WASHINGTON—The Federal Housing Finance Agency Tuesday announced changes to Federal Home Loan Bank membership eligibility requirements, and those changes do not include a proposal that FHLB members, such as credit unions, hold 10% of their total assets in residential mortgage loans on an ongoing basis.
NAFCU had opposed the requirement and applauded the FHFA for its decision.
“NAFCU is pleased the agency heeded our suggestion by not imposing the 10% standard on an ongoing basis,” said NAFCU Executive Vice President of Government Affairs and General Counsel Carrie Hunt. “NAFCU firmly believes that credit unions should have the flexibility to manage their mortgage portfolios with the best interest of their members in mind, rather than having to manage to meet an arbitrary standard. Extending the 10% standard on an ongoing basis would have unnecessarily restricted a credit union’s ability to provide the mortgage financing needed by their members and the communities that they serve.”
NAFCU said it still questions other aspects of the rule and is analyzing the impact to its members.
CUNA also weighed in on the decision.
“Today’s actions by the FHFA will ensure continued access to the liquidity and flexibility the FHLB system provides, tools which help many credit unions manage their mortgage portfolios more effectively," said CUNA President and CEO Jim Nussle. "Credit unions understand the needs of their members, and removing the unnecessary ongoing burden of demonstrating sufficient mortgage assets for FHLB affiliation is a big win for member-owned financial institutions.”