<PAGE> 1
		     SECURITIES AND EXCHANGE COMMISSION
			 Washington, D.C. 20549
			  ____________________

	   x  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
		    THE SECURITIES EXCHANGE ACT OF 1934

		 For the fiscal year ended December 31, 1996

				   OR

	  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
		   THE SECURITIES EXCHANGE ACT OF 1934

		 For the transition period from     to
		   Commission File Number 33-20166

			   _________________

	RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (TEX-LA) 1988-T2
	(Exact name of registrant as specified in its charter)

				  NEW YORK
	(State or other jurisdiction of incorporation or organization)

				36-6878774
		  (I.R.S. Employer Identification Number)

	       2201 Cooperative Way, Herndon, VA 20171-3025
		(Address of principal executive offices)
    (Registrant's telephone number, including area code, is 703-709-6700)

			  ___________________

	Securities Registered pursuant to Section 12(b) of the Act:  None.

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.

			   Yes   X      No

	    The Registrant has no common or voting stock.

	DOCUMENTS INCORPORATED BY REFERENCE:

1.      Form of Trust Agreement
2.      Loan Agreement
3.      Loan Guarantee and Servicing Agreement

Exhibit Index located on page 13.
<PAGE> 2
Part I

Item 3. Legal Proceedings

			None.


Item 4. Submission of Matters to a Vote of Security Holders

			None.
<PAGE> 3
Part II

Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters

	a)              There is no established trading market for the
			certificates representing ownership of the beneficial
			interest in the Trust.

	b)              As of March 28, 1997 there were two holders of
			certificates representing ownership of the beneficial
			interest in the Trust.


Item 8. Financial Statements and Supplementary Data

			See attached audited financial statements.


Item 9. Disagreements on Accounting and Financial Disclosure

			None.



Part III

Item 13.        Certain Relationships and Related Transactions

			None.
<PAGE> 4

Part IV

Item 14.        Exhibits, Financial Statement Schedules and Reports
			on Form 8-K

	a)      The following documents are filed as part of this report:

			1.      Financial Statements
				Report of Independent Public Accountants
				Statement of Assets and Liabilities as of
					December 31, 1996 and 1995
				Statement of Income and Expenses, for the
				Years Ended December 31, 1996, 1995 and 1994
				Statement of Cash Flows, for the Years Ended
					December 31, 1996, 1995 and 1994
				Notes to Financial Statements

			2.      Financial Statement Schedules are omitted
				because they are inapplicable.

			3.      Exhibits

				Exhibit
				Number          Description of Exhibit

				 4.1            Form of Trust Agreement,
						including the form of Rural
						Electric Cooperative Grantor
						Trust Certificate
						(incorporated by reference
						to Exhibit 4.1 to
						Registration Statement on
						Form S-1 [No. 33-20166]).

				10.1            Loan Agreement (incorporated
						by reference to Exhibit 10.1
						to Registration Statement on
						Form S-1 [No. 33-20166]).

				10.2            Loan Guarantee and Servicing
						Agreement (incorporated by
						reference to Exhibit 10.2 to
						Registration Statement on
						Form S-1 [No. 33-20166]).

		b)      Form 8-K dated December 17, 1996.
			Semi-annual Report to Certificateholders dated
			December 15, 1996.

Supplemental information to be furnished with reports filed pursuant to
Section 15(d) of the Act by Registrants which have not registered securities
pursuant to Section 12 of the Act.

	No annual report, proxy statement, form of proxy or other proxy
	soliciting material has been sent to Certificateholders, and the
	Registrant does not presently contemplate sending any such material
	subsequent to the filing of this report.

<PAGE> 5
	Pursuant to the requirements of Section 13 or 15(d) of the Securities
	Act of 1934, the Registrant has duly caused this report to be signed
	on its behalf by the undersigned, thereunto duly authorized, in the
	County of Fairfax, Commonwealth of Virginia on the 28th day of March,
	1997.


	RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (TEX-LA) 1988 T-2

			By:     NATIONAL RURAL UTILITIES COOPERATIVE
				FINANCE CORPORATION as Servicer

				By:    /S/ Sheldon C. Petersen
					Sheldon C. Petersen, Governor and
					   Chief Executive Officer

<PAGE> 6

 .









		     RURAL ELECTRIC COOPERATIVE GRANTOR
			  TRUST (TEX-LA) 1988-T2


	   FINANCIAL STATEMENTS AS OF DECEMBER 31, 1996 AND 1995,
	 AND FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
		      TOGETHER WITH AUDITORS' REPORT


<PAGE> 7



	Report of Independent Public Accountants



To the Trustee of
Rural Electric Cooperative Grantor Trust
	(Tex-La) 1988-T2, and

To the Board of Directors of
National Rural Utilities Cooperative
	Finance Corporation:


We have audited the accompanying statements of assets and liabilities of
Rural Electric Cooperative Grantor Trust (Tex-La) 1988-T2 as of December
31, 1996 and 1995, and the related statements of income and expenses and
cash flows for each of the three years in the period ended December 31,
1996.    These financial statements are the responsibility of the Trust's
management.  Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform an audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation.  We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Rural Electric
Cooperative Grantor Trust (Tex-La) 1988-T2 as of December 31, 1996 and 1995,
and the results of its operations and its cash flows for the years ended
December 31, 1996, 1995 and 1994, in conformity with generally accepted
accounting principles.


March 24, 1997
Washington, D. C.

<PAGE> 8
<TABLE>
<CAPTION>
       RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (TEX-LA) 1988-T2

		  STATEMENTS OF ASSETS AND LIABILITIES

		     AS OF DECEMBER 31, 1996 AND 1995

    _____________________________________________________________________


					 1996                 1995

<S>                                 <C>                   <C>
ASSETS

Interest Receivable                    $625,491              $625,491

Note Receivable                      85,075,000            85,075,000

     Total Assets                   $85,700,491           $85,700,491





LIABILITIES

Interest Payable-
Grantor Trust Certificates            $611,264               $611,264

Servicer Fees Payable                   14,227                 14,227

Rural Electric Cooperative
  Grantor Trust Certificates        85,075,000             85,075,000

     Total Liabilities             $85,700,491            $85,700,491

</TABLE>










	      The accompanying notes are an integral part
		      of these financial statements




<PAGE> 9
<TABLE>
<CAPTION>
	  RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (TEX-LA) 1988-T2

		     STATEMENTS OF INCOME AND EXPENSES

	   FOR THE YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994

    _____________________________________________________________________



					1996          1995          1994
<S>                                 <C>            <C>           <C>
INCOME:
  Interest on note receivable       $8,339,885     $8,339,885    $8,339,885


EXPENSES:
  Interest on
  grantor trust certificates         8,150,185      8,150,185     8,150,185
  Servicer fees                        189,700        189,700        189,700

      Total Expenses                 8,339,885      8,339,885     8,339,885

      Net Income                     $       -      $       -     $       -


</TABLE>









		The accompanying notes are an integral part
		     of these financial statements

<PAGE> 10
<TABLE>
<CAPTION>
	 RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (TEX-LA) 1988-T2

			   STATEMENTS OF CASH FLOWS

	    FOR THE YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994

   _____________________________________________________________________

				 1996            1995             1994
<S>                          <C>               <C>                <C>
CASH FLOWS FROM
  OPERATING ACTIVITIES:
  Interest received on
    note receivable          $ 8,339,885       $ 8,339,885        $ 8,339,885
  Interest paid to
    Certificateholders       (8,150,185)       (8,150,185)        (8,150,185)
  Fees paid to Servicer        (189,700)         (189,700)          (189,700)

     Net cash provided by
       operating activities           -                 -                  -


CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from principal
    payment on note                    -                -                  -

    Net cash provided from
     investing activities              -                -                  -


CASH FLOWS FROM FINANCING ACTIVITIES:
  Principal payment to
    Certificateholders                 -                -                  -

    Net cash used in
     financing activities              -                -                  -

NET CHANGE IN CASH                     -                -                  -

CASH, beginning of year                -                -                  -

CASH, end of year              $       -        $       -          $       -

ACCRUAL TO CASH BASIS RECONCILIATION:
  Accrual basis income         $       -        $       -          $       -
  Change in accrual accounts:
   Decrease in interest
    receivable                         -                -                  -
   Decrease in interest
    payable                            -                -                  -
   Decrease in servicer
    fees payable                       -                -                  -

     Total change in
      accrual accounts                 -                -                   -

Net cash provided by
   operating activities        $       -       $        -           $       -
</TABLE>
		     The accompanying notes are an integral part
			    of these financial statements

<PAGE> 11



	      RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (TEX-LA) 1988-T2

			    NOTES TO FINANCIAL STATEMENTS

		      AS OF DECEMBER 31, 1996, 1995 AND 1994


1.      ORGANIZATION AND OPERATIONS

	Rural Electric Cooperative Grantor Trust (Tex-La) 1988-T2 (the
	"Trust") was formed under a Trust Agreement dated February 15, 1988
	among National Rural Utilities Cooperative Finance Corporation
	("CFC"), Tex-La Electric Cooperative of Texas, Inc. (the
	"Cooperative") and the First National Bank of Chicago (the
	"Trustee").   On that date, CFC made a loan to the Cooperative
	which issued a note (the "Note"), evidencing the borrowing, to the
	Trust.  The Trust issued to CFC Rural Electric Cooperative Grantor
	Trust (Tex-La) 9.58% Certificates Due 2019 (the "Certificates") in
	the amount of $85,075,000.  The Certificates are solely the
	obligations of the Trust and are not insured or guaranteed by CFC,
	the Cooperative, the Trustee, the Rural Utilities Service ("RUS")
	of the United States Department Agriculture ("USDA") nor any other
	governmental agency.  Each Certificate represents an undivided
	fractional interest in the Trust.  CFC is the depositor of the Trust
	and acts as Servicer of the Note.   CFC filed, on behalf of the
	Trust, a Registration Statement on Form S-1 (Registration No.
	33-20166) which became effective on March 9, 1988, and CFC resold
	the Certificates thereunder.

	The assets of the Trust consist primarily of the Note, bearing
	interest at 9.80% and maturing 2019,  which is guaranteed (the
	"Guarantee") as to timely payment of principal and interest by
	the United States of America, acting through the Administrator of
	RUS.  The amounts of principal and interest payments on the Note
	held by the Trust are sufficient to cover the scheduled principal
	and interest payments on the Certificates issued by the Trust and
	the scheduled amounts of servicer fees.  The General Counsel of the
	USDA has issued an opinion that the Guarantee is supported by the
	full faith and credit of the United States of America.

	Debt service and servicer fee payments on the Note are made to the
	Trustee semi-annually (June 4 and December 4) by the Cooperative.
	The Trustee deposits all such receipts in the Trust account.  The
	Trustee is authorized by the Trust Agreement to invest all funds
	in the Trust account at the direction of CFC in certain eligible
	investments that mature no later than the business day next
	preceding the day (June 15 and December 15) such amounts are to be
	distributed to the Certificateholders and the Servicer.  The
	interest earned on the investments is distributed to the Cooperative.
	Any funds that are not so invested must be held by the Trustee in
	the Trust account.  The Trustee may not reinvest any returns of
	principal or investment earnings on eligible investments and the
	Trustee may not sell any eligible investment prior to its maturity
	except, at the direction of CFC,  to preserve the value of the corpus
	of the Trust.

	On or before five business days after each date on which payments
	are made on the Certificates, the Trustee is obligated to supply
	the holders of such Certificates a report provided by the Servicer,
	which includes certain pertinent information as to how the payment
	is to be allocated to principal, interest, servicer fees and premium,
	if any, as well as the principal balance outstanding after such
	payment.

	The fiscal year of the Trust is the calendar year.  Within the
	prescribed period of time for tax reporting purposes, after the end
	of each calendar year during the term of the Trust Agreement, the
	Trustee is obligated to prepare and mail to each Certificateholder
	of record for the Trust, at any time during such year, a report
	setting forth the information as is reasonably necessary for the
	preparation of such Certificateholder's Federal income tax return.
<PAGE> 12







	Payments of principal on the Certificates are scheduled to be repaid
	over a period of seventeen years beginning in 2003.  The principal
	payment in 2003 is scheduled to be $2,650,000.  The Certificates are
	not subject to redemption prior to December 15, 1997.  Thereafter,
	such Certificates are subject to optional redemption, in whole and
	with premium until 2008, upon redemption or purchase of the related
	Note.  The Trust Agreement will terminate after payment in full has
	been made on the Certificates issued thereunder.


2.      TAX STATUS OF THE TRUST

	Milbank, Tweed, Hadley & McCloy, counsel to CFC, has advised CFC
	with respect to the Trust that, in its opinion, (i) the Trust will
	not be classified as an association taxable as a corporation, but
	will be classified as a grantor trust and (ii) each Certificateholder
	will be treated for Federal income tax purposes as the owner of an
	undivided fractional interest in each of the assets held by the
	Trust.

	It is expected that the Trust will not have any liability for
	Federal or state income taxes for the current or future years.

3.      INTEREST AND SERVICER FEE ACCOUNTING

	The Trust records interest income as it is earned and accrues
	interest expense and servicer fees as they are incurred.
	Servicer fees represent ten basis points of the outstanding
	principal balance of the Certificates and the Note and recognition
	of conversion fees over the life of the loan.


4.      FAIR VALUE OF FINANCIAL INSTRUMENTS

	Use Of Estimates

	The preparation of financial statements in conformity with generally
	accepted accounting principles requires management to make estimates
	and assumptions that affect the reported amounts of assets and
	liabilities at the date of the financial statements and the reported
	amounts of expenses during the reported period.  The estimates
	involve judgments with respect to, among other things, various
	future factors which are difficult to predict and are beyond the
	control of the Trust.  With regards to the fair values below, actual
	amounts could differ from these estimates.

	The following disclosure of the estimated fair value of financial
	instruments is made in accordance with FASB Statement No. 107,
	"Disclosure about Fair Value of Financial Instruments."  Whenever
	possible, the estimated fair value amounts have been determined
	using quoted market information as of December 31, 1996 and 1995,
	along with other valuation methodologies which are summarized below.
	Below is a summary of significant methodologies used in estimating
	fair value amounts and a schedule of fair values at December 31,
	1996 and 1995.

	The carrying amounts reported for Interest Receivable, Interest
	Payable - Grantor Trust Certificates, and Servicer Fees Payable
	approximate fair values due to the short term maturity of these
	instruments.

<PAGE> 13


Note Receivable

Fair value is estimated by discounting the future cash flows using the
current rates at which similar loans would be made to borrowers with
similar credit ratings and for the same remaining maturities.

Rural Electric Cooperative Grantor Trust Certificates

The fair value of the Certificates is estimated using quoted market prices
for similar notes over the same remaining maturities.

The carrying and estimated fair values of the Trust's financial instruments
as of December 31, 1996 and 1995, are as follows:

<TABLE>
<CAPTION>

					    1996                             1995
				   Carrying         Fair         Carrying          Fair
				     Value          Value         Value            Value
<S>                             <C>             <C>             <C>
Assets:
Interest Receivable                625,491          625,491        625,491          625,491
Note Receivable                 85,075,000      109,562,050     85,750,000      116,949,168

Liabilities:
Interest Payable - Grantor
Trust Certificates                 611,264          611,264         53,649           53,649
Servicer Fees Payable               14,227           14,227         14,227           14,227
Rural Electric Cooperative
  Grantor Trust Certificates    85,075,000      110,031,126     85,075,000      117,594,592

</TABLE>
<PAGE> 14








	RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (TEX-LA) 1988 T-2



	Exhibit Index


Exhibit
Number          Description of Exhibit

 4.1            Form of Trust Agreement, including the form of Rural
		Electric Cooperative Grantor Trust Certificate (incorporated
		by reference to Exhibit 4.1 to Registration Statement on
		Form S-1 [No. 33-20166]).

10.1            Loan Agreement (incorporated by reference to Exhibit 10.1
		to Registration Statement on Form S-1 [No. 33-20166]).

10.2            Loan Guarantee and Servicing Agreement (incorporated by
		reference to Exhibit 10.2 to Registration Statement on
		Form S-1 [No. 33-20166]).

<END>