Section 10(g)(1) of the Federal Home Loan Bank Act requires the Federal Housing Finance Board (Finance Board) to develop regulations establishing standards of community investment or service that Federal Home Loan Bank (FHLBank) members must meet in order to maintain access to long-term advances. The regulations must take into account factors such as an FHLBank member’s performance under the Community Reinvestment Act of 1977 (CRA), and its record of lending to first-time homebuyers. Pursuant to the requirements of section 10(g), the Finance Board amended its community support regulation requirement effective June 30, 1997. The regulation was published May 29, 1997 and is codified at 12 CFR part 936.
As amended, the community support regulation establishes standards a FHLBank member must meet in order to maintain access to long-term advances, and the review criteria the Finance Board must apply in evaluating a member’s community support performance. Each calendar quarter the Finance Board will select a portion of FHLBank System members for community support review so that each member’s community support performance will be reviewed every two years.
When selected for review, all members, including credit unions and insurance companies, will be required to fill out a one-page community support statement form that will be provided to them by the appropriate FHLBank. The form also is available on this site. Each FHLBank has a community investment department that can assist members in preparing their statements, and in assessing community needs and designing products and services that best meet those needs in the context of their size and resources
The FHLBanks also will provide to community groups and other interested parties a list of members selected in order to solicit comments on the community support performance of those members.
There are two community support performance standards: the CRA standard and the first-time homebuyer standard. To retain access to long-term advances, members subject to CRA must meet both standards, while members not subject to CRA, including insurance companies and credit unions, must meet only the first-time homebuyer standard.
CRA Standard
If a member’s last federal CRA rating is "outstanding" or "satisfactory," it will meet the standard.
If a member’s last federal CRA rating is "needs to improve," it will be placed on probation until it receives a new CRA rating. If it does not improve its rating during that period, its access to long-term advances will be restricted.
If a member’s last federal CRA rating is "substantial noncompliance," its access to long-term advances will be terminated.
First-time Homebuyer Standard
A member that provides adequate evidence of assistance to first-time homebuyers will meet the standard.
A member that provides inadequate evidence of assistance to first-time homebuyers will be placed on probation for one year. If performance does not improve in that year, access to long-term advances will be restricted.
Any members that do not respond to this factor will be restricted from access to long term advances.
For more information about the community support program, or to find out how to receive regular notice of members selected for review, please contact the FHLBank in your area. FHLBank addresses are located elsewhere on this site.
For additional community support information from the Finance Board, contact:
Penny Bates
Office of Policy
1777 F Street, N.W.
Washington, D.C. 20006
(202) 408-2574