[United States Government Manual]
[May 31, 1996]
[Pages 536-539]
[From the U.S. Government Publishing Office, www.gpo.gov]
FEDERAL HOUSING FINANCE BOARD
1777 F Street NW., Washington, DC 20006
Phone, 202-408-2500
Board of Directors:
Chairman Bruce A. Morrison
Members: Lawrence U. Costiglio,
J. Timothy O'Neill,
(vacancy)
(Secretary of Housing and Urban Henry G. Cisneros
Development, ex officio)
Housing and Urban Development Nicolas P. Retsinas
Secretary's Designee to the
Board
Special Assistants to the Karen H. Crosby, Mindy
Chairman Turbov
Executive Assistant to the HUD James H. Gray
Secretary
Assistants to the Board Melissa L. Allen, Julie
Directors P. Fallon
Officials:
Managing Director Rita I. Fair
Inspector General Edward Kelley
General Counsel Paul J. Drolet
Director, Office of Supervision Mitchell Berns
Director, Office of Policy Thomas D. Sheehan,
Acting
Director, Office of Congressional Affairs Randall H. MacFarlane
Director, Office of Public Affairs Naomi P. Salus
Director, Office of Resource Management Barbara L. Fisher
Secretary to the Board Elaine L. Baker
[For the Federal Housing Finance Board statement of organization, see
the Code of Federal Regulations, Title 12, Part 900]
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The Federal Housing Finance Board is responsible for the administration
and enforcement of the Federal Home Loan Bank Act, as amended.
The Federal Housing Finance Board (Finance Board) was established on
August 9, 1989, by the Federal Home Loan Bank Act, as amended by the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989
(FIRREA) (12 U.S.C. 1421 et seq.), as an independent regulatory agency
in the executive branch. The Finance Board succeeded the Federal Home
Loan Bank Board for those functions transferred to it by FIRREA.
The Finance Board is governed by a five-member Board of Directors.
Four members are appointed by the President with the advice and consent
of the Senate for 7-year terms; one of the four is designated as
Chairman. The Secretary of the Department of Housing and Urban
Development is the fifth member and serves in an ex officio capacity.
The Finance Board supervises the 12 Federal Home Loan Banks created
in 1932 by the Federal Home Loan Bank
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Act and issues regulations and orders for carrying out the purposes of
the provisions of that act. Savings associations, commercial banks,
savings banks, credit unions, insurance companies, and other
institutions specified in section 4 of the act that make long-term home-
mortgage loans are eligible to become members of the Federal Home Loan
Bank. The Finance Board supervises the Federal Home Loan Banks and
ensures that they carry out their housing finance mission, remain
adequately capitalized and able to raise funds in the capital markets,
and operate in a safe and sound manner. The functions of the Finance
Board include:
--prescribing rules and conditions under which the Banks may lend to
members and eligible nonmembers;
--issuing policies governing the Bank System's financial management
and investment activities;
--maintaining Bank System financial and membership data bases and
preparing reports on a regular basis;
--overseeing the implementation of the community investment and
affordable housing programs;
--conducting a biennial review of each member's community support
performance;
--issuing consolidated Federal Home Loan Bank obligations which are
joint and several obligations of all Federal Home Loan Banks;
--annually examining each Federal Home Loan Bank;
--requiring an independent financial audit of each Bank, the Office
of Finance, the Financing Corporation, and the Bank System;
--appointing six directors to the board of directors of each Bank
and conducting the election of the remaining directors by the members;
and
--setting standards for the review and approval of applications for
Bank membership.
The Finance Board is not subject to the appropriation process. Its
funds are neither appropriated nor derived from Government funds, and
are not subject to apportionment. The expenses of the Finance Board are
paid by assessment against the regional Federal Home Loan Banks.
Regional Banks
The System includes 12 regional Federal Home Loan Banks that are mixed-
ownership Government corporations. A board of directors, six of whom are
appointed by the Finance Board, manages the Banks. The Finance Board
conducts the election of the remaining directors.
Capital and Sources of Funds The Banks' principal source of capital is
stock, which members are required by law to purchase upon joining the
Bank System, and which is redeemed upon a member's withdrawal from the
System. The Banks fund their lending activity through the issuance of
Bank System consolidated obligations, which are the joint and several
liability of all the Banks. Member deposits are an additional source of
funds. Bank System consolidated debt is issued by the Finance Board
through the Office of Finance, the Bank System's fiscal agent. The
Banks' consolidated obligations are neither obligations of, nor
guaranteed by, the United States.
Operations The Banks' primary activity is extending secured loans
(advances) to member institutions. Advances are generally collateralized
by whole first mortgage loans and mortgage-backed securities, as well as
other high-quality assets. In making advances, the Bank System serves as
a source of short- and long-term funds for institutions operating in the
mortgage markets as originators and holders of mortgage assets. Because
the Bank System does not set standards for the loans its members make,
members have the flexibility to develop responsive credit products and
underwriting standards. The Banks also enter into hedging transactions
as intermediaries with their members, which assists the members with
their asset-liability management.
Under the Affordable Housing Program (AHP), the Banks provide
subsidized advances or direct subsidies to Bank members engaged in
lending for long-term owner-occupied and
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affordable rental housing targeted to households with very low, low, or
moderate incomes. This competitive program is financed from a specified
percentage of each Bank's previous year's net income. The greater of
$100 million or 10 percent of the previous year's net income is
available for the program.
Under the Community Investment Program (CIP), each Bank provides
advances priced at the Bank's cost of consolidated obligations of
comparable maturities plus reasonable administrative costs, to members
engaged in community-oriented mortgage lending. Advances are used for
loans to finance rental and owner-occupied housing for families whose
incomes do not exceed 115 percent of area median income and commercial
and economic development activities that benefit low- and moderate-
income families or that are located in low- and moderate-income
neighborhoods.
To maintain access to long-term advances, Bank members must
establish reasonable commitments to residential lending and community
support activities. Every 2 years, the Finance Board reviews the
community support performance of each member by taking into account
factors such as each member's Community Reinvestment Act performance and
its lending to first-time homebuyers. The Banks provide technical
assistance to their members in meeting the community support standards.
Financing Corporation
The Financing Corporation (FICO) was established by the Competitive
Equality Banking Act of 1987 (12 U.S.C. 1441) with the sole purpose of
issuing and servicing bonds, the proceeds of which were used to fund
thrift resolutions. The principal on the bonds was defeased with capital
contributions from the Banks. The Corporation has a three-member
directorate, consisting of the Managing Director of the Office of
Finance and two Federal Home Loan Bank presidents.
The Financing Corporation operates subject to the regulatory
authority of the Federal Housing Finance Board.
Sources of Information
Requests for information relating to human resources and procurement
should be sent to the Office of Resource Management, at the address
listed below.
For further information, contact the Executive Secretariat, Federal
Housing Finance Board, 1777 F Street NW., Washington, DC 20006. Phone,
202-408-2500. Fax, 202-408-2895.
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