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Joint News Release

America’s Community Bankers
American Bankers Association
Independent Community Bankers of America
Council of Federal Home Loan Banks

Contacts: ACB–Robert Schmermund, (202) 857-3104; ABA–Catherine Pulley, (202) 663-5468; ICBA–Ann Grochala, (202) 659-8111; Council–Malin Jennings, (202) 955-0002.

WASHINGTON, D.C., April 10, 2000 — The Federal Housing Finance Board was urged today to refrain from developing a regulation defining the Federal Home Loan Banks’ mission and mission-related assets at least until a new capital structure for the Bank System is in place.

The request was made by national trade associations representing virtually every FHLBank member institution. The groups are: America’s Community Bankers, the American Bankers Association, the Independent Community Bankers of America and the Council of Federal Home Loan Banks. The FHFB is expected to initiate a rulemaking at its April 12 board meeting.

"We believe that the FHLBanks’ mission has already been adequately addressed by the Congress," the groups said in a letter to FHFB Chairman Bruce Morrison. If the FHFB decides to proceed anyway with a mission achievement analysis, "it should be done only in conjunction with development of the new capital structure and with the active participation of the members of the system," the groups said.

The FHLBanks continue to successfully meet their historical mission of providing liquidity to member financial institutions, increasing credit availability and lowering the costs for housing and community development in their communities. The FHFB is seeking to change what has worked well by attempting to manage the Bank System’s purpose and role through a mission achievement policy not envisioned in the just-renewed statutory mandate.

The groups provided Morrison with a position paper on mission achievement, stressing the need for the FHLBanks and their members to work in partnership in serving communities’ housing and credit needs. The groups suggested that the FHFB, the Council, ACB, the ABA and the ICBA jointly conduct focus group sessions to discuss the evolution of regulations on capital and mission assets before they are issued for comment.

The copy of the joint letter is linked.