Home Loan Bankmortgage bank
Launched in 1932, the FHLBanksystem was charters by Congress and has the main task of making available to member finance institutes finance instruments and activities that support and improve the funding of residential and communal loans. Each of the 11 FHLBanks is organised as a cooperative society held and managed by its member finance institution, which today includes saving and loan syndicates (thrifts), business banking groups, cooperative societies andinsurers.
Every FHLBank is obliged to have at least one capital category listed with the SEC, even though its debts are not listed. FLB ank's 11 banking systems are operated by over 7,300 regulatory entities from all 50 states, US properties and jurisdictions. The FHLBanks' own funds are hold by these owners/members and are not public.
Institutes must buy shares to become members. ULB banks are self-capitalising as members try to raise their borrowings, they must first buy extra shares to sustain the business. ULB banks are exempted from all taxes levied by the Federation, the Länder and the municipalities, with the exception of municipal property taxes.
Investment in FHL banks is exempted from Basel II (which would normally impose a 400% exposure weight for non-traded equities, but the exemptions allow only 100%). FHL banks estimate that they will contribute 10% of net income per year to accessible residential programmes. ULB banks' missions reflect a common objective (improving accessibility to accommodation and support groups through lending to member banks ), but all 11 are private capitalised and are not supported by the payer except for fiscal benefits.
The FHLBanks Office of Finance issued the 2014 Financial Report on 27 March 2015. For 2014, the FHL banks reported an annual surplus of USD 2,245 million. The total value of the FHLBanks' total funds was USD 913. as of December 31, 2014. In 2014, the FHL banks made payable residential mortgage loans amounting to USD 269 million.
As at 31 December 2014, each of the FHLBanks complied with its legal MCR[ 2] and the FHLBanksystem as a whole was above its MCR. In the aftermath of the global economic crisis, ULB banks were formed by the Federal Home Loan Bank Board (FHLBB) under the Federal Home Loan Bank Act of 1932.
The aim was to make available resources for "construction and loan institutions", to make available cash and mortgage loans. In the wake of the austerity and credit crises of the eighties, the Financial Institution Reform, Recovery and Enforcement Act of 1989 (FIRREA) repealed the FHLBB and assigned the supervisory function of the FHL banks to the Federal Housing Finance Board (FHFB) and to the Office of Thrift Supervision (OTS) in the Ministry of Finance....
The FIRREA also permitted all custodian bankers with federal insurance to join the FHA bank system, as well as business bankers and cooperative lending societies. In the wake of the subprime mortgage crises at the end of the 2000s, the 2008 Housing and Economic Stimulus Act (HERA) superseded the Federal Housing Agency (FHFB) by the Federal Housing Agency (FHFA). Until 31 December 2009, the Minister of Finance was authorised to buy any amount of FLB Bank bonds, after which the ceiling would rise again to the initial USD 4 billion.
The US Treasury Department on 7 September 2008 heralded a new loan for the three government-sponsored residential real estate companies. Thus, the Minister of Finance was able to buy any amount of debts of FHLBank that would be pledged as security in the form of advance payments and other sums. Following the downturn at the end of 2000, Section 312 of the Dodd-Frank Wall Street Reform and Consumer Protection Act ordered the OTS to merge with the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board of Governors and the Consumer Financial Protection Bureau (CFPB) as of 21 July 2011.
See Fannie Mae and Freddie Mac for a listing of items on the Federal Home Loan Bank System, Fannie Mae and Freddie Mac: