Should regulators close the door to new FHLB entrants, or open it wide?
By Hannah Lang
A new effort by the Federal Housing Finance Agency to examine membership rules for the Federal Home Loan Bank System is reigniting an argument over whether policymakers should expand access to the system or impose tougher barriers. …But Karen Shaw Petrou, managing partner of Federal Financial Analytics, says the FHFA’s recommending expanded Home Loan Bank System membership would be contrary to FHFA Director Mark Calabria’s stated goal of limiting Home Loan bank activity to the system’s core mission of furthering housing and community lending. Easing the membership rules would not correspond with “Mark Calabria’s comments … about mission-driven reforms,” she said. “Expanding the system to REITs is not clearly mission-driven.”