Devolution. As part of the Finance Board’s continuing effort to devolve management and governance responsibilities to the FHLBanks, (a) authorizes the FHLBanks to approve or deny all applications for certification as a nonmember mortgagee, subject to the requirements of the Bank Act and Finance Board regulations. Although all six commenters addressing this issue expressly supported devolution of decision making authority to the FHLBanks, one trade association commenter suggested delaying devolution until the FHLBanks have some experience in administering the final rule. Since the basis for the review criteria in the final rule is the standards previously applied by the FHLBanks and the Finance Board, no delay in devolution is required. Four FHLBank commenters requested the authority to delegate application approvals to a committee of the FHLBank’s board of directors, the FHLBank president, or a senior officer who reports directly to the president other than an officer responsible for business development. This would be consistent with the Finance Board’s membership regulation and such authority is included in the final rule. See 12 CFR 933.3(a). Also consistent with the membership regulation, the final rule requires that only the FHLBanks’ board of directors may deny certification as a nonmember mortgagee.
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