based capital: Correction,

[Federal Register: April 19, 2002 (Volume 67, Number 76)]

[Rules and Regulations]

[Page 19321-19322]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr19ap02-2]

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of Federal Housing Enterprise Oversight

12 CFR Part 1750

Risk-Based Capital

AGENCY: Office of Federal Housing Enterprise Oversight, HUD.

ACTION: Correcting amendments.

SUMMARY: This document contains corrections to Part 1750 of the Code of Federal Regulations for the regulation on the process used to determine the capital classification of the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal National Mortgage Association (Fannie Mae).

EFFECTIVE DATE: April 19, 2002.

[[Page 19322]]

FOR FURTHER INFORMATION CONTACT: Marvin L. Shaw, Senior Counsel, telephone (202) 414-3751 (not a toll-free number), Office of Federal Housing Enterprise Oversight, Fourth Floor, 1700 G Street, NW., Washington, DC 20552. The telephone number for the Telecommunications Device for the Deaf is (800) 877-8339.

SUPPLEMENTARY INFORMATION:

Background

OFHEO published a final regulation setting forth a risk-based capital stress test on September 13, 2001, which formed the basis for determining the risk-based capital requirement for the Federally sponsored housing enterprises--Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac) (collectively, the Enterprises).\1\ Subsequently, OFHEO published a final regulation that referenced the risk-based capital regulation with respect to the capital classification process.\2\ There are two errors in the Code of Federal Regulations that need to be corrected: one section needs to be removed and a second section needs to be revised to reflect the appropriate cross reference.

\1\ Risk-based Capital, 66 FR 47730 (September 13, 2001).

\2\ Prompt Supervisory Response and Corrective Action, 67 FR 3587 (January 25, 2002).

Need for Correction

As published, the final regulations contained an error which may be confusing and therefore needs to be corrected.

List of Subjects in 12 CFR Part 1750

Capital classification, Mortgages, Risk-based capital.

Accordingly, 12 CFR part 1750 is corrected by making the following correcting amendments:

PART 1750--CAPITAL

1. The authority citation for part 1750 continues to read as follows:

   Authority: 12 U.S.C. 4513, 4514, 4611, 4612, 4614, 4618.

   Sec. 1750.5 [Removed].

2. Remove Sec. 1750.5 of subpart A.

3. Revise paragraph (c) of Sec. 1750.12 to read as follows:

   Sec. 1750.12 Procedure and timing.

   * * * * *

   (c) When an Enterprise contemplates entering a new activity, as the term is defined in section 3.11 of Appendix A to this subpart, the Enterprise shall notify the Director as soon as possible while the transaction or activity is under consideration, but in no event later than 5 calendar days after settlement or closing. The Enterprises shall provide to the Director such information regarding the activity as the Director may require to determine a stress test treatment. OFHEO will inform the Enterprise as soon as possible thereafter of the proposed stress test treatment of the new activity. In addition, the notice of proposed capital classification required by Sec. 1777.21 of this chapter will inform the Enterprise of the capital treatment of such new activity used in the determination of the risk-based capital requirement. * * * * *

   Dated: April 15, 2002. Armando Falcon, Jr., Director, Office of Federal Housing Enterprise Oversight.

   [FR Doc. 02-9608Filed4-18-02; 8:45 am]

   BILLING CODE 4220-01-U