STONE MOUNTAIN, Ga.–The president of the Federal Home Loan Bank of San Francisco offered an update on the activities of the FHLBs, especially to boost home ownership, to attendees at the African American Credit Union Coalition’s annual meeting here.
The FHLBs are 11 regional banks that were created in 1932 and are cooperatives like credit unions, Teresa Bryce Bazemore said.
“Like credit unions our members are our shareholders and our customers,” said Bryce Bazemore.
The FHLB-San Francisco serves Arizona, California and Nevada and has 327 members, close to half of which are credit unions, and of those 157 CUs, 15 are MDIs.
She said FHLBs have a dual mission:
- Liquidity mission in ensuring viability of the housing market, especially 30-year mortgages
- Expanding access to affordable housing and homeownership and supporting community economic development
Donating Profits
Since 1990, 10% of net profits at FHLBs have been donated to an affordable housing program (HP) for low- and moderate-income individuals. Over the life of the HP in San Francisco, some $1.14 billion has gone to build or rebuild 141,000 units of housing, Bryce Bazemore said.
“Homeownership is key to building strong, stable families, and it is the most effective tool for wealth-building,” said Bryce Bazemore, noting it also provides down payment assistance grants.
The bank also has a new $10 million program for down payment assistance grants to the “missing middle,” for those who are emergency responders, teachers and others with higher income levels but who still struggle with buying a home.
State-Targeted Fund
The bank was also the first in the FHLB system to develop a state-targeted fund for HP to address critical affordable housing fund for Nevada. The Nevada-targeted fund grants have gone to six affordable housing projects in the state.
Economic development programs for underserved communities are also being put in place or seeing increased funding, according to Bryce Bazemore.
Eleven credit unions in the FHLB-San Francisco district have partnered with housing developers as part of its programs, the CEO said, representing $15 million to 38 projects that have 1,400 units for low- and moderate-income families.
An ‘Ongoing Challenge’
“Ensuring people living in low-income communities have the infrastructure and resources they need to participate in a changing economy is an ongoing challenge,” said Bryce Bazemore, citing the FHLB’s AHEAD grants as a program in which some CUs have participated and others should consider, she said.
Support For DEI
Meanwhile, Bryce Bazemore told the meeting, “The FHLB San Francisco shares with all of you today a deep commitment to DEI. These aren’t just the right thing to do, they have become a business imperative.”
She added it has become “critical” to reach an increasingly diverse population.
Why It Matters
According to Bryce Bazemore, the reasons why increasing diversity in lending market matter include:
- By 2050 the majority of the U.S. population will be nonwhite
- In 20 years, Hispanics will be the majority of homebuyers
- $700 billion in loans is being missed by lenders due to not reaching the needs of women
- The Black Homeownership Collaborative estimates there are 3.4 million mortgage-ready Black homeowners, twice the number of current homeowners
Intergenerational Wealth
“Homeownership often generates intergenerational wealth,” said Bryce Bazemore. “Too many Black homeowners have been unable to generate the kind of wealth that has been handed down in white families. Ultimately, we want to change the rules of the road for home ownership and finance.”
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