64718 Federal Register / Vol. 65, No. 210 / Monday, October 30, 2000 / Notices

Total Estimated Burden Hours: 3,000.

Status: Reinstatement, with change.

Authority: Section 3507 of the Paperwork

Reduction Act of 1995, 44 U.S.C. 35, as

amended.

Dated: October 24, 2000

Wayne Eddins,

Departmental Reports Management Officer,

Office of the Chief Information Officer.

[FR Doc. 00–27710 Filed 10–27–00; 8:45 am]

BILLING CODE 4210–01–M

DEPARTMENT OF HOUSING AND

URBAN DEVELOPMENT

Office of Federal Housing Enterprise

Oversight

Solicitation of Public Comments on

Systemic Risk

AGENCY: Office of Federal Housing

Enterprise Oversight, HUD.

ACTION: Solicitation of public comments.

SUMMARY: The Office of Federal Housing

Enterprise Oversight (OFHEO) is

soliciting comments on systemic risk.

To fulfill its supervisory

responsibilities, OFHEO has initiated a

comprehensive study of the risks the

Federal National Mortgage Association

(Fannie Mae) and the Federal Home

Loan Mortgage Corporation (Freddie

Mac) may pose to the financial system

in general and to U.S. housing finance

markets in particular. The study will

examine the nature and magnitude of

any risks posed by the Enterprises,

whether and to what extent Fannie Mae

and Freddie Mac contribute to or

mitigate systemic risk, and actions that

OFHEO and others could take to limit

any systemic risk the Enterprises may

pose. The purpose of this notice is to

solicit public comment on specific

research questions that the study may

address.

DATES: Written comments regarding

systemic risk due by December 29, 2000.

ADDRESSES: Send written comments to

Robert S. Seiler, Jr., Manager of Policy

Analysis, Office of Federal Housing

Enterprise Oversight, 1700 G Street,

N.W., Fourth Floor, Washington, D.C.

20552. Written comments may also be

sent by electronic mail to

sysrisk@ofheo.gov.

FOR FURTHER INFORMATION CONTACT:

Robert S. Seiler, Jr., Manager of Policy

Analysis, Office of Federal Housing

Enterprise Oversight, 1700 G Street,

N.W., Fourth Floor, Washington, D.C.

20552, telephone (202) 414–3785 (a toll

free number). The telephone number for

the Telecommunications Device for the

Deaf is: (800) 877–8339.

Background

In 1992 the Congress created the

Office of Federal Housing Enterprise

Oversight (OFHEO) as an independent

office within the Department of Housing

and Urban Development (HUD) to

ensure that the Federal National

Mortgage Association (Fannie Mae) and

the Federal Home Loan Mortgage

Corporation (Freddie Mac) are

adequately capitalized and operating

safely. OFHEO’s mission is to promote

housing and a strong economy by

ensuring the safety and soundness of the

Enterprises and fostering the strength

and vitality of the nation’s housing

finance system. In fulfilling that

mission, OFHEO imposes capital

requirements on Fannie Mae and

Freddie Mac, conducts annual

examinations of each Enterprise, and

engages in a broad research program.

OFHEO’s research focuses on the

markets in which Fannie Mae and

Freddie Mac operate, the risks the

Enterprises face, the economic effects of

their activities, and any risks they may

pose to other participants in mortgage

and financial markets.

Financial firms that have large

amounts of liabilities or other financial

obligations pose risks to other financial

market participants. Default by a large

financial firm affects their

counterparties directly (by imposing

losses on them) and may affect other

financial firms indirectly (by leading

markets to increase their financing

costs, reduce their access to credit, or

lower the market values of their assets).

With respect to direct costs, firms with

sufficiently large credit exposures to a

large firm that fails may be rendered

insolvent by that failure if their losses

are sufficiently high. With respect to

indirect costs, the default of a large

financial firm may lead to temporary

distortions in financial markets that may

cause other firms to experience liquidity

and even solvency problems. Such

problems may also be caused by a loss

of investor confidence, should investors

believe that such firms have risk

exposures similar to those that caused

the large firm to default. Solvency and

liquidity problems induced by the

default of a large financial firm may also

adversely affect the functioning of

national or international systems for

clearing and settling financial

transactions, further distorting financial

markets.

Fannie Mae and Freddie Mac have

financed over forty percent of

conventional single-family mortgages

outstanding in the U.S. and are among

the largest financial firms in the nation.

To date, OFHEO has consistently

classified the Enterprises as adequately

capitalized pursuant to applicable

minimum capital requirements, and

OFHEO’s examinations have found the

Enterprises to be financially sound and

well managed. However, despite the

current financial health of Fannie Mae

and Freddie Mac, unexpected economic

shocks, failures of Enterprise

management or operations, or other

factors could at some point cause either

Enterprise to fail to meet OFHEO’s

safety and soundness standards. The

pace at which the Enterprises are

growing and their increasingly central

role in mortgage and financial markets

raise the issue of whether, if either

Enterprise experienced severe financial

distress or failed, the functioning of the

financial system in general, or of U.S.

housing finance markets in particular,

could be disrupted to such an extent

that the U.S. or international economies

would be adversely affected. Financial

difficulties at Fannie Mae or Freddie

Mac could be caused by disruptions at

other financial firms.

To fulfill its supervisory

responsibilities, OFHEO has initiated a

comprehensive study of the risks Fannie

Mae and Freddie Mac may pose to the

financial system in general and to U.S.

housing finance markets in particular.

The study will examine the nature and

magnitude of any risks posed by the

Enterprises, whether and to what extent

Fannie Mae and Freddie Mac contribute

to or mitigate systemic risk, and actions

that OFHEO and others could take to

limit any systemic risk the Enterprises

may pose. The study will help OFHEO

enhance its oversight of Fannie Mae and

Freddie Mac and improve OFHEO’s

ability to contribute to Federal

regulation of financial institutions and

markets more generally.

By systemic risk, OFHEO means the

possibility that the direct or indirect

effects of the failure of a large financial

firm would cause distortions or

disruptions in the financial system

significant enough to have a substantial

effect on real output and employment.

An event that caused changes in asset

values—even substantial losses in

values—would not rise to a systemic

threat if it was not expected to induce

a loss in employment or economic

output.

Questions on Which OFHEO Seeks

Public Comment

OFHEO has identified a number of

specific research questions that its study

may address. The purpose of this notice

is to solicit public comment on those

questions, as well as any other topics

that respondents believe OFHEO should

examine in analyzing the risks posed by

Federal Register / Vol. 65, No. 210 / Monday, October 30, 2000 / Notices 64719

Fannie Mae and Freddie Mac and

actions that could reduce those risks.

The questions fall into three broad

areas: Whether and to what extent

Fannie Mae and Freddie Mac pose risks

to the financial system and U.S. housing

finance markets, including systemic

risk; how Federal sponsorship and

regulation of the Enterprises affects any

risks they pose; and the costs and

benefits of possible actions to reduce

those risks and, especially, any systemic

risk Fannie Mae and Freddie Mac may

pose. OFHEO encourages potential

respondents to this notice to present

their views, provide analysis, or suggest

research methodology for some or all of

the questions.

Whether and to What Extent Fannie

Mae and Freddie Mac Pose Risks to the

Financial System and U.S. Housing

Finance Markets

1. Do Fannie Mae and Freddie Mac

pose systemic risk, as defined above, to

the U.S. and international financial

systems? If so, how? How does any

systemic risk posed by the Enterprises

compare, in magnitude and character, to

that posed by other large financial firms

such as large, complex banking

organizations (LCBOs)?

2. Do the activities of Fannie Mae and

Freddie Mac reduce the systemic risk of

the U.S. and international financial

systems? If so, how?

3. Can the risks the Enterprises pose

to the financial system in general and

U.S. housing finance markets in

particular, and any systemic risk they

may pose, be quantified meaningfully?

If so, how?

4. If Fannie Mae or Freddie Mac

defaulted, how severe would losses on

that Enterprise’s obligations have to be

to render other financial firms

undercapitalized or insolvent? How

many firms could experience such

solvency problems? How does the risk

of solvency problems vary for different

types of firms, e.g., federally insured

depository institutions, securities firms,

major derivatives dealers, other

Government-sponsored enterprises

(GSEs), and pension and retirement

funds? How does that risk vary for firms

of different size? How severe might such

solvency problems be? How might such

problems affect the functioning of the

financial system?

5. If Fannie Mae or Freddie Mac

experienced severe financial distress or

failed, how many other financial firms

could experience liquidity problems?

How would such liquidity problems

differ for different types of firms, e.g.,

federally insured depository

institutions, securities firms, major

derivatives dealers, other GSEs, and

pension and retirement funds? How

does that risk vary for firms of different

size? How severe might such liquidity

problems be? How might such problems

affect the functioning of the financial

system?

6. If Fannie Mae or Freddie Mac failed

or significantly curtailed its activities,

how would liquidity in U.S. mortgage

markets be affected? Would the other

Enterprise or the rest of the industry be

able to effectively fill the void? What

would be the likely effects on the

supply and price of mortgage credit?

What would be the likely effects on

economic activity in the housing sector?

How might prospective homebuyers be

affected?

7. What is the risk that solvency or

liquidity problems at financial firms

caused by severe financial distress at or

default by either Enterprise could be

serious enough to reduce employment

or economic output or hamper the

achievement of the goals of federal

housing policy?

8. Fannie Mae and Freddie Mac are

major participants in national and

international systems for clearing and

settling financial transactions. What

risks do the Enterprises pose to such

systems?

9. The outstanding debt of Fannie

Mae and Freddie Mac has grown at an

annual average rate of nearly 24 percent

since year-end 1992. If debt issued by

the Enterprises continued to grow

substantially faster than most other

types of credit market instruments, how

would any risks Fannie Mae and

Freddie Mac pose to the financial

system as a whole, and U.S. housing

finance markets in particular, be

affected? How would those risks be

affected if debt issued by the Enterprises

and other GSEs replaced Treasury

securities as a benchmark in financial

markets?

10. How independent are the risks

posed by Fannie Mae and Freddie Mac?

The Effect of Federal Sponsorship and

Regulation on the Risks Posed by the

Enterprises

11. What are the implications for the

risks Fannie Mae and Freddie Mac pose

to the financial system in general and

U.S. housing finance markets in

particular of the fact that investors in

the Enterprises’ obligations believe the

federal government would act to protect

them in the event either Enterprise

failed?

12. Is there uncertainty about the

actions the federal government would

take in the event either Enterprise

experienced severe financial distress?

Does any such uncertainty affect the

risks posed by Fannie Mae or Freddie

Mac?

13. How does current federal

regulation of Fannie Mae and Freddie

Mac affect any systemic risk posed by

the Enterprises?

Actions to Reduce Risks Posed by

Fannie Mae and Freddie Mac

14. What steps could be taken to

reduce the risk that a default by Fannie

Mae or Freddie Mac would cause other

financial firms to experience solvency

or liquidity problems? What are the

potential costs and benefits of those

options?

15. What steps could be taken to

reduce the risk of the Enterprises

developing liquidity problems if either

of them experienced severe financial

distress? What are the potential costs

and benefits of those options?

16. In addition to OFHEO’s capital

regulation and examinations of Fannie

Mae and Freddie Mac, what steps can

OFHEO or other appropriate entities

take to reduce any risks the Enterprises

may pose to clearing and settlement

systems? What are the potential costs

and benefits of those options?

17. In what areas could increased

transparency and public disclosure by

Fannie Mae and Freddie Mac reduce the

risks they pose to the financial system

in general and U.S. housing finance

markets in particular? What specific

information would be most valuable to

market participants?

18. Could increased market discipline

of Fannie Mae and Freddie Mac reduce

the risks they pose to the financial

system in general and U.S. housing

finance markets in particular? If so,

how? What specific actions could be

taken to increase market discipline of

the Enterprises? Could increased market

discipline increase the risks Fannie Mae

and Freddie Mac pose?

19. Should OFHEO’s approach to

regulating the Enterprises be adapted to

reflect the risks Fannie Mae and Freddie

Mac pose to the financial system in

general and U.S. housing finance

markets in particular? If so, how?

20. Should OFHEO’s statutory

authority be adapted to reflect the risk

Fannie Mae and Freddie Mac pose to

the financial system in general and U.S.

housing finance markets in particular? If

so, how?

OFHEO invites respondents to

provide their analyses and views of any

other issues related to the risks posed by

Fannie Mae and Freddie Mac that they

believe OFHEO should consider.

64720 Federal Register / Vol. 65, No. 210 / Monday, October 30, 2000 / Notices

Dated: October 25, 2000.

Armando Falcon, Jr.,

Director, Office of Federal Housing Enterprise

Oversight.

[FR Doc. 00–27812 Filed 10–27–00; 8:45 am]

BILLING CODE 4220–01–U

DEPARTMENT OF THE INTERIOR

Bureau of Land Management; Alaska

[AK–962–1410–HY–P, F–14909–A, F–14909–

A2, F–19148–38]

Alaska Native Claims Selection; Notice

for Publication

In accordance with Departmental

regulation 43 CFR 2650.7(d), notice is

hereby given that a decision to issue

conveyance under the provisions of Sec.

14(a) of the Alaska Native Claims

Settlement Act of December 18, 1971, 43

U.S.C. 1613(a), will be issued to

Kuukpik, Corporation for approximately

15,987 acres. The corresponding

subsurface estate will be conveyed to

Arctic Slope Regional Corporation

pursuant to Sec. 1431(o) of the Alaska

National Interest Lands Conservation

Act of December 2, 1980, Pub. L. 96–

487, 94 Stat. 2533. The lands involved

are in the vicinity of Nuiqsut, Alaska,

within the following townships:

Umiat Meridian, Alaska

T. 11 N., R. 3 E.

T. 10 N., R. 4 E.

T. 11 N., R. 4 E.

A notice of this decision will be

published once a week, for four (4)

consecutive weeks, in the Arctic

Sounder. Copies of the decision may be

obtained by contacting the Alaska State

Office of the Bureau of Land

Management, 222 West Seventh

Avenue, #13, Anchorage, Alaska 99513–

7599 ((907) 271–5960).

Any party claiming a property interest

which is adversely affected by the

decision, an agency of the Federal

government, or regional corporation,

shall have until November 29, 2000 to

file an appeal. However, parties

receiving service by certified mail shall

have 30 days from the date of receipt to

file an appeal. Appeals must be filed in

the Bureau of Land Management at the

address identified above, where the

requirements for filing an appeal may be

obtained. Parties who do not file an

appeal in accordance with the

requirements of 43 CFR part 4, Subpart

E, shall be deemed to have waived their

rights.

Nancy Larsen,

Land Law Examiner, Branch of ANCSA

Adjudication.

[FR Doc. 00–27730 Filed 10–27–00; 8:45 am]

BILLING CODE 4310–JA–P

DEPARTMENT OF THE INTERIOR

Bureau of Land Management

[CO–01–600–1310–241A]

Northwest Colorado Resource

Advisory Council Meeting

AGENCY: Bureau of Land Management,

Interior.

ACTION: Notice of Meeting.

SUMMARY: The next meeting of the

Northwest Colorado Resource Advisory

Council will be held on Thursday,

November 16, 2000, at the Holiday Inn,

Moffat Room in Craig, Colorado.

DATES: Thursday, November 16, 2000.

ADDRESSES: For further information,

contact Lynn Barclay, Bureau of Land

Management (BLM), 455 Emerson

Street, Craig, Colorado 81625;

Telephone (970) 826–5096.

SUPPLEMENTARY INFORMATION: The

Northwest Resource Advisory Council

(RAC) will meet on Thursday,

November 16, 2000, at the Holiday Inn

in the Moffat Room, Highway 13, Craig,

Colorado. The meeting will start at 9

a.m. and includes discussion of reports

from the Weed, Wildlife, Fire, and

United States Forest Service Advisory

committees. Information will be

presented concerning joint training for

the Colorado RAC’s and the

Communication Policy committee will

present their proposal.

The meeting is open to the public.

Interested persons may make oral

statements at the meetings or submit

written statements at the meeting. Perperson time limits for oral statements

may be set to allow all interested

persons an opportunity to speak.

Summary minutes of council

meetings are maintained at the Bureau

of Land Management Offices in Craig

and Grand Junction, Colorado. They are

available for public inspection and

reproduction during regular business

hours within thirty (30) days following

the meeting.

Dated: October 24, 2000.

Richard Arcand,

Acting Center Manager, Northwest Center.

[FR Doc. 00–27754 Filed 10–27–00; 8:45 am]

BILLING CODE 4310–JB–P

DEPARTMENT OF THE INTERIOR

Bureau of Land Management

[NM–070–01–1430–EU; NMNM102991,

NMNM102992]

A Plan Amendment/Environmental

Assessment To Resolve Two

Occupancy Trespasses in San Juan

County, NM

AGENCY: Bureau of Land Management,

Interior.

ACTION: Notice of Intent to Prepare a

Proposed Resource Plan Amendment.

SUMMARY: Notice is hereby given that

the Bureau of Land Management (BLM),

Farmington Field Office (FFO) is

proposing an amendment to the

Farmington Resource Management Plan

(RMP) (July 1988). The amendment

would amend the plan to allow disposal

of public land in FFO’s retention zone.

This would then make public land

available to resolve two occupancy

trespasses by direct sale of the tracts of

public land to the unauthorized users

pursuant to Section 203 of the Federal

Land Policy and Management Act of

1976 (43 U.S.C. 1713), as amended. The

trespasses are located on the following

public lands:

New Mexico Principal Meridian

T. 29 N., R. 11 W.

Sec. 3, lot 6 (portion of

N1⁄2NW1⁄4NW1⁄4SW1⁄4NE1⁄4)

Containing 0.59 acres, more or less.

T. 31 N., R. 11 W.

Sec. 34, SE1⁄4 SE1⁄4 SE1⁄4 SW1⁄4 NW1⁄4

Containing 0.625 acres, more or less.

DATES: Written scoping comments must

be submitted on or before November 30,

2000.

ADDRESSES: Comments should be

addressed to the Field Manager, Bureau

of Land Management, Farmington Field

Office, 1235 La Plata Highway, Suite A,

Farmington, NM 87401.

FOR FURTHER INFORMATION CONTACT:

Jerrold E. Crockford at the address above

or at (505) 599–6333.

SUPPLEMENTARY INFORMATION:

Description of Proposed Planning

Action: The RMP provides for three

land ownership adjustment zones—

acquisition, rentention, and exchange.

Of these three zones, sale of public land

is not authorized within the acquisition

zone. Sales are limited to specifically

identified parcels (July 1988) within the

retention zone, and authorized in the

exchange zone. The proposed

amendment would make two public

lands listed above available to sell by

direct sale to resolve two cases of

occupancy trespass in BLM FFO’s

retention zone.