A bill that would create a legislative framework for a covered bond market in the U.S., as well as a potential competitor for the Federal Home Loan Bank system, was introduced this week in the Senate, a counterpart to a long-standing covered bond bill awaiting final approval in the House.The United States Covered Bond Act, S. 1835, sponsored by Sens. Kay Hagan, D-NC, and Bob Corker, R-TN, is nearly identical to a House bill of the same name sponsored by Rep. Scott Garrett, R-NJ, and Carolyn Maloney, D-NY, H.R. 940.

It will be months rather than weeks before the Federal Housing Finance Agency and other government departments are ready to deploy a plan for bulk sales of the inventory of government-owned foreclosed properties, according to the head of the FHFA.Testifying before the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises last week, FHFA Acting Director Edward DeMarco told members that with the long-awaited revision of the Home Affordable Refinance Program out of the way, focusing on the government’s ample real estate owned inventory is the “next priority.”

A bill introduced in the Senate this week would “responsibly unwind” Fannie Mae and Freddie Mac and “end the dependence on the government for housing finance.” Sen. Bob Corker, R-TN, said he introduced the Residential Mortgage Market Privatization and Standardization Act to start a conversation on how to best to rebuild the mortgage finance market.

Legislative and executive branch policymakers should carefully consider curbing investment portfolios of the Federal Home Loan Banks, say former Bank officials, while a current top Bank official says any such changes in the FHLBanks’ investment authority could undermine the system’s ability to carry out its mission.Since 1990, when Congress broadened the FHLBanks’ previously restricted membership, the pressures for dividends, price competition for advances and increases in required capital levels have significantly increased the “investment” portion of the Banks’ balance sheets, according to former Federal Housing Finance Board Chairman Bruce Morrison.

The Federal Home Loan Bank of Dallas has rolled out a new home modification grant program for disabled veterans who were injured in the line of duty during post-Sept. 11, 2001, service.FHLBank of Dallas has allocated $250,000 for its Housing Assistance for Veterans (HAVEN) program effective Oct. 3.HAVEN grants are available through participating FHLB Dallas member institutions to assist individuals in FHLB Dallas's five-state district of Arkansas, Louisiana, Mississippi, New Mexico and Texas.

In a move that could potentially prolong already protracted litigation, a U.S. District Court judge in New York ruled last week that a proposed $8.5 billion settlement over Bank of America’s non-agency mortgage-backed securities belongs in federal and not state court.Judge William Pauley denied a motion by the Bank of New York Mellon to move the lawsuit filed by BofA Countrywide non-agency MBS investors back to New York State Supreme Court. Eleven entities sharing the name Walnut Place petitioned for the federal court venue, claiming the case’s size and complexity qualified it for a “mass action.” Judge Pauley agreed.

Any changes that would restrict membership or narrow the Federal Home Loan Banks’ mission should come first from Congress not by administrative fiat, Bank officials told House members this week.FHLBank of Dallas Chairman Lee Gibson testified before the House Financial Services Subcommittee on Oversight and Investigations that explicit Congressional guidance is both necessary and proper before any fundamental alteration of the FHLBank system is imposed.

The Federal Home Loan Bank of Chicago’s long awaited capital stock conversion plan has received the thumbs up from the Federal Housing Finance Agency, moving the Bank a giant step toward regaining equal footing with its fellow FHLBanks.

Ginnie Mae is following its own path in exploring potential changes to servicer compensation, a project that parallels the Federal Housing Finance Agency’s Joint Initiative on Fannie Mae/Freddie Mac servicing compensation. As part of the FHA’s effort to improve default servicing, Ginnie Mae and other government housing agencies will be working separately to develop better claims mechanisms and pooling services as well as clearer risk and warranty delineations to improve the value of securitizations, the FHFA said. In a discussion paper, the FHFA, which oversees Fannie Mae, Freddie Mac and the Federal Home Loan Banks, said ...