FHFB Finalizes Appointment Process

The Federal Housing Finance Board has finalized an appointment process for public interest directors that allows the individual Federal Home Loan Banks to nominate one or two candidates for the FHFB's approval.Previously, these independent directors were selected and appointed by the FHFB. But that process came to halt several years ago when the White House stopped all appointments as part of its approach to reforming the regulation of the government-sponsored enterprises. In finalizing the new process, the FHFB dropped a proposed requirement that the FHLBanks submit two candidates for each vacancy. The final rule allows the FHLBanks the option of nominating one candidate, as recommended by the America's Community Bankers and others. FHLBank stakeholders were concerned that some good candidates might refuse to go through the nominating process if they only had a 50% chance of being appointed.