Federal Housing Finance Board. The Finance Board is an independent regulatory agency of the executive branch of the U.S. government. The agency ensures that the FHLBanks, which are privately capitalized, government-sponsored enterprises, operate in a safe and sound manner, carry out their housing and community development finance mission, and remain adequately capitalized and able to raise funds in the capital markets.

• Finance Board approved a proposed rule, April 9, 2008, authorizing the FHLBanks to establish Affordable Housing Program homeownership set-aside programs for refinancing subprime mortgage loans. The rule is open to a 60-day comment period beginning from the date of publication in the Federal Register.



• Finance Board authorized the FHLBanks to increase their purchases of agency mortgage backed securities (MBS) from 300 percent of capital to 600 percent of capital for two years, effective immediately. The resolution was passed March 24, 2008.

GSE Bill Passes Full House, Introduced in Senate Committee.

• The House of Representatives voted 313-104 on May 22, 2007 to pass H.R. 1427, “Federal Housing Finance Reform Act of 2007.” The bill would create an independent agency to oversee the housing enterprises Freddie Mac, Fannie Mae and the Federal Home Loan Banks. On April 12, 2007 Senators Hagel, Dole, Sununu and Martinez introduced S. 1100, “The Federal Housing Enterprise Regulatory Reform Act of 2007” to the Senate Banking Committee.



• Senator Dodd held a hearing of the Committee on Banking, Housing and Urban Affairs, February 7, 2008, “Reforming the Regulation of the GSEs.”

H.R. 5720, Housing Assistance Tax Act of 2008. This bill, which passed out of the Ways & Means Committee on April 9, 2008, by a vote of 35-5, contains a provision supported by the FHLBanks. Section 143 amends the Internal Revenue Code to allow FHLBanks to guarantee tax-exempt bonds for economic development, authority already extended to other GSEs. This provision is based on H.R. 2091, introduced by Rep. Levin (D-MI) and Rep. English (R-PA) with strong bipartisan support from the House Finance Services Committee and Ways and Means. The companion Senate bill, S. 1963, was introduced by Senators Rockefeller (D-WV) and Crapo (R-ID).

H.R. 5723, Emergency Student Loan Market Liquidity Act of 2008. Introduced by Rep. Kanjorski (D-PA), this bill would authorize the FHLBanks to invest in student loan securities and accept student loans as collateral from member institutions. This authority would be granted for a two-year period beginning upon enactment.

H.R. 3221, Foreclosure Prevention Act of 2008. Senate bill passed April 10, 2008, by a vote of 84-12. This bill has a provision that would require the Finance Board to expand AHP authority to refinance first mortgage loans for income eligible families. This is not inconsistent with the Finance Board’s proposed rule.