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A recent Federal Home Loan Bank of New York decision to impose new reporting requirements on member banks will restrict access to home loans, ICBA said.
Background: The FHLBank of New York told its member banks in a recent message that it will impose additional qualitative and quantitative information reporting requirements to align with the FHFA’s more restrictive approach to lending, which threatens to restrict access to home loans in local communities nationwide.
ICBA Statement: In a national news release, ICBA said the nation’s community banks have repeatedly warned the Federal Housing Finance Agency not to disrupt the FHLBank System as an important source of liquidity for community banks.
Key Source of Funding: “The FHLBank system has worked well for over 90 years, providing community banks with the liquidity needed to fund home mortgage lending and community development projects,” ICBA President and CEO Rebeca Romero Rainey said in the statement. “The FHFA should ensure it does not disrupt the FHLBanks’ ability to remain a healthy and reliable source of funding for its member-owners.”
Comments This Week: In a comment letter this week on the FHFA’s review of the FHLBank System, ICBA said the agency should not create additional requirements that restrict FHLBank advances to members in good standing and with eligible collateral, which will reduce the availability of mortgage credit and community development funding in local communities when it is needed most.
Previous Comments: Following the FHFA’s comprehensive report last fall on the FHLBanks, ICBA urged the agency to ensure any new policies affecting the system do not disrupt it as a source of liquidity for community banks. ICBA offers a high-level summary of the report outlining its views on the agency’s policy recommendations.