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The Federal Housing Finance Agency (FHFA) has recently announced a Request for Comments (RFC) regarding proposed amendments to its regulation on the Responsibilities of Boards of Directors, Corporate Practices, and Corporate Governance for all its regulated entities. These amendments will require directors of all entities to have strategic business plans in effect throughout the year, including annual reviews, re-adoption and reporting requirements.
The FHFA was established by the Housing and Economic Recovery Act of 2008 (HERA) and is responsible for regulating and supervising Fannie Mae, Freddie Mac and the Federal Home Loan Bank System, which includes 11 banks and the Office of Finance. Its mission, as stated on their official website, is to “ensure that the housing government sponsored enterprises operate in a safe and sound manner so that they serve as a reliable source of liquidity and funding for housing finance and community investment.”
To meet their mission in accordance with their values of respect, excellence, integrity and diversity, the FHFA is seeking comments from the public about the proposed rule regarding responsibilities of the boards of directors for each of its regulated entities.
The proposed rule will require board of directors to
- Have a strategic business plan at all times which explains how the entity’s activities will help achieve its statutory purposes;
- Review their strategic business plan at least annually, re-adopt it every three years, and establish reporting and monitor implementation requirements; and
- Regard new provisions for current and emerging business risks.
In addition, the proposed rule will repeal two provisions of the current regulation and make a “conforming change” to the Office of Finance Board of Directors regulation.
NAWRB, as a leading voice for women in the housing and real estate ecosystem, will submit a comment shortly to provide the FHFA with insight for how financial institutions can better serve consumers’ needs and protect their hard-resources. This is a great opportunity for the public to voice their thoughts about decisions that affect them.
Click here to submit a comment.