The NAIC’s Federal Home Loan Bank Legislation (E) Subgroup (the “FHLB Subgroup”) is considering, among other things, proposed amendments to the Insurer Receivership Model Act (“IRMA”) to provide certain exemptions for security agreements between insurance companies and Federal Home Loan Banks (“FHLBs”). The FHLBs, who often lend on a secured basis to insurance companies, are concerned about two main risks: (i) the risk that their ability to enforce their security interests could be impaired in by injunctions and orders issued at the commencement of an insurance insolvency proceeding and (ii) the risk of a “clawback” pursuant to the voidable preference and lien provisions of insurance insolvency laws. Accordingly, the proposed amendments would exempt FHLB security agreements from IRMA Section 108, Injunctions and Orders, and IRMA Section 604(C), Voidable Preferences and Liens. The FHLB Subgroup met at the NAIC Spring 2013 National Meeting to discuss the proposed amendments and receive presentations on the subject. Because the FHLB Subgroup expects the FHLB to ask state legislatures to amend state insurance receivership laws to incorporate the proposed amendments, the Subgroup approved a memo to state insurance regulators informing them about the proposed amendments and expressing the view that the states should act uniformly in addressing this legislative request, and do so only after the NAIC has fully studied the receivership considerations and has finalized a recommendation.