Notice of Annual Adjustment of the Cap on Average Total Assets That Defines Community Financial Institutions

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<title>Federal Register, Volume 91 Issue 1 (Friday, January 2, 2026)</title>
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[Federal Register Volume 91, Number 1 (Friday, January 2, 2026)]
[Notices]
[Page 144]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-24208]



[[Page 144]]

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FEDERAL HOUSING FINANCE AGENCY

[No. 2026-N-2]


Notice of Annual Adjustment of the Cap on Average Total Assets 
That Defines Community Financial Institutions

AGENCY: Federal Housing Finance Agency.

ACTION: Notice.

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SUMMARY: The Federal Housing Finance Agency (FHFA) has adjusted the cap 
on average total assets that is used in determining whether a Federal 
Home Loan Bank (Bank) member qualifies as a ``community financial 
institution'' (CFI) to $1,541,000,000, based on the annual percentage 
increase in the Consumer Price Index for all urban consumers (CPI-U), 
as published by the Department of Labor (DOL). This change is effective 
as of January 1, 2026.

FOR FURTHER INFORMATION CONTACT: Janna Bruce, Senior Financial Analyst, 
Division of Federal Home Loan Bank Regulation, (202) 649-3202, 
<a href="/cdn-cgi/l/email-protection#3278535c5c531c704047515772545a54531c555d44"><span class="__cf_email__" data-cfemail="2c664d42424d026e5e594f496c4a444a4d024b435a">[email&#160;protected]</span></a>; or RG Yamba, Counsel, Office of General Counsel, 
(202) 649-3399, <a href="/cdn-cgi/l/email-protection#97c5d0b9cef6faf5f6d7f1fff1f6b9f0f8e1"><span class="__cf_email__" data-cfemail="d68491f88fb7bbb4b796b0beb0b7f8b1b9a0">[email&#160;protected]</span></a>, (these are not toll-free numbers), 
Federal Housing Finance Agency, Constitution Center, 400 Seventh Street 
SW, Washington, DC 20219. For TTY/TRS users with hearing and speech 
disabilities, dial 711 and ask to be connected to any of the contact 
numbers above.

SUPPLEMENTARY INFORMATION:

I. Statutory and Regulatory Background

    The Federal Home Loan Bank Act (Bank Act) confers upon insured 
depository institutions that meet the statutory definition of a CFI 
certain advantages over non-CFI insured depository institutions in 
qualifying for Bank membership, and in the purposes for which they may 
receive long-term advances and the collateral they may pledge to secure 
advances.\1\ Section 2(10)(A) of the Bank Act and Sec.  1263.1 of 
FHFA's regulations define a CFI as any Bank member the deposits of 
which are insured by the Federal Deposit Insurance Corporation and that 
has average total assets below the statutory cap.\2\ The Bank Act was 
amended in 2008 to set the statutory cap at $1 billion and to require 
FHFA to adjust the cap annually to reflect the percentage increase in 
the CPI-U, as published by the DOL.\3\ For 2025, FHFA set the CFI asset 
cap at $1,500,000,000, which reflected a 2.7 percent increase over 
2024, based upon the increase in the CPI-U between 2023 and 2024.\4\
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    \1\ See 12 U.S.C. 1424(a), 1430(a).
    \2\ See 12 U.S.C. 1422(10)(A); 12 CFR 1263.1.
    \3\ See 12 U.S.C. 1422(10)(B); 12 CFR 1263.1 (defining the term 
``CFI asset cap'').
    \4\ See 90 FR 3865 (Jan. 15, 2025).
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II. The CFI Asset Cap for 2026

    As of January 1, 2026, FHFA will increase the CFI asset cap to 
$1,541,000,000, which reflects a 2.7 percent increase in the unadjusted 
CPI-U from November 2024 to November 2025. Consistent with the practice 
of other Federal agencies required to calculate and make annual 
adjustments based on CPI-U changes, FHFA bases the annual adjustment to 
the CFI asset cap on the percentage increase in the CPI-U from November 
of the year prior to the preceding calendar year to November of the 
preceding calendar year. The November figures represent the most recent 
available data as of January 1st of the current calendar year. FHFA 
determined the new CFI asset cap by applying the percentage increase in 
the CPI-U to the unrounded amount for the preceding year and rounding 
to the nearest million, as has been FHFA's practice for all previous 
adjustments.
    In calculating the CFI asset cap, FHFA uses CPI-U data that have 
not been seasonally adjusted (i.e., the data have not been adjusted to 
remove the estimated effect of price changes that normally occur at the 
same time and in about the same magnitude every year). The DOL 
encourages use of unadjusted CPI-U data in applying ``escalation'' 
provisions such as that governing the CFI asset cap, because the 
factors that are used to seasonally adjust the data are amended 
annually, and seasonally adjusted data that are published earlier are 
subject to revision for up to five years following their original 
release. Unadjusted data are not routinely subject to revision, and 
previously published unadjusted data are only corrected when 
significant calculation errors are discovered.

Joshua R. Stallings,
Deputy Director, Division of Federal Home Loan Bank Regulation, Federal 
Housing Finance Agency.
[FR Doc. 2025-24208 Filed 12-31-25; 8:45 am]
BILLING CODE 8070-01-P


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Notice of Annual Adjustment of the Cap on Average Total Assets That Defines Community Financial Institutions

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