The Federal Housing Finance Agency’s regulatory crackdown on the Federal Home Loan Banks threatens the housing finance system at a time of high prices and limited supply, ICBA wrote in a new op-ed.
ICBA Op-ed: In American Banker (subscription required), ICBA President and CEO Rebeca Romero Rainey wrote that the FHLBs have a proud record of promoting access to the housing market and providing a backup source of liquidity for member banks. Unfortunately for local communities, these successes are at risk of being undermined by regulators, she wrote.
Regulatory Crackdown: For instance, community bankers have reported rising regulatory scrutiny of advances, with regulators directing them to the Federal Reserve’s discount window, Romero Rainey said. She called on the FHFA to ensure its FHLB review does not create additional requirements that restrict access to advances.
ICBA Advocacy: ICBA and state community banking organizations recently told the FHFA that its advisory bulletin regarding credit risk management expectations for member institutions lacked both clarity and statutory authority. In a comment letter earlier this year, ICBA reiterated its opposition to additional requirements on FHLB advances.
