Frizell, Small Commercial Banks and the Federal Home Loan Bank System
, 25 Int'l Regional Sci.
"Some credit unions will be immediately and negatively impacted by this and it will be a deterrent for credit unions to join the federal home loan bank system
. Further, small banks have a statutory exemption and credit unions need parity," he said.
Although mission expansion and growth of public administrative organizations are often viewed skeptically as merely the result of institutional budget-grabbing, this case study of growth and expansion in the Federal Home Loan Bank System
by Hoffman (political science, Western Michigan U.) and Cassell (political science, Kent State U.) suggests that sometimes mission and expansion and growth can serve valuable public policy purposes.
Federal Home Loan Bank: Assets Percent of total assets (2009) Advances 62.1 All other assets 7.0 Securities 19.7 Mortgage loans held for portfolio 11.1 Source: "Federal Home Loan Bank System
Annual Reports", 2000-2009.
Q: Why is the combination of big and small banks so valuable to the Federal Home Loan Bank System
The Federal Home Loan Bank System
(FHLB) was established in 1932 to provide a federal lender for private institutions that specialize in home mortgage loans, including savings and loan associations (S&Ls), mutual savings banks, and life insurance companies.
The House Financial Services Committee passed NAA/NMHC-supported legislation (HR 1427) on March 29 to create a new regulator for Fannie Mae, Freddie Mac and the Federal Home Loan Bank system
1416), a bipartisan bill to strengthen the safety and soundness of government sponsored entities (GSEs) in the housing market--specifically housing giants Fannie Mae, Freddie Mac and the Federal Home Loan Bank system
. Included in the bill is the establishment of a new "affordable housing fund," that would be funded by the government sponsored entities.
By law, Reserve Banks act as fiscal agents for the following GSEs and international organizations: Fannie Mae; the Federal Home Loan Mortgage Corporation; entities of the Federal Home Loan Bank System
; the Farm Credit System; the Federal Agricultural Mortgage Corporation; the Student Loan Marketing Association; the Financing Corporation; the Resolution Funding Corporation; the World Bank; the Inter-American Development Bank; the Asian Development Bank; and the African Development Bank.
Less widely recognized are two emerging and potentially powerful sources of new competition for Fannie Mae and Freddie Mac: an expanded mortgage finance program by the Federal Home Loan Bank System
and new bank risk-based capital standards that are likely to be implemented in 2006.
In the wake of a $5 billion accounting restatement by Freddie Mac in 2003, various legislative proposals have been put forward to reorganize the regulatory oversight of Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System
. These proposals have been prompted by concerns about taxpayer liability associated with these housing government-sponsored enterprises (GSEs).
Fannie and Freddie total assets have increased 186 percent to $2.83 trillion since the beginning of 1997, with Federal Home Loan Bank System
assets up 193 percent to $857 billion.