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U.S. FHFA wants bank co-op members to stay in mortgage business

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WASHINGTON, Sept 2 (Reuters) - A U.S. regulator proposed new rules on Tuesday aimed at keeping members of government-sponsored banking cooperatives from drifting out of the mortgage business.

The Federal Housing Finance Agency's proposal, now subject to public comment, would require that members of the nation's 12 Federal Home Loan Banks (FHLB) maintain at least 1 percent of their assets in home mortgage loans.

Currently, they only need to meet this requirement when applying for membership in the FHLB, which helps smaller community banks and other financial institutions to access lower cost financing for their mortgage businesses.

For more details on the FHFA proposal, please click on the following link:

https://www.fhfa.gov/SupervisionRegulation/Rules/RuleDocuments/Members_of_Federal_Home_Loan_Banks_Rule_2014.pdf (Reporting by Jason Lange; Editing by David Gregorio)