WASHINGTON The Federal Home Loan Bank Systems controversial Mortgage Partnership Finance Program more than doubled in size in the second quarter.
The outstanding loan balance jumped 126%, to $10.4 billion, from March 31 to June 30, the Federal Housing Finance Board said in its second-quarter financial report, which was released last Friday.
A $9 billion cap on the program was lifted in late June. However, some lawmakers are threatening to reinstate it. The programs fate should be settled next month, when Congress returns to work.
The Federal Home Loan Bank of Chicago developed the program, which is now offered by nearly all 12 Home Loan banks. Under the program, the lender maintains the credit risk on a loan and the system bank takes on any prepayment and interest rate risk.
During the second quarter the program exploded at two Home Loan banks: the Pittsburgh banks mortgage assets increased 1,048%, to $1.01 billion, and the Dallas banks 381%, to $929 million.
Membership in the Home Loan Bank System increased 2%, to 7,594. Banks continued to dominate, at 5,526, up 3%. The number of credit union members increased 8%, to 441. Four insurance companies became members, bringing that industrys membership to 45. Consolidation trimmed thrift membership by 18, to 1,582.
The $436.6 billion advanced to members in the second quarter was just 8% more than in the first but a third more than in last years the second quarter.
