The House Financial Services Committee advanced a measure on Friday that was introduced by Rep. Steve Stivers (R-Ohio) to boost the housing market by providing regulatory relief to some community-based enterprises.
The Capital Access for Small Community Financial Institutions Act would allow privately insured credit unions to apply for membership in the Federal Home Loan Bank system.
“Purchasing a home is an important part of the American dream,” Stivers, a member of the House Financial Services Committee, said. “With the continued stagnation in the housing market, I believe it is important to ensure all credit unions have the liquidity and ability to make home loans to their members.”
The FHLB system has provided credit and liquidity for mortgage lending – to main street institutions in particular – since its inception in 1932. A number of privately insured credit unions that represent firefighters, teachers, churches and small businesses in nine states have been blocked from applying to the FHLB system for more than 20 years due to a legislative oversight.
Stivers’ bill would amend the Federal Deposit Insurance Act so that private deposit insurers of credit unions would be required to submit audit reports to the National Credit Union Administration and to the Federal Housing Finance Agency, if the credit union is a member of an FHLB.
A state’s supervising agency would then be required to provide the National Credit Union Administration, upon request, with any information it has about private deposit insurers of credit unions that are FHLB members and do not have federal deposit insurance.