Washington Update

As a government-sponsored enterprise, the Bank works closely with Congress, the administration, the Federal Housing Finance Board, and banking and housing regulators to support the enactment of banking laws and regulations at the federal level that aid the Bank in its operation and the achievement of its federally chartered mission.

The Bank also works closely with local lawmakers, opinion makers, community groups, business leaders, and members in Arizona, California, and Nevada, the three states served by the Bank.

Regulatory Issues

• The Federal Housing Finance Board adopted a final rule (PDF) establishing procedures for the selection of appointed directors to the boards of the FHLBanks.
• On December 22, 2006, the Finance Board adopted a final rule (PDF) prohibiting an FHLBank from issuing new excess stock to members if the amount of excess stock exceeds 1% of an FHLBank’s assets. As part of its action, the Finance Board finalized a provision of the proposed rule requiring that the FHLBanks declare and pay dividends only out of previously retained earnings and current net earnings, not projected or anticipated earnings.
• On October 23, 2006, the Bank filed a comment letter on the Finance Board's request for comment (PDF) on its proposed examination rating system for the FHLBanks and Office of Finance.
• On September 20, 2006, the Bank filed a comment letter on the Federal Deposit Insurance Corporation's proposed rule (PDF), which posed the following questions: 1) should FHLBank advances be treated as “volatile liabilities?” and 2) should the FDIC charge “higher assessment rates to institutions that have significant amounts of secured liabilities?”