Notice2024-00491
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 12, 2024
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 $1,461,000,000, 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 are effective as of January 1, 2024.
Full Text
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<title>Federal Register, Volume 89 Issue 9 (Friday, January 12, 2024)</title>
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[Federal Register Volume 89, Number 9 (Friday, January 12, 2024)]
[Notices]
[Pages 2225-2226]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-00491]
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FEDERAL HOUSING FINANCE AGENCY
[No. 2024-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 $1,461,000,000, 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 are
effective as of January 1, 2024.
FOR FURTHER INFORMATION CONTACT: Janna Bruce, Division of Federal Home
Loan Bank Regulation, (202) 649-3202, <a href="/cdn-cgi/l/email-protection#c389a2adada2ed81b1b6a0a683a5aba5a2eda4acb5"><span class="__cf_email__" data-cfemail="86cce7e8e8e7a8c4f4f3e5e3c6e0eee0e7a8e1e9f0">[email protected]</span></a>; or Carly
Malamud, Counsel, Office of General Counsel, (202) 649-3098,
<a href="/cdn-cgi/l/email-protection#ffbc9e8d9386d1b29e939e928a9bbf9997999ed1989089"><span class="__cf_email__" data-cfemail="c586a4b7a9bceb88a4a9a4a8b0a185a3ada3a4eba2aab3">[email protected]</span></a>, (these are not toll-free numbers), Federal
Housing Finance Agency, Constitution Center, 400 Seventh Street SW,
Washington, DC 20219. For TTY/TRS users with hearing and speech
disabilities, dial 711 and ask to be connected to any of the contact
numbers above.
SUPPLEMENTARY INFORMATION:
I. Statutory and Regulatory Background
The Federal Home Loan Bank Act (Bank Act) confers upon insured
depository institutions that meet the
[[Page 2226]]
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 2023, FHFA set the CFI asset cap at $1,417,000,000, which
reflected a 7.1 percent increase over 2022, based upon the increase in
the CPI-U between 2021 and 2022.\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 80184 (Dec. 29, 2022).
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II. The CFI Asset Cap for 2024
As of January 1, 2024, FHFA will increase the CFI asset cap to
$1,461,000,000, which reflects a 3.1 percent increase in the unadjusted
CPI-U from November 2022 to November 2023. Consistent with the practice
of other Federal agencies required to calculate and make annual
adjustments based on CPI-U changes, 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.
Joshua R. Stallings,
Deputy Director, Division of Federal Home Loan Bank Regulation, Federal
Housing Finance Agency.
[FR Doc. 2024-00491 Filed 1-11-24; 8:45 am]
BILLING CODE 8070-01-P
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