks;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in the relative attractiveness of consolidated obligations due to actual or perceived changes in the FHLBanks' credit ratings or ratings outlook as well as the U.S. Government's long-term credit rating or rating outlook;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• increases in delinquency or loss estimates on mortgage loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the ability to develop and support internal controls, business processes, information systems, and other operating technologies that effectively manage the risks we face, including but not limited to, cyber-attacks, widespread health emergencies, and other business interruptions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• significant business interruptions resulting from third-party failures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the volatility of credit quality, market prices, interest rates, and other factors that could affect the value of collateral held by us as security for borrower and counterparty obligations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the ability to attract and retain key personnel; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• natural disasters.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

These forward-looking statements apply only as of the date they are made, and we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. A detailed discussion of the more important risks and uncertainties that could cause actual results and events to differ from such forward-looking statements is included under "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>."

Throughout this Form 10-K, acronyms and terms used are defined in the <u>[Glossary of Terms](#i6940522039644a7690f9aab973fdec20_328)</u>. Unless the context otherwise requires, the terms "Bank," "we," "us," and "our" refer to the Federal Home Loan Bank of Des Moines or its management.

**<u>PART I</u>**

**<u>ITEM 1. BUSINESS</u>**

**OVERVIEW**

The Bank is a federally chartered corporation and is one of 11 district FHLBanks. The FHLBanks are GSEs and were created under the authority of the FHLBank Act to serve the public by enhancing the availability of funds for residential mortgages and targeted community development. The Bank is regulated by the Finance Agency.

We are a cooperative, meaning we are owned by our customers, whom we call members. As a condition of membership, all members must purchase and maintain capital stock to support business activities with us. In return, we provide a readily available source of funding and liquidity to our member institutions and eligible housing associates in Alaska, Hawaii, Idaho, Iowa, Minnesota, Missouri, Montana, North Dakota, Oregon, South Dakota, Utah, Washington, Wyoming, and the U.S. Pacific territories of American Samoa, Guam, and the Commonwealth of the Northern Mariana Islands. Commercial banks, savings institutions, credit unions, insurance companies, and CDFIs may apply for membership. While not considered members, we also conduct certain business activities with state and local housing associates meeting statutory criteria.

**BUSINESS MODEL**

Our mission is to be a reliable provider of funding, liquidity, and services for our members so that they can meet the housing, business, and economic development needs of the communities they serve. In addition, we help to meet the economic and housing needs of our communities through our affordable housing and community investment initiatives. Our operating model balances the trade-off between attractively priced products, reasonable returns on capital stock, maintaining an adequate level of capital to meet regulatory capital requirements, and maintaining adequate retained earnings to preserve the par value of member-owned capital stock.

We are capitalized through the purchase of capital stock by our members. As a condition of membership, all of our members must purchase and maintain membership capital stock based on a percentage of their total assets as of the preceding December 31<sup>st</sup> subject to a cap of $10 million and a floor of $10,000. Each member is also required to purchase and maintain activity-based capital stock to support certain business activities with us. Member demand for our products expands and contracts with economic and market conditions. Our self-capitalizing capital structure, which allows us to repurchase or require additional capital stock based on member activity, provides us with the flexibility to effectively and efficiently meet the changing needs of our membership. While eligible to borrow, housing associates are not members and, as such, are not permitted to purchase capital stock.

Our capital stock is not publicly traded. It is purchased and redeemed by members or repurchased by us at a par value of $100 per share. Our current and former members own all of our outstanding capital stock. Former members own capital stock (included in MRCS) to support business transactions still outstanding with us. All stockholders, including current and former members, may receive dividends on their capital stock investment to the extent declared by our Board of Directors.

Our primary business activities are providing collateralized loans, known as advances, to members and housing associates and acquiring residential mortgage loans from our members. In addition, we maintain a portfolio of investments, all of which we believe are investment quality at the time of purchase. Our primary source of funding and liquidity is the issuance of debt securities, referred to as consolidated obligations, in the capital markets. Consolidated obligations are the joint and several obligations of all FHLBanks and are backed only by the financial resources of the FHLBanks. A critical component to the success of our operations is the ability to issue consolidated obligations regularly in the capital markets under a wide range of maturities, structures, and amounts, and at relatively favorable spreads to market interest rates.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

Our net income is primarily attributable to the difference between the interest income we earn on our advances, mortgage loans, and investments, and the interest expense we pay on our consolidated obligations. A portion of our annual net income is used to fund our AHP, which provides grants and subsidized advances to members to support housing for very low-, low-, or moderate-income households. In addition to our statutory AHP contributions, we engage in a variety of community investment initiatives to help meet the economic and housing needs of our communities. For additional details, refer to the "<u>[Affordable Housing and Community Investment](#i776b993d44e7490898ed8606664f91b5_41705)</u>" section of Item 1.

We have risk management policies, established by our Board of Directors, that allow us to monitor and control our exposure to various risks, including interest rate, liquidity, credit, operational, model, information security, legal, regulatory and compliance, strategic, and reputational, as well as capital adequacy. Our primary risk management objective is to manage our assets and liabilities in ways that ensure liquidity is available to our members and protect the par redemption value of our capital stock. For additional information on our risk management practices, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management.](#i6940522039644a7690f9aab973fdec20_130)</u>"

**MEMBERSHIP**

Our membership includes commercial banks, savings institutions, credit unions, insurance companies, and CDFIs. The majority of depository institutions in our district that are eligible for membership are currently members.

The following table summarizes our membership by type of institution:

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| Institutional Entity | 2025 | 2024 |
| Commercial banks | 847 | 867 |
| Savings institutions | 25 | 26 |
| Credit unions | 275 | 273 |
| Insurance companies | 75 | 73 |
| CDFIs | 7 | 7 |
| Total | 1229 | 1246 |

---

The following table summarizes our membership by asset size:

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| Membership Asset Size<sup>1</sup> | 2025 | 2024 |
| Depository institutions<sup>2</sup> |  |  |
| &nbsp;&nbsp;&nbsp;Less than $100 million | 13% | 14% |
| &nbsp;&nbsp;&nbsp;$100 million to $500 million | 47 | 46 |
| &nbsp;&nbsp;&nbsp;Greater than $500 million | 34 | 34 |
| Insurance companies |  |  |
| &nbsp;&nbsp;&nbsp;$100 million to $500 million | 1 | 1 |
| &nbsp;&nbsp;&nbsp;Greater than $500 million | 5 | 5 |
| Total | 100% | 100% |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Membership asset size is based on preceding September 30th financial information received from members.

2&nbsp;&nbsp;&nbsp;&nbsp;Depository institutions consist of commercial banks, savings institutions, credit unions, and CDFIs.

Our membership level declined slightly during 2025 due primarily to member consolidations, offset in part by new members. At December 31, 2025, approximately 62 percent of our members were CFIs. For 2025, CFIs were defined under the FHLBank Act to include all FDIC insured institutions with average total assets over the previous three-year period of less than $1.5 billion. The FHLBank Act also permits borrowers that qualify as a CFI to pledge certain CFI-specific collateral to the extent that we accept those loans as collateral for advances.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**BUSINESS SEGMENTS**

We manage our operations as one business segment. For further information on our operating segment, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 1 — Significant Accounting Policies — Segment Reporting](#i5a2c1689cb514c8a8776b66049ea6201_41590)</u>."

**PRODUCTS AND SERVICES**

**Advances**

We carry out our mission primarily through lending funds, which we call advances, to our members and eligible housing associates (collectively, borrowers). Our advance products are designed to provide liquidity and help borrowers meet the credit needs of their communities while competing effectively in their markets. Borrowers generally use our advance products as sources of wholesale funding and general asset-liability management.

Our advance products currently offered include the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Daily Reset Advances*. These advances can renew automatically for a period up to 90 days. Interest rates are set daily.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Fixed Rate Advances*. These advances are available over a variety of terms in amortizing and non-amortizing structures. Using an amortizing advance, a borrower makes predetermined principal and interest payments at scheduled intervals throughout the term of the advance. Forward starting advances are a type of fixed rate non-amortizing advance with settlement dates up to two years in the future, allowing members to lock in an interest rate at the outset, while delaying the receipt of funding and principal and interest payments. Delayed amortizing advances are a type of fixed rate advance with a feature that delays commencement of the repayment of the principal up to five years, allowing members control over the principal cash flows and the repayment of the advance. Certain long-term fixed rate and amortizing advances contain a symmetrical prepayment feature. This feature allows borrowers to prepay an advance and potentially realize a gain if interest rates rise to a level greater than those existing when the advance was originated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Variable Rate Advances*. These advances have interest rates that reset periodically to a specified interest rate index such as SOFR.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Callable Advances*. These advances may be prepaid by borrowers on predetermined dates (call dates) without incurring a prepayment fee and therefore provide borrowers a source of long-term financing with prepayment flexibility. Callable advances can be either fixed or variable in nature. Variable rate callable advances may reset at different frequencies generally ranging from daily to six months and are callable at specified dates. Fixed rate callable advances may have different call schedules based on member specifications, and principal balances may be amortizing in nature.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Community Investment Advances*. These advances are below-market rate funds used by borrowers in both eligible housing projects and community development. Interest rates on these advances represent our cost of funds plus a mark-up to cover our administrative expenses.

For the years ended December 31, 2025, 2024, and 2023, advances represented 58, 60, and 65 percent of our total average assets and generated 59, 63, and 68 percent of our total interest income. For additional information on our advances, including our top five borrowers, see "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Statements of Condition — Advances](#i6940522039644a7690f9aab973fdec20_91)</u>." In addition, refer to "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>" for a discussion on our exposure to customer concentration risk.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

COLLATERAL

We are required by regulation to obtain sufficient collateral to fully secure our advances, standby letters of credit, and other extensions of credit to borrowers (collectively, credit products). The estimated value of the collateral required to secure each borrower's credit products is calculated by applying loan-to-value discounts, or haircuts, to the unpaid principal balance or market value, as applicable, of the collateral.

Borrowers may pledge collateral to us by executing a blanket pledge agreement, specifically assigning collateral, or placing physical possession of collateral with us or our custodians. We perfect our security interest in all pledged collateral by filing Uniform Commercial Code financing statements or by taking possession or control of the collateral. Under the FHLBank Act, any security interest granted to us by our members, or any affiliates of our members, has priority over the claims and rights of any party (including any receiver, conservator, trustee, or similar party having rights of a lien creditor), unless those claims and rights would be entitled to priority under otherwise applicable law and are held by actual purchasers or by parties that have perfected security interests.

For additional information on our collateral requirements, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Credit Risk — Advances](#ia9c5fd5e2848466f9a0482fdb160304d_29199)</u>."

HOUSING ASSOCIATES

The FHLBank Act permits us to provide advances to eligible housing associates. Housing associates are eligible if they are approved mortgagees under Title II of the National Housing Act that meet certain criteria, including: (i) chartered under law, (ii) subject to inspection and supervision by some governmental agency, and (iii) lend their own funds as their principal activity in the mortgage field. The same regulatory lending requirements that apply to our members generally apply to housing associates. Because housing associates are not members, they are not subject to certain provisions of the FHLBank Act applicable to members and cannot own our capital stock. In addition, they may only pledge certain types of collateral including, but not limited to: (i) FHA mortgages, (ii) Ginnie Mae securities backed by FHA mortgages, (iii) certain residential mortgage loans, and (iv) cash deposited with us.

PREPAYMENT FEES

We generally charge a prepayment fee for advances that a borrower elects to terminate prior to the stated maturity or outside of a predetermined call date. The fees charged are priced to make us financially indifferent to the prepayment of the advance. For certain advances with symmetrical prepayment features, we may charge the borrower a prepayment fee or pay the borrower a prepayment credit, depending on certain circumstances, such as movements in interest rates, when the advance is prepaid.

**Standby Letters of Credit**

We may issue standby letters of credit on behalf of our members to support certain obligations of the members to third-party beneficiaries. Standby letters of credit may be offered to assist members and non-member housing associates in facilitating residential housing finance, community lending, and asset-liability management, and to provide liquidity. In particular, members often use standby letters of credit as collateral for deposits from federal and state government agencies. For additional details on our standby letters of credit, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 13 — Commitments and Contingencies](#i6940522039644a7690f9aab973fdec20_232)</u>."

**Mortgage Loans**

We invest in mortgage loans through the MPF program, a secondary mortgage market structure developed by the FHLBank of Chicago to help fulfill the housing mission of the FHLBanks. In the past, we also acquired mortgage loans purchased under the MPP; however, we currently do not purchase mortgage loans under this program. For the years ended December 31, 2025, 2024, and 2023, mortgage loans represented seven, six, and five percent of our total average assets and generated seven, five, and three percent of our total interest income.

Under the MPF program, we purchase eligible mortgage loans from members or housing associates called PFIs. We may also acquire MPF loans through participations with other FHLBanks. MPF loans are conforming conventional or government-insured fixed rate mortgage loans secured by one-to-four family residential properties.

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The FHLBank of Chicago (in this capacity, the MPF Provider) provides the infrastructure and operational support for the MPF program and is responsible for publishing and maintaining the MPF Guides, which detail the requirements PFIs must follow in originating, selling, and servicing MPF loans. In exchange for providing these services, the MPF Provider receives a fee from each of the FHLBanks participating in the MPF program. The MPF Provider has engaged Computershare Limited as the master servicer for the MPF program. Throughout the servicing process, the master servicer monitors each PFI's compliance with certain MPF program requirements and makes periodic reports to the MPF Provider.

*Participating Financial Institutions*

Our members and eligible housing associates must apply to become a PFI. In order to do MPF business with us, each member or eligible housing associate must meet certain eligibility standards and sign a PFI Agreement. The PFI Agreement provides the terms and conditions for the sale of MPF loans, including the servicing of MPF loans.

PFIs may either retain the servicing of MPF loans or sell the servicing to an approved third-party provider. If a PFI chooses to retain the servicing, it receives a servicing fee to manage the servicing activities. If a PFI chooses to sell the servicing rights to an approved third-party provider, the servicing is transferred concurrently with the sale of the MPF loans and a servicing fee is paid to the third-party provider.

*MPF Loan Types*

We currently offer MPF closed loan products in which we purchase loans acquired or originated by the PFI. In addition, we offer certain off-balance sheet loan products. MPF Xtra is an off-balance sheet loan product in which we assign 100 percent of our interest in PFI master commitments to the FHLBank of Chicago. The FHLBank of Chicago then purchases mortgage loans from our PFIs and sells MPF Xtra loans to Fannie Mae. MPF Government MBS is an off-balance sheet loan product where our PFIs sell government loans directly to the FHLBank of Chicago where they are pooled and securitized into Ginnie Mae MBS. Under these off-balance sheet products, we receive a small fee for our continued management of the PFI relationship.

The PFI performs all traditional retail loan origination functions on our MPF loan products. We are responsible for managing the interest rate risk and liquidity risk associated with the MPF loans we purchase and carry on our Statements of Condition. In order to limit our credit risk exposure to approximately that of an investor in an investment grade MBS, we require a credit risk sharing arrangement with the PFI on all MPF loans at the time of purchase.

*MPF Loan Volume*

Our member base for MPF loans is primarily a diverse mix of commercial banks and credit unions. Our ability to price MPF loans, coupled with changes in the interest rate environment, has allowed us to serve the liquidity needs of a broad range of members. During the years ended December 31, 2025, 2024, and 2023, we purchased $4.1 billion, $3.0 billion, and $2.4 billion of MPF loan products (excluding off-balance sheet loan products). In addition, we had off-balance sheet loan volumes of $0.3 billion during each of the years ended December 31, 2025, 2024, and 2023.

LOAN MODIFICATION PLANS

We offer loan modification plans for our PFIs. Under these plans, we generally reduce the interest rate, extend the maturity date, or permit the capitalization of past due amounts, escrow, or advance balances. We may also grant a forbearance period or offer payment deferrals in limited circumstances.

For additional discussion on our mortgage loans and their related credit risk, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 6 — Mortgage Loans Held for Portfolio](#i6940522039644a7690f9aab973fdec20_199)</u>" and "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Credit Risk — Mortgage Loans](#ia9c5fd5e2848466f9a0482fdb160304d_29193)</u>."

**Investments**

We maintain an investment portfolio primarily to provide liquidity as well as investment income. Our investment portfolio consists of both short- and long-term investments. Our short-term investments may include, but are not limited to, interest-bearing deposits, federal funds sold, securities purchased under agreements to resell, certificates of deposit, commercial paper, and U.S. Treasury obligations. Our long-term investments may include, but are not limited to, U.S. Treasury obligations, other U.S. obligations, GSE and TVA obligations, state or local housing agency obligations, taxable municipal bonds, and agency MBS. For the years ended December 31, 2025, 2024, and 2023, investments represented 34, 32, and 29 percent of our total average assets and generated 34, 32, and 29 percent of our total interest income.

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Finance Agency regulations limit the type of investments we may purchase, and we do not have any subsidiaries or equity positions in any partnerships, corporations, or off-balance sheet special purpose entities. The Finance Agency further limits our investments in MBS by requiring that the balance of our MBS not exceed three times regulatory capital at the time of purchase. For details on our compliance with this regulatory requirement, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Statements of Condition — Investments](#i6940522039644a7690f9aab973fdec20_97)</u>." For additional discussion on our investments and their related credit risk, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Credit Risk — Investments](#ia9c5fd5e2848466f9a0482fdb160304d_29194)</u>."

**Standby Bond Purchase Agreements**

We currently hold standby bond purchase agreements with state housing finance agencies within our district pursuant to which, for a fee, we agree to serve as a standby liquidity provider if required, to purchase and hold the bonds until the designated marketing agent can find a suitable investor or the state housing finance agency repurchases the bonds according to a schedule established by the agreement. Each standby bond purchase agreement includes the provisions under which we would be required to purchase the bonds and typically allows the Bank to terminate the agreement upon the occurrence of a default event of the issuer. If purchased, the bonds would be classified as AFS or trading securities on our Statements of Condition. For additional details on our standby bond purchase agreements, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 13 — Commitments and Contingencies](#i6940522039644a7690f9aab973fdec20_232)</u>."

**Deposits**

We accept uninsured deposits from our members, eligible housing associates, and/or counterparties. We offer deposit programs, including demand, overnight, and term deposits. Deposit programs provide us funding while providing members a low-risk, interest-earning asset.

**Consolidated Obligations**

Our primary source of funding and liquidity is the issuance of debt securities, referred to as consolidated obligations, in the capital markets. Consolidated obligations (bonds and discount notes) are the joint and several obligations of all FHLBanks and are backed only by the financial resources of the FHLBanks. They are not obligations of the U.S. Government, and the U.S. Government does not guarantee them. In May 2025, Moody's downgraded the long-term U.S. sovereign credit rating to Aa1 with a stable outlook. Following this action, Moody's also downgraded our long-term credit rating to Aa1 with a stable outlook and affirmed our P-1 short-term issuer credit rating. As of February 28, 2026, our consolidated obligations remained rated Aa1/P-1 by Moody's and AA+/A-1+ by S&P, with stable outlooks, and AA+ with a stable outlook by Fitch Ratings.

The FHLBanks' Office of Finance issues all consolidated obligations on behalf of the FHLBanks. It is also responsible for servicing all outstanding debt, coordinating transfers of debt between the FHLBanks, serving as a source of information for the FHLBanks on capital market developments, managing the FHLBank System's relationship with the rating agencies with respect to consolidated obligations, and preparing and making available the FHLBank System's Combined Financial Reports.

Although we are primarily responsible for the portion of consolidated obligations issued on our behalf, we are also jointly and severally liable with the other FHLBanks for the payment of principal and interest on all consolidated obligations. The Finance Agency, at its discretion, may require any FHLBank to make principal and/or interest payments due on any consolidated obligation, whether or not the primary obligor FHLBank has defaulted on the payment of that consolidated obligation. The Finance Agency has never exercised this discretionary authority.

To the extent that an FHLBank makes any payment on a consolidated obligation on behalf of another FHLBank, the paying FHLBank is entitled to reimbursement from the FHLBank otherwise responsible for the payment. However, if the Finance Agency determines that an FHLBank is unable to satisfy its obligations, then the Finance Agency may allocate the outstanding liability among the remaining FHLBanks on a pro-rata basis in proportion to each FHLBank's participation in all consolidated obligations outstanding, or on any other basis that it may determine.

The Finance Agency also requires each FHLBank to maintain unpledged qualifying assets, as defined by regulation, in an amount at least equal to the amount of that FHLBank's participation in the total consolidated obligations outstanding. For details on our compliance with this regulatory requirement, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Liquidity — Liquidity Requirements](#i57dfd06e31f94e2095e69a37b026d652_15616)</u>."

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BONDS

Bonds are generally issued to satisfy our short-, intermediate-, and long-term funding needs. They may have maturities ranging up to 30 years, although there is no statutory or regulatory limitation as to their maturity. Bonds are issued with either a fixed or variable rate, such as SOFR. To meet the specific needs of investors, both fixed and variable rate bonds may also contain certain embedded features, which result in complex coupon payment terms and/or call features. When bonds are issued on our behalf, we may concurrently enter into a derivative agreement to effectively convert the fixed rate payment stream to variable or to offset the embedded features in the bond.

Depending on the amount and type of funding needed, bonds may be issued through negotiated or competitively bid transactions with approved underwriters or selling group members (i.e., TAP Issue Program, auction, and Global Debt Program), or through debt transfers between FHLBanks.

The TAP Issue Program is used to issue fixed rate, non-callable bonds with maturities ranging up to 30 years. The goal of the TAP Issue Program is to aggregate frequent smaller bond issues into a larger bond issue that may have greater market liquidity.

An auction process is used to issue fixed rate, callable bonds. Auction structures are determined by the FHLBanks in consultation with the Office of Finance and the securities dealer community. We may receive zero to 100 percent of the proceeds of the bonds issued via the callable auction depending on (i) the amounts and costs for the bonds bid by underwriters, (ii) the maximum costs we or other FHLBanks participating in the same issue, if any, are willing to pay for the obligations, and (iii) the guidelines for allocation of bond proceeds among multiple participating FHLBanks administered by the Office of Finance.

The Global Debt Program allows the FHLBanks to diversify their funding sources to include overseas investors. Global Debt Program bonds may be issued in maturities ranging up to 30 years and can be customized with different terms and currencies. The FHLBanks approve the terms of the individual issues under the Global Debt Program.

DISCOUNT NOTES

Discount notes are generally issued to satisfy our short-term funding needs. They have maturities of up to one year and are offered daily through a discount note selling group and other authorized underwriters. Discount notes are generally sold at a discount and mature at par.

On a daily basis, we may request that specific amounts of discount notes with specific maturity dates be offered by the Office of Finance for sale through certain securities dealers. We may receive zero to 100 percent of the proceeds of the discount notes issued via this sales process depending on (i) the time of the request, (ii) the maximum costs we or other FHLBanks participating in the same issue, if any, are willing to pay for the discount notes, and (iii) the amount of orders for the discount notes submitted by dealers.

Twice weekly, we may request that specific amounts of discount notes with fixed maturities of four to 26 weeks be offered by the Office of Finance through competitive auctions conducted with securities dealers in the discount note selling group. One or more of the FHLBanks may also request that amounts of those same discount notes be offered for sale for their benefit through the same auction. The discount notes offered for sale through competitive auction are not subject to a limit on the maximum costs the FHLBanks are willing to pay. We may receive zero to 100 percent of the proceeds of the discount notes issued through a competitive auction depending on the amounts of the discount notes bid by underwriters and the guidelines for allocation of discount note proceeds among multiple participating FHLBanks administered by the Office of Finance.

For additional information on our consolidated obligations, see "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Statements of Condition — Consolidated Obligations](#i6940522039644a7690f9aab973fdec20_100)</u>" and "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Liquidity — Sources of Liquidity](#i57dfd06e31f94e2095e69a37b026d652_15615)</u>."

**Derivatives**

We use derivatives to manage interest rate risk. Finance Agency regulations and our risk management policies establish guidelines for derivatives, prohibit the speculative use of derivatives, and limit credit risk arising from derivatives. The goal of our interest rate risk management strategy is not to eliminate interest rate risk, but to manage it within appropriate limits.

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We can use interest rate swaps, swaptions, interest rate caps and floors, options, and future/forward contracts as part of our interest rate risk management strategies. These derivatives can be used as either a fair value hedge of a financial instrument or firm commitment or an economic hedge to manage certain defined risks. We use economic hedges primarily to (i) manage mismatches between the coupon features of our assets and liabilities, (ii) offset prepayment risk in certain assets, (iii) mitigate the income statement volatility that occurs when financial instruments are recorded at fair value and hedge accounting is not permitted by accounting guidance, or (iv) reduce exposure to reset risk.

Additional information on our derivatives can be found in "<u>[Item 8. Financial Statements and Supplementary Data — Note 7 — Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205)</u>" and "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Statements of Condition — Derivatives](#i6940522039644a7690f9aab973fdec20_112)</u>."

**CAPITAL AND DIVIDENDS**

**Capital Stock**

Our capital stock has a par value of $100 per share, and all shares are issued, redeemed, and repurchased only at the stated par value. We issue a single class of capital stock (Class B capital stock) and have two subclasses of Class B capital stock: membership and activity-based. Each member must purchase and hold membership capital stock in an amount equal to 0.06 percent of its total assets as of the preceding December 31<sup>st</sup>, subject to a cap of $10 million and a floor of $10,000. Each member is also required to purchase activity-based capital stock equal to 4.50 percent of its advances, 4.00 percent of mortgage loans outstanding, and 0.10 percent of its standby letters of credit. All capital stock issued is subject to a notice of redemption period of five years.

The capital stock requirements established in our Capital Plan are designed so that we can remain adequately capitalized as member activity changes. Our Board of Directors may make adjustments to the capital stock requirements within ranges established in our Capital Plan.

Capital stock owned by members in excess of their investment requirement is deemed excess capital stock. Under our Capital Plan, we, at our discretion and upon 15 days written notice, may repurchase excess membership capital stock. We, at our discretion, may also repurchase excess activity-based capital stock to the extent that (i) the excess capital stock balance exceeds an operational threshold set forth in the Capital Plan, which is currently set at zero, or (ii) a member submits a notice to redeem all or a portion of the excess activity-based capital stock.

We reclassify capital stock subject to redemption from equity to a liability, which represents MRCS, when a member provides written notice of intention to withdraw from membership, becomes ineligible for continuing membership, or attains non-member status by merger or consolidation, charter termination, or other involuntary termination from membership. Dividends on MRCS are classified as interest expense on the Statements of Income.

**Retained Earnings**

Our risk management policies outline a targeted level of retained earnings based on the amount we believe necessary to help protect the redemption value of capital stock, facilitate safe and sound operations, maintain regulatory capital ratios, and support our ability to pay a relatively stable dividend. We monitor our achievement of this targeted level and may utilize tools such as restructuring our balance sheet, generating additional income, reducing our risk exposures, increasing capital stock requirements, or reducing our dividends to achieve this level of retained earnings. At December 31, 2025 and 2024, our actual retained earnings exceeded our targeted level of retained earnings.

We entered into a JCE Agreement with all of the other FHLBanks in 2011. Under the JCE Agreement, we are required to allocate 20 percent of our quarterly net income to a separate restricted retained earnings account until the balance of that account, calculated as of the last day of each calendar quarter, equals at least one percent of our average balance of outstanding consolidated obligations for the calendar quarter. These restricted retained earnings are not available to pay dividends.

**Dividends**

Our Board of Directors may declare and pay different dividends for each subclass of capital stock. Dividend payments may be made in the form of cash and/or additional shares of capital stock. Historically, we have only paid cash dividends. By regulation, we may only pay dividends from current earnings or unrestricted retained earnings. We are prohibited from paying a dividend in the form of additional shares of capital stock if, after the issuance, the outstanding excess capital stock would be greater than one percent of our total assets. Our Board of Directors may not declare or pay dividends if it would result in our non-compliance with regulatory capital requirements.

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For additional information on our capital stock, retained earnings, and dividends, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Capital](#i57dfd06e31f94e2095e69a37b026d652_15617)</u>."

**HUMAN CAPITAL RESOURCES**

Our human capital is a significant contributor to the success of our strategic business objectives. In managing our human capital, we focus on our workforce profile and the various programs and philosophies described below.

**Workforce Profile**

Our workforce is primarily comprised of corporate employees, with our principal operations in one location. As of December 31, 2025, we had 357 employees, 352 full-time and five part-time. We strive to both develop talent from within the organization and supplement with external hires. As of December 31, 2025, the average tenure of our employees was eight years. There are no collective bargaining agreements with our employees.

**Total Rewards**

We seek to attract, develop, retain, and engage talented employees to create and implement strategies that are critical to our long-term success and ensure we bring value for our members. We affect this objective through a combination of development programs, benefits and employee wellness programs, and recognizing and rewarding performance. Specifically, our programs include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Cash compensation – includes competitive salary, other cash subsidies, and performance-based incentives;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Benefits – health insurance, life and accidental death and dismemberment insurance, supplemental life insurance, retirement plan benefits, and healthcare concierge;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Wellness program – lifestyle spending account, employee assistance program, interactive education sessions, online wellness portal, on-site gym, wellness incentive program, and ergonomic work environment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Time away from work – including PTO, holidays, and volunteer opportunities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Culture – Employee councils and business resource groups, community involvement, as well as various cultural initiatives;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Work/Life balance – short-term disability, parental and military leave, bereavement, jury duty, and court appearance leaves, as well as flexible scheduling and remote working options, including a hybrid working model;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Development programs and training – leadership development, mentoring program, employee engagement, educational assistance programs, online learning portal, professional competency exam reimbursement, internal education and development opportunities, fee reimbursement for external education, professional organization memberships, and development programs, including goals for developmental activities as part of performance management; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Management succession planning – our Board of Directors and leadership actively engage in management succession planning, with a defined plan for executive leadership roles.

Our Performance Management framework includes performance planning and goal-setting, ongoing coaching and feedback, and a mid-year and annual performance review. Overall annual performance ratings are calibrated and merit and incentive payments are differentiated for our highest performers.

**COMPETITION**

Our primary business activities are providing advances and acquiring residential mortgage loans from our members. These activities are funded through the issuance of consolidated obligations. We face competition for advances, mortgage loans, and funding from other institutions, including, but not limited to, investment banks, commercial banks, other GSEs, and U.S. Government agencies, including the Federal Reserve. For further discussion on our competition, refer to "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>."

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**TAXATION**

Under the FHLBank Act, we are exempt from all federal, state, and local taxation (except real property taxes and certain employer payroll taxes).

**AFFORDABLE HOUSING AND COMMUNITY INVESTMENT**

The FHLBank Act requires each FHLBank to establish and fund an AHP, which provides direct grants or subsidies for below-market rate advances to members who provide the funds to assist in the purchase, construction, or rehabilitation of affordable housing for very low-, low-, or moderate-income households. Annually, the FHLBanks recognize AHP assessment expense equal to the greater of 10 percent of their annual income subject to assessment, or their prorated portion of the sum required to ensure the aggregate contribution by the FHLBanks is no less than $100 million. For purposes of the statutory AHP assessment, income subject to assessment is defined as net income before AHP assessments, plus interest expense related to MRCS. We accrue the AHP assessment monthly based on our income subject to assessment and reduce our AHP liability as program funds are distributed. In addition to the required AHP assessment, our Board may elect to make voluntary contributions to the AHP. The income statement effects of our voluntary contributions reduce net income before assessments which, in turn, reduces the statutory AHP assessment each year. As such, we have committed to make supplemental voluntary contributions to AHP by an amount that equals what the statutory AHP assessment would be in the absence of these effects. In addition to the statutory assessment, during 2025 we voluntarily accrued $15 million for use in the AHP, including the supplemental voluntary contributions to AHP. For additional information on our AHP, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 10 — Affordable Housing Program](#i6940522039644a7690f9aab973fdec20_217)</u>."

In addition to our statutory AHP, we offer our members voluntary programs to further our housing mission and provide support for affordable housing and community development initiatives. These initiatives include, but are not limited to, our Member Impact Fund, Mortgage Rate Relief, Housing Affordability Advance (formerly known as the Habitat for Humanity<sup>®</sup> Advance Rate Discount), and additional voluntary contributions to AHP, as mentioned above. Our Member Impact Fund is a discretionary program in which we match member donations to local housing and community development organizations. Mortgage Rate Relief is designed to make homeownership attainable for borrowers at or below 80 percent of the area median income, by providing them an interest rate that is lower than the current market rate. In 2026, in recognition of the district and national need to expand the supply of affordable housing, we expanded our Habitat for Humanity<sup>®</sup> Advance Rate Discount to be the Housing Affordability Advance. The program continues to provide advances with an interest rate below the customary interest rate for non-subsidized advances with similar terms to members that originate or purchase mortgage loans from a Habitat for Humanity<sup>®</sup> affiliate, but is also available to non-depository CDFIs. Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations — Affordable Housing Program Assessments](#i6940522039644a7690f9aab973fdec20_79)</u>" and "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations — Supporting Housing and Community Investment](#i6940522039644a7690f9aab973fdec20_76)</u>" for details on our initiatives in 2025.

**OVERSIGHT, AUDITS, AND EXAMINATIONS**

Our business is subject to extensive regulation and supervision. The laws and regulations to which we are subject cover all key aspects of our business, including, but not limited to, our product and service offerings, pricing, competitive position and strategic plan, relationships with members and third parties, capital structure, liquidity, and information security. Our primary regulatory oversight is summarized below.

The Finance Agency supervises and regulates the FHLBanks and the Office of Finance. The Finance Agency has a statutory responsibility and corresponding authority to ensure that the FHLBanks operate in a safe and sound manner. Consistent with that duty, the Finance Agency has an additional responsibility to ensure the FHLBanks carry out their housing and community development finance mission. In order to carry out those responsibilities, the Finance Agency establishes regulations governing the FHLBanks, conducts ongoing off-site monitoring and supervisory reviews, performs periodic on-site examinations, and requires the FHLBanks to submit monthly and quarterly information regarding their financial condition, results of operations, and risk metrics.

The Comptroller General has authority under the FHLBank Act to audit or examine the Finance Agency and the FHLBanks and to decide the extent to which they fairly and effectively fulfill the purposes of the FHLBank Act. Furthermore, the Government Corporation Control Act provides that the Comptroller General may review any audit of an FHLBank's financial statements conducted by an independent registered public accounting firm. If the Comptroller General conducts such a review, then he or she must report the results and provide his or her recommendations to Congress, the Office of Management and Budget, and the FHLBank in question. The Comptroller General may also conduct his or her own audit of the financial statements of any FHLBank.

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As required by federal regulation, we have an internal audit department and an audit committee of our Board. An independent public accounting firm registered with the PCAOB audits our annual financial statements. Our independent registered public accounting firm, PricewaterhouseCoopers LLP, must adhere to PCAOB and Government Auditing Standards, as issued by the Comptroller General, when conducting our audits. Our Board, our senior management, and the Finance Agency receive these audit reports. We also submit annual management reports to Congress, the President of the United States, the Office of Management and Budget, and the Comptroller General. These reports include audited financial statements, a statement of internal accounting and administrative control systems, and the report of the independent registered public accounting firm on the financial statements.

For further discussion on the potential impacts of legislative and regulatory developments, refer to "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>" and "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Legislative and Regulatory Developments](#i6940522039644a7690f9aab973fdec20_121)</u>."

**AVAILABLE INFORMATION**

We are required to file with the SEC an annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. The SEC maintains a website containing these reports and other information regarding our electronic filings located at <u>www.sec.gov</u>*.* 

We also provide direct links from our website at www.fhlbdm.com to the SEC website for our annual reports, quarterly reports, current reports, and amendments to all such reports filed with or furnished to the SEC, as soon as reasonably practicable after such reports are available. Annual and quarterly reports for the FHLBanks on a combined basis are also available, free of charge, at the website of the Office of Finance as soon as reasonably practicable after such reports are available. The website address to obtain these reports is <u>www.fhlb-of.com</u>.

Information contained in the previously mentioned websites, or that can be accessed through those websites, is not incorporated by reference into this annual report on Form 10-K and does not constitute a part of this or any report filed with the SEC.

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**<u>ITEM 1A. RISK FACTORS</u>**

The following discussion summarizes some of the more significant risks we face. This discussion is not exhaustive, and there may be other risks we face, which are not described below. In particular, we may fail to identify and manage risks related to a variety of aspects of our business, including but not limited to, interest rate, liquidity, and legal, regulatory, and compliance risks. We have adopted controls, procedures, policies, and systems to monitor and manage these risks. Management cannot provide complete assurance that those controls, procedures, policies, and systems are adequate to identify and manage the risks inherent in our business. In addition, because our business continues to evolve, we may fail to fully understand the implications of changes in the business, and therefore, we may fail to enhance our risk governance framework to timely or adequately address those changes. This risk and any of the other risks described below, if realized, could negatively affect our business operations, financial condition, future results of operations, and among other things, could result in our inability to pay dividends on our capital stock or repurchase capital stock or adversely impact our reputation.

**<u>BUSINESS AND REGULATORY RISK</u>**

**WE ARE SUBJECT TO A COMPLEX BODY OF LAWS AND REGULATIONS THAT COULD CHANGE IN A MANNER DETRIMENTAL TO OUR BUSINESS OPERATIONS** 

The FHLBanks are GSEs, organized under the authority of the FHLBank Act and, as such, are governed by federal laws and regulations adopted and applied by the Finance Agency. Congress may amend the FHLBank Act or other statutes in ways that significantly affect the rights and obligations of the FHLBanks or the manner in which the FHLBanks carry out their mission and business operations. In addition, new or modified legislation enacted by Congress or changes in regulatory requirements applied or imposed by the Finance Agency could affect the composition of our membership and the extent to which members engage in business with us. There continue to be uncertainties surrounding our legislative and regulatory environment, and new or modified legislation enacted by Congress or regulations adopted or guidance issued by the Finance Agency or other financial services regulators.

Additionally, the FASB or SEC may amend financial accounting and reporting standards that govern our accounting and disclosure practices that may result in additional responsibilities or costs for us, such as compliance requirements, operational or technological changes, and increased disclosures.

For a discussion of new and proposed legislative and regulatory developments that could affect us, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Legislative and Regulatory Developments."](#i6940522039644a7690f9aab973fdec20_121)</u>

**FAILURE TO MEET MINIMUM CAPITAL AND OTHER REGULATORY REQUIREMENTS COULD ADVERSELY AFFECT OUR ABILITY TO REDEEM OR REPURCHASE CAPITAL STOCK, PAY DIVIDENDS, AND ATTRACT NEW MEMBERS**

We are regulated by the Finance Agency and if we fail to meet regulatory requirements, we could be subject to corrective action that could adversely impact our financial condition and results of operations. For example, we are required to maintain capital to meet specific minimum requirements, as defined by the Finance Agency. Historically, our capital has exceeded all capital requirements and we have maintained adequate capital and leverage ratios. If we fail to meet any of these requirements or if our Board of Directors or the Finance Agency determines that we have incurred, or are likely to incur, losses resulting in, or losses that are expected to result in, a charge against capital, we would not be able to redeem or repurchase any capital stock while such charges are continuing or expected to continue. In addition, failure to meet our capital requirements could result in the Finance Agency's imposition of restrictions pertaining to dividend payments, lending, investing, or other business activities. Additionally, the Finance Agency could require that we call upon our members to purchase additional capital stock to meet our minimum regulatory capital requirements. Members may be unable or unwilling to satisfy such calls for additional capital, which could lead to a member's involuntary termination of membership as a result of noncompliance with our Capital Plan, which could adversely impact our financial condition and results of operations.

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**WE FACE COMPETITION FOR ADVANCES, MORTGAGE LOANS, AND FUNDING**

Our primary business activities are providing advances to members and housing associates and acquiring residential mortgage loans from our members. Demand for our advances is affected by, among other things, the cost of other available sources of funding for our borrowers. We may from time to time compete with other suppliers of secured and unsecured wholesale funding including, but not limited to, investment banks, commercial banks, other GSEs, and U.S. Government agencies, including the Federal Reserve. We may compete with other FHLBanks to the extent that member institutions have affiliated institutions located outside of our district. Furthermore, our members may have access to customer deposits, brokered or reciprocal deposits, and resale agreements, all of which represent competitive alternatives to our advances.

Many of our competitors are not subject to the same body of regulation that we are, which may enable them to offer products and terms that we cannot. Efforts to effectively compete with other suppliers of wholesale funding by changing the pricing of our advances may result in a decrease in our profitability. The availability of alternative funding sources for our members could also change their perception of the value of FHLBank membership. A decrease in the demand for advances or a decrease in the profitability on advances could negatively affect our financial condition and results of operations.

The purchase of mortgage loans through the MPF program is subject to competition on the basis of prices paid for mortgage loans, customer service, and ancillary services, such as automated underwriting and loan servicing options. We compete primarily with other GSEs, such as Fannie Mae, Freddie Mac, other financial institutions, and private investors for acquisition of fixed rate mortgage loans. Increased competition could result in a reduction in the amount of mortgage loans we are able to purchase, which could negatively affect our financial condition and results of operations.

We also compete with the U.S. Government, Fannie Mae, Freddie Mac, and other GSEs as well as corporate, sovereign, and supranational entities for raising funds through the issuance of debt in the national and global markets. In the absence of increased demand, increased supply of competing debt products may result in higher debt costs or lesser amounts of debt issued at the same cost. An increase in funding costs would negatively affect our financial condition and results of operations.

**WE COULD BE ADVERSELY AFFECTED BY OUR EXPOSURE TO CUSTOMER CONCENTRATION RISK**

We are subject to customer concentration risk as a result of our reliance on a relatively small number of member institutions for a large portion of our total advances and resulting interest income. At December 31, 2025 and 2024, advances outstanding to our top five borrowers totaled $51.6 billion and $31.3 billion, representing 47 and 31 percent of our total advances outstanding. At December 31, 2025 and 2024, our single largest borrower, Athene Annuity and Life Company, accounted for 21 percent and 16 percent of total advances outstanding and for approximately 19 percent and nine percent of advance interest income for the years ended December 31, 2025 and 2024. Advance balances with members could change due to factors such as a change in member demand or borrowing capacity, which can be influenced by economic conditions, relocation of members out of our district, or members with affiliated institutions located outside of our district choosing to do business with another FHLBank. In addition, advance balances could change as a result of new or modified legislation impacting us or our members or regulations or other directives adopted by the Finance Agency or other financial services regulators. If we experience a decrease in the amount of business with our top five borrowers, our financial condition and results of operations could be negatively affected. Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Statements of Condition — Advances](#i6940522039644a7690f9aab973fdec20_91)</u>" for additional information on our top five borrowers.

**MEMBER CONSOLIDATIONS AND FAILURES COULD ADVERSELY AFFECT OUR BUSINESS**

Member consolidations and failures could reduce the number of current and potential members in our district. During 2025, our number of members declined slightly; however, if the number of member consolidations and/or failures were to accelerate, we could experience a reduction in the level of our members' advance and other business activities. This loss of business could negatively impact our business operations, financial condition, and results of operations.

**<u>MARKET AND LIQUIDITY RISK</u>**

**WE COULD BE ADVERSELY AFFECTED BY OUR INABILITY TO ACCESS THE CAPITAL MARKETS**

&nbsp;&nbsp;&nbsp;&nbsp;Our primary source of funds is through the issuance of consolidated obligations in the capital markets. Our ability to obtain funds through the issuance of consolidated obligations depends in part on our real and perceived relationship to the U.S. Government, prevailing market conditions in the capital markets, and rating agency actions, all of which are beyond our control. In addition, changes to the regulatory environment that affect bank counterparties, debt underwriters, and investors could adversely affect our ability to access the capital markets and the cost of that funding. We cannot make any assurance that we will be able to obtain funding on terms acceptable to us, if at all. For example, previous money market fund reform resulted in a significant increase in demand for U.S. government and agency debt, including our short-term consolidated obligations. &nbsp;&nbsp;&nbsp;&nbsp;

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While this increased demand benefited our ability to access short-term funding at attractive costs, there could be a scenario in which regulatory change may cause a decrease in demand that could lead to significant investor outflows and unfavorable market conditions due to our concentration in money market investors. Any further change in regulatory requirements governing money market funds, including any reversal of money market fund reforms, could negatively impact our short-term funding costs and strategies.

If we cannot access funding when needed, our ability to support and continue business operations, including our ability to refund maturing debt and maintain compliance with regulatory liquidity requirements, could be adversely impacted, which could adversely impact our financial condition and results of operations. Although our debt issuances have historically kept pace with the funding needs of our members and eligible housing associates, there can be no assurance that this will continue.

**CHANGES IN ECONOMIC CONDITIONS OR FEDERAL FISCAL AND MONETARY POLICY COULD ADVERSELY IMPACT OUR BUSINESS** 

We operate with narrow margins and our net income is sensitive to changes in market conditions that can impact the interest we earn and pay and introduce volatility in net income. These conditions include, but are not limited to, the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• volatility in interest rates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• fluctuations in both debt and equity capital markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in the fair value of our assets and liabilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• conditions in the financial, credit, mortgage, and housing markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the willingness and ability of financial institutions to expand lending; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the strength of the U.S. economy and the local economies in which we conduct business, which may be impacted by inflation/deflation, employment rates, and geopolitical instability or conflicts.

Our financial condition, results of operations, and ability to pay dividends could be negatively affected by changes in one or more of these conditions. Additionally, our business and results of operations may be affected by the fiscal and monetary policies of the federal government and its agencies, including the Federal Reserve, which regulates the supply of money and credit in the U.S. The Federal Reserve's policies directly and indirectly influence the yield on interest-earning assets and the cost of interest-bearing liabilities. For example, in response to changes in inflation and employment rates, the FOMC increased and subsequently decreased the target range for the federal funds rate in recent years. Any future rate changes will continue to impact our business as well as the business of our members.

Further events impacting market conditions, such as civil unrest or natural disasters, may impact the economy and require actions by the federal government and its agencies in an effort to stabilize market conditions. Responses to those actions and the resulting impact on demand for advances could adversely affect our financial condition, results of operations, and ability to pay dividends. Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Conditions in the Financial Markets](#i6940522039644a7690f9aab973fdec20_52)</u>" for additional information on recent market activity.

**WE COULD BE ADVERSELY AFFECTED BY INEFFECTIVE USE OF HEDGING STRATEGIES OR OUR INABILITY TO ENTER INTO DERIVATIVE INSTRUMENTS ON ACCEPTABLE TERMS**

We use derivatives to manage interest rate risk. Our effective use of derivative instruments depends upon management's ability to determine the appropriate hedging strategies and positions in light of our assets and liabilities as well as prevailing and anticipated market conditions. In addition, the effectiveness of our hedging strategies depends upon our ability to enter into derivatives with acceptable counterparties, on terms desirable to us, and in quantities necessary to hedge our corresponding assets and liabilities. Further, the cost of entering into derivative instruments could increase as a result of changes in legislation and regulations regarding over-the-counter derivatives, including increased margin and capital requirements, and increased regulatory costs and transaction fees associated with clearing and custodial agreements. If we are unable to manage our hedging positions properly, or are unable to enter into derivative instruments on desirable terms, we may incur higher funding costs and be unable to effectively manage our interest rate risk and other risks, which could negatively affect our financial condition and results of operation.

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**EXPOSURE TO OPTION RISK IN OUR FINANCIAL ASSETS AND LIABILITIES COULD HAVE AN ADVERSE EFFECT ON OUR BUSINESS**

Our mortgage assets provide homeowners the option to prepay their mortgages prior to maturity. The effect of changes in interest rates can exacerbate prepayment or extension risk, which is the risk that mortgage assets will be refinanced by the mortgagor in low interest rate environments or will remain outstanding longer than expected at below-market yields when interest rates increase. Our advances, consolidated obligations, and derivatives may provide us, the borrower, the issuer, or the counterparty with the option to call or put the asset or liability. These options leave us susceptible to unpredictable cash flows associated with our financial assets and liabilities. The exercise of the option and the prepayment or extension risk is dependent upon general market conditions and could have an adverse effect on our financial condition and results of operations.

**<u>CREDIT RISK</u>**

**WE COULD BE ADVERSELY AFFECTED BY OUR EXPOSURE TO CREDIT RISK**

We are exposed to credit risk based on the deterioration in the creditworthiness of the obligor or the credit quality of a security instrument. We assume unsecured and secured credit risk exposure in that a borrower or counterparty could default and we may suffer a loss if we are not able to fully recover amounts owed to us in a timely manner. Our risk of credit losses may be exacerbated by economic conditions, such as a downturn in the real estate markets, including a reduction in property values, higher delinquencies resulting from increased unemployment and the effect of mortgage forbearance and other relief, as well as financial difficulties due in part to the effects of inflation as well as financial difficulties or failures of mortgage servicers. In addition, increased risk of credit losses may be the result of a decrease in the value of collateral securing our advances or mortgage loans, which could be due to the effects of natural disasters or other catastrophic events.

We require full collateralization on all advances, standby letters of credit, applicable mortgage loan credit enhancements provided by PFIs, certain investments, and derivatives. We evaluate the types of collateral pledged by our borrowers and counterparties and assign a borrowing capacity to the collateral, generally based on a percentage of its unpaid principal balance or estimated market value, if available. We generally have the ability to call for additional or substitute collateral during the life of an obligation to ensure we are fully collateralized. Although these products are collateralized, a significant decline in the value of pledged collateral could lead to greater exposure to credit losses in the event of a member default.

In addition, we have credit risk exposure on unsecured liquidity investments. We transact these investments with highly-rated, investment-grade institutions, have limits on dollar and maturity exposure to each institution, and have strong credit underwriting practices. Notwithstanding these factors, we may still suffer losses that could adversely impact our financial condition and results of operations.

**WE ARE JOINTLY AND SEVERALLY LIABLE FOR THE CONSOLIDATED OBLIGATIONS OF OTHER FHLBANKS AND MAY BE REQUIRED TO PROVIDE FINANCIAL ASSISTANCE TO OTHER FHLBANKS** 

Each of the FHLBanks relies upon the issuance of consolidated obligations as a primary source of funds. Consolidated obligations are the joint and several obligations of the 11 FHLBanks and are backed only by the financial resources of the FHLBanks. They are not obligations of the U.S. Government, and the U.S. Government does not guarantee them. The Finance Agency, at its discretion, may require any FHLBank to make principal and/or interest payments due on any consolidated obligation, whether or not the primary obligor FHLBank has defaulted on the payment of that consolidated obligation. Furthermore, if the Finance Agency determines that an FHLBank is unable to satisfy its obligations, it may allocate the outstanding liability among the remaining FHLBanks on a pro-rata basis in proportion to each FHLBank's participation in all consolidated obligations outstanding, or on any other basis that it may determine. Accordingly, we could incur liability beyond our primary obligation under consolidated obligations, which could negatively affect our financial condition and results of operations. Moreover, we may not pay dividends to, or redeem or repurchase capital stock from, any of our members if timely payment of principal and interest on all FHLBank consolidated obligations has not been made. Accordingly, our ability to pay dividends or to redeem or repurchase capital stock may be affected not only by our financial condition, but by the financial condition of the other FHLBanks.

Due to our relationship with other FHLBanks, we could also be impacted by events other than the default on a consolidated obligation. Events that impact other FHLBanks include, but are not limited to, member failures and capital deficiencies. These events may cause the Finance Agency, at its discretion, to require any FHLBank to either provide capital to or buy assets of any other FHLBank. If we are called upon by the Finance Agency to do either of these items, it may negatively impact our financial condition.

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Additionally, the FHLBank Act requires each FHLBank to establish and fund an AHP. Annually, the FHLBanks recognize AHP assessment expense, in aggregate, equal to the greater of $100 million or 10 percent of their current year earnings. If the FHLBanks do not make the minimum $100 million AHP contribution in a given year (i.e., a shortfall), we could be required to contribute more than 10 percent of our current year net earnings. An increase in our AHP contributions due to a shortfall or other legislative or regulatory actions could impact our financial condition and results of operations as well as our ability to pay dividends.

**ACTUAL OR PERCEIVED CHANGES IN THE FHLBANKS' CREDIT RATINGS AS WELL AS THE U.S. GOVERNMENT'S CREDIT RATING COULD ADVERSELY AFFECT OUR BUSINESS**

Our consolidated obligations are currently rated AA+/A-1+ with a stable outlook by S&P and Aa1/P-1 with a stable outlook by Moody's. In addition, our consolidated obligations are currently rated AA+ with a stable outlook by Fitch Ratings. These ratings are subject to reduction or withdrawal at any time by a NRSRO, and the FHLBank System may not be able to maintain these credit ratings. For example, in May 2025, Moody's downgraded the long-term U.S. sovereign credit rating to Aa1 with a stable outlook. Following this action, Moody's also downgraded our long-term credit rating to Aa1 with a stable outlook and affirmed our P-1 short-term issuer credit rating. Adverse rating agency actions on the FHLBank System or U.S. Government may reduce investor confidence and negatively affect our cost of funds and ability to issue consolidated obligations on acceptable terms, which could adversely impact our financial condition and results of operations.

Certain products and transactions that we offer or use may be impacted by rating downgrades. Demand for certain Bank products, including, but not limited to, standby letters of credit and standby bond purchase agreements, is influenced by our credit rating. A reduction in our credit rating could weaken or eliminate demand for such products, and our financial condition and results of operations could be adversely affected. For cleared derivatives, the clearinghouse determines initial margin requirements and generally credit ratings are not factored into the initial margin. However, clearing agents may require additional initial margin to be posted based on credit considerations, including but not limited to, credit rating downgrades.

**INCREASES IN DELINQUENCY OR LOSS ESTIMATES ON OUR MORTGAGE LOANS MAY HAVE AN ADVERSE IMPACT ON OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

The condition of the U.S. housing market can have a significant impact on the Bank. If economic conditions weaken and result in increased unemployment and a decline in home prices, we could see an increase in loan delinquencies or loss estimates and decide to increase our allowance for credit losses on mortgage loans. In addition, the occurrence of weather-related events, other natural or environmental disasters, civil unrest, widespread health emergencies, or other disruptive events could impact the ability of borrowers to continue to make principal and interest payments on mortgage loans or cause a decline in the underlying value of the mortgage loans, resulting in additional loss estimates. Further, to the extent that mortgage insurance providers fail to fulfill their obligations to pay us for claims, we could bear additional losses on certain mortgage loans with outstanding mortgage insurance coverage. As a result, our financial condition and results of operations could be adversely impacted.

**<u>OPERATIONAL RISK</u>**

**FAILURES OR INTERRUPTIONS IN INTERNAL CONTROLS, INFORMATION SYSTEMS, AND OTHER OPERATING TECHNOLOGIES COULD HARM OUR FINANCIAL CONDITION, RESULTS OF OPERATIONS, REPUTATION, AND RELATIONS WITH MEMBERS** 

Control failures, including failures in our controls over financial reporting, or business interruptions with members, could result from human error, fraud, breakdowns in information and computer systems, lapses in operating processes, natural or man-made disasters, civil unrest, or widespread health emergencies. If a significant control failure or business interruption were to occur, it could materially damage our financial condition and results of operations. We may not be able to foresee, prevent, mitigate, reverse, or repair the negative effects of such failures or interruptions.

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We rely heavily upon information systems and other operating technologies to conduct and manage our business. To the extent that our technology fails to keep up with changing environments, we may be unable to conduct and manage our business effectively. In addition, any technical failures or interruptions in key systems or other operating technologies, including any "cyberattacks" or other breaches of technical security, could jeopardize the confidentiality or integrity of our information, or otherwise cause interruptions in our operations. These threats may increase as a result of the increased capabilities of artificial intelligence and other emerging technologies that may be used maliciously, as well as geopolitical instability or conflicts. Although we have implemented a disaster recovery and business continuity plan, we can make no assurance that it will be able to prevent, timely and adequately address, or mitigate the negative effects of all technical failures or interruptions. Any technical failure or interruption could harm our member relations, risk management, and profitability, and could adversely impact our financial condition and results of operations. Refer to "<u>[Item 1C. Cybersecurity](#i6940522039644a7690f9aab973fdec20_25)</u>" for additional information on our information security risk management.

**RELIANCE ON THIRD PARTIES COULD HAVE A NEGATIVE IMPACT ON OUR BUSINESS**

As part of our business, we rely on third parties for certain services essential to ongoing operations, including but not limited to, IT infrastructure and software services, administration of our mortgage loan program, and servicing of our consolidated obligations, and could be adversely impacted by disruptions in those services. In addition, we utilize professional and contractual services to support certain strategic initiatives. The success or timing of those initiatives could be adversely impacted if services are not performed or executed as expected.

We participate in the MPF program with the FHLBank of Chicago. In its role as MPF Provider, the FHLBank of Chicago provides the infrastructure and operational support for the MPF program and is responsible for publishing and maintaining the MPF Guides, which detail the requirements PFIs must follow in originating, selling, and servicing MPF loans. If the FHLBank of Chicago changes its MPF Provider role, ceases to operate the MPF program, or experiences a failure or interruption in its information systems and other technology, our mortgage purchase business could be adversely affected, and we could experience a related decrease in our net interest margin and profitability. In the same way, we could be adversely affected if any of the FHLBank of Chicago's third-party vendors supporting the operation of the MPF program were to experience operational or technical difficulties.

We also rely on the Office of Finance for, among other things, the issuance of consolidated obligations, servicing of all outstanding debt, and managing the FHLBank System's relationship with the rating agencies with respect to consolidated obligations. A disruption in any of these services due to events such as IT or operational failures, including cyber-attacks, civil unrest, or natural disasters, could affect our ability to access funding, and could negatively impact our business operations, financial condition, and results of operations.

**FINANCIAL MODELS AND THE UNDERLYING ASSUMPTIONS USED TO VALUE FINANCIAL INSTRUMENTS AND COLLATERAL MAY HAVE AN ADVERSE IMPACT ON OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

The degree of management judgment involved in determining the fair value of financial instruments or collateral is dependent upon the availability of quoted market prices or observable market parameters. For financial instruments and collateral that are actively traded and have quoted market prices or parameters readily available, there is little to no subjectivity in determining fair value. If market quotes are not available, fair values are based on discounted cash flows using market estimates of interest rates and volatility or on dealer prices or prices of similar instruments. We utilize external and internal pricing models to determine the fair value of certain financial instruments and collateral. For prices obtained externally, as per our established procedure, we review the prices and compare them to other vendors for reasonableness. In addition, on an annual basis, we conduct reviews of our pricing vendors to confirm and further augment our understanding of the vendors' pricing processes, methodologies, and control procedures for investment securities. For prices determined by internal pricing models, the underlying assumptions are based on management's best estimates for discount rates, prepayments, market volatility, and other factors.

The assumptions used in both external and internal pricing models could have a significant effect on the reported fair values of assets and liabilities or collateral, the related income and expense, and the expected future behavior of assets and liabilities or collateral. While models we use to value financial instruments and collateral are subject to periodic validation by independent parties, rapid changes in market conditions could impact the value of our financial instruments and collateral. The use of different models and assumptions, as well as changes in market conditions, could impact our financial condition and results of operations as well as the amount of collateral we require from borrowers and counterparties.

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The information provided by our internal financial models is also used in making business decisions relating to strategies, initiatives, transactions, and products. We have adopted controls, procedures, and policies to monitor and manage assumptions used in our internal models. However, models are inherently imperfect predictors of actual results because they are based on assumptions about future performance or activities. Changes in any models or in any of the assumptions, judgments, or estimates used in the models may cause the results generated by the model to be materially different. If the results are not reliable due to inaccurate assumptions, we could make poor business decisions, including asset and liability management, or other decisions, which could result in an adverse financial impact.

**<u>GENERAL RISK FACTORS</u>**

**THE INABILITY TO ATTRACT AND RETAIN KEY PERSONNEL COULD ADVERSELY IMPACT OUR BUSINESS**

We rely heavily upon our employees in order to successfully execute our business and strategies. The success of our business mission depends, in large part, on our ability to attract and retain key personnel with required talents and skills. We may be unable to hire or retain key personnel with the needed talents or skills if we fail to offer a competitive employment package and work arrangements. In addition, if we fail to develop and execute a succession plan, our business operations could be adversely impacted.

**NATURAL DISASTERS COULD ADVERSELY AFFECT OUR MEMBERS AND OUR BUSINESS, FINANCIAL CONDITION, AND RESULTS OF OPERATIONS**

The occurrence of weather-related events and other natural or environmental disasters, especially ones affecting our district, could negatively impact our members and business, financial condition, and results of operations. The frequency, intensity, and duration of extreme weather disaster events have increased. These natural disasters could destroy or damage our facilities or other properties of our members (such as collateral that members have pledged to secure advances or mortgages), disrupt business, increase the probability of power or other outages, negatively affect the livelihood of borrowers of members, or otherwise cause significant economic dislocation in the affected regions. Any of these situations may adversely affect our financial condition and results of operations.

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**<u>ITEM 1B. UNRESOLVED STAFF COMMENTS</u>**

None.

**<u>ITEM 1C. CYBERSECURITY</u>**

**RISK MANAGEMENT AND STRATEGY**

Information security risk includes the risk that cyber incidents and threats could result in a failure or interruption of our business operations. A cybersecurity incident is an unauthorized occurrence, or a series of related unauthorized occurrences, through information systems that jeopardizes the confidentiality, integrity, or availability of our information systems or any information residing therein. Cybersecurity threats are potential unauthorized occurrences on or conducted through information systems that may result in adverse effects on the confidentiality, integrity, or availability of information systems or any information residing therein. Information systems are any electronic information resources, owned or used by us, including physical or virtual infrastructure controlled by such information resources, or their components, organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of our information to maintain or support our operations. We have implemented processes to identify, assess, and manage material risks from cybersecurity incidents or threats that may directly or indirectly impact our business strategy, results of operations, or financial condition. Please refer to "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>" for additional information on our operational risk, which includes the risk of failures or interruptions in information systems resulting from cybersecurity threats or incidents.

Our cybersecurity program is designed to identify, assess, and manage material risks from cybersecurity threats and to protect the confidentiality, integrity, and availability of our IT assets and data. We utilize a widely adopted industry framework to guide and benchmark the activities of our information security program in alignment with our risk appetite statement. Our cybersecurity program includes specific controls and processes for the monitoring, mitigation, and reporting associated with cybersecurity risks. For example, administrative, physical, and logical controls are in place for identifying, monitoring, and controlling system access, sensitive data, and system changes. In addition, we employ an information security training program that includes security training lessons and phishing exercises for all employees as well as mandatory staff training on cyber risks. We also regularly engage with third-parties to test, maintain, and enhance our cybersecurity risk management practices and threat monitoring. These engagements include, among other things, penetration testing, detection and response services, cybersecurity tabletops, and cybersecurity framework assessments. We also maintain cyber insurance coverage in an effort to reduce financial losses stemming from a security incident.

To ensure the continuance of our operations in the event of a cybersecurity incident or threat, we have established an Information Security Policy and Security Incident Response Plan, and have adopted a business continuity management program.

Our Information Security Policy establishes administrative, technical, and physical safeguards designed to protect the security, confidentiality, and integrity of Bank information in accordance with Finance Agency regulations, the Gramm-Leach-Bliley Act and the interagency guidelines issued thereunder, and applicable laws.

Our Security Incident Response Plan determines how cybersecurity threats and incidents are identified, classified, and escalated, including for the purposes of reporting, and providing relevant information to senior management and the Board of Directors. The Security Incident Response Plan requires management to assess materiality of the threat or incident for purposes of public disclosure.

Our Security Incident Response Plan includes third-party cybersecurity incidents and threats, as we do rely on third-party information systems and other technologies. As part of our vendor risk management process, we undertake due diligence of third-party systems with whom we interact, including risk profiling and classification, in addition to requiring data protection covenants in our vendor agreements. Our vendor risk management program includes regular reviews and oversight of service providers, including performance and technology reviews, and escalation of any unsatisfactory reviews.

Our business continuity management program is designed to ensure that necessary resources are in place to protect us from potential loss during a disruption, which includes the unavailability of IT assets due to unintentional events like fire, power loss, and other technical incidents, such as hardware failures.

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During the period covered by this report, risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, did not have a material impact on our business strategy, results of operations, or financial condition. Cybersecurity incidents may occur in the future and any such cybersecurity incident could result in significantly harmful consequences to us, our members, and their customers. We are prepared to assess materiality of any such cybersecurity incident from several perspectives including, but not limited to, our ability to continue to service our members and protect the privacy of the data they or their customers have entrusted to us, lost revenue, disruption of business operations, increased operating costs, litigation, and reputational harm.

**GOVERNANCE**

Our Information Security Department is led by the CIOO, who reports to the President and CEO. Our CIOO establishes our strategic direction and provides executive support for our information security program, and has significant experience in information systems and information security. Refer to "<u>[Item 10. Directors, Executive Officers and Corporate Governance](#i6940522039644a7690f9aab973fdec20_265)</u>" for more information.

Our dedicated Information Security Department is comprised of specialized professionals responsible for the day-to-day, hands-on management of cybersecurity risk, including the processes and procedures to mitigate and implement protective, proactive, and reactive measures to protect us against this risk. Personnel in this department hold a variety of technical certifications relevant to their job functions and engage in continuing education. This department is also responsible for developing, documenting, and approving our technical information security control standards, guidelines, and procedures designed to preserve the confidentiality, integrity, and availability of our IT assets and data under our control.

Our Technology and Operations Committee provides independent and integrated oversight over our information security program, physical security program, business continuity program, security policies and procedures, and security exceptions and violations. This committee is comprised of leadership representatives from our operational risk, information security, IT, and legal departments, as well as other departments that provide both specific technical and multidisciplinary expertise to the committee. This committee is responsible for reviewing and approving our Information Security Policy, prior to submission to the Board's Technology Committee. It also receives regular, prompt, and periodic information from the Information Security Department, which in turn provides periodic, regular, and prompt reporting to the Technology Committee of the Board of Directors on topics such as threat intelligence, major cybersecurity risk areas, technologies and best practices, and any cybersecurity incidents that may have impacted us, as well as risk assessment, management, and monitoring updates, as applicable or needed.

Our Board of Directors is responsible for the oversight of our information security program and establishes our information security risk appetite. The Technology Committee of our Board approves certain Bank-wide governing policies, including our Information Security Policy. It also oversees the development of mitigation plans, monitors the tactical implementation of policy, and reviews detailed risk assessments.

Our Board of Directors receives regular presentations and reports throughout the year on cybersecurity and information security addressing a broad range of topics. These topics include, but are not limited to, updates on technology trends, regulatory developments, legal issues, policies and practices, information security resources, environmental threats and vulnerability assessments, and efforts to prevent, detect, and respond to potential gaps, internal and external incidents, and critical threats. Our CIOO meets regularly with our Board of Directors to discuss cybersecurity and information security risks. Our Board of Directors is also required to complete cybersecurity training and participate in a cloud computing education session annually. Our policies and processes are designed such that the Board of Directors would receive prompt and timely information from Bank management on any cybersecurity or information security incident or threat that may pose significant risk to us and would continue to receive regular reports on any incident until its conclusion.

**<u>ITEM 2. PROPERTIES</u>**

Our headquarters is located at 909 Locust Street, Des Moines, Iowa. We currently occupy 94,000 of the approximate 226,000 square feet of office space, and have leased or are in the process of leasing the remaining space. We also lease an off-site back-up facility with approximately 3,500 square feet in Urbandale, Iowa, and approximately 3,000 square feet of office space in Washington, D.C. to support government relations, which is shared with two other FHLBanks.

**<u>ITEM 3. LEGAL PROCEEDINGS</u>**

Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 13 — Commitments and Contingencies](#i6940522039644a7690f9aab973fdec20_232)</u>" for information regarding legal proceedings.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**<u>ITEM 4. MINE SAFETY DISCLOSURES</u>**

Not applicable.

**<u>PART II</u>**

**<u>ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES</u>**

We are a cooperative. This means we are owned by our customers, whom we call members. Our current and former members own all of our outstanding capital stock. Our capital stock is not publicly traded and has a par value of $100 per share. All shares are issued, redeemed, or repurchased by us at the stated par value. Our capital stock may be redeemed with a five year notice from the member or voluntarily repurchased by us at par value, subject to certain limitations set forth in our Capital Plan. At February 28, 2026, we had 1,216 current members that held 72 million shares of capital stock and 20 former members that held one million shares of MRCS.

For information on our dividends, see "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Capital — Dividends](#i57dfd06e31f94e2095e69a37b026d652_15614)</u>."

**<u>ITEM 6. [RESERVED]</u>** 

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

&nbsp;&nbsp;&nbsp;&nbsp;

**<u>ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</u>**

Our MD&A is designed to provide information that will help the reader develop a better understanding of our financial statements, changes in our financial statements from year to year, and the primary factors driving those changes. Readers also should carefully review "<u>[Forward-Looking Information](#i6940522039644a7690f9aab973fdec20_10)</u>" and "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>" for a description of the forward-looking statements contained in this annual report on Form 10-K and a discussion of the factors that might cause our actual results to differ, perhaps materially, from these forward-looking statements. Unless expressly stated otherwise, the comparisons presented in this MD&A refer to the year-over-year comparison of changes in our financial condition and results of operations as of and for the years ended December 31, 2025 and December 31, 2024. Discussion of 2023 items and the year-over-year comparison of changes in our financial condition and results of operations as of and for the years ended December 31, 2024 and December 31, 2023 can be found in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" of our 2024 Form 10-K, filed with the SEC on March 7, 2025.

Our MD&A is organized as follows:

---

| | |
|:---|:---|
| **CONTENTS** | **CONTENTS** |
| [Executive Overview](#i6940522039644a7690f9aab973fdec20_49) | [26](#i6940522039644a7690f9aab973fdec20_49) |
| [Conditions in the Financial Markets](#i6940522039644a7690f9aab973fdec20_52) | [27](#i6940522039644a7690f9aab973fdec20_52) |
| [Selected Financial Data](#i6940522039644a7690f9aab973fdec20_55) | [28](#i6940522039644a7690f9aab973fdec20_55) |
| [Results of Operations](#i6940522039644a7690f9aab973fdec20_58) | [29](#i6940522039644a7690f9aab973fdec20_58) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Net Interest Income](#i6940522039644a7690f9aab973fdec20_64) | [29](#i6940522039644a7690f9aab973fdec20_64) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Other Income (Loss)](#i6940522039644a7690f9aab973fdec20_67) | [31](#i6940522039644a7690f9aab973fdec20_67) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Hedging Activities](#i6940522039644a7690f9aab973fdec20_70) | [31](#i6940522039644a7690f9aab973fdec20_70) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Other Expense](#i6940522039644a7690f9aab973fdec20_73) | [34](#i6940522039644a7690f9aab973fdec20_73) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Supporting Housing and Community Investment](#i6940522039644a7690f9aab973fdec20_76) | [34](#i6940522039644a7690f9aab973fdec20_76) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Affordable Housing Program Assessments](#i6940522039644a7690f9aab973fdec20_79) | [35](#i6940522039644a7690f9aab973fdec20_79) |
| [Statements of Condition](#i6940522039644a7690f9aab973fdec20_82) | [37](#i6940522039644a7690f9aab973fdec20_82) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Advances](#i6940522039644a7690f9aab973fdec20_91) | [37](#i6940522039644a7690f9aab973fdec20_91) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Mortgage Loans](#i6940522039644a7690f9aab973fdec20_94) | [39](#i6940522039644a7690f9aab973fdec20_94) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Investments](#i6940522039644a7690f9aab973fdec20_97) | [40](#i6940522039644a7690f9aab973fdec20_97) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Consolidated Obligations](#i6940522039644a7690f9aab973fdec20_100) | [42](#i6940522039644a7690f9aab973fdec20_100) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits | [43](#i6940522039644a7690f9aab973fdec20_103) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Capital](#i6940522039644a7690f9aab973fdec20_109) | [44](#i6940522039644a7690f9aab973fdec20_109) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Derivatives](#i6940522039644a7690f9aab973fdec20_112) | [44](#i6940522039644a7690f9aab973fdec20_112) |
| [Liquidity and Capital Resources](#i6940522039644a7690f9aab973fdec20_115) | [44](#i6940522039644a7690f9aab973fdec20_115) |
| [Critical Accounting Estimates](#i6940522039644a7690f9aab973fdec20_118) | [48](#i6940522039644a7690f9aab973fdec20_118) |
| [Legislative and Regulatory Developments](#i6940522039644a7690f9aab973fdec20_121) | [50](#i6940522039644a7690f9aab973fdec20_121) |
| [Off-Balance Sheet Arrangements](#i6940522039644a7690f9aab973fdec20_124) | [50](#i6940522039644a7690f9aab973fdec20_124) |
| [Risk Management](#i6940522039644a7690f9aab973fdec20_130) | [51](#i6940522039644a7690f9aab973fdec20_130) |

---

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**EXECUTIVE OVERVIEW**

**Liquidity Mission**

We provide liquidity to our members to support the housing, business, and economic development needs of their communities. Members pledge mortgage loans and other collateral to access our core liquidity products of advances, letters of credit, and mortgage loans held for portfolio under the MPF program. During the year ended December 31, 2025, advance balances averaged $108.1 billion, letters of credit averaged $18.4 billion, mortgage loan balances averaged $13.2 billion, and we held an average of $29.9 billion of short-term assets as a ready source of liquidity for our members.

**Affordable Housing and Community Impact**

Our housing and community development programs are central to our mission. We contribute 10 percent of our net income each year to our AHP, a grant program that supports the creation, rehabilitation, or purchase of affordable housing. This program includes a competitive AHP and two down payment assistance products called Home$tart and the Native American Homeownership Initiative. During the year ended December 31, 2025, we accrued statutory AHP assessments of $98 million and voluntarily accrued $15 million, to be awarded through this program.

In addition to our AHP, we offer our members voluntary programs to further our housing mission. During the year ended December 31, 2025, we recorded a total of $78 million in voluntary community and housing contributions, including the voluntary AHP contribution. Through our voluntary programs during 2025, we:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• provided $23 million in 0% rate advances to members that originated or purchased mortgage loans from a Habitat for Humanity<sup>®</sup> affiliate and recorded $5 million in subsidy expense;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• funded $346 million of home mortgages with an interest rate lower than the current market rate under the Mortgage Rate Relief program, which provided $30 million in grants for those seeking affordable homeownership;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• recorded contributions of $26 million to our Member Impact Fund to match member donations to local housing and community development organizations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• provided $2 million in support of communities impacted by floods in Alaska.

**Financial Results**

Our financial condition and results of operations are influenced by global and national economies, local economies within our district, and the conditions in the financial, housing, and credit markets, all of which impact the interest rate environment. The interest rate environment significantly impacts our profitability. FOMC actions in response to inflation, as well as trade disruptions, such as those arising from tariffs imposed or proposed by the U.S. or its trading partners, impact the interest rate environment, and in turn, our net interest income. Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Conditions in the Financial Markets](#i6940522039644a7690f9aab973fdec20_52)</u>" for additional discussion on economic conditions, including interest rates, impacting our financial results.

In 2025, we reported net income of $881 million compared to $914 million in the prior year.

Net interest income decreased $86 million when compared to the prior year primarily due to the yield on interest-earning assets declining quicker than the cost of interest-bearing liabilities driven primarily by changes in interest rates, which also reduced earnings on invested capital, and a decrease in certain longer-term advances. The decline in net interest income was offset in part by mortgage loan and MBS portfolio growth, as well as the call of higher-costing consolidated obligation bonds.

Other income (loss) increased $63 million when compared to the prior year primarily due to the net changes in the fair value of our trading securities, fair value option instruments, and economic derivatives, including the related interest settlements.

Other expense increased $12 million when compared to the prior year primarily due to an increase in voluntary community and housing contributions.

Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations](#i6940522039644a7690f9aab973fdec20_58)</u>" for additional discussion on our results of operations.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

Our total assets increased to $186.5 billion at December 31, 2025, from $165.3 billion at December 31, 2024, driven primarily by an increase in advances and investments. Advances increased $10.3 billion due mainly to an increase in borrowings by large depository institution members and insurance companies. Investments increased $9.0 billion due in part to an increase in securities purchased under agreements to resell, as well as the purchase of agency MBS and U.S. Treasury obligations.

Total capital increased to $10.5 billion at December 31, 2025, from $9.5 billion at December 31, 2024, primarily due to an increase in activity-based capital stock resulting from an increase in advance balances. Our regulatory capital ratio decreased to 5.54 percent at December 31, 2025, from 5.74 percent at December 31, 2024, but remained above the required regulatory limit at each period end. Regulatory capital includes capital stock, MRCS, and retained earnings.

Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Statements of Condition](#i6940522039644a7690f9aab973fdec20_82)</u>" for additional discussion on our financial condition.

**CONDITIONS IN THE FINANCIAL MARKETS**

**Economy and Financial Markets**

In late 2024 and continuing into 2025, the FOMC began reducing the target range for the federal funds rate, in light of the progress on inflation. The FOMC reduced the target range for the federal funds rate by 0.25 percent in October 2025, and an additional 0.25 percent in December 2025, to a range of 3.50 to 3.75 percent. In December 2025, the FOMC stated that recent indicators suggest that economic activity has been expanding at a moderate pace. Job gains have slowed this year, and the unemployment rate has edged up. In addition, inflation has moved up and remains somewhat elevated. More recently, in January 2026, the FOMC maintained the target range for the federal funds rate and stated that the unemployment rate has shown some signs of stabilization.

The following table shows information on key market interest rates<sup>1</sup>:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | 12-Month Average | 12-Month Average | Period End | Period End |
| | December 31, 2025 | December 31, 2024 | December 31, 2025 | December 31, 2024 |
| Federal funds | 4.21% | 5.15% | 3.64% | 4.33% |
| SOFR | 4.24 | 5.15 | 3.87 | 4.49 |
| 2-year U.S. Treasury | 3.81 | 4.37 | 3.47 | 4.25 |
| 10-year U.S. Treasury | 4.29 | 4.21 | 4.18 | 4.58 |
| 30-year residential mortgage note | 6.60 | 6.72 | 6.15 | 6.85 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Source: Bloomberg.

**Mortgage Markets**

During 2025, mortgage rates were lower compared to 2024; however, remained elevated. The primary driver of activity within the mortgage markets during 2025 was home purchases. New and existing home sales increased relative to the prior year, as well as home prices and prepayment activity.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**SELECTED FINANCIAL DATA**

The following tables present selected financial data for the periods indicated (dollars in millions):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | December 31, | December 31, | December 31, | December 31, | December 31, |
| **Statements of Condition** | 2025 | 2024 | 2023 | 2022 | 2021 |
| Cash and due from banks | $44 | $41 | $31 | $89 | $295 |
| Investments<sup>1</sup> | 61015 | 52032 | 49828 | 43381 | 33442 |
| Advances | 110230 | 99951 | 122530 | 111202 | 44111 |
| Mortgage loans held for portfolio, net<sup>2</sup> | 14540 | 11896 | 9967 | 8348 | 7578 |
| Total assets | 186499 | 165253 | 184406 | 164169 | 85852 |
| Consolidated obligations |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Discount notes | 84620 | 64680 | 54537 | 69170 | 22348 |
| &nbsp;&nbsp;&nbsp;Bonds | 89249 | 88571 | 116961 | 84337 | 55205 |
| Total consolidated obligations<sup>3</sup> | 173869 | 153251 | 171498 | 153507 | 77553 |
| Mandatorily redeemable capital stock | 30 | 9 | 12 | 15 | 29 |
| Total liabilities | 176012 | 155802 | 174575 | 155418 | 80014 |
| Capital stock — Class B putable | 6509 | 5989 | 6873 | 6250 | 3364 |
| Retained earnings | 3797 | 3491 | 3138 | 2618 | 2390 |
| Accumulated other comprehensive income (loss) | 181 | (29) | (180) | (117) | 84 |
| Total capital | 10487 | 9451 | 9831 | 8751 | 5838 |
| Regulatory capital ratio<sup>4</sup> | 5.54 | 5.74 | 5.44 | 5.41 | 6.74 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| **Statements of Income** | 2025 | 2024 | 2023 | 2022 | 2021 |
| Net interest income | $1150 | $1236 | $1306 | $683 | $381 |
| Provision (reversal) for credit losses on mortgage loans | 1 | (1) | 1 | 4 |  |
| Other income (loss)<sup>5</sup> | 100 | 37 | (15) | (40) | 4 |
| Voluntary community and housing contributions | 78 | 68 | 47 | 3 |  |
| All other expense<sup>6</sup> | 192 | 190 | 174 | 158 | 156 |
| AHP assessments | 98 | 102 | 107 | 48 | 23 |
| Net income | 881 | 914 | 962 | 430 | 206 |
| **Selected Financial Ratios** |  |  |  |  |  |
| Net interest spread<sup>7</sup> | 0.37% | 0.41% | 0.43% | 0.48% | 0.39% |
| Net interest margin<sup>8</sup> | 0.62 | 0.70 | 0.72 | 0.61 | 0.44 |
| Return on average equity | 8.71 | 9.52 | 10.30 | 6.33 | 3.48 |
| Return on average capital stock | 13.84 | 14.56 | 14.41 | 9.78 | 5.92 |
| Return on average assets | 0.47 | 0.51 | 0.52 | 0.38 | 0.23 |
| Average equity to average assets | 5.41 | 5.36 | 5.02 | 6.02 | 6.73 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Investments include interest-bearing deposits, securities purchased under agreements to resell, federal funds sold, trading securities, AFS securities, and HTM securities.

2&nbsp;&nbsp;&nbsp;&nbsp;Includes an allowance for credit losses of $6 million, $5 million, $6 million, $5 million, and $1 million at December 31, 2025, 2024, 2023, 2022, and 2021.

3&nbsp;&nbsp;&nbsp;&nbsp;The total par value of outstanding consolidated obligations of the 11 FHLBanks was $1,151.8 billion, $1,193.0 billion,$1,204.3 billion, $1,181.7 billion, and $652.9 billion at December 31, 2025, 2024, 2023, 2022, and 2021.

4&nbsp;&nbsp;&nbsp;&nbsp;Represents period-end regulatory capital expressed as a percentage of period-end total assets. Regulatory capital includes Class B capital stock (including MRCS) and retained earnings.

5&nbsp;&nbsp;&nbsp;&nbsp;Other income (loss) includes, among other things, net gains (losses) on investment securities, net gains (losses) on derivatives, net gains (losses) on financial instruments held under fair value option, and standby letter of credit fees.

6&nbsp;&nbsp;&nbsp;&nbsp;All other expense includes, among other things, compensation and benefits, professional fees, and contractual services.

7 &nbsp;&nbsp;&nbsp;&nbsp;Represents yield on total interest-earning assets minus cost of total interest-bearing liabilities.

8&nbsp;&nbsp;&nbsp;&nbsp;Represents net interest income expressed as a percentage of average interest-earning assets.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**RESULTS OF OPERATIONS**

**Net Interest Income**

Our net interest income is impacted by changes in average interest-earning asset and interest-bearing liability balances, and the related yields and costs. The following table presents average balances and yields/costs of major asset and liability categories (dollars in millions):&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2025 | 2025 | 2024 | 2024 | 2024 | 2023 | 2023 | 2023 |
| | Average<br>Balance<sup>1</sup> | Yield/Cost<sup>2</sup> | Interest<br>Income/<br>Expense<sup>3</sup> | Average<br>Balance<sup>1</sup> | Yield/Cost<sup>2</sup> | Interest<br>Income/<br>Expense<sup>3</sup> | Average<br>Balance<sup>1</sup> | Yield/Cost<sup>2</sup> | Interest<br>Income/<br>Expense<sup>3</sup> |
| Interest-earning assets |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest-bearing deposits | $4466 | 4.34% | $194 | $5189 | 5.21% | $270 | $4342 | 5.01% | $217 |
| &nbsp;&nbsp;&nbsp;Securities purchased under agreements to resell | 13178 | 4.29 | 565 | 10029 | 5.29 | 530 | 10589 | 5.12 | 542 |
| &nbsp;&nbsp;&nbsp;Federal funds sold | 12211 | 4.30 | 526 | 12875 | 5.21 | 671 | 14911 | 5.07 | 757 |
| &nbsp;&nbsp;&nbsp;MBS<sup>4,5,6</sup> | 26491 | 5.13 | 1360 | 23854 | 6.03 | 1438 | 18957 | 5.95 | 1128 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other investments<sup>4,5,6,7</sup> | 7223 | 3.86 | 278 | 5094 | 3.83 | 195 | 4322 | 3.70 | 160 |
| &nbsp;&nbsp;&nbsp;Advances<sup>5,8</sup> | 108091 | 4.70 | 5080 | 107422 | 5.60 | 6013 | 120027 | 5.44 | 6533 |
| &nbsp;&nbsp;&nbsp;Mortgage loans<sup>9</sup> | 13181 | 4.57 | 602 | 10893 | 4.14 | 452 | 9019 | 3.54 | 319 |
| &nbsp;&nbsp;&nbsp;Loans to other FHLBanks | 7 | 4.35 |  | 2 | 5.44 |  | 23 | 5.08 | 1 |
| Total interest-earning assets | 184848 | 4.65 | 8605 | 175358 | 5.46 | 9569 | 182190 | 5.30 | 9657 |
| Non-interest-earning assets | 2060 |  |  | 3623 |  |  | 3703 |  |  |
| Total assets | $186908 | 4.60% | $8605 | $178981 | 5.35% | $9569 | $185893 | 5.20% | $9657 |
| Interest-bearing liabilities |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | $1292 | 3.38% | $44 | $1244 | 4.34% | $54 | $1127 | 4.21% | $47 |
| &nbsp;&nbsp;&nbsp;Consolidated obligations |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discount notes<sup>5</sup> | 66953 | 4.22 | 2829 | 68202 | 5.07 | 3456 | 60662 | 4.80 | 2910 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bonds<sup>5</sup> | 105870 | 4.33 | 4578 | 95527 | 5.05 | 4821 | 109589 | 4.92 | 5392 |
| &nbsp;&nbsp;&nbsp;Other interest-bearing liabilities<sup>10</sup> | 44 | 7.87 | 4 | 28 | 6.93 | 2 | 23 | 6.98 | 2 |
| Total interest-bearing liabilities | 174159 | 4.28 | 7455 | 165001 | 5.05 | 8333 | 171401 | 4.87 | 8351 |
| Non-interest-bearing liabilities | 2637 |  |  | 4385 |  |  | 5159 |  |  |
| Total liabilities | 176796 | 4.22 | 7455 | 169386 | 4.92 | 8333 | 176560 | 4.73 | 8351 |
| Capital | 10112 |  |  | 9595 |  |  | 9333 |  |  |
| Total liabilities and capital | $186908 | 3.99% | $7455 | $178981 | 4.66% | $8333 | $185893 | 4.49% | $8351 |
| Net interest income and spread<sup>11</sup> |  | 0.37% | $1150 |  | 0.41% | $1236 |  | 0.43% | $1306 |
| Net interest margin<sup>12</sup> |  | 0.62% |  |  | 0.70% |  |  | 0.72% |  |
| Average interest-earning assets to interest-bearing liabilities |  | 106.14% |  |  | 106.28% |  |  | 106.29% |  |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Average balances are calculated on a daily weighted average basis and do not reflect the effect of derivative master netting arrangements with counterparties and/or clearing agents.

2&nbsp;&nbsp;&nbsp;&nbsp;In instances where the average balance and/or related income/expense is less than $1 million, the yield/cost will continue to be presented, based on numbers in actuals.

3&nbsp;&nbsp;&nbsp;&nbsp;Interest income and expense amounts reported for advances, MBS, other investments, and consolidated obligation bonds include gains (losses) on hedged items and derivatives in qualifying fair value hedge relationships.

4&nbsp;&nbsp;&nbsp;&nbsp;The average balance of AFS and HTM securities is reflected at amortized cost.

5&nbsp;&nbsp;&nbsp;&nbsp;Average balances reflect the impact of fair value hedging adjustments and/or fair value option adjustments.

6&nbsp;&nbsp;&nbsp;&nbsp;Interest income on investment securities includes prepayment fees, net of related amortization, of less than $1 million, $7 million, and $11 million for the years ended December 31, 2025, 2024, and 2023.

7&nbsp;&nbsp;&nbsp;&nbsp;Other investments primarily include U.S. Treasury obligations, other U.S. obligations, GSE and TVA obligations, state or local housing agency obligations, and taxable municipal bonds.

8&nbsp;&nbsp;&nbsp;&nbsp;Interest income includes net prepayment fees on advances.

9&nbsp;&nbsp;&nbsp;&nbsp;Non-accrual loans are included in the average balance used to determine the average yield.

10&nbsp;&nbsp;&nbsp;&nbsp;Other interest-bearing liabilities consists of MRCS and/or borrowings from other FHLBanks.

11&nbsp;&nbsp;&nbsp;&nbsp;Represents yield on total interest-earning assets minus cost of total interest-bearing liabilities. Amounts used to calculate net interest spread are based on numbers in actuals. Accordingly, recalculations using numbers in millions may not produce the same results.

12&nbsp;&nbsp;&nbsp;&nbsp;Represents net interest income expressed as a percentage of average interest-earning assets. Amounts used to calculate net interest margin are based on numbers in actuals. Accordingly, recalculations using numbers in millions may not produce the same results.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table presents changes in interest income and interest expense. Changes in interest income and interest expense that are not identifiable as either volume-related or rate-related, but rather attributable to both volume and rate changes, are allocated to the volume and rate categories based on the proportion of the absolute value of the volume and rate changes (dollars in millions).

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | 2025 vs. 2024 | 2025 vs. 2024 | 2025 vs. 2024 | 2024 vs. 2023 | 2024 vs. 2023 | 2024 vs. 2023 |
| | Total Increase <br>(Decrease) Due to | Total Increase <br>(Decrease) Due to | Total Increase<br>(Decrease) | Total Increase <br>(Decrease) Due to | Total Increase <br>(Decrease) Due to | Total Increase<br>(Decrease) |
| | Volume | Rate | Total Increase<br>(Decrease) | Volume | Rate | Total Increase<br>(Decrease) |
| Interest income |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest-bearing deposits | $(35) | $(41) | $(76) | $44 | $9 | 53 |
| &nbsp;&nbsp;&nbsp;Securities purchased under agreements to resell | 147 | (112) | 35 | (29) | 17 | (12) |
| &nbsp;&nbsp;&nbsp;Federal funds sold | (33) | (112) | (145) | (106) | 20 | (86) |
| &nbsp;&nbsp;&nbsp;MBS | 150 | (228) | (78) | 295 | 15 | 310 |
| &nbsp;&nbsp;&nbsp;Other investments | 82 | 1 | 83 | 29 | 6 | 35 |
| &nbsp;&nbsp;&nbsp;Advances | 37 | (970) | (933) | (706) | 186 | (520) |
| &nbsp;&nbsp;&nbsp;Mortgage loans | 100 | 50 | 150 | 73 | 60 | 133 |
| &nbsp;&nbsp;&nbsp;Loans to other FHLBanks |  |  |  | (1) |  | (1) |
| Total interest income | 448 | (1412) | (964) | (401) | 313 | (88) |
| Interest expense |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | 2 | (12) | (10) | 5 | 2 | 7 |
| &nbsp;&nbsp;&nbsp;Consolidated obligations |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discount notes | (62) | (565) | (627) | 376 | 170 | 546 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bonds | 489 | (732) | (243) | (710) | 139 | (571) |
| &nbsp;&nbsp;&nbsp;Other interest-bearing liabilities | 1 | 1 | 2 |  |  |  |
| Total interest expense | 430 | (1308) | (878) | (329) | 311 | (18) |
| Net interest income | $18 | $(104) | $(86) | $(72) | $2 | $(70) |

---

&nbsp;&nbsp;&nbsp;&nbsp;

NET INTEREST SPREAD AND MARGIN

Net interest spread represents the yield on total interest-earning assets minus the cost of total interest-bearing liabilities. Net interest margin equals net interest income expressed as a percentage of average interest-earning assets. Our net interest spread decreased during 2025, when compared to 2024 due to the yield on our interest-earning assets declining quicker than the cost of our interest-bearing liabilities, driven primarily by changes in interest rates and a decline in certain longer-term advances. The decline in net interest spread was offset in part by mortgage loan and MBS portfolio growth, as well as the call of higher-costing consolidated obligation bonds. Our net interest income does not include net interest settlements on economic hedges, which are recorded in other income (loss). As a result, our net interest spread does not reflect the full impact of our funding and hedging strategies and may experience volatility as interest rates change.

Net interest margin equals net interest income expressed as a percentage of average interest-earning assets. Our net interest margin decreased during 2025, when compared to 2024 due primarily to lower net interest spread and lower interest rates, which reduced our earnings on invested capital.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

ADVANCE PREPAYMENT FEES

The following table summarizes our advance prepayment fees (dollars in millions):

---

| | | | |
|:---|:---|:---|:---|
| | For the Years Ended | For the Years Ended | For the Years Ended |
| | December 31, | December 31, | December 31, |
| | 2025 | 2024 | 2023 |
| Prepayment fees on advances, gross<sup>1</sup> | $12 | $2 | $(4) |
| Basis adjustment amortization | (1) | 3 | 31 |
| Deferred prepayment fees on modified advances | (1) | (1) |  |
| Prepayment fees on advances, net | $10 | $4 | $27 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Includes symmetrical fees on advances for which we may charge the borrower a prepayment fee or pay the borrower a prepayment credit, depending on certain circumstances, such as movements in interest rates.

**Other Income (Loss)**

&nbsp;&nbsp;&nbsp;&nbsp;The following table summarizes the components of other income (loss) (dollars in millions):

---

| | | |
|:---|:---|:---|
| | For the Years Ended | For the Years Ended |
| | December 31, | December 31, |
| | 2025 | 2024 |
| Net gains (losses) on trading securities | $97 | $18 |
| Net gains (losses) on financial instruments held under fair value option | 12 | (31) |
| Net gains (losses) on derivatives | (51) | 8 |
| Other, net | 42 | 42 |
| Total other income (loss) | $100 | $37 |

---

&nbsp;&nbsp;&nbsp;&nbsp;

Other income (loss) increased $63 million during 2025 when compared to 2024, primarily due to the net change in fair value on our trading securities, fair value option instruments, and economic derivatives, including the related interest settlements. We utilize economic derivatives to hedge certain instruments held at fair value that do not qualify for fair value hedge accounting. These fair value elections are made primarily in an effort to mitigate the potential income statement volatility that can arise when an economic derivative is adjusted for changes in fair value, but the related hedged item is not. As a result, we review the related gains (losses) on these items on a net basis. During 2025, we recorded net combined gains of $58 million on our trading securities, fair value option instruments, and the related economic derivatives, compared to net combined losses of $5 million in 2024. The net increase was primarily driven by changes in interest rates. Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations — Hedging Activities](#i6940522039644a7690f9aab973fdec20_70)</u>" for additional discussion on our economic derivatives.

**Hedging Activities** 

We use derivatives to manage interest rate risk. Accounting rules affect the timing and recognition of income and expense on derivatives and therefore we may be subject to income statement volatility. If a hedging activity qualifies for hedge accounting treatment (fair value hedge), the net interest settlements of interest receivables or payables related to the derivative are recognized as interest income or expense in the relevant income statement line item consistent with the hedged asset or liability. The net fair value gains and losses of derivatives and hedged items designated in fair value hedge relationships are also recognized as interest income or expense. Amortization of basis adjustments from terminated hedges is also recorded in interest income or expense.

If a hedging activity does not qualify for hedge accounting treatment (economic hedge), the net interest settlements of interest receivables or payables related to the derivative as well as the fair value gains and losses on the derivative are recorded as a component of other income (loss) in "Net gains (losses) on derivatives;" however, there is no fair value adjustment for the corresponding asset or liability being hedged unless changes in the fair value of the asset or liability are normally marked to fair value through earnings (i.e., trading securities and fair value option instruments).

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table categorizes the net effect of hedging activities on net income by product (dollars in millions):

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | For the Year Ended December 31, 2025 | For the Year Ended December 31, 2025 | For the Year Ended December 31, 2025 | For the Year Ended December 31, 2025 | For the Year Ended December 31, 2025 | For the Year Ended December 31, 2025 | For the Year Ended December 31, 2025 |
| Net Effect of Hedging Activities | Advances | Investments | Mortgage<br>Loans | Discount Notes | Bonds | Other | Total |
| Net interest income: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Net amortization/accretion<sup>1</sup> | $21 | $4 | $1 | $— | $— | $— | $26 |
| &nbsp;&nbsp;Net gains (losses) on derivatives and hedged items | 1 | (15) |  | (1) | (5) |  | (20) |
| &nbsp;&nbsp;Price alignment amount on derivatives | (9) | (17) |  |  | (3) |  | (29) |
| &nbsp;&nbsp;Net interest settlements on derivatives<sup>2</sup> | 440 | 222 |  | (9) | (13) |  | 640 |
| Total impact to net interest income | 453 | 194 | 1 | (10) | (21) |  | 617 |
| Other income (loss): |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Net gains (losses) on derivatives |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Gains (losses) related to derivatives not designated as hedging instruments<sup>3</sup> |  | (29) |  | (23) |  |  | (52) |
| &nbsp;&nbsp;&nbsp;&nbsp;Price alignment amount on derivatives |  |  |  |  |  | 1 | 1 |
| &nbsp;&nbsp;Total net gains (losses) on derivatives |  | (29) |  | (23) |  | 1 | (51) |
| &nbsp;&nbsp;Net gains (losses) on trading securities<sup>4</sup> |  | 97 |  |  |  |  | 97 |
| &nbsp;&nbsp;Net gains (losses) on financial instruments held under fair value option<sup>4</sup> |  |  |  | 12 |  |  | 12 |
| Total impact to other income (loss) |  | 68 |  | (11) |  | 1 | 58 |
| Total net effect of hedging activities<sup>5</sup> | $453 | $262 | $1 | $(21) | $(21) | $1 | $675 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents the amortization/accretion of basis adjustments on closed hedge relationships.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents the interest component on derivatives that qualify for fair value hedge accounting.

3&nbsp;&nbsp;&nbsp;&nbsp;Represents net gains (losses) on economic derivatives and the related interest settlements.

4&nbsp;&nbsp;&nbsp;&nbsp;Represents the net gains (losses) on those trading securities and fair value option instruments for which we are utilizing economic derivatives to hedge the risk of changes in fair value.

5&nbsp;&nbsp;&nbsp;&nbsp;The hedging activity tables do not include the interest component on the related hedged items or the gross prepayment fee income on terminated advance or investment hedge relationships.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table categorizes the net effect of hedging activities on net income by product (dollars in millions):

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 |
| Net Effect of Hedging Activities | Advances | Investments | Mortgage<br>Loans | Discount Notes | Bonds | Other | Total |
| Net interest income: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Net amortization/accretion<sup>1</sup> | $39 | $13 | $1 | $— | $(8) | $— | $45 |
| &nbsp;&nbsp;&nbsp;Net gains (losses) on derivatives and hedged items | 1 | (14) |  |  | 19 |  | 6 |
| &nbsp;&nbsp;&nbsp;Price alignment amount on derivatives | (42) | (32) |  |  | (1) |  | (75) |
| &nbsp;&nbsp;Net interest settlements on derivatives<sup>2</sup> | 858 | 378 |  |  | (195) |  | 1041 |
| Total impact to net interest income | 856 | 345 | 1 |  | (185) |  | 1017 |
| Other income (loss): |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Net gains (losses) on derivatives |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Gains (losses) related to derivatives not designated as hedging instruments<sup>3</sup> |  | 71 | (1) | (64) |  |  | 6 |
| &nbsp;&nbsp;&nbsp;&nbsp;Price alignment amount on derivatives |  |  |  |  |  | 2 | 2 |
| &nbsp;&nbsp;Total net gains (losses) on derivatives |  | 71 | (1) | (64) |  | 2 | 8 |
| &nbsp;&nbsp;Net gains (losses) on trading securities<sup>4</sup> |  | 18 |  |  |  |  | 18 |
| &nbsp;&nbsp;Net gains (losses) on financial instruments held under fair value option<sup>4</sup> |  |  |  | (31) |  |  | (31) |
| Total impact to other income (loss) |  | 89 | (1) | (95) |  | 2 | (5) |
| Total net effect of hedging activities<sup>5</sup> | $856 | $434 | $— | $(95) | $(185) | $2 | $1012 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents the amortization/accretion of basis adjustments on closed hedge relationships.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents the interest component on derivatives that qualify for fair value hedge accounting.

3&nbsp;&nbsp;&nbsp;&nbsp;Represents net gains (losses) on economic derivatives and the related interest settlements.

4&nbsp;&nbsp;&nbsp;&nbsp;Represents the net gains (losses) on those trading securities and fair value option instruments for which we are utilizing economic derivatives to hedge the risk of changes in fair value.

5&nbsp;&nbsp;&nbsp;&nbsp;The hedging activity tables do not include the interest component on the related hedged items or the gross prepayment fee income on terminated advance or investment hedge relationships.

NET AMORTIZATION/ACCRETION

Net amortization/accretion varies from period to period depending on our hedge relationship termination activities and the maturity, call, or prepayment of assets or liabilities previously in hedge relationships.

NET GAINS (LOSSES) ON DERIVATIVES AND HEDGED ITEMS

Net gains and losses on derivatives and hedged items designated in fair value hedge relationships are recorded in net interest income. Gains (losses) on derivatives and hedged items fluctuate with changes in market conditions and are based on a range of factors, including current and projected levels of interest rates and volatility.

PRICE ALIGNMENT AMOUNT ON DERIVATIVES

The price alignment amount on derivatives for which variation margin is characterized as a daily settled contract fluctuates with changes in the interest rate environment. The price alignment amount on derivatives that qualify for fair value hedge accounting is recorded in net interest income. The price alignment amount on economic derivatives is recorded in other income (loss) as "Net gains (losses) on derivatives" on our Statements of Income.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

NET INTEREST SETTLEMENTS ON DERIVATIVES

Net interest settlements represent the interest component on derivatives that qualify for fair value hedge accounting. These amounts vary from period to period depending on our hedging activities and interest rates and are partially offset by the interest component on the related hedged item within net interest income. The hedging activity tables do not include the impact of the interest component on the related hedged item.

NET GAINS (LOSSES) ON DERIVATIVES

We utilize economic derivatives to manage certain risks on our Statements of Condition. Gains and losses on economic derivatives include interest settlements and price alignment amounts. Interest settlements represent the interest component on economic derivatives. These amounts vary from period to period depending on our hedging activities and interest rates.

**Other Expense**

The following table shows the components of other expense (dollars in millions):

---

| | | |
|:---|:---|:---|
| | For the Years Ended | For the Years Ended |
| | December 31, | December 31, |
| | 2025 | 2024 |
| Compensation and benefits | $82 | $78 |
| Contractual services | 27 | 26 |
| Professional fees | 14 | 19 |
| Other operating expenses | 24 | 21 |
| Total operating expenses | 147 | 144 |
| Voluntary community and housing contributions | 78 | 68 |
| Federal Housing Finance Agency | 14 | 14 |
| Office of Finance | 10 | 10 |
| Other, net | 21 | 22 |
| Total other expense | $270 | $258 |

---

Other expense increased $12 million during 2025 when compared to 2024, primarily due to an increase in voluntary community and housing contributions and compensation and benefits. This increase was offset in part by a decline in professional fees, driven primarily by lower contract labor costs.

**Supporting Housing and Community Investment**

In addition to providing a readily available, competitively-priced source of funds to members, one of our core missions is to support affordable housing and community investment. To help fulfill that mission, we administer a number of programs, some of which are statutory while others are voluntary. These include grants through AHP to support low-to-moderate income households, as well as Community Investment Advances, which are discounted advances to support economical development and housing in the communities our members serve. In addition, we offer voluntary programs that provide grants and/or discounted advances to further support our mission.

We recognize statutory AHP assessment expense equal to 10 percent of our annual income subject to assessment (GAAP net income before interest expense related to MRCS and the assessment for AHP) and these funds are required to be granted in the subsequent year. AHP grants include performance-based criteria, which can result in the awards being disbursed over a period of several years or recaptured if performance under the award is not achieved. Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 10 — Affordable Housing Program](#i6940522039644a7690f9aab973fdec20_217)</u>" for additional information about the statutory AHP expenses and related liability.

In addition to statutory AHP assessments, the FHLBanks are committed to making voluntary contributions representing five percent or more of their earnings in support of affordable housing and community investment initiatives, collectively referred to as voluntary contributions.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table provides the calculation of our voluntary contribution targets (dollars in millions):

---

| | | |
|:---|:---|:---|
| | For the Years Ended | For the Years Ended |
| | December 31, | December 31, |
| | 2025 | 2024 |
| Prior year net income before assessment | $1016 | $1069 |
| Adjustment: |  |  |
| &nbsp;&nbsp;Prior year interest expense on MRCS | 1 | 1 |
| Prior year net income subject to assessment | $1017 | $1070 |
| Unadjusted voluntary contribution commitment (5%) | $51 | $54 |
| Adjustment: |  |  |
| &nbsp;&nbsp;Adjustment for prior year voluntary contributions<sup>1</sup> | 3 | 2 |
| Voluntary contribution commitment target | $54 | $56 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;The income statement effects of our voluntary contributions reduce net income before assessments which, in turn, reduces the voluntary contributions in the subsequent year. In order to restore our voluntary contributions to the dollar amount it would be in the absence of these effects, we voluntarily contributed an additional amount to our voluntary affordable housing and community investment initiatives.

We provided voluntary initiatives that support affordable housing and community investments, which are recorded within "Other expense" on our Statements of Income. The following table provides the components of how we fulfilled our voluntary contribution commitment (dollars in millions):

---

| | | |
|:---|:---|:---|
| | For the Years Ended | For the Years Ended |
| | December 31, | December 31, |
| | 2025 | 2024 |
| Voluntary contributions |  |  |
| &nbsp;&nbsp;Affordable housing | $35 | $51 |
| &nbsp;&nbsp;Voluntary AHP<sup>1</sup> | 7 | 6 |
| &nbsp;&nbsp;Community investment | 26 | 4 |
| &nbsp;&nbsp;Disaster relief and climate resiliency | 2 |  |
| Voluntary contribution fulfillment | $70 | $61 |
| Fulfillment, as a percent of prior year net income subject to assessment, as adjusted | 6.5% | 5.5% |

---

1 &nbsp;&nbsp;&nbsp;&nbsp;Excludes $8 million and $7 million of supplemental voluntary contributions to AHP for the years ended December 31, 2025 and 2024. The income statement effects of the voluntary programs reduce net income before assessments which, in turn, reduces the statutory AHP assessment each year. We have committed to make supplemental voluntary contributions to AHP by an amount that equals what the statutory AHP assessment would be in the absence of these effects.

Based on the amount of net income subject to assessment in 2025, our five percent voluntary contribution commitment target for 2026 will be $53 million (excluding supplemental voluntary AHP contributions). In 2026, we also expect to award 2025 statutory AHP assessments of $98 million.

**Affordable Housing Program Assessments**

Annually, we must set aside for the AHP the greater of 10 percent of our annual income subject to assessment, or our prorated portion of the sum required to ensure the aggregate contribution by the FHLBanks is no less than $100 million for each year. For purposes of the required AHP assessment, income subject to assessments is defined as net income before assessments, plus interest expense related to mandatorily redeemable capital stock. The exclusion of interest expense related to mandatorily redeemable capital stock is a regulatory interpretation of the Finance Agency.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table provides a calculation of the net income subject to assessment, adjusted for voluntary contribution fulfillment, to show how our supplemental voluntary AHP contribution restores the AHP amounts to 10 percent of earnings absent the five percent voluntary commitment fulfillment (dollars in millions):

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| | | |
|:---|:---|:---|
| | For the Years Ended | For the Years Ended |
| | December 31, | December 31, |
| | 2025 | 2024 |
| Net income subject to statutory assessment | $979 | $1016 |
| Adjustment: |  |  |
| &nbsp;&nbsp;Voluntary commitment fulfillment, recognized in net income<sup>1</sup> | 70 | 61 |
| &nbsp;&nbsp;Supplemental AHP contributions for the current year<sup>2</sup> | 8 | 7 |
| Net income subject to assessment, as adjusted | $1057 | $1084 |
| 10% of net income subject to assessment, as adjusted<sup>3</sup> | $106 | $109 |
| Statutory AHP assessments | $98 | 102 |
| Supplemental voluntary AHP contributions for the current year<sup>2</sup> | 8 | 7 |
| Total statutory AHP assessment and supplemental voluntary AHP contributions for the current year | $106 | $109 |

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1&nbsp;&nbsp;&nbsp;&nbsp;Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations — Supporting Housing and Community Investment](#i6940522039644a7690f9aab973fdec20_76)</u>" for the composition of this amount.

2&nbsp;&nbsp;&nbsp;&nbsp;Included in "Voluntary community and housing contributions" expense on the Statements of Income.

3&nbsp;&nbsp;&nbsp;&nbsp;Represents the calculated amount of earnings that would be available for AHP assessment if we had not made voluntary contributions to other initiatives, which reduce net income before assessment which, in turn, reduces the statutory AHP assessment.

The AHP helps members to provide grants or subsidized advances to support the acquisition, development, or rehabilitation of affordable rental or owner-occupied housing. All operating and administrative costs for the AHP are included in our operating expenses, so all AHP contributions go directly to support affordable housing projects and eligible households. For the years ended December 31, 2025 and 2024, AHP contributions were used to award $107 million and $103 million in grants that funded 58 projects and 59 projects that provided approximately 1,927 and 2,100 units of affordable housing. In addition, during the years ended December 31, 2025 and 2024, a portion of AHP was allocated to our down payment products, which support homeownership for households with incomes at or below 80 percent of the area median, adjusted for family size. During the years ended December 31, 2025 and 2024, $15 million and $11 million of grants were disbursed to 944 and 800 eligible households, the majority of whom were first-time homebuyers.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**STATEMENTS OF CONDITION**

**Advances** 

The following table summarizes our advances by type of institution (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Commercial banks | $47532 | $43653 |
| Savings institutions | 1008 | 1770 |
| Credit unions | 10266 | 12941 |
| Insurance companies | 50861 | 42235 |
| CDFIs | 14 | 8 |
| Total member advances | 109681 | 100607 |
| Housing associates |  | 108 |
| Non-member borrowers | 497 | 15 |
| Total par value | $110178 | $100730 |

---

Our total advance par value increased $9.4 billion, or nine percent, at December 31, 2025, when compared to December 31, 2024. The increase was primarily due to an increase in borrowings by large depository institution members and insurance companies.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

INTEREST RATE PAYMENT AND REDEMPTION TERMS

The following table summarizes advances by interest rate payment and redemption terms (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| | Amount | % of Total | Amount | % of Total |
| Fixed rate |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Due in one year or less | $33370 | 30 | $39832 | 40 |
| &nbsp;&nbsp;&nbsp;Due after one year through three years | 23042 | 21 | 20417 | 20 |
| &nbsp;&nbsp;&nbsp;Due after three years through five years | 12483 | 12 | 13869 | 14 |
| &nbsp;&nbsp;Due after five years through 15 years | 4550 | 4 | 4096 | 4 |
| &nbsp;&nbsp;Thereafter | 12 |  | 14 |  |
| Total par value | 73457 | 67 | 78228 | 78 |
| Variable rate |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Due in one year or less | 19527 | 18 | 4566 | 4 |
| &nbsp;&nbsp;&nbsp;Due after one year through three years | 3330 | 3 | 3970 | 4 |
| &nbsp;&nbsp;Due after three years through five years | 1675 | 1 | 1916 | 2 |
| &nbsp;&nbsp;Due after five years through 15 years | 750 | 1 | 750 | 1 |
| Total par value | 25282 | 23 | 11202 | 11 |
| Variable rate, callable<sup>1</sup> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Due in one year or less | 743 | 1 | 1149 | 1 |
| &nbsp;&nbsp;&nbsp;Due after one year through three years | 3620 | 3 | 4083 | 4 |
| &nbsp;&nbsp;Due after three years through five years | 6019 | 5 | 4911 | 5 |
| Total par value | 10382 | 9 | 10143 | 10 |
| Other<sup>2</sup> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Due in one year or less | 255 |  | 192 |  |
| &nbsp;&nbsp;&nbsp;Due after one year through three years | 352 | 1 | 387 |  |
| &nbsp;&nbsp;Due after three years through five years | 347 |  | 418 | 1 |
| &nbsp;&nbsp;Due after five years through 15 years | 100 |  | 155 |  |
| &nbsp;&nbsp;Thereafter | 3 |  | 4 |  |
| Total par value | 1057 | 1 | 1156 | 1 |
| Overdrawn demand deposit accounts |  |  | 1 |  |
| Total advance par value | 110178 | 100 | 100730 | 100 |
| Premiums | 2 |  | 3 |  |
| Discounts | (22) |  | (21) |  |
| Fair value hedging adjustments | 72 |  | (761) |  |
| Total | $110230 |  | $99951 |  |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Callable advances are those advances that may be contractually prepaid by the borrower on predetermined dates without incurring prepayment or termination fees.

2&nbsp;&nbsp;&nbsp;&nbsp;Includes fixed-rate amortizing and fixed-rate callable advances.

During the year ended December 31, 2025, the composition of our advance portfolio shifted to a higher concentration of variable rate advances due in part to increased usage of short-term non-callable variable rate advances and the maturity of short-term fixed rate advances. Fair value hedging adjustments changed $833 million at December 31, 2025 when compared to December 31, 2024, due primarily to the interest rate environment.

&nbsp;&nbsp;&nbsp;&nbsp;

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

At December 31, 2025 and 2024, advances outstanding to our five largest member borrowers totaled $51.6 billion and $31.3 billion, representing 47 percent and 31 percent of our total advances outstanding. The following table summarizes advances outstanding to our five largest member borrowers at December 31, 2025 (dollars in millions):

---

| | | |
|:---|:---|:---|
| | Amount | % of Total Advances |
| Athene Annuity and Life Company | $23271 | 21 |
| Wells Fargo Bank, N.A. | 16000 | 15 |
| EquiTrust Life Insurance Company | 4250 | 4 |
| UBS Bank USA | 4101 | 4 |
| Symetra Life Insurance Company | 3986 | 3 |
| Total par value | $51608 | 47 |

---

We evaluate advances for credit losses on a quarterly basis and have never experienced a credit loss on our advances. For additional discussion on our advance credit risk, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Credit Risk — Advances](#ia9c5fd5e2848466f9a0482fdb160304d_29192)</u>."

**Mortgage Loans** 

&nbsp;&nbsp;&nbsp;&nbsp;The following table summarizes information on our mortgage loans held for portfolio (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Fixed rate conventional loans | $14097 | $11452 |
| Fixed rate government-insured loans | 356 | 365 |
| Total unpaid principal balance | 14453 | 11817 |
| Premiums | 156 | 130 |
| Discounts | (54) | (33) |
| Basis adjustments from mortgage loan purchase commitments | (9) | (13) |
| Total mortgage loans held for portfolio | 14546 | 11901 |
| Allowance for credit losses | (6) | (5) |
| Total mortgage loans held for portfolio, net | $14540 | $11896 |

---

Our total mortgage loans increased $2.6 billion, or 22 percent, at December 31, 2025, when compared to December 31, 2024. The increase was primarily due to new loan purchases exceeding principal paydowns, driven in part by low prepayment activity as mortgage rates remain elevated.

REDEMPTION TERMS

The following table summarizes our fixed rate mortgage loans held for portfolio by redemption terms (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| Redemption Term | 2025 | 2024 |
| Due in one year or less | $412 | $364 |
| Due after one year through five years | 1748 | 1525 |
| Due after five years through fifteen years | 4799 | 4021 |
| Thereafter | 7494 | 5907 |
| Total unpaid principal balance | $14453 | $11817 |

---

We evaluate mortgage loans for credit losses on a quarterly basis. For additional discussion on our mortgage loan credit risk, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Credit Risk — Mortgage Loans](#ia9c5fd5e2848466f9a0482fdb160304d_29193)</u>."

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Investments**

The following table summarizes the carrying value of our investments (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| | Amount | % of Total | Amount | % of Total |
| Short-term investments<sup>1</sup> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest-bearing deposits | $3726 | 6 | $4096 | 8 |
| &nbsp;&nbsp;&nbsp;Securities purchased under agreements to resell | 17090 | 28 | 11950 | 23 |
| &nbsp;&nbsp;&nbsp;Federal funds sold | 5930 | 10 | 5175 | 10 |
| Total short-term investments | 26746 | 44 | 21221 | 41 |
| Long-term investments<sup>2</sup> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSE single-family | 516 | 1 | 564 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSE multifamily | 20882 | 34 | 18984 | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. obligations single-family<sup>3</sup> | 5708 | 9 | 5202 | 10 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Private-label residential | 2 |  | 2 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total MBS | 27108 | 44 | 24752 | 47 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-MBS |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. Treasury obligations<sup>3</sup> | 6104 | 10 | 4508 | 9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other U.S. obligations<sup>3</sup> | 71 |  | 161 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations | 482 | 1 | 714 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State or local housing agency obligations | 391 | 1 | 528 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other<sup>4</sup> | 113 |  | 148 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total non-MBS | 7161 | 12 | 6059 | 12 |
| Total long-term investments | 34269 | 56 | 30811 | 59 |
| Total investments | $61015 | 100 | $52032 | 100 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Short-term investments have original maturities equal to or less than one year.

2&nbsp;&nbsp;&nbsp;&nbsp;Long-term investments have original maturities of greater than one year.

3&nbsp;&nbsp;&nbsp;&nbsp;Represents investment securities backed by the full faith and credit of the U.S. Government.

4&nbsp;&nbsp;&nbsp;&nbsp;Consists of taxable municipal bonds.

Our investments increased $9.0 billion, or 17 percent, at December 31, 2025, when compared to December 31, 2024, due in part to an increase in securities purchased under agreements to resell, as well as the purchase of agency MBS and U.S. Treasury obligations. At December 31, 2025, we had no investment purchases that were traded but not yet settled. At December 31, 2024, we had agency MBS purchases with a total par value of $162 million that were traded but not yet settled. These investments were recorded as "Available-for-sale" on our Statements of Condition with a corresponding payable recorded in "Other liabilities."

The Finance Agency limits our investments in MBS by requiring that the balance of our MBS not exceed three times regulatory capital at the time of purchase. At December 31, 2025, our ratio of MBS to regulatory capital was 2.64 compared to 2.71 at December 31, 2024.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

REDEMPTION TERMS AND YIELDS

The following table summarizes the carrying value and yield characteristics of our AFS and HTM investment portfolios on the basis of remaining terms to contractual maturity. Expected maturities of some securities may differ from contractual maturities, as borrowers may have the right to call or prepay obligations with or without call or prepayment fees (dollars in millions):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, | December 31, | December 31, | December 31, | December 31, | December 31, |
| | 2025 | 2025 | 2025 | 2025 | 2025 | 2024 |
| | Due in one year or less | Due after one year through five years | Due after five years through 10 years | Due after 10 years | Carrying Value | Carrying Value |
| AFS securities |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Non-MBS |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other U.S. obligations<sup>1</sup> | $11 | $3 | $— | $— | $14 | $102 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations |  | 27 | 11 | 272 | 310 | 309 |
| &nbsp;&nbsp;&nbsp;&nbsp;State or local housing agency obligations |  |  | 216 | 154 | 370 | 499 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other<sup>2</sup> |  | 19 |  |  | 19 | 42 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-MBS | 11 | 49 | 227 | 426 | 713 | 952 |
| &nbsp;&nbsp;&nbsp;MBS |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S. obligations <br>single-family<sup>1</sup> |  |  |  | 5707 | 5707 | 5200 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE single-family |  |  | 6 | 211 | 217 | 195 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE multifamily | 250 | 4331 | 16018 | 283 | 20882 | 18984 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total MBS | 250 | 4331 | 16024 | 6201 | 26806 | 24379 |
| Total AFS securities | 261 | 4380 | 16251 | 6627 | 27519 | 25331 |
| HTM securities |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Non-MBS |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations |  | 25 | 64 | 35 | 124 | 358 |
| &nbsp;&nbsp;&nbsp;&nbsp;State or local housing agency obligations | 3 | 2 | 5 | 11 | 21 | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-MBS | 3 | 27 | 69 | 46 | 145 | 387 |
| &nbsp;&nbsp;&nbsp;MBS |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S. obligations <br>single-family<sup>1</sup> |  |  |  | 1 | 1 | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE single-family |  | 7 | 40 | 252 | 299 | 369 |
| &nbsp;&nbsp;&nbsp;&nbsp;Private-label |  |  | 2 |  | 2 | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total MBS |  | 7 | 42 | 253 | 302 | 373 |
| Total HTM securities | $3 | $34 | $111 | $299 | $447 | $760 |
| Weighted-average yields on: |  |  |  |  |  |  |
| &nbsp;&nbsp;AFS securities<sup>3</sup> | 3.96% | 3.78% | 4.30% | 4.79% |  |  |
| &nbsp;&nbsp;HTM securities<sup>3</sup> | 4.86% | 3.63% | 4.88% | 4.51% |  |  |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents investment securities backed by the full faith and credit of the U.S. Government.

2&nbsp;&nbsp;&nbsp;&nbsp;Consists of taxable municipal bonds.

3&nbsp;&nbsp;&nbsp;&nbsp;The weighted average yields on AFS and HTM securities are calculated as the sum of each debt security using the period end balances multiplied by the coupon rate, divided by the total debt securities in the applicable HTM or AFS portfolio. The result is then multiplied by 100 to express it as a percentage.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

INTEREST RATE PAYMENT TERMS

The following table summarizes the interest rate payment terms of investment securities (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Trading securities at fair value |  |  |
| &nbsp;&nbsp;&nbsp;Fixed rate | $6303 | $4720 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total trading securities | $6303 | $4720 |
| AFS securities at amortized cost |  |  |
| &nbsp;&nbsp;&nbsp;Fixed rate | $20840 | $18474 |
| &nbsp;&nbsp;&nbsp;Variable rate | 6496 | 6884 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total AFS securities | $27336 | $25358 |
| HTM securities at amortized cost |  |  |
| &nbsp;&nbsp;&nbsp;Fixed rate | $183 | $431 |
| &nbsp;&nbsp;&nbsp;Variable rate | 264 | 329 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total HTM securities | $447 | $760 |

---

We evaluate investments for credit losses on a quarterly basis. For additional discussion on our investment credit risk, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Credit Risk — Investments](#ia9c5fd5e2848466f9a0482fdb160304d_29194)</u>."

**Consolidated Obligations** 

&nbsp;&nbsp;&nbsp;&nbsp;Consolidated obligations, which include bonds and discount notes, are the primary source of funds to support our advances, mortgage loans, and investments. At December 31, 2025 and 2024, the carrying value of consolidated obligations for which we are primarily liable totaled $173.9 billion and $153.3 billion.

DISCOUNT NOTES

The following table summarizes our discount notes, all of which are due within one year (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Par value | $85186 | $65250 |
| Discounts and concession fees<sup>1</sup> | (586) | (586) |
| Fair value hedging adjustments | 17 |  |
| Fair value option adjustments | 3 | 16 |
| Total | $84620 | $64680 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Concessions represent fees paid to dealers in connection with the issuance of certain consolidated obligation discount notes.

Our discount notes increased $19.9 billion, or 31 percent, at December 31, 2025, when compared to December 31, 2024. During the year ended December 31, 2025, we continued to utilize discount notes in an effort to capture attractive funding and/or meet our liquidity requirements and began electing fair value hedge accounting for certain discount notes. Fair value option adjustments changed $13 million at December 31, 2025, when compared to December 31, 2024, driven primarily by the reversal of historic gains and losses on instruments as they approach maturity and the impact of new trades, offset in part by changes in the interest rate environment.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

BONDS

The following table summarizes information on our bonds (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Par value | $89188 | $88588 |
| Premiums | 28 | 30 |
| Discounts and concession fees<sup>1</sup> | (23) | (25) |
| Fair value hedging adjustments | 56 | (22) |
| Total | $89249 | $88571 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Concessions represent fees paid to dealers in connection with the issuance of certain consolidated obligation bonds.

Our bonds remained relatively stable at December 31, 2025, when compared to December 31, 2024. Fair value hedging adjustments changed $78 million at December 31, 2025, when compared to December 31, 2024, driven primarily by the interest rate environment.

INTEREST RATE PAYMENT TERMS

Bonds are issued with either a fixed or variable rate, such as SOFR. The following table summarizes our bonds by interest rate payment terms (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Fixed rate | $34962 | $34935 |
| Simple variable rate | 54226 | 53653 |
| Total par value | $89188 | $88588 |

---

For additional information on our consolidated obligations, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Liquidity — Sources of Liquidity](#i57dfd06e31f94e2095e69a37b026d652_15615)</u>."

**Deposits**

Deposits represent a small portion of our funding, totaling $1.1 billion at December 31, 2025, a decrease of $167 million, or 13 percent, from December 31, 2024. All of our deposits are uninsured and the balance of deposits varies depending on market factors, such as the attractiveness of our deposit pricing relative to rates available on alternative money market instruments, our members' investment preferences and the availability of alternative short-term investments, and our members' liquidity levels.

Interest-bearing demand and overnight deposits pay interest based on a daily interest rate. The average balances of demand and overnight deposits were $1.1 billion, $1.0 billion, and $1.0 billion, and the weighted-average interest rates paid on demand and overnight deposits were 3.21 percent, 4.15 percent, and 4.07 percent during the years ended December 31, 2025, 2024, and 2023.

The following table summarizes our uninsured term deposits (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Three months or less | $6 | $6 |
| Over three months through six months |  | 1 |
| Over six months through 12 months | 4 | 2 |
| Total | $10 | $9 |

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Capital**

The following table summarizes information on our capital (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Capital stock | $6509 | $5989 |
| Retained earnings | 3797 | 3491 |
| Accumulated other comprehensive income (loss) | 181 | (29) |
| Total capital | $10487 | $9451 |

---

Our capital increased $1.0 billion, or 11 percent, at December 31, 2025, when compared to December 31, 2024. The increase was primarily due to an increase in activity-based capital stock resulting from an increase in advance balances and an increase in retained earnings. Refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Capital](#i57dfd06e31f94e2095e69a37b026d652_15617)</u>" for additional information on our capital.

**Derivatives** 

&nbsp;&nbsp;&nbsp;&nbsp;We use derivatives to manage interest rate risk. The notional amount of derivatives serves as a factor in determining periodic interest payments and cash flows received and paid. However, the notional amount of derivatives represents neither the actual amounts exchanged nor our overall exposure to credit and market risk.

The following table categorizes the notional amount of our derivatives by type (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Interest rate swaps |  |  |
| &nbsp;&nbsp;&nbsp;Noncallable | $171040 | $146567 |
| &nbsp;&nbsp;&nbsp;Callable by counterparty | 14872 | 8335 |
| &nbsp;&nbsp;&nbsp;Callable by the Bank | 33 |  |
| Total interest rate swaps | 185945 | 154902 |
| Forward settlement agreements | 111 | 91 |
| Mortgage loan purchase commitments | 106 | 101 |
| Total notional amount | $186162 | $155094 |

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&nbsp;&nbsp;&nbsp;&nbsp;

The notional amount of our derivative contracts increased $31.1 billion, or 20 percent, at December 31, 2025, when compared to December 31, 2024. The increase was primarily due to the utilization of interest rate swaps to hedge the growth in our consolidated obligations. During 2025, we increased our utilization of non-callable swaps on discount notes, and callable swaps on consolidated obligation bonds in an effort to capture attractive funding and/or meet our liquidity requirements. For additional discussion regarding our use of derivatives, see "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Interest Rate Risk — Derivatives](#ia9c5fd5e2848466f9a0482fdb160304d_29200)</u>."

**LIQUIDITY AND CAPITAL RESOURCES**

Our liquidity and capital positions are actively managed in an effort to preserve stable, reliable, and cost-effective sources of funds to meet current and projected operating financial commitments, as well as regulatory, liquidity, and capital requirements.

**Liquidity**

SOURCES OF LIQUIDITY

We utilize several sources of liquidity to carry out our business activities. These include, but are not limited to, proceeds from the issuance of consolidated obligations, payments collected on advances and mortgage loans, proceeds from investment securities, member deposits, the issuance of capital stock, and current period earnings.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

Our primary source of liquidity is proceeds from the issuance of consolidated obligations (bonds and discount notes) in the capital markets. During 2025, proceeds from the issuance of bonds and discount notes were $122.9 billion and $1,476.1 billion compared to $55.9 billion and $1,688.5 billion in 2024. During 2025, although we increased our utilization of consolidated obligation bonds, we continued to issue discount notes in an effort to capture attractive funding and/or meet our liquidity requirements.

Access to debt markets has been reliable because investors, driven by increased liquidity preference and our GSE status, have sought the FHLBanks' debt as an asset of choice. However, due to the short-term maturity of the debt, we may be exposed to additional risks associated with refinancing and our ability to access the capital markets.

We are focused on maintaining an adequate liquidity balance and a funding balance between our financial assets and financial liabilities and work collectively with the other FHLBanks to manage the system-wide liquidity and funding needs. We monitor our debt refinancing risk and liquidity position primarily by tracking the maturities of financial assets and financial liabilities. In managing and monitoring the amounts of assets that require refunding, we consider contractual maturities of our financial assets and liabilities, as well as certain assumptions regarding expected cash flows (e.g., estimated prepayments). External factors, including member borrowing needs, supply and demand in the debt markets, and other factors may affect liquidity balances and the funding balances between financial assets and financial liabilities. Refer to "<u>[Item 8. Financial Statements and Supplementary Data](#i6940522039644a7690f9aab973fdec20_136)</u>" for additional information regarding the contractual maturities or redemption terms of certain of our financial assets and liabilities.

Our ability to raise funds in the capital markets as well as our cost of borrowing may be affected by our credit ratings. For our current credit ratings and further discussion of how credit rating changes and our ability to access the capital markets may impact us in the future, refer to "<u>[Ite](#i6940522039644a7690f9aab973fdec20_16)[m 1. Business](#i6940522039644a7690f9aab973fdec20_16)</u>" and "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>."

Although we are primarily liable for the portion of consolidated obligations that are issued on our behalf, we are also jointly and severally liable with the other FHLBanks for the payment of principal and interest on all consolidated obligations issued by the FHLBank System. At December 31, 2025 and 2024, the total par value of outstanding consolidated obligations for which we are primarily liable was $174.4 billion and $153.8 billion. At December 31, 2025 and 2024, the total par value of outstanding consolidated obligations issued on behalf of other FHLBanks for which we are jointly and severally liable was $977.4 billion and $1,039.2 billion.

The Office of Finance and FHLBanks have contingency plans in place that prioritize the allocation of proceeds from the issuance of consolidated obligations during periods of financial distress if consolidated obligations cannot be issued in sufficient amounts to satisfy all FHLBank demand. In the event of significant market disruptions or local disasters, our President and CEO or designee is authorized to establish interim borrowing relationships with other FHLBanks. To provide further access to funding, the FHLBank Act also authorizes the U.S. Treasury to directly purchase new issue consolidated obligations of the GSEs, including FHLBanks, up to an aggregate principal amount of $4.0 billion. As of February 28, 2026, no purchases had been made by the U.S. Treasury under this authorization.

USES OF LIQUIDITY

&nbsp;&nbsp;&nbsp;&nbsp;We use our available liquidity, including proceeds from the issuance of consolidated obligations, primarily to repay consolidated obligations, fund advances, and purchase investments. During 2025, repayments of consolidated obligations totaled $1,578.0 billion compared to $1,763.1 billion in 2024.

During 2025, advance disbursements (excluding daily renewals) totaled $695.4 billion compared to $406.0 billion in 2024. Advance disbursements will vary from period to period depending on member needs. In addition, during the second quarter of 2024, we began offering an overnight advance with a one day maturity. The increase during 2025 was due primarily to member utilization of short-term advances, including overnight advances. During 2025, investment purchases (excluding overnight investments) totaled $5.7 billion compared to $7.9 billion in 2024, a decrease due primarily to fewer purchases of securities purchased under agreements to resell and agency MBS.

We also use liquidity to purchase mortgage loans, redeem member deposits, pledge collateral to derivative counterparties, redeem or repurchase capital stock, pay expenses, and pay dividends.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

LIQUIDITY REQUIREMENTS

We are subject to certain liquidity requirements set forth by the Finance Agency, as further outlined below. We also maintain a liquidity contingency funding plan designed to enable us to meet our obligations and the liquidity needs of our members in the event of short-term capital market disruptions, or operational disruptions at our Bank and/or the Office of Finance.

*Liquidity Guidance AB* – This guidance requires us to maintain sufficient liquidity for a period of 10 to 30 calendar days. The base case scenario requires 20 days of positive daily cash balances and assumes that we cannot access the capital markets to issue debt, and during that time we will automatically renew maturing and called advances for all members, including large highly-rated members, and we hold additional liquid assets equal to one percent of our letters of credit balances. At December 31, 2025 and 2024, we were in compliance with this base case liquidity guidance.

The Liquidity Guidance AB also specifies appropriate funding gap limits to address the risks associated with an FHLBank having too large a mismatch between the contractual maturities of its assets and liabilities. A funding gap measures the difference between assets and liabilities that are scheduled to mature during a specified period and is expressed as a percentage of total assets. The guidance provides recommended maximum funding gap limits of negative 15 percent at the three-month horizon and negative 30 percent at the one-year horizon. At December 31, 2025 and 2024, we adhered to these funding gap requirements.

*Liquidity Reserves for Deposits* – We are required to have advances with maturities not to exceed five years, deposits in banks or trust companies, or obligations of the U.S. Treasury in an aggregate amount greater than or equal to members' current deposits available at all times. At December 31, 2025 and 2024, we were in compliance with this liquidity guidance.

*Unpledged Qualifying Assets* – We are required to maintain, in the aggregate, unpledged qualifying assets in an amount at least equal to the amount of our participation in total consolidated obligations outstanding. The following table shows our compliance with this requirement (dollars in billions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Qualifying assets free of lien or pledge | $184.9 | $163.8 |
| Consolidated obligations outstanding | 173.9 | 153.3 |
| Excess liquidity | $11.0 | $10.5 |

---

**Capital**

CAPITAL REQUIREMENTS

&nbsp;&nbsp;&nbsp;&nbsp;We are subject to certain regulatory capital requirements. Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 11 — Capital](#i6940522039644a7690f9aab973fdec20_220)</u>" for additional information on our regulatory capital requirements.&nbsp;&nbsp;&nbsp;&nbsp;

CAPITAL STOCK

Our capital stock has a par value of $100 per share, and all shares are issued, redeemed, and repurchased only at the stated par value. We issue a single class of capital stock (Class B capital stock) and have two subclasses of Class B capital stock: membership and activity-based. All Class B capital stock issued is subject to a notice of redemption period of five years.

The capital stock requirements established in our Capital Plan are designed so that we can remain adequately capitalized as member activity changes. Our Board of Directors may make adjustments to the capital stock requirements within ranges established in our Capital Plan.

Each member must purchase and hold membership capital stock in an amount equal to 0.06 percent of its total assets as of the preceding December 31st, subject to a cap of $10.0 million and a floor of $10,000. Each member is also required to purchase activity-based capital stock equal to 4.50 percent of its advances, 4.00 percent of mortgage loans outstanding, and 0.10 percent of its standby letters of credit.

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Because membership is voluntary, a member can provide a notice of withdrawal from membership at any time. If a member provides a notice of withdrawal from membership, we will not repurchase or redeem any membership stock until five years from the date of receipt of a notice of withdrawal. To the extent membership is terminated involuntarily, we may elect to repurchase that institution's membership stock prior to the end of the five-year redemption period. If a member withdraws or is involuntarily terminated from membership and holds activity-based capital stock, we will repurchase any such stock that is not required to support remaining business activity with the institution.

A member may cancel any pending notice of redemption before the completion of the five-year redemption period by providing a written notice of cancellation. We charge a cancellation fee equal to a percentage of the par value of the shares of capital stock subject to redemption. This fee is currently set at a range of one to five percent depending on when we receive notice of cancellation from the member. Our Board of Directors retains the right to change the cancellation fee at any time. We will provide at least 15 days' written notice to each member of any adjustment or amendment to our cancellation fee.

We cannot repurchase or redeem any membership or activity-based capital stock if the repurchase or redemption would cause a member to be out of compliance with its required investment. In addition, there are statutory and regulatory restrictions on our obligation or right to redeem outstanding capital stock.

First, in no case may we redeem any capital stock if, following such redemption, we would fail to satisfy our minimum regulatory capital requirements. By law, all member holdings of our capital stock immediately become nonredeemable if we become undercapitalized.

Second, we are precluded by regulation from redeeming any capital stock without the prior approval of the Finance Agency if either our Board of Directors or the Finance Agency determines that we incurred or are likely to incur losses resulting in or likely to result in a charge against capital.

Third, we cannot redeem shares of capital stock from any member if the principal or interest on any consolidated obligation is not paid in full when due, or under certain circumstances if (i) we project, at any time, that we will fail to comply with statutory or regulatory liquidity requirements, or will be unable to timely and fully meet all of our current obligations, (ii) we actually fail to comply with statutory or regulatory liquidity requirements or to timely and fully meet all of our current obligations, or enter or negotiate to enter into an agreement with one or more other FHLBanks to obtain financial assistance to meet our current obligations, or (iii) the Finance Agency determines that we will cease to be in compliance with statutory or regulatory liquidity requirements, or will lack the capacity to timely or fully meet all of our current obligations.

If we are liquidated, after payment in full to our creditors, our stockholders will be entitled to receive the par value of their capital stock as well as any retained earnings, in an amount proportional to the stockholder's share of the total shares of capital stock. In the event of a merger or consolidation, our Board of Directors shall determine the rights and preferences of our stockholders, subject to applicable Finance Agency regulations, as well as any terms and conditions imposed by the Finance Agency.

*Regulatory Capital Stock*

The following table summarizes our regulatory capital stock by type of member (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Commercial banks | $3036 | $2804 |
| Savings institutions | 97 | 122 |
| Credit unions | 849 | 928 |
| Insurance companies | 2526 | 2134 |
| CDFIs | 1 | 1 |
| Total GAAP capital stock | 6509 | 5989 |
| MRCS | 30 | 9 |
| Total regulatory capital stock | $6539 | $5998 |

---

The increase in regulatory capital stock at December 31, 2025, when compared to December 31, 2024, was primarily due to an increase in activity-based capital stock resulting from an increase in advance balances. For additional information on our capital stock, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 11 — Capital](#i6940522039644a7690f9aab973fdec20_220)</u>."

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RETAINED EARNINGS

Our risk management policies outline a targeted level of retained earnings based on the amount we believe necessary to help protect the redemption value of capital stock, facilitate safe and sound operations, maintain regulatory capital ratios, and support our ability to pay a relatively stable dividend. We monitor our achievement of this targeted level and may utilize tools such as restructuring our balance sheet, generating additional income, reducing our risk exposures, increasing capital stock requirements, or reducing our dividends to achieve this level of retained earnings. At December 31, 2025 and 2024, our actual retained earnings exceeded our targeted level of retained earnings.

Under the JCE Agreement with all of the other FHLBanks, we are required to allocate 20 percent of our quarterly net income to a separate restricted retained earnings account until the balance of that account, calculated as of the last day of each calendar quarter, equals at least one percent of our average balance of outstanding consolidated obligations for the calendar quarter. The restricted retained earnings are not available to pay dividends and are presented separately on our Statements of Condition. At December 31, 2025 and 2024, our restricted retained earnings account totaled $1.3 billion and $1.1 billion. One percent of our average balance of outstanding consolidated obligations for the three months ended December 31, 2025, was $1.7 billion.

DIVIDENDS

Our Board of Directors may declare and pay different dividends for each subclass of capital stock. Dividend payments may be made in the form of cash and/or additional shares of capital stock. Historically, we have only paid cash dividends. By regulation, we may only pay dividends from current earnings or unrestricted retained earnings. We are prohibited from paying a dividend in the form of additional shares of capital stock if, after the issuance, the outstanding excess capital stock would be greater than one percent of our total assets. Our Board of Directors may not declare or pay dividends if it would result in our non-compliance with regulatory capital requirements.

Our dividend philosophy is to pay a consistent dividend equal to or greater than the current market rate for a highly-rated investment (i.e. SOFR), and at a rate that the Board of Directors believes is sustainable under current and projected earnings to maintain an appropriate level of capital and retained earnings. Our actual dividend is determined quarterly by our Board of Directors, based on policies, regulatory requirements, actual performance, and other considerations that the Board of Directors determines to be appropriate.

The following table summarizes dividend-related information (dollars in millions):

---

| | | |
|:---|:---|:---|
| | For the Years Ended | For the Years Ended |
| | December 31, | December 31, |
| | 2025 | 2024 |
| Aggregate cash dividends paid<sup>1</sup> | $575 | $561 |
| Effective combined annualized dividend rate paid on capital stock<sup>2</sup> | 9.16% | 8.64% |
| Annualized dividend rate paid on membership capital stock | 6.00% | 5.39% |
| Annualized dividend rate paid on activity-based capital stock | 9.75% | 9.31% |
| Average SOFR | 4.24% | 5.15% |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Includes aggregate cash dividends paid during the period. Amount excludes cash dividends paid on MRCS. For financial reporting purposes, these dividends were recorded as interest expense on our Statements of Income.

2&nbsp;&nbsp;&nbsp;&nbsp;Effective combined annualized dividend rate is paid on total capital stock, including MRCS.

**CRITICAL ACCOUNTING ESTIMATES**

The preparation of our financial statements in accordance with GAAP requires management to make a number of judgments, estimates, and assumptions that affect our reported results and disclosures. Given the assumptions and judgment used, we have identified fair value measurements as our critical accounting estimate.

For a discussion of recently adopted or issued accounting standards, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 2 — Recently Adopted and Issued Accounting Guidance](#i6940522039644a7690f9aab973fdec20_175)</u>." For additional information on our fair value estimates, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 1 — Summary of Significant Accounting Policies](#i6940522039644a7690f9aab973fdec20_169)</u>."

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Fair Value Measurements**

Fair values play an important role in our valuation of certain assets, liabilities, and hedging instruments. They are inherently subjective and may require the use of significant assumptions, adjustments, and judgment including, among others, discount rates, forward interest rates, and volatility assumptions. We evaluate our fair value measurements on an ongoing basis. While management believes our estimates and assumptions are reasonable based on historical experience and other factors, actual results could differ from those estimates and differences could be material to the financial statements.

We categorize our financial instruments carried at fair value into a three-level hierarchy. The hierarchy is based upon the observability of inputs used to value the asset or liability as of the measurement date. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. At December 31, 2025 and 2024, we did not carry any financial assets or liabilities, measured on a recurring basis, at fair value on our Statements of Condition based on unobservable inputs.

While all fair value measurements inherently have a significant level of estimation uncertainty, the following items are those most likely to have a material impact on our financial statements:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Trading and AFS Investment Securities*. Our valuation technique incorporates prices from third-party pricing vendors, that generally use various proprietary models to price investment securities. The inputs to those models are derived from various sources including, but not limited to, benchmark securities and yields, reported trades, dealer estimates, issuer spreads, bids, offers, and other market-related data. Since many investment securities do not trade on a daily basis, the pricing vendors use available information, as applicable, such as benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing to determine the prices for individual securities. Each pricing vendor has an established process in place to challenge investment valuations, which facilitates resolution of questionable prices we may identify. Periodically, we conduct reviews of our pricing vendors to confirm and further augment our understanding of the vendors' pricing processes, methodologies, and control procedures. In limited instances, when no prices are available from the designated pricing services, we obtain prices from dealers or use the purchase price if the investment security is unsettled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Derivative Assets and Liabilities and Related Hedged Items.* The fair value of our derivatives is generally estimated using standard valuation techniques such as a discounted cash flow analysis and includes variation margin payments for daily settled contracts. Our cash flow model utilizes market-observable inputs (inputs that are actively quoted and can be validated to external sources). These inputs include assumptions on discount rates, forward interest rates, and volatility. In limited instances, fair value estimates for derivatives may be obtained using an external pricing model that utilizes observable market data. For the related hedged items, the fair value is estimated using a discounted cash flow analysis which also considers assumptions on discount rates and volatility.

Throughout 2025, there were no material changes in our valuation techniques or primary inputs used to develop fair value measurements for investment securities or derivatives and the related hedged items. Further, the risk profile and composition of these instruments did not materially change when compared to prior year. Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 12 — Fair Value](#i6940522039644a7690f9aab973fdec20_229)</u>" for additional discussion on our fair value measurements, including the quantitative impact these fair value estimates had on our financial statements and disclosures at December 31, 2025 and 2024.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**LEGISLATIVE AND REGULATORY DEVELOPMENTS** 

**Regulatory Environment**

Certain significant regulatory actions and developments are summarized below.

We are subject to various legal and regulatory requirements and priorities. Certain actions, regulatory priorities, and areas of focus, such as deregulation, by the federal executive administration have changed and continue to change the regulatory environment. For example, the Finance Agency repealed the Fair Lending, Fair Housing, and Equitable Housing Finance Plans regulation applicable to the FHLBanks, effective March 9, 2026, citing the federal executive administration's deregulatory priorities. Furthermore, during 2025, withdrawals and rescissions of certain rules, proposed rules, and advisory, regulatory, or technical guidance, have affected, and likely will continue to affect, certain aspects of our business operations. These changes could have impact on our financial condition, results of operations, and reputation.

On January 20, 2026, the federal executive administration issued an executive order that seeks to restrict acquisitions by large institutional investors of single-family homes. Among other things, the executive order directs certain agencies, including the Finance Agency, to issue guidance to (i) prevent agencies and government-sponsored enterprises from providing for, approving, insuring, guaranteeing, securitizing, or facilitating the acquisition by a large institutional investor of a single-family home that could otherwise be purchased by an individual owner-occupant, or disposing of federal assets in a manner that transfers a single-family home to a large institutional investor; and (ii) promote sales to individual owner-occupants, including through anti-circumvention provisions, first-look policies, and disclosure requirements. The executive order also calls for legislative recommendations to codify related policies and directs certain agencies to conduct reviews and consider additional measures to combat speculation by large institutional investors in single-family housing markets. We are unable to predict the nature of the guidance, measures, or recommendations, or how any such measure may impact our business.

Considering the changes in the regulatory environment, there is uncertainty with respect to the ultimate result of future regulatory actions and the impact they may have on us and the FHLBank System. We also cannot predict the federal executive administration's actions on U.S. housing finance and GSEs, including relating to the revision or end of conservatorships of Fannie Mae and Freddie Mac or potential reforms or enhancements to their capital structure, the imposition of new requirements or limitations on their existing authorities or changes in the nature of their government-backed guarantees. Similarly, we cannot predict any corresponding impacts of GSE reform on the FHLBank System, the secondary mortgage and MBS markets, or the mortgage industry. We continue to monitor these actions as they evolve and to evaluate their potential impact on us. For a discussion of related risks, please refer to "<u>[Item 1A Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>."

**OFF-BALANCE SHEET ARRANGEMENTS**

In the ordinary course of business, we engage in financial transactions that, in accordance with GAAP, are not recorded on our Statements of Condition or may be recorded on our Statements of Condition in amounts that are different from the full contract or notional amount of the transactions. For additional information on our off-balance sheet arrangements, refer to "<u>[Item 8 — Financial Statements and Supplementary Data — Note 13 — Commitments and Contingencies](#i6940522039644a7690f9aab973fdec20_232)</u>."

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**RISK MANAGEMENT** 

&nbsp;&nbsp;&nbsp;&nbsp;

We have risk management policies, established by our Board of Directors, that allow us to monitor and control our exposure to various risks, including interest rate, liquidity, credit, operational, model, information security, legal, regulatory and compliance, strategic, and reputational, as well as capital adequacy. Our primary risk management objective is to manage our assets and liabilities in ways that ensure liquidity is available to our members and protect the par redemption value of our capital stock. We periodically evaluate our risk management policies in order to respond to changes in our financial position and general market conditions.

**Interest Rate Risk**

We define interest rate risk as the risk that changes in interest rates or spreads will adversely affect our financial condition (market value) or performance (income). Interest rate risk is the principal type of risk to which we are exposed, as our cash flows, and therefore earnings and equity value, can change significantly as interest rates change. Our general approach toward managing interest rate risk is to acquire and maintain a portfolio of assets, liabilities, and derivatives which, taken together, limit our expected exposure to interest rate risk. Our key interest rate risk measures are MVE and Projected 24-Month Income. Management regularly monitors these key measures, as discussed further in the sections below.

MARKET VALUE OF EQUITY

&nbsp;&nbsp;&nbsp;&nbsp;MVE measures the net present value of the Bank by either marking positions to market or discounting all future cash flows using market discount rates. MVE is measured as the market value of our assets minus the market value of our liabilities (excluding MRCS). MVE is an estimate of the Bank's value and takes into account short-term market price fluctuations.

The MVE calculation is derived by a model that uses market prices which are computed using interest rates. This model allows for items such as spreads, volatilities, and prepayment speeds, and assumes a run-off balance sheet. To ensure the accuracy of the MVE calculation, we benchmark the computed market prices of complex instruments, such as derivatives and mortgage assets, to market observed prices or dealers' quotes.

Interest rate risk stress tests of MVE involve instantaneous parallel and non-parallel changes in interest rates. The resulting percentage change in MVE from the base case value is an indication of longer-term repricing risk and option risk embedded in the balance sheet.

In an effort to protect MVE from large interest rate swings, we manage the interest rate risk of our balance sheet by using hedging transactions, such as issuing consolidated obligation bonds, including floating rate, simple bullet, callable, or other structured features, and entering into or canceling interest rate swaps, caps, floors, and swaptions.

We monitor and manage to MVE policy limits in an effort to ensure the stability of the Bank's value. Our policy limits are based on declines from the base case in parallel and non-parallel interest rate change scenarios. Any policy limit breach must be reported to the Enterprise Risk Committee of the Bank and the Risk and Compliance Committee of the Board of Directors and be remediated in a timely manner. At December 31, 2025 and 2024, we were in compliance with all MVE policy limits.

MVCS represents our MVE divided by the total outstanding shares of our capital stock (including MRCS). To ensure we remain adequately capitalized, we must ensure our MVCS remains at or above our $100 par value.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following tables show our base case and change from base case MVE in percent change, MVE policy limits, and MVCS, assuming instantaneous parallel changes in interest rates at December 31, 2025 and 2024:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | MVE Assuming Parallel Changes (dollars in millions) | MVE Assuming Parallel Changes (dollars in millions) | MVE Assuming Parallel Changes (dollars in millions) | MVE Assuming Parallel Changes (dollars in millions) | MVE Assuming Parallel Changes (dollars in millions) |
| | Down 200 | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 | $10858 | $10784 | $10669 | $10488 | $10310 |
| 2024 | $9553 | $9498 | $9400 | $9280 | $9148 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | % Change from Base Case | % Change from Base Case | % Change from Base Case | % Change from Base Case | % Change from Base Case |
| | Down 200 | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 | 1.8% | 1.1% | —% | (1.7)% | (3.4)% |
| 2024 | 1.6% | 1.0% | —% | (1.3)% | (2.7)% |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | Policy Limits (declines from base case) | Policy Limits (declines from base case) | Policy Limits (declines from base case) | Policy Limits (declines from base case) | Policy Limits (declines from base case) |
| | Down 200<sup>1</sup> | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 and 2024 | (7.5)% | (4.0)% | —% | (4.0)% | (7.5)% |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | MVCS Assuming Parallel Changes (dollars per share) | MVCS Assuming Parallel Changes (dollars per share) | MVCS Assuming Parallel Changes (dollars per share) | MVCS Assuming Parallel Changes (dollars per share) | MVCS Assuming Parallel Changes (dollars per share) |
| | Down 200 | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 | $166.0 | $164.9 | $163.1 | $160.4 | $157.7 |
| 2024 | $159.3 | $158.4 | $156.7 | $154.7 | $152.5 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;The down 200 basis point policy limit is suspended when the 10-year swap rate falls below a threshold for five consecutive days. At December 31, 2025 and 2024, the threshold was 1.50 percent and the 10-year swap rate was above this level; as such, the associated policy limits were in effect.

The following tables show our base case and change from base case MVE in percent change, MVE policy limits, and MVCS, assuming instantaneous non-parallel changes in interest rates at December 31, 2025 and 2024:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | MVE Assuming Non-Parallel Changes (dollars in millions) | MVE Assuming Non-Parallel Changes (dollars in millions) | MVE Assuming Non-Parallel Changes (dollars in millions) | MVE Assuming Non-Parallel Changes (dollars in millions) | MVE Assuming Non-Parallel Changes (dollars in millions) |
| | Down 200 | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 | $10838 | $10780 | $10669 | $10500 | $10340 |
| 2024 | $9549 | $9490 | $9400 | $9279 | $9141 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | % Change from Base Case | % Change from Base Case | % Change from Base Case | % Change from Base Case | % Change from Base Case |
| | Down 200 | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 | 1.6% | 1.0% | —% | (1.6)% | (3.1)% |
| 2024 | 1.6% | 1.0% | —% | (1.3)% | (2.8)% |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | Policy Limits (declines from base case) | Policy Limits (declines from base case) | Policy Limits (declines from base case) | Policy Limits (declines from base case) | Policy Limits (declines from base case) |
| | Down 200<sup>1</sup> | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 and 2024 | (7.5)% | (4.0)% | —% | (4.0)% | (7.5)% |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | MVCS Assuming Non-Parallel Changes (dollars per share) | MVCS Assuming Non-Parallel Changes (dollars per share) | MVCS Assuming Non-Parallel Changes (dollars per share) | MVCS Assuming Non-Parallel Changes (dollars per share) | MVCS Assuming Non-Parallel Changes (dollars per share) |
| | Down 200 | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 | $165.7 | $164.8 | $163.1 | $160.6 | $158.1 |
| 2024 | $159.2 | $158.2 | $156.7 | $154.7 | $152.4 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;The down 200 basis point policy limit is suspended when the 10-year swap rate falls below a threshold for five consecutive days. At December 31, 2025 and 2024, the threshold was 1.50 percent and the 10-year swap rate was above this level; as such, the associated policy limits were in effect.

Our base case MVE and MVCS increased at December 31, 2025, when compared to December 31, 2024, and the increase between periods was primarily attributable to an increase in retained earnings and improved valuations of multifamily MBS and our mortgage loan portfolio. In addition, our base case MVE improved primarily due to higher asset balances and increased invested capital, specifically activity-based capital stock.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

PROJECTED 24-MONTH INCOME

The projected 24-month income simulation measures our short-term earnings forecast over a two-year horizon based on forward interest rates and business assumptions. Our primary measure of profitability is the spread between projected AROCS and average SOFR. In this measure, AROCS adjusts GAAP net income for certain non-routine or unpredictable items, such as market value adjustments, prepayment fee income, and other non-routine items.

We monitor and manage to policy limits, which are based on the spread between our projected AROCS and average SOFR in parallel and non-parallel interest rate change scenarios. Additionally, there is a limit on the decline in projected AROCS from base case AROCS for certain basis shock scenarios to limit basis risk exposure. Any policy limit breach must be reported to the Enterprise Risk Committee of the Bank and the Risk and Compliance Committee of the Board of Directors and be remediated in a timely manner. We were in compliance with all projected 24-month income policy limits at December 31, 2025 and 2024.

The following tables show our projected 24-month AROCS spread to average SOFR and associated policy limits, assuming instantaneous parallel shifts in interest rates at December 31, 2025 and 2024:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | Projected AROCS Spread to SOFR  | Projected AROCS Spread to SOFR  | Projected AROCS Spread to SOFR  | Projected AROCS Spread to SOFR  | Projected AROCS Spread to SOFR  |
| | Down 200 | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 | 8.77% | 9.31% | 9.83% | 10.07% | 10.22% |
| 2024 | 7.60% | 8.27% | 8.60% | 8.81% | 9.00% |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | Policy Limits<sup>1</sup> | Policy Limits<sup>1</sup> | Policy Limits<sup>1</sup> | Policy Limits<sup>1</sup> | Policy Limits<sup>1</sup> |
| | Down 200<sup>1</sup> | Down 100 | Base Case | Up 100 | Up 200 |
| 2025 and 2024 | 1.75% | 1.75% | —% | 1.75% | 1.75% |

---

1&nbsp;&nbsp;&nbsp;&nbsp;The down 200 basis point policy limit is suspended when the 10-year swap rate falls below a threshold for five consecutive days. At December 31, 2025 and 2024, the threshold was 1.50 percent and the 10-year swap rate was above this level; as such, the associated policy was in effect.

The following tables show our projected 24-month AROCS spread to average SOFR and associated policy limits, assuming instantaneous non-parallel shifts in interest rates at December 31, 2025 and 2024:

---

| | | | |
|:---|:---|:---|:---|
| | Projected AROCS Spread to SOFR | Projected AROCS Spread to SOFR | Projected AROCS Spread to SOFR |
| | Down 100 | Base Case | Up 100 |
| 2025 | 9.80% | 9.83% | 9.89% |
| 2024 | 8.41% | 8.60% | 8.60% |

---

---

| | | | |
|:---|:---|:---|:---|
| | Policy Limits | Policy Limits | Policy Limits |
| | Down 100 | Base Case | Up 100 |
| 2025 and 2024 | 1.75% | —% | 1.75% |

---

The following tables show our change from base projected 24-month AROCS for index specific shock scenarios and our associated policy limits at December 31, 2025 and 2024:

---

| | |
|:---|:---|
| | Projected AROCS% Change from Base Case |
| 2025 | (0.11)% |
| 2024 | (0.19)% |

---

---

| | |
|:---|:---|
| | Policy Limit |
| | Base Case |
| 2025 | (1.00)% |
| 2024 | (1.75)% |

---

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

DERIVATIVES

We use derivatives to manage interest rate risk. Finance Agency regulations and our risk management policies establish guidelines for derivatives, prohibit the speculative use of derivatives, and limit credit risk arising from derivatives. Our hedging strategies include hedges of specific assets and liabilities that qualify for fair value hedge accounting and economic hedges that are used to reduce overall market risk exposure. All new hedging strategies are approved by our Asset-Liability Committee. See additional discussion regarding our derivative contracts in "<u>[Item 8. Financial Statements and Supplementary Data — Note 7 — Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205)</u>."

The following table summarizes our interest rate exchange agreements by type of hedged item, hedging instrument, associated hedging strategy, hedge accounting designation, and notional amount (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | | | December 31, | December 31, |
| Hedged Item / Hedging Instrument | Hedging Strategy | Hedge Accounting Designation | 2025<br> Notional Amount | 2024<br> Notional Amount |
| **Advances** |  |  |  |  |
| Pay-fixed, receive floating interest rate swap (without options) | Converts the advance's fixed rate to a variable rate index. | Fair Value | $58443 | $58344 |
|  |  | Economic | 35 |  |
| Pay-fixed, receive floating interest rate swap (with options) | Converts the advance's fixed rate to a variable rate index and offsets option risk in the advance. | Fair Value | 33 |  |
| **Investments** |  |  |  |  |
| Pay-fixed, receive floating interest rate swap | Converts the investment's fixed rate to a variable rate index. | Fair Value | 20490 | 18741 |
|  |  | Economic | 6246 | 4814 |
| **Mortgage Loans** |  |  |  |  |
| Mortgage loan purchase commitment | Represents a stand-alone derivative that exposes us to fair value risk due to the fixed rate purchase commitment. | Economic | 106 | 101 |
| Forward settlement agreement | Protects against changes in market value of fixed rate mortgage loan purchase commitments resulting from changes in interest rates. | Economic | 111 | 91 |
| **Bonds** |  |  |  |  |
| Receive-fixed or structured, pay floating interest rate swap (without options) | Converts the bond's fixed or structured rate to a variable rate index. | Fair Value | 5536 | 13750 |
| Receive-fixed or structured, pay floating interest rate swap (with options) | Converts the bond's fixed or structured rate to a variable rate index and offsets option risk in the bond. | Fair Value | 14872 | 8335 |
| **Discount Notes** |  |  |  |  |
| Receive-fixed, pay-float interest rate swap | Converts the discount note's fixed rate to a variable rate index. | Fair Value | 63394 |  |
|  |  | Economic | 16896 | 50918 |
| **Total** |  |  | $186162 | $155094 |

---

For more information on our hedging strategies, refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 7 — Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205)</u>."

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Capital Adequacy** 

An adequate capital position is necessary for facilitating safe and sound business operations, protecting the redemption value of our capital stock, maintaining regulatory capital ratios, and supporting our ability to pay dividends and redeem excess capital stock. To ensure capital adequacy, we maintain a targeted level of retained earnings to achieve business imperatives and cover unexpected losses. Our key capital adequacy measures are regulatory capital and targeted retained earnings in order to maintain capital levels in accordance with Finance Agency regulations. In addition, our risk management policies require that we maintain MVCS at or above our $100 par value.

For additional information on our compliance with regulatory capital requirements as well as our targeted retained earnings, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Capital.](#i57dfd06e31f94e2095e69a37b026d652_15617)</u>"

For additional information on MVCS, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Interest Rate Risk — Market Value of Equity](#ia9c5fd5e2848466f9a0482fdb160304d_29196)</u>."

**Liquidity Risk**

We define liquidity risk as the risk that we will be unable to meet our financial obligations as they come due or meet the credit needs of our members in a timely and cost-efficient manner. To manage this risk, we maintain liquidity in accordance with Finance Agency regulations. For additional information on our compliance with these requirements, refer to "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Liquidity — Liquidity Requirements](#i57dfd06e31f94e2095e69a37b026d652_15616)</u>."

**Credit Risk**

&nbsp;&nbsp;&nbsp;&nbsp;We define credit risk as the risk that a member or counterparty will fail to meet its financial obligations. Our primary credit risks arise from our ongoing lending, investing, and hedging activities. Our overall objective in managing credit risk is to operate a sound credit granting process and to maintain appropriate credit administration, measurement, and monitoring practices.

ADVANCES

&nbsp;&nbsp;&nbsp;&nbsp;We manage our credit exposure to advances through a lending policy that provides for an established credit limit for each borrower, ongoing reviews of each borrower's financial condition and ability to repay, and detailed collateral and lending policies to limit risk of loss while balancing borrowers' needs for a reliable source of funding. In addition, we lend to our borrowers in accordance with the FHLBank Act, Finance Agency regulations, and other applicable laws.

We are required by regulation to evaluate our members' creditworthiness and ability to repay, and to obtain sufficient collateral to fully secure our advances, standby letters of credit, and other extensions of credit to borrowers (collectively, credit products). The estimated value of the collateral required to secure each borrower's credit products is calculated by applying loan-to-value discounts, or haircuts, to the unpaid principal or market value, as applicable, of the collateral. We also have policies and procedures for validating the reasonableness of our collateral valuations. In addition, we perform collateral verifications and on-site reviews based on the risk profile of the borrower. Management believes that these policies effectively manage our credit risk from advances.

&nbsp;&nbsp;&nbsp;&nbsp;At December 31, 2025 and 2024, borrowers pledged $442.4 billion and $388.8 billion of collateral (net of applicable discounts) to support activity with us, including advances. At December 31, 2025 and 2024, all of our advances met the requirement to be collateralized at a minimum of 100 percent, net of applicable discounts. Borrowers pledge collateral in excess of their collateral requirement mainly to demonstrate available liquidity and to borrow additional amounts in the future.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table shows the amount of collateral pledged to us (net of applicable discounts) (dollars in billions):&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | |
|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| Collateral Type | Discount Range<sup>1</sup> | Amount | % of Total |
| Single-family loans | 20-31 | $238.6 | 54 |
| Multi-family loans | 31 | 33.7 | 8 |
| Other real estate | 26-53 | 117.2 | 26 |
| Securities |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash, agency securities and residential MBS | 0-28 | 40.1 | 9 |
| &nbsp;&nbsp;&nbsp;Commercial MBS | 15 | 8.4 | 2 |
| Government-insured loans | 15-25 | 0.9 |  |
| Secured small business and agri-business loans | 40 | 3.5 | 1 |
| Total |  | $442.4 | 100 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents the discount or the range of discounts applied to the unpaid principal balance or market value of collateral pledged.

&nbsp;&nbsp;&nbsp;&nbsp;We evaluate advances for credit losses on a quarterly basis and have never experienced a credit loss on our advances. Based upon our collateral and lending policies, the collateral held as security, and the repayment history on advances, management has determined that there were no expected credit losses on our advances as of December 31, 2025 and 2024. Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 5 — Advances](#i6940522039644a7690f9aab973fdec20_193)</u>" for additional information on our eligible collateral types, collateral practices, and allowance for credit losses.

MORTGAGE LOANS

Mortgage loan credit risk is the risk that we will not receive timely payments of principal and interest due from mortgage borrowers because of borrower defaults. Credit risk on mortgage loans is affected by a number of factors, including loan type, borrower's credit history, and other factors such as home price fluctuations, unemployment levels, and other economic factors in the local market or nationwide.

The following table presents the unpaid principal balance of our mortgage loans by product type (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| Product Type | 2025 | 2024 |
| Conventional | $14097 | $11452 |
| Government | 356 | 365 |
| Total unpaid principal balance | $14453 | $11817 |

---

We manage the credit risk on mortgage loans by (i) adhering to our underwriting standards, (ii) using agreements to establish credit risk sharing responsibilities with our PFIs, and (iii) monitoring the performance of the mortgage loan portfolio and creditworthiness of PFIs.

We evaluate mortgage loans for credit losses on a quarterly basis and establish an allowance for credit losses to reflect management's estimate of expected credit losses inherent in the portfolio. At December 31, 2025 and 2024, the allowance for credit losses on our conventional mortgage loans was $6 million and $5 million. At December 31, 2025, over 99 percent of our conventional loan portfolio was performing (i.e. current payment status) and charge-offs recorded during the year ended December 31, 2025, were less than one percent of the total conventional portfolio.

We have never experienced a credit loss on our government-insured mortgage loans. At December 31, 2025 and 2024, we determined no allowance for credit losses was necessary on our government-insured mortgage loans.

Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 6 — Mortgage Loans Held for Portfolio](#i6940522039644a7690f9aab973fdec20_199)</u>" for additional information on our allowance for credit losses and the payment status of our conventional mortgage loans.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table presents supplemental information on our mortgage loans (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| Unpaid Principal Balance | 2025 | 2024 |
| Average mortgage loans outstanding during the period | $13098 | $10808 |
| Mortgage loans held for portfolio | 14453 | 11817 |
| Non-accrual loans | 62 | 48 |
| Allowance for credit losses on mortgage loans held for portfolio | (6) | (5) |
| Net charge-offs (recoveries)<sup>1</sup> |  |  |
| Ratio of net charge-offs (recoveries) to average mortgage loans outstanding during the period<sup>1</sup> | —% | —% |
| Ratio of allowance for credit losses to mortgage loans held for portfolio | 0.04% | 0.04% |
| Ratio of non-accrual loans to mortgage loans held for portfolio | 0.43% | 0.41% |
| Ratio of allowance for credit losses to non-accrual loans | 8.84% | 9.44% |

---

1 &nbsp;&nbsp;&nbsp;&nbsp;Net charge-offs and recoveries were less than $1 million at both December 31, 2025 and 2024.

The following table shows our conventional mortgage loans by FICO<sup>®</sup> score. All percentages are calculated based on unpaid principal balances as of the period end.

---

| | |
|:---|:---|
| FICO<sup>®</sup> Score<sup>1</sup> | December 31, 2025 |
| 620 to < 660 | 4% |
| 660 to < 700 | 10 |
| 700 to < 740 | 20 |
| >= 740 | 66 |
| Total | 100% |
| Weighted average FICO score | 752 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents the lowest original FICO® score of the borrowers and co-borrowers.

The following table shows our conventional mortgage loans by loan-to-value ratio. All percentages are calculated based on unpaid principal balances as of the period end.

---

| | |
|:---|:---|
| Loan-to-Value<sup>1</sup> | December 31, 2025 |
| <= 60% | 13% |
| > 60% to 70% | 11 |
| > 70% to 80% | 46 |
| > 80% to 90%<sup>2</sup> | 14 |
| > 90%<sup>2</sup> | 16 |
| Total | 100% |
| Weighted average loan-to-value | 77% |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents the loan-to-value at origination for the related loan.

2&nbsp;&nbsp;&nbsp;&nbsp;These conventional loans were required to have PMI at origination.

The following table shows the five largest state concentrations of our conventional mortgage loan portfolio. All percentages are calculated based on unpaid principal balances as of the period end.

---

| | |
|:---|:---|
| | December 31, 2025 |
| Minnesota | 21% |
| Missouri | 20 |
| Iowa | 20 |
| South Dakota | 8 |
| Idaho | 6 |
| All others | 25 |
| Total | 100% |

---

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

INVESTMENTS

&nbsp;&nbsp;&nbsp;&nbsp;We maintain an investment portfolio primarily to provide liquidity as well as investment income. Our primary credit risk on investments is the counterparties' ability to meet repayment terms. We mitigate this credit risk by purchasing investment quality securities. We define investment quality as a security with adequate financial backings so that full and timely payment of principal and interest on such security is expected and there is minimal risk that the timely payment of principal and interest would not occur because of adverse changes in economic and financial conditions during the projected life of the security. We consider a variety of credit quality factors when analyzing potential investments, including collateral performance, marketability, asset class or sector considerations, local and regional economic conditions, NRSRO credit ratings, and/or the financial health of the underlying issuer. We limit our purchases of MBS to those guaranteed by the U.S. Government or issued by a GSE. We perform ongoing analysis on these investments in an effort to determine potential credit issues.

Finance Agency regulations also limit the type of investments we may purchase. We are prohibited from investing in financial instruments issued by non-U.S. entities other than those issued by U.S. branches and agency offices of foreign commercial banks, unless otherwise approved by the Finance Agency. Our unsecured credit exposures to U.S. branches and agency offices of foreign commercial banks include the risk that, as a result of political or economic conditions in a country, the counterparty may be unable to meet their contractual repayment obligations. Our unsecured credit exposures to domestic counterparties and U.S. subsidiaries of foreign commercial banks include the risk that these counterparties have extended credit to foreign counterparties. At December 31, 2025, we were in compliance with the above regulation and did not own any financial instruments issued by non-U.S. entities, other than those issued by U.S. branches and agency offices of foreign commercial banks, and those approved by the Finance Agency.

In addition, Finance Agency regulations include limits on the amount of unsecured credit we may extend to a counterparty or to a group of affiliated counterparties. These limits are based on a percentage of regulatory capital and the counterparty's overall credit rating. Under these regulations, the level of regulatory capital is determined as the lesser of our total regulatory capital or the amount of regulatory capital of the counterparty. The amount of regulatory capital is then multiplied by a stated percentage. The percentage that we may offer for extensions of unsecured credit, excluding overnight federal funds sold, ranges from one to 15 percent based on the counterparty's credit rating. Our total unsecured exposure to a counterparty, including overnight federal funds sold, may not exceed twice that amount, or a total of two to 30 percent of the amount of regulatory capital, based on the counterparty's credit rating. At December 31, 2025, we were in compliance with the regulatory limits established for unsecured credit.

Our short-term portfolio may include, but is not limited to, interest-bearing deposits, federal funds sold, securities purchased under agreements to resell, certificates of deposit, commercial paper, and U.S. Treasury obligations. Our long-term portfolio may include, but is not limited to, U.S. Treasury obligations, other U.S. obligations, GSE and TVA obligations, state or local housing agency obligations, taxable municipal bonds, and agency MBS. We consider our long-term investments issued or guaranteed by the U.S. Government, an agency or instrumentality of the U.S. Government, or the FDIC to be of the highest credit quality and therefore those exposures are not monitored with other unsecured investments. Given the credit quality of our unsecured long-term investments, our unsecured credit risk is primarily in the short-term portfolio.

We limit short-term unsecured credit exposure primarily to the following overnight investment types:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Interest-bearing deposits.* Primarily consists of unsecured deposits that earn interest.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Federal funds sold.* Unsecured loans of reserve balances at the Federal Reserve Banks between financial institutions.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

At December 31, 2025, our unsecured short-term investment exposure consisted of overnight interest-bearing deposits and federal funds sold. The following table presents our unsecured short-term investment exposure by counterparty credit rating and domicile (excluding accrued interest receivable) (dollars in millions):

---

| | | | |
|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Credit Rating<sup>1,2</sup> | Credit Rating<sup>1,2</sup> | Credit Rating<sup>1,2</sup> |
| Domicile of Counterparty | AA | A | Total |
| Domestic | $535 | $3185 | $3720 |
| U.S. branches and agency offices of foreign commercial banks |  |  |  |
| &nbsp;&nbsp;&nbsp;Australia | 1450 |  | 1450 |
| &nbsp;&nbsp;Belgium |  | 500 | 500 |
| &nbsp;&nbsp;&nbsp;Canada |  | 2330 | 2330 |
| &nbsp;&nbsp;&nbsp;Finland | 200 |  | 200 |
| &nbsp;&nbsp;&nbsp;Germany | 750 |  | 750 |
| &nbsp;&nbsp;&nbsp;Netherlands |  | 400 | 400 |
| &nbsp;&nbsp;United Kingdom |  | 300 | 300 |
| Total U.S. branches and agency offices of foreign commercial banks | 2400 | 3530 | 5930 |
| Total unsecured short-term investment exposure | $2935 | $6715 | $9650 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents either the lowest credit rating available for each counterparty based on an NRSRO, or the guarantor credit rating, if applicable. In instances where an NRSRO rating or guarantor rating is not available for the investment, the investment is classified as unrated.

2&nbsp;&nbsp;&nbsp;&nbsp;Table excludes investments issued or guaranteed by the U.S. Government, U.S. government agencies, government instrumentalities, GSEs, and supranational entities, and does not include related accrued interest.

The following table summarizes the carrying value of our investments by credit rating (dollars in millions):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Credit Rating<sup>1</sup> | Credit Rating<sup>1</sup> | Credit Rating<sup>1</sup> | Credit Rating<sup>1</sup> | Credit Rating<sup>1</sup> |
| | AAA | AA | A | Unrated | Total |
| Interest-bearing deposits<sup>2</sup> | $— | $541 | $3185 | $— | $3726 |
| Securities purchased under agreements to resell<sup>3</sup> |  | 1500 | 4900 | 10690 | 17090 |
| Federal funds sold |  | 2400 | 3530 |  | 5930 |
| Investment securities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;MBS |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE single-family |  | 516 |  |  | 516 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE multifamily |  | 20882 |  |  | 20882 |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S. obligations single-family<sup>4</sup> |  | 5708 |  |  | 5708 |
| &nbsp;&nbsp;&nbsp;&nbsp;Private-label residential |  |  |  | 2 | 2 |
| &nbsp;&nbsp;&nbsp;Total MBS |  | 27106 |  | 2 | 27108 |
| &nbsp;&nbsp;&nbsp;Non-MBS |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S. Treasury obligations<sup>4</sup> |  | 6104 |  |  | 6104 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other U.S. obligations<sup>4</sup> |  | 71 |  |  | 71 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations |  | 482 |  |  | 482 |
| &nbsp;&nbsp;&nbsp;&nbsp;State or local housing agency obligations | 259 | 132 |  |  | 391 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other<sup>5</sup> | 94 | 19 |  |  | 113 |
| &nbsp;&nbsp;&nbsp;Total non-MBS | 353 | 6808 |  |  | 7161 |
| Total investments | $353 | $38355 | $11615 | $10692 | $61015 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents either the lowest credit rating available for each investment based on an NRSRO, or the guarantor credit rating, if applicable. In instances where an NRSRO rating or guarantor rating is not available for the investment, the investment is classified as unrated.

2&nbsp;&nbsp;&nbsp;&nbsp;Balance includes $6 million of interest-bearing deposits with another FHLBank. These investments are rated AA, based on the credit rating of the FHLBank System.

3&nbsp;&nbsp;&nbsp;&nbsp;Although a portion of the securities purchased under agreements to resell is with unrated counterparties, the underlying collateral supporting these investments is investment grade.

4&nbsp;&nbsp;&nbsp;&nbsp;Represents investment securities backed by the full faith and credit of the U.S. Government.

5&nbsp;&nbsp;&nbsp;&nbsp;Consists of taxable municipal bonds.

&nbsp;&nbsp;&nbsp;&nbsp;

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

We evaluate investments for credit losses on a quarterly basis. At December 31, 2025 and 2024, we determined no allowance for credit losses was necessary on our investments. Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 4 — Investments](#i6940522039644a7690f9aab973fdec20_184)</u>" for additional information our allowance for credit losses.

DERIVATIVES

&nbsp;&nbsp;&nbsp;&nbsp;We execute most of our derivative transactions with large banks and major broker-dealers. Over-the-counter derivative transactions may be either executed directly with a counterparty, referred to as uncleared derivatives, or cleared through a clearing agent with a clearinghouse, referred to as cleared derivatives.

We are subject to credit risk due to the risk of nonperformance by counterparties to our derivative agreements. The amount of credit risk on derivatives depends on the extent to which netting procedures and collateral requirements are used and are effective in mitigating the risk. We manage credit risk through credit analysis of derivative counterparties, collateral requirements, and adherence to the requirements set forth in our policies, CFTC regulations, and Finance Agency regulations.

*Uncleared Derivatives*. Uncleared derivative transactions executed on or after September 1, 2022 are subject to two-way initial margin requirements, if our aggregate uncleared derivative transactions exposure to a counterparty exceeds a specified threshold. The initial margin is required to be held at a third-party custodian and does not change ownership. Rather, the party in respect of which the initial margin has been posted to the third-party custodian will have a security interest in the amount of initial margin required under the uncleared margin rules and can only take ownership upon the occurrence of certain events, including an event of default due to bankruptcy, insolvency, or similar proceeding. Uncleared derivative agreements are also fully collateralized with a zero unsecured threshold in accordance with variation margin requirements issued by the U.S. federal bank regulatory agencies and the CFTC. As a result of these risk mitigation initiatives, we do not anticipate any credit losses on our uncleared derivative agreements.

*Cleared Derivatives*. For cleared derivatives, the clearinghouse is our counterparty. We are subject to risk of nonperformance by the clearinghouse and clearing agent. The requirement that we post initial and variation margin through the clearing agent, to the clearinghouse, exposes us to institutional credit risk in the event that the clearing agent or the clearinghouse fails to meet its obligations. However, the use of cleared derivatives is intended to mitigate credit risk exposure because a central counterparty is substituted for individual counterparties and collateral/payments are posted daily, through a clearing agent, for changes in the fair value of cleared derivatives. We do not anticipate any credit losses on our cleared derivatives.

The contractual or notional amount of derivatives reflects our involvement in the various classes of financial instruments. Our maximum credit risk is the estimated cost of replacing derivatives if there is a default, minus the value of any related collateral. In determining maximum credit risk, we consider accrued interest receivables and payables as well as our ability to net settle positive and negative positions with the same counterparty and/or clearing agent when netting requirements are met.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table shows our derivative counterparty credit exposure (dollars in millions):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| Credit Rating<sup>1</sup> | Notional Amount | Net Derivatives<br>Fair Value Before Collateral | Cash Collateral Pledged <br>To (From) Counterparty | Non-cash Collateral Pledged <br>To (From) Counterparty | Net Credit Exposure<br> to Counterparties |
| Non-member counterparties: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Asset positions with credit exposure |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Uncleared derivatives |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A | $3946 | $49 | $(48) | $— | $1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cleared derivative<sup>3</sup> | 170300 | 79 | 1 | 1390 | 1470 |
| &nbsp;&nbsp;&nbsp;Liability positions with credit exposure |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Uncleared derivatives |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A<sup>2</sup> | 2661 | (2) | 2 |  |  |
| Total derivative positions with credit exposure to non-member counterparties | 176907 | 126 | (45) | 1390 | 1471 |
| Member institutions<sup>2,4</sup> | 87 |  |  |  |  |
| Total | 176994 | $126 | $(45) | $1390 | $1471 |
| Derivative positions without credit exposure | 9168 |  |  |  |  |
| Total notional | $186162 |  |  |  |  |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents either the lowest credit rating available for each counterparty based on an NRSRO, or the guarantor credit rating, if applicable.

2&nbsp;&nbsp;&nbsp;&nbsp;Net credit exposure is less than $1 million.

3&nbsp;&nbsp;&nbsp;&nbsp;Represents derivative transactions cleared with CME Clearing and LCH Ltd, our clearinghouses. CME Clearing is not rated, but its parent, CME Group Inc. was rated Aa3 by Moody's and AA- by S&P at December 31, 2025. LCH Ltd. was rated AA- by S&P at December 31, 2025.

4&nbsp;&nbsp;&nbsp;&nbsp;Represents mortgage loan purchase commitments with our member institutions.

Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Note 7 — Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205)</u>" for additional information on our derivatives and hedging activities.

**Operational Risk**

We define operational risk as the risk of loss arising from inadequate or failed processes, people, and/or systems, including those emanating from external sources. All of our activities and processes generate operational risk. Management has established policies, procedures, and controls to reduce the level of operational risk. We perform annual risk assessments to identify, assess, mitigate, and report on operational risks outside of the Board's risk appetite. Due to the manual nature of many of our processes, our operational risk exposure is closely monitored. Refer to "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>" for additional information.

**Model Risk**

We define model risk as the risk of adverse consequences from decisions due to model utilization. Throughout the course of our day-to-day activities, we utilize external and internal pricing and financial models as important inputs into business and risk management decision-making processes.&nbsp;&nbsp;&nbsp;&nbsp;

Models are inherently imperfect predictors of actual results because they are based on assumptions about future performance. Changes in any models or in any of the assumptions, judgments, or estimates used in the models may cause the results generated by the model to be materially different. Refer to "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>" for additional information.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Information Security Risk**

We define information security risk as the risk arising from unauthorized access, use, disclosure, disruption, modification, or destruction of information or information systems. Importantly, this definition includes the confidentiality, integrity, and availability of both digital and non-digital information managed within information systems and processes. Refer to "<u>[Item 1C. Cybersecurity](#i6940522039644a7690f9aab973fdec20_25)</u>" for additional information.

**Legal, Regulatory, and Compliance Risk**

We define legal, regulatory, and compliance risk as the risk of violations of laws, rules, regulations, regulatory and supervisory guidance, and internal enterprise governing documents. Our legal and compliance departments are responsible for coordinating with various business units in connection with the identification, evaluation, and mitigation of our legal, regulatory, and compliance risks. We manage compliance risk by the development of, and adherence to, appropriate policies, procedures, and controls.

**Strategic Risk**

We define strategic risk as the risk arising from adverse strategic business decisions, poor implementation of strategic plans, or a lack of responsiveness to changes in the industry and operating environment. Strategic risk includes legislative risk. From time to time, proposals are made, or legislative and regulatory changes are considered, which could affect our cost of doing business or other aspects of our business. To support our mission, we endeavor to manage and mitigate strategic risk through the business planning process and by monitoring the external environment.

**Reputational Risk**

We define reputational risk as the risk arising from negative publicity that could adversely affect our reputation and consequently our financial performance or ability to meet our key business objectives. We manage reputational risk by the identification of emerging risks, development of crisis response and contingency plans, and monitoring the effectiveness of the overall risk management processes.

For additional information on some of the more important risks we face, refer to "<u>[Item 1A. Risk Factors](#i6940522039644a7690f9aab973fdec20_19)</u>."

**<u>ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</u>**

See "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Risk Management — Interest Rate Risk](#ia9c5fd5e2848466f9a0482fdb160304d_29195)</u>" and the sections referenced therein for quantitative and qualitative disclosures about market risk.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**<u>ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA</u>** 

---

| | |
|:---|:---|
| **AUDITED FINANCIAL STATEMENTS:** | **AUDITED FINANCIAL STATEMENTS:** |
| [Report of Independent Registered Public Accounting Firm](#i6940522039644a7690f9aab973fdec20_142) (PCAOB ID 238) | [64](#i6940522039644a7690f9aab973fdec20_142) |
| [Statements of Condition](#i6940522039644a7690f9aab973fdec20_148) | [66](#i6940522039644a7690f9aab973fdec20_148) |
| [Statements of Income](#i6940522039644a7690f9aab973fdec20_151) | [67](#i6940522039644a7690f9aab973fdec20_151) |
| [Statements of Comprehensive Income](#i6940522039644a7690f9aab973fdec20_154) | [68](#i6940522039644a7690f9aab973fdec20_154) |
| [Statements of Capital](#i6940522039644a7690f9aab973fdec20_157) | [69](#i6940522039644a7690f9aab973fdec20_157) |
| [Statements of Cash Flows](#i6940522039644a7690f9aab973fdec20_160) | [70](#i6940522039644a7690f9aab973fdec20_160) |
| [Notes to the Financial Statements](#i6940522039644a7690f9aab973fdec20_163) | [72](#i6940522039644a7690f9aab973fdec20_163) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Background Information](#i6940522039644a7690f9aab973fdec20_166) | [72](#i6940522039644a7690f9aab973fdec20_166) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 1 - Summary of Significant Accounting Policies](#i6940522039644a7690f9aab973fdec20_169) | [72](#i6940522039644a7690f9aab973fdec20_169) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 2 - Recently Adopted and Issued Accounting Guidance](#i6940522039644a7690f9aab973fdec20_175) | [80](#i6940522039644a7690f9aab973fdec20_175) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 3 - Cash and Due from Banks](#i6940522039644a7690f9aab973fdec20_181) | [81](#i6940522039644a7690f9aab973fdec20_181) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 4 - I](#i6940522039644a7690f9aab973fdec20_184)nvestments | [81](#i6940522039644a7690f9aab973fdec20_184) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 5 - Advances](#i6940522039644a7690f9aab973fdec20_193) | [87](#i6940522039644a7690f9aab973fdec20_193) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 6 - Mortgage Loans Held for Portfolio](#i6940522039644a7690f9aab973fdec20_199) | [89](#i6940522039644a7690f9aab973fdec20_199) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 7 - Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205) | [92](#i6940522039644a7690f9aab973fdec20_205) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 8 - Deposits](#i6940522039644a7690f9aab973fdec20_211) | [99](#i6940522039644a7690f9aab973fdec20_211) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 9 - Consolidated Obligations](#i6940522039644a7690f9aab973fdec20_214) | [99](#i6940522039644a7690f9aab973fdec20_214) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 10 - Affordable Housing Program](#i6940522039644a7690f9aab973fdec20_217) | [101](#i6940522039644a7690f9aab973fdec20_217) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 11 - Capital](#i6940522039644a7690f9aab973fdec20_220) | [101](#i6940522039644a7690f9aab973fdec20_220) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 12 - Fair Value](#i6940522039644a7690f9aab973fdec20_229) | [104](#i6940522039644a7690f9aab973fdec20_229) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 13 - Commitments and Contingencies](#i6940522039644a7690f9aab973fdec20_232) | [112](#i6940522039644a7690f9aab973fdec20_232) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 14 - Activities with Stockholders](#i6940522039644a7690f9aab973fdec20_238) | [113](#i6940522039644a7690f9aab973fdec20_238) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Note 15 - Activities with Other FHLBanks](#i6940522039644a7690f9aab973fdec20_241) | [115](#i6940522039644a7690f9aab973fdec20_241) |

---

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Report of Independent Registered Public Accounting Firm**

To the Board of Directors and Shareholders of the Federal Home Loan Bank of Des Moines

***Opinions on the Financial Statements and Internal Control over Financial Reporting***

We have audited the accompanying statements of condition of the Federal Home Loan Bank of Des Moines (the "Bank") as of December 31, 2025 and 2024, and the related statements of income, comprehensive income, capital, and cash flows for each of the three years in the period ended December 31, 2025, including the related notes (collectively referred to as the "financial statements"). We also have audited the Bank's internal control over financial reporting as of December 31, 2025, based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Bank as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Bank maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the COSO.

***Basis for Opinions***

The Bank's management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Report of Management on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Bank's financial statements and on the Bank's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Bank in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

***Definition and Limitations of Internal Control over Financial Reporting***

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

***Critical Audit Matters***

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

*Valuation of Interest-Rate Related Derivatives*

As described in Notes 7 and 12 to the financial statements, as of December 31, 2025, the fair value of the Bank's derivative assets and liabilities was $80 million and $3 million, respectively. The fair value of derivatives is generally estimated using standard valuation techniques such as a discounted cash flow model. For interest-rate related derivatives, management's discounted cash flow model utilizes market-observable inputs, including the discount rate, forward interest rate, and volatility assumptions.

The principal considerations for our determination that performing procedures relating to the valuation of interest-rate related derivatives is a critical audit matter are (i) the high degree of audit effort in performing procedures related to the valuation of interest-rate related derivatives; and (ii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the financial statements. These procedures included testing the effectiveness of controls relating to the valuation of interest-rate related derivatives. These procedures also included, among others, (i) testing the completeness and accuracy of certain data provided by management and (ii) the involvement of professionals with specialized skill and knowledge to assist in evaluating the reasonableness of management's estimate by (a) developing an independent estimate of fair value for a sample of interest-rate related derivatives using independent market observable inputs, including the discount rate, forward interest rate, and volatility assumptions and (b) comparing the independently developed estimate of fair value to management's estimate.

/s/ PricewaterhouseCoopers LLP

Chicago, Illinois

March 10, 2026

We have served as the Bank's auditor since 1990.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**FEDERAL HOME LOAN BANK OF DES MOINES** 

**STATEMENTS OF CONDITION** 

**(dollars and shares in millions, except capital stock par value)**

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| **ASSETS** |  |  |
| Cash and due from banks (Note 3) | $44 | $41 |
| Interest-bearing deposits (Note 4) | 3726 | 4096 |
| Securities purchased under agreements to resell (Note 4) | 17090 | 11950 |
| Federal funds sold (Note 4) | 5930 | 5175 |
| Investment securities (Note 4) |  |  |
| &nbsp;&nbsp;Trading securities (includes $1,390 and $533 pledged as collateral that may be repledged) | 6303 | 4720 |
| &nbsp;&nbsp;Available-for-sale securities (amortized cost of $27,336 and $25,358) | 27519 | 25331 |
| &nbsp;&nbsp;Held-to-maturity securities (fair value of $452 and $757) | 447 | 760 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total investment securities | 34269 | 30811 |
| Advances (Note 5) | 110230 | 99951 |
| Mortgage loans held for portfolio, net of allowance for credit losses of $6 and $5 (Note 6) | 14540 | 11896 |
| Accrued interest receivable | 461 | 400 |
| Derivative assets, net (Note 7) | 80 | 804 |
| Other assets, net | 129 | 129 |
| &nbsp;&nbsp;&nbsp;&nbsp;**TOTAL ASSETS** | $186499 | $165253 |
| **LIABILITIES** |  |  |
| Deposits (Note 8) |  |  |
| &nbsp;&nbsp;&nbsp;Interest-bearing | $970 | $1195 |
| &nbsp;&nbsp;&nbsp;Non-interest-bearing | 177 | 119 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total deposits | 1147 | 1314 |
| Consolidated obligations (Note 9) |  |  |
| &nbsp;&nbsp;Discount notes (includes $17,382 and $52,349 at fair value held under fair value option) | 84620 | 64680 |
| &nbsp;&nbsp;&nbsp;Bonds | 89249 | 88571 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total consolidated obligations | 173869 | 153251 |
| Mandatorily redeemable capital stock (Note 11) | 30 | 9 |
| Accrued interest payable | 589 | 717 |
| Affordable Housing Program payable (Note 10) | 301 | 262 |
| Derivative liabilities, net (Note 7) | 3 | 6 |
| Other liabilities | 73 | 243 |
| &nbsp;&nbsp;&nbsp;&nbsp;**TOTAL LIABILITIES** | 176012 | 155802 |
| Commitments and contingencies (Note 13) |  |  |
| **CAPITAL (Note 11)** |  |  |
| Capital stock - Class B putable ($100 par value); 65,090,978 and 59,886,959 issued and outstanding shares | 6509 | 5989 |
| Retained earnings |  |  |
| &nbsp;&nbsp;&nbsp;Unrestricted | 2543 | 2413 |
| &nbsp;&nbsp;&nbsp;Restricted | 1254 | 1078 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total retained earnings | 3797 | 3491 |
| Accumulated other comprehensive income (loss) | 181 | (29) |
| &nbsp;&nbsp;&nbsp;&nbsp;**TOTAL CAPITAL** | 10487 | 9451 |
| &nbsp;&nbsp;&nbsp;&nbsp;**TOTAL LIABILITIES AND CAPITAL** | $186499 | $165253 |

---

The accompanying notes are an integral part of these financial statements.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**FEDERAL HOME LOAN BANK OF DES MOINES** 

**STATEMENTS OF INCOME** 

**(dollars in millions)**

---

| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| **INTEREST INCOME** |  |  |  |
| Advances | $5070 | $6009 | $6506 |
| Prepayment fees on advances, net | 10 | 4 | 27 |
| Interest-bearing deposits | 194 | 270 | 217 |
| Securities purchased under agreements to resell | 565 | 530 | 542 |
| Federal funds sold | 526 | 671 | 757 |
| Trading securities | 216 | 108 | 41 |
| Available-for-sale securities | 1390 | 1484 | 1203 |
| Held-to-maturity securities | 32 | 41 | 44 |
| Mortgage loans held for portfolio | 602 | 452 | 319 |
| Loans to other FHLBanks |  |  | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest income | 8605 | 9569 | 9657 |
| **INTEREST EXPENSE** |  |  |  |
| Consolidated obligations - Discount notes | 2829 | 3456 | 2910 |
| Consolidated obligations - Bonds | 4578 | 4821 | 5392 |
| Deposits | 44 | 54 | 47 |
| Borrowings from other FHLBanks | 1 | 1 | 1 |
| Mandatorily redeemable capital stock | 3 | 1 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest expense | 7455 | 8333 | 8351 |
| **NET INTEREST INCOME** | 1150 | 1236 | 1306 |
| Provision (reversal) for credit losses on mortgage loans | 1 | (1) | 1 |
| **NET INTEREST INCOME AFTER PROVISION (REVERSAL) FOR CREDIT LOSSES** | 1149 | 1237 | 1305 |
| **OTHER INCOME (LOSS)** |  |  |  |
| Net gains (losses) on trading securities | 97 | 18 | 93 |
| Net gains (losses) on financial instruments held under fair value option | 12 | (31) | (92) |
| Net gains (losses) on derivatives | (51) | 8 | (41) |
| Net gains (losses) on extinguishment of debt |  |  | 2 |
| Other, net | 42 | 42 | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total other income (loss) | 100 | 37 | (15) |
| **OTHER EXPENSE** |  |  |  |
| Compensation and benefits | 82 | 78 | 77 |
| Contractual services | 27 | 26 | 23 |
| Professional fees | 14 | 19 | 16 |
| Other operating expenses | 24 | 21 | 22 |
| Voluntary community and housing contributions | 78 | 68 | 47 |
| Federal Housing Finance Agency | 14 | 14 | 11 |
| Office of Finance | 10 | 10 | 8 |
| Other, net | 21 | 22 | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total other expense | 270 | 258 | 221 |
| **NET INCOME BEFORE ASSESSMENTS** | 979 | 1016 | 1069 |
| Affordable Housing Program assessments | 98 | 102 | 107 |
| **NET INCOME** | $881 | $914 | $962 |

---

The accompanying notes are an integral part of these financial statements.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**FEDERAL HOME LOAN BANK OF DES MOINES** 

**STATEMENTS OF COMPREHENSIVE INCOME** 

**(dollars in millions)**

---

| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| Net income | $881 | $914 | $962 |
| Other comprehensive income (loss) |  |  |  |
| &nbsp;&nbsp;&nbsp;Net change in fair value of available-for-sale securities | 210 | 151 | (64) |
| &nbsp;&nbsp;Postretirement benefits |  |  | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total other comprehensive income (loss) | 210 | 151 | (63) |
| **TOTAL COMPREHENSIVE INCOME (LOSS)** | $1091 | $1065 | $899 |

---

The accompanying notes are an integral part of these financial statements.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**FEDERAL HOME LOAN BANK OF DES MOINES** 

**STATEMENTS OF CAPITAL**

**(dollars and shares in millions)**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | Capital Stock <br>Class B (putable) | Capital Stock <br>Class B (putable) | Retained Earnings | Retained Earnings | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Capital |
| | Shares | Par Value | Unrestricted | Restricted | Total | Accumulated Other Comprehensive Income (Loss) | Total Capital |
| **BALANCE, DECEMBER 31, 2022** | 63 | $6250 | $1915 | $703 | $2618 | $(117) | $8751 |
| Comprehensive income (loss) |  |  | 769 | 193 | 962 | (63) | 899 |
| Proceeds from issuance of capital stock | 111 | 11087 |  |  |  |  | 11087 |
| Repurchases/redemptions of capital stock | (105) | (10460) |  |  |  |  | (10460) |
| Net stock reclassified (to) from mandatorily redeemable capital stock |  | (4) |  |  |  |  | (4) |
| Cash dividends on capital stock |  |  | (442) |  | (442) |  | (442) |
| **BALANCE, DECEMBER 31, 2023** | 69 | $6873 | $2242 | $896 | $3138 | $(180) | $9831 |
| Comprehensive income (loss) |  |  | 732 | 182 | 914 | 151 | 1065 |
| Proceeds from issuance of capital stock | 85 | 8516 |  |  |  |  | 8516 |
| Repurchases/redemptions of capital stock | (94) | (9399) |  |  |  |  | (9399) |
| Net stock reclassified (to) from mandatorily redeemable capital stock |  | (1) |  |  |  |  | (1) |
| Cash dividends on capital stock |  |  | (561) |  | (561) |  | (561) |
| **BALANCE, DECEMBER 31, 2024** | 60 | $5989 | $2413 | $1078 | $3491 | $(29) | $9451 |
| Comprehensive income (loss) |  |  | 705 | 176 | 881 | 210 | 1091 |
| Proceeds from issuance of capital stock | 111 | 11139 |  |  |  |  | 11139 |
| Repurchases/redemptions of capital stock | (105) | (10476) |  |  |  |  | (10476) |
| Net stock reclassified (to) from mandatorily redeemable capital stock | (1) | (143) |  |  |  |  | (143) |
| Cash dividends on capital stock |  |  | (575) |  | (575) |  | (575) |
| **BALANCE, DECEMBER 31, 2025** | 65 | $6509 | $2543 | $1254 | $3797 | $181 | $10487 |

---

The accompanying notes are an integral part of these financial statements.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**FEDERAL HOME LOAN BANK OF DES MOINES**

**STATEMENTS OF CASH FLOWS**

**(dollars in millions)**

---

| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| **OPERATING ACTIVITIES** |  |  |  |
| Net income | $881 | $914 | $962 |
| Adjustments to reconcile net income to net cash provided by (used in) operating activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization/(accretion) | (499) | 344 | 283 |
| &nbsp;&nbsp;&nbsp;Net (gains) losses on trading securities | (97) | (18) | (93) |
| &nbsp;&nbsp;&nbsp;Net (gains) losses on financial instruments held under fair value option | (12) | 31 | 92 |
| &nbsp;&nbsp;&nbsp;Net change in derivatives and hedging activities | (1379) | 684 | (573) |
| &nbsp;&nbsp;&nbsp;Net (gains) losses on extinguishment of debt |  |  | (2) |
| &nbsp;&nbsp;&nbsp;Other adjustments, net | 8 | 22 | 2 |
| &nbsp;&nbsp;&nbsp;Net change in: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | (352) | (101) | (401) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other assets | (7) | 5 | (14) |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable | (128) | (307) | 588 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other liabilities | 29 | 41 | 106 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total adjustments | (2437) | 701 | (12) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by (used in) operating activities | (1556) | 1615 | 950 |
| **INVESTING ACTIVITIES** |  |  |  |
| Net change in: |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest-bearing deposits | 1182 | (165) | (1976) |
| &nbsp;&nbsp;&nbsp;Securities purchased under agreements to resell | (5140) | (550) | 1190 |
| &nbsp;&nbsp;&nbsp;Federal funds sold | (755) | 1945 | 2295 |
| Trading securities |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from sales | 347 | 596 | 389 |
| &nbsp;&nbsp;&nbsp;Proceeds from maturities and paydowns | 518 | 8 | 1094 |
| &nbsp;&nbsp;&nbsp;Purchases | (2351) | (2154) | (1725) |
| Available-for-sale securities |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from maturities and paydowns | 2202 | 2162 | 3417 |
| &nbsp;&nbsp;&nbsp;Purchases | (3436) | (4202) | (10833) |
| Held-to-maturity securities |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from maturities and paydowns | 308 | 85 | 106 |
| Advances |  |  |  |
| &nbsp;&nbsp;&nbsp;Repaid | 685944 | 428461 | 569885 |
| &nbsp;&nbsp;&nbsp;Originated | (695392) | (405970) | (580732) |
| Mortgage loans held for portfolio |  |  |  |
| &nbsp;&nbsp;&nbsp;Principal collected | 1413 | 1088 | 810 |
| &nbsp;&nbsp;&nbsp;Purchased | (4074) | (3032) | (2447) |
| Other investing activities, net | (3) | (7) | (12) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by (used in) investing activities | (19237) | 18265 | (18539) |

---

The accompanying notes are an integral part of these financial statements.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**FEDERAL HOME LOAN BANK OF DES MOINES**

**STATEMENTS OF CASH FLOWS (continued from previous page)**

**(dollars in millions)**

---

| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| **FINANCING ACTIVITIES** |  |  |  |
| Net change in deposits | (189) | 237 | 42 |
| Net proceeds (payments) on derivative contracts with financing elements | 2 | (2) |  |
| Net proceeds from issuance of consolidated obligations |  |  |  |
| &nbsp;&nbsp;&nbsp;Discount notes | 1476108 | 1688542 | 1653546 |
| &nbsp;&nbsp;&nbsp;Bonds | 122893 | 55883 | 139265 |
| Payments for maturing and retiring consolidated obligations |  |  |  |
| &nbsp;&nbsp;&nbsp;Discount notes | (1455687) | (1678826) | (1668653) |
| &nbsp;&nbsp;&nbsp;Bonds | (122297) | (84256) | (106847) |
| Proceeds from issuance of capital stock | 11139 | 8516 | 11087 |
| Payments for repurchases/redemptions of capital stock | (10476) | (9399) | (10460) |
| Payments for repurchases/redemptions of mandatorily redeemable capital stock | (122) | (4) | (7) |
| Cash dividends paid | (575) | (561) | (442) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by (used in) financing activities | 20796 | (19870) | 17531 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net increase (decrease) in cash and due from banks | 3 | 10 | (58) |
| Cash and due from banks at beginning of the period | 41 | 31 | 89 |
| Cash and due from banks at end of the period | $44 | $41 | $31 |
| **SUPPLEMENTAL DISCLOSURES** |  |  |  |
| Cash transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest paid | $8006 | $8278 | $7512 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Affordable Housing Program disbursements, net | 74 | 51 | 49 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Voluntary housing and community investment disbursements | 56 | 58 | 20 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capitalized interest on reverse mortgage investment securities | 288 | 277 | 210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital stock reclassified to (from) mandatorily redeemable capital stock, net | 143 | 1 | 4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Traded but not settled investment security purchases |  | 162 | 691 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Traded but not settled investment security payments/calls |  | 1 | 65 |

---

The accompanying notes are an integral part of these financial statements.

------

<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**FEDERAL HOME LOAN BANK OF DES MOINES** 

**NOTES TO THE FINANCIAL STATEMENTS**

These Notes to the Financial Statements should be read in conjunction with the Statements of Condition as of December 31, 2025 and 2024, and the Statements of Income, Comprehensive Income, Capital, and Cash Flows for the years ended December 31, 2025, 2024, and 2023. Acronyms and terms used throughout these Notes to the Financial Statements are defined in the <u>[Glossary of Terms](#i6940522039644a7690f9aab973fdec20_328)</u>. Unless the context otherwise requires, the term "Bank" refers to the Federal Home Loan Bank of Des Moines or its management.

**Background Information** 

The Bank is a federally chartered corporation that is exempt from all federal, state, and local taxation (except real property taxes and certain employer payroll taxes) and is one of 11 district FHLBanks. The FHLBanks are GSEs and were created under the authority of the FHLBank Act in order to serve the public by enhancing the availability of funds for residential mortgages and targeted community development. The Bank is regulated by the Finance Agency.

The Bank is a cooperative, meaning it is owned by its customers, whom the Bank calls members. As a condition of membership in the Bank, all members must purchase and maintain capital stock to support business activities with the Bank. In return, the Bank provides a readily available source of funding and liquidity to its member institutions and eligible housing associates in Alaska, Hawaii, Idaho, Iowa, Minnesota, Missouri, Montana, North Dakota, Oregon, South Dakota, Utah, Washington, Wyoming, and the U.S. Pacific territories of American Samoa, Guam, and the Commonwealth of the Northern Mariana Islands. Commercial banks, savings institutions, credit unions, insurance companies, and CDFIs may apply for membership. State and local housing associates that meet certain statutory criteria may also borrow from the Bank; while eligible to borrow, housing associates are not members of the Bank and, as such, are not permitted to hold capital stock. All stockholders, including current and former members, may receive dividends on their capital stock investment to the extent declared by the Bank's Board of Directors.

**Note 1 — Summary of Significant Accounting Policies**

BASIS OF PRESENTATION

&nbsp;&nbsp;&nbsp;&nbsp;The Bank prepares its financial statements in accordance with GAAP.

SEGMENT REPORTING

The Bank engages in business activities to provide funding, liquidity, and services to members. The Bank manages these operations as one operating segment.

The Bank's primary business activities are providing advances to members and housing associates and acquiring residential mortgage loans from members. In addition, the Bank maintains a portfolio of investments. The primary source of funding and liquidity is the issuance of consolidated obligations in the capital markets. The Bank is capitalized through the purchase of capital stock by members. The Bank's net income is primarily attributable to the difference between the interest income earned on advances, mortgage loans, and investments, and the interest expense paid on consolidated obligations. The Bank manages risk and monitors financial performance across the entire balance sheet and income statement, including income concentrations with members. Refer to "<u>[Note 14 — Activities with Stockholders](#i6940522039644a7690f9aab973fdec20_238)</u>" for additional information on member concentration. Descriptions of all significant accounting policies related to the Bank's activities are summarized within this footnote.

The Bank's CODM is the President and CEO. The CODM assesses performance and allocation of resources primarily based on net interest income (derived from total assets and total liabilities as reported on the Statements of Condition), and net income (as reported on the Bank's Statements of Income). These measures are used for benchmarking and budget analysis. Other items, including significant expenses, reported to the CODM include those reported on the Bank's Statements of Income, Statements of Condition, and footnotes to the financial statements.

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SIGNIFICANT ACCOUNTING POLICIES

*Use of Estimates*

The preparation of financial statements in accordance with GAAP requires management to make subjective assumptions and estimates that may affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of income and expense. The most significant of these estimates include those used in conjunction with fair value estimates. Actual results could significantly differ from these estimates.

*Fair Value.* The fair value amounts, recorded on the Bank's Statements of Condition and presented in the footnote disclosures, have been determined by the Bank using available market information and management's best judgment of appropriate valuation methods. Although management uses its best judgment in estimating the fair value of financial instruments, there are inherent limitations in any valuation technique. Therefore, these fair values may not be indicative of the amounts that would have been realized in market transactions at the reporting dates. See "<u>[Note 12 — Fair Value](#i6940522039644a7690f9aab973fdec20_229)</u>" for more information.

*Financial Instruments Meeting Netting Requirements*

The Bank has certain financial instruments, including derivative instruments and securities purchased under agreements to resell, that may be presented on a net basis when there is a legal right of offset and all other requirements for netting are met (collectively referred to as the netting requirements). The Bank has elected to offset its derivative instruments, related cash collateral, and associated accrued interest when it has met the netting requirements.

The net exposure for these financial instruments can change on a daily basis and, therefore, there may be a delay between the time this exposure change is identified and additional collateral is requested, and the time when this collateral is received or pledged. Likewise, there may be a delay for excess collateral to be returned. For derivative instruments that meet the requirements for netting, any excess cash collateral received or pledged is recognized as a derivative liability or derivative asset. Additional information regarding these agreements is provided in "<u>[Note 7 — Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205)</u>."

At December 31, 2025 and 2024, the Bank had $17.1 billion and $12.0 billion in securities purchased under agreements to resell. There were no offsetting liabilities related to these securities at December 31, 2025 and 2024.

*Interest-Bearing Deposits, Securities Purchased Under Agreements to Resell, and Federal Funds Sold*

The Bank invests in interest-bearing deposits, securities purchased under agreements to resell, and federal funds sold. Interest-bearing deposits include deposits held with banks or counterparties that do not meet the definition of a security. The Bank treats securities purchased under agreements to resell as short-term collateralized loans. Federal funds sold consist of short-term, unsecured loans generally transacted by counterparties that are considered investment quality by the Bank. All of these investments provide short-term liquidity and are carried at amortized cost. Accrued interest receivable is recorded separately on the Statements of Condition.

These investments are evaluated quarterly for expected credit losses. If applicable, an allowance for credit losses is recorded with a corresponding adjustment to the provision (reversal) for credit losses. The Bank uses the collateral maintenance provision practical expedient for securities purchased under agreements to resell. Consequently, a credit loss would be recognized if there is a collateral shortfall which the Bank does not believe the counterparty will replenish in accordance with its contractual terms. The credit loss would be limited to the difference between the fair value of the collateral and the investment's amortized cost. See "<u>[Note 4 — Investments](#i6940522039644a7690f9aab973fdec20_184)</u>" for details on the allowance methodologies relating to these investments.

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*Debt Securities*

The Bank classifies investment securities as trading, AFS, or HTM at the date of acquisition. Purchases and sales of investment securities are recorded on a trade date basis. The Bank records interest on investment securities to interest income as earned. The Bank generally amortizes/accretes premiums and discounts on AFS and HTM investment securities to income using the contractual level-yield method (level-yield method). In addition, the Bank uses this method to amortize/accrete basis adjustments on discontinued fair value hedging relationships. The level-yield method recognizes the income effects of these adjustments over the contractual life of the securities based on the actual behavior of the underlying assets, including adjustments for actual prepayment activities, and reflects the contractual terms of the securities without regard to changes in estimated prepayments based on assumptions about future borrower behavior. For callable AFS and HTM non-MBS purchased at a premium, the Bank amortizes the premium to the next contractual call date. The Bank computes gains and losses on sales of investment securities using the specific identification method and includes these gains and losses in other income (loss).

*Past Due and Non-Accrual Debt Securities.* A security is considered past due if default of contractual principal or interest exists for a period of 30 days or more. Past due securities may consist of securities still accruing interest or securities on non-accrual status. A security is placed on non-accrual status when full payment of principal and interest is not reasonably assured, regardless of delinquency status, or when principal or interest has been in default for a period of 90 days or more, unless the security is both well-secured and in the process of collection. For those securities placed on non-accrual status, accrued but uncollected interest is reversed against interest income and cash payments are recorded as a reduction of principal. In addition, premiums, discounts, and basis adjustments are not amortized while a security is on non-accrual status. A security on non-accrual status may be restored to accrual status when none of its contractual principal and interest is due and unpaid, and the Bank expects repayment of the remaining contractual principal and interest.

*Trading*. Securities classified as trading are carried at fair value and generally entered into for liquidity purposes. In addition, the Bank classifies certain securities as trading that do not qualify for hedge accounting, primarily in an effort to mitigate the potential income statement volatility that can arise when an economic derivative is adjusted for changes in fair value but the related hedged item is not. The Bank records changes in the fair value of these securities through other income (loss) as "Net gains (losses) on trading securities." The Bank does not participate in speculative trading practices and generally holds these investments until maturity, except to the extent management deems necessary to manage the Bank's liquidity portfolio.

*Available-for-Sale.* Securities that are not classified as trading or HTM are classified as AFS and carried at fair value. The Bank records changes in the fair value of these securities not in qualifying fair value hedging relationships through AOCI as "Net change in fair value of available-for-sale securities." For AFS securities that have been hedged and qualify as a fair value hedge, the Bank records the portion of the change in the fair value of the security related to the risk being hedged in AFS interest income together with the related change in fair value of the derivative, and records the remainder of the change in fair value through AOCI as "Net change in fair value of available-for-sale securities." Accrued interest receivable is recorded separately on the Statements of Condition.

The Bank evaluates its individual AFS securities for impairment quarterly by comparing the security's fair value to its amortized cost. Impairment may exist when the fair value of the investment is less than its amortized cost (i.e., in an unrealized loss position). In assessing whether a credit loss exists on an impaired security, the Bank considers whether there would be a shortfall in receiving all cash flows contractually due. When a shortfall is considered possible, the Bank compares the present value of cash flows to be collected from the security with the amortized cost basis of the security. If the present value of cash flows is less than amortized cost, an allowance for credit losses is recorded with a corresponding adjustment to the provision (reversal) for credit losses. The allowance is limited by the amount of the unrealized loss. The allowance for credit losses excludes uncollectible accrued interest receivable, which is measured separately, if applicable.

If management intends to sell an impaired security classified as AFS, or more likely than not will be required to sell the security before expected recovery of its amortized cost basis, any allowance for credit losses is written off and the amortized cost basis is written down to the security's fair value at the reporting date with any incremental impairment reported in other income (loss). If management does not intend to sell an impaired security classified as AFS and it is not more likely than not that management will be required to sell the debt security, then the credit portion of the difference is recognized as an allowance for credit losses and any remaining difference between the security's fair value and amortized cost is recorded to

"Net change in fair value of available-for-sale securities" within AOCI.

*Held-to-Maturity*. Securities that the Bank has both the ability and intent to hold to maturity are classified as HTM and carried at amortized cost, which represents the amount at which an investment is acquired, adjusted for periodic principal repayments, amortization of premiums, and accretion of discounts. Accrued interest receivable is recorded separately on the Statements of Condition.

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Certain changes in circumstances may cause the Bank to change its intent to hold a security to maturity without calling into question its intent to hold other debt securities to maturity in the future. Thus, the sale or transfer of a HTM security due to certain changes in circumstances, such as evidence of significant deterioration in the issuer's creditworthiness or changes in regulatory requirements, is not considered to be inconsistent with its original classification. Other events that are isolated, non-recurring, and unusual for the Bank that could not have been reasonably anticipated may cause the Bank to sell or transfer an HTM security without necessarily calling into question its intent to hold other debt securities to maturity. In addition, the sale of a debt security that meets either of the following two conditions would not be considered inconsistent with the original classification of that security: (i) the sale occurs near enough to its maturity date (for example, within three months of maturity), or call date if exercise of the call is probable, that interest rate risk is substantially eliminated as a pricing factor and the changes in market interest rates would not have a significant effect on the security's fair value or (ii) the sale occurs after the Bank has already collected a substantial portion (at least 85 percent) of the principal outstanding at acquisition due either to prepayments on the debt security or to scheduled payments on the debt security payable in equal installments (both principal and interest) over its term.

The Bank evaluates its HTM securities for impairment quarterly on a collective, or pooled, basis unless an individual assessment is deemed necessary because the securities do not possess similar risk characteristics. An allowance for credit losses is recorded with a corresponding adjustment to the provision (reversal) for credit losses. The allowance for credit losses excludes uncollectible accrued interest receivable, which is measured separately, if applicable. If management intends to sell an impaired security classified as HTM, any allowance for credit losses is written off and the amortized cost basis is written down to the security's fair value at the reporting date with any incremental impairment reported in other income (loss).

See "<u>[Note 4 — Investments](#i6940522039644a7690f9aab973fdec20_184)</u>" for details on the allowance methodologies relating to AFS and HTM securities.

*Advances*

Advances (secured loans to members, former members, or eligible housing associates) are carried at amortized cost,

which is net of premiums, discounts, fair value hedging adjustments, and prepayment fees on modified advances unless the Bank has elected the fair value option, in which case, the advances are carried at fair value. For advances carried at amortized cost, accrued interest receivable is recorded separately on the Statements of Condition. The Bank records interest on advances to interest income as earned. The Bank amortizes/accretes premiums, discounts, and basis adjustments on discontinued fair value hedging relationships on advances, as well as prepayment fees on modified advances to income using the level-yield method over the contractual life of the advances.

Advances carried at amortized cost are evaluated quarterly for expected credit losses. If deemed necessary, an allowance for credit losses is recorded with a corresponding adjustment to the provision (reversal) for credit losses. The allowance for credit losses excludes uncollectible accrued interest receivable, which is measured separately, if applicable. See "<u>[Note 5 — Advances](#i6940522039644a7690f9aab973fdec20_193)</u>" for details on the allowance methodology relating to advances.

*Past Due and Non-Accrual Advances.* An advance is considered past due for financial reporting purposes if default of contractual principal or interest exists for a period of 30 days or more. Past due advances may consist of advances still accruing interest or advances on non-accrual status. An advance is placed on non-accrual status when full payment of principal and interest is not reasonably assured, regardless of delinquency status, or when principal or interest has been in default for a period of 90 days or more, unless the advance is both well-secured and in the process of collection. In general, the Bank would not expect advances to be placed on non-accrual status as they are required by regulation to be fully secured by underlying collateral.

*Prepayment Fees.* The Bank charges a borrower a prepayment fee when the borrower prepays certain advances before the original maturity. For advances with symmetrical prepayment features, the Bank may charge the borrower a prepayment fee or pay the borrower a prepayment credit, depending on certain circumstances, such as movements in interest rates, when the advance is prepaid. Prepayment fees and credits are recorded net of the hedged item basis adjustments, if applicable, in advance interest income on the Statements of Income.

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*Advance Modifications.* In cases in which the Bank funds a new advance to a borrower concurrently with or within a short period of time before or after the prepayment of an existing advance, the Bank evaluates whether the new advance meets the accounting criteria to qualify as a modification of an existing advance or whether it constitutes a new advance. The Bank compares the present value of cash flows on the new advance to the present value of cash flows remaining on the existing advance. If there is at least a ten percent difference in the present value of the cash flows or if the Bank concludes the difference between the advances is more than minor based on a qualitative assessment of the modifications made to the original contractual terms, then the advance is accounted for as a new advance and all prepayment fees or credits net of basis adjustments are recognized immediately to advance interest income on the Statements of Income. In all other instances, the advance is accounted for as a modification.

When a new advance qualifies as a modification of an existing advance, any prepayment fee, net of the hedged item basis adjustments, as well as any outstanding premiums, discounts, or other adjustments on the prepaid advance, are deferred, recorded in the basis of the modified advance, and amortized over the contractual life of the modified advance using a level-yield methodology to advance interest income.

*Mortgage Loans Held for Portfolio*

The Bank classifies mortgage loans that it has the intent and ability to hold for the foreseeable future, or until maturity or payoff, as held for portfolio. Accordingly, these mortgage loans are reported net of premiums, discounts, price adjustment fees, basis adjustments from mortgage loan purchase commitments, charge-offs, and the allowance for credit losses. The Bank records interest on mortgage loans to interest income as earned. The Bank amortizes/accretes premiums, discounts, price adjustment fees, and basis adjustments on mortgage loan purchase commitments to income using the level-yield method over the contractual life of the mortgage loans. Accrued interest receivable is recorded separately on the Statements of Condition.

The Bank performs a quarterly assessment of its mortgage loans held for portfolio to estimate expected credit losses. If deemed necessary, an allowance for credit losses is recorded with a corresponding adjustment to the provision (reversal) for credit losses.

The Bank measures expected credit losses on mortgage loans on a collective basis, pooling loans with similar risk characteristics. If a mortgage loan no longer shares risk characteristics with other loans, it is removed from the pool and evaluated for expected credit losses on an individual basis. When developing the allowance for credit losses, the Bank measures the estimated loss over the remaining life of a mortgage loan, which also considers how the Bank's credit enhancements mitigate credit losses. The Bank includes estimates of expected recoveries within the allowance for credit losses. The allowance excludes uncollectible accrued interest receivable, as the Bank writes off accrued interest receivable. The Bank does not purchase mortgage loans with credit deterioration at the time of purchase. See "<u>[Note 6 — Mortgage Loans](#i6940522039644a7690f9aab973fdec20_199)</u>" for details on the allowance methodology relating to mortgage loans.

*Other Fees.* The Bank may receive other non-origination fees, such as delivery commitment extension fees, pair-off fees, and price adjustment fees. Delivery commitment extension fees are received when a PFI requests to extend the delivery commitment period beyond the original stated expiration. These fees compensate the Bank for lost interest as a result of late funding and are recorded in non-interest income as received. Pair-off fees represent a make-whole provision; they are received when the amount funded is less than a specific percentage of the delivery commitment amount and are recorded in non-interest income. Price adjustment fees are received when the amount funded is greater than a specified percentage of the delivery commitment amount; they represent purchase price adjustments to the related loans acquired and are recorded as a part of the carrying value of the loans.

*Past Due and Non-Accrual Loans.* A mortgage loan is considered past due if the borrower has failed to make contractual principal and/or interest payments for a period of 30 days or more. The Bank places a conventional mortgage loan on non-accrual status if it is determined that either the collection of interest or principal is doubtful or interest or principal is 90 days or more past due. The Bank does not place a government-insured mortgage loan on non-accrual status due to the U.S. Government guarantee or insurance on the loan and contractual obligation of the loan servicer to repurchase the loan when certain criteria are met. For those mortgage loans placed on non-accrual status, accrued but uncollected interest is reversed against interest income and cash payments received are recorded as a reduction of principal. In addition, premiums, discounts, price adjustment fees, and basis adjustments from mortgage loan purchase commitments are not amortized while a loan is on non-accrual status. A loan on non-accrual status may be restored to accrual status when none of its contractual principal and interest is due and unpaid and the Bank expects repayment of the remaining contractual principal and interest.

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*Modifications*. Generally, the Bank only grants mortgage loan modifications to borrowers experiencing financial difficulty. If the terms of the modified loan are at least as favorable to the lender as the terms offered to borrowers with similar collection risks for comparable loans and the modification to the terms of the loan is more than minor, the loan meets the accounting criteria for a new loan. Generally, a modification would not result in a new loan because the modified terms are not as favorable to the lender as terms for comparable loans that would be offered to similar borrowers. The Bank does not consider changes to the terms of government-insured mortgage loans to be modifications due to the U.S. Government guarantee or insurance on the loan and contractual obligation of the loan servicer to repurchase the loan when certain criteria are met. The Bank places all modified loans on non-accrual status at the time of modification; however, these loans may be subsequently restored to accrual status if they meet the criteria noted in the non-accrual section above.

*Individually Evaluated Loans.* The Bank individually evaluates all collateral-dependent loans for expected credit losses. Collateral-dependent loans are loans in which repayment is expected to be provided solely by the sale of the underlying collateral. The Bank's collateral-dependent loans include loans in process of foreclosure, loans 180 days or more past due, bankruptcy loans 60 days or more past due, and modified loans on non-accrual status. The Bank measures these individually evaluated loans for expected credit loss based on the estimated fair value of the underlying property, less estimated selling costs and expected proceeds from PMI. All collateral-dependent loans are initially placed on non-accrual status; however, they may be subsequently restored to accrual status if they meet the criteria noted in the non-accrual section above.

*Charge-Off Policy*. A charge-off is recorded if it is estimated that the amortized cost of a loan will not be recovered. The Bank evaluates whether to record a charge-off on a conventional mortgage loan upon the occurrence of a confirming event. Confirming events include but are not limited to, the occurrence of foreclosure or when a loan is deemed collateral-dependent. The Bank charges-off the portion of the outstanding conventional mortgage loan balance in excess of the fair value of the underlying collateral, which is determined using property values, less estimated selling costs and expected proceeds from PMI.

*Derivatives*

All derivatives are recognized on the Statements of Condition at their fair values and reported as either derivative assets or derivative liabilities, net of cash collateral and accrued interest received from or pledged to clearing agents and/or counterparties. The fair values of derivatives are netted by clearing agent and/or counterparty when the netting requirements have been met. If these netted amounts result in a receivable to the Bank, they are classified as a derivative asset and, if classified as a payable to the clearing agent or counterparty, they are classified as a derivative liability. Cash flows associated with a derivative are reflected as cash flows from operating activities on the Statements of Cash Flows unless the derivative meets the criteria to be a financing derivative.

The Bank transacts most of its derivative transactions with large banks and major broker-dealers. Over-the-counter derivative transactions may be either executed directly with a counterparty, referred to as uncleared derivatives, or cleared through a clearing agent with a clearinghouse, referred to as cleared derivatives. Once a derivative transaction has been accepted for clearing by a clearinghouse, the derivative transaction is novated and the executing counterparty is replaced with the clearinghouse. The Bank is not a derivative dealer and does not trade derivatives for short-term profit.

For uncleared derivatives, two-way initial margin requirements are imposed, which are required to be satisfied with securities collateral. In addition, uncleared derivative agreements are fully collateralized with a zero unsecured threshold, which can be satisfied with cash or securities collateral, in accordance with variation margin requirements issued by the U.S. federal bank regulatory agencies and the CFTC.

For cleared derivatives, the clearinghouse is the Bank's counterparty. The Bank utilizes two clearinghouses, CME Clearing and LCH Ltd., for all cleared derivative transactions. CME Clearing and LCH Ltd. notify the clearing agent of the required initial margin and daily variation margin payments, and the clearing agent in turn notifies the Bank. Each clearinghouse determines initial margin requirements, which are considered collateral and can be satisfied with cash or securities. Variation margin requirements with each clearinghouse are based on changes in the fair value of cleared derivatives and are legally characterized as daily settlement payments, which are a component of the derivative fair value, rather than cash collateral.

*Derivative Designations*. Derivative instruments are designated by the Bank as:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a fair value hedge of an associated financial instrument or firm commitment (fair value hedge); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an economic hedge to manage certain defined risks on the Bank's Statements of Condition (economic hedge).

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*Accounting for Fair Value Hedges*. If hedging relationships meet certain criteria, including, but not limited to, formal documentation of the fair value hedging relationship and an expectation to be highly effective, they qualify for fair value hedge accounting. At the inception of each fair value hedge transaction, the Bank formally documents the hedge relationship and its risk management objective and strategy for undertaking the hedge, including identification of the hedging instrument, the hedged item, the nature of the risk being hedged, and how the hedging instrument's effectiveness in offsetting the exposure to changes in the hedged item's fair value attributable to the hedged risk will be assessed. This process includes linking all derivatives that are designated as fair value hedges to assets and liabilities on the Statements of Condition and firm commitments.

Changes in the fair value of a derivative that is designated and qualifies as a fair value hedge, along with changes in the fair value of the hedged asset or liability (or firm commitment) that are attributable to the hedged risk, are recorded in net interest income in the same line as the earnings effect of the hedged item.

Two approaches to fair value hedge accounting include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Long-haul hedge accounting*. The application of long-haul hedge accounting requires the Bank to formally assess (both at the hedge's inception and at least quarterly) whether the derivatives that are used in hedging transactions have been highly effective in offsetting changes in the fair value of hedged items due to benchmark interest rate changes and whether those derivatives are expected to remain highly effective in future periods. The Bank uses regression analyses to assess the effectiveness of its long-haul hedges. The Bank employs regression-based testing at inception and on an on-going basis based on valuations derived from historical and current market data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Short-cut hedge accounting*. Transactions that meet certain criteria qualify for short-cut hedge accounting in which an assumption can be made that the change in fair value of a hedged item due to changes in the hedged risk, exactly offsets the change in fair value of the related derivative. Under the short-cut method, the entire change in fair value of the interest rate swap is considered to be highly effective at achieving offsetting changes in fair value of the hedged asset or liability. If documented at the time of hedge designation, a derivative relationship no longer qualifying for short-cut hedge accounting can fall back to the long-haul accounting method.

Derivatives are typically executed at the same time as the hedged item, and the Bank designates the hedged item in a fair value hedging relationship at the trade date. In many hedging relationships, the Bank may designate the fair value hedging relationship upon its commitment to disburse an advance, or trade a consolidated obligation in which settlement occurs within the shortest period of time possible for the type of instrument based on market settlement conventions. The Bank then records the changes in fair value of the derivative and the hedged item beginning on the trade date.

*Accounting for Economic Hedges*. An economic hedge is defined as a derivative hedging specific or non-specific underlying assets, liabilities, or firm commitments that does not qualify or was not designated for fair value hedge accounting, but is an acceptable hedging strategy under the Bank's risk management program. Changes in the fair value of derivatives that are designated as economic hedges are recorded in other income (loss) as "Net gains (losses) on derivatives" with no offsetting fair value adjustments for the underlying assets, liabilities, or firm commitments, unless changes in the fair value of the those items are normally marked to fair value through earnings (e.g., trading securities and fair value option instruments).

*Accrued Interest Receivables and Payables*. The net settlements of interest receivables and payables related to derivatives designated as fair value hedges are recognized as adjustments to the interest income or interest expense of the designated hedged item. The net settlements of interest receivables and payables related to derivatives designated as economic hedges are recognized in other income (loss) as "Net gains (losses) on derivatives."

*Discontinuance of Hedge Accounting.* The Bank discontinues fair value hedge accounting prospectively when either (i) it determines that the derivative is no longer highly effective in offsetting changes in the fair value of a hedged item due to changes in the benchmark interest rate, (ii) the derivative and/or the hedged item expires or is sold, terminated, or exercised, or (iii) management determines that designating the derivative as a hedging instrument is no longer appropriate.

When fair value hedge accounting is discontinued, the Bank either terminates the derivative or continues to carry the derivative on the Statements of Condition at its fair value. For any remaining hedged item, the Bank ceases to adjust the hedged item for changes in fair value and amortizes the cumulative basis adjustment on the hedged item into earnings over the remaining contractual life of the hedged item using the level-yield method.

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*Embedded Derivatives.* The Bank may issue debt, make advances, or purchase financial instruments in which a derivative instrument is embedded. Upon execution of these transactions, the Bank assesses whether the economic characteristics of the embedded derivative are clearly and closely related to the economic characteristics of the remaining component of the debt, advance, or purchased financial instrument (the host contract) and whether a separate, non-embedded instrument with the same terms as the embedded instrument would meet the definition of a derivative instrument. If the Bank determines that the embedded derivative has economic characteristics that are not clearly and closely related to the economic characteristics of the host contract and a separate, stand-alone instrument with the same terms would qualify as a derivative instrument, the embedded derivative is separated from the host contract, carried at fair value, and designated as an economic derivative instrument. However, if the Bank elects to carry the entire contract (the host contract and the embedded derivative) at fair value on the Statements of Condition, changes in fair value of the entire contract will be reported in current period earnings.

*Consolidated Obligations*

The Bank reports consolidated obligations at amortized cost, which is net of premiums, discounts, concessions, and fair value hedging adjustments unless the Bank has elected the fair value option, in which case the consolidated obligations are carried at fair value. The Bank records interest on consolidated obligations bonds to interest expense as incurred. The Bank amortizes/accretes premiums, discounts, concessions, and basis adjustments on discontinued fair value hedging relationships on consolidated obligations to expense using the level-yield method over the contractual life of the consolidated obligations.

*Concessions.* The Bank pays concessions to dealers in connection with the issuance of certain consolidated obligations. The Office of Finance prorates the amount of the concession to each FHLBank, based upon the percentage of the debt issued that is attributed to that FHLBank. Concessions paid on consolidated obligations designated under the fair value option are expensed as incurred and recorded in other expense. Concessions paid on consolidated obligations not designated under the fair value option are deferred and amortized over the contractual life of the consolidated obligations using the level-yield method. Unamortized concessions are included as a direct deduction from the carrying amount of "Consolidated obligation discount notes" or "Consolidated obligation bonds" on the Statements of Condition and the amortization of those concessions is included in consolidated obligation interest expense.

*Off-Balance Sheet Credit Exposures*

The Bank evaluates its off-balance sheet credit exposures on a quarterly basis for expected credit losses. If deemed necessary, an allowance for expected credit losses on these off-balance sheet exposures is recorded in "Other liabilities" on the Bank's Statements of Condition, with a corresponding adjustment to the provision (reversal) for credit losses. See "<u>[Note 13 — Commitments and Contingencies](#i6940522039644a7690f9aab973fdec20_232)</u>" for additional information.

*Mandatorily Redeemable Capital Stock*

The Bank reclassifies capital stock subject to redemption from equity to MRCS at the time shares meet the definition of a mandatorily redeemable financial instrument. This occurs after a member provides written notice of redemption, gives notice of intention to withdraw from membership, becomes ineligible for continuing membership, or attains non-member status by merger or consolidation, charter termination, or other involuntary termination from membership. Shares meeting this definition are reclassified to a liability at fair value. Dividends on MRCS are classified as interest expense on the Statements of Income. The repurchase or redemption of MRCS is transacted at par value and is reflected as a cash outflow in the financing activities section of the Statements of Cash Flows. If a member cancels its written notice of redemption or notice of withdrawal, the Bank will reclassify MRCS from a liability to equity. After the reclassification, dividends on the capital stock will no longer be classified as interest expense.

*Voluntary Community and Housing Contributions*

The Bank's voluntary contributions to AHP and other community and housing initiatives are recorded in a separate line within other expense on the Statements of Income.

A voluntary AHP contribution is expensed when the Bank's Board of Directors approves the irrevocable terms of the award, and the likelihood of award is probable and the amount is estimable. The amount is subject to the same regulatory requirements as AHP assessments.

Other voluntary grants and contributions are recognized as an expense in the period in which the grant or contribution is considered an unconditional promise to give.

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The Habitat for Humanity<sup>®</sup> Advance Rate Discount is a subsidized advance program that issues advances with an interest rate below the customary interest rate for non-subsidized advances with similar terms. At the time of disbursement, the Bank determines the present value of the advance using the appropriate imputed market interest rate as the discount rate. The Bank records a discount on the advance with a corresponding voluntary community and housing expense related to the inherent contribution made at the time the Bank issues the advance. The discount on a subsidized advance is accreted to interest income using the contractual level-yield method over the life of the advance.

The Mortgage Rate Relief program provides grants to buy down the interest rates of loans on behalf of borrowers. The below market rate loan purchased by the Bank is recorded at fair value, which is net of discounts, on the Statements of Condition. The grant is considered an inherent contribution and is recognized as an expense at the time of the loan funding.

Voluntary contributions (non-AHP) that have been expensed but not yet disbursed are recorded in "Other liabilities" on the Bank's Statements of Condition. The Bank had an outstanding liability of $2 million at December 31, 2025, and no outstanding liability at December 31, 2024.

*Restricted Retained Earnings* 

The Bank entered into a JCE Agreement with all of the other FHLBanks in 2011. The JCE Agreement, as amended, is intended to enhance the capital position of the FHLBanks over time. Under the JCE Agreement, each FHLBank is required to allocate 20 percent of its quarterly net income to a restricted retained earnings account until the balance of that account, calculated as of the last day of each calendar quarter, equals at least one percent of its average balance of outstanding consolidated obligations for the calendar quarter. The restricted retained earnings are not available to pay dividends and are presented separately on the Statements of Condition.

*Affordable Housing Program Assessments*

Each FHLBank recognizes AHP assessment expense equal to the greater of 10 percent of its annual income subject to assessment, or its prorated portion of the sum required to ensure the aggregate contribution by the FHLBanks is no less than $100 million for each year. For purposes of the statutory AHP assessment, income subject to assessment is defined as net income before AHP assessments, plus interest expense related to MRCS. The Bank accrues the AHP assessment monthly based on its income subject to assessment and reduces the AHP liability as program funds are distributed.

**Note 2 — Recently Adopted and Issued Accounting Guidance**

*Interim Reporting - Narrow-Scope Improvements (ASU 2025-11)*

In December 2025, the FASB issued guidance to provide clarity on the interim reporting requirements, without expanding or reducing current requirements. This guidance becomes effective for the Bank for the interim periods beginning on January 1, 2028. Early adoption of this guidance is permitted. The adoption of this guidance is not expected to have any effect on the Bank's financial condition, results of operations, cash flows, or disclosures.

*Hedge Accounting Improvements (ASU 2025-09)* 

In November 2025, the FASB issued guidance addressing incremental hedge accounting issues, including the elimination of the net written option test in certain instances. This guidance becomes effective for the Bank for the annual and interim periods beginning on January 1, 2027. Early adoption of this guidance is permitted. The adoption of this guidance is not expected to have any effect on the Bank's financial condition, results of operations, cash flows, or disclosures.

*Purchased Loans (ASU 2025-08)*

In November 2025, the FASB issued guidance updating the accounting for acquired financial assets, requiring certain purchased loans to be accounted for at their purchase price plus an allowance. This guidance becomes effective for the Bank for the annual and interim periods beginning on January 1, 2027. Early adoption of this guidance is permitted. The Bank is in process of evaluating this guidance; the effect on the Bank's financial condition, results of operations, cash flows, or disclosures has not been determined.

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*Targeted Improvements to the Accounting for Internal-Use Software (ASU 2025-06)*

In September 2025, the FASB issued guidance updating the accounting for internal-use software costs, removing all references to development stages and clarifying when capitalization may begin. This guidance becomes effective for the Bank for the interim and annual periods beginning on January 1, 2028. Early adoption of this guidance is permitted. The Bank is in process of evaluating this guidance; the effect on the Bank's financial condition, results of operations, cash flows, or disclosures has not been determined.

*Disaggregation of Income Statement Expenses (ASU 2024-03)*

In November 2024, the FASB issued guidance requiring disaggregated disclosure of income statement expenses. This guidance becomes effective for the Bank for the annual period ended December 31, 2027, and the interim periods thereafter. While early adoption of this guidance is permitted, the Bank does not intend to early adopt. The adoption of this guidance is not expected to have any effect on the Bank's financial condition, results of operations, cash flows, or disclosures due to the existing level of disaggregation.

**Note 3 — Cash and Due from Banks**

&nbsp;&nbsp;&nbsp;&nbsp;Cash and due from banks includes cash on hand, cash items in the process of collection, compensating balances, and amounts due from the Federal Reserve Bank.

COMPENSATING BALANCES

The Bank maintains collected cash balances with commercial banks in return for certain services. These arrangements contain no legal restrictions on the withdrawal of funds. Average collected cash balances were $28 million and $18 million for the years ended December 31, 2025 and 2024.

**Note 4 — Investments**

The Bank makes short-term investments in interest-bearing deposits, securities purchased under agreements to resell, and federal funds sold, and makes other investments in debt securities, which are classified as either trading, AFS, or HTM.

INTEREST-BEARING DEPOSITS, SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL, AND FEDERAL FUNDS SOLD

The Bank invests in interest-bearing deposits, securities purchased under agreements to resell, and federal funds sold to provide short-term liquidity. These investments are generally transacted with counterparties that have received a credit rating of triple-B or greater (investment grade) by an NRSRO. At December 31, 2025 and 2024, none of these investments were with counterparties rated below triple-B; however, as of December 31, 2025 and 2024, approximately 40 percent and 34 percent were secured securities purchased under agreements to resell with unrated counterparties.

Federal funds sold are unsecured loans that are generally transacted on an overnight term. Finance Agency regulations limit the amount of unsecured credit the Bank may extend to a counterparty. At December 31, 2025 and 2024, no allowance for credit losses was recorded for interest-bearing deposits and federal funds sold, as all assets were repaid or expected to be repaid according to their contractual terms. The carrying values of interest-bearing deposits and federal funds sold exclude accrued interest receivable of $15 million and $17 million at December 31, 2025 and 2024.

Securities purchased under agreements to resell are secured, short-term, and are structured such that they are evaluated regularly to determine if the market value of the underlying securities decreases below the market value required as collateral (i.e., subject to collateral maintenance provisions). If so, the counterparty must place an equivalent amount of additional securities as collateral or remit an equivalent amount of cash, generally by the next business day. Based upon the collateral held as security and collateral maintenance provisions with its counterparties, the Bank determined that no allowance for credit losses was needed for its securities purchased under agreements to resell at December 31, 2025 and 2024. The carrying value of securities purchased under agreements to resell excludes accrued interest receivable of $2 million and $1 million at December 31, 2025 and 2024.

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DEBT SECURITIES

The Bank invests in debt securities, which are classified as either trading, AFS, or HTM. The Bank is prohibited by Finance Agency regulations from purchasing certain higher-risk securities, such as equity securities and debt instruments that are not investment quality. A security is considered to be investment quality if it has adequate financial backing so that full and timely payment of principal and interest is expected and there is minimal risk that the timely payment of principal and interest would not occur because of adverse changes in economic and financial conditions during the projected life of the security. Exceptions are allowed for certain investments targeted at low-income persons or communities, and instruments that experienced credit deterioration after their purchase by the Bank.

*Trading Securities* 

Trading securities by major security type were as follows (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Non-mortgage-backed securities |  |  |
| &nbsp;&nbsp;U.S. Treasury obligations<sup>1</sup> | $6104 | $4508 |
| &nbsp;&nbsp;Other U.S. obligations<sup>1</sup> | 57 | 59 |
| &nbsp;&nbsp;&nbsp;GSE and Tennessee Valley Authority obligations | 48 | 47 |
| &nbsp;&nbsp;Other<sup>2</sup> | 94 | 106 |
| Total fair value | $6303 | $4720 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents investment securities backed by the full faith and credit of the U.S. Government.

2&nbsp;&nbsp;&nbsp;&nbsp;Consists of taxable municipal bonds.

<u>Net Gains (Losses) on Trading Securities</u>

The following table summarizes the components of "Net gains (losses) on trading securities" as presented on the Statements of Income (dollars in millions):

---

| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| Net unrealized gains (losses) on trading securities held at period-end | $82 | $18 | $67 |
| Net gains (losses) on trading securities no longer held at period-end | 15 |  | 26 |
| Net gains (losses) on trading securities | $97 | $18 | $93 |

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*AFS Securities* 

AFS securities by major security type were as follows (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Amortized<br>Cost<sup>1</sup> | Gross<br>Unrealized<br>Gains | Gross<br>Unrealized<br>Losses | <br>Fair <br>Value |
| Non-mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;Other U.S. obligations<sup>2</sup> | $14 | $— | $— | $14 |
| &nbsp;&nbsp;&nbsp;GSE and Tennessee Valley Authority obligations | 280 | 30 |  | 310 |
| &nbsp;&nbsp;&nbsp;State or local housing agency obligations | 369 | 2 | (1) | 370 |
| &nbsp;&nbsp;Other<sup>3</sup> | 18 | 1 |  | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total non-mortgage-backed securities | 681 | 33 | (1) | 713 |
| Mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;U.S. obligations single-family<sup>2</sup> | 5683 | 25 | (1) | 5707 |
| &nbsp;&nbsp;&nbsp;GSE single-family | 217 | 1 | (1) | 217 |
| &nbsp;&nbsp;&nbsp;GSE multifamily | 20755 | 152 | (25) | 20882 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total mortgage-backed securities | 26655 | 178 | (27) | 26806 |
| Total | $27336 | $211 | $(28) | $27519 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Amortized<br>Cost<sup>1</sup> | Gross<br>Unrealized<br>Gains | Gross<br>Unrealized<br>Losses | <br>Fair <br>Value |
| Non-mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;Other U.S. obligations<sup>2</sup> | $102 | $— | $— | $102 |
| &nbsp;&nbsp;&nbsp;GSE and Tennessee Valley Authority obligations | 285 | 24 |  | 309 |
| &nbsp;&nbsp;&nbsp;State or local housing agency obligations | 504 | 1 | (6) | 499 |
| &nbsp;&nbsp;Other<sup>3</sup> | 41 | 1 |  | 42 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total non-mortgage-backed securities | 932 | 26 | (6) | 952 |
| Mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;U.S. obligations single-family<sup>2</sup>  | 5192 | 13 | (5) | 5200 |
| &nbsp;&nbsp;&nbsp;GSE single-family | 197 |  | (2) | 195 |
| &nbsp;&nbsp;&nbsp;GSE multifamily | 19037 | 45 | (98) | 18984 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total mortgage-backed securities | 24426 | 58 | (105) | 24379 |
| Total | $25358 | $84 | $(111) | $25331 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Amortized cost includes adjustments made to the cost basis of an investment for accretion, amortization, and/or fair value hedge accounting adjustments, and excludes accrued interest receivable of $89 million and $86 million at December 31, 2025 and 2024.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents investment securities backed by the full faith and credit of the U.S. Government.

3&nbsp;&nbsp;&nbsp;&nbsp;Consists of taxable municipal bonds.

The Bank had no sales of AFS securities during the years ended December 31, 2025, 2024, and 2023.

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<u>Unrealized Losses</u>

The following tables summarize AFS securities with gross unrealized losses by major security type and length of time that individual securities have been in a continuous unrealized loss position (dollars in millions). In cases where the gross unrealized losses for an investment category are less than $1 million, the losses are not reported.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Less than 12 Months | Less than 12 Months | 12 Months or More | 12 Months or More | Total | Total |
| | Fair<br>Value | Gross Unrealized<br>Losses | Fair<br>Value | Gross Unrealized<br>Losses | Fair<br>Value | Gross Unrealized<br>Losses |
| Non-mortgage-backed securities |  |  |  |  |  |  |
| &nbsp;&nbsp;Other U.S. obligations<sup>1</sup> | $7 | $— | $3 | $— | $10 | $— |
| &nbsp;&nbsp;&nbsp;State or local housing agency obligations | 82 | (1) | 123 |  | 205 | (1) |
| Total non-mortgage-backed securities | 89 | (1) | 126 |  | 215 | (1) |
| Mortgage-backed securities |  |  |  |  |  |  |
| &nbsp;&nbsp;U.S. obligations single-family<sup>1</sup> | 181 |  | 488 | (1) | 669 | (1) |
| &nbsp;&nbsp;&nbsp;GSE single-family |  |  | 71 | (1) | 71 | (1) |
| &nbsp;&nbsp;&nbsp;GSE multifamily | 216 |  | 3831 | (25) | 4047 | (25) |
| Total mortgage-backed securities | 397 |  | 4390 | (27) | 4787 | (27) |
| Total | $486 | $(1) | $4516 | $(27) | $5002 | $(28) |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Less than 12 Months | Less than 12 Months | 12 Months or More | 12 Months or More | Total | Total |
| | Fair<br>Value | Gross Unrealized<br>Losses | Fair<br>Value | Gross Unrealized<br>Losses | Fair<br>Value | Gross Unrealized<br>Losses |
| Non-mortgage-backed securities |  |  |  |  |  |  |
| &nbsp;&nbsp;Other U.S. obligations<sup>1</sup> | $— | $— | $21 | $— | $21 | $— |
| &nbsp;&nbsp;&nbsp;State or local housing agency obligations | 108 | (1) | 347 | (5) | 455 | (6) |
| Total non-mortgage-backed securities | 108 | (1) | 368 | (5) | 476 | (6) |
| Mortgage-backed securities |  |  |  |  |  |  |
| &nbsp;&nbsp;U.S. obligations single-family<sup>1</sup> | 995 | (4) | 808 | (1) | 1803 | (5) |
| &nbsp;&nbsp;&nbsp;GSE single-family | 45 |  | 85 | (2) | 130 | (2) |
| &nbsp;&nbsp;&nbsp;GSE multifamily | 3325 | (10) | 7587 | (88) | 10912 | (98) |
| Total mortgage-backed securities | 4365 | (14) | 8480 | (91) | 12845 | (105) |
| Total | $4473 | $(15) | $8848 | $(96) | $13321 | $(111) |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents investment securities backed by the full faith and credit of the U.S. Government.

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<u>Contractual Maturity</u>

The following table summarizes AFS securities by contractual maturity. Expected maturities of some securities may differ from contractual maturities, as borrowers may have the right to call or prepay obligations with or without call or prepayment fees (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| Year of Contractual Maturity | Amortized<br>Cost | Fair <br>Value | Amortized<br>Cost | Fair <br>Value |
| Non-mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Due in one year or less | $11 | $11 | $88 | $88 |
| &nbsp;&nbsp;&nbsp;Due after one year through five years | 47 | 49 | 234 | 236 |
| &nbsp;&nbsp;&nbsp;Due after five years through ten years | 224 | 227 | 212 | 210 |
| &nbsp;&nbsp;&nbsp;Due after ten years | 399 | 426 | 398 | 418 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total non-mortgage-backed securities | 681 | 713 | 932 | 952 |
| Mortgage-backed securities | 26655 | 26806 | 24426 | 24379 |
| Total | $27336 | $27519 | $25358 | $25331 |

---

*HTM Securities* 

HTM securities by major security type were as follows (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Amortized<br>Cost<sup>1</sup> | Gross<br>Unrecognized<br>Gains | Gross<br>Unrecognized<br>Losses | Fair <br>Value |
| Non-mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;GSE and Tennessee Valley Authority obligations | $124 | $8 | $— | $132 |
| &nbsp;&nbsp;&nbsp;State or local housing agency obligations | 21 | 1 |  | 22 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total non-mortgage-backed securities | 145 | 9 |  | 154 |
| Mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;U.S. obligations single-family<sup>2</sup> | 1 |  |  | 1 |
| &nbsp;&nbsp;&nbsp;GSE single-family | 299 |  | (4) | 295 |
| &nbsp;&nbsp;&nbsp;Private-label | 2 |  |  | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total mortgage-backed securities | 302 |  | (4) | 298 |
| Total | $447 | $9 | $(4) | $452 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Amortized<br>Cost<sup>1</sup> | Gross<br>Unrecognized<br>Gains | Gross<br>Unrecognized<br>Losses | Fair <br>Value |
| Non-mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;GSE and Tennessee Valley Authority obligations | $358 | $6 | $(2) | $362 |
| &nbsp;&nbsp;&nbsp;State or local housing agency obligations | 29 |  |  | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total non-mortgage-backed securities | 387 | 6 | (2) | 391 |
| Mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;U.S. obligations single-family<sup>2</sup> | 2 |  |  | 2 |
| &nbsp;&nbsp;&nbsp;GSE single-family | 369 |  | (7) | 362 |
| &nbsp;&nbsp;&nbsp;Private-label | 2 |  |  | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total mortgage-backed securities | 373 |  | (7) | 366 |
| Total | $760 | $6 | $(9) | $757 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Amortized cost includes adjustments made to the cost basis of an investment for accretion or amortization and excludes accrued interest receivable of $2 million and $5 million at both December 31, 2025 and 2024.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents investment securities backed by the full faith and credit of the U.S. Government.

The Bank had no sales of HTM securities during the years ended December 31, 2025, 2024, and 2023.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

<u>Contractual Maturity</u>

The following table summarizes HTM securities by contractual maturity. Expected maturities of some securities may differ from contractual maturities, as borrowers may have the right to call or prepay obligations with or without call or prepayment fees (dollars in millions):

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| Year of Contractual Maturity | Amortized<br>Cost | Fair <br>Value | Amortized<br>Cost | Fair <br>Value |
| Non-mortgage-backed securities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Due in one year or less | $3 | $3 | $233 | $233 |
| &nbsp;&nbsp;&nbsp;Due after one year through five years | 27 | 28 | 12 | 12 |
| &nbsp;&nbsp;&nbsp;Due after five years through ten years | 69 | 74 | 72 | 73 |
| &nbsp;&nbsp;&nbsp;Due after ten years | 46 | 49 | 70 | 73 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total non-mortgage-backed securities | 145 | 154 | 387 | 391 |
| Mortgage-backed securities | 302 | 298 | 373 | 366 |
| Total | $447 | $452 | $760 | $757 |

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ALLOWANCE FOR CREDIT LOSSES ON AFS AND HTM SECURITIES

The Bank evaluates AFS and HTM investment securities for credit losses on a quarterly basis. The Bank's AFS and HTM securities may include, but are not limited to, certificates of deposit, commercial paper, U.S. obligations, GSE and TVA obligations, state or local housing agency obligations, taxable municipal bonds, and MBS. The Bank only purchases securities considered investment quality. At both December 31, 2025 and 2024, over 99 percent of the Bank's AFS and HTM securities, based on amortized cost, were rated single-A or above by an NRSRO, based on the lowest long-term credit rating for each security.

The Bank evaluates its individual AFS securities for impairment by comparing the security's fair value to its amortized cost. Impairment may exist when the fair value of the investment is less than its amortized cost (i.e., in an unrealized loss position). At December 31, 2025 and 2024, certain AFS securities held by the Bank were in an unrealized loss position. These losses are considered temporary as the Bank expects to recover the entire amortized cost basis on these AFS investment securities and neither intends to sell these securities nor considers it more likely than not that it will be required to sell these securities before its anticipated recovery of each security's remaining amortized cost basis. In addition, substantially all of these securities are high-quality GSE securities or carry an explicit government guarantee. In the case of GSE securities, they are purchased under an assumption that the issuers' obligation to pay principal and interest on those securities will be honored, taking into account their status as GSEs. As a result, no allowance for credit losses was recorded on these AFS securities at December 31, 2025 and 2024.

The Bank evaluates its HTM securities for impairment on a collective, or pooled, basis unless an individual assessment is deemed necessary because the securities do not possess similar risk characteristics. At December 31, 2025 and 2024, the Bank had no allowance for credit losses recorded on its HTM securities because the securities: (i) were highly-rated, (ii) had not experienced, nor did the Bank expect, any material payment defaults on the instruments, and (iii) in the case of U.S. obligations and GSE and TVA obligations, carry an explicit government guarantee, and (iv) in the case of GSE securities, they are purchased under an assumption that the issuers' obligation to pay principal and interest on those securities will be honored, taking into account their status as GSEs.

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**Note 5 — Advances** 

The Bank holds a wide range of fixed and variable rate advance products with different maturities, interest rates, payment characteristics, and optionality. Fixed rate advances generally have maturities ranging from overnight to 30 years. Variable rate advances generally have maturities ranging from one month to ten years, where the interest rates reset periodically to a specified interest rate index such as SOFR or consolidated obligation yields.

REDEMPTION TERM

The following table summarizes the Bank's advances outstanding by redemption term (dollars in millions):

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| Redemption Term | Amount<sup>1</sup> | Weighted<br>Average<br>Interest<br>Rate | Amount<sup>1</sup> | Weighted<br>Average<br>Interest<br>Rate |
| Overdrawn demand deposit accounts | $— | —% | $1 | 6.12% |
| Due in one year or less | 53895 | 3.87 | 45738 | 4.44 |
| Due after one year through two years | 14770 | 3.84 | 16105 | 3.84 |
| Due after two years through three years | 15574 | 4.12 | 12751 | 4.19 |
| Due after three years through four years | 11013 | 3.93 | 13328 | 4.30 |
| Due after four years through five years | 9511 | 4.12 | 7787 | 4.33 |
| Thereafter | 5415 | 4.27 | 5020 | 4.25 |
| Total par value | 110178 | 3.95% | 100730 | 4.27% |
| Premiums | 2 |  | 3 |  |
| Discounts | (22) |  | (21) |  |
| Fair value hedging adjustments | 72 |  | (761) |  |
| Total | $110230 |  | $99951 |  |

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1&nbsp;&nbsp;&nbsp;&nbsp;Excludes accrued interest receivable of $192 million and $180 million at December 31, 2025 and 2024.

The Bank offers advances to members and eligible housing associates that may be prepaid on predetermined dates (call dates) prior to maturity without incurring prepayment fees (callable advances). Other advances may require a prepayment fee or credit that makes the Bank financially indifferent to the prepayment of the advance. At December 31, 2025 and 2024, the Bank had callable advances outstanding totaling $10.6 billion and $10.4 billion.

The following table summarizes advances by year of redemption term or next call date for callable advances (dollars in millions):

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| | | |
|:---|:---|:---|
| | Redemption Term<br>or Next Call Date | Redemption Term<br>or Next Call Date |
| | December 31,<br>2025 | December 31,<br>2024 |
| Overdrawn demand deposit accounts | $— | $1 |
| Due in one year or less | 63698 | 54893 |
| Due after one year through two years | 13315 | 14474 |
| Due after two years through three years | 13455 | 10312 |
| Due after three years through four years | 7976 | 11080 |
| Due after four years through five years | 6361 | 4990 |
| Thereafter | 5373 | 4980 |
| Total par value | $110178 | $100730 |

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PREPAYMENT FEES

The Bank generally charges a prepayment fee for advances that a borrower elects to terminate prior to the stated maturity or outside of a predetermined call date. The fees charged are priced to make the Bank financially indifferent to the prepayment of the advance. For certain advances with symmetrical prepayment features, the Bank may charge the borrower a prepayment fee or pay the borrower a prepayment credit, depending on certain circumstances, such as movements in interest rates, when the advance is prepaid. Prepayment fees and credits are recorded net of the hedged item basis adjustments, if applicable, in advance interest income on the Statements of Income.

ADVANCE CONCENTRATIONS

The Bank's advances are primarily concentrated in commercial banks and insurance companies. The following table summarizes advances outstanding to members exceeding 10 percent of total advances outstanding at December 31, 2025 (dollars in millions):

---

| | | |
|:---|:---|:---|
| | Amount | % of Total Advances |
| Athene Annuity and Life Company | $23271 | 21% |
| Wells Fargo Bank, N.A. | 16000 | 15 |

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ALLOWANCE FOR CREDIT LOSSES

The Bank evaluates advances for credit losses on a quarterly basis and manages its credit exposure to advances through an approach that includes establishing a credit limit for each borrower. This approach includes an ongoing review of each borrower's financial condition in conjunction with the Bank's collateral and lending policies to limit risk of loss while balancing borrowers' needs for a reliable source of funding. In addition, the Bank lends to eligible borrowers in accordance with the FHLBank Act, Finance Agency regulations, and other applicable laws.

The Bank is required by regulation to obtain sufficient collateral to fully secure its advances. The estimated value of the collateral required to secure each borrower's advances is calculated by applying loan-to-value discounts, or haircuts, to the unpaid principal balance or market value, as applicable, of the collateral. The Bank also has policies and procedures for validating the reasonableness of the Bank's collateral valuations. In addition, collateral verifications and on-site reviews are performed by the Bank based on the risk profile of the borrower. Management believes that these policies effectively manage the Bank's credit risk from advances.

Eligible collateral includes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• fully disbursed whole first mortgages on improved residential real property or securities representing a whole interest in such mortgages;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• loans and securities issued, insured, or guaranteed by the U.S. Government or any agency thereof, including MBS issued or guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• cash deposited with the Bank; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other real estate-related collateral acceptable to the Bank, such as second lien mortgages, home equity lines of credit, municipal securities, and commercial real estate mortgages, provided such collateral has a readily ascertainable value and the Bank can perfect a security interest in it.

CFIs may also pledge collateral consisting of secured small business, small agri-business, or small farm loans. As additional security, the FHLBank Act provides that the Bank has a lien on each member's capital stock investment; however, capital stock cannot be pledged as collateral to secure advances.

Collateral arrangements may vary depending upon borrower credit quality, financial condition and performance; borrowing capacity, the type of member (e.g., commercial bank, insurance company, or CDFI), collateral availability, and overall credit exposure to the borrower. The Bank can also require additional or substitute collateral to protect its security interest. The Bank periodically evaluates and makes changes to its collateral guidelines and collateral haircuts.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

Borrowers may pledge collateral to the Bank by executing a blanket pledge agreement, specifically assigning collateral, or placing physical possession of collateral with the Bank or its custodians. The Bank perfects its security interest in all pledged collateral by filing Uniform Commercial Code financing statements or by taking possession or control of the collateral. Under the FHLBank Act, any security interest granted to the Bank by its members, or any affiliates of its members, has priority over the claims and rights of any party (including any receiver, conservator, trustee, or similar party having rights of a lien creditor), unless those claims and rights would be entitled to priority under otherwise applicable law and are held by actual purchasers or by parties that have perfected security interests.

Under a blanket pledge agreement, the Bank is granted a security interest in all financial assets of the borrower to fully secure the borrower's obligation. Other than securities and cash deposits, the Bank does not initially take delivery of collateral from blanket pledge agreement borrowers. In the event of a default or a deterioration in the financial condition of a blanket pledge agreement borrower, the Bank has the ability to require delivery of pledged collateral sufficient to secure the borrower's obligation. With respect to non-blanket pledge agreement borrowers that are federally insured, the Bank generally requires collateral to be specifically assigned. With respect to non-blanket pledge agreement borrowers that are not federally insured (typically insurance companies, CDFIs, and housing associates), the Bank generally takes control of collateral through the delivery of cash, securities, or loans to the Bank or its custodians.

The Bank evaluates the credit quality of advances using a risk-based approach considering collateral and taking into account each borrower's financial strength. This assessment considers the collateral payment performance and the type and amount of collateral pledged, to be the primary indicators of credit quality. At December 31, 2025 and 2024, the Bank had rights to collateral on a borrower-by-borrower basis with an unpaid principal balance or market value, as applicable, in excess of its outstanding advances.

At December 31, 2025 and 2024, none of the Bank's advances were past due, on non-accrual status, or considered impaired. In addition, there were no modifications related to advances resulting from a borrower experiencing financial difficulties during the years ended December 31, 2025 and 2024.

The Bank has never experienced a credit loss on its advances. Based upon the Bank's collateral and lending policies, the collateral held as security, and the repayment history on advances, management has determined that there were no expected credit losses on its advances as of December 31, 2025 and 2024.

**Note 6 — Mortgage Loans Held for Portfolio** 

Mortgage loans held for portfolio include conventional mortgage loans and government-guaranteed or -insured mortgage loans obtained primarily through the MPF program. The Bank's mortgage loan program involves investment by the Bank in single-family mortgage loans held for portfolio, defined as one-to-four family residential properties, that are purchased from PFIs. Mortgage loans may also be acquired through participations in pools of eligible mortgage loans purchased from other FHLBanks. The Bank's PFIs generally originate, service, and credit enhance mortgage loans that are sold to the Bank. PFIs participating in the servicing release program do not service the loans owned by the Bank. The servicing on these loans is sold concurrently by the PFI to a designated mortgage service provider.

The following table presents information on the Bank's mortgage loans held for portfolio (dollars in millions):

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| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Fixed rate, long-term<sup>1</sup> single-family mortgage loans | $13549 | $10961 |
| Fixed rate, medium-term<sup>2</sup> single-family mortgage loans | 904 | 856 |
| Total unpaid principal balance | 14453 | 11817 |
| Premiums | 156 | 130 |
| Discounts | (54) | (33) |
| Basis adjustments from mortgage loan purchase commitments | (9) | (13) |
| Total mortgage loans held for portfolio<sup>3</sup> | 14546 | 11901 |
| Allowance for credit losses | (6) | (5) |
| Total mortgage loans held for portfolio, net | $14540 | $11896 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Long-term is defined as an original term of greater than 15 years and up to 30 years.

2&nbsp;&nbsp;&nbsp;&nbsp;Medium-term is defined as an original term of 15 years or less.

3&nbsp;&nbsp;&nbsp;&nbsp;Excludes accrued interest receivable of $107 million and $78 million at December 31, 2025 and 2024.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table presents the Bank's mortgage loans held for portfolio by collateral or guarantee type (dollars in millions):

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| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Conventional mortgage loans | $14097 | $11452 |
| Government-guaranteed or - insured mortgage loans | 356 | 365 |
| Total unpaid principal balance | $14453 | $11817 |

---

PAYMENT STATUS OF MORTGAGE LOANS

Payment status is the key credit quality indicator for conventional mortgage loans and allows the Bank to monitor borrower performance. Past due loans are those where the borrower has failed to make contractual principal and/or interest payments for a period of 30 days or more. Other delinquency statistics include non-accrual loans and loans in process of foreclosure.

The following tables presents the payment status for conventional mortgage loans (dollars in millions):

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| | | | |
|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Origination Year | Origination Year | |
| | Prior to 2021 | 2021 to 2025 |<br>Total |
| Past due 30 - 59 days | $36 | $61 | $97 |
| Past due 60 - 89 days | 8 | 12 | 20 |
| Past due 90 - 179 days | 6 | 12 | 18 |
| Past due 180 days or more | 4 | 7 | 11 |
| Total past due mortgage loans | 54 | 92 | 146 |
| Total current mortgage loans | 3243 | 10796 | 14039 |
| Total amortized cost of mortgage loans<sup>1</sup> | $3297 | $10888 | $14185 |

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| | | | |
|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Origination Year | Origination Year | |
| | Prior to 2020 | 2020 to 2024 |<br>Total |
| Past due 30 - 59 days | $28 | $41 | $69 |
| Past due 60 - 89 days | 8 | 11 | 19 |
| Past due 90 - 179 days | 5 | 7 | 12 |
| Past due 180 days or more | 4 | 4 | 8 |
| Total past due mortgage loans | 45 | 63 | 108 |
| Total current mortgage loans | 2347 | 9076 | 11423 |
| Total amortized cost of mortgage loans<sup>1</sup> | $2392 | $9139 | $11531 |

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1&nbsp;&nbsp;&nbsp;&nbsp;Amortized cost represents the unpaid principal balance adjusted for unamortized premiums, discounts, price adjustment fees, basis adjustments, and direct write-downs. Amortized cost excludes accrued interest receivable.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following tables present other delinquency statistics for mortgage loans (dollars in millions):

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| | | | |
|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| Amortized Cost | Conventional | Government-Insured | Total |
| In process of foreclosure<sup>1</sup> | $2 | $1 | $3 |
| Serious delinquency rate<sup>2</sup> | —% | 2% | —% |
| Past due 90 days or more and still accruing interest<sup>3</sup> | $— | $8 | $8 |
| Non-accrual mortgage loans<sup>4</sup> | $62 | $— | $62 |

---

---

| | | | |
|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| Amortized Cost | Conventional | Government- Insured | Total |
| In process of foreclosure<sup>1</sup> | $4 | $1 | $5 |
| Serious delinquency rate<sup>2</sup> | —% | 2% | —% |
| Past due 90 days or more and still accruing interest<sup>3</sup> | $— | $7 | $7 |
| Non-accrual mortgage loans<sup>4</sup> | $49 | $— | $49 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Includes loans where the decision of foreclosure or similar alternative such as pursuit of deed-in-lieu has been reported.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents mortgage loans that are 90 days or more past due or in the process of foreclosure expressed as a percentage of total mortgage loans. Serious delinquency rate on conventional loans was less than one percent at December 31, 2025 and 2024.

3&nbsp;&nbsp;&nbsp;&nbsp;Represents government-insured mortgage loans that are 90 days or more past due.

4&nbsp;&nbsp;&nbsp;&nbsp;Represents conventional mortgage loans that are 90 days or more past due or for which the collection of interest or principal is doubtful. At December 31, 2025 and 2024, $31 million and $25 million of conventional mortgage loans on non-accrual status were evaluated individually and do not have a related allowance for credit losses because these loans were either previously charged off to the expected recoverable value and/or the fair value of the underlying collateral is greater than the amortized cost of the loans.

ALLOWANCE FOR CREDIT LOSSES

The Bank evaluates mortgage loans for credit losses on a quarterly basis.

*Conventional Mortgage Loans* 

The Bank determines its allowances for credit losses on conventional loans through analyses that include consideration of various loan portfolio and collateral-related characteristics, such as past performance, current conditions, and reasonable and supportable forecasts of expected economic conditions. The Bank's allowance for credit losses on conventional mortgage loans was $6 million and $5 million at December 31, 2025 and 2024.

For collectively evaluated loans, the Bank uses a projected cash flow model to estimate expected credit losses over the life of the loans. This model relies on a number of inputs, such as current and projected property values and interest rates, as well as historical borrower behavior experience. The Bank also incorporates associated credit enhancements when determining its estimate of expected credit losses. The Bank may incorporate a management adjustment in the allowance for credit losses for conventional mortgage loans due to changes in economic and business conditions or other factors that may not be fully captured in its model.

For individually evaluated loans, the Bank uses the practical expedient for collateral-dependent assets. A mortgage loan is considered collateral-dependent when repayment is expected to be provided solely by the sale of the underlying collateral. The Bank estimates the fair value of this collateral using a property valuation model. The expected credit loss of a collateral- dependent mortgage loan is equal to the difference between the amortized cost of the loan and the estimated fair value of the collateral, less estimated selling costs and expected proceeds from PMI. The Bank records a direct charge-off of the loan balance if certain triggering criteria are met. Expected recoveries of prior charge-offs are included in the allowance for credit losses.

*Government-Insured Mortgage Loans* 

The Bank invests in government-insured fixed rate mortgage loans portfolios that are insured or guaranteed by the FHA, the Department of Veterans Affairs, Department of Housing and Urban Development, and/or the Rural Housing Service of the Department of Agriculture. The servicer or PFI obtains and maintains insurance or a guaranty from the applicable government agency.

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The Bank has never experienced a credit loss on its government-insured mortgage loans. At December 31, 2025 and 2024, the Bank assessed its servicers and determined there was no expectation that a servicer would fail to remit payments due until paid in full. As a result, the Bank did not establish an allowance for credit losses for its government-insured mortgage loans at December 31, 2025 and 2024. Furthermore, none of these mortgage loans have been placed on non-accrual status because of the U.S. Government guarantee or insurance on these loans and the contractual obligation of the loan servicer to repurchase the loans when certain criteria are met.

**Note 7 — Derivatives and Hedging Activities** 

NATURE OF BUSINESS ACTIVITY

The Bank is exposed to interest rate risk primarily from the effect of interest rate changes on its interest-earning assets and its related funding sources. The goal of the Bank's interest rate risk management strategy is not to eliminate interest rate risk, but to manage it within appropriate limits. To mitigate the risk of loss, the Bank has established policies and procedures which include guidelines on the amount of exposure to interest rate changes it is willing to accept.

The Bank enters into derivative contracts to manage the interest rate risk exposures inherent in its otherwise unhedged assets and funding positions. Finance Agency regulations and the Bank's risk management policies establish guidelines for derivatives, prohibit the speculative use of derivatives, and limit credit risk arising from derivatives.

Derivative financial instruments are used by the Bank to achieve its financial and risk management objectives. The Bank reevaluates its hedging strategies periodically and may change the hedging techniques it uses or may adopt new strategies. The most common ways in which the Bank uses derivatives are to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reduce the interest rate sensitivity and repricing gaps of assets and liabilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• preserve an interest rate spread between the yield of an asset and the cost of the related liability. Without the use of derivatives, this interest rate spread could be reduced or eliminated when a change in the interest rate on the asset does not match a change in the interest rate on the liability;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• mitigate the adverse earnings effects of the shortening or extension of certain assets and liabilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• manage embedded options in assets and liabilities; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reduce funding costs by combining a derivative with a consolidated obligation, as the cost of a combined funding structure can be lower than the cost of a comparable consolidated obligation.

TYPES OF DERIVATIVES

The Bank may use the following derivative instruments:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Interest Rate Swaps.* An interest rate swap is an agreement between two entities to exchange cash flows in the future. The agreement sets the dates on which the cash flows will be exchanged and the manner in which the cash flows will be calculated. One of the simplest forms of an interest rate swap involves the promise by one party to pay cash flows equivalent to the interest on a notional amount at a predetermined fixed rate for a given period of time. In return for this promise, this party receives cash flows equivalent to the interest on the same notional amount at a variable interest rate index for the same period of time. The variable interest rate received or paid by the Bank in derivative transactions is primarily the OIS rate, based on either federal funds or SOFR.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Options.* An option is an agreement between two entities that conveys the right, but not the obligation, to engage in a future transaction on some underlying security or other financial asset at an agreed-upon price during a certain period of time or on a specific date. Premiums or swap fees paid to acquire options are considered the fair value of the option at inception of the hedge and are reported as derivative assets on the Statements of Condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Swaptions.* A swaption is an option on a swap that gives the buyer the right to enter into a specified interest rate swap at a certain time in the future. When used as a hedge, a swaption can protect the Bank against future interest rate changes. The Bank may enter into both payer and receiver swaptions. A payer swaption is the option to make fixed interest payments at a later date and a receiver swaption is the option to receive fixed interest payments at a later date.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Interest Rate Caps and Floors.* In an interest rate cap agreement, a cash flow is generated if the price or interest rate of an underlying variable rises above a certain threshold (or "cap") price. In an interest rate floor agreement, a cash flow is generated if the price or interest rate of an underlying variable falls below a certain threshold (or "floor") price. Interest rate caps and floors are designed as protection against the interest rate on a variable rate asset or liability rising above or falling below a certain level.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Futures/Forwards Contracts.* Futures and forwards contracts give the buyer the right to buy or sell a specific type of asset at a specific time at a given price. For example, certain mortgage loan purchase commitments entered into by the Bank are considered derivatives. The Bank may hedge these commitments by selling TBA MBS for forward settlement. A TBA MBS represents a forward contract for the sale of MBS at a future agreed-upon date for an established price.

TYPES OF HEDGED ITEMS

The Bank may have the following types of hedged items:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Investment Securities.* The Bank primarily invests in U.S. Treasury obligations, other U.S. obligations, GSE and TVA obligations, state or local housing agency obligations, and agency MBS, and classifies them as either trading, AFS, or HTM. The interest rate and prepayment risk associated with these investment securities is managed through a combination of debt issuance and derivatives. To manage interest rate risk, the Bank may fund investment securities with callable consolidated obligations or utilize interest rate swaps, caps, floors, or swaptions. Derivatives held by the Bank that are associated with trading and HTM securities, if applicable, are economic hedges and derivatives held by the Bank associated with AFS securities are generally fair value hedges.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Advances.* The Bank offers a wide range of fixed and variable rate advance products with different maturities, interest rates, payment characteristics, and optionality. The Bank may use derivatives to adjust the repricing and/or option characteristics of advances in order to more closely match the characteristics of its funding liabilities. When a borrower executes a fixed rate advance or a variable rate advance with embedded options, the Bank may simultaneously execute a derivative with terms that offset the terms and embedded options, if any, in the advance. For example, the Bank may hedge a fixed rate advance with an interest rate swap where the Bank pays a fixed rate coupon and receives a variable rate coupon, effectively converting the fixed rate advance to a variable rate advance. This type of hedge is typically treated as a fair value hedge. In addition, the Bank may hedge a callable advance, which gives the borrower the option to extinguish the fixed rate advance, by entering into a cancelable interest rate swap.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Mortgage Loans.* The Bank invests in fixed rate mortgage loans. The prepayment options embedded in mortgage loans can result in extensions or contractions in the expected repayment of these investments, depending on changes in actual and estimated prepayment speeds. The Bank manages the interest rate risk associated with mortgage loans through a combination of debt issuance and derivatives. The Bank may issue both callable and non-callable debt to achieve cash flow patterns and liability durations similar to those expected on the mortgage loans. The Bank may also purchase interest rate caps, floors, or swaptions to minimize the interest rate risk embedded in mortgage assets. Although these derivatives are valid economic hedges, they are not specifically linked to individual mortgage assets and, therefore, do not receive fair value hedge accounting.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Consolidated Obligations.* The Bank may enter into derivatives to hedge the interest rate risk associated with its consolidated obligations. For example, the Bank may issue and hedge a fixed rate consolidated obligation with an interest rate swap where the Bank receives a fixed rate coupon and pays a variable rate coupon, effectively converting the fixed rate consolidated obligation to a variable rate consolidated obligation. This type of hedge is typically treated as a fair value hedge. The Bank may also issue variable interest rate consolidated obligations and simultaneously execute interest rate swaps to manage the interest rate risk of the variable interest rate debt. Interest rate swaps used to hedge variable interest rate debt do not qualify for hedge accounting and are treated as economic hedges. In addition, derivatives held by the Bank that are associated with consolidated obligations for which the fair value option has been elected are treated as economic hedges. This strategy of issuing consolidated obligations while simultaneously entering into derivatives enables the Bank to offer a wider range of attractively priced advances to its borrowers and may allow the Bank to reduce its funding costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Firm Commitments*. Certain mortgage loan purchase commitments are considered derivatives. The Bank normally hedges these commitments by selling TBA MBS for forward settlement. A TBA MBS represents a forward contract for the sale of MBS at a future agreed-upon date for an established price. The mortgage loan purchase commitment and the TBA used in the firm commitment hedging strategy are considered economic hedges. When the mortgage loan purchase commitment derivative settles, the current market value of the commitment is included with the basis of the mortgage loan and amortized over the contractual life of the mortgage loan using the level-yield method. The Bank may also hedge a firm commitment for a forward-starting advance through the use of an interest-rate swap, which is considered a fair value hedge.

For additional information on the Bank's derivatives, see "<u>[Note 1 — Summary of Significant Accounting Policies](#i6940522039644a7690f9aab973fdec20_169)</u>."

FINANCIAL STATEMENT EFFECT AND ADDITIONAL FINANCIAL INFORMATION

The notional amount of derivatives serves as a factor in determining periodic interest payments and cash flows received and paid. However, the notional amount of derivatives represents neither the actual amounts exchanged nor the overall exposure of the Bank to credit and market risk. The risks of derivatives can be measured meaningfully on a portfolio basis that takes into account the counterparties, the types of derivatives, the items being hedged, and any offsets between the derivatives and the items being hedged.

The following table summarizes the Bank's notional amount and fair value of derivative instruments and total derivative assets and liabilities. Total derivative assets and liabilities include the effect of netting adjustments and cash collateral. For purposes of this disclosure, the derivative values include the fair value of derivatives and the related accrued interest (dollars in millions):

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Notional <br>Amount | Derivative<br>Assets | Derivative<br> Liabilities | Notional <br>Amount | Derivative<br>Assets | Derivative<br> Liabilities |
| Derivatives designated as hedging instruments (fair value hedges) |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swaps | $162769 | $237 | $29 | $99170 | $200 | $60 |
| Derivatives not designated as hedging instruments (economic hedges) |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swaps | 23176 | 3 |  | 55732 | 1 |  |
| &nbsp;&nbsp;&nbsp;Forward settlement agreements | 111 |  |  | 91 | 1 |  |
| &nbsp;&nbsp;&nbsp;Mortgage loan purchase commitments | 106 |  |  | 101 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total derivatives not designated as hedging instruments | 23393 | 3 |  | 55924 | 2 |  |
| Total derivatives before netting and collateral adjustments | $186162 | 240 | 29 | $155094 | 202 | 60 |
| Netting adjustments and cash collateral<sup>1</sup> |  | (160) | (26) |  | 602 | (54) |
| Total derivative assets and derivative liabilities |  | $80 | $3 |  | $804 | $6 |

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1&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent the application of the netting requirements that allow the Bank to net settle positive and negative positions and also cash collateral, including accrued interest, held or placed with the same clearing agent and/or counterparty. At December 31, 2025 and 2024, cash collateral, including accrued interest, posted by the Bank was $3 million and $815 million. At December 31, 2025 and 2024, the Bank held cash collateral, including accrued interest, from clearing agents and/or counterparties of $137 million and $159 million.

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The following tables summarize the net gains (losses) on qualifying fair value hedging relationships and the amortization of basis adjustments on discontinued fair value hedging relationships recorded in net interest income, including the net interest settlements on derivatives, as well as total income (expense) by product recorded on the Statements of Income (dollars in millions):

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| | | | | |
|:---|:---|:---|:---|:---|
| | For the Year Ended December 31, 2025  | For the Year Ended December 31, 2025  | For the Year Ended December 31, 2025  | For the Year Ended December 31, 2025  |
| | Interest Income (Expense) | Interest Income (Expense) | Interest Income (Expense) | Interest Income (Expense) |
| | Advances | AFS Securities | Consolidated Obligation Discount Notes | Consolidated Obligation Bonds |
| Total interest income (expense) recorded on the Statements of Income<sup>1</sup> | $5080 | $1390 | $(2829) | $(4578) |
| Gains (losses) on fair value hedging relationships |  |  |  |  |
| &nbsp;&nbsp;Interest rate contracts |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Derivatives<sup>2</sup> | (381) | (397) | 7 | 57 |
| &nbsp;&nbsp;&nbsp;&nbsp;Hedged items<sup>3</sup> | 834 | 591 | (17) | (78) |
| Net gains (losses) on fair value hedging relationships | $453 | $194 | $(10) | $(21) |

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| | | | |
|:---|:---|:---|:---|
| | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 | For the Year Ended December 31, 2024 |
| | Interest Income (Expense) | Interest Income (Expense) | Interest Income (Expense) |
| | Advances | AFS Securities | Consolidated Obligation Bonds |
| Total interest income (expense) recorded on the Statements of Income<sup>1</sup> | $6013 | $1484 | $(4821) |
| Gains (losses) on fair value hedging relationships |  |  |  |
| &nbsp;&nbsp;Interest rate contracts |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Derivatives<sup>2</sup> | 921 | 866 | (182) |
| &nbsp;&nbsp;&nbsp;&nbsp;Hedged items<sup>3</sup> | (65) | (521) | (3) |
| Net gains (losses) on fair value hedging relationships | $856 | $345 | $(185) |

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| | | | |
|:---|:---|:---|:---|
| | For the Year Ended December 31, 2023 | For the Year Ended December 31, 2023 | For the Year Ended December 31, 2023 |
| | Interest Income (Expense) | Interest Income (Expense) | Interest Income (Expense) |
| | Advances | AFS Securities | Consolidated Obligation Bonds |
| Total interest income (expense) recorded on the Statements of Income<sup>1</sup> | $6533 | $1203 | $(5392) |
| Gains (losses) on fair value hedging relationships |  |  |  |
| &nbsp;&nbsp;Interest rate contracts |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Derivatives<sup>2</sup> | 328 | 119 | (37) |
| &nbsp;&nbsp;&nbsp;&nbsp;Hedged items<sup>3</sup> | 486 | 245 | (243) |
| Net gains (losses) on fair value hedging relationships | $814 | $364 | $(280) |

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1&nbsp;&nbsp;&nbsp;&nbsp;Amounts shown to give context to the disclosure and include total interest income (expense) of the products indicated, including coupon, prepayment fees, amortization, and derivative net interest settlements. Interest income (expense) amounts also include gains and losses on derivatives and hedged items in fair value hedging relationships.

2&nbsp;&nbsp;&nbsp;&nbsp;Includes changes in fair value and net interest settlements on derivatives.

3&nbsp;&nbsp;&nbsp;&nbsp;Includes changes in fair value and amortization/accretion of basis adjustments on closed hedge relationships.

&nbsp;&nbsp;&nbsp;&nbsp;

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The following tables summarize cumulative fair value hedging adjustments and the related amortized cost of the hedged items (dollars in millions):

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Advances | AFS Securities | Consolidated Obligation Discount Notes | Consolidated Obligation Bonds |
| Amortized cost of hedged asset/liability<sup>1</sup> | $58516 | $19983 | $61439 | $20546 |
| Fair value hedging adjustments |  |  |  |  |
| &nbsp;&nbsp;Changes in fair value for active hedging relationships included in amortized cost | $82 | $(315) | $17 | $56 |
| &nbsp;&nbsp;Basis adjustments for discontinued hedging relationships included in amortized cost | (10) | (42) |  |  |
| Total amount of fair value hedging adjustments | $72 | $(357) | $17 | $56 |

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| | | | |
|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Advances | AFS Securities | Consolidated Obligation Bonds |
| Amortized cost of hedged asset/liability<sup>1</sup> | $57580 | $17631 | $22166 |
| Fair value hedging adjustments |  |  |  |
| &nbsp;&nbsp;Changes in fair value for active hedging relationships included in amortized cost | $(733) | $(922) | $(21) |
| &nbsp;&nbsp;Basis adjustments for discontinued hedging relationships included in amortized cost | (28) | (26) | (1) |
| Total amount of fair value hedging adjustments | $(761) | $(948) | $(22) |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents the portion of amortized cost designated as a hedged item in an active or discontinued fair value hedging relationship. Amortized cost includes fair value hedging adjustments.

The following table summarizes the components of "Net gains (losses) on derivatives" as presented on the Statements of Income (dollars in millions):

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| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| Derivatives not designated as hedging instruments (economic hedges) |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swaps | $(69) | $44 | $45 |
| &nbsp;&nbsp;&nbsp;Forward settlement agreements | (4) | 1 | 2 |
| &nbsp;&nbsp;&nbsp;Mortgage loan purchase commitments | 4 | (2) | (4) |
| &nbsp;&nbsp;&nbsp;Net interest settlements | 17 | (37) | (52) |
| Total net gains (losses) related to derivatives not designated as hedging instruments | (52) | 6 | (9) |
| &nbsp;&nbsp;Price alignment amount<sup>1</sup> | 1 | 2 | (32) |
| Net gains (losses) on derivatives | $(51) | $8 | $(41) |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents the price alignment amount on derivatives for which variation margin is characterized as a daily settled contract. The price alignment amount on variation margin for daily settled derivative contracts designated as hedging instruments is recorded in the same line item as the earnings effect of the hedged item.

MANAGING CREDIT RISK ON DERIVATIVES

The Bank is subject to credit risk due to the risk of nonperformance by counterparties to its derivative contracts. The Bank manages credit risk through credit analysis of derivative counterparties, collateral requirements, and adherence to the requirements set forth in the Bank's policies, CFTC regulations, and Finance Agency regulations.

The Bank transacts most of its derivative transactions with large banks and major broker-dealers. Over-the-counter derivative transactions may be either executed directly with a counterparty, referred to as uncleared derivatives, or cleared through a clearing agent with a clearinghouse, referred to as cleared derivatives. Once a derivative transaction has been accepted for clearing by a clearinghouse, the derivative transaction is novated and the executing counterparty is replaced with the clearinghouse. The Bank is not a derivative dealer and does not trade derivatives for short-term profit.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

For uncleared derivatives, the degree of credit risk is impacted by the extent to which master netting arrangements are included in the derivative contracts to mitigate the risk. The Bank requires collateral agreements on its uncleared derivatives.

Uncleared derivative transactions executed on or after September 1, 2022 are subject to two-way initial margin requirements if the Bank's aggregate uncleared derivative transactions exposure to a counterparty exceeds a specified threshold. The initial margin is required to be held at a third-party custodian and does not change ownership. Rather, the party in respect of which the initial margin has been posted to the third-party custodian will have a security interest in the amount of initial margin required under the uncleared margin rules and can only take ownership upon the occurrence of certain events, including an event of default due to bankruptcy, insolvency, or similar proceeding. As of December 31, 2025, the Bank was not required to post initial margin on its uncleared derivative transactions in accordance with the noted regulation.

For uncleared transactions, the derivative agreements are fully collateralized with a zero unsecured threshold in accordance with variation margin requirements issued by the U.S. federal bank regulatory agencies and the CFTC.

For cleared derivatives, the clearinghouse is the Bank's counterparty. The Bank utilizes two clearinghouses, CME Clearing, and LCH Ltd., for all cleared derivative transactions. CME Clearing and LCH Ltd. notify the clearing agent of the required initial margin and daily variation margin requirements, and the clearing agent in turn notifies the Bank.

Each clearinghouse determines initial margin requirements which can be either cash or securities collateral. Generally credit ratings are not factored into the initial margin. However, clearing agents may require additional initial margin to be posted based on credit considerations, including, but not limited to, credit rating downgrades. The Bank was not required to post additional initial margin by its clearing agent, based on credit considerations, at December 31, 2025. Variation margin requirements with each clearinghouse are based on changes in the fair value of cleared derivatives and are legally characterized as daily settlement payments, rather than cash collateral.

The requirement that the Bank post initial and variation margin through the clearing agent, to the clearinghouse, exposes the Bank to institutional credit risk if the clearing agent or the clearinghouse fails to meet its obligations. The use of cleared derivatives is intended to mitigate credit risk exposure because a central counterparty is substituted for individual counterparties and collateral/payments for changes in the fair value of cleared derivatives is posted daily through a clearing agent.

OFFSETTING OF DERIVATIVE ASSETS AND DERIVATIVE LIABILITIES

The Bank presents derivative instruments, related cash collateral received or pledged, and associated accrued interest on a net basis by clearing agent and/or by counterparty when it has met the netting requirements. Additional information regarding these agreements is provided in "<u>[Note 1 — Summary of Significant Accounting Policies](#i6940522039644a7690f9aab973fdec20_169)</u>."

The Bank has analyzed the enforceability of offsetting rights incorporated in its cleared derivative transactions and has determined that the exercise of those offsetting rights by a non-defaulting party under these transactions should be upheld under applicable law upon an event of default, including a bankruptcy, insolvency, or similar proceeding involving the clearinghouse or the clearing agent, or both. Based on this analysis, the Bank presents a net derivative receivable or payable for all of its transactions through a particular clearing agent with a particular clearinghouse.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following tables present the fair value of derivative instruments meeting or not meeting the netting requirements and the related collateral received from or pledged to counterparties (dollars in millions):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Derivative Instruments Meeting Netting Requirements | Derivative Instruments Meeting Netting Requirements | | | | |
| | Gross Amount Recognized<sup>1</sup> | Gross Amounts of Netting Adjustments and Cash Collateral |<br>Derivative Instruments Not Meeting Netting Requirements<sup>2</sup> |<br>Total Derivative Assets and Total Derivative Liabilities |<br>Non-cash Collateral Not Offset - Can be Sold or Repledged |<br>Net amount<sup>3</sup> |
| Derivative Assets |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Uncleared derivatives | $159 | $(158) | $— | $1 | $— | $1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cleared derivatives | 81 | (2) |  | 79 |  | 79 |
| Total | $240 | $(160) | $— | $80 | $— | $80 |
| Derivative Liabilities |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Uncleared derivatives | $27 | $(24) | $— | $3 | $— | $3 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cleared derivatives | 2 | (2) |  |  |  |  |
| Total | $29 | $(26) | $— | $3 | $— | $3 |

---

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Derivative Instruments Meeting Netting Requirements | Derivative Instruments Meeting Netting Requirements | | | | |
| | Gross Amount Recognized<sup>1</sup> | Gross Amounts of Netting Adjustments and Cash Collateral |<br>Derivative Instruments Not Meeting Netting Requirements<sup>2</sup> |<br>Total Derivative Assets and Total Derivative Liabilities |<br>Non-cash Collateral Not Offset - Can be Sold or Repledged |<br>Net amount<sup>3</sup> |
| Derivative Assets |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Uncleared derivatives | $181 | $(180) | $— | $1 | $— | $1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cleared derivatives | 21 | 782 |  | 803 |  | 803 |
| Total | $202 | $602 | $— | $804 | $— | $804 |
| Derivative Liabilities |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Uncleared derivatives | $57 | $(51) | $— | $6 | $— | $6 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cleared derivatives | 3 | (3) |  |  |  |  |
| Total | $60 | $(54) | $— | $6 | $— | $6 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents derivative assets and derivative liabilities prior to netting adjustments and cash collateral, including accrued interest.

2 &nbsp;&nbsp;&nbsp;&nbsp;Represents mortgage loan purchase commitments not subject to enforceable netting requirements.

3&nbsp;&nbsp;&nbsp;&nbsp;Any over-collateralization at an individual clearing agent and/or counterparty level is not included in the determination of the net amount.&nbsp;&nbsp;&nbsp;&nbsp;At December 31, 2025 and 2024, the Bank had additional net credit exposure of $1.4 billion and $0.5 billion due to instances where the Bank's non-cash collateral to a counterparty exceeded the Bank's net derivative position.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Note 8 — Deposits**

The Bank offers demand and overnight deposits as well as short-term interest-bearing deposits to members and to qualifying non-members. Deposits classified as demand and overnight pay interest based on a daily interest rate. Short-term interest-bearing deposits pay interest based on a fixed rate determined at the issuance of the deposit.

The following table details the Bank's interest-bearing and non-interest-bearing deposits (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Interest-bearing |  |  |
| &nbsp;&nbsp;&nbsp;Demand and overnight | $960 | $1186 |
| &nbsp;&nbsp;&nbsp;Term | 10 | 9 |
| Non-interest-bearing |  |  |
| &nbsp;&nbsp;&nbsp;Demand | 177 | 119 |
| Total | $1147 | $1314 |

---

**Note 9 — Consolidated Obligations**

&nbsp;&nbsp;&nbsp;&nbsp;Consolidated obligations consist of bonds and discount notes. The FHLBanks issue consolidated obligations through the Office of Finance as their agent. Bonds are issued primarily to raise intermediate- and long-term funds for the Bank and are not subject to any statutory or regulatory limits on their maturity. Discount notes are issued primarily to raise short-term funds for the Bank and have original maturities of up to one year. Discount notes sell at or below their face amount and are redeemed at par value when they mature.

&nbsp;&nbsp;&nbsp;&nbsp;Although the Bank is primarily liable for the portion of consolidated obligations issued on its behalf, it is also jointly and severally liable with the other FHLBanks for the payment of principal and interest on all FHLBank System consolidated obligations. The Finance Agency, at its discretion, may require any FHLBank to make principal and/or interest payments due on any consolidated obligation, whether or not the primary obligor FHLBank has defaulted on the payment of that consolidated obligation. The Finance Agency has never exercised this discretionary authority. At December 31, 2025 and 2024, the total par value of outstanding consolidated obligations of the FHLBanks was $1,151.8 billion and $1,193.0 billion.

DISCOUNT NOTES

The following table summarizes the Bank's discount notes (dollars in millions):

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| | Amount | Weighted<br>Average<br>Interest<br>Rate | Amount | Weighted<br>Average<br>Interest<br>Rate |
| Par value | $85186 | 3.76% | $65250 | 4.51% |
| Discounts and concessions<sup>1</sup> | (586) |  | (586) |  |
| Fair value hedging adjustments | 17 |  |  |  |
| Fair value option adjustments | 3 |  | 16 |  |
| Total | $84620 |  | $64680 |  |

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1&nbsp;&nbsp;&nbsp;&nbsp;Concessions represent fees paid to dealers in connection with the issuance of certain consolidated obligation discount notes.

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BONDS

The following table summarizes the Bank's bonds outstanding by contractual maturity (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| Year of Contractual Maturity | Amount | Weighted<br>Average<br>Interest<br>Rate | Amount | Weighted<br>Average<br>Interest<br>Rate |
| Due in one year or less | $38808 | 3.76% | $43287 | 4.53% |
| Due after one year through two years | 32347 | 3.84 | 28333 | 4.45 |
| Due after two years through three years | 3577 | 4.11 | 2712 | 3.85 |
| Due after three years through four years | 3351 | 3.71 | 2957 | 4.19 |
| Due after four years through five years | 2399 | 3.44 | 4021 | 4.01 |
| Thereafter | 8706 | 4.52 | 7278 | 4.11 |
| Total par value | 89188 | 3.87% | 88588 | 4.41% |
| Premiums | 28 |  | 30 |  |
| Discounts and concessions<sup>1</sup> | (23) |  | (25) |  |
| Fair value hedging adjustments | 56 |  | (22) |  |
| Total | $89249 |  | $88571 |  |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Concessions represent fees paid to dealers in connection with the issuance of certain consolidated obligation bonds.

Bonds are issued with fixed or variable rate payment terms, such as SOFR. To meet the specific needs of certain investors, both fixed and variable rate bonds may also contain certain embedded features, which result in complex coupon payment terms and call features. When these consolidated bonds are issued, the Bank may enter into derivatives containing features that offset the terms and embedded options, if any, of the consolidated bond obligations.

The following table summarizes the Bank's bonds outstanding by call features (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2025 | 2024 |
| Non-callable or non-putable | $37814 | $56373 |
| Callable | 51374 | 32215 |
| Total par value | $89188 | $88588 |

---

The following table summarizes the Bank's bonds outstanding by year of contractual maturity or next call date (dollars in millions):

---

| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| Year of Contractual Maturity or Next Call Date | 2025 | 2024 |
| Due in one year or less | $79984 | $69363 |
| Due after one year through two years | 3609 | 12793 |
| Due after two years through three years | 2901 | 2531 |
| Due after three years through four years | 1594 | 1952 |
| Due after four years through five years | 685 | 1399 |
| Thereafter | 415 | 550 |
| Total par value | $89188 | $88588 |

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**Note 10 — Affordable Housing Program**

The FHLBank Act requires each FHLBank to establish and fund an AHP, which provides direct grants or subsidies for below-market rate advances to members who provide the funds to assist in the purchase, construction, or rehabilitation of affordable housing for very low-, low-, or moderate-income households. Each FHLBank recognizes AHP assessment expense equal to the greater of 10 percent of its annual income subject to assessment, or its prorated portion of the sum required to ensure the aggregate contribution by the FHLBanks is no less than $100 million for each year. For purposes of the statutory AHP assessment, income subject to assessment is defined as net income before AHP assessments, plus interest expense related to MRCS. The Bank accrues the AHP assessment monthly based on its income subject to assessment and reduces the AHP liability as program funds are distributed.

If the Bank experiences a net loss for a full year, it would have no obligation to the AHP for the year, because its required annual AHP contribution is limited to its annual income subject to AHP assessment. If the aggregate 10 percent AHP calculation was less than $100 million for the FHLBanks (i.e., a shortfall), each FHLBank would be required to contribute a prorated portion of the sum to ensure that the aggregate contribution by the FHLBanks equals $100 million. The pro-ration would be made on the basis of an FHLBank's income in relation to the income of all FHLBanks for the year, subject to the annual income limitation.

There was no contribution shortfall, as described above, in 2025, 2024, or 2023. If an FHLBank finds that its required contributions are contributing to its financial instability, it may apply to the Finance Agency for a temporary suspension of its contributions under the FHLBank Act. The Bank did not make any such application in 2025, 2024, or 2023.

In addition to the statutory AHP assessment, the Bank may elect to make voluntary contributions to the AHP or other housing programs and community investment initiatives. The income statement effects of the Bank's voluntary programs reduce net income before assessments which, in turn, reduces the statutory AHP assessment each year. The Bank has committed to making supplemental voluntary contributions to AHP by an amount that equals what the statutory AHP assessment would be in the absence of these effects. Statutory AHP assessments and all voluntary contributions to the AHP are recorded in the AHP liability on the Statements of Condition. Statutory AHP assessments and supplemental voluntary AHP contributions recorded as expense in the current year are generally awarded in the subsequent year and may be disbursed over several years.

The following table presents a rollforward of the Bank's AHP liability (dollars in millions):

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| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| Balance, beginning of year | $262 | $198 | $135 |
| &nbsp;&nbsp;&nbsp;Assessments | 98 | 102 | 107 |
| &nbsp;&nbsp;Voluntary AHP expense | 7 | 6 | 5 |
| &nbsp;&nbsp;Supplemental voluntary AHP expense | 8 | 7 |  |
| &nbsp;&nbsp;&nbsp;Disbursements | (74) | (51) | (49) |
| Balance, end of year | $301 | $262 | $198 |

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**Note 11 — Capital**

CAPITAL STOCK

The Bank's capital stock has a par value of $100 per share, and all shares are issued, redeemed, and repurchased only at the stated par value. The Bank issues a single class of capital stock (Class B capital stock) and has two subclasses of Class B capital stock: membership and activity-based. Each member must purchase and hold membership capital stock in an amount equal to 0.06 percent of its total assets as of the preceding December 31<sup>st</sup>, subject to a cap of $10 million and a floor of $10,000. Each member is also required to purchase activity-based capital stock equal to 4.50 percent of its outstanding advances, 4.00 percent of its outstanding mortgage loans, and 0.10 percent of its outstanding standby letters of credit. All capital stock issued is subject to a notice of redemption period of five years.

The capital stock requirements established in the Bank's Capital Plan are designed so that the Bank can remain adequately capitalized as member activity changes. The Bank's Board of Directors may make adjustments to the capital stock requirements within ranges established in the Capital Plan.

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EXCESS STOCK

Capital stock owned by members in excess of their investment requirement is deemed excess capital stock. Under its Capital Plan, the Bank, at its discretion and upon 15 days written notice, may repurchase excess membership capital stock. The Bank, at its discretion, may also repurchase excess activity-based capital stock to the extent that (i) the excess capital stock balance exceeds an operational threshold set forth in the Capital Plan, which is currently set at zero, or (ii) a member submits a notice to redeem all or a portion of the excess activity-based capital stock. At December 31, 2025 and 2024, the Bank had no excess capital stock outstanding.

MANDATORILY REDEEMABLE CAPITAL STOCK

The Bank reclassifies capital stock subject to redemption from equity to a liability, which represents MRCS, at the time shares meet the definition of a mandatorily redeemable financial instrument. This occurs after a member provides written notice of redemption, gives notice of intention to withdraw from membership, becomes ineligible for continuing membership, or attains non-member status by merger or consolidation, charter termination, or other involuntary termination from membership. Dividends on MRCS are classified as interest expense on the Statements of Income. The Bank recorded interest expense on MRCS of $3 million, $1 million, and $1 million for the years ended December 31, 2025, 2024, and 2023.

The following table summarizes changes in MRCS (dollars in millions):

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| | | | |
|:---|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 | 2023 |
| Balance, beginning of period | $9 | $12 | $15 |
| &nbsp;&nbsp;&nbsp;Capital stock reclassified to (from) MRCS, net | 143 | 1 | 4 |
| &nbsp;&nbsp;&nbsp;Net payments for repurchases/redemptions of MRCS | (122) | (4) | (7) |
| Balance, end of period | $30 | $9 | $12 |

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The following table summarizes the Bank's MRCS by year of contractual redemption (dollars in millions):

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| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| Year of Contractual Redemption<sup>1</sup> | 2025 | 2024 |
| Due in one year or less | $4 | $— |
| Due after one year through two years |  | 5 |
| Due after four years through five years | 23 |  |
| Past contractual redemption date due to outstanding activity with the Bank | 3 | 4 |
| Total | $30 | $9 |

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1&nbsp;&nbsp;&nbsp;&nbsp;At the Bank's election, MRCS may be redeemed prior to the expiration of the five year redemption period that commences on the date of the notice of redemption.

RESTRICTED RETAINED EARNINGS

The Bank entered into a JCE Agreement with all of the other FHLBanks in 2011. The JCE Agreement, as amended, is intended to enhance the capital position of the FHLBanks over time. Under the JCE Agreement, each FHLBank is required to allocate 20 percent of its quarterly net income to a separate restricted retained earnings account until the balance of that account, calculated as of the last day of each calendar quarter, equals at least one percent of its average balance of outstanding consolidated obligations for the calendar quarter. The restricted retained earnings are not available to pay dividends. At December 31, 2025 and 2024, the Bank's restricted retained earnings account totaled $1.3 billion and $1.1 billion.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following table summarizes changes in AOCI (dollars in millions):

---

| | |
|:---|:---|
| | Total AOCI |
| **Balance, December 31, 2022** | $(117) |
| &nbsp;&nbsp;&nbsp;Net change in fair value of AFS securities | (64) |
| &nbsp;&nbsp;&nbsp;Net actuarial gains (losses) on postretirement benefits | 1 |
| **Balance, December 31, 2023** | (180) |
| &nbsp;&nbsp;&nbsp;Net change in fair value of AFS securities | 151 |
| **Balance, December 31, 2024** | (29) |
| &nbsp;&nbsp;&nbsp;Net change in fair value of AFS securities | 210 |
| **Balance, December 31, 2025** | $181 |

---

REGULATORY CAPITAL REQUIREMENTS

The Bank is subject to three regulatory capital requirements:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Risk-based capital*. The Bank must maintain at all times permanent capital greater than or equal to the sum of its credit, market, and operational risk capital requirements, all calculated in accordance with Finance Agency regulations. Only permanent capital, defined as the amounts paid-in for Class B capital stock (including MRCS), and retained earnings can satisfy this risk-based capital requirement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Regulatory capital*. The Bank is required to maintain a minimum four percent capital-to-asset ratio, which is defined as total regulatory capital divided by total assets. Total regulatory capital includes Class B stock (including MRCS) and retained earnings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Leverage capital*. The Bank is required to maintain a minimum five percent leverage ratio, which is defined as the sum of permanent capital weighted 1.5 times and nonpermanent capital weighted 1.0 times, divided by total assets. The Bank did not hold any nonpermanent capital at December 31, 2025 and 2024.

In addition to the requirements previously discussed, the Capital Stock AB requires each FHLBank to maintain at all times a ratio of at least two percent of capital stock to total assets. For purposes of the Capital Stock AB, capital stock includes MRCS. The capital stock to total assets ratio is measured on a daily average basis at month end.

If the Bank's capital falls below the required levels, the Finance Agency has authority to take actions necessary to return it to levels that it deems to be consistent with safe and sound business operations.

The following table shows the Bank's compliance with the Finance Agency's regulatory capital requirements (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| | Required | Actual | Required | Actual |
| Regulatory capital requirements |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Risk-based capital | $1878 | $10336 | $1499 | $9489 |
| &nbsp;&nbsp;&nbsp;Regulatory capital | $7460 | $10336 | $6610 | $9489 |
| &nbsp;&nbsp;&nbsp;Leverage capital | $9325 | $15504 | $8263 | $14233 |
| &nbsp;&nbsp;&nbsp;Capital-to-assets ratio | 4.00% | 5.54% | 4.00% | 5.74% |
| &nbsp;&nbsp;&nbsp;Capital stock-to-assets ratio | 2.00% | 3.38% | 2.00% | 3.53% |
| &nbsp;&nbsp;&nbsp;Leverage ratio | 5.00% | 8.31% | 5.00% | 8.61% |

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CAPITAL CLASSIFICATION DETERMINATION

The Finance Agency determines each FHLBank's capital classification on at least a quarterly basis. If an FHLBank is determined to be other than adequately capitalized, that FHLBank becomes subject to additional supervisory authority by the Finance Agency. Before implementing a reclassification, the Director of the Finance Agency is required to provide the FHLBank with written notice of the proposed action and an opportunity to submit a response. As of the most recent notification date by the Finance Agency, the Bank was classified as adequately capitalized.

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**Note 12 — Fair Value**

Fair value amounts are determined by the Bank using available market information and reflect the Bank's best judgment of appropriate valuation methods. GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e., exit price). The fair value hierarchy requires an entity to maximize the use of significant observable inputs and minimize the use of significant unobservable inputs when measuring fair value. The inputs are evaluated and an overall level for the fair value measurement is determined. This overall level is an indication of market observability of the fair value measurement for the asset or liability.

The fair value hierarchy prioritizes the inputs used to measure fair value into three broad levels:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Level 1 Inputs.* Quoted prices (unadjusted) for identical assets or liabilities in an active market that the Bank can access on the measurement date. An active market for an asset or liability is a market in which the transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*• Level 2 Inputs.* Inputs other than quoted prices within Level 1 that are observable inputs for the asset or liability, either directly or indirectly. If the asset or liability has a specified (contractual) term, a Level 2 input must be observable for substantially the full term of the asset or liability. Level 2 inputs include the following: (i) quoted prices for similar assets or liabilities in active markets, (ii) quoted prices for identical or similar assets or liabilities in markets that are not active, (iii) inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates and yield curves that are observable at commonly quoted intervals and implied volatilities), and (iv) market-corroborated inputs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Level 3 Inputs.* Unobservable inputs for the asset or liability. Valuations are derived from techniques that use significant assumptions not observable in the market, which may include pricing models, discounted cash flow models, or similar techniques.

The Bank reviews its fair value hierarchy classifications on a quarterly basis. Changes in the observability of the valuation inputs may result in a reclassification between fair value hierarchy levels of certain assets or liabilities. The Bank had no transfers of assets or liabilities into or out of Level 3 of the fair value hierarchy during the years ended December 31, 2025, 2024, or 2023.

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The following table summarizes the carrying value, fair value, and fair value hierarchy of the Bank's financial instruments (dollars in millions). The Bank records trading securities, AFS securities, derivative assets, derivative liabilities, financial instruments held under the fair value option, and certain other assets at fair value on a recurring basis, and on occasion certain impaired mortgage loans held for portfolio on a non-recurring basis. The Bank records all other financial assets and liabilities at amortized cost. The fair values do not represent an estimate of the overall market value of the Bank as a going concern, which would take into account future business opportunities and the net profitability of assets and liabilities.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value |
| Financial Instruments | Carrying Value | Level 1 | Level 2 | Level 3 | Netting Adjustment and Cash Collateral<sup>1</sup> | Total |
| Assets |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash and due from banks | $44 | $44 | $— | $— | $— | $44 |
| &nbsp;&nbsp;&nbsp;Interest-bearing deposits | 3726 |  | 3726 |  |  | 3726 |
| &nbsp;&nbsp;&nbsp;Securities purchased under agreements to resell | 17090 |  | 17090 |  |  | 17090 |
| &nbsp;&nbsp;&nbsp;Federal funds sold | 5930 |  | 5930 |  |  | 5930 |
| &nbsp;&nbsp;&nbsp;Trading securities | 6303 |  | 6303 |  |  | 6303 |
| &nbsp;&nbsp;&nbsp;Available-for-sale securities | 27519 |  | 27519 |  |  | 27519 |
| &nbsp;&nbsp;&nbsp;Held-to-maturity securities | 447 |  | 450 | 2 |  | 452 |
| &nbsp;&nbsp;&nbsp;Advances | 110230 |  | 110441 |  |  | 110441 |
| &nbsp;&nbsp;&nbsp;Mortgage loans held for portfolio, net | 14540 |  | 13996 | 38 |  | 14034 |
| &nbsp;&nbsp;&nbsp;Accrued interest receivable | 461 |  | 461 |  |  | 461 |
| &nbsp;&nbsp;&nbsp;Derivative assets, net | 80 |  | 240 |  | (160) | 80 |
| &nbsp;&nbsp;&nbsp;Other assets | 50 | 50 |  |  |  | 50 |
| Liabilities |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | (1147) |  | (1147) |  |  | (1147) |
| &nbsp;&nbsp;&nbsp;Consolidated obligations |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Discount notes<sup>2</sup> | (84620) |  | (84617) |  |  | (84617) |
| &nbsp;&nbsp;&nbsp;&nbsp;Bonds | (89249) |  | (88831) |  |  | (88831) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total consolidated obligations | (173869) |  | (173448) |  |  | (173448) |
| &nbsp;&nbsp;MRCS | (30) | (30) |  |  |  | (30) |
| &nbsp;&nbsp;&nbsp;Accrued interest payable | (589) |  | (589) |  |  | (589) |
| &nbsp;&nbsp;&nbsp;Derivative liabilities, net | (3) |  | (29) |  | 26 | (3) |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent the application of the netting requirements that allow the Bank to net settle positive and negative positions and also cash collateral and the related accrued interest held or placed with the same clearing agent and/or counterparty.

2&nbsp;&nbsp;&nbsp;&nbsp;Includes $17.4 billion of consolidated obligation discount notes recorded under fair value option at December 31, 2025.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table summarizes the carrying value, fair value, and fair value hierarchy of the Bank's financial instruments (dollars in millions):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value |
| Financial Instruments | Carrying Value | Level 1 | Level 2 | Level 3 | Netting Adjustments and Cash Collateral<sup>1</sup> | Total |
| Assets |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash and due from banks | $41 | $41 | $— | $— | $— | $41 |
| &nbsp;&nbsp;&nbsp;Interest-bearing deposits | 4096 |  | 4096 |  |  | 4096 |
| &nbsp;&nbsp;&nbsp;Securities purchased under agreements to resell | 11950 |  | 11950 |  |  | 11950 |
| &nbsp;&nbsp;&nbsp;Federal funds sold | 5175 |  | 5175 |  |  | 5175 |
| &nbsp;&nbsp;&nbsp;Trading securities | 4720 |  | 4720 |  |  | 4720 |
| &nbsp;&nbsp;&nbsp;Available-for-sale securities | 25331 |  | 25331 |  |  | 25331 |
| &nbsp;&nbsp;&nbsp;Held-to-maturity securities | 760 |  | 755 | 2 |  | 757 |
| &nbsp;&nbsp;&nbsp;Advances | 99951 |  | 100040 |  |  | 100040 |
| &nbsp;&nbsp;&nbsp;Mortgage loans held for portfolio, net | 11896 |  | 10940 | 32 |  | 10972 |
| &nbsp;&nbsp;&nbsp;Accrued interest receivable | 400 |  | 400 |  |  | 400 |
| &nbsp;&nbsp;&nbsp;Derivative assets, net | 804 |  | 202 |  | 602 | 804 |
| &nbsp;&nbsp;&nbsp;Other assets | 44 | 44 |  |  |  | 44 |
| Liabilities |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | (1314) |  | (1314) |  |  | (1314) |
| &nbsp;&nbsp;&nbsp;Consolidated obligations |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Discount notes<sup>2</sup> | (64680) |  | (64682) |  |  | (64682) |
| &nbsp;&nbsp;&nbsp;&nbsp;Bonds | (88571) |  | (87778) |  |  | (87778) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total consolidated obligations | (153251) |  | (152460) |  |  | (152460) |
| &nbsp;&nbsp;MRCS | (9) | (9) |  |  |  | (9) |
| &nbsp;&nbsp;&nbsp;Accrued interest payable | (717) |  | (717) |  |  | (717) |
| &nbsp;&nbsp;&nbsp;Derivative liabilities, net | (6) |  | (60) |  | 54 | (6) |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent the application of the netting requirements that allow the Bank to net settle positive and negative positions and also cash collateral and the related accrued interest held or placed with the same clearing agent and/or counterparty.

2&nbsp;&nbsp;&nbsp;&nbsp;Includes $52.3 billion of consolidated obligation discount notes recorded under fair value option at December 31, 2024.

SUMMARY OF VALUATION TECHNIQUES AND PRIMARY INPUTS

The valuation techniques and primary inputs used to develop the measurement of fair value for assets and liabilities that are measured at fair value on a recurring or non-recurring basis on the Statements of Condition are outlined below.

*Trading and AFS Investment Securities.* The Bank's valuation technique incorporates prices from multiple designated third-party pricing vendors, when available. The pricing vendors generally use various proprietary models to price investment securities. The inputs to those models are derived from various sources including, but not limited to, benchmark securities and yields, reported trades, dealer estimates, issuer spreads, bids, offers, and other market-related data. Since many investment securities do not trade on a daily basis, the pricing vendors use available information, as applicable, such as benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing to determine the prices for individual securities. Each pricing vendor has an established process in place to challenge investment valuations, which facilitates resolution of questionable prices identified by the Bank. Periodically, the Bank conducts reviews of its pricing vendors to confirm and further augment its understanding of the vendors' pricing processes, methodologies, and control procedures for investment securities.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The Bank's valuation technique for estimating the fair values of its investment securities first requires the establishment of a median price for each security. All prices that are within a specified tolerance threshold of the median price are included in the cluster of prices that are averaged to compute a default price. All prices that are outside the threshold (outliers) are subject to further analysis (including, but not limited to, comparison to prices provided by an additional third-party valuation service, prices for similar securities, and/or non-binding dealer estimates) to determine if an outlier is a better estimate of fair value. In limited instances, when no prices are available from the designated pricing services, the Bank obtains prices from dealers or uses the purchase price if the investment security is unsettled.

As of December 31, 2025 and 2024, multiple prices were received for the majority of the Bank's trading and AFS investment securities. Based on the Bank's review of the pricing methods and controls employed by the third-party pricing vendors and the relative lack of dispersion among the vendor prices, the Bank believes its final prices are representative of the prices that would have been received if the assets had been sold at the measurement date (i.e., exit prices) and further, that the fair value measurements are classified appropriately in the fair value hierarchy.

*Impaired Mortgage Loans Held for Portfolio.* The fair value of impaired mortgage loans held for portfolio is estimated by obtaining property values from an external pricing vendor. This vendor utilizes multiple pricing models that generally factor in market observable inputs, including actual sales transactions and home price indices. The Bank applies an adjustment to these values to capture certain limitations in the estimation process and takes into consideration estimated selling costs and expected PMI proceeds.

*Derivative Assets and Liabilities.* The fair value of derivatives is generally estimated using standard valuation techniques such as a discounted cash flow analysis and includes variation margin payments for daily settled contracts. In limited instances, fair value estimates for interest-rate related derivatives may be obtained using an external pricing model that utilizes observable market data. The Bank is subject to credit risk in derivatives transactions due to the potential nonperformance of its derivatives counterparties. The use of cleared derivatives is intended to mitigate credit risk exposure because a central counterparty is substituted for individual counterparties and collateral/payments are posted daily, through a clearing agent, for changes in the fair value of cleared derivatives. To mitigate credit risk on uncleared derivatives, the Bank enters into master netting agreements with its counterparties that are fully collateralized with a zero unsecured threshold. The Bank has evaluated the potential for the fair value of its derivatives to be affected by counterparty credit risk and its own credit risk and has determined that no adjustments were significant to the overall fair value measurements.

The fair values of the Bank's derivative assets and derivative liabilities include accrued interest receivable/payable and related cash collateral. The estimated fair values of the accrued interest receivable/payable and cash collateral approximate their carrying values due to their short-term nature. The fair values of derivatives are netted by clearing agent and/or counterparty if the netting requirements are met. If these netted amounts result in a receivable to the Bank, they are classified as an asset and, if classified as a payable to the clearing agent or counterparty, they are classified as a liability.

The Bank's discounted cash flow model utilizes market-observable inputs (inputs that are actively quoted and can be validated to external sources). The Bank uses the following inputs for measuring the fair value of interest-related derivatives:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Discount rate assumption*. The Bank utilizes the federal funds OIS or SOFR OIS curve depending on the terms of the derivative agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Forward interest rate assumption*. The Bank utilizes the swap curve of the instrument's index rate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Volatility assumption*. Market-based expectations of future interest rate volatility implied from current market prices for similar options.

For forward settlement agreements, the Bank utilizes TBA security prices that are determined by coupon class and expected term until settlement. For mortgage loan purchase commitments, the Bank utilizes TBA security prices adjusted for factors such as credit risk and servicing spreads.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

*Other Assets*. These represent grantor trust assets, which are carried at estimated fair value based on quoted market prices as of the last business day of the reporting period.

*Consolidated Obligation Discount Notes Recorded under the Fair Value Option*. The fair value of consolidated obligation discount notes recorded under the fair value option is determined by calculating the present value of the expected future cash flows. The discount rates used in the present value calculations are for consolidated obligations with similar terms. The Bank uses the consolidated obligation curve for measuring the fair value of these consolidated obligations, which is a market-observable curve constructed by the Office of Finance. This curve is constructed using the U.S. Treasury curve as a base curve which is then adjusted by adding indicative spreads obtained largely from market-observable sources.

*Subjectivity of Estimates*. Estimates of the fair value of financial assets and liabilities using the methods previously described are highly subjective and require judgments regarding significant matters, such as the amount and timing of future cash flows, prepayment speed assumptions, expected interest rate volatility, possible distributions of future interest rates used to value options, and the selection of discount rates that appropriately reflect market and credit risks. The use of different assumptions could have a material effect on the fair value estimates.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

FAIR VALUE ON A RECURRING AND NON-RECURRING BASIS

The following table summarizes, for each hierarchy level, the Bank's assets and liabilities that are measured at fair value on the Statements of Condition (dollars in millions):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Level 1 | Level 2 | Level 3 | Netting Adjustments and Cash Collateral<sup>1</sup> | Total |
| Recurring fair value measurements |  |  |  |  |  |
| Assets |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Trading securities |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S. Treasury obligations | $— | $6104 | $— | $— | $6104 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other U.S. obligations |  | 57 |  |  | 57 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations |  | 48 |  |  | 48 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-MBS |  | 94 |  |  | 94 |
| &nbsp;&nbsp;&nbsp;Total trading securities |  | 6303 |  |  | 6303 |
| &nbsp;&nbsp;&nbsp;Available-for-sale securities |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other U.S. obligations |  | 14 |  |  | 14 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations |  | 310 |  |  | 310 |
| &nbsp;&nbsp;&nbsp;&nbsp;State or local housing agency obligations |  | 370 |  |  | 370 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-MBS |  | 19 |  |  | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S. obligations single-family MBS |  | 5707 |  |  | 5707 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE single-family MBS |  | 217 |  |  | 217 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE multifamily MBS |  | 20882 |  |  | 20882 |
| &nbsp;&nbsp;&nbsp;Total available-for-sale securities |  | 27519 |  |  | 27519 |
| &nbsp;&nbsp;&nbsp;Derivative assets, net |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-rate related |  | 240 |  | (160) | 80 |
| &nbsp;&nbsp;Total derivative assets, net |  | 240 |  | (160) | 80 |
| &nbsp;&nbsp;&nbsp;Other assets | 50 |  |  |  | 50 |
| Total recurring assets at fair value | $50 | $34062 | $— | $(160) | $33952 |
| Liabilities |  |  |  |  |  |
| &nbsp;&nbsp;Discount notes<sup>2</sup> | $— | $(17382) | $— | $— | $(17382) |
| &nbsp;&nbsp;&nbsp;Derivative liabilities, net |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-rate related |  | (29) |  | 26 | (3) |
| &nbsp;&nbsp;&nbsp;Total derivative liabilities, net |  | (29) |  | 26 | (3) |
| Total recurring liabilities at fair value | $— | $(17411) | $— | $26 | $(17385) |
| Non-recurring fair value measurements |  |  |  |  |  |
| Assets |  |  |  |  |  |
| &nbsp;&nbsp;Impaired mortgage loans held for portfolio<sup>3</sup> | $— | $— | $6 | $— | $6 |
| Total non-recurring assets at fair value | $— | $— | $6 | $— | $6 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent the application of the netting requirements that allow the Bank to net settle positive and negative positions and also cash collateral and the related accrued interest held or placed with the same clearing agent and/or counterparty.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents financial instruments recorded under the fair value option.

3&nbsp;&nbsp;&nbsp;&nbsp;These assets are subject to fair value adjustments in certain circumstances. The fair value information presented is as of the date the fair value adjustment was recorded during the year ended December 31, 2025.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table summarizes, for each hierarchy level, the Bank's assets and liabilities that are measured at fair value on the Statements of Condition (dollars in millions):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Level 1 | Level 2 | Level 3 | Netting Adjustments and Cash Collateral<sup>1</sup> | Total |
| Recurring fair value measurements |  |  |  |  |  |
| Assets |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Trading securities |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S Treasury obligations | $— | $4508 | $— | $— | $4508 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other U.S. obligations |  | 59 |  |  | 59 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations |  | 47 |  |  | 47 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-MBS |  | 106 |  |  | 106 |
| &nbsp;&nbsp;&nbsp;Total trading securities |  | 4720 |  |  | 4720 |
| &nbsp;&nbsp;&nbsp;Available-for-sale securities |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other U.S. obligations |  | 102 |  |  | 102 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE and TVA obligations |  | 309 |  |  | 309 |
| &nbsp;&nbsp;&nbsp;&nbsp;State or local housing agency obligations |  | 499 |  |  | 499 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-MBS |  | 42 |  |  | 42 |
| &nbsp;&nbsp;&nbsp;&nbsp;U.S. obligations single-family MBS |  | 5200 |  |  | 5200 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE single-family MBS |  | 195 |  |  | 195 |
| &nbsp;&nbsp;&nbsp;&nbsp;GSE multifamily MBS |  | 18984 |  |  | 18984 |
| &nbsp;&nbsp;&nbsp;Total available-for-sale securities |  | 25331 |  |  | 25331 |
| &nbsp;&nbsp;&nbsp;Derivative assets, net |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-rate related |  | 201 |  | 602 | 803 |
| &nbsp;&nbsp;&nbsp;&nbsp;Forward settlement agreements (TBAs) |  | 1 |  |  | 1 |
| &nbsp;&nbsp;&nbsp;Total derivative assets, net |  | 202 |  | 602 | 804 |
| &nbsp;&nbsp;&nbsp;Other assets | 44 |  |  |  | 44 |
| Total recurring assets at fair value | $44 | $30253 | $— | $602 | $30899 |
| Liabilities |  |  |  |  |  |
| &nbsp;&nbsp;Discount Notes<sup>2</sup> | $— | $(52349) | $— | $— | $(52349) |
| &nbsp;&nbsp;&nbsp;Derivative liabilities, net |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-rate related |  | (60) |  | 54 | (6) |
| &nbsp;&nbsp;&nbsp;Total derivative liabilities, net |  | (60) |  | 54 | (6) |
| Total recurring liabilities at fair value | $— | $(52409) | $— | $54 | $(52355) |
| Non-recurring fair value measurements |  |  |  |  |  |
| Assets |  |  |  |  |  |
| &nbsp;&nbsp;Impaired mortgage loans held for portfolio<sup>3</sup> | $— | $— | $5 | $— | $5 |
| Total non-recurring assets at fair value | $— | $— | $5 | $— | $5 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent the application of the netting requirements that allow the Bank to net settle positive and negative positions and also cash collateral and the related accrued interest held or placed with the same clearing agent and/or counterparty.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents financial instruments recorded under the fair value option.

3&nbsp;&nbsp;&nbsp;&nbsp;These assets are subject to fair value adjustments in certain circumstances. The fair value information presented is as of the date the fair value adjustment was recorded during the year ended December 31, 2024.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

FAIR VALUE OPTION

The fair value option provides an irrevocable option to elect fair value as an alternative measurement for selected financial assets, financial liabilities, and unrecognized firm commitments. It requires entities to display the fair value of those assets and liabilities for which it has chosen to use fair value on the face of the Statements of Condition. Fair value is used for both the initial and subsequent measurement of the designated assets, liabilities, and commitments, with the changes in fair value recognized in net income. These fair value elections are made primarily in an effort to mitigate the potential income statement volatility that can arise when an economic derivative is adjusted for changes in fair value but the related hedged item is not.

For financial instruments recorded under the fair value option, the related contractual interest income, interest expense, and the discount amortization on fair value option discount notes are recorded as part of net interest income on the Statements of Income. The remaining changes are recorded as "Net gains (losses) on financial instruments held under fair value option" on the Statements of Income.

For the years ended December 31, 2025, 2024, and 2023, the Bank recorded net gains of $12 million, net losses of $31 million, and net losses of $92 million on financial instruments held under fair value option (i.e., discount notes). The Bank determined no credit risk adjustments for nonperformance were necessary. In determining that no credit risk adjustments were necessary, the Bank considered the following factors:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank is a federally chartered GSE, and as a result of this status, the Bank's consolidated obligations have historically received the same credit rating as the government bond credit rating of the United States, even though they are not obligations of the United States and are not guaranteed by the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank is jointly and severally liable with the other FHLBanks for the payment of principal and interest on all consolidated obligations of the FHLBanks.

The following table summarizes the difference between the unpaid principal balance and fair value of outstanding instruments for which the fair value option has been elected (dollars in millions):

---

| | | | |
|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Unpaid Principal Balance | Fair Value | Fair Value Over (Under) Unpaid Principal |
| Discount Notes | $17504 | $17382 | $(122) |

---

---

| | | | |
|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Unpaid Principal Balance | Fair Value | Fair Value Over (Under) Unpaid Principal |
| Discount Notes | $52848 | $52349 | $(499) |

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Note 13 — Commitments and Contingencies** 

The following table summarizes additional off-balance sheet commitments for the Bank (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2024 |
| | Expire <br>within one year | Expire <br>after one year | Total | Total |
| Standby letters of credit<sup>1,2</sup> | $18145 | $118 | $18263 | $20150 |
| Standby bond purchase agreements<sup>2</sup> | 179 | 1070 | 1249 | 1024 |
| Commitments to purchase mortgage loans | 106 |  | 106 | 101 |
| Commitments to issue bonds<sup>3</sup> | 1000 |  | 1000 | 665 |
| Commitments to issue discount notes<sup>3</sup> | 3060 |  | 3060 |  |
| Commitments to fund advances<sup>2,4</sup> | 151 |  | 151 | 227 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Excludes commitments to issue standby letters of credit, when applicable. At both December 31, 2025 and 2024, the Bank had no commitments to issue standby letters of credit.

2&nbsp;&nbsp;&nbsp;&nbsp;The Bank has deemed it unnecessary to record any liability for credit losses on these agreements at December 31, 2025 and 2024, based on its credit extension and collateral policies.

3&nbsp;&nbsp;&nbsp;&nbsp;The Bank enters into commitments to issue consolidated obligations in the normal course of its business, that generally settle within 30 calendar days.

4&nbsp;&nbsp;&nbsp;&nbsp;The Bank enters into commitments to fund additional advances up to 24 months in the future.

*Standby Letters of Credit*. The Bank issues standby letters of credit on behalf of its members to support certain obligations of the members to third-party beneficiaries. Standby letters of credit may be offered to assist members and non-member housing associates in facilitating residential housing finance, community lending, and asset-liability management, and to provide liquidity. In particular, members often use standby letters of credit as collateral for deposits from federal and state government agencies. Standby letters of credit are executed with members for a fee. If the Bank is required to make payment for a beneficiary's draw, the member either reimburses the Bank for the amount drawn or, subject to the Bank's discretion, the amount drawn may be converted into a collateralized advance to the member. The maturities of standby letters of credit outstanding at December 31, 2025 are currently no later than 2038. The carrying values of guarantees related to standby letters of credit are recorded in "Other liabilities" on the Statements of Condition and amounted to $7 million at both December 31, 2025 and 2024.

The Bank monitors the creditworthiness of its members and non-member housing associates that have standby letters of credit. The Bank has established parameters for the measurement, review, classification, and monitoring of credit risk related to these standby letters of credit. All standby letters of credit, similar to advances, are fully collateralized at the time of issuance and subject to member borrowing limits as established by the Bank.

*Standby Bond Purchase Agreements*. The Bank has entered into standby bond purchase agreements with state housing finance agencies within its district pursuant to which, for a fee, it agrees to serve as a standby liquidity provider if required, to purchase and hold the bonds until the designated marketing agent can find a suitable investor or the state housing finance agency repurchases the bonds according to a schedule established by the agreement. Each standby bond purchase agreement includes the provisions under which the Bank would be required to purchase the bonds and typically allows the Bank to terminate the agreement upon the occurrence of a default event of the issuer. At December 31, 2025, the Bank had standby bond purchase agreements with eight state housing finance agencies. The maturities of standby bond purchase agreements outstanding at December 31, 2025 are currently no later than 2030. During the years ended December 31, 2025, 2024, and 2023, the Bank was not required to purchase any bonds under these agreements.

*Commitments to Purchase Mortgage Loans*. The Bank enters into commitments that unconditionally obligate it to purchase mortgage loans from its members. These commitments are considered derivatives and their estimated fair value at December 31, 2025 and 2024 is reported in "<u>[Note 7 — Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205)</u>" as mortgage loan purchase commitments.

*Joint and Several Liability*. The FHLBanks have joint and several liability for all consolidated obligations issued. Accordingly, if an FHLBank were unable to repay any consolidated obligation for which it is the primary obligor, each of the other FHLBanks could be called upon by the Finance Agency to repay all or part of such obligations. No FHLBank has ever been asked or required to repay the principal or interest on any consolidated obligation on behalf of another FHLBank. At December 31, 2025 and 2024, the total par value of outstanding consolidated obligations issued on behalf of other FHLBanks for which the Bank is jointly and severally liable was $977.4 billion and $1,039.2 billion.

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*Other Commitments*. For each MPF master commitment, the Bank's potential loss exposure prior to the PFI's credit enhancement obligation is estimated and tracked in a FLA. For absorbing certain losses in excess of the FLA, PFIs are paid a credit enhancement fee, a portion of which may be performance-based. To the extent the Bank experiences losses under the FLA, it may be able to recapture performance-based credit enhancement fees paid to the PFI to offset these losses. The FLA balance for all MPF master commitments with a PFI credit enhancement obligation was $222 million and $197 million at December 31, 2025 and 2024.

*Pledged Collateral.* The Bank pledged securities, as collateral, related to derivatives. See "<u>[Note 7 — Derivatives and Hedging Activities](#i6940522039644a7690f9aab973fdec20_205)</u>" for additional information about the Bank's pledged collateral.

*Legal Proceedings*. The Bank is subject to various pending legal proceedings arising in the normal course of business. The Bank is not currently aware of any pending or threatened legal proceedings to which it is a party that it believes could have a material impact on its financial condition, results of operations, or cash flows.

**Note 14 — Activities with Stockholders** 

The Bank is a cooperative. This means the Bank is owned by its customers, whom the Bank calls members. As a condition of membership in the Bank, all members must purchase and maintain membership capital stock based on a percentage of their total assets, subject to a minimum and maximum amount, as of the preceding December 31<sup>st</sup>. Each member is also required to purchase and maintain activity-based capital stock to support certain business activities with the Bank. All transactions with stockholders are entered into in the ordinary course of business. Refer to "<u>[Note 11 — Capital](#i6940522039644a7690f9aab973fdec20_220)</u>" for more information on our capital stock requirements.

TRANSACTIONS WITH DIRECTORS' FINANCIAL INSTITUTIONS

In the normal course of business, the Bank extends credit to its members whose directors and officers serve as Bank directors (Directors' Financial Institutions). Finance Agency regulations require that transactions with Directors' Financial Institutions be made on the same terms and conditions as those with any other member.

The following table summarizes the Bank's outstanding transactions with Directors' Financial Institutions (dollars in millions):

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2024 | December 31, 2024 |
| | Amount | % of Total | Amount | % of Total |
| Advances | $667 | 1 | $1127 | 1 |
| Mortgage loans | 606 | 4 | 190 | 2 |
| Deposits | 15 | 1 | 12 | 1 |
| Capital stock | 65 | 1 | 78 | 1 |

---

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

BUSINESS CONCENTRATIONS

The Bank considers itself to have business concentrations with stockholders owning 10 percent or more of its total capital stock outstanding (including MRCS). At December 31, 2025 and 2024, the Bank had the following business concentrations with stockholders (dollars in millions):

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 | December 31, 2025 |
| | Capital Stock | Capital Stock | | Mortgage | Interest |
| Stockholder | Amount | % of Total<sup>1</sup> | Advances | Loans | Income<sup>2</sup> |
| Athene Annuity and Life Company<sup>3</sup> | $1057 | 16 | $23271 | $— | $863 |
| Wells Fargo, N.A.<sup>4</sup> | 741 | 11 | 16000 | 5 | 348 |
| Superior Guaranty Insurance Company<sup>5</sup> | 4 |  |  | 93 |  |
| Total | $1802 | 27 | $39271 | $98 | $1211 |

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Capital Stock | Capital Stock | | Interest |
| Stockholder | Amount | % of Total<sup>1</sup> | Advances | Income<sup>2</sup> |
| Athene Annuity and Life Company<sup>3</sup> | $711 | 12 | $15571 | $473 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to applicable Finance Agency regulations, the Bank's voting structure limits the voting rights of these stockholders and other members holding a significant amount of the Bank's capital stock.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents interest income earned on advances during the years ended December 31, 2025 and 2024. Interest income on mortgage loans is excluded from these tables as this interest relates to the borrower, not to the stockholder.

3&nbsp;&nbsp;&nbsp;&nbsp;Athene Annuity and Life Company had no standby letters of credit outstanding as of December 31, 2025 and 2024.

4&nbsp;&nbsp;&nbsp;&nbsp;Wells Fargo Bank, N.A. had standby letters of credit outstanding totaling $10.9 billion as of December 31, 2025, which generated fee income of $13 million during the year ended December 31, 2025.

5&nbsp;&nbsp;&nbsp;&nbsp;Superior Guaranty Insurance Company is an affiliate of Wells Fargo Bank, N.A. and had no standby letters of credit outstanding as of December 31, 2025.

The Bank's concentrations also include stockholders with revenues in excess of 10 percent of the Bank's total revenue, which includes interest income and non-interest income. For the year ended December 31, 2025, the Bank had no stockholders with revenues in excess of 10 percent of the Bank's total revenue. The Bank had one member and related affiliate with revenues of $1.0 billion and $1.7 billion for the years ended December 31, 2024 and 2023.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Note 15 — Activities with Other FHLBanks** 

*Overnight Funds*. The Bank may lend or borrow unsecured overnight funds to or from other FHLBanks. All such transactions are at current market rates. The following table summarizes loan activity to other FHLBanks during the years ended December 31, 2025, 2024, and 2023 (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| Other FHLBank | Beginning<br>Balance | Loans | Principal<br>Repayment | Ending<br>Balance |
| 2025 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Boston | $— | $300 | $(300) | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Chicago |  | 10 | (10) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Indianapolis |  | 500 | (500) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;San Francisco |  | 850 | (850) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Topeka |  | 10 | (10) |  |
|  | $— | $1670 | $(1670) | $— |
| 2024 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Boston | $— | $200 | $(200) | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Chicago |  | 5 | (5) |  |
|  | $— | $205 | $(205) | $— |
| 2023 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Chicago | $— | $2005 | $(2005) | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;New York |  | 500 | (500) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;San Francisco |  | 2655 | (2655) |  |
|  | $— | $5160 | $(5160) | $— |

---

The following table summarizes borrowing activity from other FHLBanks during the years ended December 31, 2025, 2024, and 2023 (dollars in millions):

---

| | | | | |
|:---|:---|:---|:---|:---|
| Other FHLBank | Beginning<br>Balance | Borrowing | Principal<br>Payment | Ending<br>Balance |
| 2025 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Atlanta | $— | $200 | $(200) | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Chicago |  | 300 | (300) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cincinnati |  | 550 | (550) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;New York |  | 700 | (700) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;San Francisco |  | 500 | (500) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Topeka |  | 450 | (450) |  |
|  | $— | $2700 | $(2700) | $— |
| 2024 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Chicago | $— | $2000 | $(2000) | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Cincinnati |  | 500 | (500) |  |
|  | $— | $2500 | $(2500) | $— |
| 2023 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Boston | $— | $450 | $(450) | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Cincinnati |  | 750 | (750) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;San Francisco |  | 500 | (500) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Topeka |  | 565 | (565) |  |
|  | $— | $2265 | $(2265) | $— |

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For the years ended December 31, 2025, 2024, and 2023, the interest income and expense related to these transactions was immaterial.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

*MPF Program.* The Bank pays fees to the FHLBank of Chicago for providing MPF program services. For the years ended December 31, 2025, 2024, and 2023, the Bank paid fees of $10 million, $8 million, and $6 million to the FHLBank of Chicago. In order to facilitate these payments, the Bank maintained interest-bearing deposits with the FHLBank of Chicago, which totaled $6 million and $1 million at December 31, 2025 and 2024.

**<u>ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE</u>**

None.

**<u>ITEM 9A. CONTROLS AND PROCEDURES</u>**

**Evaluation of Disclosure Controls and Procedures** 

Management is responsible for establishing and maintaining disclosure controls and procedures designed to ensure that information required to be disclosed in reports we file or submit under the Exchange Act is (i) recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms; and (ii) accumulated and communicated to our management, including our President and CEO, and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Management, with the participation of our President and CEO, and CFO, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the annual period covered by this report. Based on that evaluation, our President and CEO, and CFO have concluded that our disclosure controls and procedures were effective as of December 31, 2025.

**Report of Management on Internal Control over Financial Reporting**

Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are made only in accordance with authorizations of management and directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025, based on the framework established in "Internal Control - Integrated Framework" (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on its assessment, management determined that our internal control over financial reporting was effective as of December 31, 2025. Additionally, the effectiveness of our internal control over financial reporting as of December 31, 2025, has been audited by PwC, our independent registered public accounting firm. Refer to "<u>[Item 8. Financial Statements and Supplementary Data — Report of Independent Registered Public Accounting Firm](#i6940522039644a7690f9aab973fdec20_142)</u>" for their audit report.

**Changes in Internal Control over Financial Reporting**

During the quarter ended December 31, 2025, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**<u>ITEM 9B. OTHER INFORMATION</u>**

None.

**<u>ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS</u>**

Not applicable.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**<u>PART III</u>** 

**<u>ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE</u>**

**Directors**

The Board of Directors is responsible for monitoring our compliance with Finance Agency regulations and establishing policies and programs that carry out our mission. The Board of Directors adopts, reviews, and oversees the implementation of policies governing our advance, mortgage loan, investment, and funding activities. Additionally, the Board of Directors adopts, reviews, and oversees the implementation of policies that are designed to manage our exposure to various risks, including interest rate, liquidity, credit, operational, model, information security, legal, regulatory and compliance, strategic, and reputational, as well as capital adequacy.

Our Board is comprised of Member Directors elected by our member institutions on a state-by-state basis and Independent Directors elected by all of our members. Our Board includes thirteen Member Directors and nine Independent Directors, two of whom serve as public interest directors. Under the FHLBank Act, the only matters submitted to shareholders for votes are (i) the annual election of our Directors and (ii) any proposed agreement to merge with one or more FHLBanks. Finance Agency regulations generally require all of our Directors to be elected by our members. In the event of a vacancy, Finance Agency regulations require the Board of Directors to elect a director to serve the remaining term. No member of management may serve as a director of an FHLBank.

Pursuant to the passage of the Housing Act, both Member and Independent Directors serve four-year terms. If any person has been elected to three consecutive full terms as a Member or Independent Director of our Board of Directors, the individual is not eligible for election to a Member or Independent Directorship for a term which begins earlier than two years after the expiration of the last expiring four-year term.

Member Directorships are allocated by the Finance Agency to the 13 states in our district and a member institution is eligible to participate in the election for the state in which it is located. Candidates for Member Directorships are not nominated by the Board. Under the FHLBank Act, Member Directors are nominated by the members eligible to participate in the election in the relevant state. A member is entitled to cast, for each applicable Member Directorship, one vote for each share of capital stock that the member is required to hold as of the record date for voting, subject to a statutory limitation, equal to the average number of shares of our capital stock that were required to be held by all members in that state as of the record date for voting.

Member Directors are required, by statute and regulation, to meet certain eligibility requirements to serve as a director. To qualify as a Member Director an individual must (i) be an officer or director of a member institution in compliance with the minimum capital requirements established by its regulator and located in the state in which there is an open directorship and (ii) be a U.S. citizen. We are not permitted to establish additional qualifications to define eligibility criteria for Member Directors or nominees. Because of the structure of FHLBank Member Director nominations and elections, we may not know what factors our member institutions considered in selecting Member Director nominees or electing Member Directors.

Independent Directors are nominated by our Board of Directors after consultation with our Advisory Council, and then voted upon by all members within our 13 state district. For each Independent Directorship, a member is entitled to cast the same number of votes as it would for a Member Directorship.

In order to be eligible to serve as an Independent Director on our Board, an individual must (i) be a U.S. citizen and (ii) maintain a principal residence in a state in our district (or own or lease a residence in the district and be employed in the district). In addition, the individual may not be an officer of any FHLBank or a director, officer, or employee of any member institution or of any recipient of our advances. By regulation, we are required to have at least two public interest Independent Directors, each of whom must have more than four years of personal experience in representing consumer or community interests in banking services, credit needs, housing, or financial consumer protection. Each Independent Director, other than a public interest Independent Director, must have knowledge of, or experience in, financial management, auditing or accounting, risk management practices, derivatives, project development, organizational management, or the law.

On an annual basis, our Board of Directors performs an assessment of the directors' backgrounds, expertise, and qualifications against the skills and qualifications it desires on the Board of Directors. Furthermore, each director annually certifies that he/she continues to meet all applicable statutory and regulatory eligibility and qualification requirements. In connection with the election or appointment of Independent Directors, the Independent Director completes an application to serve on the Board of Directors. As a result of the assessment and as of the filing date of this Form 10-K, nothing has come to the attention of the Board of Directors or management to indicate that any of the current directors do not continue to possess the necessary experience, qualifications, attributes, or skills, as described in each director's biography.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

Information regarding our current directors and executive officers is provided in the following sections. There are no family relationships among our directors or executive officers. The table below shows membership information for our Board of Directors at February 28, 2026:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | | | Expiration of | |
| | | | | Current Term As | |
| | | Member or | | Director as of | Board |
| Director | Age | Independent | Director Since | December 31 | Committees |
| Karl A. Bollingberg (chair) | 63 | Member | January 1, 2019 | 2026 | a |
| John A. Klebba (vice chair) | 69 | Member | January 1, 2018 | 2029 | a |
| Ruth B. Bennett | 73 | Independent | June 1, 2015 | 2028 | b, d, h |
| Cleon P. Butterfield \* | 71 | Independent | January 1, 2020 | 2027 | b, d, h |
| Kim R. DeVore | 55 | Member | January 1, 2023 | 2026 | d, e, h |
| Edward A. Garding | 76 | Independent | August 30, 2021 | 2027 | b, d, h |
| Amy K. Johnson | 60 | Independent | January 1, 2020 | 2027 | a, d, f, g |
| Jon M. Jones | 64 | Member | January 1, 2021 | 2028 | a, b, f |
| Joe R. Kesler | 70 | Member | March 9, 2018 | 2027 | b, c |
| Wan-Chong Kung | 65 | Independent | January 19, 2022 | 2026 | a, g, h |
| Russell J. Lau | 73 | Member | January 1, 2022 | 2029 | b, c, d |
| Lauren M. MacVay | 57 | Member | January 1, 2018 | 2029 | a, c, d, e |
| Elsie M. Meeks \* | 72 | Independent | January 1, 2015 | 2026 | a, b, d, f |
| Peter J. Mehlhaff | 69 | Member | January 1, 2026 | 2029 | c, g |
| Jason A. Meyerhoeffer | 59 | Member | June 25, 2019 | 2026 | a, c, e |
| Siva G. Narendra | 54 | Independent | January 1, 2022 | 2029 | c, g |
| Carol K. Nelson | 69 | Independent | January 1, 2021 | 2028 | a, f, g |
| Matt C. Packard | 71 | Member | January 1, 2026 | 2029 | e, f |
| Jeff L. Plagge | 70 | Member | January 1, 2024 | 2027 | g, h |
| Lisa A. Stange | 61 | Independent | January 1, 2024 | 2027 | c, e |
| Matt C. Stephenson | 49 | Member | January 1, 2025 | 2028 | e, f |
| Robert J. Vogel | 74 | Member | January 1, 2024 | 2027 | e, h |

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a) &nbsp;&nbsp;&nbsp;&nbsp;Executive and Governance Committee

b)&nbsp;&nbsp;&nbsp;&nbsp;Audit Committee

c)&nbsp;&nbsp;&nbsp;&nbsp;Risk and Compliance Committee

d)&nbsp;&nbsp;&nbsp;&nbsp;Housing and Community Investment Committee

e) &nbsp;&nbsp;&nbsp;&nbsp;Member Committee

f)&nbsp;&nbsp;&nbsp;&nbsp;Compensation Committee

g)&nbsp;&nbsp;&nbsp;&nbsp;Technology Committee

h)&nbsp;&nbsp;&nbsp;&nbsp;Finance Committee

\*&nbsp;&nbsp;&nbsp;&nbsp;Public Interest Independent Director

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following describes the principal occupation, business experience, qualifications, and skills, among other matters of the 22 directors who currently serve on our Board of Directors. Except as otherwise indicated, each Director has been engaged in the principal occupation indicated for at least the past five years.

*Karl A. Bollingberg,* the Board's chair, has served as a director for Cornerstone Bank in Fargo, North Dakota, since June 2022. Mr. Bollingberg retired from Alerus Financial in July 2022. While at Alerus Financial, Mr. Bollingberg served as loan participation advisor from 2018 to 2022, and in various other roles, including director of lending, director of banking services, and regional president, since 1987. Mr. Bollingberg is active in a number of civic organizations including advisory board member and chair for the Bank of North Dakota. In addition, he previously served as a member and chair for the Regional Economic Development Corporation, as a member and past chair of the Regional Airport Authority, and was campaign chairperson for the Community Violence and Intervention Center Shelter Project. He earned his bachelor's degree in agricultural economics from North Dakota State University and completed Louisiana State University School of Banking in 2000. Mr. Bollingberg's position as a director of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors. He currently serves as the chair of the Executive and Governance Committee.

*John A. Klebba,* the Board's vice chair*,* has been the CEO and chairman of the board of Legends Bank in Linn, Missouri, and its holding company, Linn Holding Company, since April 2018. He previously served as the president, CEO, and chairman of the board of Legends Bank and its holding company, Linn Holding Company, since February 2004. Mr. Klebba has been with Legends Bank since 1991. Prior to that, he was a partner in the Kansas City office of the law firm of Lewis Rice and Fingersh, where his practice concentrated on corporate and banking law. Mr. Klebba is a former member of the board of the American Bankers Association and a former chairman of the Missouri Bankers Association. He is currently the chairman of the Board of Regents of the State Technical College of Missouri, a member of the board of the Missouri Higher Education Savings Program, as well as a board member of a number of charitable organizations. Mr. Klebba holds both a Juris Doctor degree and MBA degree from the University of Notre Dame. Mr. Klebba's position as an officer of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors. He currently serves as the vice chair of the Executive and Governance Committee.

*Ruth B. Bennett* has served as principal of Bennett Oregon Investments LLC, a real estate brokerage firm and property development company in Oregon and Washington, since 2008. In her role at Bennett Oregon Investments LLC, she develops, builds, and manages affordable housing. From 1973 to 2007, she served in various capacities at the Bonneville Power

Housing, Pacific Northern Environmental, First Independent Bank, the regional Columbia-Willamette YMCA, and Pacific Health SW Medical Center where she was a hospital board chair for three years. Ms. Bennett was elected to the board of the Seattle Bank in 2014 and served on the Seattle Bank's board until the merger with the Bank in 2015. Ms. Bennett's experience, as indicated by her background, support her qualifications to serve as an Independent Director on our Board of Directors.

*Cleon P. Butterfield* retired as senior vice president and CFO for the Utah Housing Corporation in June 2024, a position he held since 2001. Mr. Butterfield joined the Utah Housing Corporation in 1979 and held various leadership capacities during his tenure including treasurer, director of operations, and director of program development among others. Mr. Butterfield is a licensed CPA. Mr. Butterfield has served on multiple affordable housing councils and committees. He is also a former member of the State of Utah Alternative Dispute Resolution Council. Additionally, he is a guest lecturer teaching about how low-income housing tax credits and tax-exempt bond financing produce a viable solution for low-income housing needs. Mr. Butterfield's experience, as indicated by his background, support his qualifications to serve as a Public Interest Independent Director on our Board of Directors.

*Kim R. DeVore* has served as the president and CEO of Jonah Bank of Wyoming in Casper, Wyoming since 2020. Ms. DeVore previously served as CFO of Jonah Bank of Wyoming, since its inception in 2006. Ms. DeVore's previous banking responsibilities include all operations roles, cash management, and commercial lending. Ms. DeVore is active in community organizations including the Two Fly Foundation, The Lyric, and the Central Wyoming Boys & Girls Club. She led the development of WyoTowne at AmeriTowne; a program to teach children about civic and financial responsibility along with America's free enterprise system. Ms. DeVore was appointed by the Governor of Wyoming and served eight years on the Wyoming Business Council Board of Directors, the state's economic development agency. Ms. DeVore was the president of the National Community Depository Institution Advisory Council (CDIAC) in 2025. Ms. DeVore represented the 10th District Kansas City Federal Reserve Bank on the CDIAC to advise the Federal Reserve System's Board of Governors. Ms. DeVore's position as an officer of a member institution and her experience, as indicated by her background, support her qualifications to serve on our Board of Directors. She currently serves as vice chair of the Member Committee.

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*Edward A. Garding* retired as president and CEO of First Interstate BancSystems, in Billings, Montana in 2016. Mr. Garding spent more than 40 years with First Interstate BancSystems during which he held various management positions including chief credit officer, CRO, COO and corporate and government relations officer. Mr. Garding has served on several banking industry boards including serving as chairman of the Wyoming Bankers Association, Pacific Coast Banking School Board, and Montana Bankers Association. He was also a member of the Fannie Mae Western Region Advisory Board. He served as the Interim Dean of the College of Business at Montana State University Billings, a position he held during the 2018 to 2023 fiscal years, and is now retired from that position. Mr. Garding's experience, as indicated by his background, support his qualifications to serve as an Independent Director on our Board of Directors. He currently serves as vice chair of the Finance Committee.

*Amy K. Johnson* has served as a member of the Board of Trustees for Parnassus Funds since 2022. Ms. Johnson retired from her position as global head of operations for Columbia Threadneedle Investments, the investment management division of Ameriprise Financial, Inc. in Minneapolis, Minnesota, in June 2019, a position she held since April 2016. Ms. Johnson previously served in several positions at Columbia Threadneedle Investments and its predecessors and affiliates since 2001. Her most recent roles included president of Ameriprise Trust Company from November 2006 to April 2017 and Columbia Threadneedle Investments COO - North America from May 2010 to April 2016. Ms. Johnson was a board member of Friends of Ngong Road from 2009 through 2024 and rejoined the board in 2026. Based in Minneapolis, Minnesota, its mission is equipping Nairobi's youth with education, support, and pathways to employment. Ms. Johnson's experience, as indicated by her background, support her qualifications to serve as an Independent Director on our Board of Directors. She currently serves as chair of the Compensation Committee and vice chair of the Housing and Community Investment Committee.

*Jon M. Jones* has served as president and CEO and member of the board of directors of Twin City Bank in Longview, Washington since September of 2025. He previously served as vice president and community advisor for Washington Trust Bank in Spokane, Washington from December 2024 to September 2025. Prior to that, Mr. Jones was the president and CEO of Washington Business Bank in Olympia, Washington from 2007 to November 2024. Before joining Washington Business Bank, Mr. Jones worked for his own company, Jones Financial Strategies, as a bank consultant and commodities trader. He previously worked for Venture Bank in Olympia, Washington in various roles for 15 years. Mr. Jones is a member and past chairman of the board of the Washington Bankers Association. Additionally, he is a past chairman of both the Thurston County Chamber of Commerce and the South Sound YMCA. Mr. Jones graduated from the University of Northern Iowa with a BA in Finance and graduated from the Pacific Coast Banking School at the University of Washington. Mr. Jones' position as an officer of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors. He currently serves as chair of the Audit Committee.

*Joe R. Kesler* has served as a director of First Montana Bank in Missoula, Montana, and its holding company, First National Bancorp, Inc., since 2005. Mr. Kesler served as the president and CEO of First Montana Bank from 2005 to February 2018 and has over 40 years of experience in the banking industry. Mr. Kesler has served in various community leadership roles, including president of the Chamber of Commerce, director of a small business incubator, director of business development corporations, director of state banking trade associations, member of service clubs such as Rotary, and leader or director for community nonprofits like symphony boards and churches. Mr. Kesler's position as a director of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors.

*Wan-Chong Kung* has served as a trustee of Securian Funds Trust since October 2022. Ms. Kung has served as an independent trustee on a multiple series trust with US Bancorp Global Fund Services, where she has been a member of the audit and governance committees, since 2020. Ms. Kung served as the senior vice president, senior fund manager, head of rates strategy at Nuveen Asset Management from 2011 to 2019. Prior to that, Ms. Kung spent 12 years serving as a managing director and fund manager at US Bancorp Asset Management. Ms. Kung is a CFA and holds an MBA in management information systems from the University of Minnesota. Ms. Kung's experience, as indicated by her background, support her qualifications to serve as an Independent Director on our Board of Directors. She currently serves as chair of the Finance Committee.

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*Russell J. Lau* has served as the chairman and CEO of Finance Factors Limited in Honolulu, Hawaii, since 1998. Mr. Lau has served as the chairman, president, and CEO of Finance Enterprises, Ltd., the parent company, since 2004. In connection with his service with Finance Enterprises, he is the chairman and CEO of Finance Insurance, Ltd. and chairman and CEO of Finance Realty, Ltd., and Waipono Inc. Mr. Lau previously served on the board of the Seattle Bank from 2005 to 2015. Mr. Lau is a member and former and current president of the Hawaii Bankers Association Executive Committee and has held leadership roles with numerous civic and professional organizations. Mr. Lau was also a member of the FDIC's Minority Depository Institutions Subcommitteee to the Advisory Committee on Community Bank from May 2022 to November 2024. Mr. Lau has a bachelor's and master's degree in finance from the University of Puget Sound and the University of Oregon, respectively. He also graduated from Pacific Coast Banking School at the University of Washington. Mr. Lau's position as an officer of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors. He currently serves as vice chair of the Audit Committee.

*Lauren M. MacVay* is currently the CEO of True North Federal Credit Union in Juneau, Alaska, a position she has held since 2004. Ms. MacVay has over 30 years of banking experience. Prior to her current role, she held various leadership and management roles after joining True North Federal Credit Union in 1995. Before relocating to Alaska and beginning her banking career, Ms. MacVay was a practicing attorney in Pennsylvania for several years. Ms. MacVay has held numerous board positions and currently serves on the board of directors of the Alaska Credit Union League. Ms. MacVay's position as an officer of a member institution and her experience, as indicated by her background, support her qualifications to serve on our Board of Directors. She currently serves as chair of the Risk and Compliance Committee.

*Elsie M. Meeks* is currently serving on the board of the Native American Agricultural Fund. She previously served as state director of the United States Department of Agriculture (USDA) in South Dakota from July of 2009 to 2015. Prior to joining the USDA, Ms. Meeks was the president and CEO of First Nations Oweesta Corporation. She was active in the development and management of Lakota Funds in South Dakota and has served as its board chair since 2015. Ms. Meeks served on the U.S. Commission on Civil Rights, completing a six-year term. She has served as a director or council member of several national Native American organizations, including a past director of the Northwest Area Foundation based in St. Paul, Minnesota. Ms. Meeks' experience, as indicated by her background, support her qualifications to serve as a Public Interest Independent Director on our Board of Directors. She currently serves as chair of the Housing and Community Investment Committee.

*Peter J. Mehlhaff* has served as president, CEO and chairman of Great Plains Bank in Aberdeen, South Dakota, and chairman of its holding company Great Plains Bank Corporation, since 1990. Prior to joining Great Plains Bank, Mr. Mehlhaff worked from 1979 to 1990 for U.S. Bank and Wells Fargo Bank, in Aberdeen, South Dakota and several Minnesota communities, serving in a variety of leadership roles, including vice president and business banking lender/manager and correspondent bank officer. Mr. Mehlhaff serves as chair and director of the South Dakota Bankers Association, and former chairman of Presentation College Board of Trustees, president of the Aberdeen Catholic Foundation, adjunct faculty for local college programs, Northern State University Business School Advisory Committee, and Investment Committee member of the Catholic Community Foundation for Eastern South Dakota. Mr. Mehlhaff's position as an officer of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors.

*Jason A. Meyerhoeffer* has served as president and CEO of First Federal Savings Bank of Twin Falls in Twin Falls, Idaho since 2017. Prior to his current position, Mr. Meyerhoeffer held various leadership roles at First Federal Savings Bank of Twin Falls since 1996, including serving as executive vice president and chief lending officer from 2002 to 2016. Mr. Meyerhoeffer's banking career began in 1995 as a regional credit officer with West One Bank N.A. Mr. Meyerhoeffer has served as director of several business development corporations and state banking trade associations. Mr. Meyerhoeffer's position as an officer of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors. He currently serves as chair of the Member Committee.

*Siva G. Narendra* is CEO of tyfone, Inc., a company in Portland, Oregon he co-founded in 2004. Dr. Narendra has served as its CEO since 2011. Dr. Narendra is also the CEO of Payfinia, Inc. Dr. Narendra is an inventor with more than 100 patents. Prior to becoming an entrepreneur, Dr. Narendra was a Senior Staff Scientist at Intel's Corporate Technology Group where his contributions led to the issuance of 75 patents. Dr. Narendra is a published author and has more than 60 peer-reviewed papers. In addition to serving on the boards of the two technology companies he co-founded, tyfone, Inc. and iCashe, Dr. Narendra is on the board of OnPoint Community Credit Union Foundation and was a board member at OnPoint Community Credit Union from 2017 to 2020. Dr. Narendra holds a Ph.D. in Electrical Engineering and Computer Science from the Massachusetts Institute of Technology in Cambridge, Massachusetts. Dr. Narendra's experience, as indicated by his background, support his qualifications to serve as an Independent Director on our Board of Directors. He currently serves as vice chair of the Risk and Compliance Committee.

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*Carol K. Nelson* served as president and CEO of Monzo, Inc. from 2021 to 2022. Ms. Nelson served as a strategic advisor to Monzo from 2019 to 2021. She was an executive for KeyBank from 2015 to 2019. Ms. Nelson served as KeyBank's pacific region executive and market president, was a member of KeyBank's executive council, and director and trustee for the KeyBank Foundation. She served as the president and CEO of Cascade Bank in Everett, Washington from January 2001 to June 2011. She began her banking career at Seafirst Bank which was acquired by Bank of America in 1982 and served in several positions culminating as senior vice president and northern region executive. Ms. Nelson currently serves as chair of the board of Delta Dental of Washington and is an independent director for the U.S. subsidiary of WISE.LON. Ms. Nelson is the past chair of the boards of the Washington State Major League Baseball Public Facilities District and the United Way of King County. She earned a BA in Finance and an MBA from Seattle University. Ms. Nelson's experience, as indicated by her background, support her qualifications to serve as an Independent Director on our Board of Directors. She currently serves as chair of the Technology Committee.

*Matt C. Packard* has served as chairman of the board of Central Bank in Provo, Utah since 2004. Prior to his current position, Mr. Packard was president and chief executive officer of Central Bank from 2000 until his retirement in 2020. Mr. Packard began his banking career in 1976 as a bank teller and has served in a variety of positions throughout his career, including chief lending officer, and as a member of the Executive, Management and Asset Liability committees. Mr. Packard has held numerous industry leadership positions, including chairman of the Utah Bankers Association, Western Independent Bankers Association, and Friends of Traditional Banking, and has served on committees for the American Bankers Association, the Utah Department of Financial Institutions, and Federal Reserve Bank's Community Depository Institutions Advisory Council. Mr. Packard has also served in local government, including six years on the Springville City Council and his current role as mayor, and is a trustee of Intermountain Healthcare Corporate Board, serving on its Investment Committee and as chairman of its Finance Committee. Mr. Packard graduated cum laude from Brigham Young University with a degree in Business Management and from the Pacific Coast Banking School in Washington. Mr. Packard's position as a director of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors

*Jeff L. Plagge* has served as a director for Northwest Bank in Spencer, Iowa since 2009. Mr. Plagge has worked in the banking industry for over 45 years. Mr. Plagge serves as an audit committee member on the board of directors of Northwest Financial Corporation in Arnolds Park, Iowa, and was president and CEO of the company from 2009 to 2019. Prior to that, Mr. Plagge served as president and CEO of First National Bank in Waverly, Iowa and president, CEO and chairman of Midwest Heritage Bank in West Des Moines, Iowa. Mr. Plagge served as the Iowa Superintendent of Banking for the Iowa Division of Banking, a Governor-appointed position he held from 2019 to 2023. Mr. Plagge served on the board of the Conference of State Bank Supervisors Board in Washington D.C. while he was Iowa Superintendent of Banking. Mr. Plagge also serves on the boards of the American Bankers Mutual Insurance, LTD. and Farmer Mac. Mr. Plagge has held numerous industry leadership positions, including chairman of the Iowa Bankers Association, chairman of the American Bankers Association, and former board member of the Chicago Federal Reserve Bank, among others. Mr. Plagge received his bachelor's degree in agriculture business from Iowa State University and is a graduate of the Graduate School of Banking at the University of Colorado - Boulder. Mr. Plagge's position as a director of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors. He currently serves as vice chair of the Technology Committee.

*Lisa A. Stange* is a consulting advisor to Global Meridian Holding Ltd, an affiliate of JPMorgan Asset Management, a position she has held since June 2024. Ms. Stange was previously a strategic advisor to Clearwater Analytics in Boise, Idaho from 2020 to 2024. With over 25 years of experience in insurance company leadership positions, Ms. Stange previously served as chief investment officer of Homesteaders Life Company from 2017 to 2019, chief investment officer and treasurer of EMC Insurance Companies from 2009 to 2014, and in investment roles including portfolio manager at Principal Global Investors from 1989 to 2008. Ms. Stange served as a Governor-appointed trustee on the board of the Iowa Public Employees' Retirement System for 12 years ending in 2023. Ms. Stange currently serves on the Investment Board of the Des Moines Art Center Foundation and the Finance Advisory Board at the University of Iowa Tippie School of Business. Ms. Stange received her Bachelor of Business Administration degree and MBA in Finance from the University of Iowa. She holds the CFA designation. Ms. Stange's experience, as indicated by her background, support her qualifications to serve as an Independent Director on our Board of Directors.

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*Matt C. Stephenson* has served as president and CEO of Rogue Credit Union in Medford, Oregon since 2022. He began his career at the credit union in January 2004, overseeing information technology. He advanced to serve in several key positions there, including chief operations officer (from 2007 to 2008), chief financial officer (from 2008 to 2011), and executive vice president (from 2011 to 2022). Mr. Stephenson serves on various state and national level committees, including the GoWest Governmental Affairs Committee, Credit Union National Association Regulatory Affairs Committee, and the faculty of Western Credit Union Management School at Pomona College. Mr. Stephenson's community involvement includes service on the Central Point City Council, Jackson County Budget Committee, Chamber of Medford/Jackson County Board, Medford School District's Facilities Optimization Committee, Rogue Community College Budget Committee, and the Southern Oregon Regional Economic Development Incorporated board. Throughout his career, Mr. Stephenson has received several notable accolades, including the Credit Union Association of Oregon Young Professional of the Year award, the Heidemann Scholar Award for his efforts in continuing education, and named a Credit Union Rock Star by the Credit Union National Association. Mr. Stephenson holds a Bachelor of Science degree in management information systems and a master's degree in business administration from the University of Nevada, Las Vegas. Mr. Stephenson's position as an officer of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors. He currently serves as vice chair of the Compensation Committee.

*Robert J. Vogel* is chairman of the board for New Market Bank in Elko New Market, Minnesota, a position he has held since 2014. Mr. Vogel joined New Market Bank in 1975 as a cashier. During his tenure, Mr. Vogel held multiple positions including executive vice president and served as president and CEO for 26 years. Mr. Vogel also currently serves as president and chairman for Market Bancorporation, New Market Bank's holding company, a position he has held since 1987. Mr. Vogel has extensive public service experience including serving in the Minnesota House of Representatives beginning in 2014, where he was re-elected for two additional terms before his retirement in 2021. He also served on the Scott County Board of Commissioners from 2002 to 2009. Mr. Vogel is an active member in several organizations, including the Lions Club, New Prague Rotary Club, and Lakeville Chamber of Commerce. Mr. Vogel earned his BA in Finance from the College of St. Thomas in St. Paul, Minnesota. Mr. Vogel's position as a director of a member institution and his experience, as indicated by his background, support his qualifications to serve on our Board of Directors.

**Executive Officers** 

The following persons currently serve as executive officers of the Bank:

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| | | | |
|:---|:---|:---|:---|
| | | | Position Held |
| Executive Officer | Age | Position Held | Since |
| Kristina K. Williams | 61 | President and Chief Executive Officer | January 2020 |
| James G. Livingston | 60 | Chief Financial Officer | January 2023 |
| Joelyn R. Jensen-Marren | 60 | Chief Risk Officer | April 2025 |
| William W. Osborn | 60 | Chief Business Officer | August 2020 |
| Kevin T. Larkin | 57 | Chief Information and Operations Officer | April 2025 |
| Katherine A. Steinke | 57 | Chief Human Resources Officer | December 2021 |
| Robert W. Dixon | 51 | Chief Legal and Compliance Officer | April 2025 |
| Jamie L. Cornish | 37 | Chief Audit Executive | November 2024 |
| Deborah G. Baldwin | 64 | Office of Minority and Women Inclusion Officer | April 2025 |
| Cherie Schuler | 61 | Senior Director of Member and Financial Operations | June 2022 |

---

*Kristina K. Williams* is currently serving as President and CEO, a position she has held since January 2020. She began her association with the Federal Home Loan Bank System in 2004. Prior to her current role, she served as the COO of the Pittsburgh Bank, a position she held from 2011 to 2019. In that role, Ms. Williams had responsibility for all member-facing departments, including community investment, communications, product delivery, member services, and IT. In her 15 years with the Pittsburgh Bank she also held positions of chief accounting officer, CFO, and acting CRO. Prior to working for the Pittsburgh Bank, Ms. Williams spent 12 years with PNC Financial Services in its wholesale bank and six years in public accounting. She is currently serving on the boards of Greater Des Moines Habitat for Humanity and the Greater Des Moines Partnership. She formerly served as vice chair of the West Liberty University Board of Governors. Ms. Williams also previously served as the development committee chair of the board of directors for Strong Women Strong Girls of Pittsburgh. Ms. Williams has an undergraduate degree from West Liberty University and Masters of Professional Accountancy from West Virginia University. She is also a CPA (inactive) and received an honorary Doctor of Humane Letters degree from West Liberty University in 2015.

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*James G. Livingston* is currently serving as CFO, a position he has held since January 2023. Mr. Livingston has responsibility for the Bank's accounting, financial reporting, corporate finance, and capital markets functions. Prior to joining the Bank, he held various roles at Zions Bancorporation in Salt Lake City, Utah beginning in 2005, most recently serving as executive vice president starting in 2017. Mr. Livingston was elected to the Seattle Bank's Board of Directors in 2007 and served on the Bank's Board from the merger in 2015 until 2021. He served as the Board's Chair in 2020 and 2021. He earned a BA in economics from Brigham Young University and an MA in applied economics and Ph.D. in business administration from the University of Rochester.

*Joelyn R. Jensen-Marren* is currently serving as CRO, a position she has held since April 2025. In her role, Ms. Jensen-

Marren has responsibility for the Bank's enterprise risk management area, including credit risk, market risk, operational risk,

and model risk. Ms. Jensen-Marren previously served as the Chief Risk and Compliance Officer from January 2023 to April 2025 and CFO beginning in June 2019. Prior to serving as CFO, Ms. Jensen-Marren served as senior vice president, director of portfolio strategy from 2014 to 2019. Ms. Jensen-Marren joined the Bank in 1999 and has served in various leadership roles. Ms. Jensen-Marren received her undergraduate degree from Iowa State University with a Master's degree from the University of Colorado, Denver.

*William W. Osborn* is currently serving as CBO, a position he has held since August 2020. Mr. Osborn is responsible for the Bank's member-facing departments, including member relationships and sales, member strategies and solutions, marketing and communication, and the mortgage product group. He also leads the Bank's strategic planning efforts. Prior to joining the Bank, he served as senior vice president and CFO of the Topeka Bank, a position he held from 2010 to 2020. Mr. Osborn also served as director of product profitability and pricing of the Topeka Bank from 2006 to 2007. Mr. Osborn was promoted to director of banking strategies in January 2008, to first vice president in April 2008, and to senior vice president in April 2009. Mr. Osborn is a CFA and a member of the CFA Institute. Mr. Osborn received his undergraduate degree from Brigham Young University and MBA degree from Westminster College.

*Kevin T. Larkin* is currently serving as CIOO, a position he has held since April 2025 and previously served as Chief Information Officer from March 2020 to April 2025. Mr. Larkin oversees the Bank's IT, information security, and member financial operations departments. Prior to joining the Bank, Mr. Larkin served as vice president, managing director, IT operations of the Chicago Bank since 2019. He previously served as the vice president, managing director, IT risk, compliance, and administration of the Chicago Bank from 2018 to 2019. Prior to joining the Chicago Bank, Mr. Larkin served as assistant vice president of business systems and IT governance for Illinois Mutual Life Insurance from 2014 to 2018. In addition, Mr. Larkin previously served as the director of business solutions for the Pittsburgh Bank from 2001 to 2014. He has earned a bachelors degree from Gannon University and both an MBA degree and Master's in information systems management from Duquesne University.

*Katherine A. Steinke* is currently serving as CHRO, a position she has held since December 2021. Ms. Steinke has management responsibility for the human resources, facilities, business resiliency, and records management departments. Prior to joining the Bank, Ms. Steinke previously served as vice president, human resources, for Farm Credit Services of America in Omaha, Nebraska from 2017 to 2021. Prior to her tenure at Farm Credit Services of America, she served as director, human resources at Glacial Lakes Energy in Watertown, South Dakota from 2011 to 2017. Ms. Steinke earned her undergraduate degree from the University of Nebraska Medical Center and a Master's in HR Management/Labor and Employment Relations from Penn State University.

*Robert W. Dixon* is currently serving as CLCO, a position he has held since April 2025. Mr. Dixon has management responsibility for the Bank's legal, compliance, government relations, external relations, community investment, and OMWI departments. He also serves as Corporate Secretary. Mr. Dixon previously served as General Counsel from September 2022 to April 2025, Vice President and Deputy General Counsel from 2021 to 2022, and Vice President and Associate General Counsel from 2013 to 2021. Prior to joining the Bank, Mr. Dixon practiced law at Davis Brown Law Firm in Des Moines, Iowa from 2010 to 2013 and at Vedder Price P.C. in Chicago, Illinois from 2001 to 2010. Mr. Dixon received his undergraduate degree from the University of Iowa and his Juris Doctor degree from Drake University Law School. He graduated from the Greater Des Moines Leadership Institute in 2013 and served as Board President for Big Brothers Big Sisters of Central Iowa from 2021 to 2023.

*Jamie L. Cornish* is currently serving as CAE, a position she has held since November 2024. In her role, Ms. Cornish has management responsibility for the internal audit department. Prior to joining the Bank, Ms. Cornish was a senior manager with Ernst & Young in Des Moines, Iowa, a position she held from 2019 to 2024, and held positions of increasing responsibility from 2011 to 2019. Ms. Cornish is a CPA, and she earned degrees in Accounting and Economics from the University of Northern Iowa.

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*Deborah G. Baldwin* is currently serving as OMWI Officer, a position she has held since April 2025. In this role, Ms. Baldwin oversees all aspects of the Bank's OMWI. She previously served as Chief Diversity, Equity and Inclusion Officer from May 2020 to April 2025. Prior to joining the Bank, she consulted on diversity and inclusion strategy development and execution from 2018 to 2020. Prior to consulting, Ms. Baldwin was the deputy director, OMWI, at the National Credit Union Administration from 2016 to 2018. In addition, Ms. Baldwin previously served as assistant vice president, diversity and inclusion, at the Federal Reserve Bank of Chicago from 2011 to 2014. Ms. Baldwin received her undergraduate degree from Georgia State University and holds certifications in unconscious bias training and the Intercultural Development Inventory designed to assess cross-cultural competence.

*Cherie Schuler* is currently serving as the Senior Director of Member and Financial Operations, a position she has held since June 2022. Ms. Schuler previously served as Director of Member Financial Operations from 2018 to 2022, and has held various roles since joining the Bank in 1984. In her role, Ms. Schuler oversees the member and financial operations of the Bank, which includes the advance funding desk, membership, collateral management, and other bank operations. She also serves as the Office of Foreign Assets Control officer. Ms. Schuler earned her business degree from Upper Iowa University and obtained a certification from the Banking Administration Institute Graduate School of Operations and Payments. Ms. Schuler is also an Accredited Automated Clearing House Professional.

**Code of Ethics**

We have adopted a Code that sets forth the guiding principles and rules of conduct by which we operate and conduct our daily business with our customers, vendors, shareholders, and fellow employees. The Code applies to all of our directors, officers, and employees. The purpose of the Code is to promote honest and ethical conduct and compliance with the law, particularly as it relates to the maintenance of our financial books and records and the preparation of our financial statements. The Code can be found on our website at <u>www.fhlbdm.com</u>. We disclose on our website any amendments to, or waivers of, the Code. The information contained in or connected to our website is not incorporated by reference into this annual report on Form 10-K and should not be considered part of this or any report filed with the SEC.

**Insider Trading Policy**

We are cooperatively owned. Our member institutions (and, in limited circumstances, our former member institutions) own our capital stock. No individuals (including our directors, officers and employees) may own our capital stock.

Our capital stock can only be acquired, redeemed or repurchased at a par value of $100 per share. Our capital stock is not publicly traded, and no market exists for the disposition of our capital stock. The sole avenue for disposition of our capital stock by a member is redemption by the Bank. Members must purchase and maintain capital stock in our Bank as a condition of membership and may be required to purchase additional stock in order to transact advances, MPF and/or letters of credit activity with us. Transactions in our capital stock are governed by applicable regulatory requirements and our Capital Plan. Our Capital Plan is listed as an exhibit to this annual report on Form 10-K. Refer to "<u>[Item 15. Exhibits and Financial Statement Schedules](#i6940522039644a7690f9aab973fdec20_322)</u>" for additional information.

In addition to our cooperative structure, our primary source of funding is the issuance of debt securities, which are consolidated obligations issued as bonds and discount notes, that are sold by dealers to investors in the public. We therefore have adopted an Insider Trading Policy aimed at promoting compliance with insider trading laws. This policy is filed as Exhibit 19.1 to this annual report on Form 10-K.

**Audit Committee**

The purpose of the Audit Committee is to assist the Board of Directors in fulfilling its review and oversight responsibilities for (i) the integrity of the Bank's financial statements and financial reporting process and systems of internal accounting and financial reporting controls, (ii) the independence, scope of audit services, and performance of the Bank's internal audit function as well as the appointment or replacement of the Bank's CAE, (iii) the selection and replacement, qualifications, independence, scope of audit, and performance of the Bank's external auditor, (iv) the Bank's compliance with laws, regulations and policies, including the Code of Ethics, and (v) the policy for complaints regarding questionable accounting, internal accounting controls, and auditing matters, and oversight of fraud investigations. The Audit Committee has adopted a charter outlining its roles and responsibilities, which is available on our website at <u>www.fhlbdm.com</u>*.* The information contained in or connected to our website is not incorporated by reference into this annual report on Form 10-K and should not be considered part of this or any report filed with the SEC.

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The members of our Audit Committee for 2026 are Jon Jones (chair), Russell Lau (vice chair), Ruth Bennett, Cleon Butterfield, Edward Garding, Joe Kesler, and Elsie Meeks. The Audit Committee held a total of 13 meetings in 2025. As of February 28, 2026, the Audit Committee has held one meeting and is scheduled to hold 11 meetings throughout the remainder of 2026. Refer to Exhibit 99.1 of this 2025 Annual Report for the Audit Committee Report.

**Audit Committee Financial Expert**

Our Board of Directors determined that Cleon Butterfield, Edward Garding, Jon Jones, Russell Lau, and Elsie Meeks, members of its Audit Committee, qualify as audit committee financial experts under Item 407(d)(5) of Regulation S-K. Refer to "<u>[Item 13. Certain Relationships and Related Transactions, and Director Independence](#i6940522039644a7690f9aab973fdec20_313)</u>" for details on our director independence. For information concerning the experience through which these individuals acquired the attributes required to be deemed financial experts, refer to the biographical information in this Item 10.

**<u>ITEM 11. EXECUTIVE COMPENSATION</u>**

**COMPENSATION DISCUSSION AND ANALYSIS**

This Compensation Discussion and Analysis section provides information related to the administration of our executive compensation policies and programs. We believe we have taken a prudent and effective approach to executive compensation with practices aligned with the Finance Agency's guidance on FHLBank executive compensation.

This section describes and analyzes our 2025 executive compensation program for:

&nbsp;&nbsp;&nbsp;&nbsp;• the executive officer serving as CEO during 2025;

&nbsp;&nbsp;&nbsp;&nbsp;• the executive officer serving as CFO during 2025; and

&nbsp;&nbsp;&nbsp;&nbsp;• the three other most highly compensated executive officers who were serving as executive officers on December 31, 2025.

These executive officers are collectively referred to as our NEOs.

This Compensation Discussion and Analysis includes the following parts:

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| | |
|:---|:---|
| **CONTENTS** | |
| [Compensation Philosophy](#i6940522039644a7690f9aab973fdec20_271) | [128](#i6940522039644a7690f9aab973fdec20_271) |
| [Elements of Executive Compensation](#i6940522039644a7690f9aab973fdec20_274) | [128](#i6940522039644a7690f9aab973fdec20_274) |
| [Finance Agency Oversight - Executive Compensation](#i6940522039644a7690f9aab973fdec20_277) | [130](#i6940522039644a7690f9aab973fdec20_277) |
| [Roles and Responsibilities in Establishing Executive Compensation](#i6940522039644a7690f9aab973fdec20_280) | [130](#i6940522039644a7690f9aab973fdec20_280) |
| [Analysis Tools the Compensation Committee Uses](#i6940522039644a7690f9aab973fdec20_283) | [131](#i6940522039644a7690f9aab973fdec20_283) |
| [Compensation Decisions in](#i6940522039644a7690f9aab973fdec20_286)2025 | [131](#i6940522039644a7690f9aab973fdec20_286) |
| [Benefits and Retirement Philosophy](#i6940522039644a7690f9aab973fdec20_292) | [135](#i6940522039644a7690f9aab973fdec20_292) |
| [CEO Compensation Pay Ratio](#i6940522039644a7690f9aab973fdec20_298) | [136](#i6940522039644a7690f9aab973fdec20_298) |
| [Potential Payments upon Termination or Change of Control](#i6940522039644a7690f9aab973fdec20_301) | [137](#i6940522039644a7690f9aab973fdec20_301) |
| [Director Compensation](#i6940522039644a7690f9aab973fdec20_304) | [141](#i6940522039644a7690f9aab973fdec20_304) |
| [Compensation Committee Report](#i6940522039644a7690f9aab973fdec20_307) | [142](#i6940522039644a7690f9aab973fdec20_307) |

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**Compensation Philosophy**

Our compensation philosophy, practices, and principles are important to our business strategy. Our philosophy assists us in attracting, retaining, and engaging employees with the skills and talent we need to create and implement strategies critical to our long-term success, ensuring we bring value for our members. Our executive compensation practices provide a framework to ensure an appropriately balanced approach to compensation through a combination of base salary, benefits, and annual and deferred cash incentive awards. Although we refine our compensation programs as economic conditions and competitive practices change, we strive to maintain consistency in our philosophy and approach with respect to executive compensation.

We believe our current employees and those individuals in our potential talent pool are highly marketable and can be attracted to opportunities across a broad spectrum of U.S. financial services businesses. Our competition for talent primarily includes FHLBanks, commercial banks, and other financial services companies, such as insurance companies.

We have designed our executive compensation program to motivate our NEOs to achieve our objectives for delivering value to our members, as customers and as shareholders, without taking undue risk.

Our executive compensation program is designed to do the following:

&nbsp;&nbsp;&nbsp;&nbsp;i.Attract, motivate, reward, and retain the talent and skill sets important to run our business and execute our short- and long-term strategic objectives.

&nbsp;&nbsp;&nbsp;&nbsp;ii.&nbsp;&nbsp;&nbsp;&nbsp;Link executive compensation to Bank performance while monitoring the Bank's exposure to risk.

&nbsp;&nbsp;&nbsp;&nbsp;iii.&nbsp;&nbsp;&nbsp;&nbsp;Structure our total compensation package for NEOs so that it is competitive relative to market. Our competitive market primarily consists of FHLBanks, commercial banks, and other financial services companies. We generally consider total compensation to be competitive at the 50th percentile of the market data.

&nbsp;&nbsp;&nbsp;&nbsp;iv. &nbsp;&nbsp;&nbsp;&nbsp;Align with the Bank's mission and culture.

In 2025, we executed on our executive compensation philosophy to provide competitive compensation to our NEOs that was aligned to the achievement of business objectives and Bank performance.

**Elements of Executive Compensation** 

Our executive compensation program is comprised of the following elements: (i) base salary, (ii) an EIP that includes a 50 percent annual cash award and a 50 percent deferral of the incentive award, (iii) retirement benefits, (iv) health and welfare benefits, (v) the potential for payments in the event of termination, (vi) limited perquisites, and (vii) other amounts as defined. Equity-based compensation is not an element of the compensation program, because our stock cannot be owned by individuals and can only be purchased and sold at par between a member and the Bank. See "<u>[Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Capital — Capital Stock](#i57dfd06e31f94e2095e69a37b026d652_15613)</u>" for additional information on our capital stock. The following discussion provides more detail for each of these elements.

BASE SALARY

Base salary is a fixed component of our NEOs' total compensation that is intended to provide a level of compensation necessary to attract and retain highly qualified executives. Our President and CEO is the only NEO with an employment agreement with us that sets forth minimum base salary. This employment agreement provides that we shall initially pay our President and CEO an annualized base salary of not less than the amount set forth in the agreement. Base salary may only be adjusted upward based on an annual review by the Board of Directors and may not be adjusted downward unless such downward adjustment is part of a nondiscriminatory cost reduction plan applicable to our total compensation budget. For additional information regarding base salary, see the sections entitled "<u>[Roles and Responsibilities in Establishing Executive Compensation](#i6940522039644a7690f9aab973fdec20_280)</u>" and "<u>[Base Salary Levels](#iff18cba79fb7438bb9b4393221811508_8439)</u>" in this Item 11.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

EXECUTIVE INCENTIVE PLAN

In December 2024, the Compensation Committee approved the 2025 EIP and the Bank-wide goal measures. In addition, we received a non-objection letter from the Finance Agency for our 2025 EIP in January 2025. In April 2025, the Compensation Committee amended the EIP, and we received a non-objection letter from the Finance Agency for our revised 2025 EIP in May 2025. The EIP includes an annual cash incentive and a deferred cash incentive. The Compensation Committee considers a variety of safety and soundness measures to determine the appropriate incentive payouts, such as (i) operational errors or omissions that result in material revisions to the financial results, information submitted to the Finance Agency, or data used to determine incentive payouts, (ii) untimely submission of information to the SEC, Office of Finance, or Finance Agency, (iii) failure to make sufficient progress, as determined by the Finance Agency, in the timely remediation of examination, monitoring, and other supervisory findings and matters requiring attention, or (iv) whether the Bank's annual average MVCS, calculated using the ending amount of each month during the plan year, is equal to or greater than $100. If one of the above occurs, the Compensation Committee will consider the facts and circumstances and reduce incentive awards commensurate with the materiality of the exception relative to our financial and operational performance and financial reporting responsibilities.

Under the 2025 EIP, our NEOs are required to defer 50 percent of their total cash incentive. The deferred awards earned in 2025 will be paid one-third annually, beginning in 2027, and include interest based on annual ROE as of December 31st each year, credited annually. The deferred awards earned in plan years prior to 2024 were deferred for three years following the end of the performance plan period and include a four percent interest rate, credited annually. All deferred opportunities, including interest, are subject to the Bank's sustained achievement of the safety and soundness measures described above and approvals by the Compensation Committee and Board of Directors.

The 2025 EIP provides that unless otherwise directed by the Compensation Committee, payments under the EIP shall be made in a lump sum through regular payroll distribution, typically within 75 days after the end of the calendar year for which the performance or deferral period is ended, but in any event by the end of the calendar year following the performance or deferral period.

Under the EIP, the Compensation Committee may determine an NEO is not eligible to receive an incentive payout if the respective NEO (i) has not achieved a performance level of "meets expectations" or higher evaluation of overall performance during a performance period or deferred performance period, (ii) is subject to any disciplinary action or probationary status at the time of payout, or (iii) fails to comply with regulatory requirements or standards, internal control standards, professional standards or any internal standard, or fails to perform responsibilities assigned under our SBP.

For additional information about our EIP, see "<u>[EIP Award Opportunities](#iff18cba79fb7438bb9b4393221811508_8440)</u>" and "<u>[EIP Performance Measures and Results](#iff18cba79fb7438bb9b4393221811508_8438)</u>" in this Item 11.

RETIREMENT BENEFITS

We have one qualified defined contribution benefit plan, the DC Plan. We also offer a nonqualified defined contribution retirement plan, the NQDC Plan, which consists of the BEP, and as of 2024, was amended to include the SERP. The BEP allows the NEOs to contribute amounts they would have been entitled to contribute under the DC Plan had the plan not been subject to Internal Revenue Code contribution limitations. Under the SERP, an additional retirement benefit for executive officers, the Bank may provide annual discretionary contributions as determined by the Board of Directors.

The table below shows which retirement plans each NEO participates in:

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| | | |
|:---|:---|:---|
| NEO | Principal Position | Retirement Plans<sup>1</sup> |
| Kristina K. Williams | President and CEO | DC Plan, NQDC Plan |
| James G. Livingston | CFO | DC Plan, NQDC Plan |
| William W. Osborn | CBO | DC Plan, NQDC Plan |
| Joelyn R. Jensen-Marren | CRO | DC Plan, NQDC Plan |
| Kevin T. Larkin | CIOO | DC Plan, NQDC Plan |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Beginning in 2024, the BEP was amended to also include the SERP, and is collectively referred to as the NQDC Plan.

For additional information about our retirement benefits, see "<u>[Benefits and Retirement Philosophy](#i6940522039644a7690f9aab973fdec20_292)</u>" in this Item 11.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

HEALTH AND WELFARE BENEFITS

Our NEOs are eligible for the same medical, dental, life insurance, and other benefits available to our full-time employees.

PAYMENTS IN THE EVENT OF TERMINATION

Our President and CEO has an employment agreement with us, which provides for payments in the event of termination based on certain triggering events. All other NEOs are subject to the Bank's Executive Severance Plan, set forth in "<u>[Item 15. Exhibits and Financial Statements Schedules](#i6940522039644a7690f9aab973fdec20_322)</u>." For additional details, see "<u>[Potential Payments Upon Termination or Change of Control](#i6940522039644a7690f9aab973fdec20_301)</u>" in this Item 11.

PERQUISITES

Our NEOs are eligible to receive perquisites as a convenience associated with their overall duties and responsibilities. Our President and CEO is eligible to receive a monthly car allowance. All NEOs generally qualify for certain other perquisites, such as financial planning assistance, mobile technology allowance, lifestyle spending account, life and long-term disability insurance coverage, and/or relocation reimbursements. For additional details, see "<u>[Components of All Other Compensation](#i8233154b031c43c3b75d53bd7c1434e0_2136)</u>" in this Item 11.

OTHER

Our NEOs may be eligible to receive a hiring bonus and other benefits. Mr. Livingston received a hiring bonus in 2023, as well as bonuses in 2024 and 2025 following his first and second years of employment.

**Finance Agency Oversight - Executive Compensation**

In addition to our internal processes, the Finance Agency has oversight authority over our executive compensation. The FHLBanks provide all compensation actions affecting their NEOs to the Finance Agency for review and non-objection.

Applicable rules also establish the following principles for executive compensation:

&nbsp;&nbsp;&nbsp;&nbsp;i.executive compensation must be reasonable and comparable to that offered to executives in similar positions at comparable financial institutions;

&nbsp;&nbsp;&nbsp;&nbsp;ii.&nbsp;&nbsp;&nbsp;&nbsp;executive compensation should be consistent with sound risk management and preservation of the par value of the FHLBank's capital stock;

&nbsp;&nbsp;&nbsp;&nbsp;iii.&nbsp;&nbsp;&nbsp;&nbsp;a significant percentage of an executive's incentive-based compensation should be tied to longer-term performance and outcome indicators and be deferred and made contingent upon performance over several years; and

&nbsp;&nbsp;&nbsp;&nbsp;iv.&nbsp;&nbsp;&nbsp;&nbsp;the Board of Directors should promote accountability and transparency in the process of setting compensation.

**Roles and Responsibilities in Establishing Executive Compensation**

Merit increases are based upon an evaluation of an NEO's overall performance. Because of our size and the number of NEOs involved, our President and CEO recommends to the Compensation Committee merit increases for the other NEOs. The Board of Directors completes an evaluation of our President and CEO's performance and the Compensation Committee recommends compensation for our President and CEO to the Board of Directors for approval. The Compensation Committee and our President and CEO consider overall performance in key focus areas aligned with our SBP for the year, and review NEO compensation relative to the market, in analyzing merit increases. Any employment or severance agreement for our President and CEO is also approved by the Board of Directors.

Throughout the year, the Board of Directors reviews our Bank-wide goals and achievement levels. When final Bank performance metrics for a calendar year are determined, the Compensation Committee reviews the performance results to determine the level of performance that has been achieved for purposes of making incentive compensation decisions for our NEOs. Our Compensation Committee approves the Bank-wide goals framework and approves the incentive awards comprised of Bank-wide goals.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

**Analysis Tools the Compensation Committee Uses**

For 2025, the Compensation Committee engaged McLagan Partners to conduct an assessment and make recommendations regarding compensation for our executives based on the results of their competitive analysis. This included identification of sources of market data for purposes of the competitive compensation assessments of base pay and annual and deferred cash incentives. This analysis compared the compensation of our executives utilizing the following sources:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Public disclosures (e.g., proxy statements and annual reports) for the top five highest paid executives at banks with assets between $10 billion and $20 billion;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the FHLBank System; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Commercial banks included in the McLagan assessment.

The primary market comparison for their assessment was commercial banks from the McLagan data and the other FHLBanks. This was used to determine the market median for each position, which the Compensation Committee and President and CEO used to inform themselves regarding trends in compensation practices. When using FHLBank System comparisons, our executives are compared to the same position within the FHLBanks. When using commercial bank comparisons, our executive positions are compared to roles with similar overall responsibility.

**Compensation Decisions in 2025** 

How we compensate our NEOs sets the tone for how we administer pay throughout the entire Bank. For 2025, our Compensation Committee considered numerous factors (including those previously discussed) before deciding on the appropriate total compensation for our NEOs, in the context of the current business, operating, and regulatory environment, which are more fully described in the following narrative.

BASE SALARY LEVELS

The Compensation Committee followed its historical practice of adjusting base salaries after a review of individual performance and current compensation of our NEOs. The Compensation Committee determined that our President and CEO's base salary for 2025 was appropriate and, based on the President and CEO's recommendations, that base salaries for the other NEOs were appropriate, based on (i) each NEOs' individual performance, contributions to the Bank, length of time in position, and changes in responsibilities, if applicable, and (ii) a review of the McLagan Partners' executive compensation survey data. The NEOs' base salaries, presented in the "<u>[Summary Compensation Table](#i6940522039644a7690f9aab973fdec20_289)</u>" in this Item 11, become effective January 1st of each year, unless described otherwise.

EIP AWARD OPPORTUNITIES

EIP pay targets established for our NEOs take into consideration total compensation practices (base salary and incentives) of the survey data reviewed. Under the EIP, our NEOs are assigned target award opportunities, stated as percentages of base salary. The target award opportunities are determined based on market data and level of responsibility and are approved by our Compensation Committee.

Awards are paid to our NEOs based upon the achievement level of Bank-wide goals as determined by the Compensation Committee. In addition, 50 percent of the incentive award for NEOs is deferred. For the 2025 EIP, the deferred awards will be paid one-third annually, beginning in 2027. For plan years prior to 2024, the unpaid deferred awards will be paid following the end of the three year performance period. The actual amount of the awards paid each year will be subject to the Bank's sustained achievement of the applicable safety and soundness measures, as defined in the EIP, and the Compensation Committee's and Board of Directors' approvals at the time of payment.

The annual and deferred EIP award opportunities for our NEOs in 2025 were a percentage of base salary as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
| Title | Incentive<br>Plan | Threshold | Target | Maximum |
| President and CEO | Annual | 25.0% | 40.0% | 50.0% |
|  | Deferred | 25.0% | 40.0% | 50.0% |
| Other NEOs | Annual | 20.0% | 30.0% | 40.0% |
|  | Deferred | 20.0% | 30.0% | 40.0% |

---

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table provides estimated potential payouts under our EIP:

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| | | | |
|:---|:---|:---|:---|
| 2025 Grants of Plan-Based Awards | 2025 Grants of Plan-Based Awards | 2025 Grants of Plan-Based Awards | 2025 Grants of Plan-Based Awards |
|  | Estimated Future Payouts Under <br>Non-Equity Incentive Plan Awards<sup>1</sup> | Estimated Future Payouts Under <br>Non-Equity Incentive Plan Awards<sup>1</sup> | Estimated Future Payouts Under <br>Non-Equity Incentive Plan Awards<sup>1</sup> |
| NEO | Threshold | Target | Maximum |
| Kristina K. Williams | $583874 | $934198 | $1167748 |
| James G. Livingston | 180336 | 270504 | 360672 |
| William W. Osborn | 193514 | 290272 | 387028 |
| Joelyn R. Jensen-Marren | 180353 | 270530 | 360706 |
| Kevin T. Larkin | 175100 | 262650 | 350200 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Amounts consist of the annual incentive (50 percent of total incentive) and deferred incentive (50 percent of total incentive). The eligible deferred awards will be paid one-third annually and include interest based on annual ROE as of December 31st each year, credited annually, which is not included in the table above. All deferred incentive and interest payments are subject to the Bank's sustained achievement of the 2025 safety and soundness measures and Compensation Committee's and Board of Directors' approvals at the time of payment.

EIP PERFORMANCE MEASURES AND RESULTS

In December 2024, the Compensation Committee approved the Bank-wide goals framework for 2025. In December 2024, and subsequently in April 2025, the Compensation Committee approved the Bank-wide goal measures for 2025, which are summarized below:

&nbsp;&nbsp;&nbsp;&nbsp;i.*Improvement of Advance Penetration* is measured by the dollar amount of advance usage relative to each member's total assets in the Bank's district. The goal will be measured in comparison to the other Federal Home Loan Banks.

&nbsp;&nbsp;&nbsp;&nbsp;ii.*Core Product Utilization* is measured by the utilization of core products by all Bank members, including all advances, standby letters of credit, and MPF (including on balance sheet and off balance sheet).

&nbsp;&nbsp;&nbsp;&nbsp;iii.*Affordable Housing and Community Development Mission* is measured by the sum of member participation in the Bank's core and discretionary housing mission products.

&nbsp;&nbsp;&nbsp;&nbsp;iv.*Financial Performance* is measured by the spread between AROCS and average overnight SOFR. AROCS is a measure of profitability that adjusts GAAP net income for certain non-routine or unpredictable items, such as market value adjustments, prepayment fee income, and other non-routine items.

&nbsp;&nbsp;&nbsp;&nbsp;v.*Operational Continuous Improvement* is measured by the completion of projects and initiatives in 2025 according to scope, timelines, and success measures approved by management.

&nbsp;&nbsp;&nbsp;&nbsp;The Bank's EIP design has historically included Bank-wide goals. This plan design has resulted in reasonable payouts to our NEOs. We believe this plan design has accomplished these goals and driven the behaviors of all employees, including our NEOs, in accordance with our Board of Directors' expectations.

For 2025, NEO incentive awards are tied entirely to the achievement of Bank-wide goals, with weighting determined by the Compensation Committee based upon the need for our NEOs to focus on certain strategic imperatives contained in our SBP.

When establishing the Bank-wide goals, the Compensation Committee and the Board of Directors anticipated that we would reasonably achieve the target level of performance aligned with objectives contained in our SBP. The maximum level provides a goal that is anticipated to be more challenging to reach, based on the previous year's performance results and current market trends and conditions. The Bank-wide goal incentive awards are paid based on the actual results we achieve. The weightings for each goal area are generally aligned with our SBP and areas of key focus. The 2025 to 2027 SBP was approved by the Board of Directors in December of 2024.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

On a regular basis during 2025, management provided an update to the Board of Directors on the status of performance relative to Bank-wide goals. The following table provides the 2025 EIP Bank-wide goals for our NEOs as well as our performance results, which were approved by the Board of Directors in February 2026:

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| | | | | |
|:---|:---|:---|:---|:---|
| Bank-wide Goals | 2025 Results | Threshold | Target | Maximum |
| Improvement of Advance Penetration (15% Weight) | 6th in the FHLBank System | 8th in the FHLBank System | 6th in the FHLBank System | 4th in the FHLBank System |
| Core Product Utilization (15% Weight) | 71% | 68% | 71% | 76% |
| Affordable Housing and Community Development Mission (30% Weight) | 802 | 600 | 700 | 800 |
| Financial Performance (Spread Between AROCS and SOFR) (30% Weight) | 9.67% | 7.52% | &nbsp;&nbsp;&nbsp;&nbsp;8.52% | &nbsp;&nbsp;&nbsp;&nbsp;9.52% |
| Operational Continuous Improvement (10% Weight) | 6/7 | 3/7 | 5/7 | 7/7 |

---

The overall weighted achievement of the Bank-wide goals was 115.88 percent of target for our President and CEO and 121.33 percent of target for all other NEOs. Based on these results, the Compensation Committee awarded each NEO the amounts identified in the following table. We received a non-objection letter from the Finance Agency for the Bank-wide Performance awards in February 2026:

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| | | | | |
|:---|:---|:---|:---|:---|
| NEO | Annual Incentive<sup>1</sup> | Deferred Incentive<sup>1</sup> | Interest Earned on Deferred Incentive<sup>2</sup> | Total Bank-wide Performance Award |
| Kristina K. Williams | $541275 | $541275 | $85923 | $1168473 |
| James G. Livingston | 164101 | 164101 | 20226 | 348428 |
| William W. Osborn | 176094 | 176094 | 29855 | 382043 |
| Joelyn R. Jensen-Marren | 164117 | 164117 | 26745 | 354979 |
| Kevin T. Larkin | 159336 | 159336 | 26255 | 344927 |

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1&nbsp;&nbsp;&nbsp;&nbsp;Bank-wide performance award consists of annual incentive (50 percent of total incentive), paid in 2026, and a deferred incentive (50 percent of total incentive). The deferred incentive amounts were earned as of December 31, 2025, but will be paid one-third annually beginning in 2027, and remain subject to the Bank's sustained achievement of the 2025 safety and soundness measures and Compensation Committee's and Board of Directors' approvals at the time of payment.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents four percent interest, credited annually, earned on the 2022 and 2023 deferred incentives, which will be paid in 2026 and 2027. Amounts also represent interest earned on the unpaid 2024 deferred incentive awards, which will be paid one-third annually beginning in 2026. The interest earned on the 2024 deferred incentive awards is based on annual ROE of 8.71 percent as of December 31, 2025. All payments are subject to the Bank's sustained achievement of all applicable safety and soundness measures and Compensation Committee's and Board of Directors' approvals at the time of payment.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

The following table illustrates for each NEO the maximum amount of unpaid deferred awards as of December 31, 2025, distributable under the EIP for 2022, 2023, 2024, and 2025, assuming the Bank achieved all applicable safety and soundness measures and no additional discretion is exercised by the Board of Directors. Payments will vary based on actual Bank performance in each year of the deferral period and are subject to non-objection by the Finance Agency.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| NEO | Amount Distributable in 2026<sup>1</sup> | Amount Distributable in 2027<sup>2</sup> | Amount Distributable in 2028<sup>3</sup> | Amount Distributable in 2029<sup>4</sup> | Total |
| Kristina K. Williams | $626473 | $933931 | $577701 | 236951 | $2375056 |
| James G. Livingston | 57809 | 294392 | 134926 | 71838 | 558965 |
| William W. Osborn | 255607 | 329693 | 146245 | 77087 | 808632 |
| Joelyn R. Jensen-Marren | 216536 | 303111 | 135612 | 71845 | 727104 |
| Kevin T. Larkin | 212699 | 299504 | 131663 | 69752 | 713618 |

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1 &nbsp;&nbsp;&nbsp;&nbsp;Represents the 2022 deferred incentive awards payable in 2026 and includes four percent interest, credited annually, over the three-year deferral period. Amounts also include one-third of the 2024 deferred incentive awards, including interest based on the ROE earned in each year of the deferral period, credited annually.

2&nbsp;&nbsp;&nbsp;&nbsp;Represents the 2023 deferred incentive awards payable in 2027 and includes four percent interest, credited annually, over the three-year deferral period. Amounts also include one-third of the 2024 and 2025 deferred incentive awards, including interest based on the ROE earned in each year of the deferral period, credited annually. Future interest is estimated utilizing the most recent three-year average ROE.

3&nbsp;&nbsp;&nbsp;&nbsp;Represents one-third of the 2024 and 2025 deferred incentive awards, including interest based on the ROE earned in each year of the deferral period, credited annually. Future interest is estimated utilizing the most recent three-year average ROE.

4&nbsp;&nbsp;&nbsp;&nbsp;Represents one-third of the 2025 deferred incentive awards, including interest based on the most recent three-year average ROE, credited annually.

SUMMARY COMPENSATION TABLE

The following table provides compensation information for our NEOs, as applicable, for the years ended December 31, 2025, 2024, and 2023:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| Summary Compensation Table | Summary Compensation Table | Summary Compensation Table | Summary Compensation Table | Summary Compensation Table | Summary Compensation Table | Summary Compensation Table | Summary Compensation Table |
| Name and Principal Position | Year | Salary | Bonus | Non-Equity Incentive Plan Compensation<sup>1</sup> | Change in Pension Value and Non-Qualified Deferred Compensation Earnings<sup>2</sup> | All Other<br>Compensation<sup>3</sup> | Total |
| Kristina K. Williams | 2025 | $1167748 | $— | $1168473 | $— | $504382 | $2840603 |
| President and CEO | 2024 | 1112141 |  | 1131542 |  | 466099 | 2709782 |
|  | 2023 | 1050566 |  | 1044292 |  | 145302 | 2240160 |
| James G. Livingston<sup>4</sup> | 2025 | 450840 | 100000 | 348428 |  | 149678 | 1048946 |
| CFO | 2024 | 433500 | 100000 | 325151 |  | 130280 | 988931 |
|  | 2023 | 405817 | 150000 | 304362 |  | 233430 | 1093609 |
| William W. Osborn | 2025 | 483785 |  | 382043 |  | 157593 | 1023421 |
| CBO | 2024 | 474300 |  | 386172 |  | 117645 | 978117 |
|  | 2023 | 465000 |  | 360971 |  | 65278 | 891249 |
| Joelyn R. Jensen-Marren | 2025 | 450883 |  | 354979 |  | 141500 | 947362 |
| CRO | 2024 | 437750 |  | 353406 |  | 132948 | 924104 |
|  | 2023 | 425000 |  | 328827 |  | 43835 | 797662 |
| Kevin T. Larkin | 2025 | 437750 |  | 344927 |  | 139655 | 922332 |
| CIOO | 2024 | 425000 |  | 343417 |  | 102153 | 870570 |
|  | 2023 | 425000 |  | 328601 |  | 36558 | 790159 |

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1&nbsp;&nbsp;&nbsp;&nbsp;For 2025, represents incentive compensation earned in 2025, including annual incentive (50 percent of total incentive), payable in 2026, and deferred incentive (50 percent of total incentive), which will be paid one-third annually, beginning in 2027. In addition, incentive compensation includes four percent interest, credited annually, earned on the 2022 and 2023 deferred incentives, and interest earned on the 2024 deferred incentive awards, based on annual ROE as of December 31, 2025. For 2023 and 2024, incentive compensation includes amounts under the previous EIPs as described in the 2024 Form 10-K. Both the deferred incentive and interest remain subject to the Bank's sustained achievement of all applicable safety and soundness measures and Compensation Committee's and Board of Directors' approvals at the time of payment.

2&nbsp;&nbsp;&nbsp;&nbsp;All earnings on non-qualified deferred compensation are at the market rate and therefore are not required to be included in this table.

3&nbsp;&nbsp;&nbsp;&nbsp;The components of this column for 2025 are provided in the "<u>[Components of All Other Compensation](#i8233154b031c43c3b75d53bd7c1434e0_2136)</u>" table within this Item 11.

4&nbsp;&nbsp;&nbsp;&nbsp;Mr. Livingston received a one-time bonus in 2024 and 2025 following the completion of his first and second year of employment with the Bank. Mr. Livingston's 2023 salary, non-equity incentive, and all other compensation are prorated based on the period of his employment with the Bank from January 17, 2023 through December 31, 2023. Mr. Livingston also received a one-time bonus in 2023 related to the start of his employment with the Bank.

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<u>[**Table of Contents**](#i6940522039644a7690f9aab973fdec20_7)</u> 

COMPONENTS OF ALL OTHER COMPENSATION

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| | | | | |
|:---|:---|:---|:---|:---|
| | Bank Contributions to Vested Defined Contribution Plans | Bank Contributions to Vested Defined Contribution Plans | | |
| NEO | DC Plan | NQDC Plan | Perquisites and Other Personal Benefits<sup>1</sup> | Total |
| Kristina K. Williams | $30494 | $453377 | $20511 | $504382 |
| James G. Livingston | 33876 | 109075 | 6727 | 149678 |
| William W. Osborn | 28110 | 121857 | 7626 | 157593 |
| Joelyn R. Jensen-Marren | 31805 | 107291 | 2404 | 141500 |
| Kevin T. Larkin | 35000 | 96498 | 8157 | 139655 |

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1&nbsp;&nbsp;&nbsp;&nbsp;Perquisites and other personal benefits for Ms. Williams included a car allowance, mobile technology allowance, service award, and life and long-term disability insurance premiums.

&nbsp;&nbsp;&nbsp;&nbsp;

**Benefits and Retirement Philosophy**

We consider benefits to be an important aspect of our ability to attract and retain qualified employees, and therefore we design our programs to be competitive with financial services businesses. The following is a summary of the retirement benefits that NEOs were eligible to receive.

QUALIFIED DEFINED CONTRIBUTION PLAN

All employees who have met the eligibility requirements may elect to participate in our DC Plan, a retirement savings plan qualified under the Internal Revenue Code. Employees (including NEOs) may receive a match on employee contributions at 100 percent up to six percent of eligible compensation. Employees are eligible for the match immediately, and all matching contributions are immediately 100 percent vested. All employees receive a discretionary Bank contribution of eligible compensation (generally four percent) to the DC Plan following the end of each calendar year. Vesting in the discretionary contribution is 100 percent at the completion of three years of service.

NON-QUALIFIED DEFINED CONTRIBUTION PLAN

Our NEOs are eligible to participate in a non-qualified defined contribution plan that is similar to the DC Plan, which includes the BEP, and as of 2024, was amended to include the SERP. The BEP ensures, among other things, that participants whose benefits under the DC Plan would otherwise be restricted by certain provisions of the Internal Revenue Code are able to make elective pre-tax deferrals and to receive a matching contribution relating to such deferrals. The investment returns credited to a participating NEO's account are at the market rate for the NEO's selected investment. Aggregate earnings are calculated by subtracting the 2024 year-end balance from the 2025 year-end balance, less the NEO's and Bank's contributions. The Bank matches 100 percent of NEOs' contributions up to six percent of salary and annual incentive deferrals. Participants also receive a discretionary Bank contribution (generally four percent) of eligible compensation above the limits set by the Internal Revenue Code into the BEP following the end of each calendar year. In addition, we may elect to provide a discretionary contribution to an executive upon approval by the Board of Directors and subject to non-objection by the Finance Agency.

In addition to the BEP, the Bank began offering the SERP in 2024. SERP contributions made by the Bank are between six percent and 15 percent of eligible earnings for the CEO and between six percent and 10 percent of eligible earnings for all other NEOs and are not subject to a matching contribution by the NEO. Eligible earnings includes base salary and incentive compensation. For additional information, refer to the First Amendment to the Seventh Amended and Restated Benefit Equalization Plan set forth in "<u>[Item 15. Exhibits and Financial Statements Schedules](#i6940522039644a7690f9aab973fdec20_322)</u>."

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| 2025 Non-Qualified Deferred Compensation Table | 2025 Non-Qualified Deferred Compensation Table | 2025 Non-Qualified Deferred Compensation Table | 2025 Non-Qualified Deferred Compensation Table | 2025 Non-Qualified Deferred Compensation Table | 2025 Non-Qualified Deferred Compensation Table |
| NEO | Executive <br>Contributions <br>In Last FY<sup>1</sup> | Bank <br>Contributions<br>In Last FY<sup>2</sup> | Aggregate <br>Earnings (Losses)<br>In Last FY<sup>3</sup> | Aggregate Withdrawals/Distributions In Last FY | Aggregate <br>Balance<br>At Last FYE<sup>4</sup> |
| Kristina K. Williams | $170902 | $453377 | $209254 | $— | $3292351 |
| James G. Livingston | 262387 | 109075 | 166538 | (20436) | 1205966 |
| William W. Osborn | 52790 | 121857 | 56866 |  | 425467 |
| Joelyn R. Jensen-Marren | 36900 | 107291 | 14930 |  | 186785 |
| Kevin T. Larkin | 25074 | 96498 | 11873 |  | 119478 |

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1&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent NEO's contributions for 2025, which includes the base salary deferral into the BEP during 2025 as well as the amount of the 2025 incentive the NEO deferred into the BEP in 2026. Amounts shown are included in either the "Salary" or "Non-Equity Incentive" column of the "<u>[Summary Compensation Table](#i8233154b031c43c3b75d53bd7c1434e0_2137)</u>" in this Item 11.

2&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent the Bank's contributions for 2025, which include the base salary match, the 2025 incentive match, and discretionary BEP and SERP contributions. Amounts shown are included in the "All Other Compensation" column of the "<u>[Summary Compensation Table](#i8233154b031c43c3b75d53bd7c1434e0_2137)</u>" in this Item 11.

3&nbsp;&nbsp;&nbsp;&nbsp;All earnings on non-qualified deferred compensation are at the market rate. As a result, these amounts are not shown in the "<u>[Summary Compensation Tabl](#i8233154b031c43c3b75d53bd7c1434e0_2137)</u>e" in this Item 11.

4&nbsp;&nbsp;&nbsp;&nbsp;Amounts represent the NEO's balances on December 31, 2025, and do not include contributions deposited into the NEOs' account subsequent to the last fiscal year-end. Ms. Williams' aggregate balance includes $2,702,821 of contributions reported in a prior year "<u>[Summary Compensation Table](#i8233154b031c43c3b75d53bd7c1434e0_2137)</u>". Mr. Livingston's aggregate balance includes $674,563 of contributions reported in a prior year "Summary Compensation Table" and also includes contributions from when he served on the Bank's Board of Directors. Mr. Osborn's aggregate balance includes $270,404 of contributions reported in a prior year "Summary Compensation Table". Ms. Jensen-Marren's aggregate balance includes $140,411 of contributions reported in a prior year "Summary Compensation Table". Mr. Larkin's aggregate balance includes $82,982 of contributions reported in a prior year "Summary Compensation Table".

**CEO Compensation Pay Ratio**

As required by Item 402(u) of Regulation S-K, we are providing the following information:

For 2025, our last completed fiscal year:

&nbsp;&nbsp;&nbsp;&nbsp;i.The median of the annual total compensation of all employees of the Bank (other than Ms. Williams), was $154,732; and

&nbsp;&nbsp;&nbsp;&nbsp;ii.The annual total compensation of Ms. Williams, our President and CEO, was $2,840,603.

Based on this information, the ratio for 2025 of the annual total compensation of our President and CEO to the median of the annual total compensation of all employees is 18 to 1.

We identified our median employee and calculated our pay ratio in accordance with SEC rules and methods for disclosure as described below.

&nbsp;&nbsp;&nbsp;&nbsp;i.We identified our employee population as of December 31, 2025, including any full-time, part-time, temporary, and seasonal employees employed on that date. This date was selected because it aligned with the calendar and fiscal year end and allowed us to identify employees in a reasonably efficient manner.

&nbsp;&nbsp;&nbsp;&nbsp;ii.To find our median employee, excluding our President and CEO, we reviewed the 2025 annual salary for each employee that was employed as of December 31, 2025, and ranked all employees by that consistently applied compensation measure. In making this determination, we annualized the salary of full-time and part-time employees who were employed on December 31, 2025, but did not work for us the entire year. No full-time equivalent adjustments were made for part-time employees. Using this population, we then identified the initial median employee, and the next five employees lower and higher than that initial median employee, resulting in a total pool of 11 employees. We then calculated the 2025 total compensation, annualized if applicable, for each of these 11 employees in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K and in the same manner as for our President and CEO. We ranked the 2025 total compensation for each of these 11 employees, and identified our median employee.

&nbsp;&nbsp;&nbsp;&nbsp;iii.With respect to the annual total compensation of our President and CEO, we used the 2025 amount reported in the "Total" column of our "<u>[Summary Compensation Table](#i8233154b031c43c3b75d53bd7c1434e0_2137)</u>" in this Item 11.

------

**Potential Payments Upon Termination or Change of Control**

The definitions below are applicable to our President and CEO, who is the only NEO with an employment agreement. For purposes of the following discussion regarding potential payments upon termination or change of control, the following are the definitions of "Cause," "Good Reason," "Disability," and "Change of Control."

"Cause" generally means a felony conviction, a willful act of misconduct that materially impairs the Bank's business or goodwill or causes material damage, a willful breach of certain representations in the employment agreement, a willful and continued failure to perform material duties, a willful material violation of the Bank's Code of Ethics, or receipt by the Bank of any regulatory order that the NEO be terminated or the NEO's authority be materially reduced.

"Good Reason" generally means a reduction in the NEO's base salary or incentive plan bonus opportunity, unless as part of a nondiscriminatory cost reduction applicable to the Bank's total compensation budget; a reduction in the NEO's corporate officer title, a material change by the Bank in the geographic location in which the NEO is required to perform services, a material breach of the employment agreement, as applicable, by the Bank, or as otherwise defined in the Bank's EIP.

"Disability" means the NEO has received benefits under a disability plan sponsored by the Bank for a period of not less than three months by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months and which has rendered the NEO incapable of performing their duties.

"Change of Control" means a merger, reorganization, or consolidation of the Bank with or into another FHLBank or other entity, a sale or transfer of all or substantially all of the business or assets of the Bank to another FHLBank or other entity, the purchase by the Bank or transfer to the Bank of all or substantially all of the business or assets of another FHLBank, or the liquidation of the Bank.

All NEOs other than our President and CEO are subject to the Bank's Executive Severance Plan and other Bank policies. Copies of the employment agreement for our President and CEO, as well as the Executive Severance Plan, are set forth in "<u>[Item 15. Exhibits and Financial Statements Schedules](#i6940522039644a7690f9aab973fdec20_322)</u>", and summarized below.

TERMINATION FOR CAUSE OR WITHOUT GOOD REASON

If an NEO's employment is terminated by us for Cause or by the NEO without Good Reason, the NEO may be entitled to the following:

&nbsp;&nbsp;&nbsp;&nbsp;i.&nbsp;&nbsp;&nbsp;&nbsp;Base salary accrued through the date of termination;

&nbsp;&nbsp;&nbsp;&nbsp;ii.&nbsp;&nbsp;&nbsp;&nbsp;Accrued but unpaid incentive plan award(s) earned in a year prior to the year of termination and due to be paid in the year in which termination occurs for the President and CEO, all other NEOs will be paid subject to a separation agreement, and will be paid in accordance with the Bank's EIP;

&nbsp;&nbsp;&nbsp;&nbsp;iii.&nbsp;&nbsp;&nbsp;&nbsp;Accrued and earned PTO through the date of termination; and/or

&nbsp;&nbsp;&nbsp;&nbsp;iv.&nbsp;&nbsp;&nbsp;&nbsp;All other vested benefits under the terms of our employee benefit plans, subject to the terms of such plans.

------

Assuming one or more of the previously discussed events triggering receipt of termination payments had occurred as of December 31, 2025, the total amounts payable to our NEOs are outlined in the table below:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Termination For Cause or Without Good Reason | Termination For Cause or Without Good Reason | Termination For Cause or Without Good Reason | Termination For Cause or Without Good Reason | Termination For Cause or Without Good Reason | Termination For Cause or Without Good Reason |
| NEO | Severance Pay<sup>1</sup> | Annual Incentive<sup>2</sup> | Deferred Incentive<sup>2</sup> | PTO Payout<sup>3</sup> | Total |
| Kristina K. Williams | $— | $— | $— | $26949 | $26949 |
| James G. Livingston |  |  |  | 3035 | 3035 |
| William W. Osborn |  |  |  | 29772 | 29772 |
| Joelyn R. Jensen-Marren |  |  |  | 8671 | 8671 |
| Kevin T. Larkin |  |  |  | 10102 | 10102 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Termination under these circumstances would not result in severance payments from the Bank but would result in payment of salary earned through December 31, 2025, as reflected under the "Salary" column of the "<u>[Summary Compensation Table](#i8233154b031c43c3b75d53bd7c1434e0_2137)</u>" in this Item 11.

2&nbsp;&nbsp;&nbsp;&nbsp;Termination under these circumstances would not result in an incentive award payment since the award would have already been received as of December 31, 2025.

3&nbsp;&nbsp;&nbsp;&nbsp;This amount represents accrued but unused PTO and would be paid in a lump sum upon termination. All NEOs are eligible to receive a payout in connection with unused PTO according to Bank policies.

TERMINATION WITHOUT CAUSE, FOR GOOD REASON, OR FOLLOWING A CHANGE IN CONTROL

If, however, the NEO's employment is terminated by us without Cause, by the NEO for Good Reason, or following a Change in Control, in addition to the payouts previously mentioned, the NEO may be entitled to the following:

&nbsp;&nbsp;&nbsp;&nbsp;i.&nbsp;&nbsp;&nbsp;&nbsp;Two times the annual base salary in effect on the date of termination for the President and CEO, or, in the case that the termination occurs within 24 months following a Change of Control, 2.99 times the annual base salary in effect on the date of termination for the President and CEO;

&nbsp;&nbsp;&nbsp;&nbsp;ii.&nbsp;&nbsp;&nbsp;&nbsp;Minimum of 26 weeks of base salary, up to a maximum of 52 weeks of base salary, with the actual payment amount subject to the President and CEO's discretion, for NEOs other than the President and CEO;

&nbsp;&nbsp;&nbsp;&nbsp;iii. &nbsp;&nbsp;&nbsp;&nbsp;One times the targeted non-deferred EIP award in effect for the calendar year in which the date of termination occurs, or, in the case that the termination occurs within 24 months following a Change of Control, 2.99 times the targeted non-deferred plan award in effect for the calendar year in which the date of termination occurs for the President and CEO;

&nbsp;&nbsp;&nbsp;&nbsp;iv.&nbsp;&nbsp;&nbsp;&nbsp;The EIP award for the calendar year in which the date of termination occurs and prorated for the portion of the calendar year in which the NEO was employed;

&nbsp;&nbsp;&nbsp;&nbsp;v.&nbsp;&nbsp;&nbsp;&nbsp;The accrued but unpaid incentive plan awards covering periods prior to the one in which the NEO's employment was terminated, calculated in accordance with the terms of the EIP; and

&nbsp;&nbsp;&nbsp;&nbsp;vi.&nbsp;&nbsp;&nbsp;&nbsp;Any benefits mandated under any applicable health care continuation laws, provided that the Bank will continue paying its portion of the medical and/or dental insurance premiums for the President and CEO for the one-year period following the date of termination, and medical benefits continuation for six months following the date of termination for all other NEOs.

Payments of all accrued amounts, other than EIP award amounts, shall generally be paid in a lump sum within ten days or no later than the first payroll date on or after the President and CEO's date of termination, and for all other NEOs, payment will be made in accordance with the Bank's Executive Severance Plan. Payment of all EIP award amounts, if any, shall be paid as otherwise provided under the EIP.

------

Assuming one or more of the previously discussed events triggering receipt of termination payments had occurred as of December 31, 2025, the total amounts payable to our NEOs are outlined in the table below:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Termination Without Cause or For Good Reason | Termination Without Cause or For Good Reason | Termination Without Cause or For Good Reason | Termination Without Cause or For Good Reason | Termination Without Cause or For Good Reason | Termination Without Cause or For Good Reason |
| NEO | Severance Pay<sup>1</sup> | Annual Incentive<sup>2</sup> | Deferred Incentive<sup>2</sup> | PTO Payout<sup>3</sup> | Total |
| Kristina K. Williams | $2335496 | $1008373 | $2375056 | $26949 | $5745874 |
| James G. Livingston | 450840 | 164101 | 558965 | 3035 | 1176941 |
| William W. Osborn | 483785 | 176094 | 808632 | 29772 | 1498283 |
| Joelyn R. Jensen-Marren | 450883 | 164117 | 727104 | 8671 | 1350775 |
| Kevin T. Larkin | 437750 | 159336 | 713618 | 10102 | 1320806 |

---

1 &nbsp;&nbsp;&nbsp;&nbsp;This amount for NEOs other than the President and CEO represents the maximum of 52 weeks of base salary, as allowed by the Bank's Executive Severance Plan. Actual amounts awarded may be reduced based on criteria set forth in the Bank's Executive Severance Plan, as determined by the President and CEO. Therefore, amounts actually awarded may be less than the amounts listed. &nbsp;&nbsp;&nbsp;&nbsp;

2&nbsp;&nbsp;&nbsp;&nbsp;The annual and deferred incentive awards represent the maximum allowable payout; however, the actual payout is subject to the Compensation Committee's approval and non-objection by the Finance Agency, based on criteria set forth in the Bank's EIP. Therefore, amounts actually awarded may be less than the amounts listed.

3&nbsp;&nbsp;&nbsp;&nbsp;This amount represents accrued but unused PTO and would be paid in a lump sum upon termination. All NEOs are eligible to receive a payout in connection with unused PTO in accordance with the Bank's Executive Severance Plan.

Assuming one or more of the previously discussed events triggering receipt of termination payments had occurred as of December 31, 2025, the total amounts payable to our NEOs are outlined in the table below:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Termination Following Change in Control | Termination Following Change in Control | Termination Following Change in Control | Termination Following Change in Control | Termination Following Change in Control | Termination Following Change in Control |
| NEO | Severance Pay<sup>1</sup> | Annual Incentive<sup>2</sup> | Deferred Incentive<sup>2</sup> | PTO Payout<sup>3</sup> | Total |
| Kristina K. Williams | $3491567 | $1937900 | $2375056 | $26949 | $7831472 |
| James G. Livingston | 450840 | 164101 | 558965 | 3035 | 1176941 |
| William W. Osborn | 483785 | 176094 | 808632 | 29772 | 1498283 |
| Joelyn R. Jensen-Marren | 450883 | 164117 | 727104 | 8671 | 1350775 |
| Kevin T. Larkin | 437750 | 159336 | 713618 | 10102 | 1320806 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;This amount for NEOs other than the President and CEO represents the maximum of 52 weeks of base salary, as allowed by the Bank's Executive Severance Plan. Actual amounts awarded may be reduced based on criteria set forth in the Bank's Executive Severance Plan, as determined by the President and CEO. Therefore, amounts actually awarded may be less than the amounts listed.

2&nbsp;&nbsp;&nbsp;&nbsp;The annual and deferred incentive awards represent the maximum allowable payout; however, the actual payout is subject to the Compensation Committee's approval and non-objection by the Finance Agency, based on criteria set forth in the Bank's EIP. Therefore, amounts actually awarded may be less than the amounts listed.

3&nbsp;&nbsp;&nbsp;&nbsp;This amount represents accrued but unused PTO and would be paid in a lump sum upon termination. All NEOs are eligible to receive a payout in connection with unused PTO in accordance with the Bank's Executive Severance Plan.

TERMINATION FOR DEATH, DISABILITY, OR RETIREMENT

If the NEO's employment is terminated due to death, disability, or qualifying retirement, in addition to the payouts previously mentioned under the section entitled "Termination For Cause or Without Good Reason," the NEO may be entitled to the following:

&nbsp;&nbsp;&nbsp;&nbsp;i.&nbsp;&nbsp;&nbsp;&nbsp;The EIP award for the calendar year in which the date of termination occurs and prorated for the portion of the calendar year in which the NEO was employed;

&nbsp;&nbsp;&nbsp;&nbsp;ii.&nbsp;&nbsp;&nbsp;&nbsp;To the extent not already paid to the NEO, the accrued but unpaid incentive plan awards covering periods prior to the one in which the NEO's employment was terminated; and

&nbsp;&nbsp;&nbsp;&nbsp;iii.&nbsp;&nbsp;&nbsp;&nbsp;Other coverage continuation rights that are available to such employees upon death, disability, or retirement, as provided for under the terms of such plans.

Payment of all accrued amounts, other than EIP award amounts, shall be paid in a lump sum within ten days or no later than the first payroll date on or after the President and CEO's date of termination, and for all other NEOs, payment will be made in accordance with the Bank's Executive Severance Plan. Payment of all EIP award amounts, if any, shall be paid as otherwise provided under the applicable EIP.

------

Assuming one or more of the previously discussed events for the receipt of termination payments had occurred as of December 31, 2025, the total amounts payable to our NEOs are outlined in the table below:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Termination by Death, Disability, or Retirement | Termination by Death, Disability, or Retirement | Termination by Death, Disability, or Retirement | Termination by Death, Disability, or Retirement | Termination by Death, Disability, or Retirement | Termination by Death, Disability, or Retirement |
| NEO | Severance Pay | Annual Incentive | Deferred Incentive<sup>1</sup> | PTO Payout<sup>2</sup> | Total |
| Kristina K. Williams | $— | $541275 | $2375056 | $26949 | $2943280 |
| James G. Livingston |  | 164101 | 558965 | 3035 | 726101 |
| William W. Osborn |  | 176094 | 808632 | 29772 | 1014498 |
| Joelyn R. Jensen-Marren |  | 164117 | 727104 | 8671 | 899892 |
| Kevin T. Larkin |  | 159336 | 713618 | 10102 | 883056 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;The deferred incentive awards represent the maximum allowable payout; however, the actual payout is subject to the Compensation Committee's approval and non-objection by the Finance Agency, based on criteria set forth in the Bank's EIP. Therefore, amounts actually awarded may be less than the amounts listed.

2&nbsp;&nbsp;&nbsp;&nbsp;This amount represents accrued but unused PTO and would be paid in a lump sum upon termination. All NEOs are eligible to receive the amounts disclosed in accordance with Bank policies.

EMPLOYMENT AGREEMENT BETWEEN KRISTINA K. WILLIAMS AND THE BANK

The Bank entered into an employment agreement with Kristina K. Williams, effective January 20, 2020, in order to establish her duties and compensation and to provide for her employment as President and CEO of the Bank.

The employment agreement provides that the Bank would initially pay Ms. Williams a base salary of $850,000, subject to adjustment as described in the employment agreement.

Subject to review by the Finance Agency, Ms. Williams' incentive target will generally not be set lower than 85 percent of her base salary. The Bank paid, or reimbursed Ms. Williams for, all reasonable relocation expenses incurred by Ms. Williams in relocation to the Des Moines area up to the maximum of $250,000. Ms. Williams is also eligible for certain perquisites, including a car allowance in the amount of $750 per month.

Ms. Williams' employment agreement provides that:

&nbsp;&nbsp;&nbsp;&nbsp;• the Bank or Ms. Williams may terminate employment for any reason (other than Good Reason or Cause) following 60 days' written notice to the other party;

&nbsp;&nbsp;&nbsp;&nbsp;• the Bank may terminate for Cause immediately following written notice to Ms. Williams; and

&nbsp;&nbsp;&nbsp;&nbsp;• Ms. Williams may terminate for Good Reason following written notice to the Bank;

in each case, in accordance with the procedures set forth in the employment agreement.

Amounts payable under the employment agreement are subject to reduction in the event the amounts constitute an "excess parachute payment" under Section 280G of the Internal Revenue Code.

*Termination for Cause or Without Good Reason* 

If Ms. Williams' employment is terminated by the Bank for Cause or by Ms. Williams without Good Reason, the employment agreement entitles Ms. Williams to the benefits set forth under the heading "Termination for Cause or Without Good Reason."

*Termination Without Cause, for Good Reason, Following a Change of Control, or Within a Specified Period of Time Following the Effective Date of the Employment Agreement* 

If Ms. Williams' employment is terminated by the Bank without Cause or by Ms. Williams for Good Reason, in addition to the payouts previously mentioned under "Termination for Cause or Without Good Reason," the employment agreement entitles Ms. Williams to additional amounts, including the benefits set forth under the heading "Termination without Cause, for Good Reason, or following a Change in Control."

------

*Termination for Death, Disability, or Retirement* 

If Ms. Williams' employment is terminated due to death, disability, or qualifying retirement, in addition to the payouts described in the section entitled "Termination for Cause or Without Good Reason," she would also be entitled to the benefits set forth under the heading "Termination for Death, Disability or Retirement."

**Director Compensation** 

During 2025, the Board of Directors held 11 board meetings and 54 committee meetings. Pursuant to our Director Fee Policy, Directors receive one quarter of the annual compensation on the last business day of each calendar quarter. If it is determined at the end of the calendar year that a Director has attended less than 75 percent of the meetings they were required to attend during the year, the Director will not receive the fourth quarter payment for such calendar year.

Directors are expected to attend all Board meetings and meetings of the Committees on which they serve, and to remain engaged and actively participate in all meetings. In addition to our right to withhold fourth quarter annual compensation from a Director, the Board of Directors directs the Corporate Secretary to make any other appropriate adjustments in the payments to any Director who regularly fails to attend Board meetings or meetings of Committees on which the Director serves, or who consistently demonstrates a lack of participation in or preparation for such meetings, to ensure that no Director is paid fees that do not reflect that Director's performance of his/her duties. To assist the Board in making such determinations, the Corporate Secretary will, on a quarterly basis and prior to payment of the most recently completed quarter's Director fees, review the attendance of each Director during the quarter and raise any attendance issues identified with the Board Chair. In the event the potential issue involves the Board Chair, the Corporate Secretary will raise such issue with the Board Vice Chair.

Directors are eligible to participate in the Bank's Deferral Plan for Directors. Under this plan, directors may elect to defer all or a portion of their directors' fees. See the Bank's Deferral Plan for Directors set forth in "<u>[Item 15. Exhibits and Financial Statements Schedules](#i6940522039644a7690f9aab973fdec20_322)</u>", for additional information.

The total expenses paid on behalf of the Board of Directors for travel and other reimbursed expenses for 2025 was $354 thousand and annual compensation paid to the Board of Directors, by position, for 2025 was as follows:

---

| | |
|:---|:---|
| Board of Director Position | 2025 |
| Chair | $162500 |
| Vice Chair | 142000 |
| Audit, Risk and Compliance, and Compensation Committee Chairs | 137000 |
| All Other Committee Chairs | 130000 |
| All Other Directors | 123000 |

---

------

The following table sets forth each Director's compensation for the year ended December 31, 2025:

---

| | |
|:---|:---|
| Director Compensation | Director Compensation |
| Director Name | Fees Earned Or<br>Paid In Cash |
| Karl A. Bollingberg (Chair) | $162500 |
| John A. Klebba (Vice Chair) | 142000 |
| Ruth B. Bennett | 123000 |
| Steven L. Bumann | 123000 |
| Cleon P. Butterfield | 123000 |
| Douglas L. DeFries | 137000 |
| Kim R. DeVore | 123000 |
| Edward A. Garding | 123000 |
| Amy K. Johnson | 123000 |
| Jon M. Jones | 137000 |
| Joe R. Kesler | 123000 |
| Wan-Chong Kung | 130000 |
| Russell J. Lau | 123000 |
| Lauren M. MacVay | 137000 |
| Elsie M. Meeks | 130000 |
| Jason A. Meyerhoeffer | 130000 |
| Siva G. Narendra | 123000 |
| Carol K. Nelson | 130000 |
| Jeff L. Plagge | 123000 |
| Lisa A. Stange | 123000 |
| Matt C. Stephenson | 123000 |
| Robert J. Vogel | 123000 |

---

The Compensation Committee approved the Director Fee Policy for 2026. This policy is listed as an exhibit to this annual report on Form 10-K. Refer to "<u>[Item 15. Exhibits and Financial Statement Schedules](#i6940522039644a7690f9aab973fdec20_322)</u>" for additional information.

**Compensation Committee Report**

The Compensation Committee reviewed and discussed the 2025 Compensation Discussion and Analysis set forth in Item 11 with management. Based on such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this annual report on Form 10-K. The Compensation Committee includes the following individuals:

---

| |
|:---|
| Compensation Committee |
| Amy K. Johnson (Chair) |
| Matt C. Stephenson (Vice Chair) |
| Jon M. Jones |
| Elsie M. Meeks |
| Carol K. Nelson |
| Matt C. Packard |

---

------

**<u>ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS</u>**

The following table presents members (or combination of members within the same holding company) holding five percent or more of our outstanding capital stock at February 28, 2026 (shares in thousands):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name | Address | City | State | Shares of Capital Stock | % of Total Capital Stock |
| Wells Fargo, N.A. | 3201 N. 4th Ave | Sioux Falls  | SD | 13712 | 18.8% |
| Athene Annuity and Life Company | 7700 Mills Civic Parkway | West Des Moines | IA | 11855 | 16.2 |
| Superior Guaranty Insurance Company<sup>1</sup> | 76 Saint Paul St. | Burlington | VT | 37 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;\* |
|  |  |  |  | 25604 | 35.0 |
| All others |  |  |  | 47487 | 65.0 |
| Total capital stock |  |  |  | 73091 | 100.0% |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Superior Guaranty Insurance Company is an affiliate of Wells Fargo Bank, N.A.

\*&nbsp;&nbsp;&nbsp;&nbsp;Amount is less than 0.01 percent.

Additionally, due to the fact that a majority of our Board of Directors is nominated and elected from our membership, these member directors are officers or directors of member institutions that own our capital stock. The following table presents total outstanding capital stock owned by those members who had an officer or director serving on our Board of Directors at February 28, 2026 (shares in thousands):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name | Address | City | State | Shares of Capital Stock | % of Total Capital Stock |
| Rogue Credit Union | 1370 Center Dr. | Medford | OR | 251 | 0.34% |
| First Federal Savings Bank of Twin Falls | 383 Shoshone Street N | Twin Falls | ID | 49 | 0.07 |
| Northwest Bank | 705 Grand Avenue | Spencer | IA | 43 | 0.06 |
| Cornerstone Bank | 2280 45th Street S | Fargo | ND | 36 | 0.05 |
| Finance Factors, Ltd | 1164 Bishop St. | Honolulu | HI | 28 | 0.04 |
| First Montana Bank | 201 N Higgins Ave | Missoula | MT | 25 | 0.03 |
| New Market Bank | 101 Old Town Road | Elko New Market | MN | 19 | 0.03 |
| Central Bank | 75 N. University Ave. | Provo | UT | 12 | 0.02 |
| Legends Bank | 200 E Main St. | Linn | MO | 4 | 0.01 |
| Jonah Bank of Wyoming | 777 W. 1st Street | Casper | WY | 3 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;\* |
| Great Plains Bank | 3915 6th Ave SE | Aberdeen | SD | 2 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;\* |
| True North Federal Credit Union | 2777 Postal Way | Juneau | AK | 1 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;\* |
| Twin City Bank | 729 Vandercook Way | Longview | WA | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;\* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;\* |
|  |  |  |  | 473 | 0.65 |
| All others |  |  |  | 72618 | 99.35 |
| Total capital stock |  |  |  | 73091 | 100.00% |

---

\*&nbsp;&nbsp;&nbsp;&nbsp;The number of shares of capital stock is less than one thousand and/or the percentage of total capital stock is less than 0.01 percent.

------

**<u>ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE</u>**

**TRANSACTIONS WITH RELATED PERSONS**

The Bank is a cooperative. This means the Bank is owned by its customers, whom the Bank calls members. As a condition of membership in the Bank, all members must purchase and maintain membership capital stock based on a percentage of their total assets, subject to a minimum and maximum amount, as of the preceding December 31st. Each member is also required to purchase and maintain activity-based capital stock to support certain business activities with the Bank. All transactions with stockholders are entered into in the ordinary course of business.

In the normal course of business, the Bank extends credit to its members whose directors and officers serve as Bank directors (Directors' Financial Institutions). Finance Agency regulations require that transactions with Directors' Financial Institutions be made on the same terms and conditions as those with any other member.

For the year ended December 31, 2025, the review and approval of transactions with related persons was governed by our Code. Under the Code, each director is required to disclose to the Board all actual or apparent conflicts of interest, including any personal financial interest that he or she has, as well as such interests of any immediate family member or business associate of the director known to the director, in any matter to be considered by the Board or in which another person does, or proposes to do, business with the Bank. Following such disclosure, the Board is empowered to determine whether an actual conflict exists. In the event the Board determines the existence of a conflict with respect to any matter, the affected director is required to be recused from all further considerations relating to that matter. The Bank's CLCO, CHRO, CAE, or the Board, as appropriate, shall be responsible for interpreting the Code and rendering final rulings regarding violations of this Code.

The Code requires that all directors and employees avoid conflicts of interest, or the appearance of conflicts of interest. In particular, subject to limited exceptions for interests arising through ownership of mutual funds and certain financial interests acquired prior to employment by the Bank, no employee may have a financial interest in or financial relationship with any of our members or other company doing business or considering doing business with the Bank that is not transacted in the ordinary course of the member's business or, in the case of an extension of credit, involves more than the normal risk of repayment or of loss to the member. In addition, the Code also provides that employees and directors are expected to perform their duties fairly and impartially and without discrimination in favor of or against any member institution. Employees are required to annually certify compliance with these and all other Code provisions.

**DIRECTOR INDEPENDENCE**

**General**

As of the date of this annual report on Form 10-K, we have 22 directors, all of whom were elected by our member institutions in accordance with Finance Agency regulations. All directors are independent of management from the standpoint they are not our employees, officers, or stockholders. Only member institutions can own our capital stock. Thus, our directors do not personally own our stock. In addition, we are required to determine whether our directors are independent under three distinct director independence standards. Finance Agency regulations and the Exchange Act provide independence criteria for directors who serve as members of our Audit Committee. Additionally, SEC rules require our Board of Directors to apply the independence criteria of a national securities exchange or automated quotation system in assessing the independence of our directors.

**Finance Agency Regulations**

The Finance Agency director independence standards prohibit individuals from serving as members of our Audit Committee if they have one or more "disqualifying relationships" with us or our management that would interfere with the exercise of that individual's independent judgment. Disqualifying relationships considered by our Board are (i) employment with us at any time during the last five years, (ii) acceptance of compensation from us other than for service as a director, (iii) being a consultant, advisor, promoter, underwriter, or legal counsel for us at any time within the last five years, and (iv) being an immediate family member of an individual who is or who has been, within the past five years, one of our executive officers. The Board assesses the independence of all directors under the Finance Agency's independence standards, regardless of whether they serve on our Audit Committee. As of February 28, 2026, all of our directors, including all members of our Audit Committee, were independent under these criteria.

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**Exchange Act**

Section 10A(m) of the Exchange Act sets forth the independence requirements of directors serving on the Audit Committee of a reporting company. Under Section 10A(m), in order to be considered independent, a member of the Audit Committee may not, other than in his or her capacity as a member of the Board or any other Board Committee (i) accept any consulting, advisory, or other compensation from us or (ii) be an affiliated person of the Bank. As of February 28, 2026, all of our directors, including all members of our Audit Committee, were independent under these criteria.

**SEC Rules**

In addition, pursuant to SEC rules, we adopted the independence standards of the NYSE to determine which of our directors are independent for SEC disclosure purposes. In making an affirmative determination of the independence of each director, the Board first applied the objective measures of the NYSE independence standards to assist the Board in determining whether a particular director has a material relationship with us.

Based upon the fact that each of our Member Directors are officers or directors of member institutions, and that each such member routinely engages in transactions with us, the Board determined none of the Member Directors on the Board meet the NYSE independence standards. In making this determination, the Board recognized a Member Director could meet the NYSE objective standards on any particular day. However, because the volume of business between a Member Director's institution and us can change frequently, and because we generally encourage increased business with all members, the Board determined to avoid distinguishing among the Member Directors based upon the amount of business conducted with us and our respective members at a specific time, resulting in the Board's categorical finding that no Member Director is independent under an analysis using the NYSE standards.

With regard to our Independent Directors, the Board determined that each is independent in accordance with NYSE standards. In concluding our nine Independent Directors are independent under the NYSE rules, the Board first determined all Independent Directors met the objective NYSE independence standards. In further determining none of its Independent Directors had a material relationship with us, the Board noted the Independent Directors are specifically prohibited from being an officer of the Bank or an officer or director of a member.

Our Board has a standing Audit Committee. All Audit Committee members are independent under the Finance Agency's independence standards and the independence standards under Section 10A(m) of the Exchange Act in accordance with the Housing Act. For the reasons described above, our Board determined none of the current Member Directors serving on the Audit Committee are independent using the NYSE independence standards. Our Board determined, however, the Independent Directors serving on the Audit Committee are independent under the NYSE independence standards.

**Compensation Committee**

The Board has a standing Compensation Committee. Our Board determined all members of the Compensation Committee are independent under the Finance Agency's independence standards. For the reasons described above, our Board determined none of the current Member Directors serving on the Compensation Committee are independent using the NYSE independence standards. Our Board determined the Independent Directors serving on the Compensation Committee are independent under the NYSE independence standards.

Refer to "<u>[Item 10. Directors, Executive Officers and Corporate Governance](#i6940522039644a7690f9aab973fdec20_265)</u>" for additional information on our Board composition.

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**<u>ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES</u>**

The Audit Committee pre-approves all audit and permitted non-audit services performed by the Bank's external audit firm. The Audit Committee may delegate pre-approval authority to a member of the Audit Committee for services with fees below $10,000; however any decisions made must be presented to the Audit Committee at its next regularly scheduled meeting.

The following table sets forth the aggregate fees billed or to be billed by PwC (dollars in thousands):

---

| | | |
|:---|:---|:---|
| | For the Years Ended December 31, | For the Years Ended December 31, |
| | 2025 | 2024 |
| Audit fees<sup>1</sup> | $1084 | $1138 |
| Audit-related fees<sup>2</sup> | 83 | 97 |
| All other fees | 2 | 2 |
| Total | $1169 | $1237 |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Represents fees incurred in connection with the annual audit of our financial statements and internal control over financial reporting and quarterly review of our financial statements. In addition to these fees, we incurred assessments of $58 thousand and $88 thousand from the Office of Finance for audit fees on the Combined Financial Report for the years ended December 31, 2025 and 2024.

2&nbsp;&nbsp;&nbsp;&nbsp;Primarily represents fees for participation in and presentations at conferences and/or technical accounting consultations.

------

**<u>PART IV</u>**

**<u>ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES</u>**

**(a) Financial Statements**

The financial statements are set forth in Item 8 of this annual report on Form 10-K.

**(b) Exhibits**

---

| | |
|:---|:---|
| 3.1 | <u>[Organization Certificate of the Federal Home Loan Bank of Des Moines, as amended and restated effective May 31, 2015](https://www.sec.gov/Archives/edgar/data/1325814/000132581415000102/exhibit31organizationalcer.htm)</u><sup>1</sup> |
| 3.2 | <u>[Bylaws of the Federal Home Loan Bank of Des Moines, as amended and restated effective December 8, 2021](https://www.sec.gov/Archives/edgar/data/1325814/000132581425000046/bylawsofthefederalhomelo.htm)</u><sup>2</sup> |
| 4.1 | <u>[Federal Home Loan Bank of Des Moines Capital Plan, as amended, approved by the Federal Housing Finance Agency on May 31, 2015](https://www.sec.gov/Archives/edgar/data/1325814/000132581424000046/capitalplan12-2023.htm)</u><sup>3</sup> |
| 4.2 | <u>[Description of Federal Home Loan Bank of Des Moines Capital Stock](https://www.sec.gov/Archives/edgar/data/1325814/000132581424000046/exhibit42-descriptionoffhl.htm)</u><sup>3</sup> |
| 10.1 | <u>[Employment Agreement with Kristina K. Williams, effective January 20, 2020](https://www.sec.gov/Archives/edgar/data/1325814/000132581420000135/exhibit101ceoemploymentagr.htm)</u><sup>4</sup> |
| 10.2 | <u>[Form of Indemnification Agreement](https://www.sec.gov/Archives/edgar/data/1325814/000132581422000031/exhibit102indemnificationa.htm)</u><sup>5</sup> |
| 10.3 | <u>[Joint Capital Enhancement Agreement, as amended, effective August 5, 2011](https://www.sec.gov/Archives/edgar/data/1325814/000132581411000157/jcea_amendment.htm)</u><sup>6</sup> |
| 10.4 | <u>[Federal Home Loan Bank of Des Moines Seventh Amended and Restated Benefit Equalization Plan, effective January 1, 2021](https://www.sec.gov/Archives/edgar/data/1325814/000132581421000022/a14c-7thamendedbepjanuar.htm)</u><sup>7</sup> |
| 10.5 | <u>[Federal Home Loan Bank of Des Moines Executive Incentive Plan, effective January 1, 2025](https://www.sec.gov/Archives/edgar/data/1325814/000132581425000094/exhibit101eip-amended.htm)</u><sup>8</sup> |
| 10.6 | <u>[2026 Director Fee Policy, effective January 1, 2026](https://www.sec.gov/Archives/edgar/data/1325814/000162828025050518/exhibit9912026directorfeep.htm)</u><sup>9</sup> |
| 10.7 | <u>[2025 Director Fee Policy, effective January 1, 2025](https://www.sec.gov/Archives/edgar/data/1325814/000132581424000223/exhibit1012025directorfeep.htm)</u><sup>10</sup> |
| 10.8 | <u>[Federal Home Loan Bank of Des Moines Deferral Plan for Directors, effective June 1, 2015](https://www.sec.gov/Archives/edgar/data/1325814/000132581416000274/exhibit1018fhlbdirectordef.htm)</u><sup>11</sup> |
| 10.9 | <u>[Federal Home Loan Bank of Des Moines Executive Severance Plan, effective May 1, 2023](https://www.sec.gov/Archives/edgar/data/1325814/000132581423000100/executiveseverance2023fi.htm)</u><sup>12</sup> |
| 10.10 | <u>[Federal Home Loan Bank of Des Moines First Amendment to the Seventh Amended and Restated Benefit Equalization Plan, effective December 31, 2024](https://www.sec.gov/ix?doc=/Archives/edgar/data/0001325814/000132581425000016/fhlbdm-20250122.htm)</u><sup>13</sup> |
| 19.1 | <u>[Federal Home Loan Bank of Des Moines Disclosure and Insider Trading Policy](exhibit1912026disclosure.htm)</u> |
| 31.1 | <u>[Certification of the President and Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](q425exhibit311ceo302.htm)</u> |
| 31.2 | <u>[Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](q425exhibit312cfo302.htm)</u> |
| 32.1 | <u>[Certification of the President and Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](q425exhibit321ceo906.htm)</u> |
| 32.2 | <u>[Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](q425exhibit322cfo906.htm)</u> |
| 99.1 | <u>[Federal Home Loan Bank of Des Moines Audit Committee Report](exhibit991-auditcommitteer.htm)</u> |
| 101.INS | XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document. |
| 101.SCH | XBRL Taxonomy Extension Schema Document |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
| 104 | Cover Page Interactive Data File - The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |

---

1&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K filed with the SEC on June 1, 2015 (Commission File No. 000-51999).

2&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 10-K filed with the SEC on March 7, 2025 (Commission File No. 000-51999).

3&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 10-K filed with the SEC on March 7, 2024 (Commission File No. 000-51999).

4&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K/A (Amendment No. 1) filed with the SEC on August 3, 2020 (Commission File No. 000-51999).

5&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 10-K filed with the SEC on March 9, 2022 (Commission File No. 000-51999).

6&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K filed with the SEC on August 5, 2011 (Commission File No. 000-51999).

7&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 10-K filed with the SEC on March 10, 2021 (Commission File No. 000-51999).

8 &nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K/A (Amendment No. 1) filed with the SEC on May 16, 2025 (Commission File No. 000-51999).

9&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K filed with the SEC on November 7, 2025 (Commission File No. 000-51999).

10&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K/A (Amendment No. 1) filed with the SEC on December 16, 2024 (Commission File No. 000-51999).

11&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 10-K filed with the SEC on March 21, 2016 (Commission File No. 000-51999).

12&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K filed with the SEC on May 22, 2023 (Commission File No. 000-51999).

13&nbsp;&nbsp;&nbsp;&nbsp;Incorporated by reference from our Form 8-K filed with the SEC on January 28, 2025 (Commission File No. 000-51999).

**<u>ITEM 16. FORM 10-K SUMMARY</u>**

Not applicable.

**Glossary of Terms**

---

| |
|:---|
| **2024 Form 10-K**: The Bank's 2024 Annual Report on Form 10-K filed with the SEC on March 7, 2025 |
| **AB**: Advisory Bulletin |
| **AFS**: Available-for-Sale |
| **AHP:** Affordable Housing Program |
| **AOCI**: Accumulated Other Comprehensive Income (Loss) |
| **AROCS**: Adjusted Return on Capital Stock |
| **ASU**: Accounting Standards Update |
| **BA**: Bachelor of Arts |
| **BEP**: Benefit Equalization Plan |
| **CAE**: Chief Audit Executive |
| **Capital Stock AB**: Finance Agency Advisory Bulletin on Capital Stock 2019-03 |
| **CBO**: Chief Business Officer |
| **CDFI**: Community Development Financial Institution |
| **CEO**: Chief Executive Officer |
| **CFA**: Chartered Financial Analyst |
| **CFI**: Community Financial Institution |
| **CFO**: Chief Financial Officer |
| **CFTC**: Commodity Futures Trading Commission |
| **Chicago Bank**: Federal Home Loan Bank of Chicago |
| **CHRO**: Chief Human Resources Officer  |
| **CIOO**: Chief Information and Operations Officer |
| **CLCO**: Chief Legal and Compliance Officer |
| **Code**: Code of Ethics |
| **CODM**: Chief Operating Decision Maker |
| **Compensation Committee**: Human Resources and Compensation Committee |
| **Comptroller General**: Comptroller General of the United States |
| **COO**: Chief Operating Officer |
| **CPA:** Certified Public Accountant |
| **CRO**: Chief Risk Officer |
| **DC Plan**: Federal Home Loan Bank of Des Moines 401(k) Savings Plan  |
| **EIP**: Executive Incentive Plan |
| **Exchange Act**: Securities Exchange Act of 1934, as amended |
| **Fannie Mae**: Federal National Mortgage Association |
| **FASB**: Financial Accounting Standards Board |
| **FDIC**: Federal Deposit Insurance Corporation |
| **FHA**: Federal Housing Administration |
| **FHLBank Act**: Federal Home Loan Bank Act of 1932 |
| **FHLBanks**: The 11 Federal Home Loan Banks or a subset thereof |

---

------

---

| |
|:---|
| **Finance Agency**: Federal Housing Finance Agency |
| **FLA**: First Loss Account |
| **FOMC**: Federal Open Markets Committee |
| **Freddie Mac**: Federal Home Loan Mortgage Corporation |
| **GAAP**: Generally Accepted Accounting Principles |
| **Ginnie Mae:** Government National Mortgage Association |
| **GSE**: Government-Sponsored Enterprise |
| **Housing Act**: Housing and Economic Recovery Act of 2008 |
| **HTM**: Held-to-Maturity |
| **IT**: Information Technology |
| **JCE Agreement**: Joint Capital Enhancement Agreement |
| **LCH**: London Clearing House |
| **Liquidity Guidance AB**: Finance Agency Advisory Bulletin on FHLBank Liquidity 2018-07 |
| **MA**: Master of Arts |
| **MBA**: Master of Business Administration |
| **MBS**: Mortgage-Backed Securities |
| **MD&A**: Management's Discussion and Analysis |
| **Moody's**: Moody's Investors Service, Inc. |
| **MPF**: Mortgage Partnership Finance (a federally registered trademark of the Federal Home Loan Bank of Chicago) |
| **MPP**: Mortgage Purchase Program |
| **MRCS**: Mandatorily Redeemable Capital Stock |
| **MVCS**: Market Value of Capital Stock |
| **MVE**: Market Value of Equity |
| **NEO**: Named Executive Officer |
| **NQDC**: Nonqualified Defined Contribution Retirement Plan |
| **NRSRO**: Nationally Recognized Statistical Rating Organization |
| **NYSE**: New York Stock Exchange |
| **OIS**: Overnight Index Swap |
| **OMWI**: Office of Minority and Women Inclusion  |
| **PCAOB**: Public Company Accounting Oversight Board |
| **PFI:** Participating Financial Institution |
| **Pittsburgh Bank**: Federal Home Loan Bank of Pittsburgh |
| **PMI**: Primary Mortgage Insurance |
| **PTO**: Paid Time Off |
| **PwC**: PricewaterhouseCoopers LLP |
| **ROE**: Return on Equity |
| **S&P**: S&P Global Ratings |
| **SBP**: Strategic Business Plan |
| **Seattle Bank**: Federal Home Loan Bank of Seattle |
| **SEC**: Securities and Exchange Commission |
| **SERP**: Supplemental Executive Retirement Plan |
| **SOFR**: Secured Overnight Financing Rate |
| **TBA**: To-Be-Announced |

---

------

---

| |
|:---|
| **Topeka Bank**: Federal Home Loan Bank of Topeka |
| **TVA**: Tennessee Valley Authority |

---

------

**<u>SIGNATURES</u>**

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
| | **FEDERAL HOME LOAN BANK OF DES MOINES**<br>*(Registrant)* | **FEDERAL HOME LOAN BANK OF DES MOINES**<br>*(Registrant)* |
| March 10, 2026 | By: | */s/ Kristina K. Williams* |
|  |  | Kristina K. Williams |
|  |  | President and Chief Executive Officer |

---

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.

March 10, 2026

---

| | |
|:---|:---|
| **Signature** | **Title** |
| *Principal Executive Officer:* | |
| */s/ Kristina K. Williams* | President and Chief Executive Officer |
| Kristina K. Williams | |
| *Principal Financial and Accounting Officer:* | |
| */s/ James G. Livingston* | Chief Financial Officer |
| James G. Livingston | |

---

------

---

| | |
|:---|:---|
| **Signature** | **Title** |
| *Directors:* | |
| */s/ Karl A. Bollingberg* | Chair of the Board of Directors |
| Karl A. Bollingberg | |
| */s/ John A. Klebba* | Vice Chair of the Board of Directors |
| John A. Klebba | |
| */s/ Ruth B. Bennett* | Director |
| Ruth B. Bennett | |
| */s/ Cleon P. Butterfield* | Director |
| Cleon P. Butterfield | |
| */s/ Kim R. DeVore* | Director |
| Kim R. DeVore | |
| */s/ Edward A. Garding* | Director |
| Edward A. Garding | |
| */s/ Amy K. Johnson* | Director |
| Amy K. Johnson | |
| */s/ Jon M. Jones* | Director |
| Jon M. Jones | |
| */s/ Joe R. Kesler* | Director |
| Joe R. Kesler | |
| */s/ Wan-Chong Kung* | Director |
| Wan-Chong Kung | |
| */s/ Russell J. Lau* | Director |
| Russell J. Lau | |

---

------

---

| | |
|:---|:---|
| **Signature** | **Title** |
| */s/ Lauren M. MacVay* | Director |
| Lauren M. MacVay | |
| */s/ Elsie M. Meeks* | Director |
| Elsie M. Meeks | |
| */s/ Peter J. Mehlhaff* | Director |
| Peter J. Mehlhaff | |
| */s/ Jason A. Meyerhoeffer* | Director |
| Jason A. Meyerhoeffer | |
| */s/ Siva G. Narendra* | Director |
| Siva G. Narendra | |
| */s/ Carol K. Nelson* | Director |
| Carol K. Nelson | |
| */s/ Matt C. Packard* | Director |
| Matt C. Packard | |
| */s/ Jeff L. Plagge* | Director |
| Jeff L. Plagge | |
| */s/ Lisa A. Stange* | Director |
| Lisa A. Stange | |
| */s/ Matt C. Stephenson* | Director |
| Matt C. Stephenson | |
| */s/ Robert J. Vogel* | Director |
| Robert J. Vogel | |

---

## Exhibit 19.1

![](exhibit1912026disclosure001.jpg)

Classification \| Internal Disclosure and Insider Trading Policy Effective Date: January 1, 2026

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![](exhibit1912026disclosure002.jpg)

Classification \| Internal 2 Effective Date January 1, 2026 Disclosure and Insider Trading Policy **TABLE OF CONTENTS** I. Purpose........................................................................................................... 3 A. Purpose Statement ............................................................................... 3 B. Overview ............................................................................................ 3 II. Key Definitions ................................................................................................. 4 III. Applicability ..................................................................................................... 5 IV. Disclosure Requirements ................................................................................... 6 A. General Prohibition ............................................................................... 6 B. Broad and Prompt Public Dissemination of Information .............................. 6 C. Authorized Spokespersons ..................................................................... 6 D. Means of Public Disclosure ..................................................................... 7 E. Consultation with Disclosure Coordinators ................................................ 7 F. Intentional or Unintentional Selective Disclosure ....................................... 8 G. Other Permitted Disclosures ................................................................... 9 V. Guidance on Specific Disclosure Situations ........................................................... 9 A. FHLBank System Group Discussions ........................................................ 9 B. Conference Calls and Meetings with Members ........................................... 9 C. Ordinary Course Communications ......................................................... 10 D. Directors ........................................................................................... 10 E. Responding to Rumors ........................................................................ 10 VI. Use of Material NonPublic Information ............................................................... 10 A. Restrictions on Trading ....................................................................... 10 B. Trading Blackout ................................................................................ 13 VII. Certifications and Bank Assistance .................................................................... 14 VIII. Penalties and Consequences ............................................................................. 14 A. Disclosure Violations ........................................................................... 14 B. Insider Trading Violations .................................................................... 14

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![](exhibit1912026disclosure003.jpg)

Classification \| Internal 3 Effective Date January 1, 2026 Disclosure and Insider Trading Policy I. PURPOSE A. Purpose Statement The purpose of this policy is to require all material disclosures to be made on a broadly disseminated basis and to provide guidance to all directors, officers, employees, and contractors (as defined in the Code of Ethics and collectively referred to as "employees and directors" within this policy) to help ensure that the Federal Home Loan Bank of Des Moines ("Bank") provides full disclosure and complies with legal and regulatory requirements that regulate how such disclosure is communicated, including the Securities and Exchange Commission's ("SEC") Regulation FD and the rules, regulations, and laws governing the FHLBanks. Further, this policy has been adopted to prevent the misuse of material nonpublic information (i.e., any use of that information for other than the Bank's necessary purposes) by employees and directors as that may violate federal and state banking and/or securities laws and other legal and regulatory requirements. The Bank has adopted this policy to avoid even the appearance of improper conduct on the part of anyone employed by or associated with the Bank. B. Overview The Bank is committed to providing full, fair, accurate and timely information to its members, investors in consolidated obligations ("COs") of the Federal Home Loan Bank ("FHLBank") System and the public, in accordance with legal and regulatory requirements, including applicable requirements under the rules and regulations of the SEC and the Federal Housing Finance Agency ("Finance Agency"). While performing their duties, employees and directors may learn material nonpublic information about the Bank, the FHLBank System, the Bank's member institutions, counterparties, vendors or another company. Employees and directors must maintain the confidentiality of such information, except when disclosure of such information is authorized by the Bank or legally required. Regulation FD1 prohibits the selective disclosure of material nonpublic information to (i) certain securities professionals and (ii) any security holder (including any member institution) where it is reasonably foreseeable that the security holder will trade on the information, prior to the broad public dissemination of the information. The restrictions in Regulation FD do not apply to disclosures made to (i) a person who owes a duty of trust or confidence to the Bank or (ii) a person who expressly agrees to maintain the disclosed information in confidence. This policy should be read in conjunction with the Bank's Code of Ethics. 1 17 CFR Part 243

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![](exhibit1912026disclosure004.jpg)

Classification \| Internal 4 Effective Date January 1, 2026 Disclosure and Insider Trading Policy II. KEY DEFINITIONS Regulation FD – SEC regulation that requires public companies to disclose material non-public information that has been shared with private individuals, in an effort to ensure all investors have equal and timely access to a company's material disclosures. Material Information - Under the federal securities laws, information is generally regarded as "material" if there is a substantial likelihood that a reasonable investor would consider the information important in deciding whether to purchase, sell, or hold a security, or if the information would significantly alter the total mix of publicly available information considered by the reasonable investor in making an investment decision.2 Material information can be positive or negative and can relate to virtually any aspect of an entity's business or to any type of security, debt or equity. For example, significant information concerning the following events should be presumed to be "material": • Dividend announcements; • Revisions to policies or procedures relating to dividends, retained earnings, stock redemptions or stock repurchases; • Earnings information and quarterly results; • Earnings guidance; • Adjustments in credit standing or risk profile; • Events regarding securities (e.g., issuances of new securities, defaults on securities or changes to the rights of security holders); • The launch of a major new product or business; • The discontinuation of a significant product or business; • Significant changes in operations; • Acquisitions, mergers, joint ventures, divestitures, changes in assets or similar transactions; • Extraordinary borrowings; • Gain or loss of a significant member, customer, counterparty, or supplier; • Entry into or termination of a significant contract; • Changes in senior management or the board of directors; • Changes in compensation policies; • Changes in previously disclosed financial information; • A determination that previously issued financial statements may not be relied upon because of an error in such financial statements; • Changes in auditors or auditor notification that the Bank may no longer rely on an audit report; • Significant legal disputes, including government investigations; • Significant regulatory actions or developments; • Impending financial liquidity problems; • Corporate reorganization, liquidation, or similar transactions or events; and 2 17 CFR §230.405

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![](exhibit1912026disclosure005.jpg)

Classification \| Internal 5 Effective Date January 1, 2026 Disclosure and Insider Trading Policy • Events relating to other FHLBanks, the Office of Finance or the FHLBank System significantly affecting the Bank or CO investors. The above list is only illustrative; many other types of information may be considered "material" depending on the circumstances. Nonpublic Information - Information is "nonpublic" if it is not available to the general public. In order for information to be considered public, it must be broadly disseminated or made widely available to the general public, such as by filing a Form 8-K, by distributing a press release through a widely disseminated news or wire service or by any other non-exclusionary method of disclosure that is reasonably designed to provide broad public access – such as an announcement at a conference of which the public had notice and to which the public was granted access, either by personal attendance or telephonic or electronic access. In addition, even after a public announcement of material information, a reasonable period of time must elapse in order for the market to react to the information. For purposes of this policy, employees and directors shall treat all material information as "nonpublic" unless and until two business days have elapsed since the public announcement of such information. When in doubt, the information involved should be presumed to be both material and not to have been disclosed to the public. Disclosure Coordinators - Chief Legal and Compliance Officer (CLCO), Chief Business Officer, Controller, or Financial Reporting and Analysis Director III. APPLICABILITY This policy applies to all employees and directors of the Bank. It covers all disclosure of material information about the Bank or its securities, which may include but is not limited to: documents filed with or furnished to the SEC; annual and quarterly reports; news and earnings releases; communications to or interactions with members, CO investors, the news media and the public; speeches and presentations; and information contained on the Bank's website and in webcasts. The policy also applies to material nonpublic information about the Bank, including information regarding the capital stock of the Bank, COs issued by the FHLBank System and any other securities that may be issued by the Bank or FHLBank System, which came to such employee or director through his or her relationship with the Bank. In addition, the policy applies to material nonpublic information relating to any member institution, counterparty, vendor, or other company, if such information came to such employee or director through his or her relationship with the Bank.

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![](exhibit1912026disclosure006.jpg)

Classification \| Internal 6 Effective Date January 1, 2026 Disclosure and Insider Trading Policy IV. DISCLOSURE REQUIREMENTS A. General Prohibition Except as permitted by this policy: 1. Employees and directors of the Bank may not disclose material nonpublic information regarding the Bank to anyone who is not an employee or director of the Bank. 2. Employees and directors of the Bank may not disclose material nonpublic information regarding any member or former member of the Bank, any other FHLBank, the FHLBank System, any counterparty or vendor of the Bank, or any other company to anyone who is not an employee or director of the Bank if such information was obtained in his or her capacity as an employee or director of the Bank. 3. Employees and directors of the Bank shall not disclose confidential information received by them solely by reason of their position with the Bank in an attempt to obtain a financial benefit for themselves or for any other person. B. Broad and Prompt Public Dissemination of Information Broad and prompt public dissemination of material nonpublic information by the Bank reduces the risk of disclosure violations and helps support safety and soundness, good corporate governance, and accountability. Accordingly, unless circumstances warrant, it is the Bank's policy to broadly and promptly disseminate material nonpublic information about the Bank to regulators, members, other investors, and other participants in the FHLBank System. Circumstances that may warrant a delay in the public dissemination of information, include, but are not limited to, sensitive personnel, legal or similar matters, or situations when the Bank is evaluating the materiality of nonpublic information and the timing and method of its disclosure. C. Authorized Spokespersons To help ensure compliance with this policy, the Bank has designated spokespersons that are authorized to speak on behalf of the Bank. The Bank's authorized spokespersons are as follows: • Chair of the Board of Directors; • President and CEO; • Chief Business Officer; • Chief Financial Officer. Other employees or directors of the Bank may be designated by one of the above- named persons from time to time to speak on behalf of the Bank or to respond to specific inquiries. Any disclosures by an authorized spokesperson or their designees must be made in accordance with Regulation FD and this policy.

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![](exhibit1912026disclosure007.jpg)

Classification \| Internal 7 Effective Date January 1, 2026 Disclosure and Insider Trading Policy Authorized spokespersons must coordinate the disclosure with the Bank's Disclosure Committee or an authorized Disclosure Coordinator in advance of planned conversations or presentations involving securities professionals, members or other security holders in order to review as much of the substance of the intended communication as possible. If possible, the Bank's CLCO should be in attendance during such conversations or presentations. Employees and directors, other than those authorized to speak on behalf of the Bank, are instructed not to attempt to respond, under any circumstances, to inquiries from investors, members or the media regarding material nonpublic information. Instead, they must direct calls with these types of inquiries immediately to the Bank's Legal Department or External Communications Department, who will consult with a Disclosure Coordinator before responding. D. Means of Public Disclosure The prompt and robust disclosure of information by the Bank reduces the risk of improper disclosure, insider trading, and similar violations. Every employee and director of the Bank is responsible for doing his or her part to ensure that information included in reports and documents filed with regulators and in other public communications from the Bank is full, fair, accurate, timely, and understandable. The Bank shall endeavor to disclose material information as promptly as possible via a means reasonably designed to provide broad, non- exclusionary distribution to the public, including one or more of the following: 1. News Releases The Bank will distribute any news release containing information that otherwise constitutes material nonpublic information on a widely circulated wire service, post it on the Bank's website, and, when applicable, file it with or furnish it to the SEC and the Finance Agency. 2. SEC Filings The Bank will disseminate material information through appropriate SEC filings (Forms 10-K, 10-Q, and 8-K on EDGAR) in accordance with the rules and regulations of the SEC and the Finance Agency. E. Consultation with Disclosure Coordinators Employees and directors of the Bank may have individual or group meetings, discussions and conversations with representatives of members, CO investors, analysts, and other external audiences. Unless otherwise expressly permitted by this policy, information provided in these meetings, discussions and conversations will be limited to already publicly disclosed financial and other information, or information that is otherwise deemed immaterial.

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![](exhibit1912026disclosure008.jpg)

Classification \| Internal 8 Effective Date January 1, 2026 Disclosure and Insider Trading Policy If an employee or director believes that it will be or may be necessary or appropriate in accordance with his or her duties to the Bank to disclose material nonpublic information in connection with any meeting, discussion or conversation including any external audience, the employee or director must consult with one of the Bank's Disclosure Coordinators in advance. The Disclosure Coordinators will assist the employee or director in (i) determining the materiality of the information; (ii) determining whether the anticipated or intended disclosure is necessary or appropriate in accordance with his or her duties to the Bank; and (iii) establishing whether, and if so how, the anticipated or intended disclosure may be made in accordance with applicable legal and regulatory requirements. For example, in certain cases material nonpublic information may be selectively disclosed in accordance with applicable legal and regulatory requirements if the disclosure is made to a person who owes a duty of trust or confidence to the Bank (such as an attorney, investment banker or accountant) or to a person who expressly agrees to maintain the disclosed information in confidence. If the Bank's Disclosure Coordinators determine that the employee or director may make the anticipated or intended disclosure in accordance with applicable legal and regulatory requirements, the employee or director may make the disclosure, subject to any conditions that the Bank's Disclosure Coordinators have determined must be met in order for the disclosure to comply with applicable legal and regulatory requirements. Employees or directors may only make selective disclosure of material nonpublic information as determined by the Bank's Disclosure Coordinators. As necessary, the Disclosure Coordinators may consult with the Disclosure Committee for assistance in carrying out their responsibilities. F. Intentional or Unintentional Selective Disclosure Employees or directors who disclose material nonpublic information in violation of this policy must immediately inform one of the Bank's Disclosure Coordinators of the disclosure. Employees or directors that become aware that anyone else has disclosed material nonpublic information under these circumstances must also immediately inform one of the Bank's Disclosure Coordinators. If required under applicable federal securities laws, the Bank will promptly (but in no event after the later of 24 hours or the commencement of the next day's trading of COs) disclose the information in a broad, non-exclusionary manner, such as in a press release or a Form 8-K furnished to the SEC.3 3 17 CFR §243.100

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![](exhibit1912026disclosure009.jpg)

Classification \| Internal 9 Effective Date January 1, 2026 Disclosure and Insider Trading Policy G. Other Permitted Disclosures The limitations in this policy do not apply to disclosures made by employees or directors to the Finance Agency or the SEC; other governmental agencies or regulators as to matters within their jurisdiction; the Office of Finance; credit rating agencies; or any independent legal, auditing, accounting firm, or other FHLBanks subject to appropriate confidentiality obligations to the Bank, as determined by the Bank's Disclosure Committee or its authorized designee(s). In certain cases, the limitations in this policy may not apply to disclosures made by employees or directors to consultants, agents, and other business partners of the Bank who are subject to written confidentiality agreements to the Bank. Employees and directors must consult with one of the Bank's Disclosure Coordinators prior to disclosing material nonpublic information to consultants, agents or business partners of the Bank. V. GUIDANCE ON SPECIFIC DISCLOSURE SITUATIONS A. FHLBank System Group Discussions FHLBank System groups (e.g., the Council of FHLBanks, the FHLBank Presidents' Committee, the FHLBank Chief Financial Officers' Committee, and the FHLBank Controllers' Committee) and their respective participants hold individual or group meetings and discussions that may involve material nonpublic information about one or more FHLBanks or the FHLBank System, including discussions relating to financial performance or joint and several liability for COs. Meetings and discussions held under these circumstances by employees or directors are not prohibited by this policy, provided that any disclosure of material nonpublic information is:  made to a person owing a duty of trust or confidence to the Bank;  made to a person who expressly agrees to maintain the disclosed information in confidence; or  not made to a holder of the Bank's securities under circumstances in which it is reasonably foreseeable that the person will purchase or sell the Bank's securities on the basis of the disclosed information. B. Conference Calls and Meetings with Members From time to time, the Bank may hold conference calls and meetings with members to provide information about the Bank. The Bank will not intentionally disclose material nonpublic information selectively in these meetings. In accordance with this policy, the Bank will disclose pertinent material nonpublic information prior to such meetings.

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![](exhibit1912026disclosure010.jpg)

Classification \| Internal 10 Effective Date January 1, 2026 Disclosure and Insider Trading Policy C. Ordinary Course Communications Because of the Bank's unique structure as a cooperative, a number of the Bank's employees regularly communicate with the Bank's security holders regarding ordinary course Bank business. These employees may not disclose material nonpublic information, and these employees must keep themselves apprised of the Bank's public disclosures so that they do not inadvertently disclose material nonpublic information in violation of this policy. D. Directors Although the Bank's directors are not authorized to speak on behalf of the Bank other than as expressly provided in this policy, such directors may communicate with persons outside the Bank as long as the communications do not include material nonpublic information. E. Responding to Rumors Generally, the Bank will not comment on rumors or speculation. All inquiries regarding rumors or speculation must be referred to one of the Bank's authorized spokespersons for appropriate action. VI. USE OF MATERIAL NONPUBLIC INFORMATION A. Restrictions on Trading When in the possession of material nonpublic information about an issuer of securities (including the Bank, the FHLBank System or any member institution, counterparty, vendor or other company), which information came to such employee or director through his or her relationship with the Bank, such employee or director is not permitted to (1) engage in any transaction in the securities of such issuer (including both Bank capital stock and COs, and if the information relates to a member institution, counterparty, vendor, or other company, the securities of such member institution, counterparty, vendor, or other company or any parent holding company thereof), or (2) except as required by law or permitted under this policy, disclose such information to anyone except Bank directors, personnel and representatives (such as accountants, attorneys and agents), and others subject to appropriate confidentiality obligations to the Bank having a need to know the information for legitimate Bank-related reasons.4 4 17 CFR §240.10b5-1(a)

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![](exhibit1912026disclosure011.jpg)

Classification \| Internal 11 Effective Date January 1, 2026 Disclosure and Insider Trading Policy 1. "Tipping" of Information to Others An employee or director who improperly reveals material nonpublic information to another person can be held liable for the trading activities of his or her "tippee" and any other person with whom the tippee shares the information. The penalties (discussed in Section VIII) apply whether or not an insider benefits financially from such trades and whether or not an insider knew or intended that another person would trade in the relevant security on the basis of the information revealed. An employee or director is not permitted to disclose material nonpublic information concerning an issuer of securities, which information was obtained through such employee or director's relationship with the Bank, to another person who may subsequently use that information to his or her profit. To reduce the chances of inadvertent tipping of material nonpublic information, except as required by law, no such information is to be disclosed to anyone except Bank directors, personnel and representatives (such as accountants, attorneys and agents) who have a valid business reason for receiving such information (i.e., who have a "need to know" the information in order to serve the business purposes of the Bank). Such information will be regarded as particularly sensitive, confidential information. a. Transactions by Family Members - To the extent set forth in this paragraph, the restrictions in this policy apply to an employee's or director's family members and others living in his or her household. Except as required by law or as otherwise permitted pursuant to this policy, employees and directors are not permitted to disclose to anyone outside of the Bank, including family or household members of the employee or director, material nonpublic information about an issuer of securities, which information came to such employee or director through his or her relationship with the Bank. Notwithstanding the foregoing, if an employee's or director's family or household member comes into possession of material nonpublic information about an issuer of securities, which information came to such individual through the employee's or director's relationship with the Bank, such family or household member is not permitted to (1) engage in any transaction in the securities of such issuer (including both Bank capital stock and COs, and if the information relates to a member institution, counterparty, vendor, or other company, the securities of such member institution, counterparty, vendor, or other company or any parent holding company thereof), or (2) except as required by law, disclose such information to anyone. Employees and directors are expected to be responsible for the compliance of their family members and others in their household with this restriction.

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![](exhibit1912026disclosure012.jpg)

Classification \| Internal 12 Effective Date January 1, 2026 Disclosure and Insider Trading Policy b. Transactions by a Director's Institution - To the extent set forth in this paragraph, the restrictions in this policy apply to the member institution(s) or other entities where a director serves as an officer or employee. Directors are not permitted to use in connection with their activities at their institution(s) or entities, or to disclose to any individuals at their institution(s) or entities, material nonpublic information about an issuer of securities, which information came to such director through his or her relationship with the Bank. Notwithstanding the foregoing, if a director's institution or entity comes into possession of material nonpublic information about an issuer of securities, which information came to such institution or entity through the director's relationship with the Bank, such institution or entity is not permitted to (1) engage in any transaction in the securities of such issuer (including both Bank capital stock and COs, and if the information relates to a member institution, counterparty, vendor or other company, the securities of such member institution, counterparty, vendor or other company or any parent holding company thereof), or (2) except as required by law, disclose such information to anyone. c. Inadvertent "Tipping" – Employees and directors must take care that material nonpublic information is secure. For example, files containing such information should be sealed and access to computer files containing such information should be restricted. In addition, employees and directors should not discuss such information in public places where it can be overheard, such as elevators, restaurants, taxis, and airplanes. No employee or director is permitted to give trading advice of any kind about the securities of an issuer to anyone while possessing material nonpublic information about such issuer, which information came to such employee or director through his or her relationship with the Bank, except to advise others not to trade if doing so might violate the law or this policy. The Bank strongly discourages all employees and directors from giving trading advice concerning the securities of the Bank or the FHLBank System to third parties even when such employee or director does not possess material nonpublic information about the Bank or the FHLBank System. 2. Trading in Securities of Members The penalties for insider trading (discussed in Section IX) apply equally to material nonpublic information concerning member institutions. The Bank may from time to time be in possession of material nonpublic information related to its member institutions. Member employees and directors are prohibited from trading in the securities of a member institution while in possession of material nonpublic information concerning such member obtained through such employee's or director's relationship with the Bank. Except as required by law or as permitted under this policy, employees and directors are prohibited from disclosing such information to anyone except Bank directors, personnel and

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![](exhibit1912026disclosure013.jpg)

Classification \| Internal 13 Effective Date January 1, 2026 Disclosure and Insider Trading Policy representatives (such as accountants, attorneys, and agents) having a need to know the information for legitimate Bank-related reasons. 3. Trading in Securities of Vendors, Counterparties, and Other Companies The penalties for insider trading (discussed in Section IX) apply equally to material nonpublic information concerning vendors, counterparties and other companies. Employees and directors are prohibited from trading in the securities of another company while in possession of material nonpublic information concerning such other company obtained by the employee or director through his or her relationship with the Bank. Except as required by law, employees and directors are prohibited from disclosing such information to anyone except Bank directors, personnel and representatives (such as accountants, attorneys, and agents) having a need to know the information for legitimate Bank-related reasons. 4. Twenty-Twenty Hindsight If securities transactions become the subject of scrutiny, they are likely to be viewed after-the-fact with the benefit of hindsight. As a result, before engaging in any transaction, an employee or director must carefully consider how regulators and others might view the transaction in hindsight. B. Trading Blackout In order to avoid even the appearance of improper trading, at the discretion of management, blackout periods may be established from time to time when material nonpublic information is shared with the Board of Directors. Such blackout periods will stay in effect until two business days have elapsed since the date that information is made public. During such blackout periods, and with respect to a member institution where a member director of the Bank serves as a director or employee (i.e., a director institution), the Bank will not:  redeem or otherwise repurchase any shares of the Bank's capital stock from the director institution, other than pursuant to an automatic sweep of excess stock;  approve any transfers of capital stock by a director institution to another member or prospective member; or  allow a director institution to pay down advances prior to maturity, unless approved by the Board of Directors. The Bank will notify a designated individual at each director institution regarding the establishment of any blackout period. The existence of a blackout will not be announced publicly, and any person made aware of the existence of a blackout must not disclose the existence of the blackout to any other person.

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![](exhibit1912026disclosure014.jpg)

Classification \| Internal 14 Effective Date January 1, 2026 Disclosure and Insider Trading Policy At the discretion of management and depending on the level of materiality of any material nonpublic information, any blackout period may be extended to prohibit the purchase or sale of COs by any employee or director of the Bank or by any director institution. VII. CERTIFICATIONS AND BANK ASSISTANCE Each of the Bank's employees and directors are expected to understand and comply with this policy. By annually signing the Bank's Code of Ethics certification, each of the Bank's employees and directors certifies that he or she has complied with and will continue to comply with this policy. This policy only briefly summarizes the key provisions of some of the laws affecting the Bank's employees and directors and does not purport to be a complete summary of all laws, including state laws and foreign laws, relating to the use of material nonpublic information. Any person who has any questions about specific transactions or general questions about this policy may obtain additional guidance from the Bank's Legal Department. VIII. PENALTIES AND CONSEQUENCES Bank management or the Board will address violations of this policy as appropriate. If required by law or otherwise appropriate, violations will be reported to the Finance Agency or other appropriate authorities. A. Disclosure Violations Violations of Regulation FD are subject to SEC enforcement action with possible penalties including cease-and-desist orders and monetary penalties. In addition, any disclosure violation may be grounds for disciplinary action by the Bank, up to and including possible termination of service. All disclosure violations shall be reported to the Bank's Disclosure Committee. B. Insider Trading Violations An individual who uses or allows the use of information obtained as a result of his or her relationship with the Bank but which is not available to the general public in order to engage in any financial transaction or to further a private interest may be subject to prosecution and/or liability under federal and state banking and/or securities laws and other legal and regulatory provisions. The consequences of insider trading violations alone can be staggering:5 For individuals who trade on inside information (or disclose inside information to others who trade), penalties may include: • A bar on serving as a director or officer of a public company; • Disgorgement of any profit gained or loss avoided; 5 15 USC §78u-1

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![](exhibit1912026disclosure015.jpg)

Classification \| Internal 15 Effective Date January 1, 2026 Disclosure and Insider Trading Policy • A civil penalty (in addition to disgorgement) of up to three times the profit gained or loss avoided; • A criminal fine (no matter how small the profit) of up to $5 million; and • A jail term of up to 20 years. For the Bank's (as well as possibly any supervisory person) failure to take appropriate steps to prevent illegal insider trading, penalties may include: • A civil penalty of the greater of $1 million or three times the profit gained or loss avoided as a result of violation; and • A criminal penalty of up to $25 million. Any of the above consequences, or even an SEC investigation that does not ultimately result in prosecution, can tarnish one's reputation and irreparably damage a career.

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## Exhibit 31.1

**EXHIBIT 31.1**

**Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

**for the President and Chief Executive Officer**

&nbsp;&nbsp;&nbsp;&nbsp;I, Kristina K. Williams, certify that:

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| | |
|:---|:---|
| 1 | I have reviewed this annual report on Form 10-K of the Federal Home Loan Bank of Des Moines; |
| 2 | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3 | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4 | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have: |

---

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

---

| | |
|:---|:---|
| 5 | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |

---

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: March 10, 2026 | */s/ Kristina K. Williams* |
| | Kristina K. Williams |
| | President and Chief Executive Officer |

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## Exhibit 31.2

**EXHIBIT 31.2**

**Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

**for the Chief Financial Officer**

&nbsp;&nbsp;&nbsp;&nbsp;I, James G. Livingston, certify that:

1 I have reviewed this annual report on Form 10-K of the Federal Home Loan Bank of Des Moines;

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| | |
|:---|:---|
| 2 | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |

---

---

| | |
|:---|:---|
| 3 | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |

---

---

| | |
|:---|:---|
| 4 | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have: |

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a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

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| | |
|:---|:---|
| 5 | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |

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a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

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| | |
|:---|:---|
| Date: March 10, 2026 | */s/ James G. Livingston* |
| | James G. Livingston |
| | Chief Financial Officer |

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## Exhibit 32.1

**EXHIBIT 32.1**

**Certification by the President and Chief Executive Officer**

**Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** 

I, Kristina K. Williams, President and Chief Executive Officer of the Federal Home Loan Bank of Des Moines ("Registrant") certify that, to the best of my knowledge:

1 The Registrant's Annual Report on Form 10-K for the period ended December 31, 2025 ("Report"), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2 The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

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| | |
|:---|:---|
| Date: March 10, 2026 | */s/ Kristina K. Williams* |
| | Kristina K. Williams |
| | President and Chief Executive Officer |

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## Exhibit 32.2

**EXHIBIT 32.2**

**Certification by the Chief Financial Officer**

**Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** 

I, James G. Livingston, Chief Financial Officer of the Federal Home Loan Bank of Des Moines ("Registrant") certify that, to the best of my knowledge:

1 The Registrant's Annual Report on Form 10-K for the period ended December 31, 2025 ("Report"), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2 The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

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| | |
|:---|:---|
| Date: March 10, 2026 | */s/ James G. Livingston* |
| | James G. Livingston |
| | Chief Financial Officer |

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## Exhibit 99.1

**EXHIBIT 99.1**<br>

**Audit Committee Report**

March 10, 2026

The Audit Committee is composed of seven directors, four serving as independent directors, and three serving as member directors. The Committee operates under a written charter adopted by the Board of Directors that was last amended on February 10, 2026. Our Board of Directors determined that Cleon Butterfield, Edward Garding, Jon Jones, Russell Lau, and Elsie Meeks, members of the Audit Committee, are each considered an "Audit Committee financial expert" for purposes of SEC requirements. Our Board of Directors elected to use the New York Stock Exchange definition of "independence" and, in doing so, concluded that four of the Directors on the Audit Committee, during 2025 and three currently, are not independent as they are officers or directors of member institutions which do business with the Bank. Directors Bennett, Butterfield, Garding, and Meeks do not serve as officers or directors of a Bank member and are independent. Under Federal Housing Finance Agency (Finance Agency) regulations applicable to members of the Audit Committee, each of the Audit Committee members is independent. For further discussion about the Board's analysis of director independence under the New York Stock Exchange rules, see "Director Independence" in Item 13.

In accordance with its written charter adopted by the Board of Directors, the Audit Committee assists the Board of Directors in fulfilling its responsibility for oversight of the Bank's accounting, reporting, and financial practices, including the integrity of its financial statements, among other areas. The Audit Committee Charter is available in full on our website at www.fhlbdm.com.

The Audit Committee is directly responsible for the appointment and oversight of our independent auditors, PricewaterhouseCoopers LLP (PwC), including review of their qualifications, independence, and performance. Among other duties, the Audit Committee also oversees:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The integrity of the Bank's financial statements and financial reporting process and systems of internal accounting and financial reporting controls.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The independence, scope of audit services, and performance of the Bank's internal audit function as well as the appointment or replacement of the Chief Audit Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The selection and replacement, qualifications, independence, scope of audit, and performance of the Bank's external auditor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank's compliance with laws, regulations and policies, including the Code of Ethics.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The policy for complaints regarding questionable accounting, internal accounting controls, and auditing matters, and oversight of fraud investigations.

The Bank is one of 11 district Federal Home Loan Banks (FHLBanks), that together with the Office of Finance, comprise the Federal Home Loan Bank System (System). Each FHLBank operates as a separate entity with its own management, employees, and board of directors and each is regulated by the Finance Agency. The Office of Finance has responsibility for the issuance of consolidated obligations on behalf of the FHLBanks, and for publishing the System's combined financial reports (CFRs). Accordingly, the System has determined that it is optimal to have the same independent audit firm to coordinate and perform the separate audits of the Office of Finance and annual financial statements of each FHLBank and the Office of Finance's annual CFRs. The FHLBanks and Office of Finance collaborate in selecting, approving the compensation of, and evaluating the performance of the independent auditor, but the responsibility for the appointment of and oversight of the independent auditor remains solely with the audit committees of each FHLBank and the Office of Finance.

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PwC has been the independent auditor for the System and the Bank since 1990. The Audit Committee engages in evaluations of the independent auditor. In connection with the appointment of the Bank's independent auditor, the Audit Committee's evaluation included coordination with the audit committees of the other FHLBanks and the Office of Finance. Specific considerations included:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an analysis of the risks and benefits of retaining the same firm as independent auditor versus engaging a different firm, including consideration of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ PwC engagement audit partner, engagement quality review partner, and audit team rotation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ PwC's tenure as the Bank's and the System's independent auditor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ benefits associated with engaging a different firm as independent auditor; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ potential disruption and risks associated with changing the Bank's auditor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the firm's depth and breath of understanding of our business, operations, and accounting policies and practices;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• PwC's historical and recent performance on the Bank's audit, including the results of an internal survey of PwC service and quality;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an analysis of PwC's known legal risks and significant proceedings;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• external data relating to audit quality and performance, including recent Public Company Accounting Oversight Board (PCAOB) audit quality inspection reports on PwC and its peer firms as well as metrics indicative of audit quality;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the appropriateness of PwC's fees, on both an absolute basis and as compared to its peer firms; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the diversity of PwC's ownership and staff assigned to the engagement.

Audit fees represent fees for professional services provided in connection with the audit of the Bank's annual financial statements and internal control over financial reporting and reviews of the Bank's quarterly financial statements, regulatory filings, consents and other SEC matters. The Committee has reviewed and approved the fees paid to the independent auditor for audit, audit related, and other services, and believes that PwC is independent.

In accordance with SEC rules, audit partners are subject to rotation requirements to limit the number of consecutive years an individual partner may provide service to the Bank. For lead partners, the maximum number of consecutive years of service in that capacity is five years.

Based on its reviews discussed above, the Audit Committee recommended to the Board of Directors the appointment of PwC as the Bank's independent registered public accounting firm for 2025.

The Audit Committee annually reviews its written charter and practices, and has determined that its charter and practices are consistent with the applicable Finance Agency regulations and the provisions of the Sarbanes-Oxley Act of 2002.

Among other matters, the Audit Committee also:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reviewed the scope of and overall plans for the external and internal audit program;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• discussed with management and the independent auditor significant matters, including Critical Audit Matters, if any, arising during the audit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reviewed and approved the Audit Committee's oversight of external auditor policy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reviewed and approved, as needed, non-audit services performed by Big Four firms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• performed oversight that management establishes, implements, and maintains accounting policies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• discussed with management the use of any non-GAAP measures in the financial statements; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• established Audit Quality Indicators to be used in the assessment of independent auditor performance.

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The Audit Committee has established a policy for the receipt, retention, and treatment, on a confidential basis, of any complaints the Bank receives. The Bank encourages employees and third-party individuals and organizations to report concerns regarding questionable accounting, internal accounting controls, or auditing matters.

Management has the primary responsibility for the preparation and integrity of the Bank's financial statements, accounting and financial reporting principles, and internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. The Bank's independent auditor, PwC, is responsible for performing an independent audit of the Bank's financial statements and of the effectiveness of internal control over financial reporting in accordance with auditing standards promulgated by the PCAOB and the U.S. Government Accountability Office. The internal auditors are responsible for preparing an annual audit plan and conducting internal audits under the control of the Chief Audit Executive, who reports to the Audit Committee. The Audit Committee's responsibility is to monitor and oversee these processes. The Audit Committee met 13 times during 2025, and has regular executive sessions with both internal and independent auditors.

In this context, prior to their issuance, the Audit Committee reviewed and discussed the quarterly and annual earnings releases, financial statements (including the presentation of non-GAAP financial information) and disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations" (including significant accounting policies and estimates) with management, the Bank's internal auditors, and PwC. The Audit Committee discussed with PwC matters required to be discussed by applicable requirements of the PCAOB. The Audit Committee has also received the written disclosures and the letter from PwC required by the applicable requirements of the PCAOB regarding PwC's communications with the Audit Committee concerning independence, and has discussed with PwC its independence [Item 407(d)(3) of Reg. S-X]. The Audit Committee met with PwC and with the Bank's internal auditors, in each case, with and without other members of management present, to discuss the results of their respective examinations, the evaluations of the Bank's internal controls, and the overall quality and integrity of the Bank's financial reporting. Management represented to the Audit Committee that the Bank's financial statements were prepared in accordance with accounting principles generally accepted in the United States of America.

Based on the reviews and discussions with management, the internal auditors, and PwC, as well as the review of the representations of management and PwC's report, the Audit Committee recommended to the Board of Directors, and the Board of Directors has approved, to include the audited financial statements in the Bank's Annual Report on Form 10-K for the year ended December 31, 2025, for filing with the Securities and Exchange Commission.

As of the date of filing for this Annual Report on Form 10-K, the members of the Audit Committee are:

Jon M. Jones, Chair

Russell J. Lau, Vice Chair

Ruth B. Bennett

Cleon P. Butterfield

Edward A. Garding

Joe R. Kesler

Elsie M. Meeks

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