The Home Loan Banks were chartered by Congress in 1932 to provide liquidity to the U.S. mortgage market. The banks are also permitted to make unsecured loans to foreign and domestic financial institutions to enhance revenue under the terms of their congressional charters.
The FHFA failed to notice that some of the banks had made loans exceeding regulatory limits, the Office of Inspector General said. In one case, an unidentified Home Loan Bank using a manual evaluation system failed to notice that a borrower had been subject to a credit-rating downgrade, auditors found.
FHFA officials described the agency’s rules governing unsecured lending as “outdated and overly permissive,” according to the report.
“Even when an FHLBank operates within the established limits it can amass the sort of large unsecured credit exposure that has been the source of considerable regulatory concern,” the auditors found.
Thursday, June 28, 2012
U.S. Home Loan Banks Overexposed in Europe, Audit Finds - Bloomberg
U.S. Home Loan Banks Overexposed in Europe, Audit Finds - Bloomberg
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For those home buyers that has lack of investment to buy a house property then it is their best time to look or get a home loan on a bank or company in order to finance a money that you can use to purchase a house but of course you should follow the requirements and guidelines on how to get a home loan.
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