The Federal Home Loan Bank System remains uniquely positioned to support local lending and economic growth through its member-focused cooperative model, the American Bankers Association told House lawmakers today.
The House Financial Services Subcommittee on Housing and Insurance held an oversight hearing on the FHLB system, which has been in place for more than 90 years. In a statement, ABA said the system fulfills an essential liquidity mission, with member institutions relying on FHLB advances to manage a wide range of funds, including mortgage lending.
“The value of the system is most evident during periods of market disruption,” ABA said. “When other funding sources become constrained or more expensive, the FHLBanks provide secured, predictable access to liquidity.”
The FHLB system supports affordable housing through its Affordable Housing Program and other initiatives, which finance housing for a large variety of low- and moderate-income households, ABA said. It also supports broader community and economic development efforts through grants and investments.
“For ABA member banks and the customers they serve, the Federal Home Loan Bank System is much more than a funding source,” ABA said. “It is a vital component of the nation’s financial infrastructure, providing dependable liquidity, supporting affordable housing, promoting community development and enhancing financial stability.”
