granted to a Federal Home Loan Bank by any 
captive insurance company, or by its parent 
company or any affiliate company on its behalf, 
shall be entitled to priority over the claims and 
rights of any party (including any receiver, con-
servator, trustee, or similar party having rights 
of a lien creditor) other than claims and rights 
that— 
‘‘(i) would be entitled to priority 
under otherwise applicable law; and 
‘‘(ii) are held by actual bona fide pur-
chasers for value or by actual secured par-
ties that are secured by actual perfected 
security interests.’’. 
(b) RULEMAKING.—Not later than the end of the 1- 
year period beginning on the date of enactment of this 
Act, the Director of the Federal Housing Finance Agency 
shall issue the capital standards and reporting require-
ments rules described under subparagraphs (A)(ii) and 
(B)(ii)(IV) of section 4(a)(6) of the Federal Home Loan 
Bank Act. 
(c) APPLICABILITY.—Section 4(a)(6) of the Federal 
Home Loan Bank Act, as added by subsection (a), shall 
take effect with respect to a captive insurance company 
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on the effective date of the rules required under subsection 
(b). 
(d) CAPTIVE
INSURANCE
COMPANY
ELIGIBILITY 
TRANSITION PERIOD.—A captive insurance company that 
has, or will have, the company’s membership in a Federal 
Home Loan Bank terminated due solely to the change in 
the treatment of captive insurance companies under the 
final rule of the Federal Housing Finance Agency titled 
‘‘Members of Federal Home Loan Banks’’ (81 Fed. Reg. 
3246; published January 20, 2016) may continue mem-
bership or have membership restored, as applicable, in the 
same Federal Home Loan Bank during the period begin-
ning on the date of enactment of this Act and ending on 
the day the Director issues the rules required under sub-
section (b), if— 
(1) the Federal Home Loan Bank determines, 
including based on information submitted by the 
captive insurance company, that— 
(A) the affiliate insured by the captive in-
surance company makes, owns, or acquires resi-
dential mortgage loans; and 
(B) the captive insurance company will 
comply with the membership eligibility require-
ments described in paragraphs (a), (b), and (c) 
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of section 1263.6 of title 12, Code of Federal 
Regulations, during such period; and 
(2) the captive insurance company continues to 
be owned, or upon restoration of membership is 
owned and continues to be owned, including direct 
ownership by a controlling entity or indirect owner-
ship through one or more holding companies, by the 
same entity that owned the captive insurance com-
pany on the date of enactment of this subsection. 
SEC. 4. STUDY ON IMPACT OF EXPANSION OF MEMBER-
SHIP. 
(a) STUDY.—The Director of the Federal Housing 
Finance Agency shall conduct a study on the impact of 
the expansion of the Federal Home Loan Bank System 
to additional types of entities involved in the housing fi-
nance system. The study shall consider— 
(1) how liquidity provided through the Federal 
Home Loan Bank System could be increased in a 
manner that is consistent with its mission; 
(2) what initial and ongoing capital and report-
ing requirements for membership could be used to 
minimize risk to the Federal Home Loan Bank Sys-
tem; 
(3) how the Federal Housing Finance Agency 
could use its oversight and authority to ensure that 
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expanded membership would not pose excessive risk 
to the Federal Home Loan Bank System; 
(4) mitigants and transaction structures to ad-
dress risk of an insolvency proceeding affecting the 
parent of a captive insurance company member; and 
(5) other topics relevant to developing a frame-
work for membership that promotes the mission of 
the Federal Home Loan Bank System. 
(b) REPORT.—Not later than one year after the date 
of enactment of this Act, the Director shall submit to the 
Committee on Banking, Housing, and Urban Affairs of 
the Senate and the Committee on Financial Services of 
the House of Representatives a report on the study re-
quired under subsection (a), including all findings and de-
terminations made in carrying out the study. 
Æ 
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