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56 HOUSE FINANCIAL SERVICES COMMITTEE HOLDS FSOC HEARING On June 21, 2016, the Financial Stability Oversight Council (FSOC) submitted its sixth 2016 annual report to Congress. e report's findings and recommendations are organized around what the FSOC identifies as "key potential emerging threats and vulnerabilities" e Committee on Financial Services held a hearing on ursday, September 22, to receive the "Annual Report of the Financial Stability Oversight Council" and the Secretary of the Treasury's testimony on the report. Treasury Secretary Jacob J. "Jack" Lew was the only witness at the hearing. Financial Services Committee Chairman Jeb Hensarling (R-Texas) delivered an opening statement at the full committee hearing noting his disappointment with the FSOC for delivering what he calls "the equivalent of a summer rerun." "Its 2016 annual report is basically identical to its 2015 annual report, breaking little new ground and adding little new value," said Hensarling. "FSOC, charged with identifying risks to our financial stability, continues to mention only in passing the need for fundamental housing finance reform. It fails to adequately analyze the substantial risk that Fannie Mae and Freddie Mac – institutions at the epicenter of the last financial crisis – pose for precipitating the next." Hensarling states that although FSOC's annual report is disappointing, he still believes that the Financial Services Committee's focus must remain on FSOC's "frightening and likely unconstitutional powers." Following Hensarling's remarks, Congresswoman Maxine Waters (D-California), Ranking Member of the Committee on Financial Services, discussed in her opening statement the importance of the FSOC in keeping the financial system safe. "With Wall Street reform, we created the FSOC to look across the entire financial system, identify gaps that may exist between regulators, and take action to prevent another meltdown," Waters said in her opening statement. "No longer would we allow banks to shop around for the weakest regulator or move money around the globe to escape regulation." In her remarks, Waters derided Republicans for their continued assault on the Dodd-Frank Act, particularly in light of the massive fraud uncovered at Wells Fargo this month. She questioned why "in this Committee, the answer is deregulation, and more opportunities for Wall Street to write the rules of the game" and pointed to Chairman Jeb Hensarling's Wall Street deregulation bill, H.R. 5983, which received bipartisan opposition in Committee last week. After the opening statements, the hearing was opened up to questions directed toward Lew and the FSOC's report and current work. TREASURY'S CDFI FUND ANNOUNCES 2016 AWARDEES e U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund) awarded 32 organizations nearly $91.5 million in grants for the development of affordable housing and community facilities in low-income communities, according to a recent release from the department. e report states that these awards were made through the fiscal year 2016 round of the Capital Magnet Fund, and they will also support financing for the preservation, rehabilitation, development or purchase of affordable housing for low-income communities as well as related economic development and community service facilities, such as day care centers, workforce development centers and health care clinics. "Affordable housing remains out of reach for far too many Americans," said Antonio Weiss, Counselor to Treasury Secretary Jacob J. Lew. "is funding will enable organizations across the country to expand access to affordable housing and help meet the critical needs of thousands of families." e department states that these 32 awardees will collectively serve 37 states and the District of Columbia. Additionally, the report states that nine of these awardees will invest 50 percent or more of their awards in non-metropolitan areas. More specifically, the report says that of the 32 awardees, 23 are classified as Community Development Financial Institutions (CDFIs), and nine of the awardees are classified as non- profit housing organizations. e department notes that these 32 awardees were selected after a merit-based competitive review of applications that were submitted from 125 organizations for awards in this round of the Capital Magnet Fund. "e impact of this program will be tremendous," said CDFI Fund Director Annie Donovan. "e program requires recipients to leverage $10 of housing and economic development investments for every $1 of federal funds meaning today's awards will support over $900 million of investment in low-income communities." e report says that since its creation in 1994, the CDFI Fund has awarded more than $2 billion to CDFIs, community development organizations, and financial institutions through the CDFI Program, the NACA Program, the Bank Enterprise Award Program, the Capital Magnet Fund, and the Financial Education and Counseling Pilot Program. In addition, the department states that the CDFI Fund has allocated $43.5 billion in tax credit allocation authority to Community Development Entities through the New Markets Tax Credit Program, and $852 million has been guaranteed in bonds through the CDFI Bond Guarantee Program. The percentage of mortgages in serious delinquency is 2.9 percent in July, according to CoreLogic. KNOW THIS

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