FHFA Could Enhance Its Supervision of the Federal Home Loan Banks by Incorporating Lessons Learned from the Spring 2023 Bank Failures

Date Issued

Monday, August 19, 2024

Submitting OIG

Federal Housing Finance Agency OIG

Other Participating OIGs

Federal Housing Finance Agency OIG

Agencies Reviewed/Investigated

Federal Housing Finance Agency

Report Number

EVL-2024-003

Report Type

Inspection / Evaluation

Agency Wide

Yes

Number of Recommendations

Questioned Costs

Funds for Better Use

Open Recommendations

This report has 4 open recommendations.

Recommendation Number	Significant Recommendation	Recommended Questioned Costs	Recommended Funds for Better Use
EVL-2024-003-1	No	$0	$0
The Division of Federal Home Loan Bank Regulation should issue written guidance on the FHLBanks’ collateral subordination practices.
EVL-2024-003-2	No	$0	$0
The Division of Federal Home Loan Bank Regulation should complete the development and implementation of protocols for DBR personnel to follow in times of member distress and failure, including heightened oversight of the FHLBanks and coordination of communication and actions with the appropriate federal and state regulators.
EVL-2024-003-3	No	$0	$0
FHFA should update the Examination Manual’s Credit Risk Management module and Advances and Collateral module to include guidance on the review of topics and issues related to the Spring 2023 bank failures and otherwise incorporate lessons learned from the 2023 examinations of member credit risk management.
EVL-2024-003-4	No	$0	$0
The Division of Federal Home Loan Bank Regulation should adopt a process to ensure the appropriate examination coverage of all topics within its Examination Manual guidance.