Notice2022-00197
Notice of Annual Adjustment of the Cap on Average Total Assets That Defines Community Financial Institutions
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
January 10, 2022
Issuing agencies
Federal Housing Finance Agency
Abstract
The Federal Housing Finance Agency (FHFA) has adjusted the cap on average total assets that is used in determining whether a Federal Home Loan Bank (Bank) member qualifies as a "community financial institution" (CFI) to $1,323,000,000, based on the annual percentage increase in the Consumer Price Index for all urban consumers (CPI-U), as published by the Department of Labor (DOL). These changes took effect on January 1, 2022.
Full Text
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<title>Federal Register, Volume 87 Issue 6 (Monday, January 10, 2022)</title>
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[Federal Register Volume 87, Number 6 (Monday, January 10, 2022)]
[Notices]
[Page 1147]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-00197]
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FEDERAL HOUSING FINANCE AGENCY
[No. 2022-N-1]
Notice of Annual Adjustment of the Cap on Average Total Assets
That Defines Community Financial Institutions
AGENCY: Federal Housing Finance Agency.
ACTION: Notice.
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SUMMARY: The Federal Housing Finance Agency (FHFA) has adjusted the cap
on average total assets that is used in determining whether a Federal
Home Loan Bank (Bank) member qualifies as a ``community financial
institution'' (CFI) to $1,323,000,000, based on the annual percentage
increase in the Consumer Price Index for all urban consumers (CPI-U),
as published by the Department of Labor (DOL). These changes took
effect on January 1, 2022.
FOR FURTHER INFORMATION CONTACT: Janna Bruce, Division of Federal Home
Loan Bank Regulation, (202) 649-3202, <a href="/cdn-cgi/l/email-protection#c68ca7a8a8a7e884b4b3a5a386a0aea0a7e8a1a9b0"><span class="__cf_email__" data-cfemail="feb49f90909fd0bc8c8b9d9bbe9896989fd0999188">[email protected]</span></a>; or Lindsay
Spadoni, Senior Counsel, (202) 649-3634, <a href="/cdn-cgi/l/email-protection#eca08582889f8d95c2bf9c8d88838285ac8a848a8dc28b839a"><span class="__cf_email__" data-cfemail="a6eacfc8c2d5c7df88f5d6c7c2c9c8cfe6c0cec0c788c1c9d0">[email protected]</span></a>, (not
toll-free numbers), Federal Housing Finance Agency, Constitution
Center, 400 Seventh Street SW, Washington, DC 20219.
SUPPLEMENTARY INFORMATION:
I. Statutory and Regulatory Background
The Federal Home Loan Bank Act (Bank Act) confers upon insured
depository institutions that meet the statutory definition of a CFI
certain advantages over non-CFI insured depository institutions in
qualifying for Bank membership, and in the purposes for which they may
receive long-term advances and the collateral they may pledge to secure
advances.\1\ Section 2(10)(A) of the Bank Act and Sec. 1263.1 of
FHFA's regulations define a CFI as any Bank member the deposits of
which are insured by the Federal Deposit Insurance Corporation and that
has average total assets below the statutory cap.\2\ The Bank Act was
amended in 2008 to set the statutory cap at $1 billion and to require
FHFA to adjust the cap annually to reflect the percentage increase in
the CPI-U, as published by the DOL.\3\ For 2021, FHFA set the CFI asset
cap at $1,239,000,000, which reflected a 1.2 percent increase over
2020, based upon the increase in the CPI-U between 2019 and 2020.\4\
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\1\ See 12 U.S.C. 1424(a), 1430(a).
\2\ See 12 U.S.C. 1422(10)(A); 12 CFR 1263.1.
\3\ See 12 U.S.C. 1422(10)(B); 12 CFR 1263.1 (defining the term
``CFI asset cap'').
\4\ See 86 FR 6650 (Jan. 22, 2021).
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II. The CFI Asset Cap for 2022
As of January 1, 2022, FHFA increased the CFI asset cap to
$1,323,000,000, which reflects a 6.8 percent increase in the unadjusted
CPI-U from November 2020 to November 2021. Consistent with the practice
of other Federal agencies, FHFA bases the annual adjustment to the CFI
asset cap on the percentage increase in the CPI-U from November of the
year prior to the preceding calendar year to November of the preceding
calendar year, because the November figures represent the most recent
available data as of January 1st of the current calendar year. The new
CFI asset cap was obtained by applying the percentage increase in the
CPI-U to the unrounded amount for the preceding year and rounding to
the nearest million, as has been FHFA's practice for all previous
adjustments.
In calculating the CFI asset cap, FHFA uses CPI-U data that have
not been seasonally adjusted (i.e., the data have not been adjusted to
remove the estimated effect of price changes that normally occur at the
same time and in about the same magnitude every year). The DOL
encourages use of unadjusted CPI-U data in applying ``escalation''
provisions such as that governing the CFI asset cap, because the
factors that are used to seasonally adjust the data are amended
annually, and seasonally adjusted data that are published earlier are
subject to revision for up to five years following their original
release. Unadjusted data are not routinely subject to revision, and
previously published unadjusted data are only corrected when
significant calculation errors are discovered.
Louis M. Scalza,
Acting Deputy Director, Division of Federal Home Loan Bank Regulation,
Federal Housing Finance Agency.
[FR Doc. 2022-00197 Filed 1-7-22; 8:45 am]
BILLING CODE 8070-01-P
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