McCargo will succeed Teresa Bryce Bazemore as president and CEO of the Federal Home Loan Bank of San Francisco, a government-sponsored enterprise. The FHLBs have an implied guarantee by the U.S. government on their borrowing, but they are not federally funded or owned.

The changing of the guard comes at what McCargo sees as a "transitional, pivotal moment" for the San Francisco Home Loan bank given that the system it's part of has been drawing more attention due to the 2023 banking crisis and a regulatory review of its affordable housing activity.

The move will end a search for a successor to Bazemore that the Home Loan bank has been engaged in since last August. Bazemore agreed to stay in her post until McCargo starts on June 10, then temporarily serve as executive vice president and senior adviser until June 30. 

McCargo said she plans to follow in Bazemore's footsteps when it comes to raising the profile of the San Francisco Home Loan bank's role in efforts to promote housing that's affordable and racially equitable, noting she has big shoes to fill in that regard.

"She's done a tremendous job of really laying a framework. She's been very vocal, and I think very visible and very accessible as a bank president and CEO," McCargo said of Bazemore.

"I feel like Teresa's done a really good job with that and as I step in, I really want to continue that work and really make sure there's a full understanding of the huge impact and the great value that the Federal Home Loan Bank System provides," McCargo continued.

The two worked together in the past on an incubator program aimed at narrowing the racial homeownership gap when McCargo served as vice president in the Urban Institute's Housing Finance Policy Center and Bazemore was in her most recent role. 

They also crossed paths when Bazemore was president of mortgage insurer Radian Guaranty and McCargo was senior director of servicing portfolio management at Fannie Mae.

McCargo additionally had contact with the broader Federal Home Loan Bank system while at Ginnie, where she was the first woman of color to lead the agency. She also was the first woman to lead Ginnie.

The Chicago Home Loan Bank and Ginnie discussed recently how they might work together to give small institutions the access to affordable financing through the government-backed bond market that they wouldn't normally have.

"Alanna brings a wealth of hands-on experience from both the private and public sectors," said Dan Siciliano, chair of the San Francisco Federal Home Loan bank's board of directors, said in a press release.

"Throughout her career she has demonstrated a passion for advancing national policy directed at solving this country's affordable housing issues," he added.

The former Ginnie president's "broad areas of expertise, together with the relationships she has built across the entire housing finance system, will be a tremendous asset in her new role," said Marcia Fudge, former secretary of the Department of Housing and Urban Development, in the press release announcing McCargo's new position. Ginnie is part of HUD.

McCargo sees her new role at the San Francisco Home Loan bank as building on her experience at Ginnie, where she focused on how the agency's work created affordable financing for homebuyers.

While Ginnie Mae does this by guaranteeing securitized investor payments from mortgages that other agencies back at the loan level, the FHLBs accomplish it through regional cooperatives in which they receive lower-rate financing collateralized by their loan portfolios through the system.

A central Federal Home Loan bank office issues debt that bondholders buy to provide that financing. In return, the Federal Home Loan banks provide low-cost liquidity to their members to invest in a range of community lending. Fifteen percent of the profits from the Federal Home Loan banks are dedicated to funding affordable housing.

McCargo is seeking to build on existing Federal Home Loan bank down payment assistance programs and efforts that help borrowers without traditional credit histories build financial management track records, such as rent reporting.

Under Bazemore, the San Francisco Federal Home Loan bank introduced an initiative in which mortgages could be originated and financed using a nontraditional credit score.

The Bay Area and other regions the FHLB is active in have particular appeal for McCargo because they encompass many of the different types of affordable housing sources and communities she researched while at the Urban Institute.

Arizona, California and Nevada collectively host a mix of urban, rural and tribal communities. Property types range from manufactured housing to accessory dwelling units.

The affordable housing challenges in the district encompass "areas that I have spent a lot of time thinking about," said McCargo.