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  • Comment Detail

  • Date: 10/27/14
    First Name: Donald
    Last Name: Moore
    Organization: First Central Bank McCook
    City: N/A
    State: N/A
    Attachment: N/A
    Number: RIN-2590-AA39

  • Comment

    1. The proposed rule includes significant, unnecessary, and highly damaging changes to long-standing membership rules for the FHLBank system that are inconsistent with the Federal Home Loan Bank Act and clear congressional intent.
    2. Between 13 and 93 banks could lose their membership in FHLBank Topeka as a result of the proposed rule, resulting, when combined with other entities that could also lose their membership rights, in as much as $1.54 billion in lost advances to existing members.
    3. Many community banks rely on FHLBank Topeka for advances and other products. Losing access to the FHLBank would have a negative impact on their customers and communities.
    4. If the proposed rule results in fewer members of FHLBank Topeka, it will result in a smaller FHLBank with fewer assets, reduced profits, lower retained earnings, a decreased market value of equity and capital stock, and fewer dollars available for the Affordable Housing Program.
    5. The proposed changes will inhibit the ability of the FHLBanks to serve the housing and community development needs of their districts. These changes would prove most burdensome to the small and medium-sized members of FHLBank Topeka at a time when they are already subject to a crushing burden of regulatory requirements.
    6. FHLBanks were a critical source of liquidity for financial institutions during the nation’s recent financial crisis. If a significant number of banks lose access to their FHLBank, the effect on communities will be significant.
    7. Policymakers should be looking for ways to increase economic activity by encouraging financial institutions to bolster responsible lending to home buyers, commercial real estate developers, small businesses, ag producers, and other job creators. The FHFA’s proposed rule would inhibit these activities and would adversely impact the U.S. economy.
    8. The proposed rule does not identify any safety and soundness reason for imposing new membership restrictions, nor does it present any information reflecting problems with the current membership rules. With no compelling benefits justifying adoption of the proposed rule, it should be withdrawn immediately.