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[Federal Register Volume 62, Number 238 (Thursday, December 11, 1997)]
[Rules and Regulations]
[Pages 65197-65198]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-32207]

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FEDERAL HOUSING FINANCE BOARD

12 CFR Part 934

[No. 97-77]
RIN 3069-AA70

Authority To Approve Federal Home Loan Bank Bylaws

AGENCY: Federal Housing Finance Board.

ACTION: Interim final rule with request for comments.

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SUMMARY: The Federal Housing Finance Board (Finance Board) is adding a 
new provision to its regulation on Federal Home Loan Bank (FHLBank) 
operations to devolve responsibility for approving FHLBank bylaws or 
amendments thereto, subject to certain conditions, from the Finance 
Board to the boards of directors of the FHLBanks. The rule is part of 
the Finance Board's continuing effort to devolve management and 
governance responsibilities to the FHLBanks and is consistent with the 
goals of the Regulatory Reinvention Initiative of the National 
Performance Review.

DATES: The interim final rule will become effective on January 12, 
1998. The Finance Board will accept comments on the interim final rule 
in writing on or before January 12, 1998.

ADDRESSES: Mail comments to Elaine L. Baker, Secretary to the Board, 
Federal Housing Finance Board, 1777 F Street, N.W., Washington, D.C. 
20006. Comments will be available for public inspection at this 
address.

FOR FURTHER INFORMATION CONTACT: Amy R. Maxwell, Compliance Assistance 
Division, Office of Policy, 202/408-2882, or Janice A. Kaye, Attorney-
Advisor, Office of General Counsel, 202/408-2505, Federal Housing 
Finance Board, 1777 F Street, N.W., Washington, D.C. 20006.

[[Page 65198]]

SUPPLEMENTARY INFORMATION:

I. Statutory and Regulatory Background

    Subject to the approval of the Finance Board, section 12(a) of the 
Federal Home Loan Bank Act (Bank Act) authorizes the board of directors 
of each FHLBank to ``prescribe, amend, and repeal by-laws, rules, and 
regulations governing the manner in which its affairs may be 
administered.'' 12 U.S.C. 1432(a). Currently, no Finance Board 
regulation or policy addresses specifically the process by which the 
Finance Board evaluates and approves FHLBank bylaws or amendments 
thereto.
    From the establishment of the Finance Board in 1989 until the 
present, Finance Board staff has reviewed proposed FHLBank bylaws and 
bylaws amendments to ensure that they are consistent with applicable 
statutes, regulations, and Finance Board policies. Pursuant to 
delegated authority, the Associate Director of the former District 
Banks Secretariat, and, after that position and office were eliminated, 
the Managing Director of the Finance Board, approved FHLBank bylaws or 
bylaws amendments upon the recommendation of staff. See Federal Home 
Loan Bank Board Resolution No. 21,526 (Apr. 4, 1968) (rescinded by 
Finance Board Resolution No. 97-76 (Dec. 1, 1997)); Finance Board 
Chairperson's Order No. 95-OR-6 (Oct. 10, 1995).
    The Finance Board believes the FHLBanks should have broad 
discretion to manage their affairs, including the authority to approve 
bylaws and amendments thereto. Accordingly, as part of the Finance 
Board's continuing effort to devolve management and governance 
responsibilities to the FHLBanks, the interim final rule transfers the 
authority to approve FHLBank bylaws and bylaws amendments, subject to 
certain conditions, from the Finance Board to the boards of directors 
of the FHLBanks.

II. Analysis of the Interim Final Rule

    The Finance Board is proposing to add a new section, designated as 
Sec. 934.16, to its regulation on FHLBank operations. Section 934.16 
devolves responsibility for approving FHLBank bylaws and amendments 
thereto, subject to certain conditions, from the Finance Board to the 
boards of directors of the FHLBanks. The rule authorizes the board of 
directors of each FHLBank to prescribe, amend, or repeal bylaws 
governing the manner in which the FHLBank administers its affairs 
without the prior approval of the Finance Board provided that the 
bylaws or bylaws amendments are consistent with applicable statutes, 
regulations, and Finance Board policies. The Finance Board will ensure 
that FHLBank bylaws are legally unobjectionable through the examination 
process.

III. Notice and Public Participation

    The Finance Board finds that the notice and comment procedure 
required by the Administrative Procedure Act is unnecessary, 
impracticable, and contrary to the public interest in this instance 
because the change made by the interim final rule is technical in 
nature and applies only to the FHLBanks. See 5 U.S.C. 553(b)(3)(B). 
Nevertheless, because the Finance Board believes public comments aid in 
effective rulemaking, it will accept written comments on the interim 
final rule on or before January 12, 1998.

IV. Regulatory Flexibility Act

    The Finance Board is adopting this amendment to part 934 in the 
form of an interim final rule and not as a proposed rule. Therefore, 
the provisions of the Regulatory Flexibility Act do not apply. See 5 
U.S.C. 601(2), 603(a).

V. Paperwork Reduction Act

    This interim final rule does not contain any collections of 
information pursuant to the Paperwork Reduction Act of 1995. See 44 
U.S.C. 3501 et seq. Consequently, the Finance Board has not submitted 
any information to the Office of Management and Budget for review.

List of Subjects in 12 CFR Part 934

    Federal home loan banks, Securities, Surety bonds.

    Accordingly, the Federal Housing Finance Board hereby amends part 
934, chapter IX, title 12 of the Code of Federal Regulations as 
follows:

PART 934--OPERATIONS OF THE BANKS

    1. Revise the authority citation for part 934 to read as follows:

    Authority: 12 U.S.C. 1422a, 1422b, 1431(g), 1432(a), and 1442.

    2. Add Sec. 934.16 to read as follows:

Sec. 934.16  Approval of Bank bylaws.

    The board of directors of a Bank may prescribe, amend, or repeal 
bylaws governing the manner in which the Bank administers its affairs 
without the Board's prior approval provided that the bylaws or 
amendments are consistent with applicable statutes, regulations, and 
Board policies.

    Dated: December 3, 1997.

    By the Board of Directors of the Federal Housing Finance Board.
Bruce A. Morrison,
Chairperson.
[FR Doc. 97-32207 Filed 12-10-97; 8:45 am]
BILLING CODE 6725-01-U
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