As Washington Eyes Restructuring, Policy Leaders Consider Parts of Financial System That Work
WASHINGTON, Feb. 22, 2013 (GLOBE NEWSWIRE) -- Council of Federal Home Loan Banks president and CEO, John von Seggern, said today that the preliminary unaudited yearend 2012 combined operating highlights for the Federal Home Loan Banks released today demonstrate that the 12 regional cooperatives continue to be a strong and dependable part of the nation's financial system.
That is important, von Seggern said, because as repair of the financial system continues, the financial crisis of the past few years also revealed what is working for Americans in the U.S. economy.
"As Washington moves into the next phases of financial reform, policy leaders will ask the question: How do we preserve the parts of the system that work?" predicts von Seggern. "As proposals begin to emerge, the people who are shaping policies are looking to keep intact the things that are functioning well, just as much as they are eager to fix what's broken."
The chief executive cited the upcoming proposals of the Bipartisan Housing Commission, scheduled for release on February 25, as an example of efforts by housing leaders to put forward constructive ideas of both preservation and reform. Preliminary indications are that the blue-ribbon panel's report on housing and housing finance will include recommendations for what in the current system needs to be retained.
Top on the list of positive elements of the financial sector in his own view, von Seggern said, is the community banking system. "Community financial institutions, including community banks, thrifts, credit unions and insurance companies, have been stable players with the ability to know their customers and manage risks properly," said von Seggern. "They functioned efficiently during the financial crisis and are continuing to play vital roles for consumers and businesses as the U.S. economy recovers from recession.
Community financial institutions have a reliable and efficient source of funding in the Federal Home Loan Banks, according to von Seggern, who said that the 12 institutions that he represents proved themselves through the crisis to be strong, well-structured and focused on economic stability not short-term profits.
America's Federal Home Loan Banks are regional cooperatives owned by their members. They provide more than 7,000 community financial institutions everywhere in the country with funding necessary to serve consumers and businesses. They doubled their funding to local lenders when all other forms of liquidity dried up during the financial crisis and did not require any form of government support to carry out their mission.
"Working together as the community banking system, local lending institutions and the Federal Home Loan Banks were there for the American people in the last crisis and will be there in the future."
The Office of Finance's preliminary unaudited fourth quarter combined operating highlights for the Federal Home Loan Banks are available at www.fhlb-of.com
The Council of Federal Home Loan Banks logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=13861