FOR IMMEDIATE RELEASE
ICBA Supports Strong GSE Regulator, Opposes Strict Portfolio Limits
Washington, D.C. (March 29, 2006)—The Independent Community Bankers of America (ICBA) along with eight other organizations reiterated support for a strong regulator for the housing government sponsored enterprises (GSEs) and urged the Senate to reject statutory limitations on the mortgage portfolios of the GSEs.
"Investing a new regulator with muscular authority to review and enforce GSE operating standards and compliance with mission is important to maintaining confidence in these entities which play such a critical role in our nation's housing finance system," the groups said in the letter. "Access to mortgage capital is a vital part of the functioning of the nation's mortgage market. By limiting GSE portfolios and forcing divestment of current holdings, we believe this provision would have negative consequences for the residential and multifamily real estate finance industry and borrowers."
Under consideration in the Senate is the Federal Housing Enterprise Regulatory Reform Act (S.190), which would create a new GSE regulator.
The letter noted that flexibility in the GSE portfolios strengthens the mortgage finance system in several ways:
- Ensuring a stable supply of mortgage capital;
- Lowering costs for mortgage capital;
- Encouraging investment from foreign markets;
- Managing systemic risk; and
- Strengthening multifamily lending.
In addition to ICBA, the letter was signed by the Council of State Community Development Agencies, the National Alliance of Independent Mortgage Bankers, the National Apartment Association, the National Association of Counties, the National Association of Local Housing Finance Agencies, the National Community Development Association, the National Multi-Housing Council, and the U.S. Conference of Mayors.
View the letter at www.icba.org.