“Working Together for Strength” July 19, 2011

What Will Happen on August 2?

The Crisis

New and existing home sales remain low.

Net Job Loss, October 2006 - September 2010 Non-farm Payroll Data (in thousands) 600 400 200 (200) (400) (600) (800) (1,000) 1/1/2005 4/1/2005 7/1/2005 10/1/2005 1/1/2006 4/1/2006 7/1/2006 10/1/2006 1/1/2007 4/1/2007 7/1/2007 10/1/2007 1/1/2008 4/1/2008 7/1/2008 10/1/2008 1/1/2009 4/1/2009 7/1/2009 10/1/2009 1/1/2010 4/1/2010 7/1/2010 June 2011: 18,000 non-farm net jobs added 9.2% unemployment rate Source: Bureau of Labor Statistics

The Survey of Professional Forecasters expects the unemployment rate to decline to 8.2% by mid-2012. Percent Source: Federal Reserve Bank of Philadelphia; 2011 Q2 SPF.

Survey of Professional Forecasters expects CPI inflation of 3 Survey of Professional Forecasters expects CPI inflation of 3.1% in 2011 and 2.2% in 2012. Percent (4-Quarter Percent Change) 6.3 4.6 4.0 3.1 2.2 1.5 1.2 Source: Federal Reserve Bank of Philadelphia; 2011 Q2 Survey of Professional Forecasters 7 7

Blue Chip Consensus Forecast: GDP and CPI relatively flat for 2012 Consensus Forecast-Quarterly 3Q 4Q 1Q 2Q 3Q 4Q Key Assumptions in % 2011 2011 2012 2012 2012 2012 Real GDP 3.1 3.2 2.9 3.0 3.2 3.2 Consumer Price Index 2.2 2.1 2.3 2.3 2.3 2.4 Unemployment 8.9 8.7 8.6 8.4 8.2 8.1

Survey of Professional Forecasters expects higher short-term rates after 2012 and higher long-term rates as well. Annual average interest rates projected by SPF: Year 3-month T-bill rate 10-year T-bond rate AAA Corp. Bond Yield 2010 (Actual) 0.14% 3.21% 4.94% 2011 0.17% 3.60% 5.25% 2012 1.09% 4.19% 5.69% 2013 2.30% 4.50% NA 2014 3.02% 5.08% Source: Federal Reserve Bank of Philadelphia; Survey of Professional Forecasters Q2 2011

Looking ahead, the outlook is for positive growth across the nation. 10

W.Va. And U.S. Economic Growth (8.6% at May 2011) Source: Dr. George Hammond, WVU 11

Bank Failures 2009 through 6/30/11 distributed by FHLBanks 2 1

Texas Ratio as of 3/31/11 (institutions open at 3/31/11) 6

Texas Ratio – WV (Includes all banks open in WV at 3/31/11)

WV Liquidity (cash & deposits/assets) - 2 4 6 8 10% 3/31/11 12/31/2010 12/31/2009 121/31/08 12/31/2007 WV Average Nation Avg.

FHLBank Pittsburgh – Resilient and Relevant Business model has worked for nearly 80 years in all business cycles Capacity to grow and shrink Nearly $80 billion in advances in 1Q08 Products and services adjusted to market needs 1,400 affordable housing units in WV through AHP

FHLBank Advances/Core Earnings Trend

FHLBank Key Metric Trends

Regulatory Reform For community banks, the remedy must be proportional to the problem FHLBanks are not untouched. Our decisions, programs and products are under the microscope “Do No Harm” – need to continue to carry out our mission and serve our members

Our Six Measures of Long-Term Success Reliable access to funding and liquidity Products and services that help your business succeed Programs and resources to help your communities thrive Presence and influence with policymakers making critical decisions Business practices and customer service that make dealing with the Bank not just good business, but a pleasure A reasonable and consistent market-based return on a safe investment

The Need for Partnership Our industry is in many ways at the center of the storm We have the resources to emerge from the storm stronger over the long-term There is great benefit in collaborating on issues of mutual interest Partnership has never been more important

Thank you for your support and guidance.