##ure, finding a particularly important role for declining house prices ( gerardi, shapiro, and willen, 2007 ). the federal reserve bank of philadelphia is conducting a five - year study of pre - purchase homeownership counseling. that study will provide important information on the benefits of counseling services in fostering sustainable homeownership and help us understand the long - term effects of financial - management skills on the credit worthiness of low - and moderate - income homebuyers. in addition to this ongoing research, the federal reserve is supporting efforts to reach troubled borrowers and to raise awareness in communities about ways to prevent foreclosures. since july, the community affairs offices across the federal reserve system have sponsored or cosponsored more than fifty events related to foreclosures, reaching more than 4, 000 attendees including lenders, counselors, community development specialists, and policymakers. there is also work to be done in mitigating the impact of unavoidable foreclosures on consumers and communities. families who cannot sustain homeownership will need to find new places to live, highlighting the critical need for an adequate supply of affordable rental housing. consumers going through foreclosure typically will see their credit scores drop, raising longer - term questions about their ability to rebound financially and perhaps pursue a more sustainable home purchase at some later point. high numbers of foreclosed homes in some communities also raise challenges, and perhaps opportunities. because vacant homes, in particular, impose real costs on neighborhood and communities, forward - looking strategies to keep these homes occupied are important ( apgar and duda, 2005 ). some efforts are underway to prevent vacancies, as well as return vacant properties to active use ; some of these efforts may also help preserve the supply of affordable housing in areas that have experienced shortages. 7 the federal reserve has recently undertaken a joint effort with neighborworks america to help communities develop strategies for neighborhood stabilization. conclusion it is clear that rising home foreclosures and delinquencies significantly challenge many consumers and communities, and i hope i have conveyed today that the federal reserve is strongly committed to fully employing our authority, expertise, and resources to help alleviate their distress. we will continue to collaborate at the national, regional, and local levels with other stakeholders in the public, private, and nonprofit sectors to help to avoid preventable foreclosures and to address the consequences of the foreclosures that occur. in

##making process help inform and influence proposals that are under consideration. if there is a desire to influence change, stakeholders must engage and provide input during this process. second, the large number of finalized, proposed, and potential changes suggest a lack of prioritization - whether we have effectively identified actual risks to the banking system and devoted resources to the most pressing of these issues. prioritization is something i have spoken about at length in the past, and it remains just as critical today. 2 the banking stress last spring revealed the presence of flaws and shortcomings in our bank regulatory and supervisory framework. a lack of prioritization in our approach risks losing focus on making substantively responsive adjustments and reforms. opportunities for engagement reviewing and commenting on regulatory proposals should never be a distraction from a banker's core responsibility to ensure the bank continues serving its customers in a safe and sound manner, and in compliance with applicable laws. so, i do not want any of you to take my remarks today as a call to drop everything you are doing and open up the federal register and start reading. the banking system is a highly regulated environment, and as you see in your work every day, requires banks to devote significant resources to compliance. a strong culture of compliance can help keep your bank safe, and in the aggregate promotes a safe and sound banking system. within a bank, virtually everyone has a role to play in promoting that culture of compliance with applicable law, all while serving your customers. 3 / 9 bis - central bankers'speeches but stakeholders, including bankers, have an important role in the stewardship of the banking system that goes beyond compliance - namely, participating in the administrative rulemaking process. it is critical that you share your views with policymakers on regulatory reform proposals. all the comments, data, and analysis from commenters enable policymakers to make informed decisions throughout the rulemaking process, from the initial brainstorming stage, through the creation of a proposal, and in crafting a final rule. this feedback is equally critical in understanding how the supervisory process is working as it evolves over time and incorporates new standards and expectations. information about the intended and unintended impacts of reform initiatives is especially informative. often, private - sector stakeholders are best positioned to understand and explain these impacts, and to identify gaps in the context, data, and analysis underpinning these initiatives. i recognize that in some instances, multiple, interrelated proposals out for comment at the same time compl