WASHINGTON - To implement the new financial reform law, the government issued a rule Wednesday making it easier for small banks to borrow money from a Federal Home Loan bank.

Previously, to join the Home Loan Bank System, a bank had to have at least 10% of its assets in residential mortgage loans. The Gramm-Leach-Bliley Act of 1999 eliminated that requirement for banks with less than $500 million of assets. This is expected to prompt as many as 1,000 small banks to join the system and begin borrowing as a way to increase their funding options.

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