SAN JUAN, P.R.–Puerto Rico Gov. Jennifer González Colón has signed Law 73 of 2025, paving the way for Puerto Rico’s cooperativas to join the Federal Home Loan Bank of New York (FHLBNY), a move that will support cooperativas in expanding affordable homeownership in Puerto Rico, according to Inclusiv.
“For the past five years, Inclusiv has worked together with COSSEC and local partners to find a path forward for cooperativas to become eligible members of the FHLBNY,” Inclusiv President/CEO Cathie Mahon said in a statement. “We firmly believe that providing cooperativas with access to the services and resources of the FHLBNY will significantly expand homeownership opportunities across the island, particularly at this critical time.”
According to Inclusiv, the law amends Law 255 of 2002 “Ley de Sociedades Cooperativas de Ahorro y Crédito de 2022,” and authorizes Puerto Rico cooperativas to apply for membership in the FHLB system in alignment with its mission to provide affordable financial services, particularly in housing and community development.
It also updates Puerto Rico’s dissolution procedures for FHLB member cooperatives, preserving the FHLB’s lien priority in asset distribution, a requirement presented by the FHLBNY to move forward with the membership process, Inclusiv said.
More Than One-Million Members
Inclusiv noted that although the capital structure of cooperativas differs slightly from that of federally insured credit unions, they are publicly insured and regulated institutions serving more than 1.2-million-member owners.
“They offer essential financial services, including access to affordable homeownership. This structural distinction had long posed a barrier to their membership in the Federal Home Loan Bank System,” Inclusiv said.
In 2023, Inclusiv reported that it, along with COSSEC and more than 65 member cooperativas, submitted comment letters as part of the Federal Housing Finance Agency’s (FHFA) FHLBank System at 100: Focusing on the Future initiative, urging the removal of membership barriers for cooperativas. That same July, a COSSEC delegation met with FHFA officials to advocate for necessary regulatory reforms, according to the organization.
In April 2024, the FHFA issued a regulatory interpretation clarifying how FHLBanks should classify cooperativas when determining eligibility for membership.
Two Viable Pathways
“The interpretation outlined two viable pathways to membership for cooperativas and other state-chartered credit unions without federal share insurance,” Inclusiv explained. “Following this development, the Federal Home Loan Bank of New York and COSSEC signed a Memorandum of Understanding (MOU) to implement the new guidelines and advance the process toward cooperative membership.”
Inclusiv said it looks forward to the official opening of cooperativa membership in the bank and will continue working with local and national partners to provide the tools and resources needed for credit unions and cooperativas to expand their role as engines of economic development in their communities.