[United States Government Manual] [June 01, 2007] [Pages 405-408] [From the U.S. Government Publishing Office, www.gpo.gov]FEDERAL HOUSING FINANCE BOARD 1625 I Street NW., Washington, DC 20006 Phone, 202-408-2500. Internet, www.fhfb.gov. Board of Directors: Chairman Ronald A. Rosenfeld Members: Geoffrey S. Bacino, Alicia R. Castaneda, Allan I. Mendelowitz Secretary of Housing and Urban Alphonso R. Jackson Development, ex officio Officials: Inspector General Edward Kelley General Counsel Neil R. Crowley, Acting [[Page 406]] Director, Office of Supervision Stephen M. Cross Director, Office of Management David A. Lee, Acting [For the Federal Housing Finance Board statement of organization, see the Code of Federal Regulations, Title 12, Part 900] ------------------------------------------------------------------------ The Federal Housing Finance Board ensures the safety and soundness of the Federal Home Loan Banks, their access to the capital markets, and the fulfillment of their housing finance mission. The Federal Housing Finance Board (Finance Board) was established by the Federal Home Loan Bank Act, as amended (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. 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 to ensure that the Banks operate in a safe and sound manner, carry out their housing finance mission, and remain adequately capitalized and able to raise funds in the capital markets. Savings associations, commercial banks, savings banks, credit unions, insurance companies, and other institutions are eligible to become members of the Federal Home Loan Banks. Federal Home Loan Banks The Federal Home Loan Banks are privately capitalized government sponsored enterprises, created to stimulate mortgage finance and provide liquidity to credit markets. The Banks provide credit to members, including savings and loan associations, commercial banks, federally insured credit unions, and insurance companies, and nonmembers, principally housing finance agencies, for use in mortgage lending and related activities. They use short and long-term advances (collateralized loans) to fund their lending activities and to maintain liquidity for their operations. Long-term advances may be used only to support residential housing finance and lending to small businesses, small farms, and small agricultural businesses. Most of the collateral supporting advances consist of mortgage assets. In addition to advances, most of the Banks purchase qualifying mortgage loans from members under various acquired member asset programs. Under these programs, the Bank manages the market risk, while the members bear most of the credit risk associated with the loans. The Banks are required to promote housing and community investment finance. Each Bank allocates 10 percent of its annual net income to fund a subsidy program known as the Affordable Housing Program (AHP). Under the AHP, a member may submit an application to its Bank for funds to be used to finance the purchase, construction, or rehabilitation of housing for very low and moderate-income households. AHP funds are also awarded through the Homeownership Set-Aside Program in which members obtain AHP funds from the Bank to provide grants to eligible low and moderate- income households for down-payment or assistance with closing and counseling costs associated with purchasing or renovating a house. Capital and Sources of Funds The Banks' principal source of capital is stock, which members are required to purchase as a condition of joining the Bank System. 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. These consolidated obligations consist of bonds (original [GRAPHIC] [TIFF OMITTED] T211657.038 [[Page 408]] maturity of 1 year or longer) and discount notes (original maturity of less than 1 year). Consolidated obligations are not guaranteed or insured by the U.S. government. However, the Banks' status as government sponsored enterprises enables them to raise funds at rates slightly higher than comparable obligations issued by the U.S. Treasury. Member deposits are also an additional source of funds. Financing Corporation The Financinas 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 resolve failed savings associations. The Corporation has a three-member directorate, consisting of the Managing Director of the Office of Finance and two Federal Home Loan Bank presidents. FICO is subject to the general oversight of the Finance Board. For further information, contact the Federal Housing Finance Board, 1625 I Street NW., Washington, DC 20006. Phone, 202-408-2500. Fax, 202-408- 2895. Internet, www.fhfb.gov. ------------------------------------------------------------------------