Troubled Asset Relief Program
Status of Efforts to Address Transparency and Accountability Issues
Gao ID: GAO-09-417T February 24, 2009
This testimony discusses our work on the Troubled Asset Relief Program (TARP), under which the Department of the Treasury (Treasury) has the authority to purchase and insure up to $700 billion in troubled assets held by financial institutions through the Office of Financial Stability (OFS). As you know, Treasury was granted this authority in response to the financial crisis that has threatened the stability of the U.S. banking system and the solvency of numerous financial institutions. The Emergency Economic Stabilization Act (the act) that authorized TARP on October 3, 2008, requires GAO to report at least every 60 days on findings resulting from our oversight of the status of actions taken under the program. We are also responsible for auditing OFS's annual financial statements and for issuing special reports on any issues that emerge from our oversight. To carry out these oversight responsibilities, we have assembled interdisciplinary teams with a wide range of technical skills, including financial market and public policy analysts, accountants, lawyers, and economists who represent combined resources from across GAO. In addition, we are building on our in-house technical expertise with targeted new hires, re-employed annuitants with related expertise, and outside experts. The act also created additional oversight entities--the Congressional Oversight Panel (COP) and the Special Inspector General for TARP (SIGTARP)--that also have reporting responsibilities. We are coordinating our work with COP and SIGTARP and are meeting with officials from both entities to share information and coordinate our oversight efforts. These meetings help to ensure that we are collaborating as appropriate and not duplicating efforts.
Treasury has announced a number of new programs to try to stabilize financial markets, but most of its activity during this period has continued to be through its Capital Purchase Program (CPP). As of February 19, Treasury had disbursed about $300 billion in TARP funds, about $196 billion of which was for CPP. Treasury has recently announced the Financial Stability Plan, which outlines a set of measures to address the financial crisis and restore confidence in the U.S. financial and housing markets, and a Homeowner Affordability and Stability Plan to mitigate foreclosures and preserve homeownership. Treasury also has taken important steps since our first report to implement all nine of our recommendations. However, due in part to the short time frame since our first report, we continued to identify a number of areas that warrant Treasury's ongoing attention concerning TARP.
GAO-09-417T, Troubled Asset Relief Program: Status of Efforts to Address Transparency and Accountability Issues
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Testimony:
Before the Subcommittee on Oversight and Investigations, Committee on
Financial Services, House of Representatives:
United States Government Accountability Office:
GAO:
For Release on Delivery:
Expected at 2:00 p.m. EST:
Tuesday, February 24, 2009:
Troubled Asset Relief Program:
Status of Efforts to Address Transparency and Accountability Issues:
Statement of Gene L. Dodaro:
Acting Comptroller General of the United States:
GAO-09-417T:
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here today to discuss our work on the Troubled Asset
Relief Program (TARP), under which the Department of the Treasury
(Treasury) has the authority to purchase and insure up to $700 billion
in troubled assets held by financial institutions through the Office of
Financial Stability (OFS).[Footnote 1] As you know, Treasury was
granted this authority in response to the financial crisis that has
threatened the stability of the U.S. banking system and the solvency of
numerous financial institutions. The Emergency Economic Stabilization
Act (the act) that authorized TARP on October 3, 2008, requires GAO to
report at least every 60 days on findings resulting from our oversight
of the status of actions taken under the program.[Footnote 2] We are
also responsible for auditing OFS's annual financial statements and for
issuing special reports on any issues that emerge from our oversight.
To carry out these oversight responsibilities, we have assembled
interdisciplinary teams with a wide range of technical skills,
including financial market and public policy analysts, accountants,
lawyers, and economists who represent combined resources from across
GAO. In addition, we are building on our in-house technical expertise
with targeted new hires, re-employed annuitants with related expertise,
and outside experts. The act also created additional oversight
entities--the Congressional Oversight Panel (COP) and the Special
Inspector General for TARP (SIGTARP)--that also have reporting
responsibilities. We are coordinating our work with COP and SIGTARP and
are meeting with officials from both entities to share information and
coordinate our oversight efforts. These meetings help to ensure that we
are collaborating as appropriate and not duplicating efforts.
My statement today is based primarily on our January 30, 2009 report,
the second under the act's mandate, which covers the actions taken as
part of TARP through January 23, 2009, and follows up on the nine
recommendations we made in our December 2, 2008 report.[Footnote 3]
This statement also provides additional information on some recent
program developments, including Treasury's new financial stability
plan. Our oversight work under the act is ongoing, and our next report
is due to be issued by March 31, 2009, as required.
Like the report, this statement focuses on (1) the nature and purpose
of activities that have been initiated under TARP; (2) the status of
the transition to the new administration at OFS and its hiring efforts,
use of contractors, and development of a system of internal control;
and (3) preliminary indicators of TARP's performance. To do this work,
we reviewed documents related to TARP, including contracts, agreements,
guidance, and rules. We also met with OFS, contractors, federal
agencies, and officials from all eight of the first large institutions
to receive disbursements. We plan to continue to monitor the issues
highlighted in the report, as well as future and ongoing capital
purchases, other more recent transactions undertaken as part of TARP
(for example, guarantees on assets of Citigroup and Bank of America),
and the status of other aspects of TARP. We conducted this performance
audit between December 2008 and February 2009 in accordance with
generally accepted government auditing standards. Those standards
require that we plan and perform the audit to obtain sufficient,
appropriate evidence to provide a reasonable basis for our findings and
conclusions based on our audit objectives. We believe that the evidence
obtained provides a reasonable basis for our findings and conclusions
based on our audit objectives.
Summary:
Treasury has announced a number of new programs to try to stabilize
financial markets, but most of its activity during this period has
continued to be through its Capital Purchase Program (CPP). As of
February 19, Treasury had disbursed about $300 billion in TARP funds,
about $196 billion of which was for CPP. Treasury has recently
announced the Financial Stability Plan, which outlines a set of
measures to address the financial crisis and restore confidence in the
U.S. financial and housing markets, and a Homeowner Affordability and
Stability Plan to mitigate foreclosures and preserve homeownership.
Treasury also has taken important steps since our first report to
implement all nine of our recommendations. However, due in part to the
short time frame since our first report, we continued to identify a
number of areas that warrant Treasury's ongoing attention concerning
TARP. Therefore, we recommended in our latest report that Treasury
continue to take action to further improve the transparency and
accountability of the program and more clearly articulate and
communicate a strategic vision. Specifically, we recommended that
Treasury:
* expand the scope of the monthly CPP surveys for the 20 largest banks
to include collecting at least some information from all institutions
participating in the program.
* ensure that future CPP agreements include a mechanism that will
better enable Treasury to track the use of the capital infusions and
seek to obtain similar information from existing CPP participants.
* establish a process to ensure compliance with all CPP requirements,
including those associated with limitations on dividends and stock
repurchase restrictions.
* communicate a clearly articulated vision for TARP and how all
individual programs are intended to work in concert to achieve that
vision. This vision should incorporate actions to preserve
homeownership. Once this vision is clearly articulated, Treasury should
document skills and competencies needed within the department.
* continue to expeditiously hire personnel needed to carry out and
oversee TARP.
* expedite efforts to ensure that sufficient personnel are assigned and
properly trained to oversee the performance of all contractors,
especially for contracts priced on a time-and-materials basis, and move
toward fixed-price arrangements whenever possible as program
requirements are better defined over time.
* develop a comprehensive system of internal control over TARP,
including policies, procedures, and guidance for program activities
that are robust enough to ensure that the program's objectives and
requirements are met.
* develop and implement a well-defined and disciplined risk-assessment
process, as such a process is essential to monitoring program status
and identifying any risks of potential inadequate funding of announced
programs.
* review and renegotiate existing conflict of interest mitigation
plans, as necessary, to enhance specificity and conformity with the new
interim conflicts of interest regulation, and take continued steps to
manage and monitor conflicts of interest and enforce mitigation plans.
Consistent with our recommendations, Treasury's recently announced
Financial Stability Plan outlines some steps it is taking to improve
the transparency and accountability of new programs going forward, but
Treasury still faces several challenges. First, our first report
emphasized the lack of monitoring and reporting for CPP investments and
recommended stronger measures for ensuring that participating
institutions use the funds to meet the program's purpose and comply
with CPP requirements on, for example, executive compensation and
dividend payments. In response to our recommendation, Treasury
completed its initial survey of the 20 largest institutions to monitor
lending and other activities and announced plans to analyze quarterly
monitoring data (call reports) for all reporting institutions.[Footnote
4] While the monthly survey is a step toward greater transparency and
accountability for the largest institutions, we continue to believe
that additional action is needed to better ensure that all
participating institutions are accountable for their use of program
funds. Second, Treasury has continued to develop a system to ensure
compliance with CPP requirements, including executive compensation,
dividend payments, and repurchase of stocks, but it has not yet
finalized its plans for detecting noncompliance and taking enforcement
actions. Third, we noted that Treasury had made limited progress in
articulating and communicating an overall strategic vision for TARP,
while continuing to respond to institution-and industry-specific needs.
This lack of clarity has complicated Treasury's ability to effectively
communicate to Congress, the financial markets, and the public.
However, Treasury has announced a plan to address foreclosure
mitigation and homeownership preservation, and as Treasury provides
more details on its new Financial Stability Plan, its strategic
approach to addressing the financial crisis may become clearer.
Treasury has taken proactive steps to help ensure a smooth transition
to a new administration by keeping positions filled and using an
expedited hiring process. However, it continues to face difficulty
providing competitive salaries to attract skilled employees. Also,
given the program's evolving nature and the likelihood of changes under
the new administration, Treasury will need to identify OFS's long-term
organizational needs. Additionally, consistent with our recommendation
about contracting oversight, Treasury has enhanced such oversight by
tracking costs, schedules, and performance and addressing the training
requirements of personnel who oversee the contracts. However, as we
previously recommended, Treasury needs to continue to identify and
mitigate conflicts of interest in contracting. Similarly, OFS has
adopted a framework for organizing the development and implementation
of its system of internal control for TARP activities, which is
consistent with our recommendation. However, as of our January report,
it had yet to implement a disciplined risk-assessment process.
Finally, given the fact that program actions have only recently
occurred and that there are time lags in the reporting of available
data, it is too early in the program's implementation to see measurable
results in many areas. Even with more time and better data, it will
remain difficult to separate the impact of TARP activities from the
effects of other economic forces. Credit market indicators we have
identified demonstrate that between our December and January reports,
the cost of credit declined in interbank, mortgage, and corporate debt
markets. Conversely, while perceptions of risk (as measured by premiums
over Treasury bonds) have declined in interbank markets, they appear to
have changed little in the corporate bond and mortgage markets.
However, attributing any of these changes directly to TARP continues to
be problematic because of the range of actions that have been and are
being taken to address the current crisis. While these indicators may
be suggestive of TARP's ongoing impact, no single indicator or set of
indicators can provide a definitive determination of the program's
impact.
Treasury Has Continued to Focus on CPP, but a Variety of Other Programs
Have Been Created or Are in Progress:
Treasury has continued to focus on CPP, but a variety of other programs
have been created or are in progress, as shown in table 1. As of
February 19, 2009, Treasury had disbursed almost 80 percent of the $250
billion it had allocated for CPP to purchase almost $196 billion in
preferred shares of 416 qualified financial institutions. Treasury has
begun to receive dividend payments relating to capital purchases under
CPP and other programs. According to Treasury, as of February 17, 2009,
it has received about $2.4 billion.
Table 1: Status of TARP Funds as of February 19, 2009:
Program: Capital Purchase Program;
Disbursed: $196.0 billion.
Program: Systemically Significant Failing Institutions;
Disbursed: $40.0 billion.
Program: Targeted Investment Program;
Disbursed: $40.0 billion.
Program: Term Asset-backed Securities Loan Facility;
Disbursed: 0.0.
Program: Automotive Industry Financing Program;
Disbursed: $23.7 billion.
Program: Citigroup Asset Guarantee;
Disbursed: 0.0.
Program: Bank of America Asset Guarantee;
Disbursed: 0.0.
Program: Totals;
Disbursed: $299.7 billion.
Source: Treasury OFS, unaudited.
[End of table]
Initially, Treasury approved $125 billion in capital purchases for nine
of the largest public financial institutions that federal banking
regulators and Treasury considered to be systemically significant to
the operation of the financial system.[Footnote 5] At the time, these
nine institutions held about 55 percent of U.S. banking assets.
Subsequent purchases were made in qualified institutions of various
sizes (in terms of total assets) and types. As we noted in our January
report, most of the institutions that received CPP capital were
publicly held institutions, while a limited number of privately held
institutions and community development financial institutions (CDFI)
also received funds.[Footnote 6]
Treasury has taken a number of important steps toward better reporting
on and monitoring of CPP, in accordance with our prior recommendations
that it bolster its ability to determine whether institutions were
using the proceeds consistent with the purposes of the act and that it
establish mechanisms to monitor compliance with program requirements.
However, more needs to be done. First, Treasury has initially surveyed
the largest institutions to monitor their lending and other activities
and announced plans to analyze quarterly monitoring data (call reports)
for all reporting institutions. While the monthly survey is a step
toward greater transparency and accountability for the largest
institutions, we continue to believe that additional actions are needed
to better ensure that all participating institutions are accountable
for their use of the funds. Without more frequent information on all
participants, Treasury will have little timely information about the
changing condition of the institutions, which may limit the ability of
its newly created team of analysts to understand the institutions' use
of the funds and the effectiveness of the program. In addition, without
ensuring that future CPP agreements include a mechanism that will
enable Treasury to track the use of capital infusions and without
seeking to obtain similar information from existing CPP participants,
Treasury may have difficulty determining that an institution has used
the funds in a manner consistent with the purposes of the program.
Therefore, we recommended that Treasury expand the scope of planned
monthly CPP surveys to include collecting at least some information
from all participating institutions. We also recommended that it ensure
that future CPP agreements include a mechanism that will enable
Treasury to track the use of capital infusions and seek to obtain
similar information from existing CPP participants. We will continue to
monitor Treasury's oversight efforts as well as the consistency of the
approval process in future work.
Second, Treasury has continued to take steps to increase its planned
oversight of compliance with terms of agreements such as limitations on
executive compensation, dividends, and stock repurchases. These steps
include naming an Interim Chief Compliance Officer. However, Treasury
has not finalized its plans for detecting noncompliance with these
requirements and taking enforcement actions. Without a more structured
mechanism in place to ensure compliance with all CPP requirements--and
as more institutions continue to participate in the program--ensuring
compliance with these aspects of the program will become increasingly
important and challenging. In its recently announced Financial
Stability Plan, Treasury called for banks receiving future government
funds to be held responsible for appropriate use of those funds through
(1) stronger restrictions on lending, dividend payment, and executive
compensation and (2) enhanced reporting to the public. In addition,
Treasury is in the process of drafting new regulations to implement the
executive compensation requirements in the American Recovery and
Reinvestment Act of 2009.[Footnote 7] We will also continue to monitor
the system that Treasury develops to ensure compliance with their
agreements and the implementation of additional oversight and
accountability efforts under its new plan.
Treasury has continued to make some progress in improving the
transparency of the program and a few weeks ago announced its plans for
the remaining TARP funds. In our December 2008 report, we first raised
questions about the effectiveness of Treasury's communication strategy
for TARP with Congress, the financial markets, and the public. These
questions were further heightened in the COP's January report, which
raised similar questions about Treasury's strategy for TARP. In
response to our recommendation about its communication strategy,
Treasury noted numerous publicly available reports, testimonies, and
speeches. However, even after reviewing these items collectively, we
found that Treasury's strategic vision for TARP remained unclear. For
example, Treasury initially outlined a strategy to purchase whole loans
and mortgage-backed securities from financial institutions, but changed
direction to make capital investments in qualifying financial
institutions as the global community opted to move in this direction.
However, once Treasury determined that capital infusions were
preferable to purchasing whole mortgages and mortgage-backed
securities, Treasury did not clearly articulate how the various
programs--such as CPP, the Systemically Significant Failing
Institutions Program (SSFI) , and the Targeted Investment Program
(TIP)--would work collectively to help stabilize financial markets. For
instance, Treasury has used similar approaches--capital infusions--to
stabilize healthy institutions under CPP as well as SSFI and TIP,
albeit with more stringent requirements. Moreover, with the exception
of institutions selected for TIP being viewed as able to raise private
capital, both SSFI and TIP share similar selection criteria. Treasury
also created the Auto Industry Financing Program in December 2008 to
prevent a disruption of the domestic automotive industry that would
pose systemic risk to the nation's economy and provided loans to two
auto companies and two financing companies that, among other business
lines, provide consumer automotive loans. Finally, the same institution
may be eligible for multiple programs--at least two institutions
(Citigroup and Bank of America) currently participate in more than one
program--and this has added to confusion about Treasury's strategy and
vision for the implementation of TARP. Other actions also have raised
additional questions about Treasury's strategy. For example, Treasury
announced the first institution under TIP weeks before the program was
established. Similarly, the Asset Guarantee Program was established
only after Treasury announced that it would guarantee assets under such
a program, and many of the details of the program have yet to be worked
out.
Since our January report, Treasury has taken two key actions related to
our recommendation about the need for a clearly articulated vision for
the program. On February 10, Treasury announced the Financial Stability
Plan, which outlines a set of measures to address the financial crisis
and restore confidence in U.S. financial and housing markets. The plan
appears to be an approach designed to resolve the credit crisis by
restarting the flow of credit to consumers and businesses,
strengthening financial institutions, and providing aid to homeowners
and small businesses. On February 18, Treasury unveiled its Homeowner
Affordability and Stability Plan, which, in part, is based on the use
of TARP funds. Specifically, the plan will use $75 billion of TARP
funds to modify the loans of up to 3-4 million homeowners to avoid
potential foreclosure. The plan also includes a number of other
components, including an initiative to help an additional 4-5 million
homeowners with loans owned or guaranteed by Freddie Mac and Fannie Mae
refinance their loans at current market rates.[Footnote 8] We will
continue to monitor the development and implementation of Treasury's
plan. In addition, we will assess the extent to which the plan
addresses the need for a clearly articulated vision for TARP and
explains how the individual programs are intended to work in concert to
achieve that vision.
Efforts to Establish OFS Are Ongoing:
Treasury has made progress in establishing its management
infrastructure, which included hiring, contracting oversight, and
internal controls. However, hiring for the Office of Financial
Stability is still ongoing, Treasury is working to improve its
oversight of contractors, and its development of a system of internal
control is still evolving.
* In the hiring area, Treasury took steps to help maintain continuity
of leadership within OFS during and after the transition to the new
administration, one of the areas we highlighted in our first report.
Specifically, Treasury ensured that interim chief positions would be
filled to ensure a smooth transition and used direct-hire authority and
various other appointments to bring a number of career staff on board
quickly. OFS has increased its overall staff since our December 2008
report from 48 to 90 employees as of January 26, which includes an
increase of permanent staff from 5 to 38. While progress has been made
since our last report, the number of temporary and contract staff who
will be needed to serve long-term organizational needs remains unknown.
Because TARP has added many new programs since it was first established
in October and program activities may expand or change under the new
administration, we recognize that Treasury may find it difficult to
determine OFS's long-term organizational needs at this time. However,
such considerations will be vital to retaining institutional knowledge
in the organization.
* Treasury's use of existing contract flexibilities has enabled it to
enter into agreements and award contracts quickly in support of TARP.
However, Treasury's use of time-and-materials contracts, although
authorized when flexibility is needed, can increase the risk of wasted
government dollars without adequate oversight of contractor
performance. Although Treasury has improved its oversight of
contractors, the department itself has identified certification of its
Contracting Officer Technical Representatives and the use of time-and-
materials pricing to be high-risk issues that still need attention. In
addition, while Treasury has taken the important step of recently
issuing an interim regulation outlining the process for reviewing and
addressing conflicts of interest among new contractors and financial
agents, it is still reviewing contracts or agreements that existed
prior to issuance to ensure conformity with the new regulation. We
believe this is a necessary component of a comprehensive and complete
system to ensure that all conflicts are fully identified and
appropriately addressed.
* OFS has adopted a framework for organizing the development and
implementation of its system of internal control for TARP activities.
OFS plans to use this framework to develop specific policies, drive
communications on expectations, and measure compliance with internal
control standards and policies. However, it has yet to develop
comprehensive written policies and procedures governing TARP activities
or implement a disciplined risk assessment process.
In each of these areas, we made additional recommendations.
Specifically, we recommended that Treasury continue to expeditiously
hire personnel needed to carry out and oversee TARP. For contracting
oversight, we recommended that Treasury expedite efforts to ensure that
sufficient personnel are assigned and properly trained to oversee the
performance of all contractors, especially for contracts priced on a
time-and-materials basis, and move toward fixed-price arrangements
whenever possible as program requirements are better defined over time.
We also recommended that Treasury review and renegotiate existing
conflict-of-interest mitigation plans, as necessary, to enhance
specificity and conformity with the new interim conflicts of interest
regulation, and take continued steps to manage and monitor conflicts of
interest and enforce mitigation plans. Finally, we recommended that
Treasury, in addition to developing a comprehensive system of internal
control, develop and implement a well-defined and disciplined risk
assessment process, as such a process is essential to monitoring
program status and identifying any risks of potentially inadequate
funding of announced programs. We will continue to monitor OFS's hiring
and contracting practices as well as its implementation of the internal
control framework, which is vital to the effectiveness of the program.
Measuring the Impact of TARP on Credit Markets and the Economy
Continues to Be Challenging:
Given the fact that program actions have only recently occurred and
that there are time lags in the reporting of available data, it
continues to be too early in the program's implementation to see
measurable results in many areas. Even with more time and better data,
it will remain difficult to separate the impact of TARP activities from
the effects of other economic forces. Some indicators suggest that the
cost of credit has declined in interbank, mortgage, and corporate debt
markets since the December report. However, while perceptions of risk
(as measured by premiums over Treasury securities) have declined in
interbank markets, they have changed very little in corporate bond and
mortgage markets. Finally, as noted in December, these indicators may
be suggestive of TARP's ongoing impact, but no single indicator or set
of indicators can provide a definitive determination of the program's
effects because of the range of actions that have been and are being
taken to address the current crisis. These include coordinated efforts
by U.S. regulators--namely, the Federal Deposit Insurance Corporation,
the Board of Governors of the Federal Reserve System, and the Federal
Housing Finance Agency--as well as actions by financial institutions to
mitigate foreclosures. For example, a large drop in mortgage rates
occurred shortly after the Federal Reserve announced it would purchase
up to $500 billion in mortgage-backed securities, highlighting that
policies outside of TARP may have important effects on credit markets.
We will continue to refine and monitor the indicators. Additionally, we
plan to use the Treasury survey data in our efforts to evaluate changes
in lending activity resulting from CPP. We recognize that the data has
certain limitations--primarily that it is self-reported and difficult
to benchmark because it is unique. Nonetheless, we think it will prove
valuable in future analyses.
Mr. Chairman and Members of the Subcommittee, I appreciate the
opportunity to discuss this critically important issue and would be
happy to answer any questions that you may have. Thank you.
Contact:
For further information on this testimony, please contact Thomas J.
McCool on (202) 512-2642 or mccoolt@gao.gov.
[End of section]
Footnotes:
[1] GAO, Troubled Asset Relief Program: Status of Efforts to Address
Transparency and Accountability Issues, [hyperlink,
http://www.gao.gov/products/GAO-09-296] (Washington D.C.: Jan. 30,
2009) and Troubled Asset Relief Program: Additional Actions Needed to
Better Ensure Integrity, Accountability, and Transparency, [hyperlink,
http://www.gao.gov/products/GAO-09-161] (Washington, D.C.: Dec. 2,
2008).
[2] The Emergency Economic Stabilization Act of 2008, Pub. L. No. 110-
343, 122 Stat. 3765 (2008). The act requires the U.S. Comptroller
General to report at least every 60 days, as appropriate, on findings
resulting from oversight of TARP's performance in meeting the act's
purposes; the financial condition and internal controls of TARP, its
representatives, and agents; the characteristics of asset purchases and
the disposition of acquired assets, including any related commitments
entered into; TARP's efficiency in using the funds appropriated for its
operations; its compliance with applicable laws and regulations; and
its efforts to prevent, identify, and minimize conflicts of interest
among those involved in its operations.
[3] Information is current as of January 23, 2009, unless otherwise
noted in the statement.
[4] Call reports are quarterly reports that collect basic financial
data of commercial banks in the form of a balance sheet and income
statement (formally known as Report of Condition and Income).
[5] While Treasury approved $125 billion to the nine largest
institutions, it initially disbursed funds to eight of the nine
institutions. The $10 billion to Merrill Lynch was not disbursed until
January 9, 2009, after its merger with Bank of America was completed.
[6] A CDFI is a specialized financial institution that works in market
niches that are underserved by traditional financial institutions.
CDFIs provide a range of financial products and services such as
mortgage financing for low-income and first-time homebuyers and not-
for-profit developers; flexible underwriting and risk capital for
needed community facilities; and technical assistance, commercial loans
and investments to small start-up or expanding businesses in low-income
areas.
[7] Pub. L. No. 111-5, 123 Stat. 115 (2009).
[8] As part of its Homeowner Affordability and Stability Plan, Treasury
announced that it was increasing its funding commitment to Fannie Mae
and Freddie Mac to ensure the strength and security of the mortgage
market and to help maintain mortgage affordability. The $200 billion
funding commitment is based on authority granted to Treasury under the
Housing and Economic Recovery Act of 2008 Pub. L. No. 110-289, 122
Stat.2654 (2008).
[End of section]
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(202) 512-4400:
U.S. Government Accountability Office:
441 G Street NW, Room 7125:
Washington, D.C. 20548:
Public Affairs:
Chuck Young, Managing Director, youngc1@gao.gov:
(202) 512-4800:
U.S. Government Accountability Office:
441 G Street NW, Room 7149:
Washington, D.C. 20548: