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FHFA symposium urges stronger partnerships between Federal Home Loan Banks and CDFIs to tackle housing affordability
Summary
FHFA convened Federal Home Loan Bank and CDFI leaders to press for concrete steps — data sharing, pilots and mission‑oriented collateral — to expand capital for underserved communities and address the housing affordability crisis.
Federal Housing Finance Agency officials and leaders from Federal Home Loan Banks and community development financial institutions met at an FHFA symposium to press for faster, practical steps to expand financing for underserved communities.
FHFA Director Sandra Thompson opened the meeting with a call for action, saying the nation faces a housing affordability crisis and urging home loan banks and CDFIs to “step up” and use their complementary capabilities to increase access to capital. Thompson highlighted the System at 100 review and said FHFA will pursue report recommendations, including clarifying the system mission and reducing barriers for mission‑oriented lending.
Praveen Raghavan, director of the Treasury CDFI Fund, explained the Fund’s programs (CDFI Program, Bank Enterprise Award, the Capital Magnet Fund, and New Markets Tax Credit), outlined recent changes to the CDFI certification application and said the Fund is building transactional‑level reporting to improve data on CDFI activities. He said the Fund is evaluating how to share aggregated results while protecting confidential data.
Panels of Federal Home Loan Bank and CDFI leaders focused on three recurring obstacles: inconsistent treatment of mission‑oriented collateral across FHLBs, limited secondary‑market price discovery for certain affordable‑housing loans (notably LIHTC loans), and operational onboarding and reporting burdens for non‑depository CDFIs seeking membership and advances. CDFI speakers described membership benefits — access to advances, deposit and guarantee products, AHP application privileges and convening opportunities — but said haircuts on collateral and different bank practices limit borrowing.
Bank credit officers said they rely on internal ratings and ongoing monitoring to manage member credit risk and cited a lack of standardized, timely CDFI data as an obstacle. CDFI representatives urged wider adoption of ARRIS standardized reporting and third‑party ratings to reduce information gaps and called for FHFA‑led data and valuation work.
On collateral, CDFIs and several FHLB representatives asked FHFA to help pilot mission‑oriented collateral programs that would test lower haircuts, improved mark‑to‑market treatment and alternative liquidations that preserve loans in performance. Banks noted regulatory constraints but said they are running pilots and voluntary programs to test new approaches and that FHFA guidance would accelerate system‑wide adoption.
FHFA staff said agency steps in the near term will include requests for input on core mission activities and mission‑oriented collateral parameters, a member‑credit management advisory bulletin and continued engagement to implement System at 100 recommendations. Deputy Joshua Stallings closed the day urging continued collaboration and promising FHFA follow‑through on practical reforms.
The symposium produced a clear next step: FHFA will solicit public input, and banks and CDFIs will expand pilots and share results, with the shared goal of increasing affordable housing and community development lending through clearer data, tested collateral treatments and repeatable voluntary programs.
