The Federal Housing Finance Agency today published a regulatory interpretation clarifying how cooperativas in Puerto Rico can become Federal Home Loan Bank system members. Cooperativas are state-chartered financial institutions that primarily serve rural and low-income urban areas in Puerto Rico. Many of them are Treasury-certified community development financial institutions, according to FHFA, which said that no cooperativa has yet become a member of the FHLB system.
Today’s regulatory interpretation is the result of recommendations included in a report that FHFA released in November last year following a comprehensive evaluation of the FHLB system. The primary finding of the report said was that home loan banks must appropriately support housing and community development in their districts, in addition to providing liquidity to members. FHFA noted that priorities in 2024 include: clarifying the FHLB system’s mission; aligning eligibility requirements for different types of FHLB members; and streamlining requirements related to the Affordable Housing Program.
