Notice2022-28331
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
December 29, 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 $1,417,000,000, 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 will take effect on January 1, 2023.
Full Text
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<title>Federal Register, Volume 87 Issue 249 (Thursday, December 29, 2022)</title>
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[Federal Register Volume 87, Number 249 (Thursday, December 29, 2022)]
[Notices]
[Pages 80184-80185]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-28331]
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FEDERAL HOUSING FINANCE AGENCY
[No. 2022-N-17]
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 $1,417,000,000, 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 will take
effect on January 1, 2023.
FOR FURTHER INFORMATION CONTACT: Janna Bruce, Division of Federal Home
Loan Bank Regulation, (202) 649-3202, <a href="/cdn-cgi/l/email-protection#3278535c5c531c704047515772545a54531c555d44"><span class="__cf_email__" data-cfemail="c58fa4ababa4eb87b7b0a6a085a3ada3a4eba2aab3">[email protected]</span></a>; or Vickie
Olafson, Assistant General Counsel, (202) 649-3025,
<a href="/cdn-cgi/l/email-protection#c593aca6aeaca0eb8aa9a4a3b6aaab85a3ada3a4eba2aab3"><span class="__cf_email__" data-cfemail="b8eed1dbd3d1dd96f7d4d9decbd7d6f8ded0ded996dfd7ce">[email protected]</span></a>, (not tollfree 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 2022, FHFA set the CFI asset
cap at $1,323,000,000, which reflected a 6.8 percent increase over
2021, based upon the increase in the CPI-U between 2020 and 2021.\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 87 FR 1147 (Jan. 10, 2022).
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II. The CFI Asset Cap for 2023
As of January 1, 2023, FHFA will increase the CFI asset cap to
$1,417,000,000, which reflects a 7.1 percent increase in the unadjusted
CPI-U from November 2021 to November 2022. 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
[[Page 80185]]
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.
Joshua R. Stallings,
Deputy Director, Division of Federal Home Loan Bank Regulation, Federal
Housing Finance Agency.
[FR Doc. 2022-28331 Filed 12-28-22; 8:45 am]
BILLING CODE 8070-01-P
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