| MPF Program Provides Value and Reliability |
Earlier this year, the Federal Home Loan Bank of Seattle became the eighth Federal Home Loan Bank to participate in the Mortgage Partnership Finance® (MPF®) Program. MPF in Focus recently spoke with Glen Simecek, Senior Vice President and Chief Business Officer for FHLBank Seattle, and Brett Manning, Vice President, National Sales and Funding Desk Manager for FHLBank Seattle, to learn about their experiences with the MPF Program.
What were the circumstances that led FHLBank Seattle to join the MPF Program?
Glen (below right): Prior to  the financial crisis, our members had a variety of avenues to sell their loans into the secondary market. During the crisis, a lot of the correspondent banks either became less competitive or exited the market entirely. Our members were really struggling with how to stay in the mortgage business with the changing environment.
Brett (left): It was a basic member value proposition. We weren’t currently providing a mortgage solution for our members, and the MPF Program allowed the Seattle Bank to offer a valuable access point to the secondary market.
What are some of the benefits you’ve realized?
Brett: The benefit of having another valuable product to provide to our members is important for both our members and our cooperative. Many of our members can sell to Fannie Mae and Freddie Mac or to correspondent banks, but having their Home Loan Bank cooperative - an organization they know and trust and work with on a regular basis - provide similar services is a real value-add. 
Glen: The response from members has been terrific. The Home Loan Bank System enjoys a lot of credibility as a reliable funding partner, and our members appreciate that we’re extending our offerings to include access to the secondary mortgage market. Particularly now, when they are looking at the future of housing finance reform and wondering if they will be able to compete in the mortgage market, having the Home Loan Bank in the mortgage business is a tremendous source of comfort, because they know their cooperative will be able to provide economies of scale and advocacy for their role in the system.
What do you feel are the most valuable benefits of the MPF Program?
Brett: Giving smaller rural members access to the secondary market is probably the greatest value-added service we can provide. Continuity of service is also important, as our cooperative members can rely on FHLB Seattle to provide an outlet for their mortgage originations.
Glen: As a cooperative, our business model is different from that of a traditional correspondent bank, in that we return value to our shareholders in a variety ways. One of those ways is through competitive product pricing. With MPF Xtra, our members can continue to originate the loans their customers want at attractive margins, which in turn helps them remain competitive in their markets. |
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