    [United States Government Manual]
    [June 01, 2002]
    [Pages 408-411]
    [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. Internet, www.fhfb.gov.

    Board of Directors:

    Chairman                                          John T. Korsmo
    Members:                                          Allan I. Mendelowitz,
                                                              Franz S.
                                                              Leichter, J.
                                                              Timothy
                                                              O'Neill
        (Secretary of Housing and Urban               Mel R. Martinez
                Development, ex officio)
            Housing and Urban Development             John C. Weicher
                    Secretary's Designee to
                    the Board
    Counsels to the Chairman                          Thomas D. Casey, Shane
                                                              C. Goettle
    Special Assistant to the Chairman                 N. Carter Wood
    Senior Policy Advisor to the Chairman             Joseph M. Ventrone
    Assistants to Board Director                      Julie P. Fallon,
                                                              Charles D.
                                                              Jones, Linda
                                                              Fleming McGhee

    Officials:

    Managing Director                                 James L. Bothwell
    Director, Office of Communications                Stephen P. Hudak
    Director, Office of Policy, Research, and         Scott L. Smith, Acting
            Analysis
    Director, Office of Resource Management           Judith Hofmann
    Director, Office of Supervision                   (vacancy)
    General Counsel                                   Arnold Intrater,
                                                              Acting

    [[Page 409]]

    Inspector General                                 Edward Kelley
    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 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 managed 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
    Chairperson. 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 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-mortgageloansare eligible to become
    members of the Federal Home Loan Banks. The Finance Board supervises the
    Federal Home Loan Banks and ensures that they carry out their housing
    finance and community investment mission and remain adequately
    capitalized and able to raise funds in the capital markets. The
    functions of the Finance Board include:
        --prescribing rules and regulations governing the Bank System's
    capital, lending, financial management, and investment activities;
        --maintaining Bank System financial and membership databases 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;
        --annually examining each Federal Home Loan Bank and the Office of
    Finance;
        --requiring an independent financial audit of each Bank, the Office
    of Finance, the Financing Corporation, and the Bank System;
        --appointing public interest directors to the board of directors of
    each Bank and establishing the rules by which the Banks elect the
    remaining directors; and
        --setting standards for the review and approval of applications for
    Bank membership.

    Regional Banks

    The System includes 12 regional Federal Home Loan Banks, each of which
    is a Government-sponsored enterprise, owned by its members. Each Bank is
    managed by its board of directors, which is comprised of appointed
    public interest and elected industry directors. The Finance Board
    appoints the public interest directors, and the Banks conduct 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. In accordance with the Gramm-Leach-Bliley Act, which became
    law on November 12, 1999, the Finance Board has adopted regulations for
    a new risk-based capital structure for the Banks, which will replace the
    current capital structure upon implementation of each Bank's capital
    structure plan, which is to

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    be developed by the Bank and approved by the Finance Board. The new
    capital structures are subject to possible transition periods of up to 3
    years. The Banks fund their lending and member asset acquisition
    activities 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 Federal Home Loan Banks 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. Under the Gramm-Leach-Bliley Act, advances to
    community financial institutions may also be made to finance small
    businesses, small farms, and small agribusinesses, and advances to such
    members may be secured by secured small business loans and agricultural
    loans.
        The Banks have established mortgage asset purchase programs to
    assist their members. These programs, such as the Mortgage Partnership
    Finance program developed by the Federal Home Loan Bank of Chicago,
    involve the investment by the Banks in mortgages they acquire from their
    members. Under these programs, members selling mortgages to the Banks
    continue to bear a significant portion of the credit risk.
        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 affordable rental housing
    targeted to households with very low, low, or moderate incomes. The
    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.

    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 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 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. Internet, www.fhfb.gov.

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