By Aaron Kness and Alissa Ward, Iowa State Bank and Trust, Fairfield
This year marks the 90th anniversary of the Federal Home Loan Bank System. For nine decades the FHLBanks have worked to improve the lives of millions of Americans. The customers we serve at Iowa State Bank and Trust have witnessed that impact first-hand. Congratulations to the FHLBanks for reaching this milestone, we are proud to celebrate our partnership with you.
Even after 90 years, the FHLB Des Moines has retained its core values. They prioritize providing community-focused financial institutions like ours with affordable liquidity so we can serve families, farms and businesses in our communities. In rural Iowa, access to liquidity is critical — not only to Iowa State Bank and Trust, but the employers, farmers, school districts and nonprofits that rely on our employees’ expertise and the bank’s credit products. Iowa banks are often relied upon to help solve challenging problems which require a significant amount of capital (and a little courage).
Jefferson County Kids, Inc. — Cambridge Little Achievers Center
Like many places in Iowa, Fairfield is struggling to provide enough options for parents in need of quality child care. Current facilities are full, forcing parents to make a decision about working, staying home or driving a distance for care. This critical need was identified, and Iowa State Bank and Trust took the lead in financing the construction of a child care facility with space for 185 kids. Using an FHLB Des Moines Community Investment Advance, we were able to price the construction loan 2.25% below our stated rate, saving the facility about $45,000 in interest costs annually. In an environment where small businesses are battling inflation, rising costs and employee shortages, every dollar saved in interest has an impact on the families who will utilize the new facility.
We are thrilled to see new investment in our communities and acknowledge the importance of long-term relationships. Iowa State Bank and Trust’s partnership with Agri-Industrial Plastics is another great example of the power of partnerships in supporting rural communities. A Top 10 employer in Fairfield, Agri-Industrial Plastics, has been a community staple for over 40 years. Iowa State Bank and Trust provided a start-up loan to the company in 1978 and continues to support its amazing growth to this day. As financing needs arise due to factory expansions and machinery purchases, Iowa State Bank is able to utilize FHLB Des Moines’ Community Investment Advances to meet them. With over 200 employees, Agri-Industrial Plastics’ growth is vitally important to southeast Iowa’s economy. They are a true Iowa success story.
It would be nearly impossible for Iowa State Bank and Trust to support small businesses or nonprofit organizations without FHLB Des Moines. Deposit growth in southeast Iowa is not sufficient to support growing loan demand and the credit needs of our customers. In the last 10 years, we have grown our assets by 130% and loans by 150%, due in part to our access to FHLB Des Moines credit products.
Committed to the Communities We Serve
One thing we are very proud of at Iowa State Bank and Trust is our culture. We value community engagement by our entire team and have become local nonprofits’ first stop for volunteers, monetary donations and financial advice. Iowa State Bank and Trust and its employees are involved in nearly every aspect of the community. It’s not uncommon for a customer to stop one of us on the street and say “thank you” for helping them develop a business plan, financing their first home or supporting a charitable organization they care deeply about. We try to touch every part of our community and our employees guide our involvement. Our partnership with FHLB Des Moines allows us to remain incredibly active in our local markets so we can give back to our community in a variety of meaningful ways.
For nearly a century, FHLBanks have supported community banks like Iowa State Bank and Trust, allowing them to better serve their communities. FHLBanks are not frequently recognized, but are a critical element of the nation’s financial infrastructure. Their ability to remain viable in all economic cycles is imperative to our organization’s ability to take care of our community. We rely on FHLB Des Moines and our business model would be radically different if we didn’t have access to their products and services.
On behalf of Iowa State Bank and Trust, thank you and congratulations to FHLB Des Moines as they enter their next decade of reliable partnerships with banks like us.