The FHLBank is extending the terms and reducing the haircut on collateral pledged by non-depository CDFIs and state-chartered HFAs (which technically aren’t even members).

A new advisory bulletin streamlines the application process for an affordable housing subsidy and makes the rules more compatible with those of other affordable housing funders.

Affordable housing and community development advocates say taxpayers aren’t getting enough for the government subsidy of the FHLBanks. The FHLBanks say critics misunderstand their federal support.

The Council of Federal Home Loan Banks said Treasury’s proposal that the FHLBanks use their excess retained earnings to support affordable housing is asking them to operate on minimum capital levels.

Newly published comment letters show that housing and community advocacy groups support FHFA’s plan to use member incentive programs to encourage more mission-oriented lending by the FHLBanks.

The FHLBanks last year agreed to voluntarily raise their contributions to affordable housing programs from 10% of net income to 15%, but they balked at Treasury’s suggestion to increase that to 20%.

All but one of the regional banks experienced a sequential decline in net income, but most reported an increase in voluntary contributions to mission-related activities. (Includes data table.)

FHFA’s proposed rule responds to market trends that have made it difficult for the GSEs to meet their benchmark goals.

Senate Democrats note that FHLBank Boston CEO Timothy Barrett received $3.1 million in compensation last year while the bank contributed just $2 million to its affordable housing program.

FHFA’s recent decision to waive loan-level price adjustments for the low-income financing programs of the GSEs means that borrowers can sometimes get lower interest rates through HomeReady and Home Possible than they can using traditional GSE financing.