[Federal Register Volume 66, Number 21 (Wednesday, January 31, 2001)]
[Notices]
[Pages 8402-8403]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-2640]


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FEDERAL HOUSING FINANCE BOARD

[No. 2001-N-4]


Annual Adjustment of the Limit in Average Total Assets for 
Community Financial Institutions and Annual Adjustment of the Limits on 
Annual Compensation for Federal Home Loan Bank Directors

AGENCY: Federal Housing Finance Board.

ACTION: Notice.

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SUMMARY: Notice is hereby given that the Federal Housing Finance Board 
(Finance Board) has adjusted the limit in average total assets that 
defines a ``Community Financial Institution'' (CFI) based on the annual 
percentage increase in the Consumer Price Index for all urban consumers 
(CPI-U), as published by the Department of Labor (DOL), pursuant to the 
requirements of section 2(13)(B) of the Federal Home Loan Bank Act 
(Bank Act) and Sec. 900.1 of the Finance Board's regulations. Notice is 
hereby given that the Finance Board also has adjusted the limits on 
annual compensation for the Federal Home Loan Bank (Bank) directors, 
based on the CPI-U, as published by the DOL, pursuant to the 
requirements of section 7(i)(2)(B) of the Bank Act and Sec. 918.3(a)(1) 
of the Finance Board's regulations.

FOR FURTHER INFORMATION CONTACT: James L. Bothwell, Managing Director 
and Chief Economist, (202) 408-2821; Scott L. Smith, Acting Director, 
Office of Policy, Research and Analysis, (202) 408-2991; Julie Paller, 
Office of Policy, Research and Analysis, (202) 408-2842; or Kirsten L. 
Landeryou, Office of Policy, Research and Analysis, (202) 408-2552. 
Staff also can be reached by regular mail at the Federal Housing 
Finance Board, 1777 F Street, NW., Washington, DC 20006. A 
telecommunications device for deaf persons (TDD) is available at (202) 
408-2579.

SUPPLEMENTARY INFORMATION: The Bank Act (12 U.S.C. 1422(13)(B)), as 
amended by the Gramm Leach Bliley Act (GLB Act) (Pub. L. 106-102, 133 
Stat. 1338 (November 12, 1999)) and Sec. 900.1 of the Finance Board's 
regulations (12 CFR 900.1) require the Finance Board to adjust annually 
the limit in average total assets (CFI Asset Cap) set forth in section 
2(13)(A)(ii) of the Bank Act (12 U.S.C. 1422(13)(A)(ii)) and Sec. 900.1 
of the Finance Board's regulations that defines a CFI, based on the 
annual percentage increase, if any, in the CPI-U, as published by the 
Department of Labor (DOL).
    Section 7(i)(2)(B) of the Bank Act (12 U.S.C. 1427(i)(2)(B)), as 
amended by the GLB Act, and Sec. 918.3(a)(1) of the Finance Board's 
regulations (12 CFR 913.3(a)(1)), require the Finance Board, beginning 
January 1, 2001, to make a similar annual adjustment to the 
compensation limits set forth in section 7(i)(2)(A) of the Bank Act (12 
U.S.C. 1427(i)(2)(A)) and Sec. 918.3(a)(1) of the Finance Board's 
regulations, for members of the boards of directors of the Banks based 
on the annual percentage increase, if any, in the CPI-U, as published 
by the DOL.
    Pursuant to the Finance Board's regulations, for purposes of the 
CFI Asset Cap, the Finance Board is required to publish notice by 
Federal Register of the CPI-U-adjusted cap. For purposes of the Banks' 
board of directors annual compensation adjustments, the Finance Board 
is required to publish notice, by Federal Register, distribution of a 
memorandum, or otherwise, of the CPI-U-adjusted limits on annual 
compensation. The annual adjustment of the existing CFI Asset Cap and 
annual Bank director compensation limits, effective January 1 of a 
particular calendar year, reflects the percentage by which the CPI-U 
published for November of the preceding calendar year exceeds the CPI-U 
published for November of the year before the preceding calendar year 
(if at all). For example, the adjustment of the limits effective 
January 1, 2001 are based on the percentage increase in the CPI-U from 
November 1999 to November 2000.
    The Finance Board has determined that it is appropriate to use data 
from November rather than waiting for the December data to become 
available so that the Banks can be notified of the revised asset limit 
and compensation limits as close to the effective date as possible. 
Other Federal agencies do not rely on December data, which is published 
in mid-January, when calculating annual inflation adjustments and as a 
result are able to announce the adjustments prior to the effective date 
of January 1.
    The DOL encourages the use of CPI-U data that has not been 
seasonally adjusted in ``escalation agreements'' because seasonal 
factors are updated annually and seasonally adjusted data are subject 
to revision for up to five years following the original release; 
unadjusted data are not routinely subject to revision, and previously 
published unadjusted data are only corrected when significant 
calculation errors are discovered. Accordingly, the Finance Board is 
using data that had not been seasonally adjusted to calculate the new 
CFI Asset Cap and annul Bank director compensation limits.
    Based on the unadjusted November 2000 CPI-U data, in Finance Board 
Resolution No. 2000-51 (Dec. 29, 2000), the Finance Board adjusted the 
CFI Asset Cap for 2001 from $500 million to $517 million, beginning 
January 1, 2001.
    In the same Finance Board Resolution, and based on the unadjusted 
November 2000 CPI-U data, the Finance Board adjusted the annual 
compensation for the listed members of

[[Page 8403]]

the boards of directors of the Banks as follows, beginning January 1, 
2001: For a Chairperson--$25,850; for a Vice-Chairperson--$20,680; for 
any other member of a Bank's board of directors--$15,510.

    Dated: January 23, 2001.
James L. Bothwell,
Managing Director.
[FR Doc. 01-2640 Filed 1-30-01; 8:45 am]
BILLING CODE 6725-01-P