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Contact:	Robert Schmermund (202) 857-3104 Jim Eberle (202) 857-3145	Jim Eberle (202) 857-3145 (work) (703) 893-2593 (home) [email protected]	For Immediate Release September 25, 2003 #03-43
E-mail: [email protected]

AMERICA’S COMMUNITY BANKERS CALLS FOR REGULATOR OF HOUSING GSES TO BE STRONG, INDEPENDENT

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WASHINGTON, D.C. — America’s Community Bankers’ primary recommendation to Congress today on the regulation of the housing government sponsored enterprises — Fannie Mae, Freddie Mac and the Federal Home Loan Bank System — was that any new regulatory structure must be strong and independent.

Testifying at a hearing of the House Financial Services Committee, ACB Chairman D. Russell Taylor said ACB strongly supports the committee’s efforts to strengthen the regulation of the three entities, but also strongly believes that any new agency created within the Treasury Department must have independence. Taylor is also president and CEO, Rahway Savings Institution, Rahway, N.J.

While Taylor’s testimony focused on proposals to strengthen the regulation of Fannie and Freddie, he said that any solution may have a direct impact on the FHLBank System.

He said ACB “strongly endorses the administration’s position that the new agency must have the authority to review both current and future programs of Freddie Mac and Fannie Mae. In particular, new activities should be subject to an application and approval process similar to what is in place for bank holding companies today.”

Taylor said ACB also strongly agrees with the administration position that, while the existing capital regulation adopted by OFHEO should be the new agency’s starting point, “there should be no limit on its ability through rulemaking to increase capital requirements for Fannie Mae and Freddie Mac.”

Taylor said that any new regulatory agency must have a complete exemption from the congressional appropriations process, similar to the exemption enjoyed by the other financial regulators.

Taylor said ACB’s policymaking bodies are currently weighing the pros and cons on whether regulation of the FHLBank System should be included in a new Treasury agency. He reported that ACB members want a regulator of the housing GSEs that is “as independent as the nation’s other financial regulators.”

Click here to read the Testimony

America’s Community Bankers is the national trade association committed to shaping the future of banking by being the innovative industry leader strengthening the competitive position of community banks. To learn more about ACB, visit www.AmericasCommunityBankers.com.

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