Ginnie Mae Thursday announced that it will exclude federally insured credit unions and state housing finance agencies (HFAs) from its capital requirements and recognize them as insured depositories regulated by a prudential regulator, providing them parity with banks.
NAFCU previously urged Ginnie Mae to grant credit unions parity with banks by excluding all credit unions from the proposed additional capital requirements imposed on non-depository institutions, specifically in response to the agency’s request for information on its updates to eligibility requirements for single-family mortgage-backed securities.
“These changes to our institution-wide capital requirements accomplish two things – they harmonize our program requirements with standards enforced by other federal entities, and they better reflect the unique financial status of state housing agencies,” said Ginnie Mae President Alanna McCargo. “This is important because credit unions and state housing finance agencies play critical roles in supporting community-based lending, particularly in underserved areas.”
Of note, NAFCU mentioned that a credit union that uses the NCUA’s complex credit union leverage ratio to demonstrate risk-based capital adequacy and offers Federal Housing Administration loans or Veterans Affairs loans may be dissuaded from considering becoming a Ginnie Mae issuer due to the proposed capital requirements.
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