Y 4.F 49/20:108-54 FED - DOCS HEARING BEFORE THE COMMITTEE ON FINANCIAL SERVICES U.S. HOUSE OF REPRESENTATIVES ONE HUNDRED EIGHTH CONGRESS FIRST SESSION SEPTEMBER 25, 2003 Printed for the use of the Committee on Financial Services Serial No. 108-54 DEPOSITORY APR 3 0 2004 STANFORD UNIVERSITY JONSSON LIBRARY U.S. GOVERNMENT PRINTING OFFICE 92-628 PDF WASHINGTON : 2003 For sale by the Superintendent of Documents, U.S. Government Printing Office Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402-0001 HOUSE COMMITTEE ON FINANCIAL SERVICES MICHAEL G. OXLEY, Ohio, Chairman JAMES A. LEACH, Iowa BARNEY FRANK, Massachusetts BERNARD SANDERS, Vermont BOJS O E ROBERT U. FOSTER, III, Staff Director (II) 91 42 Bartlett, Hon. Steve, President and CEO, The Financial Services Roundtable Conine, C. Kent, Conine Residential Group, Inc., on behalf of the National Courson, John, President and CEO, Pacific Mortgage Company, on behalf of the Mortgage Bankers Association of America Falcon, Hon. Armando Jr., Director, Federal Housing Enterprise Oversight Fishbein, Allen, Director of Housing and Credit Policy, Consumer Federation Gould, George D., Director, Freddie Mac cinnati Korsmo, Hon. John T., Chairman, Federal Housing Finance Board Montague, Terri Y., President and Chief Operating Officer, The Enterprise Raines, Franklin D., Chairman and Chief Executive Officer, Fannie Mae cisco Spriggs, William E., Executive Director, National Urban League, Institute Taylor, D. Russell, President and CEO, Rahway Savings Association on behalf 48 44 47 106 108 110 112 114 116 117 119 120 121 122 123 127 139 145 153 163 173 182 191 197 Page Prepared statements Continued Schultz, Dean 229 236 240 246 256 257 ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD Baker, Hon. Richard H.: Financial Services Forum, prepared statement Frank, Hon. Barney: Federal Home Loan Bank of Boston letter, September 24, 2003 Ney, Hon. Robert W.: National Association of Realtors, prepared statement Courson, John: Written response to questions from Hon. Ginny Brown-Waite Falcon, Hon. Armando Jr.: Written response to questions from Hon. Ginny Brown-Waite Gould, George D.: Written response to questions from Hon. Ginny Brown-Waite Written response to questions from Hon. Barney Frank Written response to questions from Hon. Ginny Brown-Waite 261 262 266 268 H.R. 2575—THE SECONDARY Thursday, September 25, 2003 U.S. HOUSE OF REPRESENTATIVES, Washington, D.C. The committee met, pursuant to call, at 10:10 a.m., in Room 2128, Rayburn House Office Building, Hon. Michael Oxley (chairman of the committee) presiding. Present: Representatives Oxley, Leach, Baker, Bachus, Castle, Royce, Lucas of Oklahoma, Ney, Kelly, Paul, Gillmor, Ryun, Ose, Green, Shays, Shadegg, Hart, Tiberi, Kennedy, Feeney, Hensarling, Garrett, Murphy, Brown-Waite, Barrett, Harris, Renzi, Frank, Kanjorski, Waters, Maloney, Carson, Sherman, Meeks, Lee, Inslee, Moore, Gonzalez, Lucas of Kentucky, Clay, Israel, Baca, Matheson, Miller of North Carolina, Scott, and Davis. The CHAIRMAN. [Presiding.] The committee will come to order. Today the Financial Services Committee will hear from the regulators, the regulated, and outside parties interested in the oversight of the housing government-sponsored enterprises. Two weeks ago, Secretaries Snow and Martinez came to the committee with the Administration's proposal to improve regulatory oversight for the GSEs. They proposed developing a world-class regulator with the tools to rigorously supervise the activities of these highly complex financial institutions. The Secretaries called for the regulator to be housed in the Department of the Treasury as an individual office, similar to that of the Office of the Comptroller of the Currency. Additionally the proposal called for the Department of Housing and Urban Development to retain its role as regulator of the GSES mission and to ensure that the agencies meet their affordable housing goals. HUD's expertise in this area is critical. Under the Administration's proposal the Department would receive additional powers to enforce compliance with the housing goals. There is a broad agreement that the current regulatory structure for the GSEs is not operating as effectively as it should. The Office of Federal Housing Enterprise Oversight is underfunded, understaffed and unable to fully oversee the operations of these sophisticated enterprises. This was reflected in the surprise management reorganization by Freddie Mac and by Wall Street reports stating that GSE oversight 52 24954 403 XL 6/04 31150-52 NLE |