As Prepared For Delivery on September 25, 2020
Thank you Secretary Mnuchin and thank you to my colleagues on the Council for conducting this important review of the risks associated with the secondary mortgage market and the activities of the Government-Sponsored Enterprises in particular.
This marks the first formal use of the activities-based approach for assessing risks to the financial system and I believe it shows the merits of the new framework adopted by the Council in December 2019.
I am pleased to vote my approval of this statement.
I would like to commend Director Calabria and the FHFA team for their proactive and thoughtful approach to mitigating risks in the secondary mortgage market and ensuring the GSEs have an appropriate capital framework.
A well-functioning secondary mortgage market is essential for credit unions and their members.
The credit union industry holds roughly $500 billion in loans for residential 1-4 family properties. This comprises roughly 44 percent of the industry’s $1.14 trillion in loans outstanding.
Although many credit unions hold mortgage loans on their own books, those seeking to sell these loans will continue to have vital partners in the GSEs due to regulatory framework put in place by FHFA.
I look forward to continuing to monitor and safeguard this crucial segment of the U.S. financial system to better ensure sustainable homeownership for millions of Americans.