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Last week, the Federal Housing Finance Agency (FHFA) released a long-awaited report, capturing its observations from a review of the Federal Home Loan Bank system.

The report contained many legislative and regulatory recommendations to ensure that the Federal Home Loan Banks are focused on their core mission. This includes plans for the FHFA to issue a proposed rule that would clarify the mission of the Federal Home Loan Banks and provide metrics and thresholds for measuring the achievement of that mission.

The FHFA also articulated plans to require that certain members have at least 10 percent of their assets in residential mortgage loans or equivalent mission assets on an ongoing basis to remain eligible for FHLB financing. It is not clear, however, which members this will affect.

Further, the report called upon Congress to decide whether FHLB membership ought to be expanded to non-bank lenders and REITs. Our friends at the Independent Community Bankers of America (ICBA) have captured these and other recommendations from the report in a summary which can be found here.