WASHINGTON BUREAU — Insurers are trying to keep the Federal Housing Finance Agency from shutting a lending window on their fingers.
The Federal Housing Finance Agency (FHFA) – the agency that now oversees the Federal Home Loan Banks – is considering a proposal to eliminate or reduce insurer access to the system’s liquidity resources.
The FHFA asked in December 2010 whether insurer members of the system should be subject to a requirement that at least 10% of their assets be in residential mortgage loans or whether some alternative residential mortgage investment requirement should be applied to insurers.
The FHFA has received a total of about 65 comments on the proposal in all, with most coming from banking groups.
Five large insurance industry trade groups -the American Council of Life Insurers, Washington; the American Insurance Association, Washington; the Financial Services Roundtable, Washington; the National Association of Mutual Insurance Companies, Indianapolis; and the Property Casualty Insurers Association of America, Des Plaines, Ill. — have written a joint comment letter opposing the proposal.
Several other insurers and reinsurers also have written to express concerns about the proposal.