Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Introduction

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 12/13/2012

Date Modified: 2/15/2018

Public Law 92–181, 85 Stat. 583

92d Congress, S. 1483, December 10, 1971

amended by

Public Law 94–184, 89 Stat. 1060

94th Congress, H.R. 7862, December 31, 1975

Public Law 95–443, 92 Stat. 1066

95th Congress, S. 3045, October 10, 1978

Public Law 96–592, 94 Stat. 3437

96th Congress, S. 1465, December 24, 1980

Public Law 99–190, 99 Stat. 1185

99th Congress, H.J. Res. 465, December 19, 1985

Public Law 99–198, 99 Stat. 1354

99th Congress, H.R. 2100, December 23, 1985

Public Law 99–205, 99 Stat. 1678

99th Congress, S. 1884, December 23, 1985

Public Law 99–509, 100 Stat. 1874

99th Congress, H.R. 5300, October 21, 1986

Public Law 100–233, 101 Stat. 1568

100th Congress, H.R. 3030, January 6, 1988

Public Law 100–399, 102 Stat. 989

100th Congress, H.R. 3980, August 17, 1988

Public Law 100–460, 102 Stat. 2229

100th Congress, H.R. 4784, October 1, 1988

Public Law 101–73, 103 Stat. 183

101st Congress, H.R. 1278, August 9, 1989
Public Law 101–220, 103 Stat. 1876

101st Congress, S. 1793, December 12, 1989

Public Law 101–624, 104 Stat. 3359

101st Congress, S. 2830, November 28, 1990

Public Law 102–237, 105 Stat. 1818

102d Congress, H.R. 3029, December 13, 1991

Public Law 102–552, 106 Stat. 4102

102d Congress, H.R. 6125, October 28, 1992

Public Law 103–376, 108 Stat. 3497

103d Congress, H.R. 4379, October 19, 1994

Public Law 104–105, 110 Stat. 162

104th Congress, H.R. 2029, February 10, 1996

Public Law 104-316, 110 Stat. 3831

104th Congress, H.R. 3864, October 19, 1996

Public Law 107-171, 116 Stat. 134

107th Congress, H.R. 2646, May 13, 2002

Public Law 110-246, 122 Stat. 1651

110th Congress, H.R. 6124, June 18, 2008

AN ACT

To further provide for the farmer-owned cooperative system of making credit available to farmers and 

ranchers and their cooperatives, for rural residences, and to associations and other entities upon which 

farming operations are dependent, to provide for an adequate and flexible flow of money into rural areas, 

and to modernize and consolidate existing farm credit law to meet current and future rural credit needs, 

and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress 

assembled, That this Act may be cited as the "Farm Credit Act of 1971."
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Introduction

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2001 SEC. 1.1. POLICY AND OBJECTIVES.—

(a) It is declared to be the policy of the Congress, recognizing that a 

prosperous, productive agriculture is essential to a free nation and recognizing 

the growing need for credit in rural areas, that the farmer-owned cooperative 

Farm Credit System be designed to accomplish the objective of improving the 

income and well-being of American farmers and ranchers by furnishing sound, 

adequate, and constructive credit and closely related services to them, their 

cooperatives, and to selected farm-related businesses necessary for efficient farm 

operations.

(b) It is the objective of this Act to continue to encourage farmer- and 

rancher-borrowers participation in the management, control, and ownership of a 

permanent system of credit for agriculture which will be responsive to the credit 

needs of all types of agricultural producers having a basis for credit, and to 

modernize and improve the authorizations and means for furnishing such credit 

and credit for housing in rural areas made available through the institutions 

constituting the Farm Credit System as herein provided.

(c) It is declared to be the policy of Congress that the credit needs of 

farmers, ranchers, and their cooperatives are best served if the institutions of the 

Farm Credit System provide equitable and competitive interest rates to eligible 

borrowers, taking into consideration the creditworthiness and access to 

alternative sources of credit for borrowers, the cost of funds, including any costs 

of defeasance under section 4.8(b), the operating costs of the institution, 

including the costs of any loan loss amortization under section 5.19(b), the cost 

of servicing loans, the need to retain earnings to protect borrowers' stock, and the 

volume of net new borrowing. Further, it is declared to be the policy of Congress 

that Farm Credit System institutions take action in accordance with the Farm 

Credit Act Amendments of 1986 in such manner that borrowers from the 

institutions derive the greatest benefit practicable from that Act: Provided, that 

in no case is any borrower to be charged a rate of interest that is below 

competitive market rates for similar loans made by private lenders to borrowers 

of equivalent credit-worthiness and access to alternative credit.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Introduction

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2002

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2002 SEC. 1.2. THE FARM CREDIT SYSTEM.—

(a) COMPOSITION.—The Farm Credit System shall include the Farm 

Credit Banks, the Federal land bank associations, the production credit 

associations, the banks for cooperatives, and such other institutions as may be 

made a part of the System, all of which shall be chartered by and subject to 

regulation by the Farm Credit Administration.

(b) FARM CREDIT DISTRICTS.—There shall be not more than twelve 

farm credit districts in the United States, which may be designated by number, 

one of which districts shall include the Commonwealth of Puerto Rico and one of 

which districts may, if authorized by the Farm Credit Administration, include the 

Virgin Islands of the United States: Provided, that the extension of credit and 

other services authorized by this Act in the Virgin Islands of the United States 

shall be undertaken only if determined to be feasible under regulations of the 

Farm Credit Administration. The boundaries of the twelve farm credit districts 

existing on the date of enactment of this Act may be readjusted from time to time 

by the Farm Credit Administration, with the concurrence of the boards of the 

bank in each district involved. Two or more districts may be merged as provided 

in section 5.17(a)(2).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2011

Date Created: 12/13/2012

Date Modified: 2/15/2018

TITLE I—FARM CREDIT BANKS

12 U.S.C. 2011 SEC. 1.3. ESTABLISHMENT, CHARTERS, TITLES, BRANCHES.

(a) ESTABLISHMENT. The banks established pursuant to the merger 

of each District Federal Intermediate Credit Bank and Federal Land Bank 

(hereinafter referred to in this title as "Farm Credit Banks"), as provided in 

section 410 of the Agricultural Credit Act of 1987, shall be Federally chartered 

instrumentalities of the United States.

(b) CHARTERS. The Farm Credit Administration shall, consistent with 

this Act, issue charters for, and approve amendments to charters of, the Farm 

Credit Banks.

(c) TITLE. Each Farm Credit Bank may include in its title the name of 

the city in which it is located or other geographical designation.

(d) BRANCHES. Each Farm Credit Bank may establish such branches 

or other offices as may be appropriate for the effective operation of its business.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2012

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2012 SEC. 1.4. BOARD OF DIRECTORS.

Each Farm Credit Bank shall elect a board of directors of such number, for 

such term, in such manner, and with such qualifications, as may be required in its 

bylaws, except that, at least one member shall be elected by the other directors, 

which member shall not be a director, officer, employee, or stockholder of a 

System institution.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2013

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2013 SEC. 1.5. GENERAL CORPORATE POWERS.

Each Farm Credit Bank shall be a body corporate and, subject to regulation 

by the Farm Credit Administration, shall have power to—

(1) adopt and use a corporate seal;

(2) have succession until dissolved under the provisions of this 

Act or other Act of Congress;

(3) make contracts;

(4) sue and be sued;

(5) acquire, hold, dispose, and otherwise exercise all the usual 

incidents of ownership of real and personal property necessary or 

convenient to its business;

(6) make, participate in, and discount loans, make commitments 

for credit, accept advance payments, and provide services as authorized in 

this Act, and charge fees for such;

(7) operate under the direction of its board of directors;

(8) provide by its board of directors for a president, one or more 

vice presidents, a secretary, a treasurer, and provide for such other officers, 

employees, and agents as may be necessary, as provided in this Act, define 

their duties, and require surety bonds or make other provision against 

losses occasioned by employees;

(9) prescribe, by its board of directors, its bylaws that shall be 

consistent with law, and that shall provide for—

(A) the classes of its stock and the manner in which such 

stock shall be issued, transferred, and retired; and 

(B) the manner in which it is to—

(i) select officers, employees, and agent

(ii) acquire, hold, and transfer property;

(iii) make loans and discounts;

(iv) conduct general business; and

(v) exercise and enjoy the privileges granted to it by 

law;

(10) borrow money and issue notes, bonds, debentures, or other 

obligations individually, or in concert with one or more other banks of the 

System, of such character, terms, conditions, and rates of interest as may be 

determined as provided for in this Act;

(11) purchase nonvoting stock in, or pay in surplus to, and accept 

deposits of securities or funds from associations in its district, and pay 

interest on such funds;

(12) participate with—
(A) one or more other Farm Credit Banks in loans under this 

title on such terms as may be agreed on among such banks;

(B) one or more other Farm Credit System institutions in 

loans made under this title or other titles on the basis prescribed in 

section 4.18; and

(C) lenders that are not Farm Credit System institutions in 

loans that the bank is authorized to make under this title;

(13) approve the salary scale of the officers and employees of the 

associations in its district and supervise the exercise by such associations 

of the functions vested in or delegated to them;

(14) deposit the securities and current funds of the bank with any 

member bank of the Federal Reserve System or any insured State 

nonmember bank (within the meaning of section 3 of the Federal Deposit 

Insurance Act (12 U.S.C. 1813)) and pay fees and receive interest on such 

as may be agreed, and when designated for that purpose by the Secretary of 

the Treasury, such bank—

(A) shall be a depository of public money, except receipts 

from customs, under such regulations as may be prescribed by the 

Secretary;

(B) may be employed as a fiscal agent of the Government; 

and

(C) shall perform all such reasonable duties as a depository 

of public money or financial agent of the Government as may be 

required of such bank;

except that no Government funds deposited under the provisions of this 

paragraph shall be invested in loans or bonds or other obligations of the bank;

(15) buy and sell obligations of, or insured by, the United States or 

any agency thereof, or securities backed by the full faith and credit of any 

such agency, and make other investments as may be authorized under 

regulations issued by the Farm Credit Administration;

(16) sell to lenders that are not Farm Credit System institutions 

interests in loans, and buy from and sell to Farm Credit System institutions 

interests in loans and other extensions of credit, and nonvoting stock as 

may be authorized under regulations issued by the Farm Credit 

Administration;

(17) conduct studies and make and adopt standards for lending;

(18) delegate to associations such functions as the bank determines 

appropriate;

(19) amend and modify loan contracts, documents, and payment 

schedules, and release, subordinate, or substitute security for any of such 

items;

(20) for loans made by the bank, require associations to endorse 

notes and other obligations of borrowers from the bank;

(21) exercise through the board of directors or authorized officers, 

employees, or agents of the bank, all such incidental powers as may be 

necessary or expedient to carry on the business of the bank;

(22) accept contributions to the capital of the bank from 

associations and account for such in accordance with generally accepted 

accounting principles, except as may be authorized by the Farm Credit 

Administration;
(23) as may be authorized by the board of directors of the bank, 

agree with other Farm Credit System institutions to share loan and other 

losses, whether to protect against capital impairment or for any other 

purpose; and

(24) operate as an originator and become certified as a certified 

facility under title VIII.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2014

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2014 SEC. 1.6. FARM CREDIT BANK CAPITALIZATION.

In accordance with section 4.3A, the Farm Credit Banks shall provide, 

through bylaws and subject to Farm Credit Administration regulations, for the 

capitalization of the bank and the manner in which bank stock shall be issued, 

held, transferred, and retired and bank earnings distributed.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2015

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2015 SEC. 1.7. LENDING AUTHORITY.

(a) REAL ESTATE LOANS AND RELATED ASSISTANCE.

(1) REAL ESTATE LOANS. The Farm Credit Banks may make 

or participate with other lenders in long-term real estate mortgage loans in 

rural areas, as defined by the Farm Credit Administration, or to producers 

or harvesters of aquatic products, and make continuing commitments to 

make such loans under specified circumstances, for a term of not less than 

5 nor more than 40 years.

(2) FINANCIAL ASSISTANCE. The Farm Credit Banks may 

provide and extend financial assistance to, and discount for, or purchase 

from, a Federal land bank association any note, draft, or other obligation

with the endorsement or guarantee of the association, the proceeds of 

which have been advanced to persons eligible and for purposes of 

financing by the association, as authorized under section 7.6(a).

(b) INTERMEDIATE CREDIT.

(1) IN GENERAL. The Farm Credit Banks are authorized to 

make loans and extend other similar financial assistance to and to discount 

for or purchase from—

(A) any production credit association, or

(B) any national bank, State bank, trust company, 

agricultural credit corporation, incorporated livestock loan company, 

savings institution, credit union, or any association of agricultural 

producers engaged in the making of loans to farmers and ranchers, 

and any corporation engaged in the making of loans to producers or 

harvesters of aquatic products,

any note, draft, or other obligation with the institution's endorsement or 

guarantee, the proceeds of which note, draft, or other obligation have been

advanced to persons and for purposes eligible for financing by production 

credit associations as authorized by this Act.

(2) PARTICIPATION WITH OTHER ENTITIES. The Farm 

Credit Banks may participate with one or more production credit 

associations or other Farm Credit Banks in the making of loans to eligible 

borrowers and may participate with one or more other Farm Credit System 

institutions in loans made under this title or other titles of this Act on the 

basis prescribed in section 4.18 of this Act. 

(3) LIMITATIONS ON EXTENSION OF FINANCIAL 

SERVICES. 

(A) GENERAL RULE. No paper shall be purchased from or 

discounted for, and no loans shall be made or other similar financial 
assistance extended by a Farm Credit Bank to any entity identified in 

paragraph (1)(B) of this subsection if the amount of such paper 

added to the aggregate liabilities of such entity, whether direct or 

contingent (other than bona fide deposit liabilities), exceeds ten 

times the paid-in and unimpaired capital and surplus of such entity or 

the amount of such liabilities permitted under the laws of the 

jurisdiction creating such institution, whichever is the lesser.

(B) LIMITATION ON NATIONAL BANK. It shall be 

unlawful for any national bank which is indebted to any Farm Credit 

Bank, on paper discounted or purchased under paragraph (1), to 

incur any additional indebtedness, if by virtue of such additional 

indebtedness its aggregate liabilities direct or contingent, will exceed 

the limitation described in subparagraph (A).

(4) FCA REGULATIONS.

(A) IN GENERAL. All of the loans, financial assistance, 

discounts and purchases authorized by this subsection shall be 

subject to regulations of the Farm Credit Administration and shall be 

secured by collateral, if any, as may be required in such regulations.

(B) REQUIREMENT OF REGULATIONS. The 

regulations shall assure that such loans, financial assistance, 

discounts, and purchases are available on a reasonable basis to any 

financing institution authorized to receive such services under 

paragraph (1)(B) of this subsection, and that—

(i) is significantly involved in lending for agricultural 

or aquatic purposes;

(ii) demonstrates a continuing need for supplementary 

sources of funds to meet the credit requirements of its 

agricultural or aquatic borrowers;

(iii) has limited access to national or regional capital 

markets; and

(iv) does not use such services to expand its financing 

activities to persons and for purposes other than those 

authorized under title II.

(C) FEES. The regulations may authorize a Farm Credit 

Bank to charge reasonable fees for any commitment to extend 

service under this section to such a financing institution.

(D) SUBSIDIARIES AND AFFILIATES. For purposes of 

this subsection, a financing institution together with the subsidiaries 

and affiliates of such may be considered as one, but such 

determination to consider such institution together with the 

subsidiaries and affiliates of such as one shall be made in the first 

instance by the bank and in the event of a denial by the bank of its 

services to a financial institution, then by the Farm Credit 

Administration on a case-by-case basis with due regard to the total 

relationship of the financing institution, its subsidiaries, and affiliates.

(5) EFFECTIVE DATE. Nothing in this section shall require 

termination of discount relationships in existence on the effective date of 

the Farm Credit Act Amendments of 1980.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2016

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2016 SEC. 1.8. INTEREST RATES AND OTHER CHARGES.

(a) IN GENERAL. Loans and discounts made by a Farm Credit Bank 

shall bear such rate or rates of interest or discount, and be on such terms and 

conditions, as may be determined by the board of directors of the bank from time 

to time.

(b) SETTING RATES AND CHARGES. In setting rates and charges, it 

shall be the objective to provide the types of credit needed by eligible borrowers 

at the lowest reasonable costs on a sound business basis taking into consideration 

the cost of money to the bank, necessary reserve and expenses of the bank and 

associations, and providing services to members. The loan documents or 

discounting and financing agreements, may provide for the interest rate or rates 

to vary from time to time during the repayment period of the loan or agreement.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2017

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2017 SEC. 1.9. ELIGIBILITY.

The credit and financial services authorized in this title may be made 

available to persons who are or become stockholders or members of the bank or 

associations in the district, and who are—

(1) bona fide farmers, ranchers, or producers or harvesters of 

aquatic products;

(2) persons furnishing to farmers and ranchers farm-related 

services directly related to their on-farm operating needs; or

(3) owners of rural homes.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2018

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2018 SEC. 1.10. SECURITY; TERMS.

(a) REAL ESTATE LOANS.

(1) MAXIMUM LEVEL OF LOANS.

(A) IN GENERAL. Real estate mortgage loans originated 

by a Farm Credit Bank, or in which a Farm Credit Bank participates 

in with a lender that is not a System institution, shall not exceed 85 

percent of the appraised value of the real estate security, except as 

provided for in subparagraphs (C) and (D).

(B) REGULATION. The Farm Credit Administration may, 

by regulation, require that loans not exceed 75 percent of the 

appraised value of the real estate security.

(C) GUARANTEED LOANS. If the loan is guaranteed by 

Federal, State, or other governmental agencies, the loan may not 

exceed 97 percent of the appraised value of the real estate security, 

as may be authorized under regulations of the Farm Credit 

Administration.

(D) PRIVATE MORTGAGE INSURANCE. A loan on 

which private mortgage insurance is obtained may exceed 85 percent 

of the appraised value of the real estate security to the extent that the 

loan amount in excess of such 85 percent is covered by the insurance.

(2) SECURITY. All loans originated or participated in by a bank 

under this section shall be secured by first liens on interests in real estate of 

such classes as may be prescribed by regulations of the Farm Credit 

Administration.

(3) VALUE OF SECURITY. To adequately secure the loan, the 

value of security shall be determined by appraisal under standards 

prescribed by the bank in accordance with regulations of the Farm Credit 

Administration.

(4) ADDITIONAL SECURITY. Additional security of any loan 

may be required by the bank to supplement real estate security. Credit 

factors, other than the ratio between the amount of the loan and the security 

value, shall be given due consideration.

(b) INTERMEDIATE CREDIT. Loans, other than real estate loans, and 

discounts made under the provisions of this title shall be repayable in not more 

than 7 years (15 years if made to producers or harvesters of aquatic products) 

from the time that such are made or discounted by the Farm Credit Bank, except 

that the Board of Directors, under regulations of the Farm Credit Administration, 

may approve policies permitting loans, advances, or discounts (other than those 
made to producers or harvesters of aquatic products) to be repayable in not more 

than 10 years from the time that such are made or discounted by such bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2019

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2019 SEC. 1.11. PURPOSES FOR EXTENSIONS OF CREDIT.

(a) AGRICULTURAL OR AQUATIC PURPOSES.

(1) IN GENERAL. Loans made by a Farm Credit Bank to farmers, 

ranchers, and producers or harvesters of aquatic products may be for any 

agricultural or aquatic purpose and other credit needs of the applicant, 

including financing for basic processing and marketing directly related to 

the applicant's operations and those of other eligible farmers, ranchers, and 

producers or harvesters of aquatic products, except that the operations of 

the applicant shall supply some portion of the total processing or marketing 

for which financing is extended.

(2) LIMITATION ON LOANS FOR BASIC PROCESSING AND 

MARKETING OPERATIONS. The aggregate of the financing provided 

by any Farm Credit Bank for basic processing and marketing directly 

related to the operations of farmers, ranchers, and producers or harvesters 

of aquatic products, if the operations of the applicant supply less than 20 

percent of the total processing or marketing for which financing is 

extended, shall not exceed 15 percent of the total of all outstanding loans of 

such bank.

(b) RURAL HOUSING FINANCING.

(1) IN GENERAL. Loans and discounts may be made to rural 

residents for rural housing financing under regulations of the Farm Credit 

Administration.

(2) LIMITATIONS. Rural housing financed under this title shall 

be for single-family, moderate-priced dwellings and their appurtenances 

not inconsistent with the general quality and standards of housing existing 

in, or planned or recommended for, the rural area where it is located, 

except that a Farm Credit Bank may not at any one time have a total 

amount of loans outstanding for such rural housing to persons other than 

farmers or ranchers in amounts exceeding 15 percent of the total of all 

loans outstanding in such bank.

(3) RURAL AREAS. For rural housing purposes under this 

section the term "rural areas" shall not be defined to include any city or 

village having a population in excess of 2,500 inhabitants.

(c) FARM-RELATED SERVICES.

(1) IN GENERAL. Loans to persons furnishing farm-related 

services to farmers and ranchers directly related to their on-farm operating 

needs may be made for the necessary capital structures and equipment and 

initial working capital for such services.
(2) FACILITIES. The banks may own and lease, or lease with 

option to purchase, to persons eligible for credit under this title or title II, 

equipment or facilities needed in the operations of such persons.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2020

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2020 SEC. 1.12. RELATED SERVICES.

(a) IN GENERAL. The Farm Credit Banks may provide technical 

assistance to borrowers, members, and applicants from the bank and associations 

in the district, including persons obligated on paper discounted by the bank, and 

may make available to them at their option such financial related services 

appropriate to their on-farm and aquatic operations as determined to be feasible 

by the board of directors of the bank, under regulations of the Farm Credit 

Administration.

(b) AUTHORITY TO PASS ALONG COST OF INSURANCE 

PREMIUMS. 

(1) IN GENERAL.--Each Farm Credit Bank may assess each 

production credit association, other association making direct loans under 

the authority provided under section 7.6, and other financing institution 

described in section 1.7(b)(1)(B) in the district in which the bank is located 

to cover the costs of making premium payments under part E of title V. 

(2) COMPUTATION.--The assessment on any association or other 

financing institution described in paragraph (1) for any period shall be 

computed in an equitable manner, as determined by the Corporation.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2021

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2021 SEC. 1.13. LOANS THROUGH ASSOCIATIONS OR AGENTS.

(a) IN GENERAL. The Farm Credit Banks shall, except as otherwise 

herein provided, make loans of the type authorized under section 1.7(a) through a 

Federal land bank association chartered to serve the territory in which the real 

estate of the borrower is located.

(b) NO ACTIVE ASSOCIATION. If there is no active association 

chartered to serve territory where the real estate is located, the bank may make 

the loan directly or through such bank or trust company or savings or other 

financial institution as such bank may designate.

(c) PURCHASE OF STOCK REQUIRED. When the loan is not made 

through a Federal land bank association, the applicant shall purchase stock in the 

bank in accordance with the capitalization requirements provided for in the 

bylaws of the bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2022

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2022 SEC. 1.14. LIENS ON STOCK.

The Farm Credit Banks shall have a first lien on the stock or participation 

certificates it issues for the payment of any liability of the stockholders to the 

bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title I Farm Credit Banks

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2023

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2023 SEC. 1.15. TAXATION.

The Farm Credit Banks and the capital, reserves, and surplus thereof, and 

the income derived therefrom, shall be exempt from Federal, State, municipal, 

and local taxation, except taxes on real estate held by a Farm Credit Bank to the 

same extent, according to its value, as other similar property held by other 

persons is taxed. The mortgages held by the Farm Credit Banks and the notes, 

bonds, debentures, and other obligations issued by the banks shall be considered 

and held to be instrumentalities of the United States and, as such, they and the 

income therefrom shall be exempt from all Federal, State, municipal, and local 

taxation, other than Federal income tax liability of the holder thereof under the 

Public Debt Act of 1941 (31 U.S.C. 3124).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle A Production Credit Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2071

Date Created: 12/13/2012

Date Modified: 2/15/2018

TITLE II—FARM CREDIT ASSOCIATIONS

Subtitle A—Production Credit Associations

12 U.S.C. 2071 SEC. 2.0. ORGANIZATION AND CHARTERS.

(a) CHARTER. Each production credit association shall continue as a 

Federally chartered instrumentality of the United States.

(b) ORGANIZATION.

(1) IN GENERAL. Production credit associations may be 

organized by 10 or more farmers or ranchers or producers or harvesters of 

aquatic products desiring to borrow money under the provisions of this 

subtitle.

(2) ARTICLES OF ASSOCIATION. The proposed articles of 

association shall be forwarded to the Farm Credit Bank for the district 

accompanied by an agreement to subscribe on behalf of the association for 

stock in the bank in such amounts as may be required by the bank.

(3) CONTENTS OF ARTICLES. The articles shall specify in 

general terms the—

(A) objects for which the association is formed;

(B) powers to be exercised by the association in carrying out 

the functions authorized by this subtitle; and

(C) territory the association proposes to serve.

(4) SIGNATURES. The articles shall be signed by persons 

desiring to form such an association and shall be accompanied by a 

statement signed by each such person establishing eligibility to borrow 

from the association in which such person will become a stockholder.

(5) COPY TO FCA. A copy of the articles of association shall be 

forwarded to the Farm Credit Administration with the recommendations of 

the bank concerning the need for such an association in order to adequately 

serve the credit needs of eligible persons in the proposed territory and 

whether that territory includes any area described in the charter of another 

production credit association.

(6) DENIAL OF CHARTER. The Farm Credit Administration for 

good cause shown may deny the charter.

(7) APPROVAL OF ARTICLES. On approval of the proposed 

articles by the Farm Credit Administration, and on the issuance of a charter, 

the association shall become as of such date a federally chartered body 

corporate and an instrumentality of the United States.
(8) POWERS OF FCA. The Farm Credit Administration shall 

have the power, under rules and regulations prescribed by the Farm Credit 

Administration or by prescribing in the terms of the charter, to—

(A) provide for the organization of the association;

(B) provide for the initial amount of stock of the association;

(C) provide for the territory within which the association's 

operations may be carried on; and

(D) approve amendments to the charter of the association.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle A Production Credit Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2072

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2072 SEC. 2.1. BOARD OF DIRECTORS.

Each production credit association shall elect from the voting members of 

such association, a board of directors of such number, for such terms, with such 

qualifications, and in such manner as may be required by the bylaws of the 

association, except that at least one member shall be elected by the other 

directors, which member shall not be a director, officer, employee, stockholder, 

or agent of a System institution.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle A Production Credit Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2073

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2073 SEC. 2.2. GENERAL CORPORATE POWERS.

Each production credit association shall be a body corporate and, subject to 

supervision by the Farm Credit Bank for the district and regulation by the Farm 

Credit Administration, shall have the power to—

(1) have succession until terminated in accordance with this Act or 

any other Act of Congress;

(2) adopt and use a corporate seal;

(3) make contracts;

(4) sue and be sued;

(5) acquire, hold, dispose, and otherwise exercise all of the usual 

incidents of ownership of real and personal property necessary or 

convenient to the business of the association;

(6) operate under the direction of the board of directors of the 

association in accordance with the provisions of this Act;

(7) subscribe to stock of the bank;

(8) purchase stock of the bank held by other production credit 

associations and stock of other production credit associations;

(9) contribute to the capital of the bank or other production credit 

associations;

(10) invest funds of the association as may be approved by the 

Farm Credit Bank under regulations of the Farm Credit Administration and 

deposit the current funds and securities of such with the Farm Credit Bank, 

a member bank of the Federal Reserve System, or any bank insured under 

the Federal Deposit Insurance Corporation, and may pay fees therefor and 

receive interest thereon as may be agreed;

(11) buy and sell obligations of or insured by the United States or 

of any agency thereof or of any banks of the Farm Credit System and buy 

from and sell to such banks, interests in loans and in other financial 

assistance extended and nonvoting stock, as may be authorized by the Farm 

Credit Bank in accordance with regulations of the Farm Credit 

Administration;

(12) borrow money from the Farm Credit Bank, and with the 

approval of such bank, borrow from and issue notes or other obligations to

any commercial bank or other financial institution;

(13) make and participate in loans, accept advance payments, and 

provide services and other assistance as authorized in this subtitle and 

charge fees therefor, and when authorized by the bank participate with one 

or more other Farm Credit System institutions in loans made under this 
title or other titles of this Act on the basis prescribed in section 4.18 of this 

Act;

(14) endorse and become liable on loans discounted or pledged to 

the Farm Credit Bank;

(15) as may be authorized by the Farm Credit Bank in accordance 

with regulations of the Farm Credit Administration, agree with other Farm 

Credit System institutions to share loan or other losses, whether to protect 

against capital impairment or for any other purpose;

(16) prescribe, by its board of directors, its bylaws that shall be 

consistent with law, and that shall provide for—

(A) the classes of its stock and the manner in which such 

stock shall be issued, transferred, and retired; and

(B) the manner in which it is to—

(i) select officers and employees;

(ii) acquire, hold, and transfer property;

(iii) conduct general business; and

(iv) exercise and enjoy the privileges granted to it by 

law;

(17) provide by its board of directors for a manager or other chief 

executive officer, and provide for such other officers or employees as may 

be necessary, including joint employees as provided in this Act, define 

their duties, and require surety bonds or make other provisions against 

losses occasioned by employees, but no director shall, within one year after 

the date when such director ceases to be a member of the board, serve as a 

salaried employee of the association on the board of which he served;

(18) elect by the board of directors of the association a loan 

committee with power to approve applications for membership in the 

association and loans or participations or, with the approval of the bank, 

delegate the approval of applications for membership and loans or 

participations within specified limits to other committees or to authorized 

officers and employees of the association;

(19) perform any functions delegated to the association by the bank;

(20) exercise by the board of directors or authorized officers or 

employees of the association, all such incidental powers as may be 

necessary or expedient to carry on the business of the association; and

(21) operate as an originator and become certified as a certified 

facility under title VIII.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: Subtitle A Production Credit Associations

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2074

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2074 SEC. 2.3. PRODUCTION CREDIT ASSOCIATION 

CAPITALIZATION.

(a) IN GENERAL. In accordance with section 4.3A, each production 

credit association shall provide, through its bylaws and subject to Farm Credit 

Administration regulations, for its capitalization and the manner in which its 

stock shall be issued, held, transferred, and retired and, except as provided in 

subsection (b), its earnings distributed.

(b) APPLICATION OF EARNINGS. At the end of each fiscal year, 

each production credit association shall apply the amount of the earnings of the 

association for the fiscal year in excess of the operating expenses of the 

association (including provision for valuation reserves against loan assets in 

accordance with generally accepted accounting principles)—

(1) first, to the restoration of the impairment ( if any) of capital; 

and

(2) second, to the establishment and maintenance of the surplus 

accounts, the minimum aggregate amount of which shall be prescribed by 

the Farm Credit Bank.

(c) PATRONAGE. When the bylaws of an association so provide and 

subject to the general directions of the Farm Credit Administration, available net 

earnings at the end of any fiscal year may be distributed on a patronage basis in 

stock, participation certificates, or in cash. Any part of the earnings of the fiscal 

year in excess of the operating expenses for such year held in the surplus account 

may be allocated to patrons on a patronage basis.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle A Production Credit Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2075

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2075 SEC. 2.4. SHORT- AND INTERMEDIATE-TERM LOANS; 

PARTICIPATION; OTHER FINANCIAL ASSISTANCE; TERMS; 

CONDITIONS; INTEREST; SECURITY.

(a) SHORT- AND INTERMEDIATE-TERM LOANS. Each production 

credit association, under standards prescribed by the board of directors of the 

Farm Credit Bank of the district, may make, guarantee, or participate with other 

lenders in short- and intermediate-term loans and other similar financial 

assistance to—

(1) bona fide farmers and ranchers and the producers or harvesters 

of aquatic products, for agricultural or aquatic purposes and other 

requirements of such borrowers, including financing for basic processing 

and marketing directly related to the operations of the borrower and those 

of other eligible farmers, ranchers, and producers or harvesters of aquatic 

products, except that the operations of the borrower shall supply some 

portion of the total processing or marketing for which financing is 

extended, except that the aggregate of the financing provided by any 

association for basic processing and marketing directly related to the 

operations of farmers, ranchers, and producers or harvesters of aquatic 

products, if the operations of the applicant supply less than 20 percent of 

the total processing or marketing for which financing is extended, shall not 

exceed 15 percent of the total of all outstanding loans of all associations in 

the district at the end of its preceding fiscal year;

(2) rural residents for housing financing in rural areas, under 

regulations of the Farm Credit Administration; and

(3) persons furnishing to farmers and ranchers farm-related 

services directly related to their on-farm operating needs.

(b) RURAL HOUSING.

(1) IN GENERAL. Rural housing financed under this subtitle 

shall be for single-family, moderate-priced dwellings and the 

appurtenances of such not inconsistent with the general quality and 

standards of housing existing in, or planned or recommended for, the rural 

area where it is located.

(2) LIMITATION. The aggregate of such housing loans in an 

association to persons other than farmers or ranchers shall not exceed 15 

percent of the outstanding loans at the end of its preceding fiscal year 

except on prior approval by the Farm Credit Bank of the district. The 

aggregate of such housing loans in any farm credit district shall not exceed 

15 percent of the outstanding loans of all associations in the district at the 

end of the preceding fiscal year.
(3) RURAL AREAS. For rural housing purposes under this 

section the term "rural areas" shall not be defined to include any city or 

village having a population in excess of 2,500 inhabitants.

(4) EQUIPMENT. Each association may own and lease, or lease 

with option to purchase, to stockholders of the association equipment 

needed in the operations of the stockholder.

(c) INTEREST RATES AND CHARGES.

(1) IN GENERAL. Loans authorized in subsection (a) hereof 

shall bear such rate or rates of interest as are determined under standards 

prescribed by the board of the bank subject to the provisions of section 

4.17 of this Act, and shall be made upon such terms, conditions, and upon 

such security, if any, as shall be authorized in such standards.

(2) SETTING OF RATES. In setting rates and charges, it shall be 

the objective to provide the types of credit needed by eligible borrowers, at 

the lowest reasonable cost on a sound business basis, taking into account 

the cost of money to the association, necessary reserves and expenses of 

the association, and services provided to borrowers and members.

(3) VARYING RATES. The loan documents may provide for the 

interest rate or rates to vary from time to time during the repayment period 

of the loan in accordance with the rate or rates currently being charged by 

the association.

(4) PRIOR APPROVAL. Such standards may require prior 

approval of the bank on certain classes of loans, and may authorize a 

continuing commitment to a borrower of a line of credit.

(d) SPECIAL DISTRICT RULE.

(1) PROVISION OF CREDIT AND TECHNICAL ASSISTANCE 

OUTSIDE SERVICE TERRITORY. Notwithstanding any territorial 

limitation in the charter of a production credit association located in a 

district in which there are only two such associations, the Farm Credit 

Administration Board, on request of such association, may permit such 

association to provide credit and technical assistance to any borrower who 

is denied credit by the other production credit association in the district if 

the Board determines that such other production credit association in the 

district is unduly restrictive in the application of credit standards.

(2) TIMING OF DETERMINATION. If the Farm Credit 

Administration Board approves the extension of credit and technical 

assistance under paragraph (1), the association shall approve or deny the 

application for credit within 90 days after receipt of the application from 

the borrower.
Type: FCA Regulation

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle A Production Credit Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2076

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2076 SEC. 2.5. OTHER SERVICES.

Each production credit association may provide technical assistance to 

borrowers, applicants, and members and may make available to them at their 

option such financial related services appropriate to their on-farm and aquatic 

operations as is determined feasible by the board of directors of each Farm Credit 

Bank, under regulations prescribed by the Farm Credit Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle A Production Credit Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2076a

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2076a SEC 2.6. LIENS ON STOCK.

Except with regard to stock or participation certificates held by other Farm 

Credit System institutions, each production credit association shall have a first 

lien on stock and participation certificates the association issues, on allocated 

surplus, and on investments in equity reserve, for any indebtedness of the holder 

of the capital investments and, in the case of equity reserves, for charges for 

association losses in excess of reserves and surpluses.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle A Production Credit Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2077

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2077 SEC. 2.7. TAXATION.

Each production credit association and its obligations are instrumentalities 

of the United States and as such any and all notes, debentures, and other 

obligations issued by such associations shall be exempt, both as to principal and 

interest, from all taxation (except surtaxes, estate, inheritance, and gift taxes) 

now or hereafter imposed by the United States or any State, territorial, or local 

taxing authority, except that interest on such obligations shall be subject to 

Federal income taxation in the hands of the holder.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle B Federal Land Bank Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2091

Date Created: 12/13/2012

Date Modified: 2/15/2018

Subtitle B—Federal Land Bank Associations

12 U.S.C. 2091 SEC. 2.10. ORGANIZATIONS; ARTICLES; CHARTERS; POWERS 

OF THE FARM CREDIT ADMINISTRATION.

(a) CHARTER. Each Federal land bank association shall continue as a 

federally chartered instrumentality of the United States.

(b) ORGANIZATION.

(1) IN GENERAL. A Federal land bank association may be 

organized by any group of 10 or more persons desiring to borrow money 

from a Farm Credit Bank under section 1.7(a), including persons to whom 

the Farm Credit Bank has made a loan directly or through an agent and has 

taken as security real estate located in the territory proposed to be served 

by the association.

(2) ARTICLES OF ASSOCIATION.

(A) DESCRIPTION OF TERRITORY. The articles of 

association shall describe the territory within which the association 

proposes to carry on its operations.

(B) SUBMISSION TO FCB. Proposed articles shall be 

forwarded to the Farm Credit Bank for the district, accompanied by 

an agreement to subscribe on behalf of the association for stock in 

accordance with the bylaws of the Farm Credit Bank. 

(C) STOCK PURCHASE. Association stock may be paid 

for by surrendering for cancellation stock in the bank held by a 

borrower and the issuance of an equivalent amount of stock to such 

borrower in the association.

(D) STATEMENT. The articles shall be accompanied by a 

statement signed by each of the members of the proposed association 

establishing—

(i) the individual's eligibility and request for a Farm 

Credit Bank loan;

(ii) that the real estate with respect to which the 

individual desires the loan for is not being served by another 

Federal land bank association; and

(iii) that the individual is or will become a stockholder 

in the proposed association.

(E) SUBMISSION TO FCA. A copy of the articles of 

association shall be forwarded to the Farm Credit Administration 

with the recommendations of the bank concerning the need for the 

proposed association in order to adequately serve the credit needs of 
eligible persons in the proposed territory and a statement as to 

whether or not the territory includes any territory described in the 

charter of another Federal land bank association.

(3) DENIALS OF CHARTERS. The Farm Credit Administration 

for good cause shown may deny the charter applied for.

(4) APPROVAL OF ARTICLES. On the approval of the 

proposed articles by the Farm Credit Administration and the issuance of 

such charter, the association shall become as of such date a federally 

chartered body corporate and an instrumentality of the United States.

(c) FCA AUTHORITY ON ORGANIZATION. The Farm Credit 

Administration shall have power, in the terms of the charter, under rules and 

regulations prescribed by the Farm Credit Administration—

(1) to provide for the organization of the association;

(2) to provide for the initial amount of stock of the association;

(3) to provide for the territory within which the association may 

carry on its operations; and

(4) to approve amendments to the charter of such association.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle B Federal Land Bank Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2092

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2092 SEC. 2.11. BOARD OF DIRECTORS.

Each Federal land bank association shall elect from its voting shareholders 

a board of directors of such number, for such terms, in such manner, and with 

such qualifications as may be required by its bylaws except that, at least one 

member shall be elected by the other directors, which member shall not be a 

director, officer, employee, stockholder, or agent of a System institution.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle B Federal Land Bank Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2093

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2093 SEC. 2.12. GENERAL CORPORATE POWERS.

Each Federal land bank association shall be a body corporate and, subject 

to supervision of the Farm Credit Bank for the district and the regulation of the 

Farm Credit Administration, shall have the power to—

(1) adopt and use a corporate seal;

(2) have succession until dissolved under the provisions of this 

Act or other Act of Congress;

(3) make contracts;

(4) sue and be sued;

(5) acquire, hold, dispose, and otherwise exercise all of the usual 

incidents of ownership of real estate and personal property necessary or 

convenient to the business of the association;

(6) operate under the direction of the board of directors of the 

association in accordance with this Act;

(7) provide by its board of directors for a manager or other chief 

executive officer, and provide for such other officers or employees as may 

be necessary, including joint employees as provided in this Act, define the 

duties of such, and require surety bonds or make other provision against 

losses occasioned by employees, except that no director shall, within one 

year after the date when such director ceases to be a member of the board, 

serve as a salaried employee of the association on the board of which such 

director served;

(8) prescribe, by its board of directors, its bylaws that shall be 

consistent with law, and that shall provide for—

(A) the classes of its stock and the manner in which such 

stock shall be issued, transferred, and retired; and 

(B) the manner in which it is to—

(i) select officers and employees;

(ii) acquire, hold, and transfer property;

(iii) conduct general business; and

(iv) exercise and enjoy the privileges granted to it by 

law;

(9) accept applications for Farm Credit Bank loans and receive 

from such bank and disburse to the borrowers the proceeds of such loans;

(10) subscribe to stock of the Farm Credit Bank of the district;

(11) elect by its board of directors a loan committee with power to 

elect applicants for membership in the association and recommend loans to 

the Farm Credit Bank, or with the approval of the Farm Credit Bank, 

delegate the election of applicants for membership and the approval of 
loans within specified limits to other committees or to authorized 

employees of the association;

(12) on agreement with the bank, take such additional actions with 

respect to applications and loans and perform such functions as are vested 

by law in the Farm Credit Banks as may be agreed to by the association;

(13) endorse and become liable to the bank on loans it makes to 

association members;

(14) receive such compensation and deduct such sums from loan 

proceeds with respect to each loan as may be agreed between the 

association and the bank and make such other charges for services as may 

be approved by the bank;

(15) provide technical assistance to members, borrowers applicants, 

and other eligible persons and make available to them, at their option, such 

financial related services appropriate to their operations as it determines, 

with Farm Credit Bank approval, are feasible, under regulations of the 

Farm Credit Administration;

(16) borrow money from the bank and, with the approval of such 

bank, borrow from and issue association notes or other obligations to any 

commercial bank or other financial institution;

(17) buy and sell obligations of or insured by the United States or 

any agency thereof or any banks of the Farm Credit System;

(18) invest association funds in such obligations as may be 

authorized in regulations of the Farm Credit Administration and approved 

by the bank and deposit securities and current funds of the association with 

any member bank of the Federal Reserve System, with the Farm Credit 

Bank, or with any bank insured by the Federal Deposit Insurance 

Corporation, and pay fees therefor and receive interest thereon as may be 

agreed;

(19) perform such other function delegated to the association by the 

Farm Credit Bank of the district;

(20) exercise by its board of directors or authorized officers or 

agents all such incidental powers as may be necessary or expedient in the 

conduct of its business; 

(21) contribute to the capital of the bank; and

(22) operate as an originator and become certified as a certified 

facility under title VIII.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle B Federal Land Bank Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2094

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2094 SEC. 2.13. FEDERAL LAND BANK ASSOCIATION 

CAPITALIZATION.

In accordance with section 4.3A, the Federal land bank association shall 

provide, through its bylaws and subject to Farm Credit Administration 

regulations, for its capitalization and the manner in which its stock shall be issued, 

held, transferred, and retired and its earning distributed.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle B Federal Land Bank Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2096

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2096 SEC. 2.14. AGREEMENTS FOR SHARING GAINS OR LOSSES.

Each Farm Credit Bank may enter into agreements with Federal land bank 

associations in its district for sharing the gain or losses on loans or on security 

held therefor or acquired in liquidation thereof, and associations are authorized to 

enter into any such agreements and also, subject to bank approval, agreements 

with other associations in the district for sharing the risk of loss on loans 

endorsed by each such association. As may be authorized by the bank in 

accordance with regulations of the Farm Credit Administration, associations also 

may enter into agreements with other Farm Credit System institutions to share 

loan and other losses, whether to protect against capital impairment or for any 

other purpose.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle B Federal Land Bank Associations

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2097 SEC. 2.15. LIENS ON STOCK.

Each Federal land bank association shall have a first lien on the stock and 

participation certificates it issues, except on stock or participation certificates 

held by other Farm Credit System institutions, for the payment of any liability of 

the stockholder to the association or to the bank, or to both of them.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title II Farm Credit Associations

Part: [Part]

Subtitle: Subtitle B Federal Land Bank Associations

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2098

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2098 SEC. 2.16. TAXATION.

Each Federal land bank association and the capital, reserves, and surplus 

thereof, and the income derived therefrom, shall be exempt from Federal, State, 

municipal, and local taxation, except taxes on real estate held by a Federal land 

bank association to the same extent, according to its value, as other similar 

property held by other persons is taxed. The mortgages held by the Federal land 

bank associations and the notes, bonds, debentures, and other obligations issued 

by the associations shall be considered and held to be instrumentalities of the 

United States and, as such, they and the income therefrom shall be exempt from 

all Federal, State, municipal, and local taxation, other than Federal income tax 

liability of the holder thereof under the Public Debt Act of 1941 (31 U.S.C. 3124).
Type: FCA Regulation

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2121

Date Created: 12/13/2012

Date Modified: 2/15/2018

TITLE III—BANKS FOR COOPERATIVES

Part A—Banks for Cooperatives

12 U.S.C. 2121 SEC. 3.0. ESTABLISHMENT; TITLES; BRANCHES.

The banks for cooperatives established pursuant to sections 2 and 30 of the 

Farm Credit Act of 1933, as amended, shall continue as federally chartered 

instrumentalities of the United States. The Farm Credit Administration shall 

approve amendments consistent with this Act to charters and organizational 

certificates of banks for cooperatives. Unless an existing bank for cooperatives is 

merged with another bank, there shall be a bank for cooperatives in each farm 

credit district and a Central Bank for Cooperatives. A bank for cooperatives may 

include in its title the name of the city in which it is located or other geographical 

designation. The Central Bank for Cooperatives may be located in such place as 

its board of directors may determine with the approval of the Farm Credit 

Administration. When authorized by the Farm Credit Administration each bank 

for cooperatives may establish such branches or other offices as may be 

appropriate for the effective operation of its business.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2122

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2122 SEC. 3.1. CORPORATE EXISTENCE; GENERAL CORPORATE 

POWERS.

Each bank for cooperatives shall be a body corporate and, subject to 

regulation by the Farm Credit Administration, shall have power to—

(1) Adopt and use a corporate seal.

(2) Have succession until dissolved under the provisions of this 

Act or other Act of Congress.

(3) Make contracts.

(4) Sue and be sued.

(5) Acquire, hold, dispose, and otherwise exercise all of the usual 

incidents of ownership of real and personal property necessary or 

convenient to its business.

(6) Make loans and commitments for credit, provide services and 

other assistance as authorized in this Act, and charge fees therefor.

(7) Operate under the direction of its board of directors.

(8) Elect by its board of directors a president, any vice presidents, 

a secretary, a treasurer, and provide for such other officers, employees, and 

agents as may be necessary, including joint employees as provided in this 

Act, define their duties and require surety bonds or make other provisions 

against losses occasioned by employees.

(9) Prescribe by its board of directors its bylaws not inconsistent 

with law providing for the classes of its stock and the manner in which its 

stock shall be issued, transferred, and retired; its officers, employees, or 

agents elected or provided for; its property acquired, held, and transferred; 

its loans made; its general business conducted; and the privileges granted it 

by law exercised and enjoyed.

(10) Borrow money and issue notes, bonds, debentures, or other 

obligations individually or in concert with one or more other banks of the 

System, of such character, and such terms, conditions, and rates of interest 

as may be determined.

(11)(A) Participate in loans under this title with one or more other 

banks for cooperatives and with commercial banks and other financial 

institutions upon such terms as may be agreed among them and participate 

with one or more other Farm Credit System institutions in loans made 

under this title or other titles of this Act on the basis prescribed in section 

4.18 of this Act.

(B)(i) Participate in any loan of a type otherwise authorized 

under this title that is made to a similar entity by any institution in 

the business of extending credit, including purchases of 
participations in loans to finance international trade transactions 

involving the sale of agricultural commodities or the products thereof, 

except that—

(I) a bank for cooperatives may not participate 

in a loan—

(aa) if the participation would cause the total amount of 

all loan participations by the bank under this subparagraph 

involving a single credit risk to exceed 10 percent of the bank's 

total capital; or

(bb) if the participation by the bank will itself equal or 

exceed 50 percent of the principal of the loan or, when taken 

together with participations in the loan by other Farm Credit 

System institutions, will cause the cumulative amount of the 

participations by all Farm Credit System institutions in the 

loan to equal or exceed 50 percent of the principal of the loan:

(II) a bank for cooperatives may not participate 

in a loan to a similar entity under this subparagraph if 

the similar entity has a loan or loan commitment 

outstanding with a Farm Credit Bank or an association 

chartered under this Act, unless agreed to by the Bank or 

association; and

(III) the cumulative amount of participations that 

a bank for cooperatives may have outstanding under this 

subparagraph at any time may not exceed 15 percent of 

the bank's total assets.

(ii) As used in this subparagraph, the term "similar 

entity" means an entity that, while not eligible for a loan under 

section 3.8, is functionally similar to an entity eligible for a 

loan under section 3.8 in that it derives a majority of its income 

from, or has a majority of its assets invested in, the conduct of 

activities functionally similar to those conducted by the entity.

(iii) As used in this subparagraph, the term 

"participate" or "participation" refers to multilender 

transactions, including syndications, assignments, loan 

participations, subparticipations, or other forms of the purchase, 

sale, or transfer of interests in loans, other extensions of credit, 

or other technical and financial assistance.

(12) Deposit its securities and its current funds with any member 

bank of the Federal Reserve System or any insured State nonmember bank 

(within the meaning of section 3 of the Federal Deposit Insurance Act (12 

U.S.C. 1813)) or, to the extent necessary to facilitate transactions which 

may be financed under section 3.7(b) of this Act, any other financial 

organization, domestic or foreign, as may be authorized by its board of 

directors, and pay fees therefor and receive interest thereon as may be 

agreed. When designated for that purpose by the Secretary of the Treasury, 

it shall be a depository of public money, except receipts from customs, 

under such regulations as may be prescribed by the Secretary; may be 

employed as a fiscal agent of the Government, and shall perform all such 

reasonable duties as a depository of public money or financial agent of the 

Government as may be required of it. No Government funds deposited 
under the provisions of this subsection shall be invested in loans or bonds 

or other obligations of the bank.

(13)(A) Buy and sell obligations of or insured by the United States or 

of any agency thereof, or securities backed by the full faith and credit of 

any such agency and make such other investments as may be authorized 

under regulations issued by the Farm Credit Administration.

(B) As may be authorized by its board of directors, buy from 

and sell to Farm Credit System institutions interests in loans and in 

other financial assistance extended and nonvoting stock.

(C) As may be authorized by its board of directors, and 

solely for the purposes of obtaining credit information and other 

services needed to facilitate transactions which may be financed 

under section 3.7(b) of this Act, invest in ownership interests in 

foreign business entities that are principally engaged in providing 

credit information to and performing such servicing functions for 

their members in connection with the members international 

activities.

(14) Conduct studies and adopt standards for lending.

(15) Amend and modify loan contracts, documents, and payment 

schedules, and release, subordinate, or substitute security for any of them.

(16) Exercise by its board of directors or authorized officers, 

employees, or agents all such incidental powers as may be necessary or 

expedient to carry on the business of the bank.

(17) As may be authorized by the board of directors, maintain credit 

balances and pay or receive fees or interest thereon, for the purpose of 

assisting in the transfer of funds to or from parties to transactions that may 

be financed under section 3.7(b) of this Act: Provided, however, That 

nothing herein shall authorize the banks for cooperatives to engage in the 

business of accepting domestic deposits.

(18) As may be authorized by its board of directors, agree with 

other Farm Credit System institutions to share loan or other losses, whether 

to protect against capital impairment or for any other purpose.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2123

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2123 SEC. 3.2. BOARD OF DIRECTORS.

(a)(1) Each bank for cooperatives not merged into the United Bank for 

Cooperatives or the National Bank for Cooperatives shall elect a board of 

directors of such number, for such term, in such manner, and with such 

qualifications as may be required in its bylaws, except that at least one member 

shall be elected by the other directors, which member shall not be a director, 

officer, employee, or stockholder of a System institution.

(2)(A) If approved by the stockholders through a bylaw amendment, 

the nomination and election of one member from a bank for cooperatives 

(other than the National Bank for Cooperatives) shall be carried out with 

each voting stockholder of a bank for cooperatives having one vote, plus a 

number of votes (or fractional part thereof) equal to—

(i) the number of stockholders eligible to vote; 

multiplied by—

(ii) the percentage (or fractional part thereof) of the 

total equity interest (including allocated, but not unallocated, 

surplus and reserves) in the bank of all stockholders held by 

the individual voting stockholder at the close of the 

immediately preceding fiscal year of the bank.

(B) The total number of votes under this paragraph shall be 

the number of voting stockholders of a bank for cooperatives 

multiplied by two.

(b) The board of directors of the Central Bank for Cooperatives shall 

consist of one member elected by the board of each bank for cooperatives, 

including the United Bank for Cooperatives if the Central Bank for Cooperatives 

is not merged into such bank, and one member appointed by the Farm Credit 

Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2124

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2124 SEC. 3.3. BANK FOR COOPERATIVES STOCK; VALUE; 

CLASSES OF STOCK; VOTING; EXCHANGE.

(a) The capital stock of each bank for cooperatives shall be in such 

amount as its board determines is required for the purpose of providing adequate 

capital to permit the bank to meet the credit needs of borrowers from the bank 

and such amounts may be increased or decreased from time to time in accordance 

with such needs.

(b) The capital stock of each bank shall be divided into shares of par 

value of $100 each and may be of such classes as the board may determine. Such 

stock may be issued in fractional shares.

(c) Voting stock may be issued or transferred to and held only by (i) 

cooperative associations eligible to borrow from the banks (ii) other categories of 

persons and entities described in sections 3.7 and 3.8 eligible to borrow from the 

bank, as determined by the bank's board of directors; and (iii) other banks for 

cooperatives, and shall not be otherwise transferred, pledged, or hypothecated 

except as consented to by the issuing bank under regulations of the Farm Credit 

Administration.

(d) Each holder of one or more shares of voting stock which is eligible 

to borrow from a bank for cooperatives shall be entitled only to one vote and 

only in the affairs of the bank in the district in which its principal office is located 

unless otherwise authorized under regulations issued by the Farm Credit 

Administration, except that if such holder has not been a borrower from the bank 

in which it holds such stock within a period of two years next preceding the date 

fixed by the Farm Credit Administration prior to the commencement of voting, it 

shall not be entitled to vote.

(e) Nonvoting investment stock may be issued in such series and in such 

amounts as may be determined by the board and may be exchanged for voting 

stock or sold or transferred to any person subject to the approval of the issuing 

bank.

(f) Participation certificates may be issued to parties to whom voting 

stock may not be issued.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2125

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2125 SEC. 3.4. DIVIDENDS.

Dividends may be payable only on nonvoting investment stock, if declared 

by the board of the directors of the bank, subject to the general direction of the 

Farm Credit Administration.
Type: FCA Regulation

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2126 

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2126 SEC. 3.5. RETIREMENT OF STOCK.

Nonvoting investment stock and participation certificates may be called for 

retirement at par. With the approval of the issuing bank, the holder may elect not 

to have the called stock or participation certificates retired in response to a call, 

reserving the right to have such stock or participation certificates included in the 

next call for retirement. Voting stock may also be retired at par, on call or on 

such revolving basis as the board may determine with due regard for its total 

capital needs: Provided, however, That all equities in the district banks issued 

or allocated with respect to the year of the enactment of this Act and prior years 

shall be retired on a revolving basis according to the year of issue with the oldest 

outstanding equities being first retired. Equities issued for subsequent years shall 

not be called or retired until equities described in the preceding sentence of this 

proviso have been retired.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2127

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2127 SEC. 3.6. GUARANTY FUND SUBSCRIPTIONS IN LIEU OF 

STOCK.

If any cooperative association is not authorized under the laws of the State 

in which it is organized to take and hold stock in a bank for cooperatives, the 

bank shall, in lieu of any requirement for stock purchase, require the association 

to pay into or have on deposit in a guaranty fund, or the bank may retain out of 

the amount of the loan and credit to the guaranty fund account of the borrower, a 

sum equal to the amount of stock which the association would otherwise be 

required to own. Each reference to stock of the banks for cooperatives in this Act 

shall include such guaranty fund equivalents. The holder of the guaranty fund 

equivalent and the bank shall each be entitled to the same rights and obligations 

with respect thereto as the rights and obligations associated with the class or 

classes of stock involved.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2128

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2128 SEC. 3.7. LENDING POWER.

(a) The banks for cooperatives are authorized to make loans and 

commitments to eligible cooperative associations and to extend to them other 

technical and financial assistance at any time (whether or not they have a loan 

from the bank outstanding), including but not limited to discounting notes and 

other obligations, guarantees, currency exchange necessary to service individual 

transactions that may be financed under subsection (b) of this section, collateral 

custody, or participation with other banks for cooperatives and commercial banks 

or other financial institutions in loans to eligible cooperatives, under such terms 

and conditions as may be determined to be feasible by the board of directors of 

each bank for cooperatives under regulations of the Farm Credit Administration. 

Such regulations may include provisions for avoiding duplication between the 

Central Bank and district banks for cooperatives. Each bank may own and lease, 

or lease with option to purchase, to stockholders eligible to borrow from the bank 

equipment needed in the operations of the stockholder and may make or 

participate in loans or commitments and extend other technical and financial 

assistance to other domestic parties for the acquisition of equipment and facilities 

to be leased to such stockholders for use in their operations in the United States.

(b)(1) A bank for cooperatives is authorized to make or participate in loans 

and commitments to, and to extend other technical and financial assistance to a 

domestic or foreign party with respect to its transactions with an association that 

is a voting stockholder of the bank for the import of agricultural commodities or 

products thereof, agricultural supplies, or aquatic products through purchases, 

sales or exchanges, if the bank for cooperatives determines, under regulations of 

the Farm Credit Administration, that the voting stockholder will benefit 

substantially as a result of such loan, commitment, or assistance.

(2)(A) A bank for cooperatives may make or participate in loans and 

commitments to, and extend other technical and financial assistance to—

(i) any domestic or foreign party for the export, 

including (where applicable) the cost of freight, of agricultural 

commodities or products thereof, agricultural supplies, or 

aquatic products from the United States under policies and 

procedures established by the bank to ensure that the 

commodities, products, or supplies are originally sourced, 

where reasonably available, from one or more eligible 

cooperative associations described in section 3.8(a) on a 

priority basis, except that if the total amount of the balances 

outstanding on loans made by a bank under this clause that—
(I) are made to finance the export of 

commodities, products, or supplies that are not originally 

sourced from a cooperative, and

(II) are not guaranteed or insured, in an amount 

equal to at least 95 percent of the amount loaned, by a 

department, agency, bureau, board, commission, or 

establishment of the United States or a corporation 

wholly-owned directly or indirectly by the United States, 

exceeds an amount that is equal to 50 percent of the 

banks capital, then a sufficient interest in the loans shall 

be sold by the bank for cooperatives to commercial 

banks and other non-System lenders to reduce the total 

amount of such outstanding balances to an amount not 

greater than an amount equal to 50 percent of the banks 

capital; and

(ii) except as provided in subparagraph (B), any 

domestic or foreign party in which an eligible cooperative 

association described in section 3.8(a) (inculding, for the 

purpose of facilitating its domestic business operations only, a 

cooperative or other entity described in section 3.8(b)(1)(A) 

has an ownership interest, for the purpose of facilitating the 

domestic or foreign business operations of the association, 

except that if the ownership interest by an eligible cooperative 

association, or associations, is less than 50 percent, the 

financing shall be limited to the percentage held in the party by 

the association or associations.

(B) A bank for cooperatives shall not use the authority 

provided in subparagraph (A)(ii) to provide financial assistance to a 

party for the purpose of financing the relocation of a plant or facility 

from the United States to another country.

(3) A bank for cooperatives is authorized to provide such services 

as may be customary and normal in maintaining relationships with 

domestic or foreign entities to facilitate the activities specified in 

paragraphs (1) and (2), consistent with this Act.

(4) DEFINITION OF AGRICULTURAL SUPPLY.--In this 

subsection, the term "agricultural supply" includes--

(A) a farm supply; and

(B)(i) agriculture-related processing equipment;

(ii) agriculture-related machinery; and

(iii) other capital goods related to the storage or 

handling of agricultural commodities or products.

(c) Loans, commitments, and assistance authorized by subsection (b) of 

this section shall be extended in accordance with policies adopted by the board of 

directors of the bank under regulations of the Farm Credit Administration.

(d) The regulations of the Farm Credit Administration implementing 

subsection (b) of this section and the other provisions of this title relating to the 

authority under subsection (b) of this section may not confer upon the banks for 

cooperatives powers and authorities greater than those specified in this title. The 

Farm Credit Administration shall, during the formulation of such regulations, 

closely consult on a continuing basis with the Board or Governors of the Federal 
Reserve System to ensure that such regulations conform to national banking 

policies, objectives, and limitations.

(e) Notwithstanding any other provision of this title, the banks for 

cooperatives shall not make or participate in loans or commitments for the 

purpose of financing speculative futures transactions by eligible borrowers in 

foreign currencies.

(f) The banks for cooperatives may, for the purpose of installing, 

maintaining, expanding, improving, or operating water and waste disposal 

facilities in rural areas, make and participate in loans and commitments and 

extending other technical and financial assistance to—

(1) cooperatives formed specifically for the purpose of 

establishing or operating such facilities; and

(2) public and quasi-public agencies and bodies, and other public 

and private entities that, under authority of State or local law, establish or 

operate such facilities.

For purposes of this subsection, the term "rural area" means all territory of a State 

that is not within the outer boundary of any city or town having a population of 

more than 20,000 based on the latest decennial census of the United States.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2129

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2129 SEC. 3.8. ELIGIBILITY.

(a) Any association of farmers, producers or harvesters of aquatic 

products, or any federation of such associations, which is operated on a 

cooperative basis, and has the powers for processing, preparing for market, 

handling, or marketing farm or aquatic products; or for purchasing, testing, 

grading, processing, distributing, or furnishing farm or aquatic supplies or 

furnishing farm or aquatic business services or services to eligible cooperatives 

and conforms to either of the two following requirements:

(1) no member of the association is allowed more than one vote 

because of the amount of stock or membership capital he may own therein; 

or

(2) does not pay dividends on stock or membership capital in 

excess of such per centum per annum as may be approved under 

regulations of the Farm Credit Administration; and in any case

(3) does not deal in farm products or aquatic products, or products 

processed therefrom, farm or aquatic supplies, farm or aquatic business 

services, or services to eligible cooperatives with or for nonmembers in an 

amount greater in value than the total amount of such business transacted 

by it with or for members, excluding them from the total of member and 

nonmember business transactions with the United States or any agency or 

instrumentality thereof or services or supplies furnished as a public utility; 

and

(4) a percentage of the voting control of the association not less 

than 80 per centum (60 per centum (A) in the case of rural electric, 

telephone, public utility, and service cooperatives; (B) in the case of local 

farm supply cooperatives that have historically served needs of the 

community that would not adequately be served by other suppliers and 

have experienced a reduction in the percentage of farmer membership due 

to changed circumstances beyond their control such as, but not limited to, 

urbanization of the community; and (C) in the case of local farm supply 

cooperatives that provide or will provide needed services to a community 

and that are or will be in competition with a cooperative specified in 

paragraph (B)) or, with respect to any type of association or cooperative, 

such higher percentage as established by the bank board, is held by farmers, 

producers or harvesters of aquatic products, or eligible cooperative 

associations as defined herein; 

shall be eligible to borrow from a bank for cooperatives. Any such association 

that has received a loan from a bank for cooperatives shall, without regard to the 

requirements of paragraphs (1) through (4), continue to be eligible for so long as 
more than 50 percent (or such higher percentage as is established by the bank 

board) of the voting control of the association is held by farmers, producers or 

harvesters of aquatic products, or eligible cooperative associations.

(b) Notwithstanding any other provision of this section:

(1) The following entities shall also be eligible to borrow from a 

bank for cooperatives:

(A) Cooperatives and other entities that have received a loan, 

loan commitment, or loan guarantee from the Rural Electrification 

Administration, or a loan or loan commitment from the Rural 

Telephone Bank, or that are eligible under the Rural Electrification 

Act of 1936 (7 U.S.C. 901 et seq.) for a loan, loan commitment, or 

loan guarantee from the Administration or the Bank (or a successor 

of the Administration or the Bank), and subsidiaries of such 

cooperatives or other entities.

(B) Any legal entity that (i) holds more than 50 percent of 

the voting control of an association or other entity that is eligible to 

borrow from a bank for cooperatives under subsection (a) of this 

section or subparagraph (A) of this paragraph, and (ii) borrows for 

the purpose of making funds available to that association or entity, 

and makes funds available to that association or entity under the 

same terms and conditions that the funds are borrowed from a bank 

for cooperatives.

(C) Any cooperative or other entity described in subsection 

(b) or (f) of section 3.7.

(D) Any creditworthy private entity that satisfies the 

requirements for a service cooperative under paragraphs (1), (2), and 

(4), or under the last sentence, of subsection (a) and subsidiaries of 

the entity, if the entity is organized to benefit agriculture in 

furtherance of the welfare of its farmer-members and is operated on a 

not-for-profit basis.

(2) Notwithstanding the provisions of section 3.9, the board of 

directors of a bank for cooperatives may determine that, with respect to a 

loan to any borrower eligible to borrow from a bank under paragraph (1)(A) 

that is fully guaranteed by the United States, no stock purchase requirement 

shall apply, other than the requirement that a borrower eligible to own 

voting stock shall purchase one share of such stock.

(3) Each association and other entity eligible to borrow from a bank 

for cooperatives under this subsection, for purposes of section 3.7(a), shall 

be treated as an eligible cooperative association and a stockholder eligible 

to borrow from the bank.

(4) Nothing in this subsection shall be construed to adversely affect 

the eligibility as it existed on the date of the enactment of this subsection, 

of cooperatives and other entities for any other credit assistance under 

Federal law.

NOTE: This subsection was enacted on January 6, 1988, by 

section 421 of the Agricultural Credit Act of 1987.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C.2130 

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2130 SEC. 3.9. OWNERSHIP OF STOCK BY BORROWERS.

(a) Each borrower entitled to hold voting stock shall, at the time a loan 

is made by a bank for cooperatives, own at least one share of voting stock and 

shall be required by the bank to invest in additional voting stock or nonvoting 

investment stock at that time, or from time to time, as the lending bank may 

determine, but the requirement for investment in stock at the time the loan is 

closed shall not exceed an amount equal to 10 per centum of the face amount of 

the loan. Such additional ownership requirements may be based on the face 

amount of the loan, the outstanding loan balance or on a percentage of the 

interest payable by the borrower during any year or during any quarter thereof, or 

upon such other basis as the bank determines will provide adequate capital for 

the operation of the bank and equitable ownership thereof among borrowers. In 

the case of a direct loan by the Central Bank, the borrower shall be required to 

own or invest in the necessary stock in a district bank or banks and such district 

bank shall be required to own a corresponding amount of stock in the Central 

Bank, but voting stock shall be in the one district bank designated by the Farm 

Credit Administration.

(b) Notwithstanding the provisions of subsection (a) of this section, the 

purchase of stock need not be required with respect to that part of any loan made 

by a bank for cooperatives which it sells to or makes in participation with 

financial institutions other than any of the banks for cooperatives. In such cases 

the distribution of earnings of the bank for cooperatives shall be on the basis of 

the interest in the loan retained by such bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2131

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2131 SEC. 3.10. INTEREST RATES; SECURITY; LIEN; 

CANCELLATION; AND APPLICATION ON INDEBTEDNESS.

(a) Loans made by a bank for cooperatives shall bear interest at a rate or 

rates determined by the board of directors of the bank from time to time. In 

setting rates and charges, it shall be the objective to provide the types of credit 

needed by eligible borrowers at the lowest reasonable cost on a sound business 

basis, taking into account the net cost of money to the bank, necessary reserves 

and expenses of the bank, and services provided. The loan documents may 

provide for the interest rate or rates to vary from time to time during the 

repayment period of the loan, in accordance with the rate or rates currently being 

charged by the bank.

(b) Loans shall be made upon such terms, conditions, and security, if 

any, as may be determined by the bank in accordance with regulations of the 

Farm Credit Administration.

(c) Each bank for cooperatives shall have a first lien on all stock or other 

equities in the bank as collateral for the payment of any indebtedness of the 

owner thereof to the bank. In the case of a direct loan to an eligible cooperative 

by the Central Bank, the Central Bank shall have a first lien on the stock and 

equities of the borrower in the district bank and the district bank shall have a lien 

thereon junior only to the lien of the Central Bank.

(d) In any case where the debt of a borrower is in default, or in any case 

of liquidation or dissolution of a present or former borrower from a bank for 

cooperatives, the bank may, but shall not be required to, retire and cancel all or 

part of the stock, allocated surplus or contingency reserves, or any other equity in 

the bank owned by or allocated to such borrower, at the fair market value thereof 

not exceeding par, and, to the extent required in such cases, corresponding shares 

and allocations and other equity interests held by a district bank in another 

district bank on account of such indebtedness, shall be retired or equitably 

adjusted. In no event shall the banks equities be retired or canceled if the 

retirement or cancellation would adversely affect the banks capital structure, as 

determined by the Farm Credit Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2132

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2132 SEC. 3.11. EARNINGS AND RESERVES; APPLICATION OF 

SAVINGS.

(a) At the end of each fiscal year, the net savings shall, under regulations 

prescribed by the Farm Credit Administration, continue to be applied on a 

cooperative basis with provision for sound, adequate capitalization to meet the 

changing financing needs of eligible cooperative borrowers and prudent 

corporate fiscal management, to the end that current year's patrons carry their fair 

share of the capitalization, ultimate expenses, and reserves related to the year's 

operations and the remaining net savings shall be distributed as patronage 

refunds as provided in subsections (b) and (c) of this section. Such regulations 

may provide for application of net savings to the restoration or maintenance of an 

allocated surplus account, reasonable additions to unallocated surplus, or to 

unallocated reserves after payment of operating expenses, and provide for 

allocations to patrons not qualified under the Internal Revenue Code, or payment 

of such per centum of patronage refunds in cash, as the board may determine. 

(b) The net savings of each district bank for cooperatives, after the 

earnings for the fiscal year have been applied in accordance with subsection (a) 

of this section shall be paid in stock, participation certificates, or cash, or in any 

of them, as determined by its board, as patronage refunds to borrowers to whom 

such refunds are payable who are borrowers of the fiscal year for which such 

patronage refunds are distributed. Except as provided in subsection (c) below, all 

patronage refunds shall be paid in proportion that the amount of interest and 

service fees on the loans to each borrower during the year bears to the interest 

and service fees on the loans of all borrowers during the year or on such other 

proportionate patronage basis as may be approved by the board of directors.

(c) The net savings of the Central Bank for Cooperatives after the 

earnings for the fiscal year have been applied in accordance with subsection (a) 

of this section shall be paid in stock or cash, or both, as determined by the board, 

as patronage refunds to the district banks on the basis of interests held by the 

Central Bank in loans made by the district banks and upon any direct loans made 

by the Central Bank to cooperative associations, or on such other proportionate 

patronage basis as may be approved by the board of directors. In cases of direct 

loans, such refund shall be paid to the district bank or banks which issued their 

stock to the borrower incident to such loans, and the district bank or banks shall 

issue a like amount of patronage refunds to the borrower.

(d) In the event of a net loss in any fiscal year after providing for all 

operating expenses (including reasonable valuation reserves and losses in excess 

of any applicable reserves), such loss may be carried forward or carried back, if 

appropriate, or otherwise shall be absorbed by charges to unallocated reserve or 
surplus accounts established after the date of enactment of this Act; charges to 

allocated contingency reserve account; charges to allocated surplus accounts;

charges to other contingency reserve and surplus accounts; the impairment of 

voting stock; or the impairment of all other stock.

(e) Notwithstanding any other provisions of this section any costs or 

expenses attributable to a prior year or years but not recognized in determining 

the net savings for such year or years may be charged to reserves or surplus of 

the bank or to patronage allocations for such years, as may be determined by the 

board of directors.

(f) A bank for cooperatives may pay in cash such portion of its 

patronage refunds as will permit its taxable income to be determined without 

taking into account savings applied as allocated surplus, allocated contingency 

reserves, and patronage refunds under subsection (a) of this section.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: Part A Banks for Cooperatives

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2133

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2133 SEC. 3.12. DISTRIBUTION OF ASSETS ON LIQUIDATION OR 

DISSOLUTION.

In the case of liquidation or dissolution of any bank for cooperatives, after 

payment or retirement, first, of all liabilities; second, of all capital stock issued 

before January 1, 1956, at par, and all nonvoting stock at par; and third, all voting 

stock at par; any surplus and reserves existing on January 1, 1956, shall be paid 

to the holders of stock issued before that date, and voting stock pro rata; and any 

remaining allocated surplus and reserves shall be distributed to those entities to 

which they are allocated on the books of the bank, and any other remaining 

surplus shall be paid to the holders of outstanding voting stock. If it should 

become necessary to use any surplus or reserves to pay any liabilities or to retire 

any capital stock, unallocated reserves or surplus, allocated reserves and surplus 

shall be exhausted in accordance with rules prescribed by the Farm Credit 

Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part A Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2134

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2134 SEC. 3.13. TAXATION.

Each bank for cooperatives and its obligations are instrumentalities of the 

United States and as such any and all notes, debentures, and other obligations 

issued by such bank shall be exempt, both as to principal and interest from all 

taxation (except surtaxes, estate, inheritance, and gift taxes) now or hereafter 

imposed by the United States or any State, territorial, or local taxing authority, 

except that interest on such obligations shall be subject to Federal income 

taxation in the hands of the holder.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2141

Date Created: 12/13/2012

Date Modified: 2/15/2018

Part B—United and National Banks for Cooperatives

12 U.S.C. 2141 SEC. 3.20. CHARTER, POWERS, AND OPERATION.

(a) CHARTER. The National Bank for Cooperatives or the United Bank 

for Cooperatives, as the case may be (hereinafter in this part referred to as the 

"consolidated bank"), established under section 413 of the Agricultural Credit 

Act of 1987, shall be a federally chartered instrumentality of the United States 

and an institution of the Farm Credit System.

(b) POWERS. The consolidated bank and the board of directors of such 

bank shall have all of the powers, rights, responsibilities, and obligations of the 

district banks for cooperatives and the Central Bank for Cooperatives and the 

boards of directors of such bank except as otherwise provided for in this Act.

(c) OPERATION. The consolidated bank shall be organized and operated 

on a cooperative basis.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2142

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2142 SEC. 3.21. BOARD OF DIRECTORS PROVISIONS.

(a) INITIAL BOARD OF DIRECTORS. The initial board of directors of a 

consolidated bank shall include the members of the boards of directors of the 

farm credit districts who were elected by voting stockholders of the constituent 

district banks for cooperatives (as such banks existed on the date of the 

enactment of this section) and who shall serve out the terms for which they were 

elected.

(b) PERMANENT BOARD OF DIRECTORS.

(1) COMPOSITION. The permanent board of directors of a 

consolidated bank shall consist of—

(A) three members, elected by the voting stockholders of the 

consolidated bank, from each of the Farm Credit districts that had 

been served by constituent banks, as such districts existed on the date 

of the enactment of this section, at least one of whom, from each 

such district, shall be a farmer;

(B) one member elected by the voting stockholders of each 

district bank for cooperatives that is not a constituent of the 

consolidated bank; and

(C) one member appointed by the members chosen under 

subparagraphs (A) and (B) who shall not be a stockholder or 

borrower of a System institution or an officer or director of any such 

stockholder or borrower.

(2) NOMINATION AND ELECTION. For purposes of 

nominating and electing members of the board of directors under paragraph 

(1)(A):

(A) FIRST MEMBER. The nomination and election of the 

first member from each district shall be carried out on the basis 

provided for in section 3.3(d).

(B) SECOND MEMBER.

(i) IN GENERAL. The nomination and election of 

the second member from each district shall be carried out with 

each voting stockholder of the consolidated bank located in the 

district having one vote, plus a number of votes (or fractional 

part thereof) equal to the number of stockholders eligible to 

vote in that district multiplied by the percentage (or fractional 

part thereof) of the total equity interest (including allocated, 

but not unallocated, surplus and reserves) in the consolidated 

bank of all such stockholders located in that district held by the 

individual voting stockholder—
(I) at the close of the immediately preceding 

fiscal year of the consolidated bank; or

(II) with respect to the first election held under 

this subsection, as of such date as the Farm Credit 

Administration shall prescribe.

(ii) TOTAL NUMBER OF VOTES. The total number 

of votes for each district under this subparagraph shall be the 

number of voting stockholders of the consolidated bank 

located in the district multiplied by two.

(C) THIRD MEMBER. The nomination and election of the 

third member from each district shall be carried out in accordance 

with procedures prescribed in the bylaws of the consolidated bank.

(3) TERMS.

(A) IN GENERAL. The members of the board of directors 

of the consolidated bank shall serve for a term of 3 years.

(B) TIMING OF ELECTIONS. Procedures for electing 

members of the board of directors of the consolidated bank under 

this subsection shall ensure that the beginning of the terms of such 

members coincide with the expiration of the terms of members of the 

interim board of directors of the bank under subsection (a) of this 

section.

(4) FCA REGULATIONS. The nomination and election of the 

members of the board of directors of the consolidated bank under this 

subsection shall be carried out in accordance with regulations issued by the 

Farm Credit Administration.

(c) MODIFICATION OF BOARD OF DIRECTORS PROVISIONS. 

The provisions of subsection (b) of this section relating to the board of directors 

of the consolidated bank, other than the provisions relating to the initial 

composition, nomination, and election of the members of the board, may be 

modified on an affirmative vote of at least two-thirds of the voting stockholders 

of the bank, with each such stockholder to have, for such purposes, only one vote. 

Any proposals for modifying such provisions shall be submitted for a vote by 

such stockholders in accordance with procedures prescribed by the Farm Credit 

Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2143

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2143 SEC. 3.22. CREDIT DELIVERY OFFICE.

On a determination by the board of directors of the consolidated bank that 

the banks loan portfolio is concentrated in any one district or districts (according 

to the district boundaries in effect immediately prior to the effective date of the 

establishment of the bank under section 413 of the Agricultural Credit Act of 

1987), the bank may consider the creation of regional service centers to 

accommodate such loan concentrations.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2144

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2144 SEC. 3.23. CONSOLIDATION OF FUNCTIONS.

Subject to section 3.22, to the greatest extent practicable, the functions of 

the consolidated bank shall be consolidated in the central office of the bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2145

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2145 SEC. 3.24. EXCHANGE OF OWNERSHIP INTERESTS.

On the establishment of the consolidated bank, ownership interests of the 

stockholders and subscribers to the guaranty funds of the constituent district 

banks for cooperatives (including stock, participation certificates, and allocated 

equities) shall be exchanged for like ownership interests in the consolidated bank 

on a book value basis.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2146

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2146 SEC. 3.25. CAPITALIZATION.

In accordance with section 4.3A, each consolidated bank shall provide, 

through bylaws and subject to Farm Credit Administration regulations, for the 

capitalization of the bank and the manner in which bank stock shall be issued, 

held, transferred, and retired and bank earnings distributed.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2147

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2147 SEC. 3.26. PATRONAGE POOLS.

Under such terms and conditions as may be determined by its board of 

directors, the consolidated bank may—

(1) for a period of at least 3 years following the date of the 

enactment of this section, establish separate patronage pools consisting of 

loans to eligible borrowers located in each constituent farm credit district

(as such district existed on the date of the enactment of this section); and

(2) allocate revenues, expenses, and net savings among such pools 

on an equitable basis.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2148

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2148 SEC. 3.27. TRANSACTIONS TO ACCOMPLISH MERGER.

The receipt of assets or assumption of liabilities by the consolidated bank, 

the exchange of stock, equities, or other ownership interests, and any other 

transaction carried out in accomplishing the merger of the banks for cooperatives 

shall not be treated as a taxable event under the laws of the United States or of 

any State or political subdivision thereof. The preceding sentence shall also 

apply to the receipt of assets and liabilities by a cooperative to the extent that the 

net amount of the distribution is immediately reinvested in stock of a 

consolidated bank (and in such case the basis of such stock shall be appropriately 

reduced by the amount of gain not recognized by reason of this sentence).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2149

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2149 SEC. 3.28. LENDING LIMITS.

The Farm Credit Administration may not establish lending limits for the 

consolidated bank with respect to any loans or borrowers that are more restrictive 

than the combined lending limits that were previously established by the Farm 

Credit Administration for a district bank for cooperatives and the Central Bank 

for Cooperatives with respect to such loans or borrowers.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title III Banks for Cooperatives

Part: [Part]

Subtitle: Part B United and National Banks for Cooperatives

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2149a

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2149a SEC. 3.29. REPORTS BY MERGED BANKS FOR 

COOPERATIVES.

(a) IN GENERAL. When two or more banks for cooperatives merge, 

the resulting bank shall, not later than December 31 of each year of the 

succeeding 5 years following the date of the merger, file an annual report with 

the Farm Credit Administration that—

(1) analyzes the effect of the merger;

(2) includes a breakdown of loans outstanding according to the 

size of the cooperative stockholders of the bank; and

(3) describes the adequacy of credit and other assistance services 

provided to smaller cooperatives.

(b) AVAILABILITY. A copy of the report required in subsection (a) of 

this section shall be made available to the Committee on Agriculture of the 

House of Representatives and the Committee on Agriculture, Nutrition, and 

Forestry of the Senate.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2151

Date Created: 12/13/2012

Date Modified: 2/15/2018

TITLE IV—PROVISIONS APPLICABLE TO TWO OR MORE CLASSES 

OF INSTITUTIONS OF THE SYSTEM

Part A—Funding

12 U.S.C. 2151 SEC. 4.0. REVOLVING FUND.

The revolving fund established by this section (in effect immediately 

before the date of the enactment of the Agricultural Credit Act of 1987) shall be 

available to the Farm Credit Administration and the Assistance Board during the 

periods, and for the purposes, provided for in sections 6.13 and 6.7, respectively.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C.

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2152 SEC. 4.1 [Repealed]
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2153

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2153 SEC. 4.2. POWER TO BORROW; ISSUANCE OF NOTES, BONDS, 

DEBENTURES, AND OTHER OBLIGATIONS.

Each of the banks of the System, in order to obtain funds for its authorized 

purposes, shall have power, subject to regulation by the Farm Credit 

Administration, and subject to the limitations of paragraph (e) of this section, to:

(a) Borrow money from or loan to any other institution of the System, 

borrow from any commercial bank or other lending institution, issue its notes or 

other evidence of debt on its own individual responsibility and full faith and 

credit, and invest its excess funds in such sums, at such times, and on such terms 

and conditions as it may determine.

(b) Issue its own notes, bonds, debentures, or other similar obligations 

fully collateralized as provided in section 4.3(c) by the notes, mortgages, and 

security instruments it holds in the performance of its functions under this Act in 

such sums, maturities, rates of interest, and terms and conditions of each issue as 

it may determine with approval of the Farm Credit Administration.

(c) Join with any or all banks organized and operating under the same 

title of this Act in borrowing or in issuance of consolidated notes, bonds, 

debentures, or other obligations as may be agreed with approval of the Farm 

Credit Administration.

(d) Join with other banks of the System in issuance of Systemwide notes, 

bonds, debentures, and other obligations in the manner, form, amounts, and on 

such terms and conditions as may be agreed upon with approval of the Farm 

Credit Administration. Such Systemwide issue by the participating banks and 

such participations by each bank shall not exceed the limits to which each such 

bank is subject in the issuance of its individual or consolidated obligations and 

each such issue shall be subject to approval of the Farm Credit Administration: 

Provided, however, There shall be no issues of Systemwide obligations without 

the concurrence of the boards of directors of each bank and the approval of the 

Farm Credit Administration for such issues shall be conditioned on and be 

evidence of the compliance with this provision.

(e) No bank or banks shall issue notes, bonds, debentures, or other 

obligations individually or in concert with one or more banks of the System other 

than through the Federal Farm Credit Banks Funding Corporation under any 

provision of this Act except under subsection (a) of this section: Provided, That 

any bank or banks may issue investment bonds or like obligations other than 

through the Federal Farm Credit Banks Funding Corporation if the interest rate is 

not in excess of the interest allowable on savings deposits of commercial banks 
of comparable amounts and maturities under Federal Reserve regulation on its 

member banks.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2154

Date Created: 12/13/2012

Date Modified: 2/15/2018

12 U.S.C. 2154 SEC. 4.3. CAPITAL ADEQUACY OF BANKS AND 

ASSOCIATIONS.

(a) The Farm Credit Administration shall cause System institutions to 

achieve and maintain adequate capital by establishing minimum levels of capital 

for such System institutions and by using such other methods as the Farm Credit 

Administration deems appropriate. The Farm Credit Administration may 

establish such minimum level of capital for a System institution as the Farm 

Credit Administration, in its discretion, deems to be necessary or appropriate in 

light of the particular circumstances of the System institution.

(b)(1) Failure of a System institution to maintain capital at or above its 

minimum level as established under subsection (a) of this section may be deemed 

by the Farm Credit Administration, in its discretion, to constitute an unsafe and 

unsound practice within the meaning of this Act.

(2) In addition to, or in lieu of, any other action authorized by law, 

including paragraph (1), the Farm Credit Administration may issue a 

directive to a System institution that fails to maintain capital at or above its 

required level as established under subsection (a) of this section. Such 

directive may require the System institution to submit and adhere to a plan 

acceptable to the Farm Credit Administration describing the means and 

timing by which the System institution shall achieve its required capital 

level, but may not require merger or consolidation without a majority vote 

of the voting stockholders or the contributors to the guaranty fund of the 

institution.

(3) The Farm Credit Administration may consider such System 

institutions progress in adhering to any plan required under paragraph (2) 

whenever such System institution, or an affiliate thereof, seeks the requisite 

approval of the Farm Credit Administration for any proposal that would 

divert earnings, diminish capital, or otherwise impede such System 

institutions progress in achieving its minimum capital level. The Farm 

Credit Administration may deny such approval where it determines that 

such proposal would adversely affect the ability of the System institution to 

comply with such plan.

(c) Each bank shall have on hand at the time of issuance of any note, 

bond, debenture, or other similar obligation and at all times thereafter maintain, 

free from any lien or other pledge, notes and other obligations representing loans 

made under this Act or real or personal property acquired in connection with 
loans made under this Act, obligations of the United States or any agency thereof 

direct or fully guaranteed, other bank assets (including marketable securities) 

approved by the Farm Credit Administration, or cash, in an aggregate value equal 

to the total amount of notes, bonds, debentures, or other similar obligations 

outstanding for which the bank is primarily liable.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2154a

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2154a SEC. 4.3A. CAPITALIZATION OF SYSTEM INSTITUTIONS.

(a) DEFINITIONS. As used in this section:

(1) PERMANENT CAPITAL. The term "permanent capital" 

means—

(A) current year retained earnings;

(B) allocated and unallocated earnings (which, in the case of 

earnings allocated in any form by a System bank to any association 

or other recipient and retained by the bank, shall be considered, in 

whole or in part, permanent capital of the bank or of any such 

association or other recipient as provided under an agreement 

between the bank and each such association or other recipient);

(C) all surplus (less allowances for losses);

(D) stock issued by a System institution, except—

(i) stock that may be retired by the holder of the stock 

on repayment of the holder's loan, or otherwise at the option or 

request of the holder; or

(ii) stock that is protected under section 4.9A or is 

otherwise not at risk; and 

(E) any other debt or equity instruments or other accounts 

that the Farm Credit Administration determines appropriate to be 

considered permanent capital.

(2) STOCK. The term "stock" means voting and nonvoting stock 

(including preferred stock), equivalent contributions to a guaranty fund, 

participation certificates, allocated equities, and other forms and types of 

equities.

(b) ADOPTION OF BYLAWS. Subject to approval by shareholders 

under subsection (c)(2) of this section, each bank and association shall adopt 

bylaws, developed by its board of directors, that provide for the capitalization of 

the institution in accordance with subsection (c)(1) of this section.

(c) REQUIREMENTS OF BYLAWS.

(1) IN GENERAL. Notwithstanding any other provision of this 

Act, the bylaws adopted under subsection (b) of this section—

(A) shall provide for such classes, par value, and amounts of 

the stock of the institution, the manner in which such stock shall be 

issued, transferred, and retired, and the payment of dividends and 
patronage refunds, as determined appropriate by the Board of 

Directors, subject to this section;

(B) may provide for the charging of loan origination fees as 

determined appropriate by the Board of Directors;

(C) shall enable the institution to meet the capital adequacy 

standards established under the regulations issued under section 

4.3(a);

(D) shall provide for the issuance of voting stock, which may 

only be held by—

(i) borrowers who are farmers, ranchers, or producers 

or harvesters of aquatic products, and cooperative associations 

eligible to borrow from System institutions under this Act;

(ii) persons and entities eligible to borrow from the 

banks for cooperatives, as described in section 3.3(c)(ii); 

(iii) in the case of a Central Bank for Cooperatives, 

other banks for cooperatives; and

(iv) in the case of banks other than banks for 

cooperatives, System associations;

(E) shall require that—

(i) as a condition of borrowing from or through the 

institution, any borrower who is entitled to hold voting stock or 

participation certificates shall, at the time a loan is made, 

acquire voting stock or participation certificates in an amount 

not less than $1,000 or 2 percent of the amount of the loan, 

whichever is less; and

(ii) within 2 years after the loan of a borrower is 

repaid in full, any voting stock held by the borrower be 

converted to nonvoting stock;

(F) may provide that persons who are not borrowers from 

the institution may hold nonvoting stock of the institution;

(G) shall require that any holder of voting stock issued 

before the adoption of bylaws under this section exchange a portion 

of such stock for new voting stock;

(H) do not need to provide for maximum or minimum 

standards of borrower stock ownership based on a percentage of the 

loan of the borrower, except as otherwise provided in this section;

(I) shall permit the retirement of stock at the discretion of 

the institution if the institution meets the capital adequacy standards 

established under section 4.3(a); and

(J) shall permit stock to be transferable.

(2) EFFECTIVE DATE. The bylaws adopted by the board of 

directors of a System institution under subsection (b) of this section shall 

take effect only on approval of a majority of the stockholders of such 

institution present and voting, or voting by written proxy, at a duly 

authorized stockholder's meeting.

(d) REDUCTION OF CAPITAL.

(1) GENERAL RULE. Except as provided in paragraph (2), the 

board of directors of a System institution may not reduce the permanent 

capital of the institution through the payment of patronage refunds or 

dividends, or the retirement of stock if, after or due to such action, the 
permanent capital of the institution would thereafter fail to meet the 

minimum capital adequacy standards established under section 4.3(a).

(2) EXCEPTIONS. Paragraph (1) shall not apply to the payment 

of noncash patronage refunds by any institution exempt from Federal 

income tax if the entire refund paid qualifies as permanent capital. 

Notwithstanding paragraph (1), any System institution subject to Federal 

income tax may pay patronage refunds partially in cash as long as the cash 

portion of the refund is the minimum amount required to qualify the refund 

as a deductible patronage distribution for Federal income tax purposes and 

the remaining portion of the refund paid qualifies as permanent capital.

(e) COMPLIANCE. The Farm Credit Administration may issue a 

directive that requires compliance with subsection (d), to the board of directors of 

any System institution that fails to comply therewith.

(f) LOANS DESIGNATED FOR SALE OR SOLD INTO THE 

SECONDARY MARKET.

(1) IN GENERAL. Subject to paragraph (2) and notwithstanding 

any other provision of this section, the bylaws adopted by a bank or 

association under subsection (b) may provide—

(A) in the case of a loan made on or after the date of 

enactment of this paragraph that is designated, at the time the loan is 

made, for sale into a secondary market, that no voting stock or 

participation certificate purchase requirement shall apply to the 

borrower for the loan; and

(B) in the case of a loan made before the date of enactment 

of this paragraph that is sold into a secondary market, that all 

outstanding voting stock or participation certificates held by the 

borrower with respect to the loan shall, subject to subsection (d)(1), 

be retired.

(2) APPLICABILITY. Notwithstanding any other provision of 

this section, in the case of a loan sold to a secondary market under title VIII, 

paragraph (1) shall apply regardless of whether the bank or association 

retains a subordinated participation interest in a loan or pool of loans or 

contributes to a cash reserve.

(3) EXCEPTION.

(A) IN GENERAL. Subject to subparagraph (B) and 

notwithstanding any other provision of this section, if a loan 

designated for sale under paragraph (1)(A) is not sold into a 

secondary market during the 180-day period that begins on the date 

of the designation, the voting stock or participation certificate 

purchase requirement that would otherwise apply to the loan in the 

absence of a bylaw provision described in paragraph (1)(A) shall be 

effective.

(B) RETIREMENT. The bylaws adopted by a bank or 

association under subsection (b) may provide that if a loan described 

in subparagraph (A) is sold into a secondary market after the end of 

the 180-day period described in the subparagraph, all outstanding 

voting stock or participation certificates held by the borrower with 

respect to the loan shall, subject to subsection (d)(1), be retired.

(g) CONSTRUCTION. This section shall not be construed to affect the 

provisions of this Act that confer on System institutions a lien on borrower stock 
or other equities and the privilege to retire or cancel such stock or other equities 

for application against the indebtedness on a defaulted or restructured loan.

(h) CONTROLLING AUTHORITY. To the extent that any provision of 

this section is inconsistent with any other provision of this Act (other than section 

4.9A), the provision of this section shall control.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2155

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2155 SEC. 4.4. LIABILITY OF BANKS; UNITED STATES NOT LIABLE.

(a)(1) Each bank of the System shall be fully liable on notes, bonds, 

debentures, or other obligations issued by it individually, and shall be liable for 

the interest payments on long-term notes, bonds, debentures, or other obligations 

issued by other banks operating under the same title of this Act.

(2)(A) Each bank shall also be primarily liable for the portion of any 

issue of consolidated or Systemwide obligations made on its behalf and be 

jointly and severally liable for the payment of any additional sums as called 

upon by the Farm Credit Administration in order to make payments of 

interest or principal which any bank primarily liable therefor shall be 

unable to make.

(B) Such calls first shall be made on all nondefaulting banks 

in proportion to each such banks proportionate share of the aggregate 

available collateral held by all such banks.

(C) For purposes of this paragraph, the term "available 

collateral" means the amount (determined at the close of the last 

calendar quarter ending before such call) by which a bank's collateral 

as described in section 4.3 exceeds the collateral required to support 

the bank's outstanding notes, bonds, debentures, and other similar 

obligations.

(D) If the Farm Credit Administration makes any such call 

and the available collateral of all such banks does not fully satisfy 

the liability necessitating such calls, such calls shall be made on all 

nondefaulting banks in proportion to each such banks remaining 

assets.

(E) Any System bank that, pursuant to a call by the Farm 

Credit Administration, makes a payment of principal or interest to 

the holder of any consolidated or Systemwide obligation issued on 

behalf of another System bank shall be subrogated to all rights of the 

holder against such other bank to the extent of such payment.

(F) On making such a call with respect to obligations issued 

on behalf of a System bank, the Farm Credit Administration shall 

appoint a receiver for the bank, which shall expeditiously liquidate or 

otherwise wind up the affairs of the bank.

(b) Each bank participating in an issue shall by appropriate resolution 

undertake such responsibility as provided in subsection (a) of this section, and in 

the case of consolidated or Systemwide obligations shall authorize the execution 
of such long-term notes, bonds, debentures, or other obligations on its behalf. 

When a consolidated or Systemwide issue is approved, the notes, bonds, 

debentures, or other obligations shall be executed and the banks shall be liable 

thereon as provided herein.

(c) The United States shall not be liable or assume any liability directly 

or indirectly thereon.

(d) Beginning 5 years after the date of the enactment of this subsection, 

the Farm Credit Administration shall not call on any System institution to satisfy 

the liability of the institution on any joint, consolidated, or Systemwide 

obligation participated in by the institution or with respect to which the 

institution is primarily, or jointly and severally, liable, before the Farm Credit 

Insurance Fund is exhausted, even if the Fund is only able to make a partial 

payment because of insufficient amounts in the Fund.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2156

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2156 SEC. 4.5. [Repealed]
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2157

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2157 SEC. 4.6. BONDS AS INVESTMENTS.

The bonds, debentures, and other similar obligations issued under the 

authority of this Act shall be lawful investments for all fiduciary and trust funds 

and may be accepted as security for all public deposits.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2158

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2158 SEC. 4.7. PURCHASE AND SALE BY FEDERAL RESERVE 

SYSTEM.

Any member of the Federal Reserve System may buy and sell bonds, 

debentures, or other similar obligations issued under the authority of this Act and 

any Federal Reserve bank may buy and sell such obligations to the same extent 

and subject to the same limitations placed upon the purchase and sale by said 

banks of State, county, district, and municipal bonds under section 355 of Title 

12, United States Code.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2159

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2159 SEC. 4.8. PURCHASE AND SALE OF OBLIGATIONS; 

ADDITIONAL POWERS.

(a) Each bank of the System may purchase its own obligations and the 

obligations of other banks of the System and may provide for the sale of 

obligations issued by it, consolidated obligations, or Systemwide obligations 

through a fiscal agent or agents, by negotiation, offer, bid, syndicate sale, and to 

deliver such obligations by book entry, wire transfer, or such other means as may 

be appropriate.

(b) Through December 31, 1992, each bank of the System, in addition to 

purchasing obligations as authorized by this Act, may, with the prior approval of 

the Farm Credit Administration and subject to such conditions as it may establish, 

(1) reduce the cost of its borrowings by doing one or more of the following: (A) 

contracting with a third party, or an entity that is established as a limited purpose 

System institution under section 4.25 and that is not to be included in the 

combined financial statements of other System institutions, with respect to the 

payment of interest on the banks obligations and the obligations of other banks 

incurred before January 1, 1985, in consideration of the payment of market 

interest rates on such obligations, plus a premium, or (B) for the period July 1, 

1986, through December 31, 1992, capitalizing interest costs on obligations 

incurred before January 1, 1985, in excess of the estimated interest costs on an 

equivalent amount of Farm Credit System obligations at prevailing market rates 

on such obligations of similar maturities as of the date of the enactment of this 

subsection, or (C) taking other similar action; and (2) amortize, over a period of 

not to exceed 20 years, the capitalization of the premium, capitalization of 

interest expense, or like costs of any action taken under clause (1).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2160

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2160 SEC. 4.9. FEDERAL FARM CREDIT BANKS FUNDING 

CORPORATION.

(a) ESTABLISHMENT. There is hereby established the Federal Farm 

Credit Banks Funding Corporation (hereinafter in this section referred to as the 

"Corporation"), which shall be an institution of the Farm Credit System.

(b) DUTIES. The Corporation—

(1) shall issue, market, and handle the obligations of the banks of 

the Farm Credit System, and interbank or intersystem flow of funds as may 

from time to time be required;

(2) acting for the banks of the Farm Credit System, subject to 

approval of the Farm Credit Administration, shall determine the amount, 

maturities, rates of interest, terms, and conditions of participation by the 

several banks in each issue of joint, consolidated, or Systemwide 

obligations; and

(3) shall exercise such other powers as were provided to the 

predecessor Federal Farm Credit Banks Funding Corporation in accordance 

with its charter issued under section 4.25, in effect immediately before the 

date of the enactment of the Agricultural Credit Act of 1987.

(c) OFFICERS AND COMMITTEES.

(1) DESIGNATION. The board of directors may designate such 

officers and committees for such terms and such purposes as may be 

agreed on by the board.

(2) ISSUANCE OF OBLIGATIONS. When appropriate to the 

boards functions under this section, a committee of the board of directors 

of the Corporation, or representatives thereof, may act on behalf of the 

board in connection with the issuance of joint, consolidated, and 

Systemwide obligations.

(d) BOARD OF DIRECTORS.

(1) COMPOSITION. The board of directors shall be composed of 

nine voting members and one nonvoting member, as follows:

(A) Four voting members shall be current or former directors 

of the System banks elected by the shareholders of the Corporation.

(B) Three voting members shall be chief executive officers 

or presidents of System banks elected by the shareholders of the 

Corporation.

(C) Two voting members shall be appointed by the members 

elected under subparagraphs (A) and (B) after the elected members 

have received recommendations for such appointments from, and 
consulted with, the Secretary of the Treasury and the Chairman of 

the Board of Governors of the Federal Reserve System. The 

appointed members shall be selected from United States citizens—

(i) who are not borrowers from, shareholders in, or 

employees or agents of any System institution, who are not 

affiliated with the Farm Credit Administration, and who are 

not actively engaged with a bank or investment organization 

that is a member of the Corporations selling group for 

Systemwide securities; and

(ii) who are experienced or knowledgeable in 

corporate and public finance, agricultural economics, and 

financial reporting and disclosure.

(D) The president of the Corporation shall serve as a 

nonvoting member of the board.

In selecting candidates under subparagraphs (A) and (B), due consideration shall 

be given to choosing individuals knowledgeable in agricultural economics, public 

and corporate finance, and financial reporting and disclosure.

(2) NON-VOTING REPRESENTATIVES.

(A) ASSISTANCE BOARD. During the period in which the 

Assistance Board is in existence, the board of directors of the 

Assistance Board shall designate one of its directors to serve as a 

non-voting representative to the board of directors of the Corporation.

(B) MEETINGS. The person designated by the Assistance 

Board under subparagraph (A) may attend and participate in all 

deliberations of the board of directors of the Corporation.

(C) TERMINATION OF ASSISTANCE BOARD. After 

termination of the Assistance Board, neither the Assistance Board 

nor its successor, the Farm Credit System Insurance Corporation, 

shall have any representation on the board of directors of the 

Corporation.

(e) TRANSITIONAL AUTHORITY. Until a majority of the voting 

members of the board of directors of the Corporation is elected, which shall 

occur as soon as is practicable after the enactment of this section—

(1) the finance committee established under section 4.5 in effect 

before the date of the enactment of this section, and the fiscal agency 

established under section 4.9 in effect before such date of enactment, shall 

continue to operate as if this section had not been enacted; and 

(2) the board of directors of the predecessor Federal Farm Credit 

Banks Funding Corporation shall be the board of directors of the Financial 

Assistance Corporation.

(f) SUCCESSION.

(1) ASSETS AND LIABILITIES. The Corporation shall, by 

operation of law and without any further action by the Farm Credit 

Administration, the predecessor Federal Farm Credit Banks Funding 

Corporation (hereinafter referred to in this subsection as "the predecessor 

corporation") chartered under this Act, or any court, succeed to the assets 

of and assume all debts, obligations, contracts, and other liabilities of the 

predecessor corporation, matured or unmatured, accrued, absolute, 

contingent or otherwise, and whether or not reflected or reserved against on 

balance sheets, books of account, or records of the predecessor corporation.
(2) CONTRACTS. The existing contractual obligations, security 

instruments, and title instruments of the predecessor corporation shall, by 

operation of law and without any further action by the Farm Credit 

Administration, the predecessor corporation, or any court, become and be 

converted into obligations, entitlements, and instruments of the 

Corporation.

(3) STOCK. The stock of the predecessor corporation issued 

before the date of the enactment of this section shall, by operation of law 

and without any further action by the Farm Credit Administration, the 

predecessor corporation, or any court, become and be converted into stock 

of the Corporation established by this section.

(4) TAXATION. The succession to assets, assumption of 

liabilities, conversion of obligations, instruments, and stock, and 

effectuation of any other transaction by the Corporation to carry out this 

subsection shall not be treated as a taxable event under the laws of any 

State or political subdivision thereof.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part A Funding

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2162

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2162 SEC. 4.9A. PROTECTION OF BORROWER STOCK.

(a) RETIREMENT OF STOCK. Notwithstanding any other section of 

this Act, each institution of the Farm Credit System, when retiring eligible 

borrower stock in accordance with this Act, shall retire such stock at par value. 

(b) CERTAIN POWERS NOT AFFECTED. This section does not 

affect the authority of any institution of the Farm Credit System—

(1) to retire or cancel borrower stock at par value for application 

against a loan in default;

(2) to cancel borrower stock at par value under section 4.14B; or

(3) to apply, against any outstanding indebtedness to a System 

association arising out of or in connection with a liquidation referred to in 

subsection (d)(2) of this section, the par value of borrower stock frozen in 

such liquidation.

(c) INABILITY TO RETIRE STOCK AT PAR VALUE. If an 

institution is unable to retire eligible borrower stock at par value due to the 

liquidation of the institution, the receiver of the institution shall retire such stock 

at par value as would have been retired in the ordinary course of business of the 

institution, and—

(1) during the 5-year period beginning on the date of the 

enactment of the Agricultural Credit Act of 1987, the Assistance Board 

shall direct the Financial Assistance Corporation to provide the receiver 

with sufficient funds to enable the receiver to carry out this subsection; and 

(2) after such 5-year period, the Farm Credit System Insurance 

Corporation shall provide the receiver with sufficient funds from the Farm 

Credit Insurance Fund to enable the receiver to carry out this subsection.

(d) DEFINITIONS. For purposes of this section:

(1) BORROWER STOCK. The term "borrower stock" means 

voting and nonvoting stock, equivalent contributions to a guaranty fund, 

participation certificates, allocated equities, and other similar equities that 

are subject to retirement under a revolving cycle issued by any System 

institution and held by any person other than any System institution.

(2) ELIGIBLE BORROWER STOCK. The term "eligible 

borrower stock" means borrower stock that—

(A) is outstanding on the date of the enactment of this 

section;

(B) is issued or allocated after the date of the enactment of 

this section, but prior to the earlier of—
(i) in the case of each bank and association, the date 

of approval, by the stockholders of such bank or association, of 

the capitalization requirements of the institution in accordance 

with section 4.3A; or

(ii) the date that is 9 months after the date of the 

enactment of this section; 

(C) was, after January 1, 1983, but before the date of the 

enactment of this section, frozen by an institution that was placed in 

liquidation; or

(D) was retired at less than par value by an institution that 

was placed in liquidation after January 1, 1983, but before the date of 

the enactment of this section.

(3) INSTITUTION. The term "institution" means a bank or 

association chartered under this Act.

(4) PAR VALUE. The term "par value" means—

(A) in the case of stock, par value;

(B) in the case of participation certificates and other equities 

and interests not described in subparagraph (C), face or equivalent 

value; or

(C) in the case of participation certificates and allocated 

equities subject to retirement under a revolving cycle but that a 

System institution elects to retire out of order for application against 

a loan in default or otherwise as provided in this Act, par or face 

value discounted, at a rate determined by the institution, to reflect the 

present value of the equity or interest as of the date of such 

retirement.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part B Dissolution

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2183

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part B—Dissolution

12 U.S.C. 2183 SEC. 4.12. DISSOLUTION; VOLUNTARY OR INVOLUNTARY 

LIQUIDATION; MERGERS; RECEIVERSHIPS OR CONSERVATORS.

(a) No institution of the System shall go into voluntary liquidation 

without the consent of the Farm Credit Administration and with such consent 

may liquidate only in accordance with regulations prescribed by the Farm Credit 

Administration. In the case of a voluntary liquidation of an association, such 

regulations, among other things, shall direct the supervising bank to institute such 

measures as it deems appropriate to minimize the adverse effect of the liquidation 

on those borrowers whose loans are purchased by or otherwise transferred to 

another System institution. The Farm Credit Administration Board may require 

an association to merge with another association whenever it determines, with the 

concurrence of the board of the supervising bank, that an association has failed to 

meet its outstanding obligations or failed to conduct its operations in accordance 

with this Act.

(b) The Farm Credit Administration Board may appoint a conservator or 

receiver for any System institution on the determination by the Farm Credit 

Administration Board that one or more of the following exists, or is occurring, 

with respect to the institution: (1) insolvency, in that the assets of the institution 

are less than its obligations to its creditors and others, including its members; (2) 

substantial dissipation of assets or earnings due to any violation of law, rules, or 

regulations, or to any unsafe or unsound practice; (3) an unsafe or unsound 

condition to transact business; (4) willful violation of a cease and desist order 

that has become final; (5) concealment of books, papers, records, or assets of the 

institution or refusal to submit books, papers, records, or other material relating 

to the affairs of the institution for inspection to any examiner or to any lawful 

agent of the Farm Credit Administration; (6) the institution is unable to timely 

pay principal or interest on any insured obligation (as defined in section 5.51(3)) 

issued by the institution. The Farm Credit Administration Board shall have 

exclusive power and jurisdiction to appoint a conservator or receiver, and such 

receiver or conservator, after the 5-year period beginning on the date of the 

enactment of the Agricultural Credit Act of 1987, shall be the Farm Credit 

System Insurance Corporation. If the Farm Credit Administration Board 

determines that a ground for the appointment of a conservator or receiver as 

herein provided exists, the Farm Credit Administration Board may appoint ex 

parte and without notice a conservator or receiver for the institution. In the event 

of such appointment, the institution, within thirty days thereafter, may bring an 
action in the United States district court for the judicial district in which the home 

office of such institution is located, or in the United States District Court for the 

District of Columbia, for an order requiring the Farm Credit Administration 

Board to remove such conservator or receiver, and the court shall, on the merits, 

dismiss such action or direct the Farm Credit Administration Board to remove 

such conservator or receiver. On the commencement of such an action, the court 

having jurisdiction of any other action or enforcement proceeding authorized 

under this Act to which the institution is a party shall stay such action or 

proceeding during the pendency of the action for removal of the conservator or 

receiver. 

(c) In the case of an involuntary liquidation of an association, 

regulations of the Farm Credit Administration, among other things, shall direct 

the supervising bank to institute such measures as it deems appropriate to 

minimize the adverse effect of the liquidation on those borrowers whose loans 

are purchased by or otherwise transferred to another System institution.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part B Dissolution

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2184

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2184 SEC. 4.12A. COMMUNICATIONS WITH STOCKHOLDERS.

(a) PROVISION OF STOCKHOLDER LISTS.

(1) IN GENERAL. Within 7 days after receipt of a written 

request by a stockholder, a bank for cooperatives, Federal land bank 

association, or production credit association shall provide a current list of 

its stockholders to such requesting stockholder.

(2) CONDITIONS. As a condition of providing a stockholder list 

under paragraph (1), the bank or association may require that the 

stockholder agree and certify in writing that the stockholder will—

(A) use the list exclusively for communicating with 

stockholders for permissible purposes; and

(B) not make the list available to any person, other than the 

stockholder's attorney or accountant, without first obtaining the 

written consent of the institution.

(b) ALTERNATIVE COMMUNICATIONS.

(1) REQUEST TO ISSUE. As an alternative to receiving a list of 

stockholders, a stockholder may request the institution to mail or otherwise 

furnish to each stockholder a communication for a permissible purpose on 

behalf of the requesting stockholder.

(2) WHEN PERMISSIBLE. Alternative communications may be 

used, at the discretion of the requesting stockholder, if the requester agrees 

to defray the reasonable costs of the communication. If the requester 

decides to exercise this option, the institution shall provide the requester 

with a written estimate of the costs of handling and mailing the 

communication as soon as is practicable after receipt of the stockholders 

request to furnish the communication.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2199

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part C—Rights of Borrowers; Loan Restructuring

12 U.S.C. 2199 SEC. 4.13. DISCLOSURE.

(a) IN GENERAL. In accordance with regulations of the Farm Credit 

Administration, qualified lenders shall provide to borrowers, for all loans that are 

not subject to the Truth in Lending Act (15 U.S.C. 1601 et seq.), meaningful and 

timely disclosure not later than the time of the loan closing, of—

(1) the current rate of interest on the loan;

(2) in the case of an adjustable or variable rate loan, the amount 

and frequency by which the interest rate can be increased during the term 

of the loan or, if there are no such limitations, a statement to that effect, 

and the factors (including the cost of funds, operating expenses, and 

provision for loan losses) that will be taken into account by the qualified 

lender in determining adjustments to the interest rate;

(3) the effect, as shown by a representative example or examples, 

of any loan origination charges or purchases of stock or participation 

certificates on the effective rate of interest;

(4) any change in the interest rate applicable to the borrower's loan, 

and notice to the borrower of a change in the interest rate applicable to the 

loan of the borrower may be made within a reasonable time after the 

effective date of an increase or decrease in the interest rate;

(5) except with respect to stock guaranteed under section 4.9A, a 

statement indicating that stock that is purchased is at risk; and

(6) a statement indicating the various types of loan options 

available to borrowers, with an explanation of the terms and borrowers' 

rights that apply to each type of loan.

(b) DIFFERENTIAL INTEREST RATES. A qualified lender offering 

more than one rate of interest to borrowers shall, at the request of a borrower of a 

loan—

(1) provide a review of the loan to determine if the proper interest 

rate has been established;

(2) explain to the borrower in writing the basis for the interest rate 

charged; and

(3) explain to the borrower in writing how the credit status of the 

borrower may be improved to receive a lower interest rate on the loan.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2200

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2200 SEC. 4.13A. ACCESS TO DOCUMENTS AND INFORMATION.

In accordance with regulations of the Farm Credit Administration, 

qualified lenders shall provide their borrower, at the time of execution of loans, 

copies of all documents signed by the borrower and at any time thereafter, on a 

borrower's request, copies of all documents signed or delivered by the borrower 

and at any time, on request, a copy of the institution's articles of incorporation or 

charter and bylaws and copies of each appraisal of the borrower's assets made or 

used by the qualified lender.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2201

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2201 SEC. 4.13B. NOTICE OF ACTION ON APPLICATION.

(a) LOAN APPLICATIONS. Each qualified lender to which a person 

has applied for a loan shall provide the person with prompt written notice of—

(1) the action on the application;

(2) if the loan applied for is reduced or denied, the reasons for 

such action; and

(3) the applicant's right to review under section 4.14.

(b) DISTRESSED LOANS. Each qualified lender that has a distressed 

loan outstanding that is subject to restructuring requirements under this Act shall 

provide, in accordance with regulations prescribed by the Farm Credit 

Administration, the borrower with prompt written notice of—

(1) any action taken with respect to restructuring the loan under 

section 4.14A;

(2) if restructuring is denied, the reasons for such action; and

(3) the borrower's right to review under section 4.14.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2202

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2202 SEC. 4.14. RECONSIDERATION OF ACTIONS.

(a) CREDIT REVIEW COMMITTEES.

(1) IN GENERAL. The board of directors of each qualified lender 

shall establish one or more credit review committees, which shall include 

farmer board representation.

(2) MEMBERSHIP. In no case shall a loan officer involved in the 

initial decision on a loan serve on the credit review committee when the 

committee reviews such loan.

(b) REVIEW OF DECISIONS.

(1) DENIALS OR REDUCTIONS. Any applicant for a loan from 

a qualified lender that has received a written notice issued under section 

4.13B of a decision to deny or reduce the loan applied for may submit a 

written request, not later than 30 days after receiving a notice denying or 

reducing the amount of the loan application, to obtain a review of the 

decision before the credit review committee.

(2) DENIALS OF RESTRUCTURING. A borrower of a loan 

from a qualified lender that has received notice, under section 4.13B, of a 

decision to deny loan restructuring with respect to a loan made to the 

borrower, if the borrower so requests in writing within 7 days after 

receiving such notice, may obtain a review of such decision in person 

before the credit review committee.

(c) PERSONAL APPEARANCE. An applicant for a loan or for 

restructuring, who is entitled to and has requested a review under this section, 

may appear in person before the credit review committee, and may be 

accompanied by counsel or by any other representative of such person's choice, 

to seek a reversal of the decision on the application under review.

(d) INDEPENDENT APPRAISAL.

(1) IN GENERAL. An appeal filed with a credit review 

committee under this section may include, as a part of the request for a 

review of the decision filed under subsection (b)(1) or (2), a request for an 

independent appraisal, by an accredited appraiser, of any interests in 

property securing the loan (other than the stock or participation certificates 

of the qualified lender held by the borrower).

(2) ARRANGEMENT AND COST. Within 30 days after a 

request for an appraisal under paragraph (1), the credit review committee 

shall present the borrower with a list of three appraisers approved by the 

appropriate qualified lender from which the borrower shall select an 

appraiser to conduct the appraisal the cost of which shall be borne by the 
borrower, and shall consider the results of such appraisal in any final 

determination with respect to the loan.

(3) COPY TO BORROWER. A copy of any appraisal made 

under this subsection shall be provided to the borrower.

(4) ADDITIONAL COLLATERAL. An independent appraisal 

shall be permitted if additional collateral for a loan is demanded by the 

qualified lender when determining whether to restructure the loan.

(e) NOTIFICATION OF APPLICANT. Promptly after a review by the 

credit review committee, the committee shall notify the applicant or borrower, as 

the case may be, in writing of the decision of the committee and the reasons for 

the decision.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2202a

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2202a SEC. 4.14A. RESTRUCTURING DISTRESSED LOANS.

(a) DEFINITIONS. As used in this part:

(1) APPLICATION FOR RESTRUCTURING. The term 

"application for restructuring" means a written request—

(A) from a borrower for the restructuring of a distressed loan 

in accordance with a preliminary restructuring plan proposed by the 

borrower as a part of the application;

(B) submitted on the appropriate forms prescribed by the 

qualified lender; and

(C) accompanied by sufficient financial information and 

repayment projections, where appropriate, as required by the 

qualified lender to support a sound credit decision.

(2) COST OF FORECLOSURE. The term "cost of foreclosure" 

includes—

(A) the difference between the outstanding balance due on a 

loan made by a qualified lender and the liquidation value of the loan, 

taking into consideration the borrower's repayment capacity and the 

liquidation value of the collateral used to secure the loan;

(B) the estimated cost of maintaining a loan as a 

nonperforming asset;

(C) the estimated cost of administrative and legal actions 

necessary to foreclose a loan and dispose of property acquired as the 

result of the foreclosure, including attorneys' fees and court costs;

(D) the estimated cost of changes in the value of collateral 

used to secure a loan during the period beginning on the date of the 

initiation of an action to foreclose or liquidate the loan and ending on 

the date of the disposition of the collateral; and 

(E) all other costs incurred as the result of the foreclosure or 

liquidation of a loan.

(3) DISTRESSED LOAN. The term "distressed loan" means a 

loan that the borrower does not have the financial capacity to pay 

according to its terms and that exhibits one or more of the following 

characteristics:

(A) The borrower is demonstrating adverse financial and 

repayment trends.

(B) The loan is delinquent or past due under the terms of the 

loan contract.
(C) One or both of the factors listed in subparagraphs (A) 

and (B), together with inadequate collateralization, present a high 

probability of loss to the lender.

(4) FORECLOSURE PROCEEDING. The term "foreclosure 

proceeding" means—

(A) a foreclosure or similar legal proceeding to enforce a lien 

on property, whether real or personal, that secures a nonaccrual or 

distressed loan; or

(B) the seizing of and realizing on nonreal property 

collateral, other than collateral subject to a statutory lien arising 

under title I or II, to effect collection of a nonaccrual or distressed 

loan.

(5) LOAN.

(A) IN GENERAL. Subject to subparagraph (B), the term 

"loan" means a loan made to a farmer, rancher, or producer or 

harvester of aquatic products, for any agricultural or aquatic purpose 

and other credit needs of the borrower, including financing for basic 

processing and marketing directly related to the borrower's 

operations and those of other eligible farmers, ranchers, and 

producers or harvesters of aquatic products.

(B) EXCLUSION FOR LOANS DESIGNATED FOR 

SALE INTO SECONDARY MARKET.

(i) IN GENERAL. Except as provided in clause (ii), 

the term "loan" does not include a loan made on or after the 

date of enactment of this subparagraph that is designated, at 

the time the loan is made, for sale into a secondary market.

(ii) UNSOLD LOANS.

(I) IN GENERAL. Except as provided in 

subclause (II), if a loan designated for sale under clause 

(i) is not sold into a secondary market during the 180-

day period that begins on the date of the designation, the 

provisions of this section and sections 4.14, 4.14B, 

4.14C, 4.14D, and 4.36 that would otherwise apply to 

the loan in the absence of the exclusion described in 

clause (i) shall become effective with respect to the loan.

(II) LATER SALE. If a loan described in 

subclause (I) is sold into a secondary market after the 

end of the 180-day period described in subclause (I), 

subclause (I) shall not apply with respect to the loan 

beginning on the date of the sale.

(6) QUALIFIED LENDER. The term "qualified lender" means—

(A) a System institution that makes loans (as defined in 

paragraph (5)) except a bank for cooperatives; and

(B) each bank, institution, corporation, company, union, and 

association described in section 1.7(b)(1)(B) but only with respect to 

loans discounted or pledged under section 1.7(b)(1).

(7) RESTRUCTURE AND RESTRUCTURING. The terms 

"restructure" and "restructuring" include rescheduling, reamortization, 

renewal, deferral of principal or interest, monetary concessions, and the 

taking of any other action to modify the terms of, or forbear on, a loan in 
any way that will make it probable that the operations of the borrower will 

become financially viable.

(b) NOTICE.

(1) IN GENERAL. On a determination by a qualified lender that 

a loan made by the lender is or has become a distressed loan, the lender 

shall provide written notice to the borrower that the loan may be suitable 

for restructuring, and include with such notice—

(A) a copy of the policy of the lender established under 

subsection (g) that governs the treatment of distressed loans; and

(B) all materials necessary to enable the borrower to submit 

an application for restructuring on the loan.

(2) NOTICE BEFORE FORECLOSURE. Not later than 45 days 

before any qualified lender begins foreclosure proceedings with respect to 

a loan outstanding to any borrower, the lender shall notify the borrower 

that the loan may be suitable for restructuring and that the lender will 

review any such suitable loan for restructuring, and shall include with such 

notice a copy of the policy and the materials described in paragraph (1).

(3) LIMITATION ON FORECLOSURE. No qualified lender 

may foreclose or continue any foreclosure proceeding with respect to any 

distressed loan before the lender has completed any pending consideration 

of the loan for restructuring under this section.

(c) MEETINGS. On determination by a qualified lender that a loan 

made by the lender is or has become a distressed loan, the lender shall provide a 

reasonable opportunity for the borrower thereof to personally meet with a 

representative of the lender—

(1) to review the status of the loan, the financial condition of the 

borrower, and the suitability of the loan for restructuring; and

(2) with respect to a loan that is in nonaccrual status, to develop a 

plan for restructuring the loan if the loan is suitable for restructuring.

(d) CONSIDERATION OF APPLICATIONS.

(1) IN GENERAL. When a qualified lender receives an 

application for restructuring from a borrower, the qualified lender shall 

determine whether or not to restructure the loan, taking into consideration:

(A) whether the cost to the lender of restructuring the loan is 

equal to or less than the cost of foreclosure;

(B) whether the borrower is applying all income over and 

above necessary and reasonable living and operating expenses to the 

payment of primary obligations;

(C) whether the borrower has the financial capacity and the 

management skills to protect the collateral from diversion, 

dissipation, or deterioration;

(D) whether the borrower is capable of working out existing 

financial difficulties, reestablishing a viable operation, and repaying 

the loan on a rescheduled basis; and

(E) in the case of a distressed loan that is not delinquent, 

whether restructuring consistent with sound lending practices may be 

taken to reasonably ensure that the loan will not become a loan that it 

is necessary to place in nonaccrual status.

(2) APPLICATIONS NOT REQUIRED FOR 

RESTRUCTURING PLANS. This section shall not prevent a qualified 
lender from proposing a restructuring plan for an individual borrower in 

the absence of an application for restructuring from the borrower.

(e) RESTRUCTURING.

(1) IN GENERAL. If a qualified lender determines that the 

potential cost to such qualified lender of restructuring the loan in 

accordance with a proposed restructuring plan is less than or equal to the 

potential cost of foreclosure, the qualified lender shall restructure the loan 

in accordance with the plan.

(2) COMPUTATION OF COST OF RESTRUCTURING. In 

determining whether the potential cost to the qualified lender of 

restructuring a distressed loan is less than or equal to the potential cost of 

foreclosure, a qualified lender shall consider all relevant factors, including:

(A) the present value of interest income and principal 

forgone by the lender in carrying out the restructuring plan;

(B) reasonable and necessary administrative expenses 

involved in working with the borrower to finalize and implement the 

restructuring plan;

(C) whether the borrower has presented a preliminary 

restructuring plan and cash-flow analysis taking into account income 

from all sources to be applied to the debt and all assets to be pledged, 

showing a reasonable probability that orderly debt retirement will 

occur as a result of the proposed restructuring; and

(D) whether the borrower has furnished or is willing to 

furnish complete and current financial statements in a form 

acceptable to the institution.

(f) LEAST COST ALTERNATIVE. If two or more restructuring 

alternatives are available to a qualified lender under this section with respect to a 

distressed loan, the lender shall restructure the loan in conformity with the 

alternative that results in the least cost to the lender.

(g) RESTRUCTURING POLICY.

(1) ESTABLISHMENT. Each bank board of directors shall 

develop a policy within 60 days after the date of the enactment of this 

section, that is consistent with this section, to govern the restructuring of 

distressed loans. Such policy shall constitute the restructuring policy of 

each qualified lender within the district.

(2) CONTENTS OF POLICY. The policy established under 

paragraph (1) shall include an explanation of—

(A) the procedure for submitting an application for 

restructuring; and

(B) the right of borrowers with distressed loans to seek 

review by a credit review committee in accordance with section 4.14

of a denial of an application for restructuring.

(3) SUBMISSION OF POLICY TO FCA. Each bank board shall 

submit the policy of the district governing the treatment of distressed loans 

under this section to the Farm Credit Administration. Notwithstanding the 

duty imposed by the preceding sentence, the other duties imposed by this 

section shall take effect on the date of the enactment of this section.

(h) REPORTS. During the 5-year period beginning on the date of the 

enactment of this section, each qualified lender shall submit semiannual reports 

to the Farm Credit Administration containing—

(1) the results of the review of distressed loans of the lender; and
(2) the financial effect of loan restructurings and liquidations on 

the lender.

(i) COMPLIANCE. The Farm Credit Administration may issue a 

directive requiring compliance with any provision of this section to any qualified 

lender that fails to comply with such provision.

(j) PERMITTED FORECLOSURES. This section shall not be 

construed to prevent any qualified lender from enforcing any contractual 

provision that allows the lender to foreclose a loan or from taking such other 

lawful action as the lender deems appropriate, if the lender has reasonable 

grounds to believe that the loan collateral will be destroyed, dissipated, 

consumed, concealed, or permanently removed from the State in which the 

collateral is located.

(k) APPLICATION OF SECTION. The time limitation prescribed in 

subsection (b)(2) of this section, and the requirements of subsection (c) of this 

section, shall not apply to a loan that became a distressed loan before the date of 

the enactment of this section, if the borrower and lender of the loan are in the 

process of negotiating loan restructuring with respect to the loan. 

(l) ASSISTANCE IN RESTRUCTURING. Each Farm Credit Bank, on 

request of any production credit association, may assist the association in 

restructuring loans under this section.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2202b

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2202b SEC. 4.14B. EFFECT OF RESTRUCTURING ON BORROWER 

STOCK.

(a) FARM CREDIT BANK. If a Farm Credit Bank forgives and writes 

off, under section 4.14A, any of the principal outstanding on a loan made to any 

borrower, the Federal land bank association of which the borrower is a member 

and stockholder shall cancel the same dollar amount of borrower stock held by 

the borrower in respect of the loan, up to the total amount of such stock, and, to 

the extent provided for in the bylaws of the bank relating to its capitalization, the 

bank shall retire an equal amount of stock owned by the Federal land bank 

association. 

(b) PRODUCTION CREDIT ASSOCIATION. If a production credit 

association forgives and writes off, under section 4.14A, any of the principal 

outstanding on a loan made to any borrower, the association shall cancel the 

same dollar amount of borrower stock held by the borrower in respect of the loan, 

up to the total amount of such stock.

(c) RETENTION OF STOCK. Notwithstanding subsections (a) and (b) 

of this section, the borrower shall be entitled to retain at least one share of stock 

to maintain the borrowers membership and voting interest in the association.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2202c

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2202c SEC. 4.14C. REVIEW OF RESTRUCTURING DENIALS.

(a) REQUIREMENTS FOR RESTRUCTURING BY SYSTEM 

INSTITUTIONS.

(1) EXISTING NONACCRUAL LOANS. Within 9 months after 

a qualified lender is certified under section 6.4, such lender shall review 

each loan that has not been previously restructured and that is in 

nonaccrual status on the date the lender is certified, and determine whether 

to restructure the loan.

(2) NEW NONACCRUAL LOANS. Within 6 months after a loan 

made by a certified lender is placed in nonaccrual status, the lender shall 

determine whether to restructure the loan.

(b) SPECIAL ASSET GROUPS.

(1) ESTABLISHMENT. Within 30 days after a qualified lender 

in a district is certified to issue preferred stock under section 6.27, the Farm 

Credit Bank board shall establish a special asset group that shall review 

each determination by the lender not to restructure a loan.

(2) RESTRUCTURING PLAN. If a special asset group 

determines under paragraph (1) that a loan under review should be 

restructured, the group shall prescribe a restructuring plan for the loan that 

the qualified lender shall implement.

(c) NATIONAL SPECIAL ASSET COUNCIL.

(1) ESTABLISHMENT. A National Special Asset Council shall 

be established by the Assistance Board to—

(A) monitor compliance with the restructuring requirements 

of this section by qualified lenders certified to issue preferred stock 

under section 6.27, and by special asset groups established under 

subsection (b) of this section; and 

(B) review a sample of determinations made by each special 

asset group that a loan will not be restructured.

(2) REVIEW OF DETERMINATION. The National Special 

Asset Council shall review a sufficient number of determinations made by 

each special asset group to foreclose on any loan to assure the Council that 

such group is complying with this section. With regard to each 

determination reviewed, the Council shall make an independent judgment 

on the merits of the decision to foreclose rather than restructure the loan.

(3) NONCOMPLIANCE. If the National Special Asset Council 

determines that any special asset group is not in substantial compliance 

with this section, the Council shall notify the group of the determination, 
and may take such other action as the Council considers necessary to 

ensure that such group complies with this section.

(d) REPORT. With respect to determinations by a special asset group 

that a loan will not be restructured, the special asset group shall submit to the 

National Special Asset Council a report evaluating the loan and the basis for the 

determination that the loan should not be restructured.

(e) RESTRUCTURING FACTORS. In determining whether a loan is to 

be restructured, the National Special Asset Council, each special asset group, and 

each qualified lender certified under section 6.4 shall take into consideration the 

factors specified in section 4.14A(d)(1).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2202d

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2202d SEC 4.14D. PROTECTION OF BORROWERS WHO MEET ALL 

LOAN OBLIGATIONS.

(a) FORECLOSURE PROHIBITED. A qualified lender may not 

foreclose on any loan because of the failure of the borrower thereof to post 

additional collateral, if the borrower has made all accrued payments of principal, 

interest, and penalties with respect to the loan.

(b) PROHIBITION AGAINST REQUIRED PRINCIPAL REDUCTION. 

A qualified lender may not require any borrower to reduce the outstanding 

principal balance of any loan made to the borrower by any amount that exceeds 

the regularly scheduled principal installment payment (when due and payable), 

unless—

(1) the borrower sells or otherwise disposes of part or all of the 

collateral; or

(2) the parties agree otherwise in a written agreement entered into 

by the parties.

(c) NONENFORCEMENT. After a borrower has made all accrued 

payments of principal, interest, and penalties with respect to a loan made by a 

qualified lender, the lender shall not enforce acceleration of the borrower's 

repayment schedule due to the borrower having not timely made one or more 

principal or interest payments.

(d) PLACING LOANS IN NONACCRUAL STATUS.

(1) NOTIFICATION. If a qualified lender places any loan in 

nonaccrual status, the lender shall document such change of status and 

promptly notify the borrower thereof in writing of such action and the 

reasons therefor.

(2) REVIEW OF DENIAL. If the borrower was not delinquent in 

any principal or interest payment under the loan at the time of such action 

and the borrowers request to have the loan placed back into accrual status 

is denied, the borrower may obtain a review of such denial before the 

appropriate credit review committee under section 4.14.

(3) APPLICATION. This subsection shall only apply if a loan 

being placed in nonaccrual status results in an adverse action being taken 

against the borrower.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part C Rights of Borrowers; Loan Restructuring

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2202e

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2202e SEC. 4.14E. WAIVER OF MEDIATION RIGHTS BY 

BORROWERS.

No System institution may make a loan secured by a mortgage or lien on 

agricultural property to a borrower on the condition that the borrower waive any 

right under the agricultural loan mediation program of any State.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2203

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part D—Activities of Institutions of the System

12 U.S.C. 2203 SEC. 4.15. NOMINATION OF ASSOCIATION DIRECTORS; 

REPRESENTATIVE SELECTION OF NOMINEES.

Each production credit association and each Federal land bank association 

shall elect a nominating committee by vote of the stockholders at the annual 

meeting to serve for the following year. Each nominating committee shall 

review lists of farmers from the association territory, determine their willingness 

to serve, and submit for election a slate of eligible candidates which shall include 

at least two nominees for each elective office to be filled. In doing so, the 

committee shall endeavor to assure representation to all sections of the 

association territory and as nearly as possible to all types of agriculture practiced 

within the area. Employees of the association shall not be eligible to be 

nominated, elected, or serve as a member of the board. Nominations shall also 

be accepted from the floor. Members of the board are not eligible to serve on the 

nominating committee. Regulations of the Farm Credit Administration 

governing the election of bank directors shall similarly assure a choice of two 

nominees for each elective office to be filled and that the bank board represent as 

nearly as possible all types of agriculture in the district.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2204

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2204 SEC. 4.16. [Repealed]
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2205 

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2205 SEC. 4.17. INTEREST RATES.

Interest rates on loans from institutions of the Farm Credit System shall not 

be subject to any interest rate limitation imposed by any State constitution or 

statute or other laws. Such limitation is preempted for purposes of this Act. 

Interest rates on loans made by agricultural credit corporations organized in 

conjunction with cooperative associations for the purpose of financing the 

ordinary crop operations of the members of such associations or other producers 

and eligible to discount with the Federal intermediate credit banks and Farm 

Credit Banks shall be exempt from any interest rate limitation imposed by any 

State constitution or statute or other laws which are hereby preempted for 

purposes of this Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2206 

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2206 SEC. 4.18. PARTICIPATION LOANS.

Notwithstanding any other provisions of this Act, the terms of any loan 

participated in by two or more Farm Credit System institutions operating under 

different titles of this Act, including provisions for capitalization of the portion of 

the loan participated in by each institution, shall be as may be agreed upon 

among such institutions and authorized under regulations issued by the Farm 

Credit Administration, except that for purposes of determining borrower 

eligibility, membership, term, amount, loan security, and purchase of stock or 

participation certificates by the borrower, the provisions of law applicable to the 

loan shall be the provisions in the title under which the institution that originates 

the loan operates.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2206a 

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2206a SEC. 4.18A. AUTHORITY OF FARM CREDIT BANKS AND 

DIRECT LENDER ASSOCIATIONS TO PARTICIPATE IN LOANS TO 

SIMILAR ENTITIES FOR RISK MANAGEMENT PURPOSES.

(a) DEFINITIONS. As used in this section:

(1) PARTICIPATE AND PARTICIPATION. The terms 

"participate" and "participation" shall have the meaning provided in section 

3.1(11)(B)(iii).

(2) SIMILAR ENTITY. The term "similar entity" means a person 

that—

(A) is not eligible for a loan from the Farm Credit Bank or 

association; and

(B) has operations that are functionally similar to a person 

that is eligible for a loan from the Farm Credit Bank or association in 

that the person derives a majority of the income of the person from, 

or has a majority of the assets of the person invested in, the conduct 

of activities that are functionally similar to the activities that are 

conducted by an eligible person.

(b) LOAN PARTICIPATION AUTHORITY. Notwithstanding any 

other provision of this Act, any Farm Credit Bank or direct lender association 

chartered under this Act may participate in any loan of a type otherwise 

authorized under title I or II made to a similar entity by any person in the 

business of extending credit, except that a Farm Credit Bank or direct lender 

association may not participate in a loan under this section if—

(1) the participation would cause the total amount of all 

participations by the Farm Credit Bank or association under this section 

involving a single credit risk to exceed 10 percent (or the applicable higher 

lending limit authorized under regulations issued by the Farm Credit 

Administration if the stockholders of the respective Farm Credit Bank or 

association so approve) of the total capital of the Farm Credit Bank or 

association;

(2) the participation by the Farm Credit Bank or association would 

equal or exceed 50 percent of the principal of the loan or, when taken 

together with participations in the loan by other Farm Credit System 

institutions, would cause the cumulative amount of the participations by all 

Farm Credit System institutions in the loan to equal or exceed 50 percent 

of the principal of the loan;

(3) the participation would cause the cumulative amount of 

participations that the Farm Credit Bank or association has outstanding 
under this section to exceed 15 percent of the total assets of the Farm 

Credit Bank or association; or

(4) the loan is of the type authorized under section 1.11(b) or 

2.4(a)(2).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2207

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2207 SEC. 4.19. YOUNG, BEGINNING, AND SMALL FARMERS AND 

RANCHERS.

(a) Under policies of the district Farm Credit Bank board, each Federal 

land bank association and production credit association shall prepare a program 

for furnishing sound and constructive credit and related services to young, 

beginning, and small farmers and ranchers. Such programs shall assure that such 

credit and services are available in coordination with other units of the Farm 

Credit System serving the territory and with other governmental and private 

sources of credit. Each program shall be subject to review and approval by the 

supervising bank.

(b) The Farm Credit Bank for each district shall annually obtain from 

associations under its supervision reports of activities under programs developed 

pursuant to subsection (a) of this section and progress toward program objectives. 

On the basis of such reports, the bank shall provide to the Farm Credit 

Administration an annual report summarizing the operations and achievements in 

its district under such programs.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2208

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2208 SEC. 4.20. PROHIBITION AGAINST USE OF SIGNED BALLOTS.

In any election or merger vote, or other proceeding subject to a vote of the 

stockholders (or subscribers to the guaranty fund of a bank for cooperatives), 

conducted by a lending institution of the Farm Credit System, the institution—

(1) may not use signed ballots; and

(2) shall implement measures to safeguard the voting process for 

the protection of the right of stockholders (or subscribers) to a secret ballot.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part D Activities of Institutions of the System

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2209

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2209 SEC. 4.21. COMPENSATION OF BANK DIRECTORS.

(a) IN GENERAL. The Farm Credit Administration shall monitor the 

compensation of members of the board of directors of a System bank received as 

compensation for serving as a director of the bank to ensure that the amount of 

the compensation does not exceed a level of $20,000 per year, as adjusted to 

reflect changes in the Consumer Price Index for all urban consumers published 

by the Bureau of Labor Statistics, unless the Farm Credit Administration 

determines that such level adversely affects the safety and soundness of the bank.

(b) WAIVER. The Farm Credit Administration may waive the 

limitation prescribed in subsection (a) under exceptional circumstances, as 

determined in accordance with regulations promulgated by the Farm Credit 

Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part E Service Organizations

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2211

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part E—Service Organizations

12 U.S.C. 2211 SEC. 4.25. ESTABLISHMENT.

Any bank of the Farm Credit System, or two or more of such banks acting 

together, may organize a corporation or corporations for the purpose of 

performing functions and services for or on behalf of the organizing bank or 

banks that the bank or banks may perform pursuant to this Act: Provided, That a 

corporation so organized shall have no authority either to extend credit or provide 

insurance services for borrowers from Farm Credit System institutions, nor shall 

it have any greater authority with respect to functions and services than the 

organizing bank or banks possess under this Act. The organizing bank or banks 

shall apply for a Federal charter for the corporation by forwarding to the Farm 

Credit Administration a statement of the need for the corporation and proposed 

articles specifying in general terms the objectives for which the corporation is 

formed, the powers to be exercised by it in carrying out the functions and 

services, and the territory it is to serve. The Farm Credit Administration for good 

cause may deny the charter applied for. Upon the approval of articles by the 

Farm Credit Administration and the issuance of a charter, the corporation shall 

become as of such date a federally chartered body corporate and an 

instrumentality of the United States.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part E Service Organizations

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2212

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2212 SEC. 4.26. POWERS OF THE FARM CREDIT ADMINISTRATION.

The Farm Credit Administration shall have power, under rules and 

regulations prescribed by the Farm Credit Administration, to provide for the 

organization of any corporation chartered under this part and the territory within 

which its operations may be carried on, and to approve amendments consistent 

with this Act to charters or articles of service corporations.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part E Service Organizations

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2213

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2213 SEC. 4.27. REGULATION AND EXAMINATION.

The corporations organized under this part shall be institutions of the Farm 

Credit System and shall be subject to the same regulation and examination by the 

Farm Credit Administration as are the organizing bank or banks under this Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part E Service Organizations

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2214

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2214 SEC. 4.28. STATE LAWS.

State and other laws shall apply to corporations organized pursuant to this 

part to the same extent such laws would apply to the organizing banks engaged in 

the same activity in the same jurisdiction: Provided, however, That to the 

extent that sections 1.15, 2.16, and 3.13 of this Act may exempt banks or 

associations of the Farm Credit System from taxation, such exemptions, other 

than with respect to franchise taxes, shall not extend to corporations organized 

pursuant to this part.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part E Service Organizations

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2214a

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2214a SEC. 4.28A. DEFINITION OF BANK.

In this part, the term "bank" includes each association operating under title 

II.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part F Sale of Insurance

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2218

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part F—Sale of Insurance

12 U.S.C. 2218 SEC. 4.29. LINES OF INSURANCE.

(a)(1) The regulations of the Farm Credit Administration governing 

financially related services that the banks and associations of the Farm Credit 

System may provide under titles I and II may authorize the sale to any member of 

or borrower from any such bank or association, on an optional basis, of credit or 

term life and credit disability insurance appropriate to protect the loan 

commitment in the event of death or disability of the debtors and other insurance 

necessary to protect the member's farm or aquatic unit, but limited to, hail and 

multiple-peril crop insurance, title insurance, and insurance to protect the 

facilities and equipment of aquatic borrowers. A member or borrower shall have 

the option, without coercion from the bank or association of such member or 

borrower, to accept or reject such insurance.

(2) In making insurance available through private insurers, the 

banks shall approve the programs of more than two insurers for each type 

of insurance offered in the district, if more than two insurers for each type 

of insurance have proposed programs to a bank that will, in all likelihood, 

have long-term viability and meet the requirements of subsection (b)(2)(D). 

The banks may provide comparative information relating to costs and 

quality of approved programs and the financial conditions of approved 

companies. Associations shall offer at least two insurers for each program 

from among those approved by the Farm Credit Banks, if at least two 

insurers have been approved in accordance with this paragraph.

(b) Such regulations shall provide that—

(1) in any case in which insurance is required as a condition for a 

loan or other financial assistance from a bank or association, notice be 

given that it is not necessary to purchase the insurance from the bank or 

association and that the borrower has the option of obtaining the insurance 

elsewhere;

(2) such insurance services may be offered only if—

(A) the bank or association has the capacity to render 

insurance service under this Act in an effective and efficient manner;

(B) there exists the probability that any insurance program 

under this Act will generate sufficient revenue to cover all costs;

(C) rendering insurance service will not have an adverse 

effect on the bank's or association's credit or other operations;
(D) the insurance program has been approved by the bank or 

association from among specific programs made available to it by 

insurers—

(i) meeting reasonable financial and quality of service 

standards; and 

(ii) licensed under State law to do business in the State; 

and

(E) in making insurance available through approved insurers, 

the board of directors of the association or bank selects and offers at 

least two approved insurers for each type of insurance made 

available to the members and borrowers, if at least two insurers have 

been approved in accordance with subsection (a)(2); and

(3) no bank or association shall directly or indirectly discriminate 

in any manner against any agent, broker, or insurer that is not affiliated 

with such bank or association, or against any party who purchases 

insurance through any such nonaffiliated insurance agent, broker, or 

insurer.

(c) Notwithstanding any provision of this section to the contrary, any 

bank or association that on the date of enactment of the Farm Credit Act 

Amendments of 1980, is offering insurance coverages not authorized by this 

section may continue to sell such coverages for a period of not more than one 

year from such date of enactment and may continue to service such coverages 

until their expiration.

Note: See section 422(b) of the Agricultural Credit Act of 1987 for a 

provision relating to insurance programs in effect prior to the date of 

enactment of such act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part G Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2219

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part G—Miscellaneous

12 U.S.C. 2219 SEC. 4.35. LIMITATION ON SEPARATE SALE.

If real property is acquired by any institution of the Farm Credit System 

through foreclosure, no institution of the Farm Credit System shall sell the 

surface rights to that real property to any person unless the institution also sells 

all mineral rights to that real property to that person.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part G Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2219a

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2219a SEC 4.36. RIGHT OF FIRST REFUSAL.

(a) GENERAL RULE. Agricultural real estate that is acquired by an 

institution of the System as a result of a loan foreclosure or a voluntary 

conveyance by a borrower (hereinafter in this section referred to as the "previous 

owner") who, as determined by the institution, does not have the financial 

resources to avoid foreclosure (hereinafter in this section referred to as "acquired 

real estate") shall be subject to the right of first refusal of the previous owner to 

repurchase or lease the property, as provided in this section.

(b) APPLICATION OF RIGHT OF FIRST REFUSAL TO SALE OF 

PROPERTY. 

(1) ELECTION TO SELL AND NOTIFICATION. Within 15 

days after an institution of the System first elects to sell acquired real estate, 

or any portion of such real estate, the institution shall notify the previous 

owner by certifed mail of the owner's right—

(A) to purchase the property at the appraised fair market 

value of the property, as established by an accredited appraiser; or

(B) to offer to purchase the property at a price less than the 

appraised value.

(2) ELIGIBILITY TO PURCHASE. To be eligible to purchase 

the property under paragraph (1), the previous owner must, within 30 days 

after receiving the notice required by such paragraph, submit an offer to 

purchase the property.

(3) MANDATORY SALE. An institution of the System receiving 

an offer from the previous owner to purchase the property at the appraised 

value shall, within 15 days after the receipt of such offer, accept such offer 

and sell the property to the previous owner.

(4) PERMISSIVE SALE. An institution of the System receiving 

an offer from the previous owner to purchase the property at a price less 

than the appraised value may accept such offer and sell the property to the 

previous owner. Notice shall be provided to the previous owner of the 

acceptance or rejection of such offer within 15 days after the receipt of 

such offer.

(5) REJECTION OF OFFER OF PREVIOUS OWNER.

(A) DUTIES OF INSTITUTION. An institution of the 

System that rejects an offer from the previous owner to purchase the 

property at a price less than the appraised value may not sell the 

property to any other person—
(i) at a price equal to, or less than, that offered by the 

previous owner; or

(ii) on different terms and conditions than those that 

were extended to the previous owner, without first affording 

the previous owner an opportunity to purchase the property at 

such price or under such terms and conditions.

(B) NOTICE. Notice of the opportunity in subparagraph (A) 

shall be provided to the previous owner by certified mail, and the 

previous owner shall have 15 days in which to submit an offer to 

purchase the property at such price or under such terms and 

conditions.

(c) APPLICATION OF RIGHT OF FIRST REFUSAL TO LEASING 

OF PROPERTY.

(1) ELECTION TO LEASE AND NOTIFICATION. Within 15 

days after an institution of the System first elects to lease acquired real 

estate, or any portion of such real estate, the institution shall notify the 

previous owner by certified mail of the owner's right—

(A) to lease the property at a rate equivalent to the appraised 

rental value of the property, as established by an accredited appraiser; 

or

(B) to offer to lease the property at a rate that is less than the 

appraised rental value of the property.

(2) ELIGIBILITY TO LEASE. To be eligible to lease the 

property under paragraph (1), the previous owner must, within 15 days 

after receiving the notice required by such paragraph, submit an offer to 

lease the property.

(3) MANDATORY LEASE. An institution of the System 

receiving an offer from the previous owner to lease the property at a rate 

equivalent to the appraised rental value of the property shall, within 15 

days after the receipt of such offer, acccept such offer and lease the 

property to the previous owner unless the institution determines that the 

previous owner—

(A) does not have the resources available to conduct a 

successful farming or ranching operation; or

(B) cannot meet all of the payments, terms, and conditions 

of such lease.

(4) PERMISSIVE LEASE. An institution of the System receiving 

an offer from the previous owner to lease the property at a rate that is less 

than the appraised rental value of the property may accept such offer and 

lease the property to the previous owner.

(5) NOTICE TO PREVIOUS OWNER. An institution of the 

System receiving an offer from the previous owner to lease the property at 

a rate less than the appraised rental value of the property shall notify the 

previous owner of its acceptance or rejection of the offer within 15 days 

after the receipt of such offer.

(6) REJECTION OF OFFER OF PREVIOUS OWNER.

(A) DUTIES OF INSTITUTION. An institution of the 

System rejecting an offer from the previous owner to lease the 

property at a rate less than the appraised rental value of the property 

may not lease the property to any other person—
(i) at a rate equal to or less than that offered by the 

previous owner; or

(ii) on different terms and conditions than those that 

were extended to the previous owner, without first affording 

the previous owner an opportunity to lease the property at such 

rate or under such terms and conditions.

(B) NOTICE. Notice of the opportunity described in 

subparagraph (A) shall be given to the previous owner by certified 

mail, and the previous owner shall have 15 days after the receipt of 

such notice in which to agree to lease the property at such rate or 

under such terms and conditions.

(d) PUBLIC OFFERINGS.

(1) NOTIFICATION OF PREVIOUS OWNER. If an institution 

of the System elects to sell or lease acquired property or a portion thereof 

through a public auction, competitive bidding process, or other similar 

public offering, the institution shall notify the previous owner, by certified 

mail, of the availability of the property. Such notice shall contain the 

minimum amount, if any, required to qualify a bid as acceptable to the 

institution and any terms and conditions to which such sale or lease will be 

subject.

(2) PRIORITY. If two or more qualified bids in the same amount 

are received by the institution under paragraph (1), such bids are the 

highest received, and one of the qualified bids is offered by the previous 

owner, the institution shall accept the offer by the previous owner.

(3) NONDISCRIMINATION. No institution of the System may 

discriminate against a previous owner in any public auction, competitive 

bidding process, or other similar public offering of property acquired by 

the institution from such person.

(e) TERM OR CONDITION. For the purposes of this section, financing 

by a System institution shall not be considered to be a term or condition of a sale 

of acquired real estate.

(f) FINANCING. Notwithstanding any other provision of this section, a 

System institution shall not be required to provide financing to the previous 

owner in connection with the sale of acquired real estate.

(g) MAILING OF NOTICE. Notwithstanding any other provision of 

this section, each certified mail notice requirement in this section shall be fully 

satisfied by mailing one certified mail notice to the last known address of the 

previous owner. 

(h) STATE LAWS. The rights provided in this section shall not 

diminish any such right of first refusal under the law of the State in which the 

property is located.

(i) APPLICABILITY. This section shall not apply to a bank for 

cooperatives.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part G Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2219b

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2219b SEC. 4.37. APPLICATION OF UNINSURED ACCOUNTS.

(a) IN GENERAL. Money of a borrower held by a Farm Credit System 

institution in an uninsured voluntary or involuntary account as authorized under 

regulations issued by the Farm Credit Administration (as in effect immediately 

before the date of the enactment of this section), including all such other accounts 

known as "advanced payment accounts" or "future prepayment accounts" shall, 

in the event the institution is placed in liquidation, be immediately applied as 

payment against the indebtedness of any outstanding loans of such borrower.

(b) REGULATIONS. The Farm Credit Administration shall promulgate 

regulations—

(1) that define the term "uninsured voluntary or involuntary 

account"; and

(2) to otherwise effectively carry out the section.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part G Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2219c

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2219c SEC 4.38. AFFIRMATIVE ACTION.

The Assistance Board established under section 6.0 and all institutions of 

the Farm Credit System with more than 20 employees shall establish and 

maintain an affirmative action program plan that applies the affirmative action 

standards otherwise applied to contractors of the Federal government.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title IV Provisions Applicable to Two or More Classes of Institutions of 

the System

Part: Part G Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2219d

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2219d SEC. 4.39. ENCOURAGEMENT OF CONSERVATION 

PRACTICES.

At the time a System institution or an agricultural mortgage loan originator 

(as defined in section 8.0(7)) approves a loan made to a borrower that, in the 

opinion of the institution or originator, would be ineligible for a loan made, 

insured, or guaranteed under the Consolidated Farm and Rural Development Act 

(7 U.S.C. 1921 et seq.) by reason of subtitle B or C of title XII of the Food 

Security Act of 1985 (16 U.S.C. 3811 et seq.), the institution or originator as the 

case may be, shall encourage the borrower to contact the Department of 

Agriculture Soil Conservation Service to obtain information about soil 

conservation methods and practices.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2241

Date Created: 12/17/2012

Date Modified: 2/15/2018

TITLE V—FARM CREDIT ADMINISTRATION ORGANIZATION

Part B—Farm Credit Administration Organization

12 U.S.C. 2241 SEC. 5.7. THE FARM CREDIT ADMINISTRATION.

The Farm Credit Administration shall be an independent agency in the 

executive branch of the Government. It shall be composed of the Farm Credit 

Administration Board and such other personnel as are employed in carrying out 

the functions, powers, and duties vested in the Farm Credit Administration by 

this Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2242

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2242 SEC. 5.8. THE FARM CREDIT ADMINISTRATION BOARD; 

APPOINTMENT; TERMS OF OFFICE; ORGANIZATION AND 

COMPENSATION.

(a) The management of the Farm Credit Administration shall be vested 

in a Farm Credit Administration Board (referred to in this part as "the Board"). 

The Board shall consist of three members, who shall be citizens of the United 

States and broadly representative of the public interest. Members of the Board 

shall be appointed by the President, by and with the advice and consent of the 

Senate. Not more than two members of the Board shall be members of the same 

political party. Of the persons thus appointed, one shall be designated by the 

President to serve as Chairman of the Board for the duration of the member's 

term. The members of the Board shall be ineligible during the time they are in 

office and for two years thereafter to hold any office, position, or employment in 

any institution of the Farm Credit System.

(b) The term of office of each member of the Board shall be six years, 

except that the terms of the two members, other than the Chairman, first 

appointed under subsection (a) of this section shall expire, one on the expiration 

of two years after the date of appointment, and one on the expiration of four 

years after the date of appointment. Members of the Board shall not be 

appointed to succeed themselves, except that the members first appointed under 

subsection (a) of this section for a term of less than six years may be reappointed 

for a full six-year term and members appointed to fill unexpired terms of three 

years or less may be reappointed for a full six-year term. Any vacancy shall be 

filled for the unexpired term on like appointment. Any member of the Board 

shall continue to serve as such after the expiration of the member's term until a 

successor has been appointed and qualified.

(c) Each member of the Board, within fifteen days after notice of 

appointment, shall subscribe to the oath of office. The Board may transact 

business if a vacancy exists, provided a quorum is present. A quorum shall 

consist of two members of the Board. The Board shall hold at least one meeting 

each month and such additional meetings at such times and places as it may fix 

and determine. Such meetings shall be held on the call of the Chairman or any 

two Board members. The Board shall adopt such rules as it deems appropriate for

the transaction of business by the Board, and shall keep permanent and accurate 

records and minutes of the actions and proceedings of the Board.

(d) The members of the Board shall devote their full time and attention 

to the business of the Board. The Chairman of the Board shall receive 

compensation at the rate prescribed for level III of the Executive Schedule under 
section 5314 of Title 5 of the United States Code. Each of the other members of 

the Board shall receive compensation at the rate prescribed for level IV of the 

Executive Schedule under section 5315 of Title 5 of the United States Code. 

Each member of the Board shall be reimbursed for necessary travel, subsistence, 

and other expenses in the discharge of the member's official duties without regard 

to other laws with respect to allowance for travel and subsistence of officers and 

employees of the United States. This subsection shall be subject to the 

provisions of section 5.11 of this Act.

(e) The President shall appoint members of the Board who—

(1) are experienced or knowledgeable in agricultural economics 

and financial reporting and disclosure;

(2) are experienced or knowledgeable in the regulation of financial 

entities; or

(3) have a strong financial, legal, or regulatory background.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2243

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2243 SEC. 5.9. POWERS OF THE BOARD.

The Board shall manage and administer, and establish policies for, the 

Farm Credit Administration. It—

(1) shall approve the rules and regulations for the implementation 

of this Act not inconsistent with its provisions;

(2) shall provide for the examination of the condition of, and 

general regulation of the performance of the powers, functions, and duties 

vested in, each institution of the Farm Credit System;

(3) shall provide for the performance of all the powers and duties 

vested in the Farm Credit Administration; and

(4) may require such reports as it deems necessary from the 

institutions of the Farm Credit System.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2244

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2244 SEC. 5.10. CHAIRMAN; RESPONSIBILITIES; GOVERNING 

STANDARDS.

(a)(1) The Chairman of the Board shall be the chief executive officer of 

the Farm Credit Administration.

(2) In carrying out the responsibilities of the chief executive 

officer, the Chairman shall be responsible for directing the implementation 

of policies and regulations adopted by the Board and, after consultation 

with the Board, the execution of the administrative functions and duties of 

the Farm Credit Administration.

(3) In carrying out policies as directed by the Board, the Chairman 

shall act as spokesperson for the Board and represent the Board and the 

Farm Credit Administration in their official relations within the Federal 

Government.

(4) Under policies adopted by the Board, the Chairman shall 

consult on a regular basis with—

(A) the Secretary of the Treasury concerning the exercise, by 

the System, of the powers conferred under section 4.2;

(B) the Board of Governors of the Federal Reserve System 

concerning the effect of System lending activities on national 

monetary policy; and 

(C) the Secretary of Agriculture concerning the effect of 

System policies on farmers, ranchers, and the agricultural economy.

(b) In carrying out responsibilities under this Act, the Chairman of the 

Board shall be governed by general policies adopted by the Board and by such 

regulatory decisions, findings, and determinations as the Board may by law be 

authorized to make and, as to third persons, all acts of the Chairman of the Board 

shall be conclusively presumed to be in compliance with such general policies 

and regulatory decisions, findings, and determinations.

(c) The Chairman of the Board shall enforce the rules, regulations, and 

orders of the Board. Except as provided in section 518 of Title 28 of the United 

States Code, relating to litigation before the Supreme Court, attorneys designated 

by the Chairman shall represent the Farm Credit Administration in any civil 

proceeding or civil action brought in connection with the administration of 

conservatorships and receiverships. Attorneys designated by the Chairman may 

represent the Farm Credit Administration in any other civil proceedings or civil 

action when so authorized by the Attorney General under provisions of Title 28.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2245

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2245 SEC. 5.11. ORGANIZATION OF THE FARM CREDIT 

ADMINISTRATION.

(a) POLICIES OF THE BOARD. The Chairman of the Farm Credit 

Administration Board, in carrying out the powers and duties vested in the 

Chairman by this Act, and Acts supplementary thereto, shall be governed by 

policies of the Board and by such regulatory decisions, findings, and 

determinations as the Board may by law be authorized to make.

(b) APPOINTMENTS. The Chairman of the Board shall appoint such 

personnel as may be necessary to carry out the functions of the Farm Credit 

Administration. The appointment by the Chairman of the heads of major 

administrative divisions under the Board shall be subject to the approval of the 

Board.

(c) PERSONNEL.

(1) APPOINTMENTS BY BOARD MEMBERS. Personnel 

employed regularly and full-time in the immediate offices of Board 

members shall be appointed by each such Board member.

(2) OFFICERS AND EMPLOYEES.

(A) APPOINTMENT, COMPENSATION, AND 

BENEFITS. The Chairman shall fix the compensation and number 

of, and appoint and direct, employees of the Administration. The 

Chairman may set and adjust the rates of basic pay for employees of 

the Administration without regard to the provisions of chapter 51, or 

subchapter III of chapter 53, of Title 5, United States Code. The 

Chairman may provide such additional compensation and benefits to 

employees of the Administration as is necessary to maintain 

comparability with the total amount of compensation and benefits 

provided by other Federal bank regulatory agencies. In setting and 

adjusting the total amount of compensation and benefits for 

employees of the Administration, the Chairman shall consult with, 

and seek to maintain comparability with, other Federal bank 

regulatory agencies.

(B) OTHER FEDERAL BANK REGULATORY 

AGENCIES DEFINED. For purposes of this subsection, the term 

"other Federal bank regulatory agencies" has the same meaning 

given to the term "appropriate Federal banking agency" in section 

3(q) of the Federal Deposit Insurance Act.

(C) ETHICS IN GOVERNMENT. The officers and 

employees of the agency shall be—
(i) subject to the Ethics in Government Act of 1978; 

and

(ii) considered officers or employees of the United 

States for the purposes of sections 201 through 203, and 

sections 205 through 209, of Title 18, United States Code.

(3) DELEGATION. The powers of the Chairman as chief 

executive officer necessary for day to day management may be exercised 

and performed by the Chairman through such other officers and employees 

of the Administration as the Chairman shall designate, except that the 

Chairman may not delegate powers specifically reserved to the Chairman 

by this Act without Board approval.

(d) FUNDING. The operations of the Farm Credit Administration, and 

the salaries of members of the Board and employees of the Administration, shall 

be funded and paid for from the fund created under section 5.15.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2246

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2246 SEC. 5.12. ADVISORY COMMITTEES.

The Chairman of the Board, subject to the approval of the Board, may 

establish one or more advisory committees in accordance with the Federal 

Advisory Committee Act and may appoint to such committee or committees 

individuals who are members of the Federal Farm Credit Board when such Board 

is terminated by the Farm Credit Amendments Act of 1985.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2248

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2248 SEC. 5.13. SEAL.

The Farm Credit Administration shall have a seal, as adopted by the Board, 

which shall be judicially noted.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2249

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2249 SEC. 5.14. ADMINISTRATIVE EXPENSES.

The Farm Credit Administration may, within the limits of funds available 

therefor, make necessary expenditures for personnel services and rent at the seat 

of Government and elsewhere; contract stenographic reporting services; purchase 

and exchange lawbooks, books on reference, periodicals, newspapers, expenses 

of attendance at meetings and conferences; purchase, operation, and maintenance 

at the seat of Government and elsewhere of motor-propelled passenger-carrying 

vehicles and other vehicles; printing and binding; and for such other facilities and 

services, including temporary employment by contract or otherwise, as it may 

from time to time find necessary for the proper administration of this Act. The 

Farm Credit Administration may dispose of property so acquired and any 

amounts collected from the disposition of such property shall be deposited in the 

special fund provided for in section 5.15(b) of this Act and shall be available to 

the Administration in the same manner and for the same purposes as the funds 

collected under section 5.15(a) of this Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2250

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2250 SEC. 5.15. FARM CREDIT ADMINISTRATION OPERATING 

EXPENSES FUND.

(a) DETERMINATIONS REQUIRED.

(1) GENERALLY. Prior to the first day of each fiscal year, the 

Farm Credit Administration shall determine—

(A) the cost of administering this Act for the subsequent 

fiscal year, including expenses for official functions;

(B) the amount of assessments that will be required to pay 

such administrative expenses, taking into consideration the funds 

contained in the Administrative Expense Account, and maintain a 

necessary reserve; and 

(C) the amount of assessments that will be required to pay 

the costs of supervising and examining the Mortgage Corporation 

established under title VIII.

(2) APPORTIONMENTS. On the basis of the determinations 

made under paragraph (1), the Farm Credit Administration shall —

(A) apportion the amount of the assessment described in 

paragraph (1)(B) among the System institutions on a basis that is 

determined to be equitable by the Farm Credit Administration;

(B) assess and collect such apportioned amounts from time 

to time during the fiscal year as determined necessary by the Farm 

Credit Administration; and

(C) assess and collect from the Mortgage Corporation, from 

time to time during the fiscal year, the amount described in 

paragraph (1)(C).

(b) DEPOSITS INTO FUND.

(1) TREASURY FUND. The amounts collected under subsection 

(a) of this section shall be deposited in the Farm Credit Administration 

Administrative Expense Account. The Expense Account shall be 

maintained in the Treasury of the United States and shall be available, 

without regard, for purposes of sequestration, to the Balanced Budget and 

Emergency Deficit Control Act of 1985 (2 U.S.C. 901 note) to pay the 

expenses of the Farm Credit Administration.

(2) NONGOVERNMENT FUNDS. The funds contained in the 

Expense Account shall not be construed to be Federal Government funds 

or appropriated moneys.

(3) INVESTMENT.

(A) AUTHORITY. On request of the Farm Credit 

Administration, the Secretary of the Treasury shall invest and 
reinvest such amounts contained in the Expense Account as, in the 

determination of the Farm Credit Administration, are in excess of the 

amounts necessary for current expenses of the Farm Credit 

Administration.

(B) RETURNS. All income earned from such investments 

and reinvestments shall be deposited in the Expense Account.

(C) TYPE. Such investments shall be made in public debt 

securities with maturities suitable to the needs of the Expense 

Account, as determined by the Farm Credit Administration, and 

bearing interest at rates determined by the Secretary of the Treasury, 

taking into consideration current market yields on outstanding 

marketable obligations of the United States of comparable maturities.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2251

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2251 SEC. 5.16. QUARTERS AND FACILITIES FOR THE FARM 

CREDIT ADMINISTRATION.

As an alternate to the rental of quarters under section 5.14, and without 

regard to any other provision of law, the banks of the System, with the 

concurrence of two-thirds of the bank boards, are hereby authorized—

(1) To lease or acquire real property in the District of Columbia or 

elsewhere for quarters of the Farm Credit Administration.

(2) To construct, develop, furnish, and equip such building thereon 

and such facilities appurtenant thereto as in their judgment may be 

appropriate to provide, to the extent the Board may deem advisable, 

suitable, and adequate quarters and facilities for the Farm Credit 

Administration.

(3) To enlarge, remodel, or reconstruct the same.

(4) To make or enter into contracts for any of the foregoing.

(5) To sell or otherwise dispose of any interest in property leased 

or acquired under the foregoing if authorized by the Board.

The Board may require of the respective banks of the System, and they 

shall make to the Farm Credit Administration, such advances of funds for the 

purposes set out in this section as in sole judgment of the Board may from time to 

time be advisable for the purposes of this section. Such advances shall be in 

addition to and kept in a separate fund from the assessments authorized in section 

5.15 and shall be apportioned by the Board among the banks in proportion to the 

total assets of the respective banks, and determined in such manner and at such 

times as the Board may prescribe. The powers of the banks of the System and 

purposes for which obligations may be issued by such banks are hereby enlarged 

to include the purpose of obtaining funds to permit the making of advances 

required by this section. The plans and decisions for such building and facilities 

and for the enlargement, remodeling, or reconstruction thereof shall be such as is 

approved in the sole discretion of the Board. In actions undertaken by the banks 

pursuant to the foregoing provisions of this section, the Farm Credit 

Administration may act as agent for the banks.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2252

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2252 SEC. 5.17. ENUMERATED POWERS.

(a) The Farm Credit Administration shall have the following powers, 

functions, and responsibilities in connection with the institutions of the Farm 

Credit System and the administration of this Act:

(1) Modify the boundaries of farm credit districts, with due regard 

for the farm credit needs of the country, as approved by the Board, with the 

concurrence of the district banks involved.

(2) Where necessary or appropriate to carry out the policy and 

objectives of this Act, issue and approve amendments to Federal charters of 

institutions of the System; approve change in names of banks operating 

under this Act; approve the merger of districts when agreed to by the 

district bank boards involved and by a majority vote of the voting 

stockholders and contributors to the guaranty funds of each bank for each 

of such districts, voting in the same manner as is provided in section 7.0 of 

this Act; approve mergers and any related activities as provided for in title 

VII; and approve the consolidation or division of the territories of 

institutions when agreed to by a majority vote of the voting stockholders or 

contributors to the guaranty fund of each of the institutions involved; and 

approve consolidations of boards of directors when agreed to by a majority 

vote of the voting stockholders or contributors to the guaranty fund of each 

of the institutions involved. In issuing charters and certificates of territory 

for district-wide mergers of associations where stockholders of one or more 

associations did not approve the merger, the charter of the new or merged 

association shall not include the territory of the disagreeing association or 

associations; charters issued during calendar year 1985 for district-wide 

new or merged associations which included the territory of a disagreeing 

association shall be revoked and reissued to exclude such territory, unless 

subsequently agreed to by the board of directors of such association or 

associations. The Farm Credit Administration Board shall ensure that 

disapproving associations (A) shall not be charged any assessment under 

this Act at a rate higher than that charged other like associations in the 

district, and (B) shall be provided with financial services and assistance on 

the same basis as other like associations in the district (including, but not 

limited to, access to credit and rates of interest on loans and discounts) by a 

district Farm Credit bank to the association and its member-borrowers. 

The Farm Credit Administration Board, after consultation with the 

respective boards of directors of the affected banks, may require two or 

more banks operating under the same or different titles to merge if the 
Board determines that one of such banks has failed to meet its outstanding 

obligations. 

(3) Make annual reports directly to Congress on the condition of the 

System and its institutions, based on the examinations carried out under 

section 5.19 of this Act, and on the manner and extent to which the 

purposes and objectives of this Act are being carried out and, from time to 

time, recommend directly legislative changes. The annual reports shall 

include a summary and analysis of the reports submitted to the Farm Credit 

Administration by the Farm Credit Banks under section 4.19(b) relating to 

programs for serving young, beginning, and small farmers and ranchers.

(4) Approve the issuance of obligations of the System under 

subsections (c) and (d) of section 4.2 of this Act for the purpose of funding 

the authorized operations of the institutions of the System, and prescribe 

collateral therefor.

(5) Grant approvals provided for under this Act either on a caseby-case basis or through regulations that confer approval on actions of 

Farm Credit System institutions. 

(6) Establish standards for the System institutions with respect to 

loan security requirements and regulate the borrowing, repayment, and 

transfer of funds and equities between institutions of the System.

(7) Conduct loan and collateral security review.

(8) Regulate the preparation by System institutions and the 

dissemination to stockholders and investors of information on the financial 

condition and operations of such institutions, except that the requirements 

of the Farm Credit Administration governing the dissemination to 

stockholders of quarterly reports of System institutions may not be more 

burdensome or costly than the requirements applicable to national banks, 

and the Farm Credit Administration may not require any System institution 

to disclose in any report to stockholders information concerning the 

condition or classification of a loan—

(A) to a director of the institution—

(i) who has resigned before the time for filing the 

applicable report with the Farm Credit Administration; or

(ii) whose term of office will expire no later than the 

date of the meeting of stockholders to which the report relates; 

or 

(B) to a member of the immediate family of a director of the 

institution unless—

(i) the family member resides in the same household 

as the director; or

(ii) the director has a material financial or legal 

interest in the loan or business operation of the family member.

(9) Prescribe rules and regulations necessary or appropriate for 

carrying out this Act.

(10) Exercise the powers conferred on it under part C of this title 

for the purpose of ensuring the safety and soundness of System institutions.

(11) Exercise such incidental powers as may be necessary or 

appropriate to fulfill its duties and carry out the purposes of this Act.

(12) Require surety bonds or other provisions for protection of the 

assets of the institutions of the System against losses occasioned by 

employees.
(13)(A) Subject to subparagraph (B), the Farm Credit 

Administration may approve an amendment to the charter of any institution 

of the Farm Credit System operating under title I or II, which would 

authorize the institution to exercise lending authority in any territory—

(i) in the geographic area served by an association 

that was reassigned pursuant to section 433 of the Agricultural 

Credit Act of 1987 (12 U.S.C. 2071 note) (where the 

geographic area was a part of the association's territory as of 

the date of the reassignment); and

(ii) in which the charter of an institution that is not 

seeking the charter amendment authorizes the institution to 

exercise the type of lending authority that is the subject of the 

charter request.

(B) The Farm Credit Administration may approve a charter 

amendment under subparagraph (A) only on the approval of—

(i) the respective boards of directors of the 

associations that, if the charter request is approved, would 

exercise like lending authority in any of the territory that is the 

subject of the charter request;

(ii) a majority of the stockholders of each association 

described in clause (i) voting, in person or by proxy, at a duly 

authorized stockholder's meeting; and

(iii) the respective boards of directors of the Farm 

Credit Banks that, if the charter request is approved, would 

exercise, either directly or through associations, like lending 

authority in any of the territory described in subparagraph 

(A)(i).

(14)(A) Subject to subparagraph (B), the Farm Credit 

Administration may approve a request to charter an association of the Farm 

Credit System to operate under title II where the proposed charter—

(i) will include any of the geographic area included in 

the territory served by an association that was reassigned 

pursuant to section 433 of the Agricultural Credit Act of 1987 

(12 U.S.C. 2071 note) (where the geographic area was a part of 

the association's territory as of the date of the reassignment); 

and

(ii) will authorize the association to exercise lending 

authority in any territory in the geographic area in which the 

charter of an association that is not requesting the charter 

authorizes the association to exercise the type of lending 

authority that is the subject of the charter request.

(B) The Farm Credit Administration may approve a charter 

request under subparagraph (A) only on the approval of—

(i) the respective boards of directors of the 

association that, if the charter request is approved, would 

exercise like lending authority in any of the territory that is the 

subject of the charter request;

(ii) a majority vote of the stockholders (if any) of each 

association described in clause (i) voting, in person or by 

proxy, at a duly authorized stockholder's meeting; and
(iii) the respective boards of directors of the Farm 

Credit Banks that, if the charter request is approved, would 

exercise, either directly or through associations, like lending 

authority in any of the territory described in subparagraph 

(A)(i).

(15)(A) Approve amendments to the charters of institutions of the 

Farm Credit System to implement the equalization of loanmaking powers of a Farm Credit System association under 

section 7.7.

(B) Amendment described in subparagraph (A) to the 

charters of an association and the related Farm Credit Bank shall be 

approved by the Farm Credit Administration, subject to any 

conditions of approval imposed, by not later than 30 days after the 

date on which the Farm Credit Administration receives all approvals 

required by section 7.7(a)(2).

(b) The Farm Credit Administration shall not have authority, either 

direct or indirect, to approve bylaws, or any amendments or modifications or 

changes to bylaws, of System institutions.

(c)(1) At least thirty days prior to publishing any proposed regulation in 

the Federal Register, the Farm Credit Administration shall transmit a copy of the 

regulation to the Committee on Agriculture of the House of Representatives and 

the Committee on Agriculture, Nutrition, and Forestry of the Senate. The Farm 

Credit Administration shall also transmit to such committees a copy of any final 

regulation prior to its publication in the Federal Register. Except as provided in 

paragraph (2) of this subsection, no final regulation of the Farm Credit 

Administration shall become effective prior to the expiration of thirty calendar 

days after it is published in the Federal Register during which either or both 

Houses of the Congress are in session.

(2) In the case of an emergency, a final regulation of the Farm 

Credit Administration may become effective without regard to the last 

sentence of paragraph (1) of this subsection if the Farm Credit 

Administration notifies in writing the Committee on Agriculture of the 

House of Representatives and the Committee on Agriculture, Nutrition, 

and Forestry of the Senate setting forth the reasons why it is necessary to 

make the regulation effective prior to the expiration of the thirty-day period.

(d)(1) If there are any unresolved differences between the Farm Credit 

Administration and the Board of Governors of the Federal Reserve System as to 

whether any regulation implementing section 3.7(b) or the other provisions of 

title III relating to the authority under section 3.7(b) conforms to national 

banking policies, objectives, and limitations, simultaneously with promulgation 

of any such regulation under this Act and simultaneously with promulgation of 

any regulation implementing 1.7(b), the Farm Credit Administration shall 

transmit a copy thereof to the Secretary of the Senate and the Clerk of the House 

of Representatives. Except as provided in paragraph (2), the regulation shall not 

become effective if, within ninety calendar days of continuous session of 

Congress after the date of promulgation, both Houses of Congress adopt a 

concurrent resolution, the matter after the resolving clause of which is as follows: 

"That Congress disapproves the regulations promulgated by the Farm Credit 

Administration dealing with the matter of , which regulation was 

transmitted to Congress on ", the blank spaces therein being appropriately 

filled.
(2) If at the end of sixty calendar days of continuous session of 

Congress after the date of promulgation of a regulation, no committee of 

either House of Congress has reported or been discharged from further 

consideration of a concurrent resolution disapproving the regulation, and 

neither House has adopted such a resolution, the regulation may go into 

effect immediately. If, within such sixty calendar days, such a committee 

has reported or been discharged from further consideration of such a 

resolution, or either House has adopted such a resolution, the regulation 

may go into effect not sooner than ninety calendar days of continuous 

session of Congress after its promulgation unless disapproved as provided 

in paragraph (1).

(3) For the purposes of paragraphs (1) and (2) of this subsection—

(i) continuity of session is broken only by an 

adjournment of Congress sine die; and

(ii) the days on which either House is not in session 

because of adjournment of or more than three days to a day 

certain are excluded in the computation of sixty and ninety 

calendar days of continuous session of Congress.

(4) Congressional inaction on or rejection of a resolution of 

disapproval shall not be deemed an expression of approval of such 

regulation.

NOTE: The amendments made by section 5407 of Public Law 110-246 

became effective on January 1, 2010. 
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2253

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2253 SEC. 5.18. PRIOR DELEGATIONS.

Any delegations by the Farm Credit Administration and redelegations 

thereof made in accordance with section 5.19 of the Farm Credit Act of 1971 as 

in effect prior to the effective date of the Farm Credit Amendments Act of 1985 

may continue in full force and effect, at the discretion of the Farm Credit 

Administration, for the period ending twelve months after the date of enactment 

of such Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2254

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2254 SEC. 5.19. EXAMINATIONS.

(a) Except for Federal land bank associations, each institution of the 

System shall be examined by Farm Credit Administration examiners at such 

times as the Board may determine, but in no event less than once during each 18-

month period. Each Federal land bank association shall be examined by Farm 

Credit Administration examiners at such times as the Farm Credit Administration 

Board may determine, except that each such association shall be examined at 

least once every three years. Such examinations may include, if appropriate, but 

are not limited to, an analysis of credit and collateral quality and capitalization of 

the institution, and appraisals of the effectiveness of the institutions management 

and application of policies governing the carrying out of this Act and regulations 

of the Farm Credit Administration and servicing all eligible borrowers. 

Examination of banks shall include an analysis of the compensation paid to the 

chief executive officer and the salary scales of the employees of the bank. At the 

direction of the Board, Farm Credit Administration examiners also shall make 

examinations of the condition of any organization, other than federally regulated 

financial institutions, to, for, or with which any institution of the System 

contemplates making a loan or discounting paper. For the purposes of this Act, 

examiners of the Farm Credit Administration shall be subject to the same 

requirements, responsibilities, and penalties as are applicable to examiners under 

the National Bank Act, the Federal Reserve Act, and Federal Deposit Insurance 

Act, and other provisions of law and shall have the same powers and privileges 

as are vested in such examiners by law.

(b)(1) Each institution of the System shall make and publish an annual 

report of condition as prescribed by the Farm Credit Administration. Each such 

report shall contain financial statements prepared in accordance with generally 

accepted accounting principles, except with respect to any actions taken by any 

banks of the System under section 4.8(b), and contain such additional 

information as the Farm Credit Administration by regulation may require. 

Notwithstanding the provisions of the preceding sentence and any other provision 

of this Act, for the period July 1, 1986, through December 31, 1988, the 

institutions of the Farm Credit System may, on the prior approval of the Farm 

Credit Administration and subject to such conditions as it may establish, 

capitalize annually their provision for losses that is in excess of one-half of 1 

percent of loans outstanding and amortize such capitalized amounts over a period 

not to exceed 20 years. Such financial statements of System institutions shall be 

audited by an independent public accountant.

(2) In accordance with the regulations of the Farm Credit 

Administration, for the period ending December 31, 1992, System 
institutions are authorized to use the authorities contained in the third 

sentence of paragraph (1) except as otherwise provided in section 6.6.

(3) Any preferred stock issued under section 6.27 shall be 

subordinated to, and impaired before, other stock or equities of the 

institution.

(c) The Farm Credit Administration may publish the report of 

examination of any System institution that does not, before the end of the 120th 

day after the date of notification of the recommendations and suggestions of the 

Farm Credit Administration, based on such examination, comply with such 

recommendations and suggestions to the satisfaction of the Farm Credit 

Administration. The Farm Credit Administration shall give notice of intention to 

publish in the event of such noncompliance at least 90 days before such 

publication. Such notice of intention may be given any time after such 

notification of recommendations and suggestions.

(d) On receipt of a request made under section 5.59(b)(1)(B) with 

respect to a System institution, the Farm Credit Administration shall

(1) furnish for the confidential use of the Farm Credit System 

Insurance Corporation reports of examination of the institution and other 

reports or information on the institution; and

(2)(A) examine, or obtain other information on, the institution and 

furnish for the confidential use of the Farm Credit System Insurance 

Corporation the report of the examination and such other information; or

(B) if the Farm Credit Administration Board determines that 

compliance with the request would substantially impair the ability of 

the Farm Credit Administration to carry out the other duties and 

responsibilities of the Farm Credit Administration under this Act, 

notify the Board of Directors of the Farm Credit System Insurance 

Corporation that the Farm Credit Administration will be unable to 

comply with the request.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2255

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2255 SEC. 5.20. CONDITIONS OF OTHER BANKS AND LENDING

INSTITUTIONS.

The Comptroller of the Currency is authorized and directed, upon request 

of the Farm Credit Administration to furnish for confidential use of an institution 

of the System such reports, records, and other information as he may have 

available relating to the financial condition of national banks through, for, or with 

which such institution of the System has made or contemplates making discounts 

or loans and to make such further examination, as may be agreed, of 

organizations through, for, or with which such institution of the Farm Credit 

System has made or contemplates making discounts or loans.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2256

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2256 SEC. 5.21. CONSENT TO THE AVAILABILITY OF REPORTS 

AND TO EXAMINATIONS.

Any organization other than State banks, trust companies, and savings 

associations shall, as a condition precedent to securing discount privileges with a 

bank of the Farm Credit System, file with such bank its written consent to 

examination by farm credit examiners as may be directed by the Farm Credit 

Administration; and State banks, trust companies, and savings associations may 

be required in like manner to file a written consent that reports of their 

examination by constituted State authorities may be furnished by such authorities 

upon the request of the Farm Credit Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2257

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2257 SEC. 5.22. REPORTS ON CONDITIONS OF INSTITUTIONS

RECEIVING LOANS OR DEPOSITS.

The executive departments, boards, commissions, and independent 

establishments of the Government of the United States, the Federal Deposit 

Insurance Corporation, the Comptroller of the Currency, the Board of Governors 

of the Federal Reserve System, and the Federal Reserve banks are severally 

authorized under such conditions as they may prescribe, upon request of the 

Farm Credit Administration, to make available to it or to any institution of the 

System in confidence all reports, records, or other information relating to the 

condition of any organization to which such institution of the System has made 

or contemplates making loan or for which it has or contemplates discounting 

paper, or which it is using or contemplates using as a custodian of securities or 

other credit instruments, or a depository. The Federal Reserve banks in their 

capacity as depositories, agents, and custodians for bonds, debentures, and other 

obligations issued by the banks of the System or book entries thereof are also 

authorized and directed, upon request of the Farm Credit Administration, to make 

available for audit by farm credit examiners all appropriate books, accounts, 

financial records, files, and other papers.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2257a

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2257a SEC. 5.22A. UNIFORM FINANCIAL REPORTING 

INSTRUCTIONS.

(a) IN GENERAL. Each System institution shall comply with uniform 

financial reporting instructions required by the Farm Credit Administration, to 

standardize and facilitate the reporting of System data.

(b) COMPUTERIZED SYSTEM. If the financial reports are maintained 

by a computer system, each System institution may develop an internal computer 

system or it may contract out to a vendor under open competitive bidding any or 

all aspects of the computerized system.

(c) SUBMISSION OF PROPOSAL. Within 6 months of the date of the 

enactment of this section, each System institution shall submit to the Farm Credit 

Administration a report on the plan of that institution to bring the operations of 

the institution into compliance with the uniform financial reporting instructions 

required by the Farm Credit Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2258

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2258 SEC. 5.23. JURISDICTION.

Each institution of the System shall for the purposes of jurisdiction be 

deemed to be a citizen of the State, commonwealth, or District of Columbia in 

which its principal office is located.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part B Farm Credit Administration Organization

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2259

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2259 SEC. 5.24. STATE LEGISLATION.

Whenever it is determined by the Farm Credit Administration, or by 

judicial decision, that a State law is applicable to the obligations and securities 

authorized to be held by the institutions of the System under this Act, which law 

would provide insufficient protection, or inadequate safeguards against loss in 

the event of default, the Farm Credit Administration may declare such 

obligations or securities to be ineligible as collateral for the issuance of new 

notes, bonds, debentures, and other obligations under this Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2261

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part C—Enforcement Powers of Farm Credit Administration

12 U.S.C. 2261 SEC. 5.25. CEASE AND DESIST PROCEEDINGS.

(a) If, in the opinion of the Farm Credit Administration, any institution 

in the Farm Credit System, or any director, officer, employee, agent, or other 

person participating in the conduct of the affairs of such an institution is 

engaging or has engaged, or the Farm Credit Administration has reasonable cause 

to believe that the institution or any director, officer, employee, agent, or other 

person participating in the conduct of the affairs of such institution is about to 

engage, in an unsafe or unsound practice in conducting the business of such 

institution, or is violating or has violated, or the Farm Credit Administration has 

reasonable cause to believe that the institution or any director, officer, employee, 

agent, or other person participating in the conduct of the affairs of such 

institution is about to violate, a law, rule, or regulation, or any condition imposed 

in writing by the Farm Credit Administration in connection with the granting of 

any application or other request by the institution or any written agreement 

entered into with the Farm Credit Administration, the Farm Credit 

Administration may issue and serve upon the institution or such director, officer, 

employee, agent, or other person a notice of charges in respect thereof. The 

notice shall contain a statement of the facts constituting the alleged violation or 

violations or the unsafe or unsound practice or practices, and shall fix a time and 

place at which a hearing will be held to determine whether an order to cease and 

desist therefrom should issue against the institution or the director, officer, 

employee, agent, or other person participating in the conduct of the affairs of 

such institution. Such hearing shall be fixed for a date not earlier than thirty days 

nor later than sixty days after service of such notice unless an earlier or a later 

date is set by the Farm Credit Administration at the request of any party so 

served. Unless the party or parties so served shall appear at the hearing 

personally or by a duly authorized representative, they shall be deemed to have 

consented to the issuance of the cease and desist order. In the event of such 

consent, or if upon the record made at any such hearing, the Farm Credit 

Administration shall find that any violation or unsafe or unsound practice 

specified in the notice of charges has been established, the Farm Credit 

Administration may issue and serve upon the institution or the director, officer, 

employee, agent, or other person participating in the conduct of the affairs of 

such institution an order to cease and desist from any such violation or practice. 

Such order may, by provisions that may be mandatory or otherwise, require the 

institution or its directors, officers, employees, agents, and other persons 

participating in the conduct of the affairs of such institution to cease and desist 
from the same, and, further, to take affirmative action to correct the conditions 

resulting from any such violation or practice.

(b) A cease and desist order shall become effective at the expiration of 

thirty days after the service of such order upon the institution or other person 

concerned (except in the case of a cease and desist order issued upon consent, 

which shall become effective at the time specified therein), and shall remain 

effective and enforceable as provided therein except to such extent as it is stayed, 

modified, terminated, or set aside by action of the Farm Credit Administration or 

a reviewing court.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2262

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2262 SEC. 5.26. TEMPORARY CEASE AND DESIST ORDERS.

(a) Whenever the Farm Credit Administration shall determine that the 

violation or threatened violation or the unsafe or unsound practice or practices, 

specified in the notice of charges served upon the institution or any director, 

officer, employee, agent, or other person participating in the conduct of the 

affairs of such institution under section 5.25, or the continuation thereof, is likely 

to cause insolvency or substantial dissipation of assets or earnings of the 

institution, or is likely to seriously weaken the condition of the institution or 

otherwise seriously prejudice the interests of the investors in Farm Credit System 

obligations or shareholders in the institution prior to the completion of the 

proceedings conducted under section 5.25, the Farm Credit Administration may 

issue a temporary order requiring the institution or such director, officer,

employee, agent, or other person to cease and desist from any such violation or 

practice and to take affirmative action to prevent such insolvency, dissipation, 

condition, or prejudice pending completion of such proceedings. Such order 

shall become effective upon service upon the institution or such director, officer, 

employee, agent, or other person participating in the conduct of the affairs of 

such institution and, unless set aside, limited, or suspended by a court in 

proceedings authorized by subsection (b) of this section, shall remain effective 

and enforceable pending the completion of the administrative proceedings 

pursuant to such notice and until such time as the Farm Credit Administration 

shall dismiss the charges specified in such notice, or if a cease and desist order is 

issued against the institution or such director, officer, employee, agent, or other 

person, until effective date of such order.

(b) Within ten days after the institution concerned or any director, 

officer, employee, agent, or other person participating in the conduct of the 

affairs of such institution has been served with a temporary cease and desist order, 

the institution or such director, officer, employee, agent, or other person may 

apply to the United States district court for the judicial district in which the home 

office of the institution is located, or the United States district court for the 

District of Columbia, for an injunction setting aside, limiting, or suspending the 

enforcement, operation, or effectiveness of such order pending the completion of 

the administrative proceedings pursuant to the notice of charges served upon the 

institution or such director, officer, employee, agent, or other person under 

section 5.25, and such court shall have jurisdiction to issue such injunction.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2263

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2263 SEC. 5.27. ENFORCEMENT OF TEMPORARY CEASE AND

DESIST ORDERS.

In the case of violation or threatened violation of, or failure to obey, a 

temporary cease and desist order issued under section 5.26, the Farm Credit 

Administration may apply to the United States district court, or the United States 

court of any territory, within the jurisdiction of which the home office of the 

institution is located, for an injunction to enforce such order, and, if the court 

shall determine that there has been such violation or threatened violation or 

failure to obey, it shall be the duty of the court to issue such injunction.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2264

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2264 SEC. 5.28. SUSPENSION OR REMOVAL OF DIRECTOR OR

OFFICER.

(a) Whenever, in the opinion of the Farm Credit Administration, any 

director or officer of any institution in the Farm Credit System has committed 

any violation of law, rule, or regulation or of a cease and desist order that has 

become final, or has engaged or participated in any unsafe or unsound practice in 

connection with the institution, or has committed or engaged in any act, omission, 

or practice which constitutes a breach of a fiduciary duty as such director or 

officer, and the Farm Credit Administration determines that the institution has 

suffered or will probably suffer substantial financial loss or other damage or that 

the interests of its shareholders or investors in Farm Credit System obligations 

could be seriously prejudiced by reason of such violation or practice or breach of 

fiduciary duty, or that the director or officer has received financial gain by reason 

of such violation or practice or breach of fiduciary duty, and that such violation 

or practice or breach of fiduciary duty is one involving personal dishonesty on 

the part of such director or officer, or one that demonstrates a willful or 

continuing disregard for the safety or soundness of the System institution, the 

Farm Credit Administration may serve upon such director or officer a written 

notice of its intention to remove him from office.

(b) Whenever, in the opinion of the Farm Credit Administration, any 

director or officer of an institution in the Farm Credit System, by conduct or 

practice with respect to another institution in the Farm Credit System or other 

business institution that resulted in substantial financial loss or other damage, has 

evidenced either his personal dishonesty or a willful or continuing disregard for 

its safety and soundness and, in addition, has evidenced his unfitness to continue 

as a director or officer, and whenever, in the opinion of the Farm Credit 

Administration, any other person participating in the conduct of the affairs of an 

institution in the Farm Credit System, by the conduct or practice with respect to 

such institution or other institution in the Farm Credit System or other business 

institution that resulted in substantial financial loss or other damage, has 

evidenced either personal dishonesty or a willful or continuing disregard for its 

safety and soundness and, in addition, has evidenced his unfitness to participate 

in the conduct of the affairs of such institution, the Farm Credit Administration 

may serve upon such director, officer, or other person a written notice of its 

intention to remove that director, officer, or other person from office or to 

prohibit his further participation in any manner in the conduct of the affairs of the 

institution.

(c) In respect to any director or officer of an institution in the Farm 

Credit System or any other person referred to in subsection (a) or (b) of this 
section, the Farm Credit Administration may, if it deems it necessary for the 

protection of the institution or the interests of its shareholders and the investors in 

the Farm Credit System obligations, by written notice to such effect served upon 

such director, officer, or other person, suspend such director, officer, or other 

person from office or prohibit such director, officer, or other person from further 

participation in any manner in the conduct of the affairs of the institution. Such 

suspension or prohibition shall become effective upon service of such notice and, 

unless stayed by a court in proceedings authorized by subsection (e) of this 

section, shall remain in effect pending the completion of the administrative 

proceedings pursuant to the notice served under subsection (a) or (b) of this 

section and until such time as the Farm Credit Administration shall dismiss the 

charges specified in such notice, or, if an order of removal or prohibition is 

issued against the director or officer or other person, until the effective date of 

any such order. Copies of any such notice shall also be served upon the 

institution of which the person is a director or officer or in the conduct of whose 

affairs the person has participated.

(d) A notice of intention to remove a director, officer, or other person 

from office or to prohibit such director's, officer's, or other person's participation 

in the conduct of the affairs of an institution in the Farm Credit System, shall 

contain a statement of the facts constituting grounds therefor, and shall fix a time 

and place at which a hearing will be held thereon. Such hearing shall be fixed for 

a date not earlier than thirty days nor later than sixty days after the date of service 

of such notice, unless an earlier or a later date is set by the Farm Credit 

Administration at the request of (1) such director or officer or other person, and 

for good cause shown, or (2) the Attorney General of the United States. Unless 

such director, officer, or other person shall appear at the hearing in person or by a 

duly authorized representative, such director, officer, or other person shall be 

deemed to have consented to the issuance of an order of such removal or 

prohibition. In the event of such consent, or if upon the record made at any such 

hearing the Farm Credit Administration shall find that any of the grounds 

specified in such notice have been established, the Farm Credit Administration 

may issue such orders of suspension or removal from office, or prohibition from 

participation in the conduct of the affairs of the institution, as it may deem 

appropriate. A copy of an order issued under this subsection shall be served 

upon the institution concerned. Any such order shall become effective at the 

expiration of thirty days after service upon such institution and the director, 

officer, or other person concerned (except in the case of an order issued upon 

consent, which shall become effective at the time specified therein). Such order 

shall remain effective and enforceable except to such extent as it is stayed, 

modified, terminated, or set aside by action of the agency or a reviewing court.

(e) Within ten days after any director, officer, or other person has been 

suspended from office or prohibited from participation in the conduct of the 

affairs of a System institution under subsection (c) of this section, such director, 

officer, or other person may apply to the United States district court for the 

judicial district in which the home office of the institution is located, or the 

United States district court for the District of Columbia, for a stay of either such 

suspension or prohibition, or both, pending the completion of the administrative 

proceedings pursuant to the notice served upon such director, officer, or other 

person under subsection (a) or (b) of this section, and such court shall have 

jurisdiction to stay either such suspension or prohibition, or both.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2265

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2265 SEC. 5.29. SUSPENSION OR REMOVAL OF DIRECTOR OR

OFFICER CHARGED WITH FELONY.

(a) Whenever any director or officer of an institution in the Farm Credit 

System, or other person participating in the conduct of the affairs of such 

institution, is charged in any information, indictment, or complaint authorized by 

a United States attorney, with the commission of or participation in a crime 

involving dishonesty or breach of trust that is punishable by imprisonment for a 

term exceeding one year under State or Federal law, the Farm Credit 

Administration may, if continued service or participation by the individual may 

pose a threat to the interests of the institution's shareholders or investors in Farm 

Credit System obligations or may threaten to impair public confidence in the 

institution or the Farm Credit System, by written notice served upon such 

director, officer, or other person, suspend such director, officer, or other person 

from office or prohibit such director, officer, or other person from further 

participation in any manner in the conduct of the affairs of the institution. A 

copy of such notice shall also be served upon the institution. Such suspension or 

prohibition shall remain in effect until such information, indictment, or complaint 

is finally of or until terminated by the Farm Credit Administration. In the event 

that a judgment of conviction with respect to such crime is entered against such 

director, officer, or other person, and at such time as such judgment is not subject 

to further appellate review, the Farm Credit Administration may, if continued 

service or participation by the individual may pose a threat to the interests of the 

institution's shareholders or the investors in Farm Credit System obligations or 

may threaten to impair public confidence in the institution or the Farm Credit 

System, issue and serve upon such director, officer, or other person an order 

removing such director, officer, or other person from office or prohibiting such 

director, officer, or other person from further participation in any manner in the 

conduct of the affairs of the institution except with the consent of the Farm Credit 

Administration. A copy of such order shall also be served upon such institution, 

whereupon such director or officer shall cease to be a director or officer of such 

institution. A finding of not guilty or other disposition of the charge shall not 

preclude the Farm Credit Administration from thereafter instituting proceedings 

to remove such director, officer, or other person from office or to prohibit further 

participation in Farm Credit System affairs under section 5.28. Any notice of 

suspension or order of removal issued under this paragraph shall remain effective 

and outstanding until the completion of any hearing or appeal authorized under 

subsection (b) of this section unless terminated by the Farm Credit 

Administration.
(b) Within thirty days from service of any notice of suspension or order 

of removal issued under subsection (a) of this section, the director, officer, or 

other person concerned may request in writing an opportunity to appear before 

the Farm Credit Administration to show that the continued service to or 

participation in the conduct of the affairs of the institution by such individual 

does not, or is not likely to, pose a threat to the interest of the institution's 

shareholders or the investors in Farm Credit System obligations or threaten to 

impair public confidence in the institution or the Farm Credit System. Upon 

receipt of any such request, the Farm Credit Administration shall fix a time (not 

more than thirty days after receipt of such request, unless extended at the request 

of the concerned director, officer, or other person) and place at which the director, 

officer, or other person may appear, personally or through counsel, before the 

Chairman of the Farm Credit Administration or designated employees of the 

Farm Credit Administration to submit written materials (or, at the discretion of 

the Farm Credit Administration oral testimony) and oral argument. Within sixty 

days of such hearing, the Farm Credit Administration shall notify the director, 

officer, or other person whether the suspension or prohibition from participation 

in any manner in the conduct of the affairs of the institution will be continued, 

terminated, or otherwise modified, or whether the order removing such director, 

officer, or other person from office or prohibiting such individual from further 

participation in any manner in the conduct of the affairs of the institution will be 

rescinded or otherwise modified. Such notification shall contain a statement of 

the basis for the Farm Credit Administrations decision, if adverse to the director, 

officer or other person. The Farm Credit Administration may prescribe such 

rules as may be necessary to effectuate the purposes of this subsection.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2266

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2266 SEC. 5.30. HEARINGS AND JUDICIAL REVIEW.

(a) Any hearing provided for in this part (other than the hearing 

provided for in section 5.29) shall be held in the Federal judicial district or in the 

territory in which the home office of the institution is located unless the party 

afforded the hearing consents to another place, and shall be conducted in 

accordance with the provisions of chapter 5 of Title 5 of the United States Code. 

Such hearing shall be private, unless the Farm Credit Administration, in its 

discretion, after fully considering the views of the party afforded the hearing, 

determines that a public hearing is necessary to protect the public interest. After 

such hearing, and within ninety days after the Farm Credit Administration has 

notified the parties that the case has been submitted to it for final decision, it shall 

render its decision (which shall include findings of fact upon which its decision is 

predicated) and shall issue and serve upon each party to the proceeding an order 

or orders consistent with the provisions of this part. Judicial review of any such 

order shall be exclusively as provided in this section. Unless a petition for 

review is timely filed in a court of appeals of the United States, as hereinafter 

provided in subsection (b) of this section, and thereafter until the record in the 

proceeding has been filed as so provided, the Farm Credit Administration may at 

any time, upon such notice and in such manner as it shall deem proper, modify, 

terminate, or set aside any such order. Upon such filing of the record, the Farm 

Credit Administration may modify, terminate, or set aside any such order with 

permission of the court.

(b) Any party to the proceeding, or any person required by an order 

issued under this part to cease and desist from any of the violations or practices 

stated therein, may obtain a review of any order served under subsection (a) of 

this section (other than an order issued with the consent of the System institution 

or the director or officer or other person concerned, or an order issued under 

section 5.29) by the filing in the court of appeals of the United States for the 

circuit in which the home office of the institution is located, or in the United 

States Court of Appeals for the District of Columbia Circuit, within thirty days 

after the date of service of such order, a written petition praying that the order of 

the Farm Credit Administration be modified, terminated, or set aside. A copy of 

such petition shall be forthwith transmitted by the clerk of the court to the Farm 

Credit Administration, and thereupon the Farm Credit Administration shall file in 

the court the record in the proceeding, as provided in section 2112 of title 28 of 

the United States Code. Upon the filing of such petition, such court shall have 

jurisdiction, which upon the filing of the record shall except as provided in the 

last sentence of subsection (a) of this section be exclusive, to affirm, modify, 

terminate, or set aside, in whole or in part, the order of the Farm Credit 
Administration. Review of such proceedings shall be had as provided in chapter 

7 of Title 5 of the United States Code. The judgment and decree of the court 

shall be final, except that the same shall be subject to review by the Supreme 

Court upon certiorari, as provided in section 1254 of Title 28 of the United States 

Code.

(c) The commencement of proceedings for judicial review under 

subsection (b) of this section shall not, unless specifically ordered by the court, 

operate as a stay of any order issued by the Farm Credit Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2267

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2267 SEC. 5.31. JURISDICTION AND ENFORCEMENT.

The Farm Credit Administration may in its discretion apply to the United 

States district court, or the United States court of any territory, within the 

jurisdiction of which the home office of the institution is located, for the 

enforcement of any effective and outstanding notice or order issued under this 

part, and such courts shall have jurisdiction and power to order and require 

compliance herewith; but except as otherwise provided in this part no court shall 

have jurisdiction to affect by injunction or otherwise the issuance or enforcement 

of any notice or order under this part, or to review, modify, suspend, terminate, 

or set aside any such notice or order. For purposes of this section, any directive 

issued under section 4.3(b)(2), 4.3A(e), or 4.14(i) shall be treated as an effective 

and outstanding order issued under section 5.25 that has become final.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2268

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2268 SEC. 5.32. PENALTY.

(a) Any institution in the System that violates or any officer, director, 

employee, agent, or other person participating in the conduct of the affairs of 

such an institution who violates the terms of any order that has become final and 

was issued under section 5.25 or 5.26 of this Act, shall forfeit and pay a civil 

penalty of not more than $1,000 per day for each day during which such violation 

continues. Any such institution or person who violates any provision of this Act 

or any regulation issued under this Act shall forfeit and pay a civil penalty of not 

more than $500 per day for each day during which such violation continues. 

Notwithstanding the preceding sentences, the Farm Credit Administration may, 

in its discretion, compromise, modify, or remit any civil money penalty that is 

subject to imposition or has been imposed under such authority. The penalty 

may be assessed and collected by the Farm Credit Administration by written 

notice.

(b) Before determining whether to assess a civil money penalty and 

determining the amount of such penalty, the Farm Credit Administration shall 

notify the institution or person to be assessed of the violation or violations 

alleged to have occurred or to be occurring, and shall solicit the views of the 

institution or person regarding the imposition of such penalty. In determining the 

amount of the penalty, the Farm Credit Administration shall take into account the 

appropriateness of the penalty with respect to the size of financial resources and 

good faith of the System institution or person charged, the gravity of the violation, 

the history of previous violations, and such other matters as justice may require.

(c) The System institution or person assessed shall be afforded an 

opportunity for a hearing by the Farm Credit Administration, upon request made 

within ten days after issuance of the notice of assessment. In such hearing all 

issues shall be determined on the record pursuant to section 554 of Title 5 of the 

United States Code. The Farm Credit Administration determination shall be 

made by final order which may be reviewed only as provided in subsection (d) of 

this section. If no hearing is requested as herein provided, the assessment shall 

constitute a final and unappealable order.

(d) Any System institution or person against whom an order imposing a 

civil money penalty has been entered after a Farm Credit Administration hearing 

under this section may obtain review by the United States court of appeals for the 

circuit in which the home office of the System institution is located, or the United 

States Court of Appeals for the District of Columbia Circuit, by filing a notice of 

appeal in such court within twenty days after the service of such order, and 

simultaneously sending a copy of such notice by registered or certified mail to 

the Farm Credit Administration. The Farm Credit Administration shall promptly 
certify and file in such Court the record upon which the penalty was imposed, as 

provided in section 2112 of Title 28 of the United States Code. Final orders of 

the Farm Credit Administration issued under subsection (c) of this section shall 

be reviewable under chapter 7 of Title 5, United States Code.

(e) If any System institution or person fails to pay an assessment after it 

has become a final and unappealable order, or after the court of appeals has 

entered final judgment in favor of the Farm Credit Administration, the Farm 

Credit Administration shall refer the matter to the Attorney General, who shall 

recover the amount assessed by action in the appropriate United States district 

court. In such action, the validity and appropriateness of the final order imposing 

the penalty shall not be subject to review.

(f) The Farm Credit Administration shall promulgate regulations 

establishing procedures necessary to implement section 5.31 and this section.

(g) All penalties collected under authority of this section shall be 

covered into the Treasury of the United States.

(h) For purposes of this section, any directive issued under section 

4.3(b)(2), 4.3A(e), or 4.14A(i) shall be treated as an order that has become final 

and was issued under section 5.25.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2269

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2269 SEC. 5.33. FURTHER PENALTIES.

Any director or officer, or former director or officer of a System institution, 

or any other person, against whom there is outstanding and effective any notice 

or order (which is an order which has become final) served upon such director, 

officer, or other person under section 5.28 or 5.29 of this Act, and who (1) 

participates in any manner in the conduct of the affairs of the institution involved, 

or directly or indirectly solicits or procures, or transfers or attempts to transfer, or 

votes or attempts to vote, any proxies, consents, or authorizations in respect of 

any voting rights in such institution, or (2) without the prior written approval of 

the Farm Credit Administration, votes for a director, serves or acts as a director, 

officer, or employee of any System institution, shall upon conviction be fined not 

more than $5,000 or imprisoned for not more than one year, or both.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2270

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2270 SEC. 5.34. REPLACEMENT OF SUSPENDED OR REMOVED

DIRECTORS.

If at any time, because of the suspension or removal of one or more 

directors pursuant to section 5.28 or 5.29 of this Act, there shall be on the board 

of directors of a System institution less than a quorum of directors not so 

suspended, the Chairman shall appoint persons to serve temporarily as directors 

in their place and stead so as to establish a quorum until such time as those who 

have been removed are reinstated or their respective successors are duly elected 

and take office.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2271

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2271 SEC. 5.35. DEFINITIONS.

As used in this part—

(1) the terms "cease and desist order which has become final" and 

"order which has become final" mean a cease and desist order, or an order, 

issued by the Farm Credit Administration with the consent of the System 

institution or the director or officer or other person concerned, or with 

respect to which no petition for review of the action of the Farm Credit 

Administration has been filed and perfected in a court of appeals as 

specified in section 5.30(b) of this Act, or with respect to which the action 

of the court in which such petition is so filed is not subject to further 

review by the Supreme Court of the United States in proceedings provided 

for in section 5.30(b) of this Act, or an order issued under section 5.29 of 

this Act;

(2) the term "violation" includes without limitation any action 

(alone or with another or others) for or toward causing, bringing about, 

participating in, counseling, or aiding or abetting a violation;

(3) the terms "institution in the System," "System institution," and 

"institution" mean all institutions enumerated in section 1.2 of this Act, any 

service organization chartered under part E of title IV of this Act, and the 

Financial Assistance Corporation; and 

(4) the term "unsafe or unsound practice" shall—

(A) have the meaning given to it by the Farm Credit 

Administration by regulation, rule, or order; 

(B) during the period beginning on the date of the enactment 

of this paragraph and ending December 31, 1992, mean any 

noncompliance by a System institution, as determined by the Farm 

Credit Administration in consultation with the Assistance Board, 

with any term or condition imposed on the institution by the 

Assistance Board under section 6.6; and

(C) after December 31, 1992, mean any significant 

noncompliance by a System institution (as determined by the Farm 

Credit Administration, in consultation with the Farm Credit System 

Insurance Corporation) with any term or condition imposed on the 

institution by the Farm Credit System Assistance Board under 

section 6.6 or by the Farm Credit System Insurance Corporation 

under section 5.61.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2272

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2272 SEC. 5.36. NOTICE OF SERVICE.

Any service required or authorized to be made by the Farm Credit 

Administration under this section may be made by registered mail, or in such 

other manner reasonably calculated to give actual notice as the Farm Credit 

Administration may by regulation or otherwise provide. Any such service by 

mail is complete upon mailing. Copies of any notice or order served by the Farm 

Credit Administration on any association or any director or officer thereof or 

other person participating in the conduct of its affairs, under the provisions of this 

part, shall also be sent to the supervisory bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2273

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2273 SEC. 5.37. ANCILLARY PROVISIONS; SUBPOENA POWER, ETC.

In the course of or in connection with any proceeding under this part of any 

examination or investigation under this Act, the Farm Credit Administration or 

any designated representative thereof, including any person designated to 

conduct any hearing under this part, shall have the power to administer oaths and 

affirmations, to take or cause to be taken depositions, and to issue, revoke, quash, 

or modify subpoenas and subpoenas duces tecum; and the Farm Credit 

Administration is empowered to make rules and regulations with respect to any 

such proceedings, examinations, or investigations. The attendance of witnesses 

and the production of documents provided for in this section may be required 

from any place in any State or in any territory or other place subject to the 

jurisdiction of the United States at any designated place where such proceeding is 

being conducted. The Farm Credit Administration or any party to proceeding 

under this part may apply to the United States District Court for the District of 

Columbia, or the United States district court for the judicial district or the United 

States court in any territory in which such proceeding is being conducted, or 

where the witness resides or carries on business, for enforcement of any 

subpoena or subpena duces tecum issued pursuant to this part, and such courts 

shall have jurisdiction and power to order and require compliance therewith. 

Witnesses subpenaed under this section shall be paid the same fees and mileage 

that are paid witnesses in the district courts of the United States. Any court 

having jurisdiction of any proceeding instituted under this part by a System 

institution or a director or officer thereof, may allow to any such party such 

reasonable expenses and attorneys' fees as it deems just and proper; and such 

expenses and fees shall be paid by the System institution or from its assets. Any 

person who willfully shall fail or refuse to attend or testify or to answer any 

lawful inquiry or to produce books, papers, correspondence, memoranda, 

contracts, agreements, or other records, if in such person's power so to do, in 

obedience to the subpena of the Farm Credit Administration, shall be guilty of a 

misdemeanor and, upon conviction, shall be subject to a fine of not more than 

$1,000 or to imprisonment for a term of not more than one year or both.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part C Enforcement Powers of Farm Credit Administration

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2274

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2274 SEC. 5.38. POWER TO REMOVE DIRECTORS AND OFFICERS.

Notwithstanding any other provision of this Act, a farm credit district 

board, bank board, or bank officer or employee shall not remove any director or 

officer of any production credit association or Federal land bank association.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part D Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part D—Miscellaneous

12 U.S.C. 2001 SEC. 5.40. REPEAL.

note (a) The Federal Farm Loan Act, as amended; section 2 of the Act of 

March 10, 1924 (Public Numbered 35, Sixty-eighth Congress, 43 Stat. 17), as 

amended; section 6 of the Act of January 23, 1932 (Public Numbered 3, Seventysecond Congress, 47 Stat. 14), as amended; the Farm Credit Act of 1933, as 

amended; sections 29 and 40 of the Emergency Farm Mortgage Act of 1933; Act 

of June 18, 1934 (Public Numbered 381, Seventy-third Congress, 48 Stat. 983); 

Act of June 4, 1936 (Public Numbered 644, Seventy-fourth Congress, 49 Stat. 

1461), as amended; sections 5, 6, 20, 25(b) and 39 of the Farm Credit Act of 

1937, as amended; sections 601 and 602 of the Act of September 21, 1944 

(Public Law 425, Seventy-eighth Congress, 58 Stat. 740, 741), as amended; 

sections 1, 2, 3, 4, 5, 6, 7, 8, 16, and 17(b) of the Farm Credit Act of 1953, as 

amended; sections 2, 101, and 201(b) of the Farm Credit Act of 1956 are hereby 

repealed. All references in other legislation, State or Federal, rules and 

regulations of any agency, stock, contracts, deeds, security instruments, bonds, 

debentures, notes, mortgages and other documents of the institutions of the 

System, to the Acts repealed hereby shall be deemed to refer to comparable 

provisions of this Act.

(b) All regulations of the Farm Credit Administration or the institutions 

of the System and all charters, bylaws, resolutions, stock classifications, and 

policy directives issued or approved by the Farm Credit Administration, and all 

elections held and appointments made under the Acts repealed by subsection (a) 

of this section shall be continuing and remain valid until superseded, modified, or 

replaced under the authority of this Act. All stock, notes, bonds, debentures, and 

other obligations issued under the repealed acts shall be valid and enforceable 

upon the terms and conditions under which they were issued, including the 

pledge of collateral against which they were issued, and all loans made and 

security or collateral therefore held by, and all contracts entered into by, 

institutions of the System shall remain enforceable according to their terms 

unless and until modified in accordance with the provisions of this Act; it being 

the purpose of this subsection to void disruption in the effective operation of the 

System by reason of said repeals.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part D Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2001 SEC. 5.41. AMENDMENTS TO OTHER LAWS.

note

* * * * *

(b) The third paragraph of section 15 of the Federal Reserve Act (12 

U.S.C. 393) is amended to read as follows:

"The Federal Reserve banks are authorized to act as depositaries for and 

fiscal agents of any Federal land bank, Federal intermediate credit bank, bank for 

cooperatives, or other institutions of the Farm Credit System."
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part D Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note 

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2001 SEC. 5.42. SEPARABILITY.

note If any provision of this Act, or the application thereof to any persons or in

any circumstances, is held invalid, the remainder of this Act and the application 

of such provision to other persons or in other circumstances shall not be affected 

thereby.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part D Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2001 SEC. 5.43. RESERVE RIGHT TO AMEND OR REPEAL.

note The right to alter, amend, or repeal any provision or all of this Act is 

expressly reserved.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part D Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2275

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2275 SEC. 5.44. GENERAL ACCOUNTING OFFICE AUDIT; REPORT 

TO CONGRESS.

(a) The Comptroller General shall conduct an evaluation of the 

programs and activities authorized under the 1980 amendments to this Act, and 

shall make an interim report to the Congress no later than December 31, 1982, 

and a final report to the Congress no later than December 31, 1984. The 

Comptroller General shall include in such evaluation the effect that this Act, as 

amended, will have on agricultural credit services provided by the Farm Credit 

System, Federal agencies, and other entities. The Comptroller General may 

make such interim reports to the Congress on the programs and activities under 

these amendments as the Comptroller General deems necessary or as requested 

by Members of Congress.

(b) For the purpose of conducting program evaluations required in 

subsection (a) of this section, the Comptroller General or his duly authorized 

representatives shall have access to and the right to examine all books, 

documents, papers, records, or other recorded information within the possession 

or control of the Federal land banks and Federal land bank associations, Federal 

intermediate credit banks and production credit associations and banks for 

cooperatives.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part D Miscellaneous

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2275a

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2275a SEC. 5.45. TRANSITION RULES RELATING TO AMENDMENT 

OF CERTAIN FCA APPROVAL AUTHORITIES.

(a) IN GENERAL. Any approvals granted by the Farm Credit 

Administration before the date of the enactment of this section shall remain in 

effect on and after such date.

(b) AUTHORITY TO ISSUE REGULATIONS.

(1) IN GENERAL. Any approval authority of the Farm Credit 

Administration that, under the amendments made by section 802 of the 

Agricultural Credit Act of 1987, became an authority to issue regulations 

may be exercised only until the earlier of the date the Farm Credit 

Administration issues final regulations under such authority, or 1 year after 

the date of the enactment of this section.

(2) ENFORCEMENT ACTIONS. At the close of the 1-year 

period referred to in paragraph (1), the Farm Credit Administration shall 

not take any enforcement action against any System institution with respect 

to any provision so amended, until the Farm Credit Administration issues 

final regulations under such provision.

(c) EFFECT OF SECTION. This section shall not affect the authority 

of the Farm Credit Administration to exercise any other approval authority either 

on a case-by-case basis or through regulation, as provided in section 5.17(a)(5).

NOTE: This section was enacted on January 6, 1988.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a

Date Created: 12/17/2012

Date Modified: 2/15/2018

Part E—Farm Credit System Insurance Corporation

12 U.S.C. 2277a SEC. 5.51. DEFINITIONS.

As used in this part:

(1) BOARD OF DIRECTORS. The term "Board of Directors" 

means the Board of Directors of the Corporation.

(2) CORPORATION. The term "Corporation" means the Farm 

Credit System Insurance Corporation established in section 5.52.

(3) INSURED OBLIGATION. The term "insured obligation" 

means any note, bond, debenture, or other obligation issued under 

subsection (c) or (d) of section 4.2—

(A) on or before January 5, 1989, on behalf of any System 

bank; and

(B) after such date, which, when issued, is issued on behalf 

of any insured System bank.

(4) INSURED SYSTEM BANK. The term "insured System 

bank" means any System bank whose participation in notes, bonds, 

debentures, and other obligations issued under subsection (c) or (d) of 

section 4.2 is insured under this part.

(5) STATE. The term "State" means any of the 50 States, the 

District of Columbia, any Territory of the United States, Puerto Rico, 

Guam, American Samoa, the Trust Territory of the Pacific Islands, or the 

Virgin Islands.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-1

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-1 SEC. 5.52. ESTABLISHMENT OF FARM CREDIT SYSTEM 

INSURANCE CORPORATION. 

There is hereby established the Farm Credit System Insurance Corporation 

which shall insure, in accordance with this part, the timely payment of principal 

and interest on notes, bonds, debentures, and other obligations issued under 

subsection (c) or (d) of section 4.2 on behalf of one or more System banks all of 

which are entitled to the benefits of insurance under this part.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-2

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-2 SEC. 5.53. BOARD OF DIRECTORS. 

(a) ESTABLISHMENT. The Corporation shall be managed by a Board 

of Directors that shall consist of the members of the Farm Credit Administration 

Board.

(b) CHAIRMAN. The Board of Directors shall be chaired by any Board 

member other than the Chairman of the Farm Credit Administration Board.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-3

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-3 SEC. 5.54. COMMENCEMENT OF INSURANCE.

Effective beginning on January 1, 1989, or 12 months after the date of the 

enactment of this part, whichever is later, each System bank shall be an insured 

System bank and shall be subject to this part. Each System bank that is 

authorized to commence or resume operations under a title of this Act shall be an 

insured System bank from the time of such authorization. A bank resulting from 

the merger or consolidation of insured System banks shall be an insured System 

bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-4

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-4 SEC. 5.55. PREMIUMS. 

(a) AMOUNT IN FUND NOT EXCEEDING SECURE BASE 

AMOUNT.

(1) IN GENERAL. If at the end of any calendar year the 

aggregate of amounts in the Farm Credit Insurance Fund does not exceed 

the secure base amount, subject to paragraph (3), the premium due from 

any insured System bank for the calendar year shall be equal to the sum 

of—

(A) the average outstanding insured obligations issued by the 

bank for the calendar year, after deducting from the obligations the 

percentages of the guaranteed portions of loans and investments 

described in paragraph (2), multiplied by 0.0020; and

(B) the product obtained by multiplying--

(i) the sum of--

(I) the average principal outstanding for the 

calendar year on loans made by the bank that are in nonaccrual status; 

and

(II) the average amount outstanding for the 

calendar year of other-than-temporarily impaired investments made 

by the bank; by

(ii) 0.0010.

(2) DEDUCTIONS FROM AVERAGE OUTSTANDING 

INSURED OBLIGATIONS.--The average outstanding insured obligations 

issued by the bank for the calendar year referred to in paragraph (1)(A) 

shall be reduced by deducting from the obligations the sum of (as 

determined by the Corporation)--

(A) 90 percent of each of--

(i) the average principal outstanding for the calendar 

year on the guaranteed portions of Federal governmentguaranteed loans made by the bank that are in accrual status; 

and

(ii) the average amount outstanding for the calendar 

year of the guaranteed portions of Federal governmentguaranteed investments made by the bank that are not 

permanently impaired; and

(B) 80 percent of each of--

(i) the average principal outstanding for the calendar 

year on the guaranteed portions of State government-
guaranteed loans made by the bank that are in accrual status; 

and

(ii) the average amount outstanding for the calendar 

year of the guaranteed portions of State governmentguaranteed investments made by the bank that are not 

permanently impaired.

(3) REDUCED PREMIUMS. The Corporation, in the sole 

discretion of the Corporation, may reduce by a percentage uniformly 

applied to all insured System banks the premium due from each insured 

System bank during any calendar year, as determined under paragraph (1).

(4) DEFINITION OF GOVERNMENT-GUARANTEED LOANS 

OR INVESTMENTS. In this section, the term "government-guaranteed", 

when applied to a loan or an investment, means a loan, credit, or 

investment, or portion of a loan, credit, or investment, that is guaranteed—

(A) by the full faith and credit of the United States 

Government or any State government;

(B) by an agency or other entity of the United States 

Government whose obligations are explicitly guaranteed by the 

United States Government; or

(C) by an agency or other entity of a State government 

whose obligations are explicitly guaranteed by such State 

government.

(b) AMOUNT IN FUND EXCEEDING SECURE BASE AMOUNT. 

At any time the aggregate of amounts in the Farm Credit Insurance Fund exceeds 

the secure base amount, the Corporation shall reduce the premium due from each 

insured System bank, as determined under subsection (a)(1) of this section, by a 

percentage determined by the Corporation so that the aggregate of the premiums 

payable by all System banks is sufficient to ensure that the aggregate of amounts 

in the Farm Credit Insurance Fund after such premiums are paid is not less than 

the secure base amount at such time.

(c) SECURE BASE AMOUNT. 

(1) IN GENERAL.--For purposes of this part, the term "secure 

base amount" means, with respect to any point in time, 2 percent of the 

aggregate outstanding insured obligations of all insured System banks at 

such time (as adjusted under paragraph (2)), or such other percentage of the 

aggregate amount as the Corporation in its sole discretion determines is 

actuarially sound to maintain in the Insurance Fund taking into account the 

risk of insuring outstanding insured obligations.

(2) ADJUSTMENT.--The aggregate outstanding insured 

obligations of all insured System banks under paragraph (1) shall be 

adjusted downward to exclude an amount equal to the sum of (as 

determined by the corporation)--

(A) 90 percent of each of--

(i) the guaranteed portions of principal 

outstanding on Federal government-guaranteed loans in 

accrual status made by the banks; and

(ii) the guaranteed portions of the amount of Federal 

government-guaranteed investments made by the banks that 

are not permanently impaired; and

(B) 80 percent of each of--
(i) the guaranteed portions of principal outstanding on 

State government-guaranteed loans in accrual status made by 

the banks; and

(ii) the guaranteed portions of the amount of State 

government-guaranteed investments made by the banks that 

are not permanently impaired.

(d) DETERMINATION OF LOAN AND INVESTMENT AMOUNTS. 

For the purpose of subsections (a) and (c), the principal outstanding on all loans 

made by an insured System bank, and the amount outstanding on all investments 

made by an insured System bank, shall be determined based on—

(1) all loans or investments made by any production credit 

association, or any other association making direct loans under authority 

provided under section 7.6, that is able to make such loans or investments 

because such association is receiving, or has received, funds provided 

through the insured System bank;

(2) all loans or investments made by any bank, company, 

institution, corporation, union, or association described in section 

1.7(b)(1)(B), that is able to make such loans or investments because such 

entity is receiving, or has received, funds provided through the insured 

System bank; and

(3) all loans or investments made by such insured System bank 

(other than loans made to any party described in paragraph (1) or (2)).

(e) ALLOCATION TO SYSTEM INSTITUTIONS OF EXCESS 

RESERVES.

(1) ESTABLISHMENT OF ALLOCATED INSURANCE 

RESERVES ACCOUNTS. There is hereby established in the Farm Credit 

Insurance Fund an Allocated Insurance Reserves Account—

(A) for each insured System bank; and

(B) subject to paragraph (6)(C), for all holders, in the 

aggregate, of Financial Assistance Corporation stock.

(2) TREATMENT. Amounts in any Allocated Insurance Reserves 

Account shall be considered to be part of the Farm Credit Insurance Fund.

(3) ANNUAL ALLOCATIONS. If, at the end of any calendar 

year, the aggregate of the amounts in the Farm Credit Insurance Fund 

exceeds the secure base amount, the Corporation shall allocate to the 

Allocated Insurance Reserves Accounts the excess amount less the amount 

that the Corporation, in its sole discretion, determines to be the sum of the 

estimated operating expenses and estimated insurance obligations of the 

Corporation for the immediately succeeding calendar year.

(4) ALLOCATION FORMULA. From the total amount required 

to be allocated at the end of a calendar year under paragraph (3)—

(A) 10 percent of the total amount shall be credited to the 

Allocated Insurance Reserves Account established under paragraph 

(1)(B), subject to paragraph (6)(C); and

(B) there shall be credited to the allocated insurance reserves 

account of each insured system bank an amount that bears the same 

ratio to the total amount (less any amount credited under 

subparagraph (A)) as--

(i) the average principal outstanding for the calendar 

year on insured obligations issued by the bank (after deducting 

from the principal the percentages of the guaranteed portions 
of loans and investments described in subsection (a)(2)); bears 

to

(ii) the average principal outstanding for the calendar 

year on insured obligations issued by all insured System banks 

(after deducting from the principal the percentages of the 

guaranteed portions of loans and investments described in 

subsection (a)(2)).

(5) USE OF FUNDS IN ALLOCATED INSURANCE 

RESERVES ACCOUNTS. To the extent that the sum of the operating 

expenses of the Corporation and the insurance obligations of the 

Corporation for a calendar year exceeds the sum of operating expenses and 

insurance obligations determined under paragraph (3) for the calendar year, 

the Corporation shall cover the expenses and obligations by—

(A) reducing each Allocated Insurance Reserves Account by 

the same proportion; and

(B) expending the amounts obtained under subparagraph (A) 

before expending other amounts in the Fund.

(6) OTHER DISPOSITION OF ACCOUNT FUNDS.

(A) IN GENERAL. As soon as practicable during each 

calendar year, the Corporation may—

(i) subject to subparagraph (D), pay to each insured 

System bank, in a manner determined by the Corporation, an 

amount equal to the balance in the Allocated Insurance 

Reserves Account of the System bank; and

(ii) subject to subparagraphs (C) and (E), pay to each 

System bank and association holding Financial Assistance 

Corporation stock a proportionate share, determined by 

dividing the number of shares of Financial Assistance 

Corporation stock held by the institution by the total number of 

shares of Financial Assistance Corporation stock outstanding 

at the time of the termination of the Financial Assistance 

Corporation, of the balance in the Allocated Insurance 

Reserves Account established under paragraph (1)(B).

(B) AUTHORITY TO ELIMINATE OR REDUCE 

PAYMENTS. The Corporation may eliminate or reduce payments 

during a calendar year under subparagraph (A) if the Corporation 

determines, in its sole discretion, that the payments, or other 

circumstances that might require use of the Farm Credit Insurance 

Fund, could cause the amount in the Farm Credit Insurance Fund 

during the calendar year to be less than the secure base amount.

(C) REIMBURSEMENT FOR FINANCIAL ASSISTANCE 

CORPORATION STOCK.

(i) SUFFICIENT FUNDING. Notwithstanding 

paragraph (4)(A), on provision by the Corporation for the 

accumulation in the Account established under paragraph 

(1)(B) of funds in an amount equal to $56,000,000, the 

Corporation shall not allocate any further funds to the Account 

except to replenish the Account if funds are diminished below 

$56,000,000 by the Corporation under paragraph (5).
(ii) TERMINATION OF ACCOUNT.--On 

disbursement of an amount equal to $56,000,000, the 

Corporation shall--

(I) close the account established under 

paragraph (1)(B); and

(II) transfer any remaining funds in the Account 

to the remaining Allocated Insurance Reserves Accounts 

in accordance with paragraph (4)(B) for the calendar 

year in which the transfer occurs.

(D) DISTRIBUTION OF PAYMENTS RECEIVED. Not 

later than 60 days after receipt of a payment made under 

subparagraph (A)(i), each insured System bank, in consultation with 

affiliated associations of the insured System bank, and taking into 

account the direct or indirect payment of insurance premiums by the 

associations, shall develop and implement an equitable plan to 

distribute payments received under subparagraph (A)(i) among the 

bank and associations of the bank.

(E) EXCEPTION FOR PREVIOUSLY REIMBURSED 

ASSOCIATIONS. For purposes of subparagraph (A)(ii), in any 

Farm Credit district in which the funding bank has reimbursed 1 or 

more affiliated associations of the bank for the previously 

unreimbursed portion of the Financial Assistance Corporation stock 

held by the associations, the funding bank shall be deemed to be the 

holder of the shares of Financial Assistance Corporation stock for 

which the funding bank has provided the reimbursement.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-5

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-5 SEC. 5.56. CERTIFICATION OF PREMIUMS.

(a) FILING CERTIFIED STATEMENT. On a date to be determined in 

the sole discretion of the Board of Directors of the Corporation, each insured 

System bank that became insured before the beginning of the period for which 

premiums are being assessed (referred to in this section as the "period") shall file 

with the Corporation a certified statement showing—

(1) the average outstanding insured obligations for the period 

issued by the bank;

(2)(A) the average principal outstanding for the period on the 

guaranteed portion of Federal government-guaranteed loans that are in 

accrual status; and

(B) the average amount outstanding for the period of Federal 

government-guaranteed investments that are not permanently impaired (as 

defined in section 5.55(a)(4));

(3)(A) the average principal outstanding for the period on State 

government-guaranteed loans that are in accrual status; and

(B) the average amount outstanding for the period of State 

government-guaranteed investments that are not permanently impaired (as 

defined in section 5.55(a)(4));

(4)(A) the average principal outstanding for the period on loans that 

are in nonaccrual status; and

(B) the average amount outstanding for the period of other-thantemporarily impaired investments; and

(5) the amount of the premium due the Corporation from the bank 

for the period. 

(b) CONTENTS AND FORM OF STATEMENT. The certified 

statement required to be filed with the Corporation under subsection (a) of this 

section shall be in such form and set forth such supporting information as the 

Board of Directors shall prescribe, and shall be certified by the president of the 

bank or any other officer designated by its board of directors that to the best of 

the persons knowledge and belief the statement is true, correct, complete, and has 

been prepared in accordance with this part and all regulations issued thereunder.

(c) PREMIUM PAYMENTS.--

(1) IN GENERAL.--Except as provided in paragraph (2), each 

insured System bank shall pay to the Corporation the premium payments 

required under subsection (a), not more frequently than once in each 

calendar quarter, in such manner and at such 1 or more times as the Board 

of Directors shall prescribe.
(2) PREMIUM AMOUNT.--The amount of the premium shall be 

established not later than 60 days after filing the certified statement 

specifying the amount of the premium.

(d) REGULATIONS. The Board of Directors shall prescribe all rules 

and regulations necessary for the enforcement of this section. The Board of 

Directors may limit the retroactive effect, if any, of any of its rules or regulations.

NOTE: The amendments made by section 5403 of Public Law 107-171 shall 

apply with respect to determinations of premiums for calendar year 2002 

and for any succeeding calendar year, and to certified statements with 

respect to such premiums.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-6

Date Created: 3/20/2014

Date Modified: 2/15/2018

12 U.S.C. 2277a-6 SEC. 5.57. OVERPAYMENT AND UNDERPAYMENT OF 

PREMIUMS; REMEDIES.

(a) OVERPAYMENTS. The Corporation may refund to any insured 

System bank any premium payment made by the bank exceeding the amount due 

the Corporation.

(b) UNDERPAYMENTS.

(1) RECOVERY. The Corporation, in a suit brought at law or in 

equity in any court of competent jurisdiction, may recover from any 

insured System bank the amount of any unpaid premium lawfully payable 

by the bank to the Corporation, whether or not the bank has filed any 

certified statement under section 5.56, and whether or not suit has been 

brought to compel the bank to file any such statement.

(2) LIMITATION. Any action or proceeding for the recovery of 

any premium due the Corporation under paragraph (1), or for the recovery 

of any amount paid to the Corporation exceeding the amount due the 

Corporation, shall be brought within 5 years after the right accrued for 

which the claim is made. If an insured System bank has filed with the 

Corporation a false or fraudulent certified statement with the intent to 

evade, in whole or in part, the payment of a premium, the claim shall not 

be deemed to have accrued until the Corporation discovers that the 

certified statement is false or fraudulent.

(c) FAILURE TO FILE STATEMENT OR PAY PREMIUM.

(1) FORFEITURE OF RIGHTS. If any insured System bank fails 

to file any certified statement required to be filed by such bank under 

section 5.56 or fails to pay any premium required to be paid by such bank 

under any provision of this part, and if the bank does not correct such 

failure within 30 days after the Corporation gives written notice to an 

officer of the bank, citing this subsection and stating that the bank has 

failed to so file or pay as required by law, all the rights, privileges, and 

franchises of the bank granted to it under this Act shall be thereby forfeited.

(2) ENFORCEMENT. The Corporation may bring an action to 

enforce this subsection against any such bank in any court of competent 

jurisdiction for the judicial district in which the bank is located.

(3) LIABILITY OF DIRECTORS. Every director who 

participated in or assented to a failure (described in paragraph (1)) shall be 

held personally liable for all consequential damages.

(d) EFFECT ON OTHER REMEDIES. The remedies provided in 

subsections (b) and (c) of this section shall not be construed as limiting any other 

remedies against any insured System bank, but shall be in addition thereto.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-7

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-7 SEC. 5.58. GENERAL CORPORATE POWERS. 

On the date of the enactment of this part, the Corporation shall become a 

body corporate and as such shall have the following powers:

(1) SEAL. The Corporation may adopt and use a corporate seal.

(2) SUCCESSION. The Corporation may have succession until 

dissolved by an Act of Congress. The Corporation shall succeed to the 

rights of the Farm Credit System Assistance Board under agreements 

between the Farm Credit System Assistance Board and System institutions 

certifying the institutions as eligible to issue preferred stock pursuant to 

title VI on the termination of the Assistance Board on the date provided in 

section 6.12.

(3) CONTRACTS. The Corporation may make contracts.

(4) LEGAL ACTIONS.

(A) IN GENERAL. The Corporation may sue and be sued, 

complain and defend, in any court of law or equity, State or Federal.

(B) JURISDICTION. All suits of a civil nature at common 

law or in equity to which the Corporation shall be a party shall be 

deemed to arise under the laws of the United States, and the United 

States district courts shall have original jurisdiction thereof, without 

regard to the amount in controversy, and the Corporation, in any 

capacity, without bond or security, may remove any such action, suit, 

or proceeding from a State court to the United States district court 

for the district or division embracing the place where the same is 

pending by following any procedure for removal then in effect.

(C) ATTACHMENT AND EXECUTION. No attachment 

or execution may be issued against the Corporation or its property 

before final judgment in any suit, action, or proceeding in any State, 

county, municipal, or United States court.

(D) AGENT FOR SERVICE OF PROCESS. The Board of 

Directors shall designate an agent on whom service of process may 

be made in any State or jurisdiction in which any insured System 

bank is located.

(5) OFFICERS AND EMPLOYEES.

(A) IN GENERAL. The Corporation may appoint by its 

Board of Directors such officers and employees as are not otherwise 

provided for in this part, define their duties, fix their compensation, 

and require bonds of them and fix the penalty thereof, and dismiss at

pleasure such officers or employees.
(B) EMPLOYEES OF THE UNITED STATES. Nothing in 

this or any other Act shall be construed to prevent the appointment 

and compensation, as an officer or employee of the Corporation, of 

any officer or employee of the United States in any board, 

commission, independent establishment, or executive department 

thereof.

(6) BYLAWS. The Corporation may prescribe, by its Board of 

Directors, bylaws not inconsistent with law, regulating the manner in 

which its general business may be conducted, and the privileges granted to 

it by law may be exercised and enjoyed.

(7) INCIDENTAL POWERS. The Corporation may exercise by 

its Board of Directors, or duly authorized officers or agents, all powers 

specifically granted by the provisions of this part, and such incidental 

powers as shall be necessary to carry out the powers so granted.

(8) INFORMATION. The Corporation may, when necessary, 

make examinations of, and require information and reports from, System 

institutions, as provided in this part.

(9) CONSERVATOR OR RECEIVER. The Corporation may act 

as a conservator or receiver.

(10) RULES AND REGULATIONS. The Corporation may 

prescribe by its Board of Directors such rules and regulations as it 

considers necessary to carry out this part and section 1.12(b) (except to 

the extent that authority to issue such rules and regulations has been 

expressly and exclusively granted to any other regulatory agency).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-8

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-8 SEC. 5.59. CONDUCT OF CORPORATE AFFAIRS; 

EXAMINATION OF SYSTEM INSTITUTIONS. 

(a) CONDUCT OF CORPORATE AFFAIRS.

(1) FAIR ADMINISTRATION. The Board of Directors shall 

administer the affairs of the Corporation fairly and impartially and without 

discrimination.

(2) OBLIGATIONS AND EXPENSES. The Board of Directors 

shall determine and prescribe the manner in which the obligations of the 

Corporation may be incurred and the expenses of the Corporation may be 

allowed and paid.

(3) USE OF MAILS. The Corporation may use the United States 

mails in the same manner and under the same conditions as the executive 

departments of the Federal Government.

(4) USE OF INFORMATION. The Corporation, with the consent 

of any board, commission, independent establishment, or executive 

department of the Federal Government, including any field service thereof, 

may avail itself of the use of information, services, and facilities thereof in 

carrying out this part.

(5) USE OF FARM CREDIT ADMINISTRATION PERSONNEL. 

To the extent practicable, the Corporation shall use the personnel and 

resources of the Farm Credit Administration to minimize duplication of 

effort and to reduce costs.

(b) EXAMINATION OF SYSTEM INSTITUTIONS.

(1) EXAMINATION AUTHORITY.

(A) IN GENERAL. If the Board of Directors considers it 

necessary to examine an insured System bank, a production credit 

association, an association making direct loans under the authority 

provided under section 7.6, or any System institution in receivership, 

the Board may, using Farm Credit Administration examiners, 

conduct the examination using reports and other information on the 

System institution prepared or held by the Farm Credit 

Administration. Notwithstanding any other provision of this Act, on 

cancellation of the charter of a System institution, the Corporation 

shall have authority to examine the System institution in receivership. 

An examination shall be performed at such intervals as the 

Corporation shall determine.

(B) REQUEST FOR ADDITIONAL EXAMINATION OR 

OTHER INFORMATION. If the Board determines that such reports 

or information are not adequate to enable the Corporation to carry 
out the duties of the Corporation under this subsection, the Board 

shall request the Farm Credit Administration to examine or to obtain 

other information from or about the System institution and provide to 

the Corporation the resulting examination report or such other 

information.

(2) APPOINTMENT OF EXAMINERS. If the Farm Credit 

Administration informs the Corporation that the Farm Credit 

Administration is unable to comply with a request made under paragraph 

(1)(B) with respect to a System institution, the Board may appoint 

examiners to examine the institution.

(3) POWERS AND REPORT. Each examiner appointed under 

paragraph (2) shall make such examination of the affairs of the System 

institution as the Board may direct, and shall make a full and detailed 

report of the examination to the Corporation.

(4) APPOINTMENT OF CLAIM AGENTS. The Board of 

Directors of the Corporation shall appoint claim agents who may 

investigate and examine all claims for insured obligations.

(c) OATH, AFFIRMATIONS, AND TESTIMONY. In connection with 

examinations under this section, the Corporation or its designated representatives 

may administer oaths and affirmations, and may examine, take, and preserve 

testimony under oath, as to any matter with respect to the affairs of any such 

institution.

(d) COOPERATION WITH FCA EXAMINERS. The examiners 

appointed by the Board of Directors shall cooperate to the maximum extent 

possible with examiners of the Farm Credit Administration to minimize 

duplication of effort and minimize costs.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-9

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-9 SEC. 5.60. INSURANCE FUND. 

(a) ESTABLISHMENT. There is hereby established a Farm Credit 

Insurance Fund (hereinafter referred to in this section as the "Insurance Fund") 

for insuring the timely payment of principal and interest on insured obligations. 

The assets in the Fund shall be held by the Corporation for the uses and purposes 

of the Corporation.

(b) AMOUNTS IN FUND.

(1) REVOLVING FUND. All amounts in the revolving fund 

established by section 4.0 shall be transferred into the Farm Credit 

Insurance Fund on January 1, 1989, or 12 months after the date of the 

enactment of this part, whichever is later, except that the obligations to, 

and rights of, any person in such revolving fund arising out of any event or 

transaction before the date of the enactment of this part shall remain 

unimpaired.

(2) DEPOSIT OF PREMIUMS. The Corporation shall deposit in 

the Insurance Fund all premium payments received by the Corporation 

under this part.

(c) USES OF FUND.

(1) MANDATORY USE. Beginning January 1, 1993, the 

Corporation shall expend amounts in the Insurance Fund to the extent 

necessary to insure the timely payment of interest and principal on insured 

obligations.

(2) OTHER MANDATORY USES. Beginning January 1, 1993, 

the Corporation shall use amounts in the Insurance Fund to—

(A) satisfy System institution defaults through the purchase 

of preferred stock or other payments as provided for in section 

6.26(d)(3); and

(B) ensure the retirement of eligible borrower stock at par 

value under section 4.9A.

(3) PERMISSIVE USES. The Corporation may expend amounts 

in the Insurance Fund to carry out section 5.61 and to cover the operating 

costs of the Corporation.

(4) CORPORATE PAYMENT OR REFUNDS. The Corporation 

shall make all payments and refunds required to be made by the 

Corporation under this part from amounts in the Insurance Fund.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-10

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-10 SEC. 5.61. POWERS OF CORPORATION WITH RESPECT TO 

TROUBLED INSURED SYSTEM BANKS.

(a) AUTHORITY TO PROVIDE ASSISTANCE.

(1) STAND-ALONE ASSISTANCE. The Corporation, in its sole 

discretion and on such terms and conditions as the Board of Directors may 

prescribe, may make loans to, purchase the assets or securities of, assume 

the liabilities of, or make contributions to, any insured System bank if such 

action is taken—

(A) to prevent the placing of the bank in receivership;

(B) to restore the bank to normal operation; or

(C) to reduce the risk to the Corporation posed by the bank 

when severe financial conditions threaten the stability of a significant 

number of insured System banks or of insured System banks 

possessing significant financial resources.

(2) FACILITATION OF MERGERS OR CONSOLIDATION.

(A) IN GENERAL. To facilitate a merger or consolidation 

of a qualifying insured System bank, the sale of assets of such 

insured System bank to another insured System bank, the assumption 

of such insured System bank's liabilities by such other insured 

System bank, or the acquisition of the stock of such insured System 

bank by such other insured System bank, the Corporation, in its sole 

discretion and on such terms and conditions as the Board of 

Directors may prescribe, may—

(i) purchase any such assets or assume any such 

liabilities;

(ii) make loans or contributions to, or purchase debt 

securities of, such other insured System bank;

(iii) guarantee such other insured System bank against 

loss by reason of such other insured System bank's merging or 

consolidating with, or assuming the liabilities and purchasing 

the assets of, such insured System bank; or

(iv) take any combination of the actions referred to in 

the preceding clauses.

(B) QUALIFYING INSURED SYSTEM BANK. For 

purposes of subparagraph (A), the term "qualifying insured System 

bank" means any insured System bank that—

(i) is in receivership;

(ii) is, in the judgment of the Board of Directors, in 

danger of being placed in receivership; or
(iii) is, in the sole discretion of the Corporation, an 

insured System bank that, when severe financial conditions 

exist that threaten the stability of a significant number of 

insured System banks or of insured System banks possessing 

significant financial resources, requires assistance under 

subparagraph (A) to lessen the risk to the Corporation posed 

by such insured System bank under such threat of instability.

(3) LIMITATION.

(A) LEAST-COST RESOLUTION. Assistance may not be 

provided to an insured System bank under this subsection unless the 

means of providing the assistance is the least costly means of 

providing the assistance by the Farm Credit Insurance Fund of all 

possible alternatives available to the Corporation, including 

liquidation of the bank (including paying the insured obligations 

issued on behalf of the bank). Before making a least-cost 

determination under this subparagraph, the Corporation shall accord 

such other insured System banks as the Corporation determines to be 

appropriate the opportunity to submit information relating to the 

determination.

(B) DETERMINING LEAST COSTLY APPROACH. In 

determining the least costly alternative under subparagraph (A), the 

Corporation shall—

(i) evaluate alternatives on a present-value basis, 

using a reasonable discount rate;

(ii) document the evaluation and the assumptions on 

which the evaluation is based; and

(iii) retain the documentation for not less than 5 years.

(C) TIME OF DETERMINATION.

(i) GENERAL RULE. For purposes of this 

subsection, the determination of the costs of providing any 

assistance under any provision of this section with respect to 

any insured System bank shall be made as of the date on which 

the Corporation makes the determination to provide the 

assistance to the institution under this section.

(ii) RULE FOR LIQUIDATIONS. For purposes of 

this subsection, the determination of the costs of liquidation of 

any insured System bank shall be made as of the earliest of—

(I) the date on which a conservator is appointed 

for the insured System bank;

(II) the date on which a receiver is appointed for 

the insured System bank; or

(III) the date on which the Corporation makes 

any determination to provide any assistance under this 

section with respect to the insured System bank.

(D) RULE FOR STAND-ALONE ASSISTANCE. Before 

providing any assistance under paragraph (1), the Corporation shall 

evaluate the adequacy of managerial resources of the insured System 

bank. The continued service of any director or senior ranking officer 

who serves in a policymaking role for the assisted insured System 

bank, as determined by the Corporation, shall be subject to approval 

by the Corporation as a condition of assistance.
(E) DISCRETIONARY DETERMINATIONS. Any 

determination that the Corporation makes under this paragraph shall 

be in the sole discretion of the Corporation.

(F) PURCHASE OF STOCK. The Corporation may not use 

its authority under this subsection to purchase any stock of an 

insured System bank. The preceding sentence shall not be construed 

to limit the ability of the Corporation to enter into and enforce 

covenants and agreements that it determines to be necessary to 

protect the financial interests of the Corporation.

(4) SUBORDINATION. Any assistance provided under this 

subsection may be in subordination to the rights of owners of obligations 

and other creditors.

(5) REPORTS. The Corporation, in its annual report to Congress, 

shall report the total amount saved, or its estimates to be saved, by the 

Corporation exercising the authority provided to the Corporation in this 

subsection.

(b) AUTHORITY TO PLEDGE OR SELL ASSETS. The Corporation, 

in its discretion, may make loans on the security of, or may purchase, and 

liquidate or sell, any part of the assets of, any insured System bank that is placed 

in receivership because of the inability of the bank to pay principal or interest on 

any of its notes, bonds, debentures, or other obligations in a timely manner.

(c) SUBROGATION.

(1) IN GENERAL. On the payment to an owner of an insured 

obligation issued on behalf of an insured System bank in receivership, the 

Corporation shall be subrogated to all rights of the owner against the bank 

to the extent of the payment.

(2) RECEIPT OF DIVIDENDS. Subrogation under paragraph (1) 

shall include the right on the part of the Corporation to receive the same 

dividends from the proceeds of the assets of the bank as would have been 

payable to the owner on a claim for the insured obligation. 

(d) RIGHT TO ASSETS. Any agreement that shall diminish or defeat 

the right, title, or interest of the Corporation in any asset acquired by such 

Corporation under this section, either as security for a loan or by purchase, shall 

not be valid against the Corporation unless the agreement—

(1) is in writing;

(2) is executed by the bank and the person or persons claiming an 

adverse interest thereunder, including the obligor, contemporaneously with 

the acquisition of the asset by the bank;

(3) has been approved by the board of directors of the bank or its 

loan committee, which approval shall be reflected in the minutes of the 

board or committee; and

(4) has been, continuously, from the time of its execution, an 

official record of the bank.

(e) INSURED SYSTEM BANK. As used in this section, the terms 

"insured System bank" and "bank" include each production credit association and 

other association making direct loans under the authority provided under section 

7.6.

(f) EFFECTIVE DATE. The Corporation shall not exercise any 

authority under this section prior to January 1, 1993.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-10a 

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-10a SEC. 5.61A. OVERSIGHT ACTIONS BY THE CORPORATION.

(a) DEFINITIONS. In this section, the term "institution" means—

(1) an insured System bank; and

(2) a production credit association or other association making 

loans under section 7.6 with a direct loan payable to the funding bank of 

the association that comprises 20 percent or more of the funding bank's 

total loan volume net of nonaccrual loans.

(b) CONSULTATION REGARDING PARTICIPATION OF 

UNDERCAPITALIZED BANKS IN ISSUANCE OF INSURED 

OBLIGATIONS. The Farm Credit Administration shall consult with the 

Corporation prior to approving an insured obligation that is to be issued by or on 

behalf of, or participated in by, any insured System bank that fails to meet the 

minimum level for any capital requirement established by the Farm Credit 

Administration for the bank.

(c) CONSULTATION REGARDING APPLICATIONS FOR 

MERGERS AND RESTRUCTURINGS.

(1) CORPORATION TO RECEIVE COPY OF TRANSACTION 

APPLICATIONS. On receiving an application for a merger or 

restructuring of an institution, the Farm Credit Administration shall 

forward a copy of the application to the Corporation.

(2) CONSULTATION REQUIRED. If the proposed merger or 

restructuring involves an institution that fails to meet the minimum level 

for any capital requirement established by the Farm Credit Administration 

applicable to the institution, the Farm Credit Administration shall allow 30 

days within which the Corporation may submit the views and 

recommendations of the Corporation, including any conditions for 

approval. In determining whether to approve or disapprove any proposed 

merger or restructuring, the Farm Credit Administration shall give due 

consideration to the views and recommendations of the Corporation.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-10b

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-10b SEC. 5.61B. AUTHORITY TO REGULATE GOLDEN 

PARACHUTE AND INDEMNIFICATION PAYMENTS.

(a) DEFINITIONS. In this section:

(1) GOLDEN PARACHUTE PAYMENT. The term "golden 

parachute payment"—

(A) means a payment (or any agreement to make a payment) 

in the nature of compensation for the benefit of any institutionrelated party under an obligation of any Farm Credit System 

institution that—

(i) is contingent on the termination of the party's 

relationship with the institution; and

(ii) is received on or after the date on which—

(I) the institution is insolvent;

(II) a conservator or receiver is appointed for the 

institution;

(III) the institution has been assigned by the 

Farm Credit Administration a composite CAMEL rating 

of 4 or 5 under the Farm Credit Administration Rating 

System, or an equivalent rating; or

(IV) the Corporation otherwise determines that 

the institution is in a troubled condition (as defined in 

regulations issued by the Corporation); and

(B) includes a payment that would be a golden parachute 

payment but for the fact that the payment was made before the date 

referred to in subparagraph (A)(ii) if the payment was made in 

contemplation of the occurrence of an event described in any 

subclause of subparagraph (A); but 

(C) does not include—

(i) a payment made under a retirement plan that is 

qualified (or is intended to be qualified) under section 401 of 

the Internal Revenue Code of 1986 or other nondiscriminatory 

benefit plan;

(ii) a payment made under a bona fide supplemental 

executive retirement plan, deferred compensation plan, or 

other arrangement that the Corporation determines, by 

regulation or order, to be permissible; or

(iii) a payment made by reason of the death or 

disability of an institution-related party.
(2) INDEMNIFICATION PAYMENT. The term 

"indemnification payment" means a payment (or any agreement to make a 

payment) by any Farm Credit System institution for the benefit of any 

person who is or was an institution-related party, to pay or reimburse the 

person for any liability or legal expense with regard to any administrative 

proceeding or civil action instituted by the Farm Credit Administration that 

results in a final order under which the person—

(A) is assessed a civil money penalty; or

(B) is removed or prohibited from participating in the 

conduct of the affairs of the institution.

(3) INSTITUTION-RELATED PARTY. The term "institutionrelated party" means—

(A) a director, officer, employee, or agent for a Farm Credit 

System institution or any conservator or receiver of such an 

institution;

(B) a stockholder (other than another Farm Credit System 

institution), consultant, joint venture partner, or any other person 

determined by the Farm Credit Administration to be a participant in 

the conduct of the affairs of a Farm Credit System institution; and

(C) an independent contractor (including any attorney, 

appraiser, or accountant) that knowingly or recklessly participates in 

any violation of any law or regulation, any breach of fiduciary duty, 

or any unsafe or unsound practice that caused or is likely to cause 

more than a minimal financial loss to, or a significant adverse effect 

on, the Farm Credit System institution.

(4) LIABILITY OR LEGAL EXPENSE. The term "liability or 

legal expense" means—

(A) a legal or other professional expense incurred in 

connection with any claim, proceeding, or action;

(B) the amount of, and any cost incurred in connection with, 

any settlement of any claim, proceeding, or action; and

(C) the amount of, and any cost incurred in connection with, 

any judgment or penalty imposed with respect to any claim, 

proceeding, or action.

(5) PAYMENT. The term "payment" means—

(A) a direct or indirect transfer of any funds or any asset; and

(B) any segregation of any funds or assets for the purpose of 

making, or under an agreement to make, any payment after the date 

on which the funds or assets are segregated, without regard to 

whether the obligation to make the payment is contingent on—

(i) the determination, after that date, of the liability 

for the payment of the amount; or

(ii) the liquidation, after that date, of the amount of the 

payment.

(b) PROHIBITION. The Corporation may prohibit or limit, by 

regulation or order, any golden parachute payment or indemnification payment 

by a Farm Credit System institution (including any conservator or receiver of the 

Federal Agricultural Mortgage Corporation) in troubled condition (as defined in 

regulations issued by the Corporation).
(c) FACTORS TO BE TAKEN INTO ACCOUNT. The Corporation 

shall prescribe, by regulation, the factors to be considered by the Corporation in 

taking any action under subsection (b). The factors may include—

(1) whether there is a reasonable basis to believe that an 

institution-related party has committed any fraudulent act or omission, 

breach of trust or fiduciary duty, or insider abuse with regard to the Farm 

Credit System institution involved that has had a material effect on the 

financial condition of the institution;

(2) whether there is a reasonable basis to believe that the 

institution-related party is substantially responsible for the insolvency of 

the Farm Credit System institution, the appointment of a conservator or 

receiver for the institution, or the institution's troubled condition (as 

defined in regulations prescribed by the Corporation);

(3) whether there is a reasonable basis to believe that the 

institution-related party has materially violated any applicable law or 

regulation that has had a material effect on the financial condition of the 

institution;

(4) whether there is a reasonable basis to believe that the 

institution-related party has violated or conspired to violate—

(A) section 215, 657, 1006, 1014, or 1344 of title 18, United 

States Code; or

(B) section 1341 or 1343 of title 18, United States Code, 

affecting a Farm Credit System institution;

(5) whether the institution-related party was in a position of 

managerial or fiduciary responsibility; and

(6) the length of time that the party was related to the Farm Credit 

System institution and the degree to which—

(A) the payment reasonably reflects compensation earned 

over the period of employment; and

(B) the compensation represents a reasonable payment for 

services rendered.

(d) CERTAIN PAYMENTS PROHIBITED. No Farm Credit System 

institution may prepay the salary or any liability or legal expense of any 

institution-related party if the payment is made—

(1) in contemplation of the insolvency of the institution or after 

the commission of an act of insolvency; and

(2) with a view to, or with the result of—

(A) preventing the proper application of the assets of the 

institution to creditors; or

(B) preferring 1 creditor over another creditor.

(e) RULE OF CONSTRUCTION. Nothing in this section—

(1) prohibits any Farm Credit System institution from purchasing 

any commercial insurance policy or fidelity bond, so long as the insurance 

policy or bond does not cover any legal or liability expense of an 

institution described in subsection (a)(2); or

(2) limits the powers, functions, or responsibilities of the Farm 

Credit Administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-11

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-11 SEC. 5.62. INVESTMENT OF FUNDS.

Money of the Corporation not otherwise employed shall be invested in 

obligations of the United States or in obligations guaranteed as to principal and 

interest by the United States.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-12

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-12 SEC. 5.63. EXEMPTION FROM TAXATION.

Notwithstanding any other provision of law, the Corporation, including its 

franchise, and its capital, reserves, surplus, and income, shall be exempt from all 

taxation imposed by the United States, or by any State, county, municipality, or 

local taxing authority, except that any real property of the Corporation shall be 

subject to State, county, municipal, and local taxation to the same extent 

according to its value as other real property is taxed.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-13

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-13 SEC. 5.64. REPORTS.

(a) IN GENERAL. The Corporation annually shall prepare and submit 

to Congress a report of the operations of the Corporation, as soon as practicable 

after the first day of January in each calendar year.

(b) CONTENTS. Reports submitted under subsection (a) of this section 

shall include information concerning the—

(1) aggregate amount in the Insurance Fund at the close of the 

preceding calendar year;

(2) projections of the costs to be incurred by the Corporation 

during the calendar year; and

(3) estimates of the aggregate amount to be collected as premiums 

during the calendar year.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title V Farm Credit Administration Organization

Part: Part E Farm Credit System Insurance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-14

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-14 SEC. 5.65. PROHIBITIONS.

(a) CORPORATE NAME.

(1) USE OF CORPORATE NAME. It shall be unlawful for any 

person or entity to use the words "Farm Credit System Insurance 

Corporation" or any combination of such words that would have the effect 

of leading the public to believe that there is any connection between such 

person or entity and the Corporation, by virtue of the name under which 

such person or entity does business.

(2) FALSE REPRESENTATION.

(A) BY OUTSIDE PERSON OR ENTITIES. It shall be 

unlawful for any person or entity to falsely represent by any device, 

that the notes, bonds, debentures, or other obligations of the person 

or entity are insured or in any way guaranteed by the Corporation.

(B) SYSTEM BANKS. It shall be unlawful for any insured 

System bank or person that markets insured obligations to falsely 

represent the extent to which or the manner in which such 

obligations are insured by the Corporation.

(3) PENALTY. Any person or entity that willfully violates any 

provision of this subsection shall be fined not more than $1,000, 

imprisoned for not more than 1 year, or both.

(b) PAYMENTS OR DISTRIBUTIONS WHILE IN DEFAULT.

(1) IN GENERAL. It shall be unlawful for any insured System 

bank to pay any dividends on bank stock or participation certificates or 

interest on the capital notes or debentures of such bank (if such interest is 

required to be paid only out of net profits) or distribute any of the capital 

assets of such bank while the bank remains in default in the payment of any 

premium due to the Corporation.

(2) LIABILITY OF DIRECTORS. Each director or officer of any 

insured System bank who willfully participates in the declaration or 

payment of any dividend or interest or in any distribution in violation of 

this subsection shall be fined not more that $1,000, imprisoned not more 

than 1 year, or both.

(3) APPLICABILITY. This subsection shall not apply to any 

default that is due to a dispute between the insured System bank and the 

Corporation over the amount of such premium if such bank deposits 

security satisfactory to the Corporation for payment on final determination 

of the issue.

(c) FAILURE TO FILE STATEMENT OR PAY PREMIUM.
(1) IN GENERAL. Any insured System bank that willfully fails 

or refuses to file any certified statement or pay any premium required 

under this part shall be subject to a penalty of not more that $100 for each 

day that such violations continue, which penalty the Corporation may 

recover for its use.

(2) APPLICABILITY. This subsection shall not apply to conduct 

with respect to any default that is due to a dispute between the insured 

System bank and the Corporation over the amount of such premium if such 

bank deposits security satisfactory to the Corporation for payment on final 

determination of the issue.

(d) EMPLOYMENT OF PERSONS CONVICTED OF CRIMINAL 

OFFENSES.

(1) IN GENERAL. Except with the prior written consent of the 

Farm Credit Administration, it shall be unlawful for any person convicted 

of any criminal offense involving dishonesty or a breach of trust to serve as 

a director, officer, or employee of any System institution. 

(2) PENALTY. For each willful violation of paragraph (1), the 

institution involved shall be subject to a penalty of not more than $100 for 

each day during which the violation continues, which the Corporation may 

recover for its use.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: Subtitle A - Assistance Board

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a

Date Created: 12/17/2012

Date Modified: 2/15/2018

TITLE VI—ASSISTANCE TO FARM CREDIT SYSTEM

Subtitle A—Assistance Board

12 U.S.C. 2278a SEC. 6.0. ESTABLISHMENT OF BOARD.

(a) CHARTERS. On the date which is 15 days after the date of the 

enactment of this title, the Farm Credit Administration shall revoke the charter of 

the Farm Credit System Capital Corporation (hereinafter referred to in this title as 

the "Capital Corporation") and shall charter the Farm Credit System Assistance 

Board (hereinafter referred to in this Act as the "Assistance Board") that, subject 

to this subtitle, shall be a Federally chartered instrumentality of the United States.

(b) USE OF CAPITAL CORPORATION STAFF. During the 90-day 

period beginning on the date of the revocation of the charter of the Capital 

Corporation, the Assistance Board may temporarily employ, by contract or 

otherwise under reasonable and necessary terms and conditions, such staff of the 

Capital Corporation as is necessary to facilitate and effectuate an orderly 

transition to, and commencement of, the Assistance Board, and the termination of 

the affairs of the Capital Corporation.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-1

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-1 SEC. 6.1. PURPOSES.

The purposes of the Assistance Board shall be to carry out a program to 

provide assistance to, and protect the stock of borrowers of, the institutions of the 

Farm Credit System, and to assist in restoring System institutions to economic 

viability and permitting such institutions to continue to provide credit to farmers, 

ranchers, and the cooperatives of such, at reasonable and competitive rates.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-2

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-2 SEC. 6.2. BOARD OF DIRECTORS.

(a) MEMBERSHIP. The Board of Directors of the Assistance Board 

(hereinafter referred to in this subtitle as the "Board of Directors") shall consist of 

three members—

(1) one of which shall be the Secretary of the Treasury;

(2) one of which shall be the Secretary of Agriculture; and

(3) one of which shall be an agricultural producer experienced in 

financial matters, and appointed by the President, by and with the advice 

and consent of the Senate.

(b) CHAIRMAN. The Board of Directors shall elect annually a 

Chairman from among the members of the Board.

(c) TERMS OF OFFICE, SUCCESSION, AND VACANCIES.

(1) TERMS OF OFFICE AND SUCCESSION. The term of each 

member of the Board of Directors shall expire when the Assistance Board 

is terminated.

(2) VACANCIES. Vacancies on the Board of Directors shall be 

filled in the same manner as the vacant position was previously filled.

(d) COMPENSATION OF BOARD MEMBERS. Members of the 

Board of Directors—

(1) appointed under paragraphs (1) and (2) of subsection (a) of this 

section shall receive reasonable allowances for necessary expenses of 

travel, lodging, and subsistence incurred in attending meetings and other 

activities of the Assistance Board, as set forth in the bylaws issued by the 

Board of Directors, except that such level shall not exceed the maximum 

fixed by subchapter I of chapter 57 of Title 5, United States Code, for 

officers and employees of the United States; and

(2) appointed under paragraph (3) of subsection (a) of this section 

shall receive compensation for the time devoted to meetings and other 

activities at a daily rate not to exceed the daily rate of compensation 

prescribed for Level III of the Executive Schedule under section 5314 of 

Title 5, United States Code, and reasonable allowances for necessary 

expenses of travel, lodging, and subsistence incurred in attending meetings 

and other activities of the Assistance Board, as set forth in the bylaws 

issued by the Board of Directors, except that such level shall not exceed the 

maximum fixed by subchapter I of chapter 57 of Title 5, United States 

Code, for officers and employees of the United States.

(e) RULES AND RECORDS. The Board of Directors of the Assistance 

Board shall adopt such rules as it may deem appropriate for the transaction of the 
business of the Assistance Board, and shall keep permanent and accurate records 

and minutes of its acts and proceedings.

(f) QUORUM REQUIRED. A quorum shall consist of two members of 

the Board of Directors. All decisions of the Board shall require an affirmative 

vote of at least a majority of the members voting.

(g) CHIEF EXECUTIVE OFFICER. A chief executive officer of the 

Assistance Board shall be selected by the Board of Directors of the Assistance 

Board and shall serve at the pleasure of the Board.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-3

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-3 SEC. 6.3. CORPORATE POWERS.

(a) IN GENERAL. The Assistance Board shall be a body corporate that 

shall have the power to—

(1) operate under the direction of its Board of Directors;

(2) adopt, alter, and use a corporate seal, which shall be judicially 

noted;

(3) provide for one or more vice presidents, a secretary, a treasurer, 

and such other officers, employees, and agents, as may be necessary, 

define their duties, and require surety bonds or make other provisions 

against losses occasioned by acts of such persons;

(4) hire, promote, compensate, and discharge officers and 

employees of the Assistance Board, without regard to Title 5, United States 

Code, except that no such officer or employee shall receive an annual rate 

of basic pay in excess of the rate prescribed for Level III of the Executive 

Schedule under section 5314 of Title 5, United States Code;

(5) prescribe by its Board of Directors its bylaws, that shall be 

consistent with law, and that shall provide for the manner in which—

(A) its officers, employees, and agents are selected;

(B) its property is acquired, held, and transferred;

(C) its general operations are to be conducted; and

(D) the privileges granted by law are exercised and enjoyed;

(6) with the consent of any executive department or independent 

agency, use the information, services, staff, and facilities of such in 

carrying out this title;

(7) enter into contracts and make advance, progress, or other 

payments with respect to such contracts;

(8) sue and be sued in its corporate name, and complain and 

defend in courts of competent jurisdiction;

(9) acquire, hold, lease, mortgage, or dispose of, at public or 

private sale, real and personal property, and otherwise exercise all the usual 

incidents of ownership of property necessary and convenient to its 

operations;

(10) obtain insurance against loss;

(11) modify or consent to the modification of any contract or 

agreement to which it is a party or in which it has an interest under this title;

(12) deposit its securities and its current funds with any member 

bank of the Federal Reserve System or any insured State nonmember bank 

(within the meaning of section 3 of the Federal Deposit Insurance Act (12 
U.S.C. 1813)) and pay fees therefor and receive interest thereon as may be 

agreed; and 

(13) exercise other powers as set forth in this title, and such other 

incidental powers as are necessary to carry out its powers, duties, and 

functions in accordance with this title.

(b) POWER TO REMOVE; JURISDICTION. Notwithstanding any 

other provision of law, any civil action, suit, or proceeding to which the 

Assistance Board is a party shall be deemed to arise under the laws of the United 

States, and the United States District Court for the District of Columbia shall 

have exclusive jurisdiction over such. The Assistance Board may, without bond 

or security, remove any such action, suit, or proceeding from a State court to the 

United States District Court for the District of Columbia.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-4

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-4 SEC. 6.4. CERTIFICATION OF ELIGIBILITY TO ISSUE 

PREFERRED STOCK.

(a) BOOK VALUE LESS THAN PAR VALUE OF STOCK AND 

EQUITIES. If the book value of the stock, participation certificates, and other 

similar equities of a System institution, based on generally accepted accounting 

principles, is less than the par value of the stock or the face value of the 

certificates or equities—

(1) the Farm Credit Administration shall notify the Assistance 

Board of such impairment;

(2) the Assistance Board shall monitor the financial condition, 

business plans, and operations of the institution; and

(3) the institution may request the Assistance Board to grant 

certification to issue preferred stock under section 6.27(a).

(b) BOOK VALUE LESS THAN 75 PERCENT OF PAR VALUE OF 

STOCK AND EQUITIES. If the book value of the stock, participation 

certificates, and other similar equities of a System institution, based on generally 

accepted accounting principles, is less than 75 percent of the par value of the 

stock or the face value of the certificates or equities, the institution shall request 

the Assistance Board to grant certification to issue preferred stock under section 

6.27(a).

(c) MANDATORY DETERMINATION OF ELIGIBILITY.

(1) IN GENERAL. The Assistance Board shall determine whether 

to certify a System institution as eligible to issue preferred stock under 

section 6.27, if—

(A) the institution requests such certification;

(B) the book value of the stock, participation certificates, 

and other similar equities of the institution, based on generally 

accepted accounting principles, has declined to 75 percent of the par 

value of the stock or the face value of the certificates or equities; and

(C) the institution agrees to meet the terms and conditions 

specified by the Assistance Board pursuant to section 6.6.

(2) EFFECTIVE DATE OF CERTIFICATION. If the 

determination of the Assistance Board is to certify the institution under 

paragraph (1), such certification shall be effective at the time of such 

determination.

(d) IMPLEMENTATION. As soon as practicable after the date of the 

enactment of this title, the Assistance Board shall take such actions as are 

necessary to carry out this section.
(e) DEFINITION. Except where otherwise provided in this Act, the 

term "other similar equities" includes allocated equities.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-5

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-5 SEC. 6.5. ASSISTANCE.

(a) IN GENERAL. The Assistance Board shall assist an institution that 

has been certified under section 6.4 by—

(1) authorizing the institution to issue preferred stock under 

section 6.27, in amounts necessary to maintain the book value of stock, 

participation certificates, and other similar equities of the institution, at the 

level provided for in subsection (c) of this section;

(2) in the case of high-cost debt for which the institution is 

primarily liable, authorizing the institution to issue preferred stock under 

section 6.27, in an amount equal to the premium that would be required by 

the holder of the debt for the institution to retire the debt at the then current 

market value;

(3) on a request by the institution, authorizing the issuance of 

preferred stock under section 6.27 to facilitate the merger of the requesting 

institution with one or more other System institutions; or

(4) providing assistance by such other methods as the Assistance 

Board determines appropriate.

(b) DEFINITION OF HIGH-COST DEBT. For purposes of subsection 

(a)(2) of this section, the term "high-cost debt" means securities or similar 

obligations issued before January 1, 1986, that mature on or after December 31, 

1987, and bear a rate of interest in excess of the then current market rate for 

similar securities or obligations.

(c) MINIMUM EQUITY VALUE. The Assistance Board shall 

authorize a certified institution to issue amounts of preferred stock under section 

6.27 sufficient to—

(1) maintain the value of stock, participation certificates and other 

similar equities at no less than 75 percent of the par value of the stock or 

the face value of the certificates or equities, as determined under generally 

accepted accounting principles; and

(2) strengthen the institution to a point where it is economically 

viable, and capable of delivering credit at reasonable and competitive rates.

(d) LIMITATION. Except as provided in section 410(c) of the 

Agricultural Credit Act of 1987, no assistance shall be provided in connection 

with a merger until the stockholders and the institutions involved have approved 

the merger and the Farm Credit Administration has given final approval to the 

merger plan.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-6

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-6 SEC. 6.6. SPECIAL POWERS.

(a) IN GENERAL. In the case of a System institution that requests 

certification under section 6.4, the Assistance Board may—

(1) require the institution to obtain approval from the Assistance 

Board before implementing business, operating, and investment plans and 

policies;

(2) if one or more of the conditions described in section 4.12(b) 

are met, as determined by the Farm Credit Administration, direct the Farm 

Credit Administration Board to appoint a conservator for the institution, in 

accordance with such section, and to instruct the conservator to evaluate 

the operations of the institution and report to the Farm Credit 

Administration Board and the Assistance Board on the possibility of 

restoring the institution to sound financial condition;

(3) request that the Farm Credit Administration Board or the Farm 

Credit Administration, as appropriate—

(A) approve or require a merger or consolidation of the 

institution to the extent authorized under this Act;

(B) initiate action to appoint a receiver under section 4.12(b); 

or

(C) exercise any enforcement power authorized under this 

Act;

(4) require the institution to obtain approval from the Assistance 

Board before setting the terms and conditions of any debt issuances of the 

institution;

(5) require the institution to obtain approval from the Assistance 

Board before setting the policy on credit standards to be used, and the 

policy on rates of interest to be charged on loans, by the institution, 

including requiring that—

(A) the institution set interest rates at levels necessary to 

ensure that the cost of money to the institution reflects the marginal 

cost to the institution of borrowing an additional amount of money at 

the time a new loan is made; and

(B) loans primarily secured by real estate mortgages not 

exceed 85 percent of the appraised agricultural value of the real 

estate security, or 75 percent of the then current market value of the 

real estate security, whichever is greater;

(6) require the institution to obtain approval from the Assistance

Board for the design of management information and accounting systems 
at the institution, and of the continued use by the institution of regulatory 

accounting practices in accordance with sections 4.8(b) and 5.19(b);

(7) require that the plans and policies of the institution resulting 

from the merger of System banks reduce the overhead costs of such 

institution, to the maximum extent practicable, with respect to the delivery 

of services to, and performance of duties for, System associations in the 

district;

(8) require the institution to obtain approval from the Assistance 

Board of—

(A) the hiring policies of the institution;

(B) the compensation and retirement benefits of the chief 

executive officer, other managers, and directors of the institution;

(C) any change in the management of the institution; and

(D) policy decisions regarding continued employment and 

promotion of the officials referred to in subparagraph (B);

(9) suspend for any period of time, or terminate, any certification 

granted to an institution under section 6.4 if the Farm Credit 

Administration notifies the Assistance Board that the institution has 

substantially deviated from the institution's business plan or has failed to 

comply with a term or condition governing the use of any financial 

assistance provided to the institution under this title; and

(10) take such other action as the Assistance Board determines may 

be necessary to establish prudent operating practices at the institution and 

to return the institution to a sound financial condition.

(b) SUSPENSION OF ASSISTANCE.

(1) NOTIFICATION. The Assistance Board shall promptly notify 

the Farm Credit Administration of any action taken by the Assistance 

Board under subsection (a)(9) of this section.

(2) ENFORCEMENT. The Farm Credit Administration may use 

any of its enforcement powers, with respect to any institution to which the 

Assistance Board has provided assistance or has certified the institution to 

issue preferred stock under section 6.27, to obtain the compliance of the 

institution with the terms or conditions governing the use of financial 

assistance provided under this title.

(c) UNDATED LETTERS OF RESIGNATION. The Assistance Board 

shall not, for any reason, request or require any member of the board of directors 

of any System institution to submit to the Assistance Board an undated letter of 

resignation. Immediately after the date of the enactment of this title, the 

Assistance Board shall destroy all such letters over which it has control.

(d) REPORTS. During the 5-year period beginning on the date of the 

enactment of this title, the Assistance Board, in coordination with the Financial 

Assistance Corporation, shall report annually to the Committee on Agriculture of 

the House of Representatives and the Committee on Agriculture, Nutrition, and 

Forestry of the Senate on the extent to which System institutions translate the 

savings in the cost of the operations of such institutions due to the Federal 

assistance provided to the System under this title into lower interest rates charged 

to System borrowers or enhanced financial solvency of such institutions.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: Subtitle A - Assistance Board

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-7

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-7 SEC. 6.7. ADMINISTRATION.

(a) EXPENSES. The Financial Assistance Corporation shall pay the 

necessary and reasonable administrative expenses of the Assistance Board from 

funds in the Assistance Fund established in section 6.25.

(b) INTERIM FUNDING. Before the availability of funding from the 

Assistance Fund, the Assistance Board may use the revolving fund established 

under section 4.0. Such amounts used shall be repaid to the revolving fund out of 

the Assistance Fund within the same fiscal year that such funds were received by 

the Assistance Board.

(c) ASSISTANCE OPERATIONS. The Farm Credit Administration 

shall provide such personnel and facilities to the Assistance Board as the Farm 

Credit Administration considers are necessary to avoid unnecessary duplication 

and waste.

(d) ACCESS TO FCA DOCUMENTS. The Assistance Board shall 

have access to all reports of examination and supervisory documents of the Farm 

Credit Administration, and relevant supporting material, for the purpose of 

carrying out the special powers of the Assistance Board under section 6.6, under 

such terms and conditions, acceptable to the Farm Credit Administration Board, 

as are necessary and appropriate to protect the confidentiality of the documents 

and materials.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-8

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-8 SEC. 6.8. LIMITATION OF POWERS.

(a) PURPOSES. The powers of the Assistance Board under this title 

shall be exercised only for the purposes specified in this title and shall not be 

exercised in a manner that would result in the Assistance Board supplanting the 

Farm Credit System lending institutions as the primary providers of credit and 

other financial services to farmers, ranchers, and the cooperatives of such.

(b) PROHIBITION. The powers of the Assistance Board under this title 

shall not include the management, administration, or disposition of any loans or 

other assets owned by other System institutions, or the providing of technical 

assistance or other related services to other System institutions in connection 

with the administration of loans owned by such other institutions.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-9

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-9 SEC. 6.9. SUCCESSION.

(a) ASSETS AND LIABILITIES. On the issuance by the Farm Credit 

Administration of the charter for the Assistance Board under this subtitle, the 

Assistance Board shall succeed to the assets of and assume all debts, obligations, 

contracts, and other liabilities of the Capital Corporation, matured or unmatured, 

accrued, absolute, contingent or otherwise, and whether or not reflected or 

reserved against on balance sheets, books of account, or records of the Capital 

Corporation.

(b) CONTRACTS. The existing contractual obligations, security 

instruments, and title instruments of the Capital Corporation shall, by operation 

of law and without any further action by the Farm Credit Administration, the 

Capital Corporation, or any court, become and be converted into obligations, 

entitlements, and instruments of the Assistance Board chartered under this 

subtitle.

(c) ADJUSTMENT OF ASSESSMENTS. Not later than 15 days after 

the issuance of the charter of the Assistance Board, the Board shall retire all debt 

and equity obligations issued to any System institution under section 4.28G(a)(14) 

or 4.28H (as in effect immediately before the date of the enactment of this title) 

at the book value of such obligations (determined as of such date of enactment) 

and shall pay such amounts to the holders of such debt and equity obligations.

(d) SURPLUS FUNDS. To the extent that, on the extinguishing of 

liabilities assumed by the Assistance Board under this section, and on full 

performance or other final disposition of contract obligations of the Assistance 

Board, there remain surplus funds attributable to such obligations or contracts, 

the Assistance Board shall distribute such surplus funds among the System 

institutions that contributed funds to the Capital Corporation on the basis of the 

relative amount of funds so contributed by each institution.

(e) PRESERVATION AGREEMENTS.

(1) TRANSFER OF OBLIGATIONS. Notwithstanding any other 

provision of this Act or the terms and conditions of the Thirty-Seven Banks 

Capital Preservation Agreement, the Federal Land Banks Capital 

Preservation Agreement, the Federal Intermediate Credit Banks Capital 

Preservation Agreement, and the Banks for Cooperatives Loss Sharing 

Agreement—

(A) at the time the receiving bank receives funds from the 

Financial Assistance Corporation in an equal and equivalent amount 

in accordance with this subsection, any amounts received by, or that 

remain accrued to, any System bank in accordance with the 
activation of any such agreement for the calendar quarter ending on 

September 30, 1986, shall be—

(i) repaid to the contributing bank by the bank that 

received such payments; or

(ii) cancelled;

(B) on the date the Financial Assistance Corporation is 

chartered, the accounts payable of each contributing bank under such 

agreements for the calendar quarter ending on September 30, 1986, 

shall, by operation of law and without any further action by such 

contributing bank, any other bank, or any court, become and be 

converted into accounts payable of the Financial Assistance 

Corporation to each receiving bank under such agreement for such 

calendar quarter in the same amounts as previously carried on the 

books of each such receiving bank; and

(C) on the date the Financial Assistance Corporation is 

chartered, the accounts receivable of each receiving bank under such 

agreements for the calendar quarter ending September 30, 1986, shall, 

by operation of law and without any further action by such receiving 

bank or any other bank, or any court, become and be converted into 

accounts receivable to such receiving bank from the Financial 

Assistance Corporation, in the same amount as previously carried on 

the books of such receiving bank and such receivables shall, for all 

financial reporting purposes, be accounted for as an asset on the 

books of such receiving bank in accordance with generally accepted 

accounting practices.

(2)(A) Not later than 30 days after the first issuance of obligations 

by the Financial Assistance Corporation in accordance with section 6.26, 

the Corporation shall pay to each receiving bank such sums as are 

necessary to permit each receiving bank to repay, in accordance with 

paragraph (1), the amounts each such receiving bank received under any 

such agreement.

(B) The accruals shall be paid by the Corporation to each 

receiving bank for the actual net loan charge-offs recorded on the 

books of each such bank before January 1, 1993, not previously paid 

by the contributing banks.

(3) DEBT OBLIGATIONS.

(A) ISSUANCE. For the purpose of obtaining funds to carry 

out this subsection, the Financial Assistance Corporation shall issue 

debt obligations under section 6.26. Such obligations shall be 

subject to the terms and conditions of such section, except as 

provided for in this paragraph.

(B) PAYMENT OF INTEREST. During each year of the 

15-year period of such obligation issued pursuant to subparagraph 

(A), the banks operating under this Act shall pay to the Financial 

Assistance Corporation, at such times as the Corporation shall 

determine, an amount equal to the entire amount of interest due on 

such obligation. Each bank shall pay a proportion of such interest 

equal to—

(i) the average accruing loan volume of the bank 

during the year preceding the year of such payment; divided by
(ii) the average accruing loan volume of all of the 

banks of the System for the same period.

(C) PAYMENT OF PRINCIPAL.

(i) IN GENERAL. After the end of the 15-year 

period beginning on the date of the issuance of any obligation 

issued to carry out this subsection, the banks operating under 

this Act shall pay to the Financial Assistance Corporation, on 

demand, an amount equal to the outstanding principal of the 

obligation. Each bank shall pay a proportion of the principal 

equal to—

(I) the average accruing loan volume of the 

bank for the preceding 15 years; divided by

(II) the average accruing loan volume of all 

banks of the System for the same period.

(ii) BANKS LEAVING SYSTEM. Any bank leaving 

the Farm Credit System pursuant to section 7.10 shall be 

required, under regulations of the Farm Credit Administration, 

to pay to the Financial Assistance Corporation the estimated 

present value of the payment required under this subparagraph 

had the bank remained in the System.

(iii) BANKS UNDERGOING LIQUIDATION. With 

respect to any bank undergoing liquidation under this Act, a 

liability to the Financial Assistance Corporation in the amount 

of the payment required under this subparagraph (calculated as 

if the bank had left the System on the date it was placed in 

liquidation) shall be recognized as a claim in favor of the 

Financial Assistance Corporation against the estate of the bank.

(iv) OBLIGATIONS OF OTHER BANKS. The 

obligations of other banks shall not be reduced in anticipation 

of any recoveries under this subparagraph from banks leaving 

the System or in liquidation, but the Financial Assistance 

Corporation shall apply the recoveries, when received, and all 

earnings on the recoveries, to reduce the other banks' payment 

obligations, or, to the extent the recoveries are received after 

the other banks have met their entire payment obligation, shall 

refund the recoveries, when received, to the other banks in 

proportion to the other banks' payments.

(D) ANNUAL PAYMENTS.

(i) IN GENERAL. In order to provide for the orderly 

funding and discharge over time of the obligation of each 

System bank to the Financial Assistance Corporation under 

subparagraph (C), each System bank shall enter into or 

continue in effect an agreement with the Financial Assistance 

Corporation under which the bank will make annual annuitytype payments to the Financial Assistance Corporation, 

beginning no later than December 31, 1992 (except for any 

bank that did not meet its interim capital requirement on 

December 31, 1990, in which case the bank shall begin making 

the payments no later than December 31, 1993) in amounts 

designed to accumulate, in total, including earnings on the 

amounts, to 90 percent of the bank's ultimate obligation. The 
Financial Assistance Corporation shall partially discharge the 

bank from its obligation under subparagraph (C) to the extent 

of each such payment and the earnings on the payment as 

earned.

(ii) CAPITAL REQUIREMENTS. The agreement 

shall not require payments to be made to the extent that 

making a particular payment or part of a payment would cause 

the bank to fail to satisfy applicable regulatory permanent 

capital requirements, but shall provide for recalculation of 

subsequent payments accordingly.

(iii) INVESTMENT; AVAILABILITY. The funds 

received by the Financial Assistance Corporation pursuant to 

the agreements shall be invested in eligible investments as 

defined in section 6.25(a)(1). The funds and the earnings on 

the funds shall be available only for the payment of the 

principal of the bonds issued by the Financial Assistance 

Corporation under this subsection.

(E) Until each obligation issued in accordance with this 

subsection reaches maturity, for all financial reporting purposes, 

such obligation shall be considered to be the sole obligation of the 

Financial Assistance Corporation and shall not be considered a 

liability of any System bank, nor shall the obligation to make future 

annuity payments to the Financial Assistance Corporation under 

subparagraph (D) be considered a liability of any System bank.

(4) FUNDS NOT CONSIDERED FINANCIAL ASSISTANCE. 

The funds made available to each bank, whether through the issuance of 

stock or otherwise, by the Financial Assistance Corporation to meet 

obligations under any agreement referred to in paragraph (1) or to meet any 

obligations of the contributing banks under any such agreement, as 

required by this subsection, shall not be considered financial assistance 

under this Act.

(5) SUSPENSION OF PRESERVATION AGREEMENTS. 

During the 5-year period beginning on the date of enactment of this 

subsection and thereafter whenever funds from the Farm Credit System 

Insurance Fund are available for use in assisting System institutions to 

meet their obligations on their debt instruments, activation of the ThirtySeven Banks Capital Preservation Agreement, the Federal Land Banks 

Capital Preservation Agreement, the Federal Intermediate Credit Banks 

Capital Preservation Agreement, and the Banks for Cooperatives Loss 

Sharing Agreement shall be suspended, in exchange for the benefits 

flowing to the signatories to such agreements under the Agricultural Credit 

Act of 1987.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-10

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-10 SEC. 6.10. EFFECT OF REGULATIONS; AUDITS.

(a) ISSUANCE. The Assistance Board may issue such regulations, 

policies, procedures, guidelines, or statements as the Board considers necessary 

or appropriate to carry out this title, all of which shall be promulgated and 

enforced without regard to subchapter II of chapter 5 of Title 5, United States 

Code.

(b) REGULATION BY FARM CREDIT ADMINISTRATION. The 

Assistance Board shall not be subject to regulation by the Farm Credit 

Administration.

(c) AUDITS. The Assistance Board shall not require an audit or 

examination of a System institution that would be duplicative of an audit or 

examination that is conducted under other provisions of law.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-11

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-11 SEC. 6.11. EXEMPTION FROM TAXATION.

The Assistance Board, the capital, reserves, and surplus thereof, and the 

income derived therefrom, shall be exempt from Federal, State, municipal, and 

local taxation, except taxes on real estate held by the Assistance Board to the 

same extent, according to its value, as other similar property held by other 

persons is taxed.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-12

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-12 SEC. 6.12. TERMINATION.

The Assistance Board and the authority provided to the Assistance Board 

by this subtitle shall terminate on December 31, 1992.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle A - Assistance Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278a-13

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278a-13 SEC. 6.13. TRANSITIONAL PROVISIONS.

(a) EXERCISE OF POWERS. The powers of the Assistance Board 

under this title shall be exercised by the Farm Credit Administration Board until 

the issuance of the charter of the Assistance Board, or such later date not to 

exceed 30 days thereafter, as may be requested by the Assistance Board.

(b) LIMITATION ON ASSISTANCE. Any assistance provided to 

System institutions by the Farm Credit Administration in accordance with this 

section shall be provided from, and shall not exceed, the amounts contained in 

the revolving fund established under section 4.0.

(c) ISSUANCE OF STOCK. Each institution that receives assistance 

from the Farm Credit Administration during the interim period specified in 

subsection (a) of this section, in consideration thereof, shall issue preferred stock 

to the Financial Assistance Corporation in an amount equal to the amount of such 

assistance. Payments by the Financial Assistance Corporation under subsection 

(d) of this section shall be considered to be payments to each such institution for 

such stock.

(d) REPAYMENT. The Financial Assistance Corporation shall pay to 

the Farm Credit Administration, for return to the revolving fund established 

under section 4.0, the full amount of all financial assistance provided by the Farm 

Credit Administration in accordance with this section, from the proceeds from 

the sale of the first issue of obligations by the Financial Assistance Corporation 

in accordance with section 6.26.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: Subtitle B-Financial Assistance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b

Date Created: 12/17/2012

Date Modified: 2/15/2018

Subtitle B—Financial Assistance Corporation

12 U.S.C. 2278b SEC. 6.20. ESTABLISHMENT OF CORPORATION.

Not later than 5 days after the date of the enactment of this title, the Farm 

Credit Administration shall charter the Farm Credit System Financial Assistance 

Corporation (hereinafter referred to in this Act as the "Financial Assistance 

Corporation") which shall be—

(1) an institution of the Farm Credit System; and

(2) a Federally chartered instrumentality of the United States.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-1

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-1 SEC. 6.21. PURPOSE.

The purpose of the Financial Assistance Corporation shall be to carry out a 

program to provide capital to institutions of the Farm Credit System that are 

experiencing financial difficulty and to assist, pursuant to section 6.9(e) and 

subsections (c) through (g) of section 6.26, in the repayment by System 

institutions to those persons who provided funds in connection with the program.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-2

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-2 SEC. 6.22. BOARD OF DIRECTORS.

(a) BOARD OF DIRECTORS.

(1) COMPOSITION. The Board of Directors of the Financial 

Assistance Corporation (hereinafter referred to in this subtitle as the 

"Board of Directors") shall consist of the Board of Directors of the Federal 

Farm Credit Banks Funding Corporation.

(2) CHAIRMAN. The Board of Directors shall elect annually a 

Chairman from among the members of the Board.

(3) COMPENSATION. The members of the Board of Directors 

shall receive compensation for the time devoted to meetings and other 

activities of the Board and reasonable allowances for necessary expenses of 

travel, lodging, and subsistence incurred in attending meetings and other 

activities of the Board of Directors in amounts not exceeding levels set by 

the Farm Credit Administration Board.

(b) RULES AND RECORDS. The Board of Directors shall adopt such 

rules as it may deem appropriate for the transaction of its business and shall keep 

permanent and accurate records and minutes of its acts and proceedings.

(c) QUORUM REQUIRED. No business may be conducted at a 

meeting of the Board of Directors unless a quorum of the members of the Board 

is present, and a vote to approve an action requires a majority vote of the 

members voting.

(d) CHIEF EXECUTIVE OFFICER. A chief executive officer of the 

Financial Assistance Corporation shall be selected by the Board of Directors and 

shall serve at the pleasure of the Board.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-3

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-3 SEC. 6.23. STOCK.

The Financial Assistance Corporation shall issue stock with a par value of 

$5 to System institutions, as provided for in this subtitle, and such stock shall not 

be transferable, except in the event of a restructuring or liquidation to a successor 

System institution.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-4

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-4 SEC. 6.24. CORPORATE POWERS.

(a) IN GENERAL. The Financial Assistance Corporation shall have the 

power to—

(1) operate under the direction of its Board of Directors;

(2) adopt, alter, and use a corporate seal, which shall be judicially 

noted;

(3) provide for such officers, employees, and agents, including 

joint employees with the Funding Corporation, as may be necessary, define 

their duties, and require surety bonds or make other provisions against 

losses occasioned by acts of such persons;

(4) adopt a salary for officers and employees of the Financial 

Assistance Corporation, in accordance with the directives of the Board of 

Directors;

(5) prescribe by its Board of Directors bylaws, that are not 

inconsistent with law, and that shall provide for the manner in which—

(A) its officers, employees, and agents are selected;

(B) its property is acquired, held, and transferred;

(C) its general business is conducted; and

(D) the privileges granted by law are exercised and enjoyed;

(6) enter into contracts and make advance, progress, or other 

payments with respect to such contracts;

(7) sue and be sued in its corporate name and complain and defend 

in courts of competent jurisdiction;

(8) acquire, hold, lease, mortgage, or dispose of, at public or 

private sale, real and personal property, and otherwise exercise all the usual 

incidents of ownership of property necessary and convenient to its business;

(9) obtain insurance against loss;

(10) modify or consent to the modification of any contract or 

agreement to which it is a party or in which it has an interest under this 

subtitle;

(11) borrow from any commercial bank on its own individual 

responsibility and on such terms and conditions as it may determine with 

the approval of the Farm Credit Administration;

(12) deposit its securities and its current funds with any member 

bank of the Federal Reserve System or any insured State nonmember bank 

(within the meaning of section 3 of the Federal Deposit Insurance Act (12 

U.S.C. 1813)) and pay fees therefor and receive interest thereon as may be 

agreed; and
(13) exercise such other incidental powers as are necessary to carry 

out its powers, duties, and functions in accordance with its charter and this 

subtitle.

(b) POWER TO REMOVE, AND JURISDICTION. Notwithstanding 

any other provision of law, any civil action, suit, or proceeding to which the 

Financial Assistance Corporation is a party shall be deemed to arise under the 

laws of the United States, and the United States District Court for the District of 

Columbia shall have exclusive jurisdiction over such. The Financial Assistance 

Corporation may, without bond or security, remove any such action, suit, or 

proceeding from a State court to the United States District Court for the District 

of Columbia.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-5

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-5 SEC. 6.25. ACCOUNTS.

(a) FARM CREDIT ASSISTANCE FUND.

(1) ESTABLISHMENT. The Financial Assistance Corporation 

shall establish an account called the Farm Credit Assistance Fund (referred 

to in this Act as the "Assistance Fund") which shall be available to the 

Financial Assistance Corporation as a revolving fund to carry out this 

subtitle. The moneys of such Assistance Fund shall be invested in direct 

obligations of the United States or obligations guaranteed by the United 

States or an agency thereof.

(2) FUNDING. The Assistance Fund shall be funded through the 

issuance of debt obligations and payments, as provided in section 6.26, and 

payments, as provided in section 6.28.

(b) FINANCIAL ASSISTANCE CORPORATION TRUST FUND. The 

Financial Assistance Corporation shall establish an account called the Financial 

Assistance Corporation Trust Fund (hereinafter referred to in this Act as the 

"Trust Fund") that shall consist of securities of the United States Treasury 

purchased by the Financial Assistance Corporation with the funds received from 

the purchase of stock by System institutions from the Financial Assistance 

Corporation under section 6.29.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-6

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-6 SEC. 6.26. DEBT OBLIGATIONS.

(a) ISSUANCE. During the period beginning 61 days after the date of 

the enactment of this title and ending September 30, 1992, the Financial 

Assistance Corporation, subject to the approval of the Assistance Board, may 

issue uncollateralized bonds, notes, debentures, and similar obligations, 

guaranteed as to the timely payment of principal and interest by the Secretary of 

the Treasury as set forth in subsection (d) of this section, with semiannual interest 

coupon payments and a maturity period of 15 years—

(1) in an aggregate amount not to exceed $2,800,000,000; and

(2) beginning January 1, 1989, in an additional amount, not to 

exceed $1,200,000,000, if—

(A) debt obligations have been issued by the Corporation to 

the full extent authorized under paragraph (1);

(B) the Assistance Board determines that such additional 

funds are needed to carry out this title; and

(C) at least 90 days before the issuance of any debt 

obligations under this paragraph, the Assistance Board submits a 

report to Congress that sets forth the determination of the Assistance 

Board that such additional debt obligations should be issued, and that 

contains a detailed evaluation supporting the determination.

(b) CONDITIONS. The debt obligations shall be in such forms and 

denominations, bear such rates of interest, be subject to such conditions, be 

issued in such manner, and be sold at such prices as may be prescribed by the 

Financial Assistance Corporation.

(c) INTEREST PAYMENTS.

(1) PAYMENT OF INTEREST DURING FIRST 5-YEAR 

PERIOD. During each year of the first 5-year period of the 10-year period 

beginning on the date of issuance of each obligation under subsection (a) of 

this section, the Financial Assistance Corporation shall pay, without 

recourse to System institutions, other than that described in paragraph (5), 

all of the interest due on such obligation.

(2) PAYMENT OF INTEREST DURING SECOND 5-YEAR 

PERIOD.

(A) IN GENERAL. During each year of the second 5-year 

period of the 10-year period beginning on the date of issuance of 

each obligation under subsection (a) of this section, the Financial 

Assistance Corporation shall pay all of the interest due on such 

obligation.
(B) PAYMENT BY SYSTEM BANKS TO FINANCIAL 

ASSISTANCE CORPORATION. During each year of the second 5-

year period, System banks shall pay to the Financial Assistance 

Corporation 50 percent of the interest due on the obligations, except 

that System banks shall pay an additional 10 percent of the interest 

expense for each 1 percent that the unallocated retained earnings of 

the System (as determined under generally accepted accounting 

principles) exceed 5 percent of net assets (total assets less allowance 

for loan losses) based on a year-end financial statement for the 

preceding year.

(C) ALLOCATION. During each year of the second 5-year 

period, each System bank shall pay to the Financial Assistance 

Corporation a proportion, as calculated by the Financial Assistance 

Corporation, of the interest due from System banks under this 

paragraph equal to—

(i) the amount of the average accruing retail loan 

volume of the bank and its affiliated associations for the 

preceding year; divided by

(ii) the total average accruing retail loan volume of all 

such banks and their affiliated associations for the preceding 

year.

(3) PAYMENTS BY TREASURY. The Secretary of the Treasury, 

in accordance with section 6.28, shall pay to the Financial Assistance 

Corporation, in a timely manner, the balance of each interest payment not 

made by the System banks.

(4) PAYMENT OF INTEREST AFTER FIRST 10-YEAR 

PERIOD. During each year of the third 5-year period of the 15-year period 

beginning on the date of the issuance of each obligation under subsection 

(a) of this section, the Financial Assistance Corporation shall pay all of the 

interest due on such obligation. During each year of such 5-year period, 

System banks shall pay the entire amount of interest due on the obligation 

allocated in the same manner as under paragraph (2)(C). Such payments

shall be made to the Financial Assistance Corporation at such times as the 

Financial Assistance Corporation shall determine.

(5) REPAYMENT OF TREASURY-PAID INTEREST.

(A) IN GENERAL. On the maturity date of the lastmaturing debt obligation issued under subsection (a), the Financial 

Assistance Corporation shall repay to the Secretary of the Treasury 

the total amount of any annual interest charges on the debt 

obligations that Farm Credit System institutions (other than the 

Financial Assistance Corporation) have not previously paid, and the 

Financial Assistance Corporation shall not be required to pay any 

additional interest charges on the payments.

(B) ASSESSMENT. In order to provide for the orderly 

funding by the banks of the System of the repayment by the 

Financial Assistance Corporation to the Secretary of the Treasury, 

the Financial Assistance Corporation shall assess each System bank, 

on or about December 31 of each year beginning in 1992, and each 

System bank shall promptly pay to the Financial Assistance 

Corporation, an annual annuity type payment in an amount designed 

to accumulate, in total, including earnings thereon, the amount of the 
bank's ultimate obligation (as determined by the Corporation on a 

fair and equitable basis), and no greater than .0006 nor less 

than .0004 times the bank's and its affiliated association's average 

accruing retail loan volume for the preceding year, subject to—

(i) upward or downward adjustment, as appropriate, 

by the Financial Assistance Corporation during each of the last 

5 years prior to the date the Financial Assistance Corporation 

is obligated to make the repayment, in order to ensure that the 

Financial Assistance Corporation will have the amount of 

funds needed to make the repayment on the due date; and

(ii) reduction or termination in any year when the 

funds paid to the Financial Assistance Corporation, including 

any anticipated future earnings on the funds, are sufficient to 

make the repayment on the due date.

(C) INVESTMENT OF FUNDS. The Financial Assistance 

Corporation shall invest funds derived from the investment in 

eligible investments as defined in section 6.25(a)(1). The funds and 

the earnings on the funds shall be available only for the repayment to 

the Secretary of the Treasury provided for in subparagraph (A).

(D) PASS THROUGH. A bank may (and, to the extent 

necessary to satisfy its obligations, shall) pass on (either directly, or 

indirectly through loan pricing or otherwise) all or part of the 

assessments to its affiliated direct lender associations based on 

proportionate average accruing retail loan volumes for the preceding 

year, but the bank shall remain primarily liable for the amounts.

(E) LIABILITY.

(i) BANKS TERMINATING SYSTEM STATUS OR 

IN LIQUIDATION. Any bank terminating System status 

pursuant to section 7.10 shall be required, under regulations of 

the Farm Credit Administration, to pay to the Financial 

Assistance Corporation the estimated present value of all 

future such assessments against the bank had the bank 

remained in the System. A liability to the Financial Assistance 

Corporation in this amount (calculated as if the bank had left 

the System on the date the bank was placed in liquidation) 

shall be recognized as a claim in favor of the Financial 

Assistance Corporation against the estate of any bank 

undergoing liquidation.

(ii) NO ANTICIPATORY REDUCTIONS IN 

OTHER OBLIGATIONS. The obligations of other banks 

shall not be reduced in anticipation of any recoveries under 

this subparagraph from banks leaving the System or in 

liquidation.

(iii) REFUND OF RECOVERIES. The Financial 

Assistance Corporation shall apply the recoveries, when 

received, and all earnings on the recoveries, to reduce the other 

banks' payment obligations, or, to the extent the recoveries are 

received after the other banks have met their entire payment 

obligation, shall refund the recoveries, when received, to the 

other banks in proportion to the other banks' payments.
(F) ASSOCIATIONS TERMINATING SYSTEM STATUS 

OR IN LIQUIDATION. Any association terminating System status 

pursuant to section 7.10 shall be required, under regulations of the 

Farm Credit Administration, to pay to its supervising bank a share, 

based on the association's retail loan volume relative to the retail loan 

volume of the bank and its affiliated associations had the association 

remained in the System, of the estimated present value of all future 

such assessments against the bank. A liability to the bank in this 

amount (calculated as if the association had left the System on the 

date it was placed in liquidation) shall be recognized as a claim in 

favor of the bank against the estate of any association undergoing 

liquidation.

(G) CAPITAL REQUIREMENTS.

(i) IN GENERAL. Until the date that is 5 years prior 

to the date on which the Financial Assistance Corporation is 

required to repay the Secretary of the Treasury pursuant to 

subparagraph (A), all assessments paid by banks to the 

Financial Assistance Corporation pursuant to subparagraph (B), 

and any part of the obligation to pay future assessments to the 

Financial Assistance Corporation under subparagraph (B) that 

is recognized as an expense on the books of any System bank 

or association, shall nonetheless be included in the capital of 

the bank or association for purposes of determining its 

compliance with regulatory capital requirements.

(ii) DURING THE FINAL 5 YEARS PRIOR TO 

REPAYMENT. During the—

(I) period beginning 5 years, and ending 4 years, 

prior to the date on which the Financial Assistance 

Corporation is required to repay the Secretary of the 

Treasury pursuant to subparagraph (A), 60 percent;

(II) period beginning 4 years, and ending 3 years, 

prior to the date on which the Financial Assistance 

Corporation is required to repay the Secretary of the 

Treasury pursuant to subparagraph (A), 30 percent; and

(III) period beginning 3 years prior to the date on 

which the Financial Assistance Corporation is required 

to repay the Secretary of the Treasury pursuant to 

subparagraph (A), 0 percent,

of all assessments paid by banks to the Financial 

Assistance Corporation pursuant to subparagraph (B), 

and of any part of the obligation to pay future 

assessments to the Financial Assistance Corporation 

under subparagraph (B) that is recognized as an expense 

on the books of any System bank or association, shall 

nonetheless be included in the capital of the bank or 

association for purposes of determining its compliance 

with regulatory capital requirements.

(d) REFINANCING AND PAYMENT OF PRINCIPAL; DEFAULTS.

(1) IN GENERAL.
(A) TIME OF REPAYMENT. On maturity of an obligation 

issued under subsection (a) of this section, the obligation shall be 

repaid by the Financial Assistance Corporation.

(B) PAYMENTS BY INSTITUTIONS.

(i) IN GENERAL. Except as provided in 

subparagraph (C), in order to enable the Financial Assistance 

Corporation to repay the obligation referred to in subparagraph 

(A), each institution that issued preferred stock under section 

6.27(a) with respect to the obligation (or the successor to the 

institution) shall pay to the Financial Assistance Corporation, 

before the maturity date of the obligation, an amount equal to 

the par value of the stock outstanding for the institution.

(ii) ANNUAL APPROPRIATION. Except as 

provided in clause (iii), each year beginning in 1992, as soon 

as practicable following the end of the prior year, each such 

institution (except institutions in receivership and institutions 

that have previously redeemed their preferred stock) shall 

appropriate from its earnings in the prior year to an 

appropriated unallocated surplus account with respect to 

preferred stock, the sum of—

(I) the greater of—

(aa) such amount as the institution may be 

required to appropriate under any assistance 

agreement the institution has with the Farm Credit 

System Assistance Board or the Farm Credit 

System Insurance Corporation; or

(bb) the amount that, if appropriated to the 

account in equal amounts in each year thereafter 

until the maturity of the obligation referred to in 

subparagraph (A), would cause the amount in the 

account to equal the par value of the preferred 

stock issued by the institution with respect to the 

obligation; plus

(II) any amount that had been appropriated to 

the account in a previous year but had thereafter been 

offset by losses.

(iii) LIMITATION. An annual appropriation shall not 

be made to the extent that the appropriation would exceed the 

institution's net income (as determined pursuant to generally 

accepted accounting principles) in that year or to the extent 

that the appropriation would cause the institution's preferred 

stock to be impaired.

(iv) USE. The amount in the appropriated unallocated 

surplus account shall be unavailable to pay dividends or other 

allocations or distributions to shareholders or holders of 

participation certificates. The account shall be senior to all 

other unallocated surplus accounts but junior to all preferred 

and common stock for purposes of the application of operating 

losses.

(v) PREFERRED STOCK. The appropriations of 

surplus by an institution shall not affect the treatment of its 
preferred stock (and of the appropriated unallocated surplus) as 

equity for purposes of regulatory permanent capital 

requirements.

(C) SYSTEMWIDE REPAYMENT.

(i) IN GENERAL. In order to enable the Financial 

Assistance Corporation to repay the obligations issued to 

provide assistance under subsections (c) and (e) of section 410 

of the Agricultural Credit Act of 1987 (12 U.S.C. 2011 note) 

and section 4.9A(c) of this Act, or issued to provide funds to 

cover the expenses of the Assistance Board or the Financial 

Assistance Corporation under sections 6.7(a) and 6.24, 

respectively, of this Act, each System bank shall pay to the 

Financial Assistance Corporation a proportion, as calculated 

by the Financial Assistance Corporation, of the obligation 

equal to—

(I) the average accruing retail loan volume of 

the bank and its affiliated associations for the preceding 

15 years; divided by 

(II) the average accruing retail loan volume of 

all such banks and their affiliated associations for the 

same period.

(ii) EXPENSE ITEM. The annual increase in the 

present value of the estimated obligation of each bank to the 

Financial Assistance Corporation under this subparagraph shall 

be recorded each year as an expense item, in accordance with 

generally accepted accounting principles, on the books of the 

bank.

(iii) PASS THROUGH. A bank may (and, to the 

extent necessary to satisfy it obligations, shall) pass on (either 

directly, or indirectly through loan pricing or otherwise) all or 

part of the amount necessary to satisfy the payment 

requirement to its affiliated direct lender associations based on 

proportionate average accruing retail loan volumes for the 

preceding 15 years, except that the bank shall remain primarily 

liable for the amount.

(iv) BANKS LEAVING SYSTEM. Any bank leaving 

the Farm Credit System pursuant to section 7.10 shall be 

required, under regulations of the Farm Credit Administration, 

to pay to the Financial Assistance Corporation the estimated 

present value of the payment required under this subparagraph 

had the bank remained in the System. A liability to the 

Financial Assistance Corporation in this amount (calculated as 

if the bank had left the System on the date it was placed in 

liquidation) shall be recognized as a claim in favor of the 

Financial Assistance Corporation against the estate of any 

bank undergoing liquidation. The obligations of other banks 

shall not be reduced in anticipation of any such recoveries 

from banks leaving the System or in liquidation, but the 

Financial Assistance Corporation shall apply the recoveries, 

when received, and all earnings on the recoveries, to reduce 

the other banks payment obligations, or, to the extent the 
recoveries are received after the other banks have met their 

entire payment obligation, shall refund the recoveries, when 

received, to the other banks in proportion to the other banks' 

payments.

(v) ASSOCIATIONS TERMINATING SYSTEM 

STATUS OR IN LIQUIDATION. Any association leaving the 

Farm Credit System pursuant to section 7.10 shall be required, 

under regulations of the Farm Credit Administration, to pay to 

its supervising bank a share, based on the association's retail 

loan volume relative to the retail loan volume of the bank and 

its affiliated associations had the association remained in the 

System, of the present value of the future payment obligation 

of its supervising bank. A liability to the bank in this amount 

(calculated as if the association had left the System on the date 

it was placed in liquidation) shall be recognized as a claim in 

favor of the bank against the estate of any association 

undergoing liquidation.

(D) FUNDS FOR PAYMENTS. Payments under 

subparagraphs (B) and (C) shall be made by each such institution 

from the funds of the institution or from funds raised by the 

institution through the issuance of debt obligations, which may be 

issued without a collateral requirement and without any guarantee by 

the Secretary of the Treasury.

(2) REFINANCED OBLIGATIONS. The refinanced obligations 

issued under paragraph (1) shall be solely the obligations of the institutions 

refinancing such, and sections 4.3 and 4.4 shall not apply to such 

obligations.

(3) DEFAULTS.

(A) CERTAIN PRINCIPAL AND INTEREST 

OBLIGATIONS.

(i) PAYMENT BY CORPORATION. If a System 

bank defaults on the payment of interest due under subsection 

(c) of this section during the first 15 years after an obligation is 

issued under subsection (a) on the payment of principal or 

interest due under subparagraphs (B) and (C) of section 

6.9(e)(3), on the payment of principal due under paragraph 

(1)(C), or on the payment of an assessment due under 

subsection (c)(5)(B), of this section, the Financial Assistance 

Corporation shall pay the amount due by the System bank out 

of the Trust Fund, and shall recover the amount due from the 

defaulting System bank, and such amount shall be paid to the 

Trust Fund.

(ii) PAYMENT BY INSURANCE FUND. If the 

Financial Assistance Corporation has not recovered the full 

amount due from a defaulting bank by the end of the 12-month 

period beginning on the date of default, any uncollected 

amount shall be paid to the Trust Fund from the Insurance 

Fund established under section 5.60, to the full extent of funds 

available in the Insurance Fund as of the date the Financial 

Assistance Corporation notified the Farm Credit System 

Insurance Corporation of amounts due under this section.
(iii) PAYMENT BY REMAINING INSTITUTIONS. 

To the extent that the payment from the Insurance Fund is 

insufficient to reimburse the Trust Fund, the remaining balance 

shall be allocated to other System banks in accordance with the 

allocation mechanism applicable under this Act to the 

particular defaulted obligation.

(B) PRINCIPAL OF BONDS ISSUED TO FUND 

PURCHASE OF PREFERRED STOCK.

(i) EVALUATION. Not later than 90 days before the 

maturity of any obligation issued under subsection (a) of this 

section, the Farm Credit Administration shall complete an 

evaluation of the general financial condition of each System 

institution that issued preferred stock under section 6.27(a) 

with respect to such obligation to determine whether such 

System institution will be able to redeem such stock at par 

value on the maturity of the obligation, and remain a viable 

institution capable of providing credit to eligible borrowers at 

equitable and competitive interest rates.

(ii) AVAILABILITY OF EVALUATION. A copy of 

the evaluation required under clause (i) shall be furnished to 

the Secretary of the Treasury and the appropriate committees 

of Congress.

(iii) REDEMPTION BY INSTITUTION; PURCHASE 

BY SECRETARY OF THE TREASURY. If the Farm Credit 

Administration determines, in consultation with the Secretary 

of the Treasury, on the basis of the evaluation required under 

clause (i), that the redemption of such stock at par value would 

impair the other stock or equities of such institution or render 

such institution incapable of meeting its capital adequacy 

standards, the institution shall be prohibited from redeeming

the preferred stock it issued under section 6.27 with respect to 

the maturing obligation. If the Farm Credit Administration 

determines, in consultation with the Secretary of the Treasury, 

on the basis of the evaluation required under clause (i), that 

such institution will be able to redeem, in a timely manner and 

at par value, the preferred stock it issued under section 6.27

with respect to the maturing obligation, and remain a viable 

and competitive institution, such institution shall have the 

option of redeeming or not redeeming such stock. If such 

institution is prohibited from redeeming or elects not to redeem 

such stock, the Financial Assistance Corporation shall 

withdraw funds from the Trust Fund in an amount equal to the 

par value of the preferred stock issued by such institution 

under section 6.27 so as to enable the Financial Assistance 

Corporation to pay the principal of the maturing obligation. 

Simultaneously with such withdrawal of funds from the Trust 

Fund, the Financial Assistance Corporation shall transfer to the 

Insurance Fund an equal amount, at par value, of preferred 

stock of such institution. To the extent that the Trust Fund is 

insufficient to enable the Financial Assistance Corporation to 

pay the full principal of the maturing obligation, the Insurance 
Fund shall be used by the Farm Credit System Insurance 

Corporation to purchase, at par value, the preferred stock 

issued by such institution under section 6.27(a) to enable the 

Financial Assistance Corporation to pay the principal of the 

maturing obligation. To the extent that the Insurance Fund is 

insufficient to enable the Financial Assistance Corporation to 

pay the full principal of the maturing obligation, the Secretary

of the Treasury shall purchase, at par value, the remaining 

quantity of the preferred stock issued by such institution to 

enable the Financial Assistance Corporation to make such full 

payment. For that purpose, the Secretary of Treasury may use, 

as a public debt transaction, the proceeds from the sale of any 

securities issued under chapter 31 of Title 31, United States 

Code. The purposes for which such securities may be issued 

under such chapter are extended to include such purchases of 

stock. Any preferred stock transferred to, or purchased by the 

Farm Credit System Insurance Corporation under this clause 

shall be retired by the issuing institution at such times and 

under such terms and conditions as are agreed to between the 

Insurance Corporation and such institution.

(C) RECOURSE BY OTHER SYSTEM BANKS. A 

defaulting bank shall be liable to the remaining System banks for any 

amount paid by the remaining banks under this paragraph.

(4) PAYMENT BY UNITED STATES.

(A) INABILITY TO PAY. Notwithstanding any other 

provision of this Act, if the Financial Assistance Corporation is 

unable to pay the principal or interest of any obligation issued under 

subsection (a) or section 6.9(e)(3)(A) of this section, the Secretary of 

the Treasury shall pay to the Financial Assistance Corporation the 

amount due which shall be used by the Financial Assistance 

Corporation to pay the obligation.

(B) RECOVERY.

(i) CERTAIN PRINCIPAL AND INTEREST 

OBLIGATIONS. In each instance in which the Secretary of 

the Treasury is required to make a payment under 

subparagraph (A) to the Financial Assistance Corporation as a 

result of a default made by a System bank on interest due from 

such System bank under subsection (c) on the payment of 

principal or interest due under subparagraphs (B) and (C) of 

section 6.9(e)(3), on the payment of principal due under 

paragraph (1)(C), or on the payment of an assessment due 

under subsection (c)(5)(B), of this section, the Secretary of the 

Treasury shall recover the amount of the payments the 

Secretary made, with respect to each defaulting bank, from 

such defaulting bank. If the Secretary has not recovered the 

full amount due from the defaulting bank by the end of the 12-

month period beginning on the date of payment by the 

Secretary, the uncollected amount shall be paid to the 

Secretary from the Insurance Fund established under section 

5.60.
(ii) PRINCIPAL OF BONDS ISSUED TO FUND 

PURCHASE OF PREFERRED STOCK. In each instance in 

which the Secretary of the Treasury is required under 

paragraph (3)(B)(iii) to purchase preferred stock issued by a 

System institution under section 6.27(a), the Farm Credit 

System Insurance Corporation shall use funds deposited in the 

Insurance Fund to repurchase, at par value, from the Secretary 

of the Treasury such stock required to be purchased under 

paragraph (3)(B)(iii) as funds become available for such 

repurchase. 

(iii) PRIORITY. Notwithstanding any other provision 

of this Act except for section 5.60(c)(2)(B), during any year in 

which payments are due to the Secretary of the Treasury from 

the Insurance Fund under clause (i), or preferred stock held by 

the Secretary is due to be repurchased by the Insurance Fund 

under clause (ii), the funds in such Fund, and all funds 

deposited in such Fund during such year, shall be used first for 

the purposes specified in clauses (i) and (ii).

(e) ADMINISTRATION.

(1) DEFINITION OF RETAIL LOAN VOLUME. As used in this 

section, the term "retail loan volume" means all loans (as defined in 

accordance with generally accepted accounting principles) by a System 

bank or association, excluding loans by such a bank or association to 

another System institution.

(2) CALCULATION OF AVERAGE ANNUAL LOAN 

VOLUMES. For purposes of this section and section 6.9, average annual 

loan volumes shall be calculated using month-end balances.

(3) EXCLUSION OF BANKS UNDERGOING LIQUIDATION. 

For purposes of this section and section 6.9, the term "bank" shall not 

include a bank that had entered liquidation prior to the date of enactment of 

this subsection.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-7

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-7 SEC. 6.27. PREFERRED STOCK.

(a) ISSUANCE.

(1) IN GENERAL. Each System institution that is certified under 

section 6.4 may issue a special class of preferred stock only in an amount, 

and subject to such terms and conditions, as authorized by the Assistance 

Board.

(2) DIVIDENDS.

(A) IN GENERAL. Except as provided in subparagraph (B), 

dividends shall not be payable on stock issued under this section.

(B) EXCEPTION. Stock issued under this section shall be 

issued under such terms and conditions as to enable the Secretary of 

the Treasury, with respect to any of such stock the Secretary 

purchases under section 6.26(d)(3)(B)(iii), and the Farm Credit 

System Insurance Corporation, with respect to any of such stock that 

the Insurance Corporation purchases or otherwise acquires under 

section 6.26(d)(3)(B)(iii) or section 6.26(d)(4)(B) (ii), to establish for 

such stock a stated dividend rate equal to the current market yield on 

outstanding, marketable obligations of the United States with

maturities of 30 years, plus a premium to reflect the cost of capital 

for institutions in financial distress.

(3) VOTING RIGHTS. A holder of stock issued under this 

subsection shall have no voting rights with respect to the stock.

(b) PURCHASE. The Financial Assistance Corporation shall purchase 

shares of stock issued by certified System institutions under subsection (a) of this 

section to the extent that the issuance of such stock is approved by the Assistance 

Board.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: Subtitle B-Financial Assistance Corporation

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-8

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-8 SEC. 6.28. PAYMENTS.

(a) IN GENERAL. Beginning in fiscal year 1989, the Secretary of the 

Treasury shall reimburse the Financial Assistance Corporation for any amounts 

such Corporation pays in interest charges under section 6.26(c) during fiscal year 

1988, and thereafter the Secretary shall pay the Financial Assistance Corporation 

any amounts due from the Secretary to such Corporation under section 6.26(c).

(b) AUTHORIZATION OF APPROPRIATIONS. There is authorized 

to be appropriated to the Secretary of the Treasury such sums on an annual basis 

as may be necessary to carry out this subtitle.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-9

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-9 SEC. 6.29. ONE-TIME STOCK PURCHASE.

(a) AMOUNT OF STOCK PURCHASE.

(1) IN GENERAL. Except as provided in paragraphs (2) and (3), 

for the purpose of obtaining funds for the Trust Fund, each System 

institution shall purchase from the Financial Assistance Corporation stock 

issued in accordance with section 6.23 in an amount equal to the amount by 

which the unallocated retained earnings of the institution (after taking into 

account any funds received by the institution under section 6.9(c)) 

exceeds—

(A) in the case of a System bank, 5 percent of assets; or

(B) in the case of a production credit association or a Federal 

land bank association, 13 percent of assets.

(2) REALLOCATION. The district board of a district, subject to 

the unanimous consent of the bank and associations in the district that 

would be affected by the reallocation, may reallocate the amount of stock 

required to be purchased by banks and associations in the district under 

paragraph (1) to equitably reflect the ability of the banks and associations 

to pay, except that—

(A) the total amount of stock purchased by banks and 

associations in the district under this paragraph shall equal the total 

amount of stock required to be purchased by the banks and 

associations under paragraph (1); and

(B) the board may not impair the stock of an association in 

carrying out this paragraph; and

(C) a district board's authority to reallocate stock purchases 

under this paragraph shall be limited to reallocation among like 

associations of the amount of stock required to be purchased by such 

associations; reallocation of the amount of stock required to be 

purchased by production credit associations among such associations 

and the district Federal intermediate credit bank; and reallocation of 

the amount of stock required to be purchased by Federal land bank 

associations among such associations and the district Federal land 

bank. Other reallocations than those enumerated above shall not be 

permitted.

(3) PERIODIC PURCHASES.

(A) Notwithstanding any other provision of this section, the 

Financial Assistance Corporation shall establish a program under 

which System institutions shall purchase, as debt obligations are 
issued under section 6.26(a), stock of the Corporation in amounts 

described in this paragraph.

(B) The program shall provide, with respect to each issuance 

of debt obligations under section 6.26(a), that each System institution 

originally required to purchase stock under paragraph (1), or the 

successor thereto, shall purchase Corporation stock in an amount 

determined by multiplying the amount of stock such institution was 

originally required to purchase under that paragraph by a percentage 

equal to the percentage which the amount of the issuance bears to 

$4,000,000,000.

(C) The Financial Assistance Corporation shall promptly 

rescind purchases of stock of the Corporation made under paragraph 

(1) or (2) by System institutions and refund to such institutions, or 

their successors, the purchase price for the stock, except that, with 

respect to each issuance of debt obligations that occurs before 

October 1, 1988, the Corporation shall deduct from any refund due 

any System institution, and retain, the amount payable by such 

institution. 

(b) COMPUTATIONS. For purposes of subsection (a) of this section, 

the unallocated retained earnings and assets of a System institution shall be 

computed in accordance with generally accepted accounting principles on the 

basis of the financial statement of the institution on December 31, 1986.

(c) NOTICE.

(1) Within 15 days after the retirement of the obligations of the 

Capital Corporation under section 6.9—

(A) the Financial Assistance Corporation shall notify each 

System institution of the amount of stock such institution is required 

to purchase under subsection (a) of this section; or

(B) in the case of a district in which the district board has 

reallocated the stock purchase requirement in accordance with 

subsection (a)(2) of this section, the district board shall notify each 

System institution in the district of the amount of stock such 

institution is required to purchase under subsection (a) of this section.

(2) Not later than 15 days before each issuance of debt obligations 

under section 6.26(a) occurring after September 30, 1988, the Financial 

Assistance Corporation shall notify each System institution required to 

purchase Corporation stock under subsection (a)(3) of this section of the 

amount of the stock it is required to purchase.

(d) INSTITUTION REQUIREMENTS AFTER NOTICE. Within 15 

days after a System institution is notified of the amounts due under subsection (c) 

of this section, the institution shall purchase from the Financial Assistance 

Corporation the amount of stock required to be purchased by the institution under 

this section. No further stock purchases, obligations, or assessments shall be 

required beyond that provided in section 6.26 and this section.

(e) JURISDICTION OVER ACTIONS. Notwithstanding any other 

provision of law, the United States district court for the District of Columbia 

shall have exclusive jurisdiction over any action brought under or arising out of 

this section. No suit or proceeding shall be maintained for the recovery of any 

amount of stock alleged to have been erroneously or illegally purchased, and no 

suit or proceeding shall be maintained to enjoin or otherwise prevent or impede 

the giving of notice or the purchase of stock required under this section, unless 
the amount of stock required to be purchased under this section has been 

purchased and paid for in full.

NOTE: See section 7(b) of Public Law 101-220 for provisions governing 

payment to institutions that paid one-time stock purchase assessments.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-10

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-10 SEC. 6.30. EXEMPTION FROM TAXATION.

(a) ASSETS. The Financial Assistance Corporation, and the capital, 

reserves, and surplus thereof, and the income derived therefrom, shall be exempt 

from Federal, State, municipal, and local taxation, except taxes on real estate held 

by the Financial Assistance Corporation to the same extent, according to its value, 

as other similar property held by other persons is taxed.

(b) OBLIGATIONS. The notes, bonds, debentures, and other 

obligations issued by the Financial Assistance Corporation shall be accorded the 

same tax treatment as Systemwide obligations.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VI Assistance to Farm Credit System

Part: [Part]

Subtitle: Subtitle B-Financial Assistance Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b-11

Date Created: 12/17/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b-11 SEC. 6.31. TERMINATION.

(a) FINANCIAL ASSISTANCE CORPORATION. The Financial 

Assistance Corporation and the authority provided to such Corporation by this 

subtitle shall terminate on the complete discharge by the Financial Assistance 

Corporation of its responsibilities under section 6.9(e) and subsections (c) 

through (g) of section 6.26 with regard to repayments by System institutions, but 

in no event later than 2 years following the maturity and full payment of all debt 

obligations issued under section 6.26(a).

(b) ACCOUNTS. Simultaneously with the termination of the Financial 

Assistance Corporation as provided in subsection (a) of this section, any funds in 

the accounts established under section 6.25 shall be transferred to the Insurance 

Fund established under section 5.60.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle A Merger of Banks Within a District

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279a

Date Created: 12/17/2012

Date Modified: 2/15/2018

TITLE VII—RESTRUCTURING OF SYSTEM INSTITUTIONS

Subtitle A—Merger of Banks Within a District 

12 U.S.C. 2279a SEC. 7.0. POWER TO MERGE.

The banks within a district may merge into a single entity (hereinafter in 

this title referred to as a "merged bank") if the plan of merger is approved by—

(1) the Farm Credit Administration Board;

(2) the respective boards of directors of the banks involved;

(3) a majority of the stockholders of each bank voting, in person 

or by proxy, at a duly authorized stockholders' meeting with each 

association entitled to cast a number of votes equal to the number of its 

voting stockholders; and

(4) in the case of a bank for cooperatives, a majority of the total 

equity interests in such merging bank for cooperatives (including allocated, 

but not unallocated, surplus and reserves) held by those stockholders or 

subscribers to the guaranty fund of the bank voting.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle A Merger of Banks Within a District

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279a-1

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279a-1 SEC. 7.1. BOARD OF DIRECTORS.

Each merged bank shall elect a board of directors of such number, for such 

term, in such manner, and with such qualifications, as may be required in its 

bylaws, except that at least one member shall be elected by the other directors, 

which member shall not be a director, officer, employee, or stockholder of a 

System institution.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle A Merger of Banks Within a District

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279a-2

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279a-2 SEC. 7.2. POWERS OF MERGED BANKS.

(a) IN GENERAL. Except as otherwise provided in this title, a merged 

bank shall have all of the powers granted to, and shall be subject to all of the 

obligations imposed on, any of the constituent entities of the merged bank.

(b) REGULATIONS. The Farm Credit Administration shall issue 

regulations that establish the manner in which the powers and obligations of the 

banks that form the merged bank are consolidated, and to the extent necessary, 

reconciled in the merged bank.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle A Merger of Banks Within a District

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279a-3

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279a-3 SEC. 7.3. CAPITALIZATION.

In accordance with section 4.3A, each merged bank shall provide, through 

bylaws and subject to Farm Credit Administration regulations, for the 

capitalization of the bank and the manner in which bank stock shall be issued, 

held, transferred, and retired and bank earnings distributed.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle B Mergers, Transfers of Assets, and Powers of Associations 

Within a District

Chapter Name: Chapter 1 Transfers by Federal Land Banks to Federal Land Bank 

Associations

U.S. Code Citation 12 U.S.C. 2279b

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle B—Mergers, Transfers of Assets, and Powers of Associations 

Within a District

Chapter 1—Transfers by Federal Land Banks to Federal Land Bank 

Associations

12 U.S.C. 2279b SEC. 7.6. TRANSFER OF LENDING AUTHORITY.

(a) VOLUNTARY TRANSFERS. A Federal land bank or a merged 

bank having a Federal land bank as one of its constituents, may transfer to a 

Federal land bank association, and the association may assume, the authority of 

the transferring bank in the territorial area served by the association, to make and 

participate in long-term real estate mortgage loans under this Act if the transfer is 

approved by—

(1) the Farm Credit Administration Board;

(2) the Board of Directors of both institutions; and

(3) a majority of the stockholders of the bank and of the 

association, in accordance with the voting provisions of sections 7.0 and 

7.8, respectively.

(b) DIRECT LOANS AND FINANCIAL ASSISTANCE. After a 

transfer described in subsection (a) or (d) of this section—

(1) the Federal land bank association shall possess all of the direct 

long-term real estate mortgage loan authority, formerly possessed by the 

transferring bank, in the territory served by the association; and

(2) the bank may provide and extend financial assistance to, and 

discount for, or purchase from, the transferee Federal land bank association 

any note, draft, or other obligation with the endorsement or guarantee of 

the association, the proceeds of which have been advanced to persons 

eligible and for purposes of financing by the association under subsection 

(a) of this section.

(c) REGULATIONS. The Farm Credit Administration shall issue 

regulations that establish the manner in which the powers and obligations of the 

banks that make transfers are consolidated and, to the extent necessary, 

reconciled in the association referred to in subsection (a) of this section.

(d) MANDATORY TRANSFER. On the merger of one or more 

production credit associations with one or more Federal land bank associations, 

the bank supervising the Federal land bank association shall transfer all of the 
direct lending authority of the bank in the territory served by such Federal land 

bank association to such merged association.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle B Mergers, Transfers of Assets, and Powers of Associations 

Within a District

Chapter Name: Chapter 1 Transfers by Federal Land Banks to Federal Land Bank 

Associations

U.S. Code Citation 12 U.S.C. 2279c

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279c SEC. 7.7. EQUALIZATION OF LOAN-MAKING POWERS OF 

CERTAIN DISTRICT ASSOCIATIONS.

(a) EQUALIZATION OF LOAN-MAKING POWERS.—

(1) IN GENERAL.--

(A) FEDERAL LAND BANK ASSOCIATIONS.--Subject 

to paragraph (2), any association that owns a Federal land bank 

association authorized as of January 1, 2007, to make long-term 

loans under title I in its chartered territory within the geographic area 

described in subsection (b) may make short- and intermediate-term 

loans and otherwise operate as a production credit association under 

title II within the same chartered territory.

(B) PRODUCTION CREDIT ASSOCIATIONS.--Subject to 

paragraph (2), any association that under its charter has title I lending 

authority and that owns a production credit association authorized as 

of January 1, 2007, to make short- and intermediate-term loans under 

title II in the geographic area described in subsection (b) may make 

long-term loans and otherwise operate, directly or through a 

subsidiary association, as a Federal land bank association or Federal 

land credit association under title I in the geographic area.

(C) FARM CREDIT BANK.--Notwithstanding section 

5.17(a), the Farm Credit Bank with which any association had a 

written financing agreement as of January 1, 2007, may make loans 

and extend other comparable financial assistance with respect to, and 

may purchase, any loans made under the new authority provided 

under subparagraph (A) and (B) by an association exercising such 

authority.

(2) REQUIRED APPROVALS.--An association may exercise the 

additional authority provided for in paragraph (1) only after the exercise of 

the authority is approved by--

(A) the board of directors of the association; and

(B) a majority of the voting stockholders of the association 

(or, if the association is a subsidiary of another association, the 

voting stockholders of the parent association) voting, in person or by 

proxy, at a duly authorized meeting of stockholders in accordance 

with the process described in section 7.11.

(b) APPLICABILITY.--This section applies only to association the 

chartered territory of which was within the geographic area served by the Federal 
intermediate credit bank immediately prior to its merger with a Farm Credit Bank 

under section 410(e)(1) of the Agricultural Credit Act of 1987 (12 U.S.C. 2011 

note; Public Law 100-233).

NOTE: The amendments made by section 5407 of Public Law 110-246 

became effective on January 1, 2010.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle B Mergers, Transfers of Assets, and Powers of Associations 

Within a District

Chapter Name: Chapter 2 Merger of Like and Unlike Associations

U.S. Code Citation 12 U.S.C. 2279c-1

Date Created: 12/18/2012

Date Modified: 2/15/2018

Chapter 2—Merger of Like and Unlike Associations

12 U.S.C. 2279c-1 SEC. 7.8. MERGER OF ASSOCIATIONS.

(a) IN GENERAL. Two or more associations within the same district, 

whether or not organized under the same title of this Act, may merge into a single 

entity (hereinafter in this title referred to as a "merged association") if the plan of 

merger is approved by—

(1) the Farm Credit Administration Board;

(2) the boards of directors of the associations;

(3) a majority of the shareholders of each association voting, in 

person or by proxy, at a duly authorized stockholders' meeting; and

(4) the Farm Credit Bank.

(b) POWERS, OBLIGATIONS, AND CONSOLIDATION.

(1) POWERS AND OBLIGATIONS. Except as otherwise 

provided by this title, a merged association shall—

(A) possess all powers granted under this Act to the 

associations forming the merged association; and 

(B) be subject to all of the obligations imposed under this 

Act on the associations forming the merged association.

(2) CONSOLIDATION. The Farm Credit Administration shall 

issue regulations that establish the manner in which the powers and 

obligations of the associations that form the merged association are 

consolidated and, to the extent necessary, reconciled in the merged 

association. 

(c) STOCK ISSUANCE.

(1) PLAN OF MERGER. Subject to section 4.3A, the number of 

shares of capital stock issued by a merged association to the stockholders 

of any association forming such merged association, and the rights and 

privileges of such shares (including voting power, preferences on 

liquidation, and the right to dividends), shall be determined by the plan of 

merger adopted by the merged associations.

(2) CAPITALIZATION. In accordance with section 4.3A, each 

merged association shall provide, through bylaws and subject to Farm 

Credit Administration regulations, for the capitalization of the association 

and the manner in which association stock shall be issued, held, transferred, 

and retired, and association earnings shall be distributed.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle B Mergers, Transfers of Assets, and Powers of Associations 

Within a District

Chapter Name: Chapter 3 Reconsideration

U.S. Code Citation 12 U.S.C. 2279c-2

Date Created: 12/18/2012

Date Modified: 2/15/2018

Chapter 3—Reconsideration

12 U.S.C. 2279c-2 SEC. 7.9. RECONSIDERATION.

(a) PERIOD. A stockholder vote in favor of—

(1) the merger of districts under this Act;

(2) the merger of banks within a district under section 7.0;

(3) the transfer of the lending authority of a Federal land bank or a 

merged bank having a Federal land bank as one of its constituents, under 

section 7.6;

(4) the merger of two or more associations under section 7.8 or 

7.13;

(5) the termination of the status of an institution as a System 

institution under section 7.10; or

(6) the merger of similar banks under section 7.12;

shall not take effect except in accordance with subsection (b) of this section.

(b) RECONSIDERATION.

(1) NOTICE. Not later than 30 days after a stockholder vote in 

favor of any of the actions described in subsection (a) of this section, the 

officer or employee that records such vote shall ensure that all stockholders 

of the voting entity receive notice of the final results of the vote.

(2) EFFECTIVE DATE. A voluntary merger, transfer, or 

termination that is approved by a vote of the stockholders of two or more 

banks or associations shall not take effect until the expiration of 30 days 

after the date on which the stockholders of such banks or associations are 

notified of the final result of the vote in accordance with paragraph (1).

(3) PETITION FILED. If a petition for reconsideration of a 

merger, transfer, or termination vote, signed by at least 15 percent of the 

stockholders of one or more of the affected banks or associations, is 

presented to the Farm Credit Administration within 30 days after the date 

of the notification required under paragraph (1)—

(A) a voluntary merger, transfer, or termination shall not 

take effect until the expiration of 60 days after the date on which the 

stockholders were notified of the final result of the vote; and

(B) a special meeting of the stockholders of the affected 

banks or associations shall be held during the period referred to in 

subparagraph (A) to reconsider the vote.

(4) VOTE ON RECONSIDERATION. If a majority of 

stockholders of any one of the affected banks or associations voting, in 
person or by written proxy, at a duly authorized stockholders' meeting, vote 

against the proposed merger, transfer, or termination, such action shall not 

take place.

(5) FAILURE TO FILE PETITION. If a petition for 

reconsideration of such vote is either not filed prior to the 60th day after 

the vote or, if timely filed, is not signed by at least 15 percent of the 

stockholders, the merger, transfer, or termination shall become effective in 

accordance with the plan of merger, transfer, or termination.

(c) SPECIAL RECONSIDERATION.

(1) ISSUANCE OF REGULATIONS. Notwithstanding any other 

provision of this Act, the Farm Credit Administration shall issue 

regulations under which the stockholders of any association that 

voluntarily merged with one or more associations after December 23, 1985, 

and before the date of the enactment of this section, may petition for the 

opportunity to organize as a separate association.

(2) REQUIREMENTS. The regulations issued by the Farm Credit 

Administration shall require that—

(A) the petition be filed within 1 year after the date of the 

implementation of such regulations;

(B) the petition be signed by at least 15 percent of the 

stockholders of any one of the associations that merged during the 

period;

(C) the petition describe the territory in which the proposed 

separate association will operate;

(D) if the petition is approved—

(i) the loans of the members of the new association 

will be transferred from the current association to such new 

association;

(ii) the stock, participation certificates, and other 

similar equities of the current association held by members of 

the new association will be retired at book value and the 

proceeds of such will be transferred to the new association, and 

an equivalent amount of stock, participation certificates, and 

other similar equities will be issued to the members by the new 

association; and

(iii) the other assets of the current association will be 

distributed equitably among the current association and any 

resulting new association.

(3) NOTIFICATION.

(A) IN GENERAL. Not later than 30 days after the filing of 

the petition for organization, the current association shall notify its 

stockholders that a petition to establish the separate association has 

been filed.

(B) CONTENTS. The notification required under this 

paragraph shall contain—

(i) the date of a special stockholders meeting to 

consider the petition for organization; and

(ii) an enumerated statement of the anticipated 

benefits and the potential disadvantages to such stockholders if 

the new association is established.

(C) FCA APPROVAL.
(i) IN GENERAL. All notifications under this 

paragraph shall be submitted to the Farm Credit 

Administration Board for approval prior to being distributed to 

the stockholders.

(ii) AMENDING NOTIFICATION. The Farm Credit 

Administration Board shall require that, prior to the 

distribution of the notification to the stockholders, the 

notification be amended as determined necessary by the Board 

to provide accurate information to the stockholders that will 

enable such stockholders to make an informed decision as to 

the advisability of establishing a new association.

(D) SPECIAL STOCKHOLDERS' MEETING.

(i) TIMING OF MEETING. The special 

stockholders' meeting to consider the petition shall be held 

within 60 days after the filing of the petition.

(ii) APPROVAL. If, at the special stockholders' 

meeting, a majority of the stockholders of the current 

association who would be served by the new association 

approve, by voting in person or by proxy, the establishment of 

the separate association, the Farm Credit Administration shall, 

within 30 days of such vote, issue a charter to the new 

association and amend the charter of the current association to 

reflect the territory to be served by the new association.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle B Mergers, Transfers of Assets, and Powers of Associations 

Within a District

Chapter Name: Chapter 4 Termination and Dissolution of Institutions

U.S. Code Citation 12 U.S.C. 2279d

Date Created: 12/18/2012

Date Modified: 2/15/2018

Chapter 4—Termination and Dissolution of Institutions

12 U.S.C. 2279d SEC. 7.10. TERMINATION OF SYSTEM INSTITUTION STATUS.

(a) CONDITIONS. A System institution may terminate the status of the 

institution as a System institution if—

(1) the institution provides written notice to the Farm Credit 

Administration Board not later than 90 days prior to the proposed 

termination date;

(2) the termination is approved by the Farm Credit Administration 

Board;

(3) the appropriate Federal or State authority grants approval to 

charter the institution as a bank, savings and loan association, or other 

financial institution;

(4) the institution pays the Farm Credit Assistance Fund, as 

created under section 6.25, if the termination is prior to January 1, 1992, or 

pays to the Farm Credit Insurance Fund, if the termination is after such 

date, the amount by which the total capital of the institution exceeds, 6 

percent of the assets;

(5) the institution pays or makes adequate provision for payment 

of all outstanding debt obligations of the institution;

(6) the termination is approved by a majority of the stockholders 

of the institution voting, in person or by written proxy, at a duly authorized 

stockholders' meeting, held prior to giving notice to the Farm Credit 

Administration Board; and

(7) the institution meets such other conditions as the Farm Credit 

Administration Board by regulation considers appropriate.

(b) EFFECT. On termination of its status as a System institution--

(1) the Farm Credit Administration Board shall revoke the charter 

of the institution; and

(2) the institution shall no longer be an instrumentality of the 

United States under this Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle C Approval of Disclosure Information and Issuance of Charters by 

the Farm Credit Administration Board

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279e

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle C—Approval of Disclosure Information and Issuance of Charters 

by the Farm Credit Administration Board

12 U.S.C. 2279e SEC. 7.11. APPROVAL OF DISCLOSURE INFORMATION AND 

ISSUANCE OF CHARTERS.

(a) DISCLOSURE OF INFORMATION.

(1) APPROVAL OF PLAN. With respect to any plan of merger, 

transfer of lending authority, dissolution, or termination, prior to 

submission to the voters (voting stockholders and, where required, 

contributors to guaranty funds) of the institutions involved, such plan shall 

be submitted to the Farm Credit Administration Board, together with all 

information that is to be distributed to the voters with respect to the 

contemplated action, including an enumerated statement of the anticipated 

benefits and potential disadvantages of such action. 

(2) NOTICE OF APPROVAL. On notification that the Farm 

Credit Administration Board has approved such plan for submission to the 

stockholders, or after 60 days of no action on the plan by the Board, the 

submitting institutions may submit the plan, together with the disclosure 

information, to the voters for the prescribed vote.

(b) NOTICE OF REASONS FOR DISAPPROVAL. If the Farm Credit 

Administration Board disapproves the plan for submission to the stockholders, 

notification to the submitting institutions shall specify the reasons for the 

determination by the Board. If such plan is determined to be inadequate, it shall 

not be submitted to the voters for a vote.

(c) FEDERAL CHARTER. Each plan of merger or transfer of lending 

authority may include a proposed new or revised Federal charter for the merged 

or transferee entity. The Farm Credit Administration Board shall issue such 

charter on the approval of the plan, as prescribed in this title, unless the Board 

determines that the charter submitted is not consistent with this Act.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle D Mergers of Like Entities

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279f

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle D—Mergers of Like Entities

12 U.S.C. 2279f SEC. 7.12. MERGER OF SIMILAR BANKS.

(a) IN GENERAL. Banks organized or operating under this Act may 

merge with banks in other districts operating under the same title if the plan of 

merger is approved by—

(1) the Farm Credit Administration Board;

(2) the respective Boards of Directors of the banks involved;

(3) a majority vote of the stockholders of each bank voting, in 

person or by proxy, at a duly authorized stockholders' meeting, with each 

association having a number of votes equal to the number of such 

association's voting stockholders; and

(4) in the case of a bank for cooperatives, a majority of the total 

equity interests in such merging bank for cooperatives (including allocated, 

but not unallocated, surplus and reserves) held by those stockholders or 

subscribers to the guaranty fund of the bank voting.

(b) POWERS AND CAPITALIZATION. Sections 7.2 and 7.3 shall 

apply to banks merged under this section.

(c) BOARD OF DIRECTORS.

(1) IN GENERAL. After a merger under subsection (a) of this 

section, a board of directors shall be created for the resulting bank.

(2) COMPOSITION. The board shall be composed of—

(A) two directors elected by each of the bank boards, with at 

least one such director from each bank being elected by the eligible 

stockholders of, or subscribers to, the guaranty fund of the merging 

banks; and

(B) one outside director elected by the directors elected 

under subparagraph (A).

(3) OUTSIDE DIRECTOR.

(A) QUALIFICATIONS. The outside director elected under 

paragraph (2)(B) shall be experienced in financial services and credit, 

and within the 2-year period prior to such election, shall not have 

been a borrower from, shareholder in, or director, officer, employee, 

or agent of any institution of the Farm Credit System.

(B) FAILURE TO ELECT. If the other members of the 

board fail to elect an outside director, the Farm Credit 

Administration Board shall appoint a qualified person to serve on the 

board of directors until such member is so elected.
(4) BYLAWS. Notwithstanding paragraph (2), the bylaws of the 

merged bank may, with the approval of the Farm Credit Administration, 

provide for a different number of directors to be selected in a different 

manner, except that the bylaws shall provide for at least one outside 

director.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle D Mergers of Like Entities

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279f-1

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279f-1 SEC. 7.13. MERGER OF SIMILAR ASSOCIATIONS.

(a) IN GENERAL. Associations may voluntarily merge with other like 

associations if the plan of merger is approved by—

(1) the Farm Credit Administration Board;

(2) the respective Boards of Directors of the associations involved;

(3) a majority vote of the stockholders of each association voting, 

in person or by proxy, at a duly authorized stockholders' meeting; and

(4) the Farm Credit Banks involved.

(b) PROCEDURES. The provisions of subsections (b) and (c) of section 

7.8 shall apply to associations merged under this section.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VII Restructuring of System Institutions

Part: [Part]

Subtitle: Subtitle E Taxation of Merger Transactions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279g

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle E—Taxation of Merger Transactions

12 U.S.C. 2279g SEC. 7.14. TRANSACTIONS TO ACCOMPLISH MERGERS 

EXEMPT FROM CERTAIN STATE TAXES.

No State or political subdivision thereof may treat the merger or 

consolidation of two or more institutions of the Farm Credit System under this 

title or title IV of the Agricultural Credit Act of 1987 as resulting in a change of 

ownership of any property owned by any of such merging or consolidating 

institutions, for purposes of any law of such State or political subdivision 

providing for reassessment of property on the occurrence of a change of 

ownership or imposing a tax on the ownership or transfer of property.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa

Date Created: 12/18/2012

Date Modified: 2/15/2018

TITLE VIII—AGRICULTURAL MORTGAGE SECONDARY MARKET

12 U.S.C. 2279aa SEC. 8.0. DEFINITIONS.

For purposes of this title:

(1) AGRICULTURAL REAL ESTATE. The term "agricultural 

real estate" means—

(A) a parcel or parcels of land, or a building or structure 

affixed to the parcel or parcels, that—

(i) is used for the production of one or more 

agricultural commodities or products; and

(ii) consists of a minimum acreage or is used in 

producing minimum annual receipts, as determined by the 

Corporation; or

(B) a principal residence that is a single family, moderatepriced residential dwelling located in a rural area, excluding—

(i) any community having a population in excess of 

2,500 inhabitants; and

(ii) any dwelling, excluding the land to which the 

dwelling is affixed, with a value exceeding $100,000 (as 

adjusted for inflation.)

(2) BOARD. The term "Board" means—

(A) the interim board of directors established in section 

8.2(a); and

(B) the permanent board of directors established in section 

8.2(b); as the case may be.

(3) CERTIFIED FACILITY. The term "certified facility" means:

(A) an agricultural mortgage marketing facility that is 

certified under section 8.5; or

(B) the Corporation and any affiliate thereof.

(4) CORPORATION. The term "Corporation" means the Federal 

Agricultural Mortgage Corporation established in section 8.1.

(5) GUARANTEE. The term "guarantee" means the guarantee of 

timely payment of the principal and interest on securities representing 

interests in, or obligations backed by, pools of qualified loans, in 

accordance with this title.

(6) INTERIM BOARD. The term "interim board" means the 

interim board of directors established in section 8.2(a).

(7) ORIGINATOR. The term "originator" means any Farm Credit 

System institution, bank, insurance company, business and industrial 
development company, savings and loan association, association of 

agricultural producers, agricultural cooperative, commercial finance 

company, trust company, credit union, or other entity that originates and 

services agricultural mortgage loans.

(8) PERMANENT BOARD. The term "permanent board" means 

the permanent board of directors established in section 8.2(b).

(9) QUALIFIED LOAN. The term "qualified loan" means an 

obligation—

(A)(i) that is secured by a fee-simple or leasehold mortgage 

with status as a first lien on agricultural real estate located in the 

United States that is not subject to any legal or equitable claims 

deriving from a preceding fee-simple or leasehold mortgage;

(ii) of—

(I) a citizen or national of the United States or 

an alien lawfully admitted for permanent residence in the 

United States; or

(II) a private corporation or partnership whose 

members, stockholders, or partners holding a majority 

interest in the corporation or partnership are individuals 

described in subclause (I); and

(iii) of a person, corporation, or partnership that has 

training or farming experience that, under criteria established 

by the Corporation, is sufficient to ensure a reasonable 

likelihood that the loan will be repaid according to its terms; 

(B) that is the portion of a loan guaranteed by the Secretary 

of Agriculture pursuant to the Consolidated Farm and Rural 

Development Act (7 U.S.C. 1921 et seq.), except that—

(i) subsections (b) through (d) of section 8.6, and 

sections 8.8 and 8.9, shall not apply to the portion of a loan 

guaranteed by the Secretary or to an obligation, pool, or 

security representing an interest in or obligation backed by a 

pool of obligations relating to the portion of a loan guaranteed 

by the Secretary; and

(ii) the portion of a loan guaranteed by the Secretary 

shall be considered to meet all standards for qualified loans for 

all purposes under this Act; or

(C) that is a loan, or an interest in a loan, for an electric or 

telephone facility by a cooperative lender to a borrower that has 

received, or is eligible to receive, a loan under the Rural 

Electrification Act of 1936 (7 U.S.C. 901 et seq.).

(10) STATE. The term "State" has the meaning given such term in 

section 5.51.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-1

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle A—Establishment and Activities of Federal Agricultural Mortgage 

Corporation

12 U.S.C. 2279aa-1 SEC. 8.1. FEDERAL AGRICULTURAL MORTGAGE 

CORPORATION.

(a) ESTABLISHMENT.

(1) IN GENERAL. There is hereby established a corporation to 

be known as the Federal Agricultural Mortgage Corporation, which shall 

be a federally chartered instrumentality of the United States.

(2) INSTITUTION WITHIN FARM CREDIT SYSTEM. The 

Corporation shall be an institution of the Farm Credit System.

(3) LIABILITY.

(A) CORPORATION. The Corporation shall not be liable 

for any debt or obligation of any other institution of the Farm Credit 

System.

(B) SYSTEM INSTITUTIONS. The Farm Credit System 

and System institutions (other than the Corporation) shall not be 

liable for any debt or obligation of the Corporation.

(b) DUTIES. The Corporation shall—

(1) in consultation with originators, develop uniform underwriting, 

security appraisal, and repayment standards for qualified loans;

(2) determine the eligibility of agricultural mortgage marketing 

facilities to contract with the Corporation for the provision of guarantees 

for specific mortgage pools; 

(3) provide guarantees for the timely repayment of principal and 

interest on securities representing interests in, or obligations backed by, 

pools of qualified loans; and

(4) purchase qualified loans and issue securities representing 

interests in, or obligations backed by, the qualified loans, guaranteed for 

timely repayment of principal and interest.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-2

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-2 SEC. 8.2. BOARD OF DIRECTORS.

(a) INTERIM BOARD.

(1) NUMBER AND APPOINTMENT. Until the permanent board 

of directors established in subsection (b) of this section first meets with a 

quorum of its members present, the Corporation shall be under the 

management of an interim board of directors composed of 9 members 

appointed by the President within 90 days after the date of the enactment of 

this title as follows:

(A) 3 members appointed from among persons who are 

representatives of banks, other financial institutions or entities, and 

insurance companies.

(B) 3 members appointed from among persons who are 

representatives of the Farm Credit System institutions.

(C) 2 members appointed from among persons who are 

farmers or ranchers who are not serving, and have not served, as 

directors or officers of any financial institution or entity, of which 

not more than 1 may be a stockholder of any Farm Credit System 

institution.

(D) 1 member appointed from among persons who represent 

the interests of the general public and are not serving, and have not 

served, as directors or officers of any financial institution or entity.

(2) POLITICAL AFFILIATION. Not more than 5 members of 

the interim board shall be of the same political party.

(3) VACANCY. A vacancy in the interim board shall be filled in 

the manner in which the original appointment was made.

(4) CONTINUATION OF MEMBERSHIP. If—

(A) any member of the interim board who was appointed to 

such board from among persons who are representatives of banks, 

other financial institutions or entities, insurance companies, or Farm 

Credit System institutions ceases to be such a representative; or

(B) any member who was appointed from among persons 

who are not or have not been directors or officers of any financial 

institution or entity becomes a director or an officer of any financial 

institution or entity;

such member may continue as a member for not longer than the 45-day 

period beginning on the date such member ceases to be such a 

representative or becomes such a director or officer, as the case may be.
(5) TERMS. The members of the interim board shall be appointed 

for the life of such board.

(6) QUORUM. 5 members of the interim board shall constitute a 

quorum.

(7) CHAIRPERSON. The President shall designate 1 of the 

members of the interim board as the chairperson of the interim board.

(8) MEETINGS. The interim board shall meet at the call of the 

chairperson or a majority of its members.

(9) VOTING COMMON STOCK.

(A) INITIAL OFFERING. Upon the appointment of 

sufficient members of the interim board to convene a meeting with a 

quorum present, the interim board shall arrange for an initial offering 

of common stock and shall take whatever other actions are necessary 

to proceed with the operations of the Corporation.

(B) PURCHASERS. Subject to subparagraph (C), the 

voting common stock shall be offered to banks, other financial 

entities, insurance companies, and System institutions under such 

terms and conditions as the interim board may adopt.

(C) DISTRIBUTION. The voting stock shall be fairly and 

broadly offered to ensure that no institution or institutions acquire a 

disproportionate amount of the total amount of voting common stock 

outstanding of a class and that capital contributions and issuances of 

voting common stock for the contributions are fairly distributed 

between entities eligible to hold class A and class B stock, as 

provided under section 8.4.

(10) TERMINATION. The interim board shall terminate when the 

permanent board of directors established in subsection (b) of this section 

first meets with a quorum present.

(b) PERMANENT BOARD.

(1) ESTABLISHMENT. Immediately after the date that banks, 

other financial institutions or entities, insurance companies, and System 

institutions have subscribed and fully paid for at least $20,000,000 of 

common stock of the Corporation, the Corporation shall arrange for the 

election and appointment of a permanent board of directors. After the 

termination of the interim board, the Corporation shall be under the 

management of the permanent board.

(2) COMPOSITION. The permanent board shall consist of 15 

members, of which—

(A) 5 members shall be elected by holders of common stock 

that are insurance companies, banks, or other financial institutions or 

entities;

(B) 5 members shall be elected by holders of common stock 

that are Farm Credit System institutions; and

(C) 5 members shall be appointed by the President, by and 

with the advice and consent of the Senate

(i) which members shall not be, or have been, officers 

or directors of any financial institutions or entities;

(ii) which members shall be representatives of the 

general public;

(iii) of which members not more than 3 shall be 

members of the same political party; and
(iv) of which members at least 2 shall be experienced 

in farming or ranching.

(3) PRESIDENTIAL APPOINTEES. The President shall appoint 

the members of the permanent board referred to in paragraph (2)(C) not 

later than the later of—

(A) the date referred to in paragraph (1); or

(B) the expiration of the 270-day period beginning on the 

date of the enactment of this title.

(4) VACANCY.

(A) ELECTED MEMBERS. Subject to paragraph (6), a 

vacancy among the members elected to the permanent board in the 

manner described in subparagraph (A) or (B) of paragraph (2) shall 

be filled by the permanent board from among persons eligible for 

election to the position for which the vacancy exists.

(B) APPOINTED MEMBERS. A vacancy among the 

members appointed to the permanent board under paragraph (2)(C) 

shall be filled in the manner in which the original appointment was 

made.

(5) CONTINUATION OF MEMBERSHIP. If—

(A) any member of the permanent board who was appointed 

or elected to the permanent board from among persons who are 

representatives of banks, other financial institutions or entities, 

insurance companies, or Farm Credit System institutions ceases to be 

such a representative; or

(B) any member who was appointed from persons who are 

not or have not been directors or officers of any financial institution 

or entity becomes a director or an officer of any financial institution 

or entity;

such member may continue as a member for not longer than the 45-day 

period beginning on the date such member ceases to be such a 

representative, officer, or employee or becomes such a director or officer, 

as the case may be.

(6) TERMS.

(A) APPOINTED MEMBERS. The members appointed by 

the President shall serve at the pleasure of the President.

(B) ELECTED MEMBERS. The members elected under 

subparagraphs (A) and (B) of subsection (b)(2) of this section shall 

each be elected annually for a term ending on the date of the next 

annual meeting of the common stockholders of the Corporation and 

shall serve until their successors are elected and qualified. Any seat 

on the permanent board that becomes vacant after the annual election 

of the directors shall be filled by the members of the permanent 

board from the same category of directors, but only for the unexpired 

portion of the term.

(C) VACANCY APPOINTMENT. Any member appointed 

to fill a vacancy occurring before the expiration of the term for 

which the predecessor of the member was appointed shall be 

appointed only for the remainder of such term.

(D) SERVICE AFTER EXPIRATION OF TERM. A 

member may serve after the expiration of the term of the member 

until the successor of the member has taken office.
(7) QUORUM. 8 members of the permanent board shall 

constitute a quorum.

(8) NO ADDITIONAL PAY FOR FEDERAL OFFICERS OR 

EMPLOYEES. Members of the permanent board who are full-time 

officers or employees of the United States shall receive no additional pay 

by reason of service on the permanent board.

(9) CHAIRPERSON. The President shall designate 1 of the 

members of the permanent board who are appointed by the President as the 

chairperson of the permanent board.

(10) MEETINGS. The permanent board shall meet at the call of 

the chairperson or a majority of its members.

(c) OFFICERS AND STAFF. The Board may appoint, employ, fix the 

pay of, and provide other allowances and benefits for such officers and 

employees of the Corporation as the Board determines to be appropriate.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-3

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-3 SEC. 8.3. POWERS AND DUTIES OF CORPORATION AND 

BOARD.

(a) GUARANTEES. After the Board has been duly constituted, subject 

to the other provisions of this title and other commitments and requirements 

established pursuant to law, the Corporation may provide guarantees on terms 

and conditions determined by the Corporation of securities issued on the security 

of, or in participation in, pooled interests in qualified loans.

(b) DUTIES OF THE BOARD.

(1) IN GENERAL. The Board shall—

(A) determine the general policies that shall govern the 

operations of the Corporation;

(B) select, appoint, and determine the compensation of 

qualified persons to fill such offices as may be provided for in the 

bylaws of the Corporation, and

(C) assign to such persons such executive functions, powers, 

and duties as may be prescribed by the bylaws of the Corporation or 

by the Board.

(2) EXECUTIVE OFFICERS AND FUNCTIONS. The persons 

elected or appointed under paragraph (1)(B) shall be the executive officers 

of the Corporation and shall discharge the executive functions, powers, and 

duties of the Corporation.

(c) POWERS OF THE CORPORATION. The Corporation shall be a 

body corporate and shall have the following powers:

(1) To operate under the direction of its Board.

(2) To issue stock in the manner provided in section 8.4.

(3) To adopt, alter, and use a corporate seal, which shall be 

judicially noted.

(4) To provide for a president, 1 or more vice presidents, secretary, 

treasurer, and such other officers, employees, and agents as may be 

necessary, define their duties and compensation levels, all without regard 

to Title 5, United States Code, and require surety bonds or make other 

provisions against losses occasioned by acts of such persons.

(5) To provide guarantees in the manner provided under section 

8.6.

(6) To have succession until dissolved by a law enacted by the 

Congress.

(7) To prescribe bylaws, through the Board, not inconsistent with 

law, that shall provide for—
(A) the classes of the stock of the Corporation; and

(B) the manner in which—

(i) the stock shall be issued, transferred, and retired;

(ii) the officers, employees, and agents of the 

Corporation are selected;

(iii) the property of the Corporation is acquired, held, 

and transferred;

(iv) the commitments and other financial assistance of 

the Corporation are made;

(v) the general business of the Corporation is 

conducted; and

(vi) the privileges granted by law to the Corporation 

are exercised and enjoyed;

(8) To prescribe such standards as may be necessary to carry out 

this title.

(9) To enter into contracts and make payments with respect to the 

contracts.

(10) To sue and be sued in its corporate capacity and to complain 

and defend in any action brought by or against the Corporation in any State 

or Federal court of competent jurisdiction.

(11) To make and perform contracts, agreements, and commitments 

with persons and entities both inside and outside of the Farm Credit 

System.

(12) To acquire, hold, lease, mortgage or dispose of, at public or 

private sale, real and personal property, purchase or sell any securities or 

obligations, and otherwise exercise all the usual incidents of ownership of 

property necessary and convenient to the business of the Corporation.

(13) To purchase, hold, sell or assign a qualified loan, to issue a 

guaranteed security, representing an interest in, or an obligation backed by, 

the qualified loan, and to perform all the functions and responsibilities of 

an agricultural mortgage marketing facility operating as a certified facility 

under this title.

(14) To establish, acquire, and maintain affiliates (as such term is 

defined in section 8.11(e)) under applicable State laws to carry out any 

activities that otherwise would be performed directly by the Corporation 

under this title.

(15) To exercise such other incidental powers as are necessary to 

carry out the powers, duties, and functions of the Corporation in 

accordance with this title.

(d) FEDERAL RESERVE BANKS AS DEPOSITORIES AND FISCAL 

AGENTS. The Federal Reserve banks shall act as depositories for, and as fiscal 

agents or custodians of, the Corporation.

(e) ACCESS TO BOOK-ENTRY SYSTEM. The Corporation shall 

have access to the book-entry system of the Federal Reserve System.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-4

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-4 SEC. 8.4. STOCK ISSUANCE.

(a) VOTING COMMON STOCK.

(1) ISSUE. The Corporation shall issue voting common stock 

having such par value as may be fixed by the Board from time to time. 

Each share of voting common stock shall be entitled to one vote with rights 

of cumulative voting at all elections of directors. Voting shall be by 

classes as described in section 8.2(a)(9). The stock shall be divided into 

two classes with the same par value per share. Class A stock may be held 

only by entities that are not Farm Credit System institutions and that are 

entitled to vote for directors specified in section 8.2(b)(2)(A), including 

national banking associations (which shall be allowed to purchase and hold 

such stock). Class B stock may be held only by Farm Credit System 

institutions that are entitled to vote for directors specified in section 

8.2(b)(2)(B).

(2) LIMITATION ON ISSUE. After the date the permanent board 

first meets with a quorum of its members present, voting common stock of 

the Corporation may be issued only to originators and certified facilities.

(3) AUTHORITY OF BOARD TO ESTABLISH TERMS AND 

PROCEDURES. The Board shall adopt such terms, conditions, and 

procedures with regard to the issue of stock under this section as may be 

necessary, including the establishment of a maximum amount limitation on 

the number of shares of voting common stock that may be outstanding at 

any time.

(4) TRANSFERABILITY. Subject to such limitations as the 

Board may impose, any share of any class of voting common stock issued 

under this section shall be transferable among the institutions or entities to 

which shares of such class of common stock may be offered under 

paragraph (1), except that, as to the Corporation, such shares shall be 

transferable only on the books of the Corporation.

(5) MAXIMUM NUMBER OF SHARES. No stockholder, other 

than a holder of class B stock, may own, directly or indirectly, more than 

33 percent of the outstanding shares of such class of the voting common 

stock of the Corporation.

(b) REQUIRED CAPITAL CONTRIBUTIONS.

(1) IN GENERAL. The Corporation may require each originator 

and each certified facility to make, or commit to make, such nonrefundable 

capital contributions to the Corporation as are reasonable and necessary to 

meet the administrative expenses of the Corporation.
(2) STOCK ISSUED AS CONSIDERATION FOR 

CONTRIBUTION. The Corporation, from time to time, shall issue to each 

originator or certified facility voting common stock evidencing any capital 

contributions made pursuant to this subsection.

(c) DIVIDENDS.

(1) IN GENERAL. Such dividends as may be declared by the 

Board, in the discretion of the Board, shall be paid by the Corporation to 

the holders of the voting common stock of the Corporation pro rata based 

on the total number of shares of both classes of stock outstanding.

(2) RESERVES REQUIREMENT. No dividend may be declared 

or paid by the Board under this section unless the Board determines that 

adequate provision has been made for the reserve required under section 

8.10(c)(1).

(3) DIVIDENDS PROHIBITED WHILE OBLIGATIONS ARE 

OUTSTANDING. No dividend may be declared or paid by the Board 

under this section while any obligation issued by the Corporation to the 

Secretary of the Treasury under section 8.13 remains outstanding.

(d) NONVOTING COMMON STOCK. The Corporation is authorized 

to issue nonvoting common stock having such par value as may be fixed by the 

Board from time to time. Such nonvoting common stock shall be freely 

transferable, except that, as to the Corporation, such stock shall be transferable 

only on the books of the Corporation. Such dividends as may be declared by the 

Board, in the discretion of the Board, may be paid by the Corporation to the 

holders of the nonvoting common stock of the Corporation, subject to paragraphs 

(2) and (3) of subsection (c) of this section.

(e) PREFERRED STOCK.

(1) AUTHORITY OF BOARD. The Corporation is authorized to 

issue nonvoting preferred stock having such par value as may be fixed by 

the Board from time to time. Such preferred stock issued shall be freely 

transferable, except that, as to the Corporation, such stock shall be 

transferred only on the books of the Corporation.

(2) RIGHTS OF PREFERRED STOCK. Subject to paragraphs (2) 

and (3) of subsection (c) of this section, the holders of the preferred stock 

shall be entitled to such rate of cumulative dividends, and such holders 

shall be subject to such redemption or other conversion provisions, as may 

be provided for at the time of issuance. No dividends shall be payable on 

any share of common stock at any time when any dividend is due on any 

share of preferred stock and has not been paid.

(3) PREFERENCE OF TERMINATION OF BUSINESS. In the 

event of any liquidation, dissolution, or winding up of the business of the 

Corporation, the holders of the preferred shares of stock shall be paid in 

full at the par value thereof, plus all accrued dividends, before the holders

of the common shares receive any payment.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-5

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-5 SEC. 8.5. CERTIFICATION OF AGRICULTURAL MORTGAGE 

MARKETING FACILITIES.

(a) ELIGIBILITY STANDARDS.

(1) ESTABLISHMENT REQUIRED. Within 120 days after the 

date on which the permanent board first meets with a quorum present, the 

Corporation shall issue standards for the certification of agricultural 

mortgage marketing facilities (other than the Corporation), including 

eligibility standards in accordance with paragraph (2).

(2) MINIMUM REQUIREMENTS. To be eligible to be certified 

under the standards referred to in paragraph (1), an agricultural mortgage 

marketing facility (other than the Corporation) shall—

(A) be an institution of the Farm Credit System or a 

corporation, association, or trust organized under the laws of the 

United States or of any State;

(B) meet or exceed capital standards established by the 

Board;

(C) have as one of the purposes of the facility, the sale or 

resale of securities representing interests in, or obligations backed by, 

pools of qualified loans that have been provided guarantees by the 

Corporation;

(D) demonstrate managerial ability with respect to 

agricultural mortgage loan underwriting, servicing, and marketing 

that is acceptable to the Corporation;

(E) adopt appropriate agricultural mortgage loan 

underwriting, appraisal, and servicing standards and procedures that 

meet or exceed the standards established by the Board;

(F) for purposes of enabling the Corporation to examine the 

facility, agree to allow officers or employees of the Corporation to 

have access to all books, accounts, financial records, reports, files, 

and all other papers, things, or property, of any type whatsoever, 

belonging to or used by the Corporation that are necessary to 

facilitate an examination of the operations of the facility in 

connection with securities, and the pools of qualified loans that back 

securities, for which the Corporation has provided guarantees; and

(G) adopt appropriate minimum standards and procedures 

relating to loan administration and disclosure to borrowers 

concerning the terms and rights applicable to loans for which 
guarantee is provided, in conformity with uniform standards 

established by the Corporation.

(3) NONDISCRIMINATION REQUIREMENT. The standard 

established under this subsection shall not discriminate between or against 

Farm Credit System and non-Farm Credit System applicants.

(b) CERTIFICATION BY CORPORATION. Within 60 days after 

receiving an application for certification under this section, the Corporation shall 

certify the facility if the facility meets the standards established by the 

Corporation under subsection (a)(1) of this section.

(c) MAXIMUM TIME PERIOD FOR CERTIFICATION. Any 

certification by the Corporation of an agricultural mortgage marketing facility 

shall be effective for a period determined by the Corporation of not to exceed 5 

years.

(d) REVOCATION.

(1) IN GENERAL. After notice and an opportunity for a hearing, 

the Corporation may revoke the certification of an agricultural mortgage 

marketing facility if the Corporation determines that the facility no longer 

meets the standards referred to in subsection (a) of this section.

(2) EFFECT OF REVOCATION. Revocation of a certification 

shall not affect any pool guarantee that has been issued by the Corporation.

(e) AFFILIATION OF FCS INSTITUTIONS WITH FACILITY.

(1) ESTABLISHMENT OF AFFILIATE AUTHORIZED. 

Notwithstanding any other provision of this Act, any Farm Credit System 

institution, acting for such institution alone or in conjunction with one or 

more other such institutions, may establish and operate, as an affiliate, an 

agricultural mortgage marketing facility if, within a reasonable time after 

such establishment, such facility obtains and thereafter retains certification 

under subsection (b) of this section as a certified facility.

(2) EXCLUSIVE AGENCY AGREEMENT AUTHORIZED. 

Any number of Farm Credit System institutions (other than the 

Corporation) may enter into an agreement with any certified facility 

(including an affiliate established under paragraph (1)) to sell the qualified 

loans of such institutions exclusively to or through the facility.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-6

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-6 SEC. 8.6. GUARANTEE OF QUALIFIED LOANS.

(a) GUARANTEE AUTHORIZED FOR CERTIFIED FACILITIES. 

(1) IN GENERAL. Subject to the requirements of this section and 

on such other terms and conditions as the Corporation shall consider 

appropriate, the Corporation—

(A) shall guarantee the timely payment of principal and 

interest on the securities issued by a certified facility that represents 

interests solely in, or obligations fully backed by, any pool consisting 

solely of qualified loans which meet the applicable standards 

established under section 8.8 and which are held by such facility; and

(B) may issue a security, guaranteed as to the timely payment 

of principal and interest, that represents an interest solely in, or an 

obligation fully backed by, a pool consisting of qualified loans that--

(i) meet the applicable standards established under 

section 8.8; and

(ii) have been purchased and held by the Corporation.

(2) INABILITY OF FACILITY TO PAY. If the facility is unable 

to make any payment of principal or interest on any security for which a 

guarantee has been provided by the Corporation under paragraph (1) of this 

section the Corporation shall make such payment as and when due in cash 

and on such payment shall be subrogated fully to the rights satisfied by 

such payment.

(3) POWER OF CORPORATION. Notwithstanding any other 

provision of law, the Corporation is empowered, in connection with any 

guarantee under this subsection, whether before or after any default, to 

provide by contract with the facility for the extinguishment, on default by 

the facility, of any redemption, equitable, legal, or other right, title, or 

interest of the facility in any mortgage or mortgages constituting the pool 

against which the guaranteed securities are issued. With respect to any 

issue of guaranteed securities, in the event of default and pursuant 

otherwise to the terms of the contract, the mortgages that constitute such 

pool shall become the absolute property of the Corporation subject only to 

the unsatisfied rights of the holders of the securities based on and backed 

by such pool.

(b) OTHER RESPONSIBILITIES OF AND LIMITATIONS ON 

CERTIFIED FACILITIES. As a condition for providing any guarantees under 

this section for securities issued by a certified facility that represent interests in, 
or obligations backed by, any pool of qualified loans, the Corporation shall 

require such facility to agree to comply with the following requirements:

(1) LOAN DEFAULT RESOLUTION. The facility shall act in 

accordance with the standards of a prudent institutional lender to resolve 

loan defaults.

(2) SUBROGATION OF UNITED STATES AND 

CORPORATION TO INTERESTS OF FACILITY. The proceeds of any 

collateral, judgments, settlements, or guarantees received by the facility 

with respect to any loan in such pool, shall be applied, after payment of 

costs of collection—

(A) first, to reduce the amount of any principal outstanding 

on any obligation of the Corporation that was purchased by the 

Secretary of the Treasury under section 8.13 to the extent the 

proceeds of such obligation were used to make guarantees in 

connection with such securities; and

(B) second, to reimburse the Corporation for any such 

guarantee payments.

(3) LOAN SERVICING. The originator of any loan in such pool 

shall be permitted to retain the right to service the loan.

(4) MINORITY PARTICIPATION IN PUBLIC OFFERINGS. 

The facility shall take such steps as may be necessary to ensure that 

minority owned or controlled investment banking firms, underwriters, and 

bond counsels throughout the United States have an opportunity to 

participate to a significant degree in any public offering of securities.

(5) NO DISCRIMINATION AGAINST STATES WITH 

BORROWERS RIGHTS. The facility may not refuse to purchase 

qualified loans originating in States that have established borrowers rights 

laws either by statute or under the constitution of such States, except that 

the facility may require discounts or charge fees reasonably related to costs 

and expenses arising from such statutes or constitutional provisions.

(c) ADDITIONAL AUTHORITY OF THE BOARD. To ensure the 

liquidity of securities for which guarantees have been provided under this section, 

the Board shall adopt appropriate standards regarding—

(1) the characteristics of any pool of qualified loans serving as 

collateral for such securities; and

(2) transfer requirements.

(d) AGGREGATE PRINCIPAL AMOUNTS OF QUALIFIED LOANS.

(1) INITIAL YEAR. During the first year after the date of the 

enactment of this title, the Corporation may not provide guarantees for 

securities representing interests in, or obligations backed by, qualified 

loans (other than loans which back securities issued by Farm Credit System 

institutions for which the Corporation provides a guarantee) in an 

aggregate principal amount in excess of 2 percent of the total agricultural 

real estate debt outstanding at the close of the prior calendar year (as 

published by the Board of Governors of the Federal Reserve System), less 

all Farmers Home Administration agricultural real estate debt.

(2) SECOND YEAR. During the year following the year referred 

to in paragraph (1), the Corporation may not provide guarantees for 

securities representing interests in, or obligations backed by, qualified 

loans (other than loans which back securities issued by Farm Credit System 

institutions for which the Corporation provides a guarantee) in an 
additional principal amount in excess of 4 percent of the total agricultural 

real estate debt outstanding at the close of the prior calendar year, less all 

Farmers Home Administration agricultural real estate debt.

(3) THIRD YEAR. During the year following the year referred to 

in paragraph (2), the Corporation may not provide guarantees for securities 

representing interests in, or obligations backed by, qualified loans (other 

than loans which back securities issued by Farm Credit System institutions 

for which the Corporation provides a guarantee) in an additional principal 

amount in excess of 8 percent of the total agricultural real estate debt 

outstanding at the close of the prior calendar year, less all Farmers Home 

Administration agricultural real estate debt.

(4) SUBSEQUENT YEARS. In years subsequent to the year 

referred to in paragraph (3), the Corporation may provide guarantees 

without regard to the principal amount of the qualified loans guaranteed.

(e) PURCHASE OF GUARANTEED SECURITIES.

(1) PURCHASE AUTHORITY. The Corporation (and affiliates) 

may purchase, hold, and sell any securities guaranteed under this section 

by the Corporation that represent interests in, or obligations backed by, 

pools of qualified loans. Securities issued under this section shall have 

maturities and bear rates of interest as determined by the Corporation.

(2) ISSUANCE OF DEBT OBLIGATIONS. The Corporation 

(and affiliates) may issue debt obligations solely for the purpose of 

obtaining amounts for the purchase of any securities under paragraph (1), 

for the purchase of qualified loans (as defined in section 8.0(9)), and for 

maintaining reasonable amounts for business operations (including 

adequate liquidity) relating to activities under this subsection.

(3) TERMS AND LIMITATIONS.

(A) TERMS. The obligations issued under this subsection 

shall have maturities and bear rates of interest as determined by the 

Corporation, and may be redeemable at the option of the Corporation 

before maturity in the manner stipulated in the obligations.

(B) REQUIREMENT. Each obligation shall clearly indicate 

that the obligation is not an obligation of, and is not guaranteed as to 

principal and interest by, the Farm Credit Administration, the United 

States, or any other agency or instrumentality of the United States 

(other than the Corporation).

(C) AUTHORITY. The Corporation may not issue 

obligations pursuant to paragraph (2) under this subsection while any 

obligation issued by the Corporation under section 8.13(a) remains 

outstanding.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-7

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-7 SEC. 8.7. [Repealed]
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-8

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-8 SEC. 8.8. STANDARDS FOR QUALIFIED LOANS.

(a) STANDARDS. 

(1) IN GENERAL.--The Corporation shall establish underwriting, 

security appraisal, and repayment standards for qualified loans taking into 

account the nature, risk profile, and other differences between different 

categories of qualified loans. 

(2) SUPERVISION, EXAMINATION, AND REPORT OF 

CONDITION.--The standards shall be subject to the authorities of the 

Farm Credit Administration under section 8.11.

(3) MORTGAGE LOANS.--In establishing standards for qualified 

loans, the Corporation shall confine corporate operations, so far as 

practicable, to mortgage loans that are deemed by the Board to be of such 

quality so as to meet, substantially and generally, the purchase standards 

imposed by private institutional mortgage investors.

(b) MINIMUM CRITERIA. To further the purpose of this title to 

provide a new source of long-term fixed rate financing to assist farmers and 

ranchers to purchase agricultural real estate, the standards established by the 

Board pursuant to subsection (a) of this section with respect to loans secured by 

agricultural real estate shall, at a minimum—

(1) provide that no agricultural mortgage loan with a loan-to-value 

ratio in excess of 80 percent may be treated as a qualified loan;

(2) require each borrower to demonstrate sufficient cash-flow to 

adequately service the agricultural mortgage loan;

(3) contain sufficient documentation standards;

(4) contain adequate standards to protect the integrity of the 

appraisal process with respect to any agricultural mortgage loans;

(5) contain adequate standards to ensure that the farmer or rancher 

is or will be actively engaged in agricultural production, and require the 

borrower to certify to the originator that the borrower intends to continue 

agricultural production on the farm or ranch involved;

(6) minimize speculation in agricultural real estate for 

nonagricultural purposes; and

(7) in establishing the value of agricultural real estate, consider the 

purpose for which the real estate is taxed.

(c) LOAN AMOUNT LIMITATION.

(1) IN GENERAL. A loan secured by agricultural real estate may 

not be treated as a qualified loan if the principal amount of such loan 
exceeds $2,500,000, adjusted for inflation, except as provided in paragraph 

(2).

(2) ACREAGE EXCEPTION. Paragraph (1) shall not apply with 

respect to any agricultural mortgage loan described in such paragraph if 

such loan is secured by agricultural real estate that, in the aggregate, 

comprises not more than 1,000 acres.

(d) NONDISCRIMINATION REQUIREMENT. The standards 

established under subsection (a) shall not discriminate against small originators 

or small agricultural mortgage loans that are at least $50,000. The Board shall 

promote and encourage the inclusion of qualified loans for small farms and 

family farmers in the agricultural mortgage secondary market.
 Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-9

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-9 SEC. 8.9. EXEMPTION FROM RESTRUCTURING AND 

BORROWERS RIGHTS PROVISIONS FOR POOLED LOANS.

(a) RESTRUCTURING. Notwithstanding any other provision of law, 

sections 4.14, 4.14A, 4.14B, 4.14C, and 4.14D and 4.36 shall not apply to any 

loan included in a pool of qualified loans backing securities or obligations for 

which the Corporation provides guarantee. The loan servicing standards 

established by the Corporation shall be patterned after similar standards adopted 

by other federally sponsored secondary market facilities.

(b) BORROWERS RIGHTS. At the time of application for a loan (as 

defined in section 4.14A(a)(5)), originators that are Farm Credit System 

institutions shall give written notice to each applicant of the terms and conditions 

of the loan, setting forth separately terms and conditions for pooled loans and 

loans that are not pooled. This notice shall include a statement, if applicable, that 

the loan may be pooled and that, if pooled, sections 4.14, 4.14A, 4.14B, 4.14C, 

and 4.14D and 4.36 shall not apply. This notice also shall inform the applicant 

that he or she has the right not to have the loan pooled. Within 3 days from the 

time of commitment, an applicant has the right to refuse to allow the loan to be 

pooled, thereby retaining rights under sections 4.14, 4.14A, 4.14B, 4.14C, and 

4.14D and 4.36, if applicable.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-10

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-10 SEC. 8.10. FUNDING FOR GUARANTEE; RESERVES OF 

CORPORATION.

(a) GUARANTEE. The Corporation shall provide guarantees for 

securities representing interests in, or obligations backed by, pools of qualified 

loans through commitments issued by the Corporation providing for guarantees.

(b) GUARANTEE FEES.

(1) INITIAL FEE. At the time a guarantee is issued by the 

Corporation, the Corporation shall assess the certified facility a fee of not 

more than 1/2 of 1 percent of the initial principal amount of each pool of 

qualified loans.

(2) ANNUAL FEES. Beginning in the second year after the date 

the guarantee is issued under paragraph (1), the Corporation may, at the 

end of each year, assess the certified facility an annual fee of not more than 

1/2 of 1 percent of the principal amount of the loans then constituting the 

pool.

(3) DETERMINATION OF AMOUNT. The Corporation shall 

establish such fees on the amount of risk incurred by the Corporation in 

providing the guarantees with respect to which such fee is assessed, as 

determined by the Corporation. Fees assessed under paragraphs (1) and (2) 

shall be established on an actuarially sound basis.

(4) REVIEW BY GAO. The Comptroller General of the United 

States may review, and submit to the Congress a report regarding, the 

actuarial soundness and reasonableness of the fees established by the 

Corporation under this subsection.

(c) CORPORATION RESERVE AGAINST GUARANTEES LOSSES 

REQUIRED.

(1) IN GENERAL. So much of the fees assessed under this 

section as the Board determines to be necessary shall be set aside by the 

Corporation in a segregated account as a reserve against losses arising out 

of the guarantee activities of the Corporation.

(2) EXHAUSTION OF RESERVE REQUIRED. The Corporation 

may not issue obligations to the Secretary of the Treasury under section 

8.13 in order to meet the obligations of the Corporation with respect to any 

guarantees provided under this title until the reserve established under 

paragraph (1) has been exhausted.

(d) FEES TO COVER ADMINISTRATIVE COSTS AUTHORIZED. 

The Corporation may impose charges or fees in reasonable amounts in 
connection with the administration of its activities under this title to recover its 

costs for performing such administration.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-11

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-11 SEC. 8.11. SUPERVISION, EXAMINATION, AND REPORT OF 

CONDITION.

(a) REGULATION.

(1) AUTHORITY. Notwithstanding any other provision of this 

Act, the Farm Credit Administration shall have the authority to provide, 

acting through the Office of Secondary Market Oversight—

(A) for the examination of the Corporation and its affiliates; 

and

(B) for the general supervision of the safe and sound 

performance of the powers, functions, and duties vested in the 

Corporation and its affiliates by this title, including through the use 

of the authorities granted to the Farm Credit Administration under—

(i) part C of title V; and

(ii) beginning 6 months after December 13, 1991, 

section 5.17(a)(9).

(2) CONSIDERATIONS. In exercising its authority pursuant to 

this section, the Farm Credit Administration shall consider—

(A) the purposes for which the Corporation was created;

(B) the practices appropriate to the conduct of secondary 

markets in agricultural loans; and

(C) the reduced levels of risk associated with appropriately 

structured secondary market transactions.

(3) OFFICE OF SECONDARY MARKET OVERSIGHT.

(A) Not later than 180 days after the date of enactment of 

this paragraph, the Farm Credit Administration Board shall establish 

within the Farm Credit Administration the Office of Secondary 

Market Oversight.

(B) The Farm Credit Administration Board shall carry out 

the authority set forth in this section through the Office of Secondary 

Market Oversight.

(C) The Office of Secondary Market Oversight shall be 

managed by a full-time Director who shall be selected by and report 

to the Farm Credit Administration Board.

(b) EXAMINATIONS AND AUDITS.

(1) IN GENERAL. The financial transactions of the Corporation 

shall be examined by examiners of the Farm Credit Administration in 

accordance with the principles and procedures applicable to commercial 
corporate transactions under such rules and regulations as may be 

prescribed by the Administration.

(2) FREQUENCY. The examinations shall occur at such times as 

the Farm Credit Administration Board may determine, but in no event less 

than once each year.

(3) ACCESS. The examiners shall—

(A) have access to all books, accounts, financial records, 

reports, files, and all other papers, things, or property belonging to or 

in use by the Corporation and necessary to facilitate the audit; and

(B) be afforded full access for verifying transactions with 

certified facilities and other entities with whom the Corporation 

conducts transactions.

(c) ANNUAL REPORT OF CONDITION. The Corporation shall make 

and publish an annual report of condition as prescribed by the Farm Credit 

Administration. Each report shall contain financial statements prepared in 

accordance with generally accepted accounting principles and contain such 

additional information as the Farm Credit Administration may by regulation 

prescribe. The financial statements of the Corporation shall be audited by an 

independent public accountant.

(d) FCA ASSESSMENTS TO COVER COSTS. The Farm Credit 

Administration shall assess the Corporation for the cost to the Administration of 

any regulatory activities conducted under this section, including the cost of any 

examination.

(e) DEFINITION OF AFFILIATE. As used in this title, the term 

"affiliate" shall mean an entity effectively controlled or owned by the 

Corporation, except that such term shall not include an originator (as defined in 

section 8.0(7)).

(f) The Farm Credit Administration Board shall ensure that

(1) the Office of Secondary Market Oversight has access to a 

sufficient number of qualified and trained employees to adequately 

supervise the secondary market activities of the Corporation; and

(2) the supervision of the powers, functions, and duties of the 

Corporation is performed, to the extent practicable, by personnel who are 

not responsible for the supervision of the banks and associations of the 

Farm Credit System.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-12

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-12 SEC. 8.12. SECURITIES IN CREDIT ENHANCED POOLS.

(a) FEDERAL LAWS.

(1) APPLICABILITY OF CERTAIN FEDERAL SECURITIES 

LAWS. For purposes of section 3(a)(2) of the Securities Act of 1933, no 

security representing an interest in, or obligations backed by, a pool of 

qualified loans for which guarantees have been provided by the 

Corporation shall be deemed to be a security issued or guaranteed by a 

person controlled or supervised by, or acting as an instrumentality of, the 

Government of the United States. No such security shall be deemed to be a 

"government security" for purposes of the Securities Exchange Act of 1934 

or for purposes of the Investment Company Act of 1940.

(2) NO FULL FAITH AND CREDIT OF THE UNITED STATES. 

Each security for which credit enhancement has been provided by the 

Corporation shall clearly indicate that the security is not an obligation of, 

and is not guaranteed as to principal or interest by, the Farm Credit 

Administration, the United States, or any other agency or instrumentality of 

the United States (other than the Corporation).

(b) STATE SECURITIES LAWS.

(1) GENERAL EXEMPTION. Any security or obligation that has 

been provided a guarantee by the Corporation shall be exempt from any 

law of any State with respect to or requiring registration or qualification of 

securities or real estate to the same extent as any obligation issued by, or 

guaranteed as to principal and interest by, the United States or any agency 

or instrumentality of the United States.

(2) STATE OVERRIDE. The provisions of paragraph (1) shall 

not be applicable to any State that, during the 8-year period beginning on 

the date of the enactment of this title, enacts a law that--

(A) specifically refers to this subsection; and

(B) expressly provides that paragraph (1) shall not apply to 

the State.

(c) AUTHORIZED INVESTMENTS.

(1) IN GENERAL. Securities representing an interest in, or 

obligations backed by, pools of qualified loans with respect to which the 

Corporation has provided a guarantee shall be authorized investments of 

any person, trust, corporation, partnership, association, business trust, or 

business entity created pursuant to or existing under the laws of the United 

States or any State to the same extent that the person, trust, corporation, 

partnership, association, business trust, or business entity is authorized 
under any applicable law to purchase, hold, or invest in obligations issued 

by or guaranteed as to principal and interest by the United States or any 

agency or instrumentality of the United States. Such securities or 

obligations may be accepted as security for all fiduciary, trust, and public 

funds, the investment or deposits of which shall be under the authority and 

control of the United States or any State or any officers of either.

(2) STATE LIMITATIONS ON PURCHASE, HOLDING, OR 

INVESTMENT. If State law limits the purchase, holding, or investment in 

obligations issued by the United States by the person, trust, corporation, 

partnership, association, business trust, or business entity, securities or 

obligations of a certified facility issued on which the Corporation has 

provided a guarantee shall be considered to be obligations issued by the 

United States for purposes of the limitation.

(3) NONAPPLICABILITY OF PROVISIONS.

(A) SUBSEQUENT STATE LAW. Paragraphs (1) and (2) 

shall not apply with respect to a particular person, trust, corporation, 

partnership, association, business trust, or business entity, or class 

thereof, in any State that, prior to the expiration of the 8-year period 

beginning on the date of the enactment of this title, enacts a law that 

specifically refers to this section and either prohibits or provides for 

a more limited authority to purchase, hold, or invest in the securities 

by any person, trust, corporation, partnership, association, business 

trust, or business entity, or class thereof, than is provided in 

paragraphs (1) and (2).

(B) EFFECT OF SUBSEQUENT STATE LAW. The 

enactment by any State of a law of the type described in 

subparagraph (A) shall not affect the validity of any contractual 

commitment to purchase, hold, or invest that was made prior to the 

effective date of the law and shall not require the sale or other 

disposition of any securities acquired prior to the effective date of the 

law.

(d) STATE USURY LAWS SUPERSEDED. A provision of the 

Constitution or law of any State shall not apply to an agricultural loan made by 

an originator or a certified facility in accordance with this title for sale to the 

Corporation or to a certified facility for inclusion in a pool for which the 

Corporation has provided, or has committed to provide, a guarantee, if the loan, 

not later than 180 days after the date the loan was made, is sold to the 

Corporation or included in a pool for which the Corporation has provided a 

guarantee, if the provision—

(1) limits the rate or amount of interest, discount points, finance 

charges, or other charges that may be charged, taken, received, or reserved 

by an agricultural lender or a certified facility; or

(2) limits or prohibits a prepayment penalty (either fixed or 

declining), yield maintenance, or make-whole payment that may be 

charged, taken, or received by an agricultural lender or a certified facility 

in connection with the full or partial payment of the principal amount due 

on a loan by a borrower in advance of the scheduled date for the payment 

under the terms of the loan, otherwise known as a prepayment of the loan 

principal.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-13

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-13 SEC. 8.13. AUTHORITY TO ISSUE OBLIGATIONS TO COVER 

GUARANTEE LOSSES OF CORPORATION.

(a) SALE OF OBLIGATIONS TO TREASURY.

(1) IN GENERAL. Subject to the limitations contained in section 

8.10(c) and the requirement of paragraph (2), the Corporation may issue 

obligations to the Secretary of the Treasury the proceeds of which may be 

used by the Corporation solely for the purpose of fulfilling the obligations 

of the Corporation under any guarantee provided by the Corporation under 

this title.

(2) CERTIFICATION. The Secretary of the Treasury may 

purchase obligations of the Corporation under paragraph (1) only if the 

Corporation certifies to the Secretary that—

(A) the requirements of section 8.10(c) have been fulfilled; 

and

(B) the proceeds of the sale of such obligations are needed to 

fulfill the obligations of the Corporation under any guarantee 

provided by the Corporation under this title.

(b) EXPEDITIOUS TRANSACTION REQUIRED. Not later than 10 

business days after receipt by the Secretary of the Treasury of any certification 

by the Corporation under subsection (a)(2) of this section, the Secretary of the 

Treasury shall purchase obligations issued by the Corporation in an amount 

determined by the Corporation to be sufficient to meet the guarantee liabilities of 

the Corporation.

(c) LIMITATION ON AMOUNT OF OUTSTANDING 

OBLIGATIONS. The aggregate amount of obligations issued by the 

Corporation under subsection (a)(1) of this section which may be held by the 

Secretary of the Treasury at any time (as determined by the Secretary) shall not 

exceed $1,500,000,000.

(d) TERMS OF OBLIGATION.

(1) INTEREST. Each obligation purchased by the Secretary of 

the Treasury shall bear interest at a rate determined by the Secretary, taking 

into consideration the average rate on outstanding marketable obligations 

of the United States as of the last day of the last calendar month ending 

before the date of the purchase of such obligation.

(2) REDEMPTION. The Secretary of the Treasury shall require 

that such obligations be repurchased by the Corporation within a 

reasonable time.

(e) COORDINATION WITH TITLE 31, UNITED STATES CODE.
(1) AUTHORITY TO USE PROCEEDS FROM SALE OF 

TREASURY SECURITIES. For the purpose of purchasing obligations of 

the Corporation, the Secretary of the Treasury may use as a public debt 

transaction the proceeds from the sale by the Secretary of any securities 

issued under chapter 31, of title 31, United States Code, and the purposes 

for which securities may be issued under such chapter are extended to 

include such purchases.

(2) TREATMENT OF TRANSACTIONS. All purchases and 

sales by the Secretary of the Treasury of obligations issued by the 

Corporation under this section shall be treated as public debt transactions 

of the United States.

(f) AUTHORIZATION OF APPROPRIATIONS. There is authorized 

to be appropriated to the Secretary of the Treasury $1,500,000,000, without fiscal 

year limitation, to carry out the purposes of this title.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle A - Establishment and Activities of Federal Agricultural Mortgage 

Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa-14

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa-14 SEC. 8.14. FEDERAL JURISDICTION.

Notwithstanding section 1349 of Title 28, United States Code, or any other 

provision of law:

(1) The Corporation shall be considered an agency under sections 

1345 and 1442 of such title.

(2) All civil actions to which the Corporation is a party shall be 

deemed to arise under the laws of the United States and, to the extent 

applicable, shall be deemed to be governed by Federal common law. The 

district courts of the United States shall have original jurisdiction of all 

such actions, without regard to amount of value.

(3) Any civil or other action, case, or controversy in a court of a 

State or any court, other than a district court of the United States, to which 

the Corporation is a party may at any time before trial be removed by the 

Corporation, without the giving of any bond or security—

(A) to the District Court of the United States for the district 

and division embracing the place where the same is pending; or

(B) if there is no such district court, to the District Court of 

the United States for the district in which the principal office of the 

Corporation is located; by following any procedure for removal for 

causes in effect at the time of such removal.

(4) No attachment or execution shall be issued against the 

Corporation or any of the property of the Corporation before final 

judgment in any Federal, State, or other court.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279bb

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle B—Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

12 U.S.C. 2279bb SEC. 8.31. DEFINITIONS.

For purposes of this subtitle:

(1) COMPENSATION. The term "compensation" means any 

payment of money or the provision of any other thing of current or 

potential value in connection with employment.

(2) CORE CAPITAL. The term "core capital" means, with 

respect to the Corporation, the sum of the following (as determined in 

accordance with generally accepted accounting principles):

(A) The par value of outstanding common stock.

(B) The par value of outstanding preferred stock.

(C) Paid-in capital.

(D) Retained earnings.

(3) DIRECTOR. The term "Director" means the Director of the 

Office of Secondary Market Oversight of the Farm Credit Administration, 

selected under section 8.11(a)(3).

(4) OFFICE. The term "Office" means the Office of Secondary 

Market Oversight of the Farm Credit Administration, established in section 

8.11(a).

(5) REGULATORY CAPITAL. The term "regulatory capital" 

means, with respect to the Corporation, the core capital of the Corporation 

plus an allowance for losses and guarantee claims, as determined in 

accordance with generally accepted accounting principles.

(6) STATE. The term "State" means the States of the United 

States, the District of Columbia, the Commonwealth of Puerto Rico, the 

Commonwealth of the Northern Mariana Islands, Guam, the Virgin Islands, 

American Samoa, the Trust Territory of the Pacific Islands, and any other 

territory or possession of the United States.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C.2279bb-1 

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279bb-1 SEC. 8.32. RISK-BASED CAPITAL LEVELS.

(a) RISK-BASED CAPITAL TEST. Not sooner than the expiration of 

the 3-year period beginning on the date of enactment of the Farm Credit System 

Reform Act of 1996, the Director of the Office of Secondary Market Oversight 

shall, by regulation, establish a risk-based capital test under this section for the 

Corporation. When applied to the Corporation, the risk-based capital test shall 

determine the amount of regulatory capital for the Corporation that is sufficient 

for the Corporation to maintain positive capital during a 10-year period in which 

both of the following circumstances occur:

(1) CREDIT RISK. 

(A) IN GENERAL.--With respect to securities representing 

an interest in, or obligations backed by, a pool of qualified loans 

owned or guaranteed by the Corporation and other obligations of the 

Corporation, losses on the underlying qualified loans occur 

throughout the United States at a rate of default and severity (based 

on any measurements of default reasonably related to prevailing 

industry practice in determining capital adequacy) reasonably related 

to the rate and severity that occurred in contiguous areas of the 

United States containing an aggregate of not less than 5 percent of 

the total population of the United States that, for a period of not less 

than 2 years (as established by the Director), experienced the highest 

rates of default and severity of agricultural mortgage losses, in 

comparison with such rates of default and severity of agricultural 

mortgage losses in other such areas for any period of such duration, 

as determined by the Director.

(B) RURAL UTILITY LOANS.--With respect to securities 

representing an interest in, or obligation backed by, a pool of 

qualified loans described in section 8.0(9)(C) owned or guaranteed 

by the Corporation, losses occur at a rate of default and severity 

reasonably related to risks in electric and telephone facility loans (as 

applicable), as determined by the Director.

(2) INTEREST RATE RISK. Interest rates on Treasury 

obligations of varying terms increase or decrease over the first 12 months 

of such 10-year period by not more than the lesser of (A) 50 percent (with 

respect to the average interest rates on such obligations during the 12-

month period preceding the 10-year period), or (B) 600 basis points, and 

remain at such level for the remainder of the period. This paragraph may 

not be construed to require the Director to determine interest rate risk under 
this paragraph based on the interest rates for various long-term and shortterm obligations all increasing or all decreasing concurrently.

(b) CONSIDERATIONS.

(1) ESTABLISHMENT OF TEST. In establishing the risk-based 

capital test under subsection (a)—

(A) the Director shall take into account appropriate 

distinctions based on various types of agricultural mortgage products, 

varying terms of Treasury obligations, and any other factors the 

Director considers appropriate;

(B) the Director shall conform loan data used in determining 

credit risk to the minimum geographic and commodity 

diversification standards applicable to pools of qualified loans 

eligible for guarantee;

(C) the Director may take into account retained subordinated 

participating interests under section 8.6(b)(2) (as in effect before the 

date of the enactment of the Farm Credit System Reform Act of 

1996);

(D) the Director may take into account other methods or 

tests to determine credit risk developed by the Corporation before 

December 13, 1991; and

(E) the Director shall consider any other information 

submitted by the Corporation in writing during the 180-day period 

beginning on December 13, 1991.

(2) REVISING TEST. Upon the expiration of the 8-year period 

beginning on December 13, 1991, the Director shall examine the risk-based 

capital test under subsection (a) and may revise the test. In making 

examinations and revisions under this paragraph, the Director shall take 

into account that, before December 13, 1991, the Corporation has not 

issued guarantees for pools of qualified loans. To the extent that the 

revision of the risk-based capital test causes a change in the classification 

of the Corporation within the enforcement levels established under section 

8.35, the Director shall waive the applicability of any additional 

enforcement actions available because of such change for a reasonable 

period of time, to permit the Corporation to increase the amount of 

regulatory capital of the Corporation accordingly.

(c) RISK-BASED CAPITAL LEVEL. For purposes of this subtitle, the 

risk-based capital level for the Corporation shall be equal to the sum of the 

following amounts:

(1) CREDIT AND INTEREST RATE RISK. The amount of 

regulatory capital determined by applying the risk-based capital test under 

subsection (a) to the Corporation, adjusted to account for foreign exchange 

risk.

(2) MANAGEMENT AND OPERATIONS RISK. To provide for 

management and operations risk, 30 percent of the amount of regulatory 

capital determined by applying the risk-based capital test under subsection 

(a) to the Corporation.

(d) SPECIFIED CONTENTS.

(1) IN GENERAL. The regulations establishing the risk-based 

capital test under this section shall—
(A) be issued by the Director for public comment in the form 

of a notice of proposed rulemaking, to be first published after the 

expiration of the period referred to in subsection (a); and

(B) contain specific requirements, definitions, methods, 

variables, and parameters used under the risk-based capital test and 

in implementing the test (such as loan loss severity, float income, 

loan-to-value ratios, taxes, yield curve slopes, default experience, 

prepayment rates, and performance of pools of qualified loans). 

(2) SPECIFICITY. The regulations referred to in paragraph (1) 

shall be sufficiently specific to permit an individual other than the Director 

to apply the test in the same manner as the Director.

(e) AVAILABILITY OF MODEL. The Director shall make copies of 

the statistical model or models used to implement the risk-based capital test 

under this section available for public acquisition and may charge a reasonable 

fee for such copies.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279bb-2 

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279bb-2 SEC. 8.33. MINIMUM CAPITAL LEVEL.

(a) IN GENERAL. Except as provided in subsection (b), for purposes 

of this subtitle, the minimum capital level for the Corporation shall be an amount 

of core capital equal to the sum of—

(1) 2.75 percent of the aggregate on-balance sheet assets of the 

Corporation, as determined in accordance with generally accepted 

accounting principles; and

(2) 0.75 percent of the aggregate off-balance sheet obligations of 

the Corporation, which, for the purposes of this subtitle, shall include—

(A) the unpaid principal balance of outstanding securities 

that are guaranteed by the Corporation and backed by pools of 

qualified loans;

(B) instruments that are issued or guaranteed by the 

Corporation and are substantially equivalent to instruments described 

in subparagraph (A); and

(C) other off-balance sheet obligations of the Corporation.

(b) TRANSITION PERIOD.

(1) IN GENERAL. For purposes of this subtitle, the minimum 

capital level for the Corporation—

(A) prior to January 1, 1997, shall be the amount of core 

capital equal to the sum of—

(i) 0.45 percent of aggregate off-balance sheet 

obligations of the Corporation;

(ii) 0.45 percent of designated on-balance sheet assets 

of the Corporation, as determined under paragraph (2); and

(iii) 2.50 percent of on-balance sheet assets of the 

Corporation other than assets designated under paragraph (2);

(B) during the 1-year period ending December 31, 1997, 

shall be the amount of core capital equal to the sum of—

(i) 0.55 percent of aggregate off-balance sheet 

obligations of the Corporation;

(ii) 1.20 percent of designated on-balance sheet assets 

of the Corporation, as determined under paragraph (2); and

(iii) 2.55 percent of on-balance sheet assets of the 

Corporation other than assets designated under paragraph (2);

(C) during the 1-year period ending December 31, 1998, 

shall be the amount of core capital equal to—
(i) if the Corporation's core capital is not less than 

$25,000,000 on January 1, 1998, the sum of—

(I) 0.65 percent of aggregate off-balance sheet 

obligations of the Corporation;

(II) 1.95 percent of designated on-balance sheet 

assets of the Corporation, as determined under paragraph 

(2); and

(III) 2.65 percent of on-balance sheet assets of 

the Corporation other than assets designated under 

paragraph (2); or

(ii) if the Corporation's core capital is less than 

$25,000,000 on January 1, 1998, the amount determined under 

subsection (a); and

(D) on and after January 1, 1999, shall be the amount 

determined under subsection (a).

(2) DESIGNATED ON-BALANCE SHEET ASSETS. For 

purposes of this subsection, the designated on-balance sheet assets of the 

Corporation shall be—

(A) the aggregate on-balance sheet assets of the Corporation 

acquired under section 8.6(e); and

(B) the aggregate amount of qualified loans purchased and 

held by the Corporation under section 8.3(c)(13).
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279bb-3 

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279bb-3 SEC. 8.34. CRITICAL CAPITAL LEVEL.

For purposes of this subtitle, the critical capital level for the Corporation 

shall be an amount of core capital equal to 50 percent of the total minimum 

capital amount determined under section 8.33.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279bb-4

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279bb-4 SEC. 8.35. ENFORCEMENT LEVELS.

(a) IN GENERAL. The Director shall classify the Corporation, for 

purposes of this subtitle, according to the following enforcement levels:

(1) LEVEL I. The Corporation shall be classified as within level I 

if the Corporation—

(A) maintains an amount of regulatory capital that is equal to 

or exceeds the risk-based capital level established under section 8.32; 

and

(B) equals or exceeds the minimum capital level established 

under section 8.33.

(2) LEVEL II. The Corporation shall be classified as within level 

II if—

(A) the Corporation—

(i) maintains an amount of regulatory capital that is 

less than the risk-based capital level; and

(ii) equals or exceeds the minimum capital level; or

(B) the Corporation is otherwise classified as within level II 

under subsection (b) of this section.

(3) LEVEL III. The Corporation shall be classified as within level 

III if—

(A) the Corporation—

(i) does not equal or exceed the minimum capital 

level; and

(ii) equals or exceeds the critical capital level 

established under section 8.34; or

(B) the Corporation is otherwise classified as within level III 

under subsection (b) of this section.

(4) LEVEL IV. The Corporation shall be classified as within level 

IV if the Corporation—

(A) does not equal or exceed the critical capital level; or

(B) is otherwise classified as within level IV under 

subsection (b) of this section.

(b) DISCRETIONARY CLASSIFICATION. If at any time the Director 

determines in writing (and provides written notification to the Corporation and 

the Farm Credit Administration) that the Corporation is taking any action not 

approved by the Director that could result in a rapid depletion of core capital or 

that the value of the property subject to mortgages securitized by the Corporation 
or property underlying securities guaranteed by the Corporation, has decreased 

significantly, the Director may classify the Corporation—

(1) as within level II, if the Corporation is otherwise within level I;

(2) as within level III, if the Corporation is otherwise within level 

II; or

(3) as within level IV, if the Corporation is otherwise within level 

III.

(c) QUARTERLY DETERMINATION. The Director shall determine 

the classification of the Corporation for purposes of this subtitle on not less than 

a quarterly basis (and as appropriate under subsection (b)). The first such 

determination shall be made for the quarter ending March 31, 1992.

(d) NOTICE. Upon determining under subsection (b) or (c) that the 

Corporation is within level II or III, the Director shall provide written notice to 

the Congress and to the Corporation—

(1) that the Corporation is within such level;

(2) that the Corporation is subject to the provisions of section 8.36

or 8.37, as applicable; and

(3) stating the reasons for the classification of the Corporation 

within such level.

(e) IMPLEMENTATION. Notwithstanding paragraphs (1) and (2) of 

subsection (a), during the period beginning on December 13, 1991, and ending 

on the effective date of the risk based capital regulation issued by the Director 

under section 8.32, the Corporation shall be classified as within level I if the 

Corporation equals or exceeds the minimum capital level established under 

section 8.33.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279bb-5

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279bb-5 SEC. 8.36. MANDATORY ACTIONS APPLICABLE TO LEVEL II.

(a) CAPITAL RESTORATION PLAN. If the Corporation is classified 

as within level II, the Corporation shall, within the time period determined by the 

Director, submit to the Director a capital restoration plan and, after approval, 

carry out the plan.

(b) RESTRICTION ON DIVIDENDS. If the Corporation is classified 

as within level II, the Corporation may not make any payment of dividends that 

would result in the Corporation being reclassified as within level III or IV.

(c) RECLASSIFICATION FROM LEVEL II TO LEVEL III. The 

Director shall immediately reclassify the Corporation as within level III (and the 

Corporation shall be subject to the provisions of section 8.37), if--

(1) the Corporation is within level II; and

(2)(A) the Corporation does not submit a capital restoration plan that 

is approved by the Director; or

(B) the Director determines that the Corporation has failed to 

make, in good faith, reasonable efforts necessary to comply with 

such a capital restoration plan and fulfill the schedule for the plan 

approved by the Director.

(d) EFFECTIVE DATE. This section shall take effect upon the 

expiration of the 30-month period beginning on the date of the enactment of this 

section.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279bb-6

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279bb-6 SEC. 8.37. SUPERVISORY ACTIONS APPLICABLE TO LEVEL 

III.

(a) MANDATORY SUPERVISORY ACTIONS.

(1) CAPITAL RESTORATION PLAN. If the Corporation is 

classified as within level III, the Corporation shall, within the time period 

determined by the Director, submit to the Director a capital restoration plan 

and, after approval, carry out the plan.

(2) RESTRICTIONS ON DIVIDENDS.

(A) PRIOR APPROVAL. If the Corporation is classified as 

within level III, the Corporation—

(i) may not make any payment of dividends that 

would result in the Corporation being reclassified as within 

level IV; and

(ii) may make any other payment of dividends only if 

the Director approves the payment before the payment.

(B) STANDARD FOR APPROVAL. If the Corporation is 

classified as within level III, the Director may approve a payment of 

dividends by the Corporation only if the Director determines that the 

payment (i) will enhance the ability of the Corporation to meet the 

risk-based capital level and the minimum capital level promptly, (ii) 

will contribute to the long-term safety and soundness of the 

Corporation, or (iii) is otherwise in the public interest.

(3) RECLASSIFICATION FROM LEVEL III TO LEVEL IV. 

The Director shall immediately reclassify the Corporation as within level 

IV if—

(A) the Corporation is classified as within level III; and

(B)(i) the Corporation does not submit a capital restoration 

plan that is approved by the Director; or

(ii) the Director determines that the Corporation has 

failed to make, in good faith, reasonable efforts necessary to 

comply with such a capital restoration plan and fulfill the 

schedule for the plan approved by the Director.

(b) DISCRETIONARY SUPERVISORY ACTIONS. In addition to any 

other actions taken by the Director (including actions under subsection (a)), the 

Director may, at any time, take any of the following actions if the Corporation is 

classified as within level III:
(1) LIMITATION ON INCREASE IN OBLIGATIONS. Limit 

any increase in, or order the reduction of, any obligations of the

Corporation, including off-balance sheet obligations.

(2) LIMITATION ON GROWTH. Limit or prohibit the growth of 

the assets of the Corporation or require contraction of the assets of the 

Corporation.

(3) PROHIBITION ON DIVIDENDS. Prohibit the Corporation 

from making any payment of dividends.

(4) ACQUISITION OF NEW CAPITAL. Require the 

Corporation to acquire new capital in any form and in any amount 

sufficient to provide for the reclassification of the Corporation as within 

level II.

(5) RESTRICTION OF ACTIVITIES. Require the Corporation to 

terminate, reduce, or modify any activity that the Director determines 

creates excessive risk to the Corporation.

(6) CONSERVATORSHIP. Appoint a conservator for the 

Corporation consistent with this Act.

(c) EFFECTIVE DATE. This section shall take effect on January 1, 

1992.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle B-Regulation of Financial Safety and Soundness of Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279bb-7

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2279bb-7 SEC. 8.38. RECAPITALIZATION OF THE CORPORATION.

(a) MANDATORY RECAPITALIZATION. The Corporation shall 

increase the core capital of the Corporation to an amount equal to or greater than 

$25,000,000, not later than the earlier of—

(1) the date that is 2 years after the date of enactment of this 

section; or

(2) the date that is 180 days after the end of the first calendar 

quarter that the aggregate on-balance sheet assets of the Corporation, plus 

the outstanding principal of the off-balance sheet obligations of the 

Corporation, equal or exceed $2,000,000,000.

(b) RAISING CORE CAPITAL. In carrying out this section, the 

Corporation may issue stock under section 8.4 and otherwise employ any 

recognized and legitimate means of raising core capital in the power of the 

Corporation under section 8.3.

(c) LIMITATION ON GROWTH OF TOTAL ASSETS. During the 2-

year period beginning on the date of enactment of this section, the aggregate onbalance sheet assets of the Corporation plus the outstanding principal of the offbalance sheet obligations of the Corporation may not exceed $3,000,000,000 if 

the core capital of the Corporation is less than $25,000,000.

(d) ENFORCEMENT. If the Corporation fails to carry out subsection (a) 

by the date required under paragraph (1) or (2) of subsection (a), the Corporation 

may not purchase a new qualified loan or issue or guarantee a new loan-backed 

security until the core capital of the Corporation is increased to an amount equal 

to or greater than $25,000,000.
Type: Statute

Statute: 1971 ACT AS AMENDED

Title: Title VIII Agricultural Mortgage Secondary Market

Part: [Part]

Subtitle: Subtitle C--Receivership, Conservatorship, and Liquidation of the Federal 

Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279cc 

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle C—Receivership, Conservatorship, and Liquidation of the Federal 

Agricultural Mortgage Corporation

12 U.S.C. 2279cc SEC. 8.41. CONSERVATORSHIP; LIQUIDATION; 

RECEIVERSHIP.

(a) VOLUNTARY LIQUIDATION. The Corporation may voluntarily 

liquidate only with the consent of, and in accordance with a plan of liquidation 

approved by, the Farm Credit Administration Board.

(b) INVOLUNTARY LIQUIDATION.

(1) IN GENERAL. The Farm Credit Administration Board may 

appoint a conservator or receiver for the Corporation under the 

circumstances specified in section 4.12(b).

(2) APPLICATION. In applying section 4.12(b) to the 

Corporation under paragraph (1)—

(A) the Corporation shall also be considered insolvent if the 

Corporation is unable to pay its debts as they fall due in the ordinary 

course of business;

(B) a conservator may also be appointed for the Corporation 

if the authority of the Corporation to purchase qualified loans or 

issue or guarantee loan-backed securities is suspended; and

(C) a receiver may also be appointed for the Corporation if:

(i)(I) the authority of the Corporation to purchase 

qualified loans or issue or guarantee loan-backed 

securities is suspended; or

(II) the Corporation is classified under section 

8.35 as within level III or IV and the alternative actions 

available under subtitle B are not satisfactory; and

(ii) the Farm Credit Administration determines that 

the appointment of a conservator would not be appropriate.

(3) NO EFFECT ON SUPERVISORY ACTIONS. The grounds 

for appointment of a conservator for the Corporation under this subsection 

shall be in addition to those in section 8.37.

(c) APPOINTMENT OF CONSERVATOR OR RECEIVER.

(1) QUALIFICATIONS. Notwithstanding section 4.12(b), if a 

conservator or receiver is appointed for the Corporation, the conservator or 

receiver shall be—
(A) the Farm Credit Administration or any other 

governmental entity or employee, including the Farm Credit System 

Insurance Corporation; or

(B) any person that—

(i) has no claim against, or financial interest in, the 

Corporation or other basis for a conflict of interest as the 

conservator or receiver; and

(ii) has the financial and management expertise 

necessary to direct the operations and affairs of the 

Corporation and, if necessary, to liquidate the Corporation.

(2) COMPENSATION.

(A) IN GENERAL. A conservator or receiver for the 

Corporation and professional personnel (other than a Federal 

employee) employed to represent or assist the conservator or receiver 

may be compensated for activities conducted as, or for, a conservator 

or receiver.

(B) LIMIT ON COMPENSATION. Compensation may not 

be provided in amounts greater than the compensation paid to 

employees of the Federal Government for similar services, except 

that the Farm Credit Administration may provide for compensation 

at higher rates that are not in excess of rates prevailing in the private 

sector if the Farm Credit Administration determines that 

compensation at higher rates is necessary in order to recruit and 

retain competent personnel.

(C) CONTRACTUAL ARRANGEMENTS. The 

conservator or receiver may contract with any governmental entity, 

including the Farm Credit System Insurance Corporation, to make 

personnel, services, and facilities of the entity available to the 

conservator or receiver on such terms and compensation 

arrangements as shall be mutually agreed, and each entity may 

provide the same to the conservator or receiver.

(3) EXPENSES. A valid claim for expenses of the 

conservatorship or receivership (including compensation under paragraph 

(2)) and a valid claim with respect to a loan made under subsection (f) 

shall—

(A) be paid by the conservator or receiver from funds of the 

Corporation before any other valid claim against the Corporation; 

and 

(B) may be secured by a lien, on such property of the 

Corporation as the conservator or receiver may determine, that shall 

have priority over any other lien.

(4) LIABILITY. If the conservator or receiver for the Corporation 

is not a Federal entity, or an officer or employee of the Federal 

Government, the conservator or receiver shall not be personally liable for 

damages in tort or otherwise for an act or omission performed pursuant to 

and in the course of the conservatorship or receivership, unless the act or 

omission constitutes gross negligence or any form of intentional tortious 

conduct or criminal conduct.

(5) INDEMNIFICATION. The Farm Credit Administration may 

allow indemnification of the conservator or receiver from the assets of the 
conservatorship or receivership on such terms as the Farm Credit 

Administration considers appropriate.

(d) JUDICIAL REVIEW OF APPOINTMENT.

(1) IN GENERAL. Notwithstanding subsection (i)(1), not later 

than 30 days after a conservator or receiver is appointed under subsection 

(b), the Corporation may bring an action in the United States District Court 

for the District of Columbia for an order requiring the Farm Credit 

Administration Board to remove the conservator or receiver. The court 

shall, on the merits, dismiss the action or direct the Farm Credit 

Administration Board to remove the conservator or receiver.

(2) STAY OF OTHER ACTIONS. On the commencement of an 

action under paragraph (1), any court having jurisdiction of any other 

action or enforcement proceeding authorized under this Act to which the 

Corporation is a party shall stay the action or proceeding during the 

pendency of the action for removal of the conservator or receiver.

(e) GENERAL POWERS OF CONSERVATOR OR RECEIVER. The 

conservator or receiver for the Corporation shall have such powers to conduct the 

conservatorship or receivership as shall be provided pursuant to regulations 

adopted by the Farm Credit Administration Board. Such powers shall be 

comparable to the powers available to a conservator or receiver appointed 

pursuant to section 4.12(b).

(f) BORROWINGS FOR WORKING CAPITAL.

(1) IN GENERAL. If the conservator or receiver of the 

Corporation determines that it is likely that there will be insufficient funds 

to pay the ongoing administrative expenses of the conservatorship or 

receivership or that there will be insufficient liquidity to fund maturing 

obligations of the conservatorship or receivership, the conservator or 

receiver may borrow funds in such amounts, from such sources, and at 

such rates of interest as the conservator or receiver considers necessary or 

appropriate to meet the administrative expenses or liquidity needs of the 

conservatorship or receivership.

(2) WORKING CAPITAL FROM FARM CREDIT BANKS. A 

Farm Credit bank may loan funds to the conservator or receiver for a loan 

authorized under paragraph (1) or, in the event of receivership, a Farm 

Credit bank may purchase assets of the Corporation.

(g) AGREEMENTS AGAINST INTERESTS OF CONSERVATOR OR 

RECEIVER. No agreement that tends to diminish or defeat the right, title, or 

interest of the conservator or receiver for the Corporation in any asset acquired 

by the conservator or receiver as conservator or receiver for the Corporation shall 

be valid against the conservator or receiver unless the agreement—

(1) is in writing;

(2) is executed by the Corporation and any person claiming an 

adverse interest under the agreement, including the obligor, 

contemporaneously with the acquisition of the asset by the Corporation;

(3) is approved by the Board or an appropriate committee of the 

Board, which approval shall be reflected in the minutes of the Board or 

committee; and

(4) has been, continuously, from the time of the agreement's 

execution, an official record of the Corporation.

(h) REPORT TO THE CONGRESS. On a determination by the receiver 

for the Corporation that there are insufficient assets of the receivership to pay all 
valid claims against the receivership, the receiver shall submit to the Secretary of 

the Treasury, the Committee on Agriculture of the House of Representatives, and 

the Committee on Agriculture, Nutrition, and Forestry of the Senate a report on 

the financial condition of the receivership.

(i) TERMINATION OF AUTHORITIES.

(1) CORPORATION. The charter of the Corporation shall be 

canceled, and the authority provided to the Corporation by this title shall 

terminate, on such date as the Farm Credit Administration Board 

determines is appropriate following the placement of the Corporation in 

receivership, but not later than the conclusion of the receivership and 

discharge of the receiver.

(2) OVERSIGHT. The Office of Secondary Market Oversight 

established under section 8.11 shall be abolished, and section 8.11(a) and 

subtitle B shall have no force or effect, on such date as the Farm Credit 

Administration Board determines is appropriate following the placement of 

the Corporation in receivership, but not later than the conclusion of the 

receivership and discharge of the receiver.
Type: Statute

Statute: ADDITIONAL PROVISIONS OF PUBLIC LAW 99-509

Title: Title I Agricultural Programs

Part: [Part]

Subtitle: Subtitle A Sale of Notes

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 1929a note

Date Created: 12/31/2012

Date Modified: 2/15/2018

ADDITIONAL PROVISIONS OF PUBLIC LAW 99-509

(OCTOBER 21, 1986)

TITLE I—AGRICULTURAL PROGRAMS

Subtitle A—Sale of Notes

7 U.S.C. 1929a note SEC. 1001. SALE OF RURAL DEVELOPMENT NOTES.

* * * * *

(d) ELIGIBILITY TO PURCHASE NOTES. Notwithstanding any 

other provision of law, each institution of the Farm Credit System shall be 

eligible to purchase notes and other obligations held in the Rural Development 

Insurance Fund and to service (including the extension of additional credit and all 

other actions necessary to preserve, conserve, or protect the institution's interest 

in the purchased notes or other obligations), collect, and dispose of such notes 

and other obligations, subject only to such terms and conditions as may be agreed 

to by the Secretary of Agriculture and the purchasing institution and as may be 

approved by the Farm Credit Administration.
Type: Statute

Statute: TITLE 12 UNITED STATES CODE

Title: Title 12 United States Code

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: Banks and Banking

U.S. Code Citation 12 U.S.C. 

Date Created: 12/31/2012

Date Modified: 2/15/2018

TITLE 12—UNITED STATES CODE

Banks and Banking

* * * * *

SEC. 1786. TERMINATION OF INSURED CREDIT UNION 

STATUS; CEASE AND DESIST ORDERS; REMOVAL OR SUSPENSION 

FROM OFFICE; PROCEDURE. 

* * * * *

(g) REMOVAL OF DIRECTOR, OFFICER, COMMITTEE MEMBER, 

OR EMPLOYEE; NOTICE; HEARING; JUDICIAL REVIEW; EFFECT OF

REMOVAL OR SUSPENSION.

(7) INDUSTRYWIDE PROHIBITION.

(A) IN GENERAL. Except as provided in subparagraph (B), 

any person who, pursuant to an order issued under this subsection or 

subsection (i), has been removed or suspended from office in an 

insured credit union or prohibited from participating in the conduct 

of the affairs of an insured credit union may not, while such order is 

in effect, continue or commence to hold any office in, or participate 

in any manner in the conduct of the affairs of—

(i) any insured depository institution;

(ii) any institution treated as an insured bank under 

paragraph (3) or (4) of section 8(b) of the Federal Deposit 

Insurance Act, or as a savings association under section 8(b)(8) 

of such Act;

(iii) any insured credit union;

(iv) any institution chartered under the Farm Credit 

Act of 1971;

(v) any appropriate Federal depository institution 

regulatory agency;

(vi) the Federal Housing Finance Board and any 

Federal home loan bank; and

(vii) the Resolution Trust Corporation.

(B) EXCEPTION IF AGENCY PROVIDES WRITTEN 

CONSENT. If, on or after the date an order is issued under this 

subsection which removes or suspends from office any institution-
affiliated party or prohibits such party from participating in the 

conduct of the affairs of an insured credit union, such party receives 

the written consent of—

(i) the Board; and

(ii) the appropriate Federal financial institutions 

regulatory agency of the institution described in any clause of 

subparagraph (A) with respect to which such party proposes to 

become an institution-affiliated party, 

subparagraph (A) shall, to the extent of such consent, cease to apply to such party 

with respect to the institution described in each written consent. If any person 

receives such a written consent from the Board, the Board shall publicly disclose 

such consent. If the agency referred to in clause (ii) grants such a written consent, 

such agency shall report such action to the Board and publicly disclose such 

consent.

(C) VIOLATION OF PARAGRAPH TREATED AS 

VIOLATION OF ORDER. Any violation of subparagraph (A) by 

any person who is subject to an order described in such subparagraph 

shall be treated as a violation of the order.

(D) APPROPRIATE FEDERAL FINANCIAL 

INSTITUTIONS REGULATORY AGENCY DEFINED. For 

purposes of this paragraph and subsection (1), the term "appropriate 

Federal financial institutions regulatory agency" means—

(i) the appropriate Federal banking agency, as 

provided in section 3(q) of the Federal Deposit Insurance Act;

(ii) the Farm Credit Administration, in the case of an 

institution chartered under the Farm Credit Act of 1971;

(iii) the National Credit Union Administration Board, 

in the case of an insured credit union (as defined in section 

101(7) of the Federal Credit Union Act);

(iv) the Secretary of the Treasury, in the case of the 

Federal Housing Finance Board and any Federal home loan 

bank; and

(v) the Oversight Board, in the case of the Resolution 

Trust Corporation.

(E) CONSULTATION BETWEEN AGENCIES. The 

agencies referred to in clauses (i) and (ii) of subparagraph (B) shall 

consult with each other before providing any written consent 

described in subparagraph (B).

(F) APPLICABILITY. This paragraph shall only apply to a 

person who is an individual, unless the Board specifically finds that 

it should apply to a corporation, firm, or other business enterprise.

* * * * *

(l) CRIMINAL PENALTY FOR VIOLATION OF CERTAIN 

ORDERS.

Whoever—

(1) under this Act, is suspended or removed from, or prohibited 

from participating in the affairs of any credit union described in section 

206(g)(5); and
(2) knowingly participates, directly or indirectly, in any manner 

(including by engaging in an activity specifically prohibited in such an 

order or in subsection (g)(5) in the conduct of the affairs of such a credit 

union;

shall be fined not more than $1,000,000, imprisoned for not more than 5 years, or 

both.

* * * * *
Type: Statute

Statute: TITLE 12 UNITED STATES CODE

Title: Title 12 United States Code

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 

Date Created: 12/31/2012

Date Modified: 2/15/2018

SEC. 1818. TERMINATION OF STATUS AS INSURED BANK.

* * * * *

(e) SUSPENSION OR REMOVAL OF DIRECTOR OR OFFICER.

* * * * *

(7) INDUSTRYWIDE PROHIBITION.

(A) IN GENERAL. Except as provided in subparagraph (B), 

any person who, pursuant to an order issued under this subsection or 

subsection (g), has been removed or suspended from office in an 

insured depository institution or prohibited from participating in the 

conduct of the affairs of an insured depository institution may not, 

while such order is in effect, continue or commence to hold any 

office in, or participate in any manner in the conduct of the affairs 

of—

(i) any insured depository institution; 

(ii) any institution treated as an insured bank under 

subsection (b)(3) or (b)(4), or as a savings association under 

subsection (b)(8);

(iii) any insured credit union under the Federal Credit 

Union Act;

(iv) any institution chartered under the Farm Credit 

Act of 1971;

(v) any appropriate Federal depository institution 

regulatory agency;

(vi) the Federal Housing Finance Board and any 

Federal home loan bank; and

(vii) the Resolution Trust Corporation.

(B) EXCEPTION IF AGENCY PROVIDES WRITTEN 

CONSENT. If, on or after the date an order is issued under this 

subsection which removes or suspends from office any institutionaffiliated party or prohibits such party from participating in the 

conduct of the affairs of an insured depository institution, such party 

receives the written consent of—

(i) the agency that issued such order; and

(ii) the appropriate Federal financial institutions 

regulatory agency of the institution described in any clause of 
subparagraph (A) with respect to which such party proposes to 

become an institution-affiliated party,

subparagraph (A) shall, to the extent of such consent, cease to apply to such party 

with respect to the institution described in each written consent. Any agency that 

grants such a written consent shall report such action to the Corporation and 

publicly disclose such consent.

(C) VIOLATION OF PARAGRAPH TREATED AS 

VIOLATION OF ORDER. Any violation of subparagraph (A) by 

any person who is subject to an order described in such subparagraph 

shall be treated as a violation of the order.

(D) APPROPRIATE FEDERAL FINANCIAL 

INSTITUTIONS REGULATORY AGENCY DEFINED. For 

purposes of this paragraph and subsection (j), the term "appropriate 

Federal financial institutions regulatory agency" means—

(i) the appropriate Federal banking agency, in the 

case of an insured depository institution;

(ii) the Farm Credit Administration, in the case of an 

institution chartered under the Farm Credit Act of 1971;

(iii) the National Credit Union Administration Board, 

in the case of an insured credit union (as defined in section 

101(7) of the Federal Credit Union Act);

(iv) the Secretary of the Treasury, in the case of the 

Federal Housing Finance Board and any Federal home loan 

bank; and

(v) the Oversight Board, in the case of the Resolution 

Trust Corporation.

(E) CONSULTATION BETWEEN AGENCIES. The 

agencies referred to in clauses (i) and (ii) of subparagraph (B) shall 

consult with each other before providing any written consent 

described in subparagraph (B).

(F) APPLICABILITY. This paragraph shall only apply to a 

person who is an individual, unless the appropriate Federal banking 

agency specifically finds that it should apply to a corporation, firm, 

or other business enterprise.

* * * * *

(j) CRIMINAL PENALTY. Whoever, being subject to an order in 

effect under subsection (e) or (g), without the prior written approval of the 

appropriate Federal financial institutions regulatory agency, knowingly 

participates, directly or indirectly, in any manner (including by engaging in an 

activity specifically prohibited in such an order or in subsection (e)(6) in the 

conduct of the affairs of—

(1) any insured depository institution;

(2) any institution treated as an insured bank under subsection 

(b)(3) or (b)(4), or as a savings association under subsection (b)(8);

(3) any insured credit union (as defined in section 101(7) of the 

Federal Credit Union Act);

(4) any institution chartered under the Farm Credit Act of 1971; or

(5) the Resolution Trust Corporation, 
shall be fined not more than $1,000,000, imprisoned for not more than 5 years, or 

both.

* * * * *
Type: Statute

Statute: TITLE 12 UNITED STATES CODE

Title: Title 12 United States Code

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: Banks and Banking

U.S. Code Citation 12 U.S.C. 

Date Created: 12/31/2012

Date Modified: 2/15/2018

SEC. 1821. INSURANCE FUNDS.

* * * * *

(t) Agencies may share information without waiving privilege

 (1) IN GENERAL. A covered agency shall not be deemed to have waived 

any privilege applicable to any information by transferring that information to or 

permitting that information to be used by--

 (A) any other covered agency, in any capacity; or

 (B) any other agency of the Federal Government (as defined in 

section 6 of title 18).

(2) DEFINITIONS.--

 For purposes of this subsection:

 (A) COVERED AGENCY.--

 The term ''covered agency'' means any of the following:

 (i) Any appropriate Federal banking agency.

 (ii) The Resolution Trust Corporation.

 (iii) The Farm Credit Administration.

 (iv) The Farm Credit System Insurance Corporation.

 (v) The National Credit Union Administration.

 (vi) The General Accounting Office.

 (B) PRIVILEGE.--

 The term ''privilege'' includes any work-product, attorney-client, or 

other privilege recognized under Federal or State law.

 (3) RULE OF CONSTRUCTION.--

 Paragraph (1) shall not be construed as implying that any person 

waives any privilege applicable to any information because paragraph (1) does 

not apply to the transfer or use of that information.

* * * * *
Type: Statute

Statute: TITLE 12 UNITED STATES CODE

Title: Title 12 United States Code

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: Banks and Banking

U.S. Code Citation 12 U.S.C. 

Date Created: 12/31/2012

Date Modified: 2/15/2018

SEC. 2276. ACCESS TO AND EXAMINATION BY 

COMPTROLLER GENERAL OF BOOKS, DOCUMENTS, ETC. OF 

FARM CREDIT SYSTEM BANKS AND INSTITUTIONS.

On and after December 19, 1985, the Comptroller General or his duly 

authorized representatives shall have access to and the right to examine all books, 

documents, papers, records, or other recorded information within the possession 

or control of the Federal land banks and Federal land bank associations, Federal 

intermediate credit banks and production credit associations and banks for 

cooperatives. [This section was added by the Furthering Continuing 

Appropriations, 1985, P.L. 99-190, Title I, § 107, Dec. 19, 1985, 99 Stat. 1316.]

* * * * *
Type: Statute

Statute: TITLE 12 UNITED STATES CODE

Title: Title 12 United States Code

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: Banks and Banking

U.S. Code Citation 12 U.S.C. 

Date Created: 12/31/2012

Date Modified: 2/15/2018

SEC. 3025. EXAMINATION AND AUDIT.

The Farm Credit Administration and the General Accounting Office are 

hereby authorized and directed to examine and audit the Bank. Reports 

regarding such examinations and audits shall be promptly forwarded to both 

Houses of the Congress. The Bank shall reimburse the Farm Credit 

Administration for the costs of any examination or audit conducted by the Farm 

Credit Administration. (Pub. L. 95-351, Title I, § 115, Aug. 20, 1978, 92 Stat. 

511; Pub. L. 97-35, Title III, § 394(a)(1), Aug. 13, 1981, 95 Stat. 436.)

* * * * *
Type: Statute

Statute: PUBLIC LAW 101-220

Title: No Title

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 1178b-9 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

PUBLIC LAW 101-220

* * * * *

12 U.S.C. 1178b-9 note SEC. 7. PURCHASES OF FINANCIAL ASSISTANCE 

CORPORATION STOCK BY FARM CREDIT SYSTEM INSTITUTIONS.

* * * * *

(b) PAYMENTS.

(1) FOUR ANNUAL PAYMENTS. Notwithstanding any other 

provision of law, the Financial Assistance Corporation shall pay, out of the 

Financial Assistance Corporation Trust Fund (hereinafter in this section 

referred to as the "Trust Fund") established under section 6.25(b) of the 

Farm Credit Act of 1971 (12 U.S.C. 2278b5(b)), to each of the institutions 

of the Farm Credit System that purchased stock in the Financial Assistance 

Corporation under section 6.29 of the Farm Credit Act of 1971, four annual 

payments as provided in this section.

(2) TIMING OF PAYMENTS. The annual payments provided for 

by this subsection shall be made available as soon as practicable after 

October 1 of each of the calendar years 1989 through 1992.

(3) CALCULATION OF FIRST PAYMENT. The first annual 

payment made available under this subsection shall be in an amount equal 

to—

(A) a percentage equal to 1.5 times the average rate of 

interest received by the Financial Assistance Corporation on assets of 

the Trust Fund from March 30, 1988, through September 30, 1989; 

times

(B) the difference between $177,000,000 and 4.4 percent of 

the cumulative amount of the bonds issued by the Financial 

Assistance Corporation through September 30, 1989.

(4) CALCULATION OF REMAINING PAYMENTS. The 

second, third, and fourth annual payments made available under this 

subsection shall be in the amount equal to—

(A) a percentage equal to the average rate of interest 

received by the Financial Assistance Corporation on assets of the 

Trust Fund during each of the fiscal years 1990 through 1992; times

(B) the difference between $177,000,000 and 4.4 percent of 

the cumulative amount of the bonds issued by the Financial 
Assistance Corporation through September 30 of each of such fiscal 

years.

(5) DISTRIBUTION OF ANNUAL PAYMENTS. Annual 

payments due under this subsection shall be made available to each 

institution described in paragraph (1) in an amount equal to the total 

amount of annual payments to be made available times the ratio of the 

amount of stock each institution purchased divided by $177,000,000.

Note: Pub. L. 101-239, section 1006, December 19, 1989, contains a 

statutory provision that is identical to this section 7(b) of Pub. L. 101-

220.
Type: Statute

Statute: PUBLIC LAW 101-220

Title: No Title

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 2 U.S.C. 905(g)(1)(A)

Date Created: 12/31/2012

Date Modified: 2/15/2018

2 U.S.C. 905 (g)(1)(A) SEC. 8. EXEMPTION OF CERTAIN INTEREST PAYMENTS BY 

THE UNITED STATES TREASURY FROM SEQUESTRATION.

Section 255(g)(1)(A) of the Balanced Budget and Emergency Deficit 

Control Act of 1985 (2 U.S.C. 905(g)(1)(A)) is amended by inserting "Farm 

Credit System Financial Assistance Corporation, interest payments 

(20185001351);" after "Exchange stabilization fund (20-4444-0-3-155);."

* * * * *
Type: Statute

Statute: TERRORISM RISK INSURANCE PROGRAM REAUTHORIZATION 

ACT OF 2015

Title: Title III Business Risk Mitigation and Price Stabilization

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/7/2017

Date Modified: 2/15/2018

Terrorism Risk Insurance Program Reauthorization Act of 2015

* * * * *

TITLE III—BUSINESS RISK MITIGATION AND PRICE STABILIZATION

* * * * *

SEC. 301. SHORT TITLE.

This title may be cited as the ‘‘Business Risk Mitigation and Price 

Stabilization Act of 2015’’.

SEC. 302. MARGIN REQUIREMENTS.

(a) COMMODITY EXCHANGE ACT AMENDMENT.—Section 4s(e) 

of the Commodity Exchange Act (7 U.S.C. 6s(e)), as added by section 731 of the 

Dodd-Frank Wall Street Reform and Consumer Protection Act, is amended by 

adding at the end the following new paragraph:

‘‘(4) APPLICABILITY WITH RESPECT TO 

COUNTERPARTIES.—The requirements of paragraphs (2)(A)(ii) and 

(2)(B)(ii), including the initial and variation margin requirements

imposed by rules adopted pursuant to paragraphs (2)(A)(ii)

and (2)(B)(ii), shall not apply to a swap in which a counterparty

qualifies for an exception under section 2(h)(7)(A), or an exemption

issued under section 4(c)(1) from the requirements of section

2(h)(1)(A) for cooperative entities as defined in such exemption,

or satisfies the criteria in section 2(h)(7)(D).’’.

(b) SECURITIES EXCHANGE ACT AMENDMENT.—Section 15F(e)

of the Securities Exchange Act of 1934 (15 U.S.C. 78o–10(e)), as

added by section 764(a) of the Dodd-Frank Wall Street Reform

and Consumer Protection Act, is amended by adding at the end

the following new paragraph:

‘‘(4) APPLICABILITY WITH RESPECT TO 

COUNTERPARTIES.—The requirements of paragraphs (2)(A)(ii) and 

(2)(B)(ii) shall not apply to a security-based swap in which a 

counterparty qualifies for an exception under section 3C(g)(1) or satisfies

the criteria in section 3C(g)(4).’’.

SEC. 303. IMPLEMENTATION.
The amendments made by this title to the Commodity Exchange

Act shall be implemented—

(1) without regard to—

(A) chapter 35 of title 44, United States Code; and

(B) the notice and comment provisions of section 553

of title 5, United States Code;

(2) through the promulgation of an interim final rule,

pursuant to which public comment will be sought before a

final rule is issued; and

(3) such that paragraph (1) shall apply solely to changes

to rules and regulations, or proposed rules and regulations,

that are limited to and directly a consequence of such amendments.
Type: Statute

Statute: AGRICULTURAL ACT OF 2014

Title: Title V Credit

Part: [Part]

Subtitle: Subtitle E Miscellaneous

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2252 note

Date Created: 8/7/2017

Date Modified: 2/15/2018

Agricultural Act of 2014

* * * * *

TITLE V—CREDIT

* * * * *

Subtitle E—Miscellaneous

* * * * *

12 USC 2252 note SEC. 5404. COMPENSATION DISCLOSURE BY FARM CREDIT 

SYSTEM INSTITUTIONS.

(a) FINDINGS.—Congress finds that —

(1) the reasonable disclosure to stockholders by Farm

Credit System institutions regarding the compensation of Farm

Credit System institution senior officers is beneficial to 

stockholders’ understanding of the operation of their institutions;

(2) transparency regarding compensation practices

reinforces the cooperative nature of Farm Credit System 

institutions;

(3) the unique cooperative structure of the Farm Credit

System should be considered when promulgating rules;

(4) the participation of stockholders in the election of the

boards of directors of Farm Credit System institutions provides

stockholders the opportunity to participate in the management

of their institutions;

(5) as representatives of stockholders, the boards of 

directors of Farm Credit System institutions importantly 

establish and oversee the compensation practices of Farm Credit 

System institutions to ensure the safe and sound operation of 

those institutions; and

(6) any regulation should strengthen and not hinder the

ability of Farm Credit System boards of directors to oversee

compensation practices.

(b) IMPLEMENTATION.—Not later than 60 days after the date

of enactment of this Act, the Farm Credit Administration shall
review its rules to reflect Congressional intent that a primary

responsibility of the boards of directors of Farm Credit System

institutions, as elected representatives of their stockholders, is to

oversee compensation practices.

Note: Section 5404 of the Agricultural Credit Act of 2014 modifies section 514 of the Farm Credit 

Banks and Association Safety and Soundness Act of 1992, Pub. L. 102-552, § 514, 106 Stat 4102, 

4134 (Oct. 28, 1992).
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [01] Title I Financial Stability

Part: Part I

Subtitle: Definitions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5311

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART I

TITLE I—FINANCIAL STABILITY

12 U.S.C. 5311 SEC. 102. DEFINITIONS.

(a) IN GENERAL.—For purposes of this title, unless the context

otherwise requires, the following definitions shall apply:

* * * * *

(4) NONBANK FINANCIAL COMPANY 

DEFINITIONS. 

* * * * *

(B) U.S. NONBANK FINANCIAL 

COMPANY.—The term ‘‘U.S. nonbank financial 

company’’ means a company (other than a bank holding 

company, a Farm Credit System institution chartered and 

subject to the provisions of the Farm Credit Act of 1971 

(12 U.S.C. 2001 et seq.), or a national securities 

exchange (or parent thereof), clearing agency (or parent 

thereof, unless the parent is a bank holding company), 

security-based swap execution facility, or security-based 

swap data repository registered with the Commission, or 

a board of trade designated as a contract market (or 

parent thereof), or a derivatives clearing organization (or 

parent thereof, unless the parent is a bank holding 

company), swap execution facility or a swap data 

repository registered with the Commodity Futures

Trading Commission), that is—

(i) incorporated or organized under the 

laws of the United States or any State; and

(ii) predominantly engaged in financial 

activities, as defined in paragraph (6).
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [02] Title II Orderly Liquidation Authority

Part: Part I

Subtitle: Definitions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5381

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART I

TITLE II—ORDERLY LIQUIDATION AUTHORITY

12 U.S.C. 5381 SEC. 201. DEFINITIONS.

* * * * *

(a) IN GENERAL.—In this title, the following definitions 

shall apply:

* * * * *

(11) FINANCIAL COMPANY.—The term 

‘‘financial company’’ means any company that—

(A) is incorporated or organized under any 

provision of Federal law or the laws of any State;

* * * * *

(C) is not a Farm Credit System institution 

chartered under and subject to the provisions of the 

Farm Credit Act of 1971, as amended (12 U.S.C. 

2001 et seq.), a governmental entity, or a regulated 

entity, as defined under section 1303(20) of the 

Federal Housing Enterprises Financial Safety and 

Soundness Act of 1992 (12 U.S.C. 4502(20)).
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION

ACT

Title: [03] Title VI Improvements to Regulation of Bank and Savings 

Association Holding Companies and Depository Institutions

Part: Part I

Subtitle: Prohibitions on Propriety Trading and Certain Relationships with Hedge 

Funds and Private Equity Funds

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 1851

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART I

TITLE VI—IMPROVEMENTS TO REGULATION

OF BANK AND SAVINGS ASSOCIATION

HOLDING COMPANIES AND DEPOSITORY INSTITUTIONS

* * * * *

12 U.S.C. 1851 SEC. 619. PROHIBITIONS ON PROPRIETARY 

TRADING AND CERTAIN RELATIONSHIPS WITH 

HEDGE FUNDS AND PRIVATE EQUITY FUNDS.

The Bank Holding Company Act of 1956 (12 U.S.C. 1841 

et seq.) is amended by adding at the end the following:

‘‘SEC. 13. PROHIBITIONS ON PROPRIETARY 

TRADING AND CERTAIN RELATIONSHIPS WITH 

HEDGE FUNDS AND PRIVATE EQUITY FUNDS.

 * * * * *

‘‘(d) PERMITTED ACTIVITIES.—

‘‘(1) IN GENERAL.—Notwithstanding the 

restrictions under subsection (a), to the extent 

permitted by any other provision of Federal or State 

law, and subject to the limitations under paragraph 

(2) and any restrictions or limitations that the 

appropriate Federal banking agencies, the Securities 

and Exchange Commission, and the Commodity 

Futures Trading Commission, may determine, the 

following activities (in this section referred to as 

‘permitted activities’) are permitted:
‘‘(A) The purchase, sale, acquisition, 

or disposition of obligations of the United 

States or any agency thereof, obligations, 

participations, or other instruments of or 

issued by the Government National 

Mortgage Association, the Federal National 

Mortgage Association, the Federal Home

Loan Mortgage Corporation, a Federal 

Home Loan Bank, the Federal Agricultural 

Mortgage Corporation, or a Farm Credit 

System institution chartered under and 

subject to the provisions of the Farm Credit 

Act of 1971 (12 U.S.C. 2001 et seq.), and 

obligations of any State or of any political

subdivision thereof.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [04] Title VII Wall Street Transparency and Accountability

Part: Part II Regulation of Swap Markets

Subtitle: Definitions

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 1a

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE VII—WALL STREET TRANSPARENCY AND ACCOUNTABILITY

7 U.S.C. 1a SEC. 721. DEFINITIONS.

(a) IN GENERAL.—Section 1a of the Commodity Exchange 

Act (7 U.S.C. 1a) is amended—

* * * * *

(2) by inserting after paragraph (1) the following:

‘‘(2) APPROPRIATE FEDERAL BANKING 

AGENCY.—The term ‘appropriate Federal banking agency’—

‘‘(A) has the meaning given the term in section 

3 of the Federal Deposit Insurance Act (12 U.S.C. 1813);

‘‘(B) means the Board in the case of a 

noninsured State bank; and

‘‘(C) is the Farm Credit Administration for farm 

credit system institutions.

* * * * *

‘‘(39) PRUDENTIAL REGULATOR.—The term 

‘prudential regulator’ means—

* * * * *

‘‘(D) the Farm Credit Administration, in the 

case of a swap dealer, major swap participant, securitybased swap dealer, or major security-based swap 

participant that is an institution chartered under the Farm 

Credit Act of 1971 (12 U.S.C. 2001 et seq.);
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [04] Title VII Wall Street Transparency and Accountability

Part: Part II Regulation of Swap Markets

Subtitle: Clearing

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 2

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE VII—WALL STREET TRANSPARENCY AND ACCOUNTABILITY

7 U.S.C. 2 SEC. 723. CLEARING.

* * * * *

‘‘(h) CLEARING REQUIREMENT.—

‘‘(1) IN GENERAL.—

‘‘(A) STANDARD FOR CLEARING.—It 

shall be unlawful for any person to engage in a

swap unless that person submits such swap for 

clearing to a derivatives clearing organization that is 

registered under this Act or a derivatives clearing 

organization that is exempt from registration under 

this Act if the swap is required to be cleared.

* * * * *

‘‘(7) EXCEPTIONS.—

‘‘(A) IN GENERAL.—The requirements of 

paragraph (1)(A) shall not apply to a swap if 1 of 

the counterparties to the swap—

‘‘(i) is not a financial entity;

‘‘(ii) is using swaps to hedge or 

mitigate commercial risk; and

‘‘(iii) notifies the Commission, in a 

manner set forth by the Commission, how it 

generally meets its financial obligations 

associated with entering into noncleared

swaps.
‘‘(B) OPTION TO CLEAR.—The 

application of the clearing exception in 

subparagraph (A) is solely at the discretion

of the counterparty to the swap that meets 

the conditions of clauses (i) through (iii) of 

subparagraph (A).

‘‘(C) FINANCIAL ENTITY 

DEFINITION.—

‘‘(i) IN GENERAL.—For the 

purposes of this paragraph, the term 

‘financial entity’ means—

* * * * *

‘‘(VIII) a person 

predominantly engaged in

activities that are in the business of 

banking, or in activities that are 

financial in nature, as defined

in section 4(k) of the Bank Holding 

Company Act of 1956.

‘‘(ii) EXCLUSION.—The 

Commission shall consider whether to 

exempt small banks, savings associations,

farm credit system institutions, and credit 

unions, including—

‘‘(I) depository institutions 

with total assets of $10,000,000,000 

or less;

‘‘(II) farm credit system 

institutions with total assets of 

$10,000,000,000 or less; or

‘‘(III) credit unions with total 

assets of $10,000,000,000 or less.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [04] Title VII Wall Street Transparency and Accountability

Part: Part II Regulation of Swap Markets

Subtitle: Registration and Regulation of Swap Dealers and Major Swap 

Participants

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 6s

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE VII—WALL STREET TRANSPARENCY AND ACCOUNTABILITY

7 U.S.C. 6s SEC. 731. REGISTRATION AND REGULATION OF SWAP 

DEALERS AND MAJOR SWAP PARTICIPANTS.

* * * * *

‘‘SEC. 4s. REGISTRATION AND REGULATION OF SWAP 

DEALERS AND MAJOR SWAP PARTICIPANTS.

* * * * *

‘‘(d) RULEMAKINGS.—

‘‘(1) IN GENERAL.—The Commission shall adopt 

rules for persons that are registered as swap dealers or 

major swap participants under this section.

‘‘(2) EXCEPTION FOR PRUDENTIAL 

REQUIREMENTS.—

‘‘(A) IN GENERAL.—The Commission 

may not prescribe rules imposing prudential 

requirements on swap dealers or major swap 

participants for which there is a prudential

regulator.

* * * * *

‘‘(e) CAPITAL AND MARGIN REQUIREMENTS.—

‘‘(1) IN GENERAL.—

‘‘(A) SWAP DEALERS AND MAJOR 

SWAP PARTICIPANTS THAT ARE BANKS.—
Each registered swap dealer and major swap 

participant for which there is a prudential regulator

shall meet such minimum capital requirements and 

minimum initial and variation margin requirements 

as the prudential regulator shall by rule or 

regulation prescribe under paragraph (2)(A).

‘‘(B) SWAP DEALERS AND MAJOR 

SWAP PARTICIPANTS THAT ARE NOT 

BANKS.—Each registered swap dealer and

major swap participant for which there is not a 

prudential regulator shall meet such minimum 

capital requirements and minimum initial and 

variation margin requirements as the Commission 

shall by rule or regulation prescribe under 

paragraph (2)(B).

‘‘(2) RULES.—

‘‘(A) SWAP DEALERS AND MAJOR 

SWAP PARTICIPANTS THAT ARE BANKS.—

The prudential regulators, in consultation with the 

Commission and the Securities and Exchange

Commission, shall jointly adopt rules for swap 

dealers and major swap participants, with respect to 

their activities as a swap dealer or major swap 

participant, for which there is a prudential regulator 

imposing—

‘‘(i) capital requirements; and

‘‘(ii) both initial and variation 

margin requirements on all swaps that are 

not cleared by a registered derivatives

clearing organization.

‘‘(B) SWAP DEALERS AND MAJOR 

SWAP PARTICIPANTS THAT ARE NOT 

BANKS.—The Commission shall adopt rules

for swap dealers and major swap participants, with 

respect to their activities as a swap dealer or major 

swap participant, for which there is not a prudential 

regulator imposing—

‘‘(i) capital requirements; and

‘‘(ii) both initial and variation 

margin requirements on all swaps that are 

not cleared by a registered derivatives

clearing organization.

‘‘(C) CAPITAL.—In setting capital 

requirements for a person that is designated as a 

swap dealer or a major swap participant for a single 

type or single class or category of swap or activities, 
the prudential regulator and the Commission shall 

take into account the risks associated with other 

types of swaps or classes of swaps or categories

of swaps engaged in and the other activities 

conducted by that person that are not otherwise 

subject to regulation applicable to that person by 

virtue of the status of the person as a swap dealer or 

a major swap participant.

‘‘(3) STANDARDS FOR CAPITAL AND 

MARGIN.—

‘‘(A) IN GENERAL.—To offset the greater 

risk to the swap dealer or major swap participant 

and the financial system arising from the use of 

swaps that are not cleared, the requirements 

imposed under paragraph (2) shall—

‘‘(i) help ensure the safety and 

soundness of the swap dealer or major swap 

participant; and

‘‘(ii) be appropriate for the risk 

associated with the non-cleared swaps held 

as a swap dealer or major swap participant.

* * * * *

‘‘(C) MARGIN REQUIREMENTS.—In 

prescribing margin requirements under this 

subsection, the prudential regulator with respect to 

swap dealers and major swap participants for which 

it is the prudential regulator and the Commission

with respect to swap dealers and major swap

participants for which there is no prudential 

regulator shall permit the use of noncash collateral, 

as the regulator or the Commission determines to be 

consistent with—

‘‘(i) preserving the financial integrity 

of markets trading swaps; and

‘‘(ii) preserving the stability of the 

United States financial system.

‘‘(D) COMPARABILITY OF CAPITAL 

AND MARGIN REQUIREMENTS.—

‘‘(i) IN GENERAL.—The prudential 

regulators, the Commission, and the 

Securities and Exchange Commission shall 

periodically (but not less frequently than 

annually) consult on minimum capital 

requirements and minimum initial and 

variation margin requirements.
‘‘(ii) COMPARABILITY.—The 

entities described in clause (i) shall, to the 

maximum extent practicable, establish and 

maintain comparable minimum capital

requirements and minimum initial and 

variation margin requirements, including the 

use of non cash collateral, for—

‘‘(I) swap dealers; and

‘‘(II) major swap 

participants.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [04] Title VII Wall Street Transparency and Accountability

Part: Part II Regulation of Swap Markets

Subtitle: Retail Commodity Transactions

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE VII—WALL STREET TRANSPARENCY AND ACCOUNTABILITY

SEC. 742. RETAIL COMMODITY TRANSACTIONS.

(a) IN GENERAL.—Section 2(c) of the Commodity 

Exchange Act (7 U.S.C. 2(c)) is amended—

(1) in paragraph (1), by striking ‘‘5a (to the extent 

provided in section 5a(g)), 5b, 5d, or 12(e)(2)(B))’’ and 

inserting ‘‘, 5b, or 12(e)(2)(B))’’; and

(2) in paragraph (2), by adding at the end the 

following:

‘‘(D) RETAIL COMMODITY 

TRANSACTIONS.—

‘‘(i) APPLICABILITY.—Except as 

provided in clause (ii), this subparagraph 

shall apply to any agreement, contract, or 

transaction in any commodity that is—

‘‘(I) entered into with, or 

offered to (even if not entered into 

with), a person that is not an

eligible contract participant or 

eligible commercial entity; and

‘‘(II) entered into, or offered 

(even if not entered into), on a 

leveraged or margined basis,

or financed by the offeror, the 

counterparty, or a person acting in 

concert with the offeror or

counterparty on a similar basis.

‘‘(ii) EXCEPTIONS.—This 

subparagraph shall not apply to—
‘‘(I) an agreement, contract, 

or transaction described in paragraph 

(1) or subparagraphs (A), (B), or (C), 

including any agreement, contract, or

transaction specifically excluded 

from subparagraph (A), (B), or (C);

‘‘(II) any security;

‘‘(III) a contract of sale 

that—

‘‘(aa) results in actual 

delivery within 28 days or 

such other longer period as 

the Commission may 

determine by rule or 

regulation based upon the 

typical commercial practice

in cash or spot markets for 

the commodity involved; or

‘‘(bb) creates an 

enforceable obligation to

deliver between a seller and a 

buyer that have the ability to 

deliver and accept delivery,

respectively, in connection 

with the line of business of 

the seller and buyer; or

‘‘(IV) an agreement, 

contract, or transaction that is listed 

on a national securities exchange

registered under section 6(a) of the 

Securities Exchange Act of 1934 (15 

U.S.C. 78f(a)); or

‘‘(V) an identified banking 

product, as defined in section 402(b) 

of the Legal Certainty for Bank

Products Act of 2000 (7

U.S.C.27(b)).

‘‘(iii) ENFORCEMENT.—Sections 

4(a), 4(b), and 4b apply to any agreement, 

contract, or transaction described in clause 

(i), as if the agreement, contract, or 

transaction was a contract of sale of a 

commodity for future delivery.

‘‘(iv) ELIGIBLE COMMERCIAL 

ENTITY.—For purposes of this 

subparagraph, an agricultural producer, 
packer, or handler shall be considered to be 

an eligible commercial entity for any 

agreement, contract, or transaction

for a commodity in connection with the line 

of business of the agricultural producer, 

packer, or handler.’’.

* * * * *

(c) CONFORMING AMENDMENTS RELATING TO 

RETAIL FOREIGN EXCHANGE TRANSACTIONS.—

(1) Section 2(c)(2)(B)(i)(II) of the Commodity 

Exchange Act (7 U.S.C. 2(c)(2)(B)(i)(II)) is amended—

(A) in item (aa), by inserting ‘‘United 

States’’ before ‘‘financial institution’’;

(B) by striking items (dd) and (ff);

(C) by redesignating items (ee) and (gg) as 

items (dd) and (ff), respectively; and

(D) in item (dd) (as so redesignated), by 

striking the semicolon and inserting ‘‘; or’’.

(2) Section 2(c)(2) of the Commodity Exchange Act 

(7 U.S.C. 2(c)(2)) (as amended by subsection (a)(2)) is 

amended by adding at the end the following:

‘‘(E) PROHIBITION.—

‘‘(i) DEFINITION OF FEDERAL 

REGULATORY AGENCY.—In this 

subparagraph, the term ‘Federal

regulatory agency’ means—

‘‘(I) the Commission;

‘‘(II) the Securities and 

Exchange Commission;

‘‘(III) an appropriate Federal 

banking agency;

‘‘(IV) the National Credit 

Union Association; and

‘‘(V) the Farm Credit 

Administration.

‘‘(ii) PROHIBITION.—

‘‘(I) IN GENERAL.—Except 

as provided in subclause (II), a 

person described in subparagraph

(B)(i)(II) for which there is a Federal 

regulatory agency shall not offer to, 

or enter into with, a person that is not 

an eligible contract participant,

any agreement, contract, or 

transaction in foreign currency 
described in subparagraph (B)(i)(I) 

except pursuant to a rule or 

regulation of a Federal regulatory

agency allowing the agreement, 

contract, or transaction under such 

terms and conditions as the Federal 

regulatory agency shall prescribe.

described in subparagraph (B)(i)(II) 

for which a Federal regulatory 

agency has issued a proposed

rule concerning agreements, 

contracts, or transactions

in foreign currency described in 

subparagraph (B)(i)(I) prior to the 

date of enactment of this subclause, 

subclause (I) shall take effect 90

days after the date of enactment of 

this subclause.

‘‘(iii) REQUIREMENTS OF 

RULES AND REGULATIONS.—

‘‘(I) IN GENERAL.—The 

rules and regulations described in 

clause (ii) shall prescribe appropriate

requirements with respect to—

‘‘(aa) disclosure;

‘‘(bb) recordkeeping;

‘‘(cc) capital and 

margin;

‘‘(dd) reporting;

‘‘(ee) business 

conduct;

‘‘(ff) documentation; 

and

‘‘(gg) such other 

standards or 

requirements as the 

Federal regulatory 

agency shall

determine to be 

necessary.

‘‘(II) TREATMENT.—The 

rules or regulations described in 

clause (ii) shall treat all agreements,

contracts, and transactions in foreign 

currency
described in subparagraph (B)(i)(I), 

and all agreements, contracts, and 

transactions in foreign currency

that are functionally or economically 

similar to agreements, contracts, or 

transactions described in 

subparagraph (B)(i)(I), similarly.’’.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [04] Title VII Wall Street Transparency and Accountability

Part: Part II Regulation of Swap Markets

Subtitle: Definitions Under the Securities Exchange Act of 1934

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE VII—WALL STREET TRANSPARENCY AND ACCOUNTABILITY

SEC. 761. DEFINITIONS UNDER THE SECURITIES 

EXCHANGE ACT OF 1934.

(a) DEFINITIONS.—Section 3(a) of the Securities Exchange 

Act of 1934 (15 U.S.C. 78c(a)) is amended—

* * * * *

‘‘(74) PRUDENTIAL REGULATOR.—The term 

‘prudential regulator’ has the same meaning as in section 1a of 

the Commodity Exchange Act (7 U.S.C. 1a).

* * * * *
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [04] Title VII Wall Street Transparency and Accountability

Part: Part II Regulation of Swap Markets

Subtitle: Amendments to the Securities Exchange Act of 1934

Chapter Name: [Chapter Name]

U.S. Code Citation 15 U.S.C. 78c-3

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE VII—WALL STREET TRANSPARENCY AND ACCOUNTABILITY

15 U.S.C. 78c-3 SEC. 763. AMENDMENTS TO THE SECURITIES EXCHANGE 

ACT OF 1934.

(a) CLEARING FOR SECURITY-BASED SWAPS.—The 

Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended by 

inserting after section 3B (as added by section 717 of this Act):

‘‘SEC. 3C. CLEARING FOR SECURITY-BASED SWAPS.

‘‘(a) IN GENERAL.—

‘‘(1) STANDARD FOR CLEARING.—It shall be 

unlawful for any person to engage in a security-based swap 

unless that person submits such security-based swap for clearing 

to a clearing agency that is registered under this Act or a clearing 

agency that is exempt from registration under this Act if the 

security-based swap is required to be cleared.

* * * * *

‘‘(g) EXCEPTIONS.—

‘‘(1) IN GENERAL.—The requirements of subsection 

(a)(1) shall not apply to a security-based swap if 1 of the 

counterparties to the security-based swap—

‘‘(A) is not a financial entity;

‘‘(B) is using security-based swaps to hedge or 

mitigate commercial risk; and

‘‘(C) notifies the Commission, in a manner set 

forth by the Commission, how it generally meets its 

financial obligations associated with entering into noncleared security-based swaps.

‘‘(2) OPTION TO CLEAR.—The application of the 

clearing exception in paragraph (1) is solely at the discretion of 

the counterparty to the security-based swap that meets the 

conditions of subparagraphs (A) through (C) of paragraph (1).
‘‘(3) FINANCIAL ENTITY DEFINITION.—

‘‘(A) IN GENERAL.—For the purposes of this 

subsection, the term ‘financial entity’ means—

* * * * *

‘‘(viii) a person predominantly engaged 

in activities that are in the business of banking or 

financial in nature, as defined in section 4(k) of 

the Bank Holding Company Act of 1956.

‘‘(B) EXCLUSION.—The Commission shall 

consider whether to exempt small banks, savings 

associations, farm credit system institutions, and credit 

unions, including—

‘‘(i) depository institutions with total 

assets of $10,000,000,000 or less;

‘‘(ii) farm credit system institutions with 

total assets of $10,000,000,000 or less; or

‘‘(iii) credit unions with total assets of 

$10,000,000,000 or less.

* * * * *
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [04] Title VII Wall Street Transparency and Accountability

Part: Part II Regulation of Swap Markets

Subtitle: Registration and Regulation of Security-Based Swap Dealers and Major 

Security-Based Swap Participants

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/8/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE VII—WALL STREET TRANSPARENCY AND ACCOUNTABILITY

SEC. 764. REGISTRATION AND REGULATION OF 

SECURITY-BASED SWAP DEALERS AND MAJOR SECURITYBASED SWAP PARTICIPANTS.

* * * * *

‘‘(d) RULEMAKING.—

‘‘(1) IN GENERAL.—The Commission shall adopt rules 

for persons that are registered as security-based swap dealers or

major security-based swap participants under this section.

‘‘(2) EXCEPTION FOR PRUDENTIAL 

REQUIREMENTS.—

‘‘(A) IN GENERAL.—The Commission may not 

prescribe rules imposing prudential requirements on 

security-based swap dealers or major security-based swap 

participants for which there is a prudential regulator.

* * * * *

‘‘(e) CAPITAL AND MARGIN REQUIREMENTS.—

‘‘(1) IN GENERAL.—

‘‘(A) SECURITY-BASED SWAP 

DEALERS AND MAJOR SECURITY-BASED 

SWAP PARTICIPANTS THAT ARE BANKS.—

Each registered security-based swap dealer and 

major security-based swap participant for which 

there is not a prudential regulator shall meet such 

minimum capital requirements and minimum initial 

and variation margin requirements as the prudential 
regulator shall by rule or regulation prescribe under 

paragraph (2)(A).

‘‘(B) SECURITY-BASED SWAP 

DEALERS AND MAJOR SECURITY-BASED 

SWAP PARTICIPANTS THAT ARE NOT 

BANKS.—Each registered security-based swap 

dealer and major security-based swap participant for 

which there is not a prudential regulator shall meet 

such minimum capital requirements and minimum 

initial and variation margin requirements as the 

Commission shall by rule or regulation prescribe

under paragraph (2)(B).

‘‘(2) RULES.—

‘‘(A) SECURITY-BASED SWAP 

DEALERS AND MAJOR SECURITY-BASED 

SWAP PARTICIPANTS THAT ARE BANKS.—

The prudential regulators, in consultation with the 

Commission and the Commodity Futures Trading 

Commission, shall adopt rules for security-based 

swap dealers and major security-based swap 

participants, with respect to their activities as a

swap dealer or major swap participant, for which 

there is a prudential regulator imposing—

‘‘(i) capital requirements; and

‘‘(ii) both initial and variation 

margin requirements on all security-based 

swaps that are not cleared by a registered 

clearing agency.

‘‘(B) SECURITY-BASED SWAP 

DEALERS AND MAJOR SECURITY-BASED 

SWAP PARTICIPANTS THAT ARE NOT 

BANKS.—The Commission shall adopt rules for 

security-based swap dealers and major securitybased swap participants, with respect to their 

activities as a swap dealer or major swap

participant, for which there is not a prudential 

regulator imposing—

‘‘(i) capital requirements; and

‘‘(ii) both initial and variation 

margin requirements on all swaps that are 

not cleared by a registered clearing agency.

‘‘(C) CAPITAL.—In setting capital 

requirements for a person that is designated as a 

security-based swap dealer or a major securitybased swap participant for a single type or single 

class or category of security-based swap
or activities, the prudential regulator and the 

Commission shall take into account the risks 

associated with other types of security-based swaps 

or classes of security-based swaps or categories of 

security-based swaps engaged in and the other 

activities conducted by that person that are not 

otherwise subject to regulation applicable to that

person by virtue of the status of the person.

‘‘(3) STANDARDS FOR CAPITAL AND 

MARGIN.—

‘‘(A) IN GENERAL.—To offset the greater 

risk to the security-based swap dealer or major 

security-based swap participant and the financial 

system arising from the use of security-based swaps 

that are not cleared, the requirements imposed under 

paragraph (2) shall —

‘‘(i) help ensure the safety and 

soundness of the security-based swap dealer 

or major security-based swap participant; 

and

‘‘(ii) be appropriate for the risk 

associated with the non-cleared securitybased swaps held as a security-based swap 

dealer or major security-based swap

participant.

* * * * *

‘‘(C) MARGIN REQUIREMENTS.—In 

prescribing margin requirements under this 

subsection, the prudential regulator with respect to 

security-based swap dealers and major securitybased swap participants that are depository

institutions, and the Commission with respect to 

security-based swap dealers and major securitybased swap participants that are not depository 

institutions shall permit the use of noncash 

collateral, as the regulator or the Commission

determines to be consistent with—

‘‘(i) preserving the financial integrity 

of markets trading security-based swaps; 

and

‘‘(ii) preserving the stability of the 

United States financial system.

‘‘(D) COMPARABILITY OF CAPITAL 

AND MARGIN REQUIREMENTS.—

‘‘(i) IN GENERAL.—The prudential 

regulators, the Commission, and the 
Securities and Exchange Commission shall 

periodically (but not less frequently

than annually) consult on minimum capital 

requirements and minimum initial and 

variation margin requirements.

‘‘(ii) COMPARABILITY.—The 

entities described in clause (i) shall, to the 

maximum extent practicable, establish and 

maintain comparable minimum capital

requirements and minimum initial and 

variation margin requirements, including the 

use of noncash collateral, for—

‘‘(I) security-based swap 

dealers; and

‘‘(II) major security-based 

swap participants.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [05] Title IX Investor Protections and Improvements to the Regulation 

of Securities

Part: Part II Regulation of Swap Markets

Subtitle: Short Title

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE IX—INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 

SECURITIES

SEC. 901. SHORT TITLE.

This title may be cited as the ‘‘Investor Protection and Securities Reform Act of 

2010’’.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [05] Title IX Investor Protections and Improvements to the Regulation 

of Securities

Part: Part II Regulation of Swap Markets

Subtitle: Review of Reliance on Ratings

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 78o-7 note

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE IX—INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 

SECURITIES

12 U.S.C. 78o-7 note SEC. 939A. REVIEW OF RELIANCE ON RATINGS.

(a) AGENCY REVIEW.—Not later than 1 year after the 

date of the enactment of this subtitle, each Federal agency shall, to

the extent applicable, review—

(1) any regulation issued by such agency that 

requires the use of an assessment of the credit-worthiness 

of a security or money market instrument; and

(2) any references to or requirements in such 

regulations regarding credit ratings.

(b) MODIFICATIONS REQUIRED.—Each such agency 

shall modify any such regulations identified by the review 

conducted under subsection (a) to remove any reference to or 

requirement of reliance on credit ratings and to substitute in such 

regulations such standard of credit-worthiness as each respective 

agency shall determine as appropriate for such regulations. In 

making such determination, such agencies shall seek to establish, 

to the extent feasible, uniform standards of credit-worthiness for 

use by each such agency, taking into account the entities regulated 

by each such agency and the purposes for which such entities 

would rely on such standards of credit-worthiness.

(c) REPORT.—Upon conclusion of the review required 

under subsection (a), each Federal agency shall transmit a report to 

Congress containing a description of any modification of any 

regulation such agency made pursuant to subsection (b).

* * * * *
Note: Section 939A of the Dodd-Frank Wall Street Reform and Consumer Protection Act 

adds a new provision to the Securities Exchange Act of 1934. United States Code cite is a 

note after the statutory provision.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [05] Title IX Investor Protections and Improvements to the Regulation 

of Securities

Part: Part II Regulation of Swap Markets

Subtitle: Regulation of Credit Risk Retention

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 78o-11

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE IX—INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 

SECURITIES

SEC. 941. REGULATION OF CREDIT RISK RETENTION.

(a) DEFINITION OF ASSET-BACKED SECURITY.—Section 

3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) is 

amended by adding at the end the following:

‘‘(77) ASSET-BACKED SECURITY.—The term 

‘asset-backed security’—

‘‘(A) means a fixed-income or other security

collateralized by any type of self-liquidating financial 

asset (including a loan, a lease, a mortgage, or a secured 

or unsecured receivable) that allows the holder of the 

security to receive payments that depend primarily on 

cash flow from the asset, including—

‘‘(i) a collateralized mortgage 

obligation;

‘‘(ii) a collateralized debt obligation;

‘‘(iii) a collateralized bond obligation;

‘‘(iv) a collateralized debt obligation of 

asset-backed securities;

‘‘(v) a collateralized debt obligation of 

collateralized debt obligations; and

‘‘(vi) a security that the Commission, by 

rule, determines to be an asset-backed security 

for purposes of this section;

* * * * *

(b) CREDIT RISK RETENTION.—The Securities Exchange 

Act of 1934 (15 U.S.C. 78a et seq.) is amended by inserting after section

15F, as added by this Act, the following:
15 U.S.C. 78o–11 ‘‘SEC. 15G. CREDIT RISK RETENTION.

* * * * *

‘‘(b) REGULATIONS REQUIRED.—

‘‘(1) IN GENERAL.—Not later than 270 days after the 

date of enactment of this section, the Federal banking agencies

and the Commission shall jointly prescribe regulations to

require any securitizer to retain an economic interest in a

portion of the credit risk for any asset that the securitizer,

through the issuance of an asset-backed security, transfers,

sells, or conveys to a third party.

‘‘(2) RESIDENTIAL MORTGAGES.—Not later than 

270 days after the date of the enactment of this section, the 

Federal banking agencies, the Commission, the Secretary of 

Housing and Urban Development, and the Federal Housing 

Finance Agency, shall jointly prescribe regulations to require 

any securitizer to retain an economic interest in a portion of the

credit risk for any residential mortgage asset that the

securitizer, through the issuance of an asset-backed security,

transfers, sells, or conveys to a third party.

‘‘(c) STANDARDS FOR REGULATIONS.—

‘‘(1) STANDARDS.—The regulations prescribed under 

subsection (b) shall—

‘‘(A) prohibit a securitizer from directly or 

indirectly hedging or otherwise transferring the credit 

risk that the securitizer is required to retain with respect 

to an asset;

‘‘(B) require a securitizer to retain—

‘‘(i) not less than 5 percent of the credit 

risk for any asset—

‘‘(I) that is not a qualified 

residential mortgage that is transferred, 

sold, or conveyed through the

issuance of an asset-backed security by 

the securitizer; or

‘‘(II) that is a qualified 

residential mortgage that is transferred, 

sold, or conveyed through the issuance 

of an asset-backed security by the

securitizer, if 1 or more of the assets that

collateralize the asset-backed security 

are not qualified residential mortgages; 

or

‘‘(ii) less than 5 percent of the credit 

risk for an asset that is not a qualified residential 

mortgage that is transferred, sold, or conveyed 

through the issuance of an asset-backed security 

by the securitizer, if the originator of the asset 

meets the underwriting standards prescribed 

under paragraph (2)(B);

‘‘(C) specify—
‘‘(i) the permissible forms of risk 

retention for purposes of this section;

‘‘(ii) the minimum duration of the risk 

retention required under this section; and

‘‘(iii) that a securitizer is not required to 

retain any part of the credit risk for an asset that 

is transferred, sold or conveyed through the 

issuance of an asset-backed security by the 

securitizer, if all of the assets that collateralize 

the asset-backed security are qualified 

residential mortgages;

* * * * *

‘‘(e) EXEMPTIONS, EXCEPTIONS, AND DJUSTMENTS.—

* * * * *

‘‘(3) CERTAIN INSTITUTIONS AND PROGRAMS 

EXEMPT.—

‘‘(A) FARM CREDIT SYSTEM 

INSTITUTIONS.—Notwithstanding any other provision 

of this section, the requirements of this section shall not 

apply to any loan or other financial asset made, insured, 

guaranteed, or purchased by any institution that is 

subject to the supervision of the Farm Credit 

Administration, including the Federal Agricultural 

Mortgage Corporation.

* * * * *

Note: Bills have been introduced in Congress to substantially revise the Dodd-Frank Act. 

Accordingly, any portion of the Dodd-Frank Act may be modified or repealed in the next 4-years 

(2017-21).

Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [05] Title IX Investor Protections and Improvements to the Regulation 

of Securities

Part: Part II Regulation of Swap Markets

Subtitle: Shareholder Vote on Executive Compensation Disclosures

Chapter Name: [Chapter Name]

U.S. Code Citation 15 U.S.C. 78n-1

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE IX—INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 

SECURITIES

SEC. 951. SHAREHOLDER VOTE ON EXECUTIVE 

COMPENSATION DISCLOSURES.

The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 

amended by inserting after section 14 (15 U.S.C. 78n) the following:

15 U.S.C. 78n–1 ‘‘SEC. 14A. SHAREHOLDER APPROVAL OF EXECUTIVE 

COMPENSATION.

‘‘(a) SEPARATE RESOLUTION REQUIRED.—

‘‘(1) IN GENERAL.—Not less frequently than once 

every 3 years, a proxy or consent or authorization for an annual 

or other meeting of the shareholders for which the proxy 

solicitation rules of the Commission require compensation 

disclosure shall include a separate resolution subject to 

shareholder vote to approve the compensation of executives, as 

disclosed pursuant to section 229.402 of title 17, Code of Federal 

Regulations, or any successor thereto.

‘‘(2) FREQUENCY OF VOTE.—Not less frequently 

than once every 6 years, a proxy or consent or authorization for 

an annual or other meeting of the shareholders for which the 

proxy solicitation rules of the Commission require compensation 

disclosure shall include a separate resolution subject to 

shareholder vote to determine whether votes on the resolutions 

required under paragraph (1) will occur every 1, 2, or 3 years.

‘‘(3) EFFECTIVE DATE.—The proxy or consent or 

authorization for the first annual or other meeting of the 

shareholders occurring after the end of the 6-month period 

beginning on the date of enactment of this section shall 

include—
‘‘(A) the resolution described in paragraph (1); 

and

‘‘(B) a separate resolution subject to shareholder 

vote to determine whether votes on the resolutions 

required under paragraph (1) will occur every 1, 2, or 3 

years.

‘‘(b) SHAREHOLDER APPROVAL OF GOLDEN

PARACHUTE COMPENSATION.—

‘‘(1) DISCLOSURE.—In any proxy or consent 

solicitation material (the solicitation of which is subject to the 

rules of the Commission pursuant to subsection (a)) for a 

meeting of the shareholders occurring after the end of the 6-

month period beginning on the date of enactment of this section, 

at which shareholders are asked to approve an acquisition, 

merger, consolidation, or proposed sale or other disposition of 

all or substantially all the assets of an issuer, the person making

such solicitation shall disclose in the proxy or consent 

solicitation material, in a clear and simple form in accordance 

with regulations to be promulgated by the Commission, any 

agreements or understandings that such person has with any 

named executive officers of such issuer (or of the acquiring 

issuer, if such issuer is not the acquiring issuer) concerning any 

type of compensation (whether present, deferred, or contingent) 

that is based on or otherwise relates to the acquisition, merger,

consolidation, sale, or other disposition of all or substantially

all of the assets of the issuer and the aggregate total of all

such compensation that may (and the conditions upon which

it may) be paid or become payable to or on behalf of such 

executive officer.

‘‘(2) SHAREHOLDER APPROVAL.—Any proxy or 

consent or authorization relating to the proxy or consent 

solicitation material containing the disclosure required by 

paragraph (1) shall include a separate resolution subject to 

shareholder vote to approve such agreements or understandings 

and compensation as disclosed, unless such agreements or 

understandings have been subject to a shareholder vote under 

subsection (a).

‘‘(c) RULE OF CONSTRUCTION.—The shareholder vote 

referred to in subsections (a) and (b) shall not be binding on the issuer

or the board of directors of an issuer, and may not be construed—

‘‘(1) as overruling a decision by such issuer or board of

directors;

‘‘(2) to create or imply any change to the fiduciary 

duties of such issuer or board of directors;

‘‘(3) to create or imply any additional fiduciary duties 

for such issuer or board of directors; or

‘‘(4) to restrict or limit the ability of shareholders to 

make proposals for inclusion in proxy materials related to 

executive compensation.

‘‘(d) DISCLOSURE OF VOTES.—Every institutional 

investment manager subject to section 13(f) shall report at least annually
how it voted on any shareholder vote pursuant to subsections (a)

and (b), unless such vote is otherwise required to be reported

publicly by rule or regulation of the Commission.

‘‘(e) EXEMPTION.—The Commission may, by rule or order,

exempt an issuer or class of issuers from the requirement under

subsection (a) or (b). In determining whether to make an exemption

under this subsection, the Commission shall take into account,

among other considerations, whether the requirements under subsections

(a) and (b) disproportionately burdens small issuers.’’.VerDate No

* * * * *

Note: This provision only affects companies whose stock is publicly traded and, therefore, it applies 

to Farmer Mac, but not other Farm Credit System institutions.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [05] Title IX Investor Protections and Improvements to the Regulation 

of Securities

Part: Part II Regulation of Swap Markets

Subtitle: Executive Compensation Disclosures

Chapter Name: [Chapter Name]

U.S. Code Citation 15 U.S.C. 78l note

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE IX—INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 

SECURITIES

15 USC 78l note SEC. 953. EXECUTIVE COMPENSATION 

DISCLOSURES.

(a) DISCLOSURE OF PAY VERSUS

PERFORMANCE.—Section 14 of the Securities Exchange 

Act of 1934 (15 U.S.C. 78n), as amended by this title, is 

amended by adding at the end the following:

‘‘(i) DISCLOSURE OF PAY VERSUS 

PERFORMANCE.—The Commission shall, by 

rule, require each issuer to disclose in any proxy or 

consent solicitation material for an annual meeting 

of the shareholders of the issuer a clear description 

of any compensation required to be disclosed by the 

issuer under section 229.402 of title 17, Code of 

Federal Regulations (or any successor thereto),

including information that shows the relationship 

between executive compensation actually paid and 

the financial performance of the issuer, taking into 

account any change in the value of the shares

of stock and dividends of the issuer and any 

distributions. The disclosure under this subsection 

may include a graphic representation

of the information required to be disclosed.’’.

(b) ADDITIONAL DISCLOSURE 

REQUIREMENTS.—
(1) IN GENERAL.—The Commission shall amend 

section 229.402 of title 17, Code of Federal Regulations, to 

require each issuer to disclose in any filing of the issuer 

described in section 229.10(a) of title 17, Code of Federal 

Regulations (or any successor thereto)—

(A) the median of the annual total 

compensation of all employees of the issuer, except 

the chief executive officer (or any equivalent 

position) of the issuer;

(B) the annual total compensation of the 

chief executive officer (or any equivalent position) 

of the issuer; and

(C) the ratio of the amount described in 

subparagraph (A) to the amount described in 

subparagraph (B).

(2) TOTAL COMPENSATION.—For purposes of 

this subsection, the total compensation of an employee of 

an issuer shall be determined in accordance with section 

229.402(c)(2)(x) of title 17, Code of Federal Regulations, 

as in effect on the day before the date of enactment of this 

Act.

Note: This provision only affects companies whose stock is publicly traded and, therefore, 

it applies to Farmer Mac, but not other Farm Credit System institutions.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [05] Title IX Investor Protections and Improvements to the Regulation 

of Securities

Part: Part II Regulation of Swap Markets

Subtitle: Recovery of Erroneously Awarded Compensation

Chapter Name: [Chapter Name]

U.S. Code Citation 15 U.S.C. 78j-4

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE IX—INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 

SECURITIES

SEC. 954. RECOVERY OF ERRONEOUSLY AWARDED 

COMPENSATION.

The Securities Exchange Act of 1934 is amended by 

inserting after section 10C, as added by section 952, the following:

15 U.S.C. 78j–4 ‘‘SEC. 10D. RECOVERY OF ERRONEOUSLY AWARDED 

COMPENSATION POLICY.

‘‘(a) LISTING STANDARDS.—The Commission shall, by 

rule, direct the national securities exchanges and national securities 

associations to prohibit the listing of any security of an issuer that 

does not comply with the requirements of this section.

‘‘(b) RECOVERY OF FUNDS.—The rules of the 

Commission under subsection (a) shall require each issuer to 

develop and implement a policy providing—

‘‘(1) for disclosure of the policy of the issuer on 

incentive-based compensation that is based on financial 

information required to be reported under the securities 

laws; and

‘‘(2) that, in the event that the issuer is required to 

prepare an accounting restatement due to the material 

noncompliance of the issuer with any financial reporting 

requirement under the securities laws, the issuer will 

recover from any current or former executive officer of the 

issuer who received incentive-based compensation 

(including stock options awarded as compensation)

during the 3-year period preceding the date on which
the issuer is required to prepare an accounting restatement,

based on the erroneous data, in excess of what would have

been paid to the executive officer under the accounting 

restatement.’’.

Note: This provision only affects companies whose stock is publicly traded and, therefore, 

it applies to Farmer Mac, but not other Farm Credit System institutions.
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [06] Title X Bureau of Consumer Financial Protection

Part: Part II Regulation of Swap Markets

Subtitle: Short Title

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5301 note

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE X—BUREAU OF CONSUMER FINANCIAL PROTECTION

12 U.S.C. 5301 note SEC. 1001. SHORT TITLE.

This title may be cited as the ‘‘Consumer Financial Protection 

Act of 2010’’.

* * * * *
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [06] Title X Bureau of Consumer Financial Protection

Part: Part II Regulation of Swap Markets

Subtitle: Supervision of Nondepository Covered Persons

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5514

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE X—BUREAU OF CONSUMER FINANCIAL PROTECTION

12 U.S.C. 5514 SEC. 1024. SUPERVISION OF NONDEPOSITORY 

COVERED PERSONS.

* * * * *

(f) PRESERVATION OF FARM CREDIT 

ADMINISTRATION AUTHORITY.—No provision of this title 

may be construed as modifying, limiting, or otherwise affecting the 

authority of the Farm Credit Administration.

* * * * *
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [06] Title X Bureau of Consumer Financial Protection

Part: Part II Regulation of Swap Markets

Subtitle: Limitations on Authorities of the Bureau; Preservation of Authorities

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5517

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

TITLE X—BUREAU OF CONSUMER FINANCIAL PROTECTION

12 U.S.C. 5517 SEC. 1027. LIMITATIONS ON AUTHORITIES OF THE 

BUREAU; PRESERVATION OF AUTHORITIES.

* * * * *

(k) EXCLUSION FOR PERSONS REGULATED BY THE 

FARM CREDIT ADMINISTRATION.—

(1) IN GENERAL.—No provision of this title shall be 

construed as altering, amending, or affecting the authority of the

Farm Credit Administration to adopt rules, initiate enforcement

proceedings, or take any other action with respect to a person

regulated by the Farm Credit Administration. The Bureau shall

have no authority to exercise any power to enforce this title

with respect to a person regulated by the Farm Credit 

Administration.

(2) DEFINITION.—For purposes of this subsection, the 

term ‘‘person regulated by the Farm Credit Administration’’ 

means any Farm Credit System institution that is chartered and 

subject to the provisions of the Farm Credit Act of 1971 (12

U.S.C. 2001 et seq.).

* * * * *
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [07] No Title

Part: Part II Regulation of Swap Markets

Subtitle: Amendments to the Secure and Fair Enforcement for Mortgage 

Licensing Act of 2008

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5109

Date Created: 8/9/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

SEC. 1100. AMENDMENTS TO THE SECURE AND FAIR

ENFORCEMENT FOR MORTGAGE LICENSING ACT OF 2008.

The S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C.

5101 et seq.) is amended—

* * * * *

(5) in section 1507 (12 U.S.C. 5106)—

(A) in subsection (a)—

(i) by striking paragraph (1) and inserting 

the following:

‘‘(1) IN GENERAL.—The Bureau shall develop and 

maintain a system for registering employees of a depository 

institution, employees of a subsidiary that is owned and controlled 

by a depository institution and regulated by a Federal banking

agency, or employees of an institution regulated by the Farm

Credit Administration, as registered loan originators with the

Nationwide Mortgage Licensing System and Registry. The

system shall be implemented before the end of the 1-year

period beginning on the date of enactment of the Consumer

Financial Protection Act of 2010.’’; and

(ii) in paragraph (2)—

(I) by striking ‘‘appropriate Federal 

banking agency and the Farm Credit 

Administration’’ and inserting ‘‘Bureau’’; 

and

* * * * *

(B) in subsection (b), by striking ‘‘through the 

Financial Institutions Examination Council, and the Farm 

Credit Administration’’, and inserting ‘‘and the Bureau of

Consumer Financial Protection’’;
* * * * *

(7) by striking section 1510 (12 U.S.C. 5109) and inserting 

the following:

12 U.S.C. 5109 ‘‘SEC. 1510. FEES.

‘‘The Bureau, the Farm Credit Administration, and the 

Nationwide Mortgage Licensing System and Registry may charge 

reasonable fees to cover the costs of maintaining and providing 

access to information from the Nationwide Mortgage Licensing 

System and Registry, to the extent that such fees are not charged to

consumers for access to such system and registry.’’;

* * * * *
Type: Statute

Statute: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION 

ACT

Title: [07] No Title

Part: Part II Regulation of Swap Markets

Subtitle: Amendments to the Truth in Lending Act

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/10/2017

Date Modified: 2/15/2018

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

PART II—REGULATION OF SWAP MARKETS

SEC. 1100A. AMENDMENTS TO THE TRUTH IN 

LENDING ACT.

The Truth in Lending Act (15 U.S.C. 1601 et seq.) is 

amended—

* * * * *

(8) in section 108 (15 U.S.C. 1604), by adding at 

the endthe following:

(A) by striking subsection (a) and inserting 

the following:

‘‘(a) ENFORCING AGENCIES.—Subject to subtitle B of 

the Consumer Financial Protection Act of 2010, compliance with 

the requirements imposed under this title shall be enforced under—

* * * * *

‘‘(5) the Farm Credit Act of 1971, by the Farm 

Credit Administration with respect to any Federal land 

bank, Federal land bank association, Federal intermediate 

credit bank, or production credit association; 
Type: Statute

Statute: FOOD, CONSERVATION, AND ENERGY ACT, 2008

Title: Title V Credit

Part: [Part]

Subtitle: Subtitle E--Farm Credit

Chapter Name: Equalization of Loan-Making Powers of Certain District Associations

U.S. Code Citation 12 U.S.C. 2252 note 

Date Created: 12/18/2012

Date Modified: 2/15/2018

FOOD, CONSERVATION, AND ENERGY ACT OF 2008

* * * * *

TITLE V—CREDIT

* * * * *

SUBTITLE E--FARM CREDIT

* * * * *

12 U.S.C. 2252 SEC. 5407. EQUALIZATION OF LOAN-MAKING POWERS 

OF CERTAIN DISTRICT ASSOCIATIONS

note

* * * * *

(d) EFFECTIVE DATE.--The amendments made by this section take 

effective on January 1, 2010.

* * * * *

NOTE: Section 5407 added a new section 7.7 and amended sections 

5.17 of the Farm Credit Act of 1971, 401 of the Farm Credit Banks 

and Associations Safety and Soundness Act of 1992, and 410 of the 

Agricultural Credit Act of 1987. 
Type: Statute

Statute: HOUSING AND ECONOMIC RECOVERY ACT OF 2008

Title: Title V S.A.F.E. Mortgage Licensing Act

Part: [Part]

Subtitle: Short Title

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5101 note

Date Created: 8/10/2017

Date Modified: 2/15/2018

HOUSING AND ECONOMIC RECOVERY ACT OF 2008

TITLE V—S.A.F.E. MORTGAGE LICENSING ACT

12 U.S.C. 5101 note SEC. 1501. SHORT TITLE.

This title may be cited as the ‘‘Secure and Fair Enforcement

for Mortgage Licensing Act of 2008’’ or ‘‘S.A.F.E. Mortgage Licensing

Act of 2008’’.
Type: Statute

Statute: HOUSING AND ECONOMIC RECOVERY ACT OF 2008

Title: Title V S.A.F.E. Mortgage Licensing Act

Part: [Part]

Subtitle: Purposes and Methods for Establishing a Mortgage Licensing System 

and Registry

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5101 note

Date Created: 8/10/2017

Date Modified: 2/15/2018

HOUSING AND ECONOMIC RECOVERY ACT OF 2008

TITLE V—S.A.F.E. MORTGAGE LICENSING ACT

12 U.S.C. 5101 note SEC. 1502. PURPOSES AND METHODS FOR 

ESTABLISHING A MORTGAGE LICENSING SYSTEM AND 

REGISTRY.

In order to increase uniformity, reduce regulatory burden,

enhance consumer protection, and reduce fraud, the States, through

the Conference of State Bank Supervisors and the American

Association of Residential Mortgage Regulators, are hereby encouraged 

to establish a Nationwide Mortgage Licensing System and Registry for 

the residential mortgage industry that accomplishes all of the following 

objectives:

(1) Provides uniform license applications and reporting 

requirements for State-licensed loan originators.

(2) Provides a comprehensive licensing and supervisory 

database.

(3) Aggregates and improves the flow of information to 

and between regulators.

(4) Provides increased accountability and tracking of 

loan originators.

(5) Streamlines the licensing process and reduces the 

regulatory burden.

(6) Enhances consumer protections and supports antifraud measures.

(7) Provides consumers with easily accessible 

information, offered at no charge, utilizing electronic media, 

including the Internet, regarding the employment history of, and 

publicly adjudicated disciplinary and enforcement actions 

against, loan originators.

(8) Establishes a means by which residential mortgage

loan originators would, to the greatest extent possible, be

required to act in the best interests of the consumer.
(9) Facilitates responsible behavior in the subprime 

mortgage market place and provides comprehensive training and

examination requirements related to subprime mortgage lending.

(10) Facilitates the collection and disbursement of 

consumer complaints on behalf of State and Federal mortgage 

regulators.
Type: Statute

Statute: HOUSING AND ECONOMIC RECOVERY ACT OF 2008

Title: Title V S.A.F.E. Mortgage Licensing Act

Part: [Part]

Subtitle: Definitions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5102

Date Created: 8/10/2017

Date Modified: 2/15/2018

HOUSING AND ECONOMIC RECOVERY ACT OF 2008

TITLE V—S.A.F.E. MORTGAGE LICENSING ACT

12 U.S.C. 5102 SEC. 1503. DEFINITIONS.

For purposes of this title, the following definitions shall apply:

* * * * *

(3) LOAN ORIGINATOR.—

(A) IN GENERAL.—The term ‘‘loan 

originator’’—

(i) means an individual who—

(I) takes a residential mortgage 

loan application; and

(II) offers or negotiates terms of 

a residential mortgage loan for 

compensation or gain;

(ii) does not include any individual who 

is not otherwise described in clause (i) and who 

performs purely administrative or clerical tasks 

on behalf of a person who is described in any 

such clause;

(iii) does not include a person or entity 

that only performs real estate brokerage 

activities and is licensed or registered in 

accordance with applicable State law, unless the 

person or entity is compensated by a lender, a 

mortgage broker, or other loan originator or by 

any agent of such lender, mortgage broker, or 

other loan originator; and

(iv) does not include a person or entity 

solely involved in extensions of credit relating to 

timeshare plans, as that term is defined in 

section 101(53D) of title 11, United States Code.

(B) OTHER DEFINITIONS RELATING TO 

LOAN ORIGINATOR.—For purposes of this 

subsection, an individual ‘‘assists a consumer in 

obtaining or applying to obtain a residential mortgage 
loan’’ by, among other things, advising on loan terms 

(including rates, fees, other costs), preparing loan 

packages, or collecting information on behalf of the 

consumer with regard to a residential mortgage loan.

(C) ADMINISTRATIVE OR CLERICAL 

TASKS.—The term ‘‘administrative or clerical tasks’’ 

means the receipt, collection, and distribution of 

information common for the processing or underwriting 

of a loan in the mortgage industry and communication 

with a consumer to obtain information necessary for the 

processing or underwriting of a residential mortgage 

loan.

(D) REAL ESTATE BROKERAGE ACTIVITY 

DEFINED.—The term ‘‘real estate brokerage activity’’ 

means any activity that involves offering or providing 

real estate brokerage services to the public, including—

(i) acting as a real estate agent or real 

estate broker for a buyer, seller, lessor, or lessee 

of real property;

(ii) bringing together parties interested 

in the sale, purchase, lease, rental, or exchange 

of real property;

(iii) negotiating, on behalf of any party, 

any portion of a contract relating to the sale, 

purchase, lease, rental, or exchange of real 

property (other than in connection with 

providing financing with respect to any such 

transaction);

(iv) engaging in any activity for which a 

person engaged in the activity is required to be 

registered or licensed as a real estate agent or 

real estate broker under any applicable law; and

(v) offering to engage in any activity, or 

act in any capacity, described in clause (i), (ii), 

(iii), or (iv).

(4) LOAN PROCESSOR OR UNDERWRITER.—

(A) IN GENERAL.—The term ‘‘loan processor 

or underwriter’’ means an individual who performs 

clerical or support duties at the direction of and subject 

to the supervision and instruction of—

(i) a State-licensed loan originator; or

(ii) a registered loan originator.

(B) CLERICAL OR SUPPORT DUTIES.—For 

purposes of subparagraph (A), the term ‘‘clerical or 

support duties’’ may include—

(i) the receipt, collection, distribution, 

and analysis of information common for the 

processing or underwriting of a residential 

mortgage loan; and

(ii) communicating with a consumer to 

obtain the information necessary for the 
processing or underwriting of a loan, to the 

extent that such communication does not include 

offering or negotiating loan rates or terms, or 

counseling consumers about residential

mortgage loan rates or terms.

(5) NATIONWIDE MORTGAGE LICENSING 

SYSTEM AND REGISTRY.—The term ‘‘Nationwide Mortgage 

Licensing System and Registry’’ means a mortgage licensing 

system developed and maintained by the Conference of State 

Bank Supervisors and the American Association of Residential 

Mortgage Regulators for the State licensing and registration of 

State-licensed loan originators and the registration of registered 

loan originators or any system established by the Secretary under 

section 1509.

(6) NONTRADITIONAL MORTGAGE PRODUCT.—

The term ‘‘nontraditional mortgage product’’ means any 

mortgage product other than a 30-year fixed rate mortgage.

(7) REGISTERED LOAN ORIGINATOR.—The term 

‘‘registered loan originator’’ means any individual who—

(A) meets the definition of loan originator and is 

an employee of—

(i) a depository institution;

(ii) a subsidiary that is—

(I) owned and controlled by a 

depository institution; and

(II) regulated by a Federal 

banking agency; or

(iii) an institution regulated by the Farm 

Credit Administration; and

(B) is registered with, and maintains a unique 

identifier through, the Nationwide Mortgage Licensing 

System and Registry.

(8) RESIDENTIAL MORTGAGE LOAN.—The term 

‘‘residential mortgage loan’’ means any loan primarily for 

personal, family, or household use that is secured by a mortgage, 

deed of trust, or other equivalent consensual security interest on 

a dwelling (as defined in section 103(v) of the Truth in Lending 

Act) or residential real estate upon which is constructed or 

intended to be constructed a dwelling (as so defined).

* * * * *

(11) STATE-LICENSED LOAN ORIGINATOR.—The 

term ‘‘State-licensed loan originator’’ means any individual 

who—

(A) is a loan originator;

(B) is not an employee of—

(i) a depository institution;

(ii) a subsidiary that is—

(I) owned and controlled by a 

depository institution; and

(II) regulated by a Federal 

banking agency; or
(iii) an institution regulated by the Farm 

Credit Administration; and

(C) is licensed by a State or by the Secretary 

under section 1508 and registered as a loan originator 

with, and maintains a unique identifier through, the 

Nationwide Mortgage Licensing System and Registry.

(12) UNIQUE IDENTIFIER.—

(A) IN GENERAL.—The term ‘‘unique 

identifier’’ means a number or other identifier that—

(i) permanently identifies a loan 

originator;

(ii) is assigned by protocols established 

by the Nationwide Mortgage Licensing System 

and Registry and the Federal banking agencies 

to facilitate electronic tracking of loan 

originators and uniform identification of, and 

public access to, the employment history of and 

the publicly adjudicated disciplinary and

enforcement actions against loan originators; 

and

(iii) shall not be used for purposes other

than those set forth under this title.
Type: Statute

Statute: HOUSING AND ECONOMIC RECOVERY ACT OF 2008

Title: Title V S.A.F.E. Mortgage Licensing Act

Part: [Part]

Subtitle: License or Registration Required

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5103

Date Created: 8/10/2017

Date Modified: 2/15/2018

HOUSING AND ECONOMIC RECOVERY ACT OF 2008

TITLE V—S.A.F.E. MORTGAGE LICENSING ACT

12 U.S.C. 5103 SEC. 1504. LICENSE OR REGISTRATION REQUIRED.

(a) IN GENERAL.—Subject to the existence of a licensing or

registration regime, as the case may be, an individual may not

engage in the business of a loan originator without first—

(1) obtaining, and maintaining annually—

(A) a registration as a registered loan originator; 

or

(B) a license and registration as a State-licensed 

loan originator; and

(2) obtaining a unique identifier.

(b) LOAN PROCESSORS AND UNDERWRITERS.—

(1) SUPERVISED LOAN PROCESSORS AND 

UNDERWRITERS.—A loan processor or underwriter who does 

not represent to the public, through advertising or other means of 

communicating or providing information (including the use of 

business cards, stationery, brochures, signs, rate lists, or other 

promotional items), that such individual can or will perform any

of the activities of a loan originator shall not be required

to be a State-licensed loan originator.

(2) INDEPENDENT CONTRACTORS.—An 

independent contractor may not engage in residential mortgage 

loan origination activities as a loan processor or underwriter 

unless such independent contractor is a State-licensed loan 

originator.
Type: Statute

Statute: HOUSING AND ECONOMIC RECOVERY ACT OF 2008

Title: Title V S.A.F.E. Mortgage Licensing Act

Part: [Part]

Subtitle: System of Registration Administration by Federal Agencies

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5106

Date Created: 8/10/2017

Date Modified: 2/15/2018

HOUSING AND ECONOMIC RECOVERY ACT OF 2008

TITLE V—S.A.F.E. MORTGAGE LICENSING ACT

12 U.S.C. 5106 SEC. 1507. SYSTEM OF REGISTRATION ADMINISTRATION 

BY FEDERAL AGENCIES.

(a) DEVELOPMENT.—

(1) IN GENERAL.—The Federal banking agencies shall

jointly, through the Federal Financial Institutions Examination

Council, and together with the Farm Credit Administration,

develop and maintain a system for registering employees of

a depository institution, employees of a subsidiary that is owned

and controlled by a depository institution and regulated by

a Federal banking agency, or employees of an institution 

regulated by the Farm Credit Administration, as registered loan

originators with the Nationwide Mortgage Licensing System and 

Registry. The system shall be implemented before the end of the 

1-year period beginning on the date of enactment of this title.

(2) REGISTRATION REQUIREMENTS.—In 

connection with the registration of any loan originator under this 

subsection, the appropriate Federal banking agency and the Farm 

Credit Administration shall, at a minimum, furnish or cause to be

furnished to the Nationwide Mortgage Licensing System and

Registry information concerning the employees’ identity,

including—

(A) fingerprints for submission to the Federal 

Bureau of Investigation, and any governmental agency 

or entity authorized to receive such information for a 

State and national criminal history background check; 

and

(B) personal history and experience, including

authorization for the Nationwide Mortgage Licensing

System and Registry to obtain information related to any

administrative, civil or criminal findings by any 

governmental jurisdiction.

(b) COORDINATION.—

(1) UNIQUE IDENTIFIER.—The Federal banking 

agencies, through the Financial Institutions Examination 
Council, and the Farm Credit Administration shall coordinate 

with the

Nationwide Mortgage Licensing System and Registry to 

establish protocols for assigning a unique identifier to each 

registered loan originator that will facilitate electronic tracking 

and uniform identification of, and public access to, the 

employment history of and publicly adjudicated disciplinary and 

enforcement actions against loan originators.

(2) NATIONWIDE MORTGAGE LICENSING 

SYSTEM AND REGISTRY DEVELOPMENT.—To facilitate 

the transfer of information required by subsection (a)(2), the 

Nationwide Mortgage Licensing System and Registry shall 

coordinate with the Federal banking agencies, through the 

Financial Institutions Examination Council, and the Farm Credit 

Administration concerning the development and operation, by 

such System and Registry, of the registration functionality and 

data requirements for loan originators.

(c) CONSIDERATION OF FACTORS AND PROCEDURES.—

In establishing the registration procedures under subsection (a) and the

protocols for assigning a unique identifier to a registered loan originator, 

the Federal banking agencies shall make such de minimis exceptions as 

may be appropriate to paragraphs (1)(A) and (2) of section 1504(a), shall 

make reasonable efforts to utilize existing information to minimize the 

burden of registering loan originators, and shall consider methods for 

automating the process to the greatest extent practicable consistent with 

the purposes of this title.
Type: Statute

Statute: HOUSING AND ECONOMIC RECOVERY ACT OF 2008

Title: Title V S.A.F.E. Mortgage Licensing Act

Part: [Part]

Subtitle: Fees

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 5109

Date Created: 8/10/2017

Date Modified: 2/15/2018

HOUSING AND ECONOMIC RECOVERY ACT OF 2008

TITLE V—S.A.F.E. MORTGAGE LICENSING ACT

12 U.S.C. 5109 SEC. 1510. FEES.

The Federal banking agencies, the Farm Credit Administration,

the Secretary, and the Nationwide Mortgage Licensing System and

Registry may charge reasonable fees to cover the costs of maintaining 

and providing access to information from the Nationwide Mortgage 

Licensing System and Registry, to the extent that such fees are not 

charged to consumers for access to such system and registry.

Note: Sections 1507 and 1510 have been superseded by section 1100 of the Dodd-Frank Act, which 

transferred authority from the FFIEC Agencies and the FCA to the CFPB. Section 1100 of the 

Dodd-Frank Act also renumbered some of these provisions. 
Type: Statute

Statute: FARM SECURITY AND RURAL INVESTMENT ACT OF 2002

Title: Title VI Rural Development

Part: [Part]

Subtitle: Financial Institution Investments

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 1921 et seq.

Date Created: 12/18/2012

Date Modified: 2/15/2018

FARM SECURITY AND RURAL INVESTMENT ACT OF 2002

* * * * *

TITLE VI—RURAL DEVELOPMENT

* * * * *

7 U.S.C. 1921 et seq. SEC. 384J. FINANCIAL INSTITUTION INVESTMENTS.

(a) IN GENERAL.—Except as otherwise provided in this section and 

notwithstanding any other provision of law, the following banks, associations, 

and institutions are eligible both to establish and invest in any rural business 

investment company or in any entity established to invest solely in rural business 

investment companies:

(1) Any bank or savings association the deposits of which are 

insured under the Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.).

(2) Any Farm Credit System institution described in section 1.2(a) 

of the Farm Credit Act of 1971 (12 U.S.C. 2002(a)).

(b) LIMITATION.—No bank, association, or institution described in 

subsection (a) may make investments described in subsection (a) that are greater 

than 5 percent of the capital and surplus of the bank, association, or institution.

(c) LIMITATION ON RURAL BUSINESS INVESTMENT 

COMPANIES CONTROLLED BY FARM CREDIT SYSTEM 

INSTITUTIONS.—If a Farm Credit System institution described in section 1.2(a) 

of the Farm Credit Act of 1971 (12 U.S.C. 2002(a)) holds more than 15 percent 

of the shares of a rural business investment company, either alone or in 

conjunction with other System institutions (or affiliates), the rural business 

investment company shall not provide equity investments in, or provide other 

financial assistance to, entities that are not otherwise eligible to receive financing 

from the Farm Credit System under that Act (12 U.S.C. 2001 et seq.).

* * * * *

NOTE: Section 6029 of the Farm Security and Rural Investment Act 

of 2002, Public Law 107-171, added a new subtitle H to the 

Consolidated Farm and Rural Development Act. This subtitle 

establishes a new "Rural Business Investment Program." Section 

384J, reproduced here, discusses Farm Credit System institutions' 

investment in rural business investment companies.
Type: Statute

Statute: OMNIBUS CONSOLIDATED APPROPRIATIONS ACT, 1997

Title: Title II Economic Growth and Regulatory Paperwork Reduction

Part: [Part]

Subtitle: Subtitle F--Miscellaneous

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 1781, 1828 

Date Created: 12/18/2012

Date Modified: 2/15/2018

OMNIBUS CONSOLIDATED APPROPRIATIONS ACT, 1997 

Public Law 104-208, September 30, 1996

 

* * * * *

TITLE II--ECONOMIC GROWTH AND REGULATORY PAPERWORK REDUCTION

* * * * *

Subtitle F--Miscellaneous

* * * * *

SEC. 2615. PROHIBITIONS ON CERTAIN DEPOSITORY 

INSTITUTION ASSOCIATIONS WITH GOVERNMENT-SPONSORED 

ENTERPRISES.

 

* * * * *

12 U.S.C. 1781 (e) PROHIBITION ON CERTAIN ASSOCIATIONS.--

 (1) IN GENERAL.--No insured credit union may be sponsored by or 

accept financial support, directly or indirectly, from any Government-sponsored 

enterprise, if the credit union includes the customers of the Governmentsponsored enterprise in the field of membership of the credit union.

(2) ROUTINE BUSINESS FINANCING.--Paragraph (1) shall not apply 

with respect to advances or other forms of financial assistance generally provided 

by a Government-sponsored enterprise in the ordinary course of business of the 

enterprise.

 (3) GOVERNMENT-SPONSORED ENTERPRISE DEFINED.--For 

purposes of this subsection, the term "Government-sponsored enterprise" has the 

meaning given to such term in section 1404(e)(1)(A) of the Financial Institutions 

Reform, Recovery, and Enforcement Act of 1989.

 (4) EMPLOYEE CREDIT UNION.--No provision of this subsection 

shall be construed as prohibiting any employee of a Government-sponsored 

enterprise from becoming a member of a credit union whose field of membership 

is the employees of such enterprise.

* * * * * 
12 U.S.C. 1828 (s) PROHIBITION ON CERTAIN AFFILIATIONS.--

(1) IN GENERAL.--No depository institution may be an affiliate of, be 

sponsored by, or accept financial support, directly or indirectly, from any 

Government-sponsored enterprise.

 (2) EXCEPTION FOR MEMBERS OF A FEDERAL HOME LOAN 

BANK.--Paragraph (1) shall not apply with respect to the membership of a 

depository institution in a Federal home loan bank.

 (3) ROUTINE BUSINESS FINANCING.--Paragraph (1) shall not apply 

with respect to advances or other forms of financial assistance provided by a 

Government-sponsored enterprise pursuant to the statutes governing such 

enterprise.

 (4) GOVERNMENT-SPONSORED ENTERPRISE DEFINED.--For 

purposes of this subsection, the term "Government-sponsored enterprise" has the 

meaning given to such term in section 1404(e)(1)(A) of the Financial Institutions 

Reform, Recovery, and Enforcement Act of 1989. 

* * * * *
Type: Statute

Statute: FARM CREDIT SYSTEM REFORM ACT OF 1996

Title: Title II Regulatory Relief

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2252 note

Date Created: 12/18/2012

Date Modified: 2/15/2018

FARM CREDIT SYSTEM REFORM ACT OF 1996

* * * * *

TITLE II—REGULATORY RELIEF

* * * * *

12 U.S.C. 2252 SEC. 212. REGULATORY REVIEW.

note (a) FINDINGS. Congress finds that—

(1) the Farm Credit Administration, in the role of the 

Administration as an arms-length safety and soundness regulator, has made 

considerable progress in reducing the regulatory burden on Farm Credit 

System institutions;

(2) the efforts of the Farm Credit Administration described in 

paragraph (1) have resulted in cost savings for Farm Credit System 

institutions; and

(3) the cost savings described in paragraph (2) ultimately benefit 

the farmers, ranchers, agricultural cooperatives, and rural residents of the 

United States.

(b) CONTINUATION OF REGULATORY REVIEW. The Farm Credit 

Administration shall continue the comprehensive review of regulations governing 

the Farm Credit System to identify and eliminate, consistent with law, safety, and 

soundness, all regulations that are unnecessary, unduly burdensome or costly, or 

not based on law.

* * * * *
Type: Statute

Statute: FARM CREDIT SYSTEM REFORM ACT OF 1996

Title: Title II Regulatory Relief

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2277a-2 note

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2277a-2 note SEC. 219. FARM CREDIT SYSTEM INSURANCE CORPORATION 

BOARD OF DIRECTORS.

* * * * *

(b) CONFORMING AMENDMENTS.

(1) Section 5314 of title 5, United States Code, is amended by 

striking "Chairperson, Board of Directors of the Farm Credit System Insurance 

Corporation.".

(2) Section 5315 of title 5, United States Code, is amended by 

striking "Members, Board of Directors of the Farm Credit System Insurance 

Corporation.".

* * * * *
Type: Statute

Statute: FARM CREDIT SYSTEM REFORM ACT OF 1996

Title: Title II Regulatory Relief

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2219e 

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2219e SEC. 221. LIABILITY FOR MAKING CRIMINAL REFERRALS.

(a) IN GENERAL. Any institution of the Farm Credit System, or any 

director, officer, employee, or agent of a Farm Credit System institution, that 

discloses to a Government authority information proffered in good faith that may 

be relevant to a possible violation of any law or regulation shall not be liable to 

any person under any law of the United States of any State—

(1) for the disclosure;

(2) for any failure to notify the person involved in the possible 

violation.

(b) NO PROHIBITION ON DISCLOSURE. Any institution of the 

Farm Credit System, or any director, officer, employee, or agent of a Farm Credit 

System institution, may disclose information to a Government authority that may 

be relevant to a possible violation of any law or regulation.

* * * * *
Type: Statute

Statute: FARM CREDIT SYSTEM REFORM ACT OF 1996

Title: Title III Implementation and Effective Date

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note

Date Created: 12/18/2012

Date Modified: 2/15/2018

TITLE III—IMPLEMENTATION AND EFFECTIVE DATE

* * * * *

12 U.S.C. 2001 SEC. 301. IMPLEMENTATION.

note The Secretary of Agriculture and the Farm Credit Administration shall 

promulgate regulations and take other required actions to implement the 

provisions of this Act not later than 90 days after the effective date of this Act.
Type: Statute

Statute: FARM CREDIT SYSTEM REFORM ACT OF 1996

Title: Title III Implementation and Effective Date

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2013 note 

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2013 SEC. 302. EFFECTIVE DATE.

note Except as otherwise provided in this Act, this Act and the amendments 

made by this Act shall become effective on the date of enactment.
Type: Statute

Statute: SAFETY AND SOUNDNESS ACT OF 1992

Title: Title II Farm Credit System Insurance Corporation

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

FARM CREDIT BANKS AND ASSOCIATIONS SAFETY AND 

SOUNDNESS ACT OF 1992

* * * * *

TITLE II—FARM CREDIT SYSTEM INSURANCE CORPORATION

* * * * *

SEC. 204. GAO REPORTS ON RISK-BASED INSURANCE 

PREMIUMS, ACCESS TO ASSOCIATION CAPITAL, SUPPLEMENTAL 

PREMIUMS, AND CONSOLIDATION.

(a) IN GENERAL. The Comptroller General of the United States may 

investigate, review, and evaluate the feasibility and appropriateness, and report to 

the Committee on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate, on the 

advantages and disadvantages of providing the Farm Credit System Insurance 

Corporation with—

(1) the authority to directly or indirectly assess associations to 

ensure that all System capital is available to prevent losses to investors, 

including a study of—

(A) the effects of direct assessments by the Insurance 

Corporation on associations, including interest rate charges to 

borrowers;

(B) the effects of requiring that banks pass along the cost of 

insurance premiums to owner associations and other financing 

institutions having a discount relationship with the bank;

(C) the effects of requiring owner associations to purchase 

stock in the district bank, if needed, to prevent a bank from having to 

return to the Insurance Corporation for financial assistance once the 

assistance has been given;

(D) the effects of the purchase of stock from funds of the 

association (through funds obtained from other than the district bank) 

or allowing the bank to increase the direct line of credit to the 

association in order to fund the purchase; and

(E) the effect that authorizing the Insurance Corporation to 

assess the association could have on the association's incentives for 

building capital;
(2) the authority to collect supplemental insurance premiums 

under certain circumstances, including a study of—

(A) the possibility of the Insurance Fund being depleted 

more rapidly than it could be replenished under the current premium 

structure;

(B) the effects of the depletion under alternate economic 

scenarios and the probability of the occurrence of each of those 

scenarios;

(C) the effects on capital accumulation and interest rates of 

levying a supplemental premium; and

(D) limitations on any authority to levy supplemental 

premiums and the underlying basis for the limitations; and

(3) the authority to establish an insurance premium rate structure 

that would take into account, on an institution-by-institution basis, asset 

quality risk, interest rate risk, earnings, and capital.

(b) REPORT ON CONSOLIDATION.

(1) IN GENERAL. The Comptroller General of the United States 

shall evaluate and report to the Committee on Agriculture of the House of 

Representatives and the Committee on Agriculture, Nutrition, and Forestry 

of the Senate on whether there are likely to be benefits to farmer and 

rancher borrowers of the Farm Credit System institutions of merging the 10 

district Farm Credit Banks (and the Federal Intermediate Credit Bank of 

Jackson) into fewer regional Farm Credit Banks.

(2) FACTORS. In preparing the report, the Comptroller General 

shall consider—

(A) the potential reduction in services to farmers and 

ranchers;

(B) the potential benefits of jointly providing services to 

farmers and ranchers among these proposed regional districts;

(C) any economy of scale effects on a district-by-district 

basis;

(D) the potential impact on the cooperative nature of the 

Farm Credit System;

(E) the potential impact on bank and association 

relationships; and

(F) the potential impact on Systemwide bond issuances.

(c) POTENTIAL SAVINGS. The Comptroller General of the United 

States shall evaluate and report to the appropriate committees of Congress on the 

potential savings to the Farm Credit System and its shareholders that might occur 

if System institutions and the Farm Credit Administration were required to 

comply with General Services Administration standards for office space, 

furniture, and equipment.

(d) DEADLINE. The reports required under this section shall be 

provided to Congress not later than 12 months after the date of enactment of this 

Act.

* * * * *
Type: Statute

Statute: SAFETY AND SOUNDNESS ACT OF 1992

Title: Title IV Clarification of Certain Authorities

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

TITLE IV—CLARIFICATION OF CERTAIN AUTHORITIES

SEC. 401. CLARIFICATION OF THE STATUS AND POWERS OF 

CERTAIN INSTITUTIONS OF THE FARM CREDIT SYSTEM.

NOTE: See section 410(e) of the Agricultural Credit Act of 1987 

added by subsection (a) of this section.

* * * * *

(b) LONG-TERM LENDING AUTHORITY OF THE FARM CREDIT 

BANK OF TEXAS WITH RESPECT TO THE STATES OF ALABAMA, 

LOUISIANA, AND MISSISSIPPI.

(1) IN GENERAL. Notwithstanding any other provision of law 

(except section 7.7 of the Farm Credit Act of 1971), the Farm Credit Bank 

of Texas may act in accordance with the exclusive charter of the bank, as 

amended by the Farm Credit Administration on February 7, 1989, and 

effective February 9, 1989 (except to the extent that the charter may be 

further amended by the Farm Credit Administration in accordance with its 

general authorities under the Farm Credit Act of 1971 (12 U.S.C. 2001 et 

seq.).

(2) EFFECTIVE DATE. Paragraph (1) shall take effect as if such 

paragraph had become law on February 7, 1989.

* * * * *

NOTE: The amendments made by section 5407 of Public Law 110-246 

take effect on January 1, 2010. 
Type: Statute

Statute: SAFETY AND SOUNDNESS ACT OF 1992

Title: Title V Miscellaneous

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

TITLE V—MISCELLANEOUS

* * * * *

SEC. 514. FINANCIAL DISCLOSURE AND CONFLICT OF 

INTEREST REPORTING BY DIRECTORS, OFFICERS, AND 

EMPLOYEES OF FARM CREDIT SYSTEM INSTITUTIONS.

(a) FINDINGS. Congress finds that—

(1) the disclosure of the compensation paid to, loans made to, and 

transactions made with a Farm Credit System institution by, directors and 

senior officers of the institution provides the stockholders of the 

institutions with information necessary to better manage the institutions, 

provides the Farm Credit Administration with information necessary to 

efficiently and effectively regulate the institutions, and enhances the 

financial integrity of the Farm Credit System by making the information 

available to potential investors;

(2) the reporting of potential conflicts of interest by directors, 

officers, and employees of institutions of the Farm Credit System benefits 

the stockholders of the institutions, helps to ensure the financial viability of 

the institutions, provides information valuable to the Farm Credit 

Administration in periodic examinations of the institutions, and therefore 

enhances the safety and soundness of the Farm Credit System; and

(3) the directors, officers, or employees of some Farm Credit 

System institutions may not be subject to the regulations of the Farm 

Credit Administration requiring the disclosure of the financial information 

and the reporting of the potential conflicts of interest.

(b) PURPOSE. It is the purpose of this section to ensure that the 

information reported by the directors, officers, and employees of Farm Credit 

System institutions under regulations of the Farm Credit Administration 

requiring the disclosure of financial information and the reporting of potential 

conflicts of interest—

(1) provides the stockholders of all Farm Credit System 

institutions with information to assist the stockholders in making informed 

decisions regarding the operation of the institutions;

(2) provides investors and potential investors with information 

necessary to assist them in making investment decisions regarding Farm 

Credit System obligations or institutions; and

(3) provides the Farm Credit Administration with information 

necessary to allow the Farm Credit Administration to effectively and 
efficiently examine and regulate all Farm Credit System institutions and 

thus enhance the safety and soundness of the Farm Credit System.

(c) REVIEW. Not later than 120 days after the date of enactment of this 

Act, the Farm Credit Administration shall complete a review of the current 

regulations of the Farm Credit Administration regarding the disclosure of 

financial information and the reporting of potential conflicts of interest by the 

directors, officers, and employees of Farm Credit System institutions. Consistent 

with the purpose of this section as provided in subsection (b), the review shall 

address whether the regulations—

(1) are adequate to fulfill the purpose of this section and such 

other purposes as the Farm Credit Administration determines to be 

consistent with the Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.), and 

other applicable law, and to be otherwise necessary or appropriate;

(2) currently require the disclosure of financial information and 

the reporting of potential conflicts of interest by the directors, officers, and 

employees of all Farm Credit System institutions; and

(3) currently require the disclosure or reporting of the information 

by all of the appropriate directors, officers, or employees of Farm Credit 

System institutions.

(d) IMPLEMENTATION. Not later than 360 days after the date of 

enactment of this Act, the Farm Credit Administration shall amend its current 

financial disclosure and conflict of interest regulations as the Administration 

determines necessary to carry out the purpose of this section and to address any 

deficiencies in the regulations that the Farm Credit Administration determines 

necessary pursuant to the review conducted under subsection (c).
Type: Statute

Statute: TRADE ACT OF 1990

Title: Title XVIII Credit

Part: [Part]

Subtitle: Subtitle B Farm Credit System

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT OF 1990

* * * * *

TITLE XVIII—CREDIT

* * * * *

Subtitle B—Farm Credit System

* * * * *

SEC. 1838. TERMINATION OF SYSTEM INSTITUTION STATUS 

OF CALIFORNIA LIVESTOCK PRODUCTION CREDIT 

ASSOCIATION.

(a) AUTHORITY TO TERMINATE. Notwithstanding any other 

provision of law, effective on the date of enactment of this Act, the California 

Livestock Production Credit Association may terminate the status of the 

Association as a Farm Credit System institution.

(b) REQUIREMENTS. Notwithstanding section 7.10(a)(4) of the Farm 

Credit Act of 1971 (12 U.S.C. 2279(a)(4)), the California Livestock Production 

Credit Association shall not (on termination) be—

(1) required to pay any part of the last $1,000,000 of its capital; or

(2) restricted from transferring any part of the $1,000,000 to its 

successor institution.

* * * * *
Type: Statute

Statute: TRADE ACT OF 1990

Title: Title XVIII Credit

Part: [Part]

Subtitle: Subtitle B Farm Credit System

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note

Date Created: 12/18/2012

Date Modified: 2/15/2018

12 U.S.C. 2001 SEC. 1842. GAO STUDY OF RURAL CREDIT COST AND

note AVAILABILITY.

(a) STUDY. The Comptroller General of the United States shall 

conduct a study of certain matters related to the cost and availability of credit in 

rural America, including a study of—

(1) the relationship of the role and lending volume of the Farm 

Credit System to the ability of the System to repay the assistance provided 

under the Agricultural Credit Act of 1987 (Public Law 100-233) and 

amendments made by such Act;

(2) the ability of Farm Credit System institutions to be competitive 

taking into consideration the costs of rebuilding capital, repaying assistance, 

and capitalizing the Farm Credit Insurance Fund established under section 

5.60 of the Farm Credit Act of 1971 (12 U.S.C. 2277a-9);

(3) the rates Farm Credit Banks charge for credit and the rates 

prevailing in the market for credit of comparable risk and maturity;

(4) the potential for credit pricing practices of rural lending 

institutions to adversely affect the financial soundness of other lending 

institutions that provide agricultural credit;

(5) the pricing practices of commercial lending and insurance 

institutions and whether the practices adequately address the level of risk in 

agricultural lending;

(6) whether the assistance authorized under the Agricultural Credit 

Act of 1987 and the amendments made by such Act, is being utilized in 

accordance with the purposes intended by Congress;

(7) the availability and adequacy of credit in rural America for the 

purpose of financing agricultural production, infrastructure development 

(including development of roads, bridges, and water systems), and rural 

development;

(8) the prudence and desirability for commercial lenders and Farm 

Credit System institutions who serve primarily agriculture to broaden 

lending activity to provide diversity in their portfolios;

(9) the level of competitiveness among the major sector lenders in 

agriculture, whether competition among such lenders has increased or 

decreased in the last 5 years, and whether American producers have 

benefited from the competitive situation; and

(10) the level of farm lending activity, in relation to the total asset 

level, of agricultural lending institutions in rural America and the level of 

investment by the institutions outside of the rural community or area in 

which the lending institutions are located.
(b) REPORT. Not later than 2 years after the date of enactment of this 

Act, the Comptroller General shall submit a report on the study conducted under 

subsection (a) (including any related recommendations) to the Committee on 

Agriculture of the House of Representatives and the Committee on Agriculture, 

Nutrition, and Forestry of the Senate.

* * * * *
Type: Statute

Statute: TRADE ACT OF 1990

Title: Title XVIII Credit

Part: [Part]

Subtitle: Subtitle D Effective Dates

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 2001 note

Date Created: 12/18/2012

Date Modified: 2/15/2018

Subtitle D—Effective Dates

* * * * *

7 U.S.C. 2001 SEC. 1861. EFFECTIVE DATES.

note (a) IN GENERAL. Except as otherwise provided in this title, this title 

and the amendments made by this title shall become effective on the date of 

enactment of this Act.

* * * * *

(d) RESTORATION OF FIRST LIEN ON STOCK. The amendment 

made by section 1833 of this Act shall be effective as of January 7, 1988.

(e) REGULATIONS. As soon as practicable after the date of enactment 

of this Act—

* * * * *

(2) the Farm Credit Administration shall issue such regulations as 

are necessary to carry out subtitle B of this Act and the amendments made 

by such subtitle.

* * * * *
Type: Statute

Statute: OMNIBUS BUDGET RECONCILIATION ACT OF 1990

Title: Title XIII Budget Enforcement

Part: Part II Related Amendments

Subtitle: Subtitle E Government-Sponsored Enterprises

Chapter Name: [Chapter Name]

U.S. Code Citation 2 U.S.C. 621 note 

Date Created: 12/18/2012

Date Modified: 2/15/2018

OMNIBUS BUDGET RECONCILIATION ACT OF 1990

* * * * *

TITLE XIII—BUDGET ENFORCEMENT

* * * * *

PART II--RELATED AMENDMENTS

* * * * *

Subtitle E—Government-Sponsored Enterprises

2 U.S.C. 621 note SEC. 13501. FINANCIAL SAFETY AND SOUNDNESS OF 

GOVERNMENT-SPONSORED ENTERPRISES.

(a) DEFINITION. For the purposes of this section, the terms 

"Government-sponsored enterprise" and "GSE" mean the Farm Credit System 

(including the Farm Credit Banks, Banks for Cooperatives, and Federal 

Agricultural Mortgage Corporation), the Federal Home Loan Bank System, the 

Federal Home Loan Mortgage Corporation, and the Federal National Mortgage 

Association, and the Student Loan Marketing Association.

(b) TREASURY DEPARTMENT STUDY AND PROPOSED 

LEGISLATION.

(1) The Department of the Treasury shall prepare and submit to 

Congress no later than April 30, 1991, a study of GSEs and recommended 

legislation.

(2) The study shall include an objective assessment of the 

financial soundness of GSEs, the adequacy of the existing regulatory 

structure for GSEs, the financial exposure of the Federal Government 

posed by GSEs, and the effects of GSE activities on Treasury borrowing.

(c) CONGRESSIONAL BUDGET OFFICE STUDY.

(1) The Congressional Budget Office shall prepare and submit to 

Congress no later than April 30, 1991, a study of GSEs.

(2) The study shall include an analysis of the financial risks each 

GSE assumes, how Congress may improve its understanding of those risks, 

the supervision and regulation of GSEs' risk management, the financial 

exposure of the Federal Government posed by GSEs, and the effects of 

GSE activities on Treasury borrowing. The study shall also include an 
analysis of alternative models for oversight of GSEs and of the costs and 

benefits of each alternative model to the Government and to the markets 

and beneficiaries served by GSEs.

(d) ACCESS TO RELEVANT INFORMATION.

(1) For the studies required by this section, each GSE shall 

provide full and prompt access to the Secretary of the Treasury and the 

Director of the Congressional Budget Office to its books and records and 

other information requested by the Secretary of the Treasury or the 

Director of the Congressional Budget Office.

(2) In preparing the studies required by this section, the Secretary 

of the Treasury and the Director of the Congressional Budget Office may 

request information from, or the assistance of, any Federal department or 

agency authorized by law to supervise the activities of a GSE.

(e) CONFIDENTIALITY OF RELEVANT INFORMATION.

(1) The Secretary of the Treasury and the Director of the 

Congressional Budget Office shall determine and maintain the 

confidentiality of any book, record, or information made available by a 

GSE under this section in a manner consistent with the level of 

confidentiality established for the material by the GSE involved.

(2) The Department of the Treasury shall be exempt from section 

552 of title 5, United States Code, for any book, record, or information 

made available under subsection (d) and determined by the Secretary of the 

Treasury to be confidential under this subsection.

(3) Any officer or employee of the Department of the Treasury 

shall be subject to the penalties set forth in section 1906 of title 18, United 

States Code, if—

(A) by virtue of his or her employment or official position, 

he or she has possession of or access to any book, record, or 

information made available under and determined to be confidential 

under this section; and

(B) he or she discloses the material in any manner other than:

(i) to an officer or employee of the Department of the 

Treasury; or

(ii) pursuant to the exception set forth in such section 

1906.

(4) The Congressional Budget Office shall be exempt from section 

203 of the Congressional Budget Act of 1974 with respect to any book, 

record, or information made available under this subsection and determined 

by the Director to be confidential under paragraph (1).

(f) REQUIREMENT TO REPORT LEGISLATION.

(1) The committees of jurisdiction in the House shall prepare and 

report to the House no later than September 15, 1991, legislation to ensure 

the financial soundness of GSEs and to minimize the possibility that a GSE 

might require future assistance from the Government.

(2) It is the sense of the Senate that the committees of jurisdiction 

in the Senate shall prepare and report to the Senate no later than September 

15, 1991, legislation to ensure the financial safety and soundness of GSEs 

and to minimize the possibility that a GSE might require future assistance 

from the Government.
(g) PRESIDENT'S BUDGET. The President's annual budget 

submission shall include an analysis of the financial condition of the GSEs and 

the financial exposure of the Government, if any, posed by GSEs.

* * * * *
Type: Statute

Statute: FIRREA, 1989

Title: Title X Studies of Federal Deposit Insurance, Banking Services, and the 

Safety and Soundness of Government-Sponsored Enterprises

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 1811 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

FINANCIAL INSTITUTIONS REFORM, RECOVERY, AND ENFORCEMENT ACT OF 1989

* * * * *

TITLE X—STUDIES OF FEDERAL DEPOSIT INSURANCE, BANKING SERVICES, AND THE 

SAFETY AND SOUNDNESS OF GOVERNMENT-SPONSORED ENTERPRISES

* * * * *

12 U.S.C. 1811 note SEC. 1004. STUDY REGARDING CAPITAL REQUIREMENTS 

FOR GOVERNMENT-SPONSORED ENTERPRISES.

(a) IN GENERAL. The Comptroller General of the United States shall 

conduct a study of the risks undertaken by all government-sponsored enterprises 

and the appropriate level of capital for such enterprises consistent with—

(1) the financial soundness and stability of the governmentsponsored enterprises;

(2) minimizing any potential financial exposure of the Federal 

Government; and

(3) minimizing any potential impact on borrowing of the Federal 

Government.

(b) CONSULTATION AND COOPERATION WITH OTHER 

AGENCIES. The Comptroller General shall determine the structure and 

methodology of the study under this section in consultation with and with the 

cooperation of the Secretary of Agriculture and the Farm Credit Administration 

(with respect to the Farm Credit Banks, the Banks for Cooperatives, and the 

Federal Agricultural Mortgage Corporation), the Secretary of Education (with 

respect to the Student Loan Marketing Association and the College Construction 

Loan Corporation), the Secretary of Housing and Urban Development (with 

respect to the Federal National Mortgage Association and the Federal Home 

Loan Mortgage Corporation), and the government-sponsored enterprises.

(c) ACCESS TO RELEVANT INFORMATION. Each governmentsponsored enterprise shall provide full and prompt access to the Comptroller 

General to its books and records and shall promptly provide any other 

information requested by the Comptroller General. In conducting the study 

under this section, the Comptroller General may request information from, or the 

assistance of, any department or agency of the Federal Government that is 

authorized by law to supervise or approve any of the activities of any 

government-sponsored enterprise.
(d) SPECIFIC REQUIREMENTS. The study shall examine and 

evaluate—

 (1) the degrees and types of risks that are undertaken by the 

government-sponsored enterprises in the course of their operations, 

including credit risk, interest rate risk, management and operational risk, 

and business risk;

 (2) the most appropriate method or methods for quantifying the 

types of risks undertaken by the government-sponsored enterprises;

 (3) the actual level of risk that exists with respect to each 

government-sponsored enterprise, which shall take into account factors 

including the volume and type of securities outstanding that are issued or 

guaranteed by each government-sponsored enterprise and the extent of offbalance-sheet expense of each government-sponsored enterprise;

 (4) the appropriateness of applying a risk-based capital standard to 

each government-sponsored enterprise, taking into account the nature of 

the business each government-sponsored enterprise conducts;

 (5) the costs and benefits to the public from application of a riskbased capital standard to the government-sponsored enterprises and the 

impact of such a standard on the capability of each government-sponsored 

enterprise to carry out its purpose under law;

 (6) the impact, if any, of the operation of the governmentsponsored enterprises on borrowing of the Federal Government;

 (7) the overall level of capital appropriate for each of the 

government-sponsored enterprises; and

 (8) the quality and timeliness of information currently available to 

the public and the Federal Government concerning the extent and nature of 

the activities of government-sponsored enterprises and the financial risk 

associated with such activities.

(e) REPORTS TO CONGRESS. The Comptroller General shall submit 

to the Congress 2 reports regarding the study under this section. The first report 

shall be submitted to the Congress not later than 9 months after the date of the 

enactment of this Act and the second report shall be submitted to the Congress 

not later than 21 months after the date of the enactment of this Act. Each report 

shall set forth—

(1) the results of the study under this section;

(2) any recommendations of the Comptroller General with respect 

to appropriate capital standards for each government-sponsored enterprise;

(3) any recommendations of the Comptroller General with respect 

to information that, in the determination of the Comptroller General, 

should be provided to the Congress concerning—

(A) the extent and nature of the activities of the governmentsponsored enterprises; and

(B) the nature of any periodic reports that the Comptroller 

General believes should be submitted to the Congress relating to the 

capital condition and operations of the government-sponsored 

enterprises; and

(4) any recommendations and opinions of the Secretary of 

Agriculture, the Secretary of Education, the Secretary of Housing and 

Urban Development, and the Secretary of the Treasury regarding the report, 

to the extent that the recommendations and views of such officers differ 

from the recommendations and opinions of the Comptroller General.
(f) DEFINITION. For purposes of this section, the term "governmentsponsored enterprises" means the Federal Home Loan Mortgage Corporation, the 

Federal National Mortgage Association, the Federal Home Loan Bank System, 

the Farm Credit Banks, the Banks for Cooperatives, the Federal Agricultural 

Mortgage Corporation, the College Construction Loan Insurance Corporation, the 

Student Loan Marketing Association.

* * * * *
Type: Statute

Statute: FIRREA, 1989

Title: Title XIV Tax Provisions

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 1811 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

TITLE XIV—TAX PROVISIONS

* * * * *

12 U.S.C. 1811 note SEC. 1404. STUDIES OF RELATIONSHIP BETWEEN PUBLIC 

DEBT AND ACTIVITIES OF GOVERNMENT-SPONSORED 

ENTERPRISES.

(a) IN GENERAL. In order to better manage the bonded indebtedness 

of the United States, the Secretary shall conduct 2 annual studies to assess the 

financial safety and soundness of the activities of all Government-sponsored 

enterprises and the impact of their operations on Federal borrowing.

(b) ACCESS TO RELEVANT INFORMATION.

 (1) INFORMATION FROM GSE'S. Each Government-sponsored 

enterprise shall provide full and prompt access to the Secretary to its books 

and records, and shall promptly provide any other information requested to 

the Secretary.

 (2) INFORMATION FROM SUPERVISORY AGENCIES. In 

conducting the studies under this section, the Secretary may request 

information from, or the assistance of, any Federal department or agency 

authorized by law to supervise the activities of any Government-sponsored 

enterprise.

 (3) CONFIDENTIALITY OF INFORMATION.

(A) IN GENERAL. The Secretary shall determine and 

maintain the confidentiality of any book, record, or information 

made available under this subsection in a manner generally 

consistent with the level of confidentiality established for the 

material by the Government-sponsored enterprise involved.

(B) EXEMPTION FROM PUBLIC DISCLOSURE 

REQUIREMENTS. The Department of the Treasury shall be 

exempt from section 552 of Title 5, United States Code, with respect 

to any book, record, or information made available under this 

subsection and determined by the Secretary to be confidential under 

subparagraph (A).

(C) PENALTY FOR UNAUTHORIZED DISCLOSURE. 

Any officer or employee of the Department of the Treasury shall be 

subject to the penalties set forth in section 1906 of title 18, United 

States Code, if—

 (i) by virtue of his employment or official position, 

he has possession of or access to any book, record, or 
information made available under this subsection and 

determined by the Secretary to be confidential under 

subparagraph (A); and

 (ii) he discloses the material in any manner other than:

(I) to an officer or employee of the Department 

of the Treasury; or

(II) pursuant to the exceptions set forth in such 

section 1906.

(c) ASSESSMENT OF RISK. In assessing the financial safety and 

soundness of the activities of Government-sponsored enterprises, and the impact 

of their activities on Federal borrowing, the Secretary shall quantify the risks 

associated with each Government-sponsored enterprise. In quantifying such risks, 

the Secretary shall determine the volume and type of securities outstanding 

which are issued or guaranteed by each Government-sponsored enterprise, the 

capitalization of each Government-sponsored enterprise, and the degree of risk 

involved in the operations of each Government-sponsored enterprise due to 

factors such as credit risk, interest rate risk, management and operations risk, and 

business risk. The Secretary shall also report on the quality and timeliness of 

information currently available to the public and the Federal Government 

concerning the extent and nature of the activities of Government-sponsored 

enterprises and the financial risk associated with such activities.

(d) REPORTS TO CONGRESS. The Secretary shall submit to the 

Congress

 (1) by May 15, 1990, a report setting forth the results of the 1st 

annual study conducted under this section; and

 (2) by May 15, 1991, a report setting forth the results of the 2nd 

annual study conducted under this section.

(e) DEFINITIONS. For purposes of this section:

 (1) GOVERNMENT-SPONSORED ENTERPRISE. The term 

"Government-sponsored enterprise" means—

 (A) the Federal National Mortgage Association, the Federal 

Home Loan Mortgage Corporation, the Federal Home Loan Bank 

System, the Farm Credit Banks, the Banks for Cooperatives, the 

Federal Agricultural Mortgage Corporation, the Student Loan 

Marketing Association, the College Construction Loan Insurance 

Association, and any of their affiliated or member institutions; and

 (B) any other Government-sponsored enterprise, as 

designated by the Secretary.

 (2) SECRETARY. The term "Secretary" means the Secretary of 

the Treasury or his delegate.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [1] No Title

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2202a note

Date Created: 12/31/2012

Date Modified: 2/15/2018

AGRICULTURAL CREDIT ACT OF 1987

* * * * *

12 U.S.C. 2202a SEC. 102. RESTRUCTURING DISTRESSED LOANS.

note

* * * * *

(b) SENSE OF CONGRESS.—It is the sense of Congress that the banks 

and associations (except banks for cooperatives) operating under the Farm Credit 

Act of 1971 (12 U.S.C. 2001 et seq.) should administer distressed loans to 

farmers with the objective of using the loan guarantee programs of the Farmers 

Home Administration and other loan restructuring measures, including 

participation in interest rate buy-down programs that are Federally or State 

funded, and other Federal and State sponsored financial assistance programs that 

offer relief to financially distressed farmers, as alternatives to foreclosure, 

considering the availability and appropriateness of such programs on a case-bycase basis.

* * * * *
Type: [Document Type]

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [1] No Title

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2278b note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2278b SEC. 206. FINANCIAL REPORT.—

note During the period beginning September 30, 2001, and ending December 31, 2001, 

the Farm Credit Administration shall review and evaluate the financial condition 

of the Farm Credit System and report to the Secretary of the Treasury and the 

appropriate committees of Congress on—

(1) the general financial condition of each System institution;

(2) the total outstanding principal of debt obligations issued under 

section 6.26 of the Farm Credit Act of 1971 (as added by section 201 of 

this Act); and

(3) the ability of each System institution to retire, at par value, 

preferred stock issued by the institution in accordance with section 6.27 of 

the Farm Credit Act of 1971 (as added by section 201 of this Act).

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [2] Title III Capitalization of System Institutions

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2154 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

TITLE III—CAPITALIZATION OF SYSTEM INSTITUTIONS

12 U.S.C. 2154 SEC. 301. CAPITALIZATION OF SYSTEM INSTITUTIONS.

note (a) MINIMUM CAPITAL ADEQUACY STANDARDS.

(1) IN GENERAL.

(A) ESTABLISHMENT. Within 120 days after the date of 

the enactment of this Act, the Farm Credit Administration shall issue 

regulations under section 4.3(a) of the Farm Credit Act of 1971 (12 

U.S.C. 2154(c)) that establish minimum permanent capital adequacy 

standards for Farm Credit System institutions.

(B) BASIS FOR ESTABLISHMENT. The standards 

established under subparagraph (A) shall apply to an institution 

based on the financial statements of the institution prepared in 

accordance with generally accepted accounting principles.

(C) RATIO OF CAPITAL TO ASSETS. The standards 

established under subparagraph (A) shall specify fixed percentages 

representing the ratio of permanent capital of the institution to the 

assets of the institution, taking into consideration relative risk factors 

as determined by the Farm Credit Administration.

(D) PHASE-IN PERIOD. The standards established under 

subparagraph (A) shall be phased in during the 5-year period 

beginning on the date of the enactment of this Act.

(2) EMERGENCY POWER NOT AVAILABLE. The Farm 

Credit Administration shall not invoke the emergency provisions of section 

5.17(c)(2) of the Farm Credit Act of 1971 (12 U.S.C. 2251(c)(2)) with 

respect to the issuance of the proposed regulations required under 

paragraph (1)(A).

(3) PROHIBITIONS DURING TRANSITION PERIOD. During 

the 5-year period specified in paragraph (1)(D), the Farm Credit 

Administration shall not initiate any receivership, conservatorship, 

liquidation, or enforcement action against any System institution certified 

to issue preferred stock under section 6.27 of the Farm Credit Act of 1971 

(as added by section 201 of this Act), solely because of the failure of such 

institution to meet minimum permanent capital adequacy standards unless 

such action is recommended or concurred in by the Farm Credit System 

Assistance Board established under section 6.0 of such Act (as added by 

section 201 of this Act).
(4) PERMANENT CAPITAL. For purposes of this subsection, 

the term "permanent capital" has the same meaning given that term in 

section 4.3A(a)(1) of the Farm Credit Act of 1971.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2011 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

TITLE IV—RESTRUCTURING THE FARM CREDIT SYSTEM

* * * * *

Subtitle B—Merger of System Institutions

12 U.S.C. 2011 SEC. 410. MANDATORY MERGER.

note (a) IN GENERAL. Not later than 6 months after the date of the 

enactment of this section, the Federal land bank and the Federal intermediate 

credit bank of each Farm Credit System district shall merge into a Farm Credit 

Bank in such district pursuant to a plan of merger agreed on by the Boards of 

Directors of such banks and approved by the Farm Credit Administration, or if 

such banks fail to agree, a plan of merger prescribed by the Farm Credit 

Administration. The mergers required by this section shall be implemented 

without regard to title VII.

(b) CAPITAL STOCK. Notwithstanding section 1.6 (as added by 

section 401 of this Act), the number of shares of capital stock issued by a Farm 

Credit Bank to stockholders and other owners of the institution involved in the 

merger, and the rights and privileges of such shares (including voting power, 

redemption rights, preferences on liquidation, and the right to dividends) shall be 

determined by the plan of merger adopted by the merging banks, and shall be 

consistent with section 4.3A and the regulations issued by the Farm Credit 

Administration.

(c) ASSISTANCE. The Assistance Board established under section 6.0

shall direct the Financial Assistance Corporation established under section 6.20

to provide any Farm Credit Bank with that amount of financial assistance as is 

necessary to ensure that the stock of the Farm Credit Bank, upon implementation 

of the merger, has a book value equal to 75 percent of par, and such Farm Credit 

Bank shall be subject to all of the requirements of title VI of the Farm Credit Act 

of 1971.

(d) INITIAL BOARD. Notwithstanding section 1.4 (as added by section 

401 of this Act), the initial board of each Farm Credit Bank shall be composed of 

members of the district board (which is dissolved upon the creation of such bank) 

elected by the production credit associations, Federal land bank associations, and 

stockholders at large. Such initial board shall operate for such term as is agreed 

to by the members of the board, except that such period shall not exceed two 

years. Thereafter the board shall be elected and serve in accordance with the 

provisions of section 1.4 of the Farm Credit Act of 1971.
(e) CLARIFICATION OF AUTHORITY REGARDING REMAINING 

FEDERAL INTERMEDIATE CREDIT BANK.

(1) NEGOTIATED MERGER.

(A) REQUIREMENT.

(i) IN GENERAL. Not later than June 30, 1993, 

except as provided in subparagraph (C), the Federal 

Intermediate Credit Bank of Jackson (as chartered on the date 

of enactment of this subsection) shall merge with a Farm 

Credit Bank pursuant to the procedures prescribed by section 

7.12 of the Farm Credit Act of 1971 (12 U.S.C. 2279f).

(ii) MERGER OF ENTIRE BANK. Notwithstanding 

subparagraph (B), or any other provision of law, the Farm 

Credit Administration shall approve a merger of the Federal 

Intermediate Credit Bank of Jackson only if the Bank (as 

chartered on the date of enactment of this subsection, except as 

provided in subparagraph (B)(ii)(II)(bb)) merges in its entirety 

with a Farm Credit Bank.

(iii) LIMITED LENDING AUTHORITY. 

Notwithstanding any provision of the Farm Credit Act of 1971 

(12 U.S.C. 2001 et seq.)(except section 7.7 of that Act),the 

Farm Credit Bank resulting from a merger under this 

subsection shall have only the lending authorities in the States 

of Alabama, Louisiana, and Mississippi that the constituent 

banks exercised in such States immediately prior to the merger, 

except as may be provided in section 5.17 (a)(2) of such Act 

(12 U.S.C. 2252(a)(2)).

NOTE: The amendments made by section 5407 of Public Law 

110-246 became effective on January 1, 2010.

(B) OPERATING AND MERGER AUTHORITY.

(i) IN GENERAL. Except as provided in clause (ii), 

the Federal Intermediate Credit Bank of Jackson may operate 

subject to such provisions of part A of title II of the Farm 

Credit Act of 1971 (as in effect immediately before the 

amendment made by section 401 took effect) and such 

provisions of the Farm Credit Act of 1971 (12 U.S.C. 2001 et 

seq.) (as in effect after the amendment), as the Farm Credit 

Administration deems appropriate to carry out the purposes of 

this subsection and such Act. This subparagraph shall take 

effect as if it had become law at the same time as the 

amendment made by section 401 and shall remain in effect 

until the Bank's merger with a Farm Credit Bank under this 

subsection, or July 1, 1994, whichever is sooner.

(ii) LIMITATION ON OPERATING AUTHORITY.

(I) IN GENERAL. Notwithstanding clause (i) 

and subparagraph (A)(ii), the authority of the Federal 

Intermediate Credit Bank of Jackson to operate as 

provided under clause (i) shall expire, and the Farm 

Credit Administration shall revoke the Banks charter, 

immediately on the Banks merger with a Farm Credit 
Bank under this subsection, or July 1, 1994, whichever is 

sooner.

(II) DISTRICT BOUNDARY MODIFICATION. 

Notwithstanding clause (i), the authority of the Federal 

Intermediate Credit Bank of Jackson shall not include 

the authority for the Bank to modify, nor shall the Farm 

Credit Administration approve such a modification to, 

the boundaries of the Fifth Farm Credit District to 

reaffiliate any portion of the District with another Farm 

Credit Bank, except

(aa) in the case of the merger of the entire 

Bank as an entity with a Farm Credit Bank such 

that the entire chartered territory of the Federal 

Intermediate Credit Bank of Jackson (except as 

provided in item (bb)) is merged with the Farm 

Credit Bank; and

(bb) in the case of the reaffiliation of the 

Northwest Louisiana Production Credit 

Association with another farm credit district 

pursuant to the Farm Credit Act of 1971 (12 U.S.C. 

2001 et seq.) and any applicable regulations under 

such Act.

(iii) LIMITATION ON AUTHORITY TO MERGE.

(I) IN GENERAL. Notwithstanding clause (i), 

the authority of the Federal Intermediate Credit Bank of 

Jackson to merge with a Farm Credit Bank as provided 

under clause (i) shall expire, and the Farm Credit 

Administration shall revoke the Bank's charter, 

immediately on the Bank's merger with a Farm Credit 

Bank under this subsection, or July 1, 1994, whichever is 

sooner.

(II) BANK INTEGRITY. Notwithstanding 

clause (i), the authority of the Federal Intermediate 

Credit Bank of Jackson to merge with a Farm Credit 

Bank shall be limited to a merger of the Federal 

Intermediate Credit Bank of Jackson (as chartered on the 

date of enactment of this subsection to include the 

territory in the States of Alabama, Louisiana, and 

Mississippi, except as provided in clause (ii)(II)(bb)) as 

a whole entity such that the entire chartered territory of 

the Federal Intermediate Credit Bank of Jackson is 

merged with the Farm Credit Bank.

(III) LIMITATION. Beginning on the date of an 

order issued by the Farm Credit Administration under 

subparagraph (D), the authority of the Federal 

Intermediate Credit Bank of Jackson to merge with a 

Farm Credit Bank shall be limited to the arbitrated 

merger provided for in paragraph (2).

(C) EXTENSION.

(i) LETTER OF INTENT. If no later than June 30, 

1993, the Federal Intermediate Credit Bank of Jackson delivers 
to the Farm Credit Administration a letter of intent to merge 

with a Farm Credit Bank, summarizing the terms and 

conditions of the merger (including, but not limited to, board 

composition, capital structure, exchange, or transfer of equities, 

and termination) signed by the chief executive officer and the 

members of the boards of directors of the Federal Intermediate 

Credit Bank of Jackson and the Farm Credit Bank, the Farm 

Credit Administration shall, on its determination that the letter 

of intent represents a bona fide good faith agreement in 

principle between the two banks to merge, and that there is at 

least a reasonable prospect that the merger will be completed 

in an expeditious manner, grant a one-time extension, until a 

date certain not later than October 31, 1993, of the requirement 

under subparagraph (A). Any extension provided under this 

subparagraph may be conditioned on such terms and 

conditions as the Farm Credit Administration determines 

necessary to ensure that the merger described in the letter of 

intent is completed by the closing date of the extension.

(ii) COMPLIANCE. If the Farm Credit 

Administration grants an extension under clause (i), it shall 

issue an order under subparagraph (D) immediately if—

(I) the Federal Intermediate Credit Bank of 

Jackson, or the Farm Credit Bank that is a signatory to 

the letter of intent under clause (i), provides written 

notification to the Farm Credit Administration that the 

bank does not intend to complete the merger described 

in the letter of intent;

(II) the Farm Credit Administration determines 

that the Federal Intermediate Credit Bank of Jackson is 

not complying with any term or condition on which an 

extension under clause (i) was conditioned; or

(III) the Farm Credit Administration determines 

that the Federal Intermediate Credit Bank of Jackson is 

not pursuing in good faith the merger provided for in the 

letter of intent.

If the Farm Credit Administration issues an order under subparagraph (D) 

pursuant to this clause, the Federal Intermediate Credit Bank of Jackson shall be 

deemed to have failed to comply with the requirements of subparagraph (A).

(D) FAILURE TO MERGE; ISSUANCE OF ORDER. If 

the Federal Intermediate Credit Bank of Jackson fails to comply, or 

notifies the Farm Credit Administration in writing that it does not 

intend to comply, with the requirements of subparagraph(A), the 

Farm Credit Administration shall, within 5 days after the date 

specified in subparagraph (A), or such other date specified by the 

Farm Credit Administration under subparagraph (C), issue, 

notwithstanding any other provision of law, an order requiring the 

Federal Intermediate Credit Bank of Jackson to merge with the Farm 

Credit Bank of Texas in accordance with paragraph (2).

(2) ARBITRATED MERGER.

(A) IN GENERAL. Not later than 30 days after the issuance 

of an order by the Farm Credit Administration under paragraph 
(1)(D), an arbitrator (or panel of arbitrators) shall be named by the 

American Arbitration Association in accordance with the 

Commercial Arbitration Rules of the American Arbitration 

Association to serve as the arbitrator referred to in this paragraph.

(B) DUTIES. The arbitrator shall determine the terms and 

conditions of the merger required under an order issued under 

paragraph (1)(D), such that the terms and conditions are fair and 

equitable to the two banks, their affiliated associations, the 

stockholders and borrowers of the associations, and the other 

institutions of the Farm Credit System, and are designed to protect or 

enhance the safety and soundness of the Farm Credit System. The 

arbitrator shall have the authority to hire staff and secure the services 

of consultants as necessary to discharge the duties of the arbitrator 

under this paragraph.

(C) EXPENSES. Notwithstanding any other provision of 

law, the compensation and expenses of the arbitrator, the fees and 

expenses of the American Arbitration Association, and any expenses 

associated with the referendum required under subparagraph (F) 

shall be paid from the Farm Credit Assistance Fund established 

under section 6.25 of the Farm Credit Act of 1971 (12 U.S.C. 2278b5).

(D) DEVELOPMENT OF MERGER PLANS.

(i) IN GENERAL. Not later than 100 days after the 

issuance of an order by the Farm Credit Administration under 

paragraph (1)(D), the arbitrator shall develop and submit for 

certification to the Farm Credit Administration a plan 

specifying the terms and conditions of the merger of the two 

banks required under this paragraph, such that the terms and 

conditions are fair and equitable to the two banks, their 

affiliated associations, the stockholders or farmer-borrowers of 

the associations, and the other institutions of the Farm Credit 

System, and are designed to protect or enhance the safety and 

soundness of the Farm Credit System. In devising the plan, the 

arbitrator shall, to the extent practicable, achieve the following 

objectives:

(I) Implementation of the preferences expressed 

by the affected and interested parties in submissions 

under clause (ii).

(II) Valuation of assets fairly, equitably, and 

consistently for all parties involved.

(III) Establishment of capitalization and funding 

terms in a manner that treats farmer-borrowers and 

stockholders in the two involved farm credit districts 

equitably and takes account of risk.

(IV) Ensure the viability of the resulting Farm 

Credit Bank and associations of the bank and the ability 

of the resulting bank and associations of the bank to lend 

to eligible borrowers at reasonable and competitive rates 

of interest.

(ii) SUBMISSION OF VIEWS AND 

INFORMATION. The arbitrator shall receive from affected 
and interested parties written submissions, in accordance with 

fair and reasonable procedures established by the arbitrator, 

regarding the terms and conditions of an appropriate plan for 

the merger of the two banks required under this paragraph. 

The Federal Intermediate Credit Bank of Jackson, the Farm 

Credit Bank of Texas, and their affiliated associations shall 

make available all books, records, financial information, and 

other material that the arbitrator determines is necessary to the 

development of the plan or the fulfillment of any other 

requirement under this paragraph. A copy of any submission 

or information provided to the arbitrator by any party under 

this paragraph shall be furnished to the Federal Intermediate 

Credit Bank of Jackson or the Farm Credit Bank of Texas on 

the written request of the bank and at the banks expense. The 

arbitrator shall provide both banks with a reasonable 

opportunity to review and respond to any submission or 

information provided by any party.

(iii) CONTENT OF PLAN; FARM CREDIT Bank. 

The plan developed and submitted under clause (i) shall 

include provisions regarding the following matters:

(I) The initial composition, following the 

merger, of the board of directors of the resulting Farm 

Credit Bank (which shall be subject to change thereafter 

in accordance with the Farm Credit Act of 1971 (12 

U.S.C. 2001 et seq.) and any applicable regulations).

(II) The valuation, for purposes of the merger, of 

the assets and liabilities of the merging banks.

(III) The terms and conditions on which the 

shares of capital stock of the Federal Intermediate Credit 

Bank of Jackson and, if necessary, the Farm Credit Bank 

of Texas, will be converted into shares of the resulting 

Farm Credit Bank.

(IV) The capital structure and capitalization 

levels of the resulting Farm Credit Bank and the 

affiliated associations of the Farm Credit Bank in the 

States of Alabama, Louisiana, and Mississippi as the 

arbitrator determines necessary to carry out the purposes 

of this paragraph (which shall be subject to change 

thereafter in accordance with the Farm Credit Act of 

1971 (12 U.S.C. 2001 et seq.) and any applicable 

regulations).

(V) The terms of financing agreements between 

any production credit associations or agricultural credit 

associations described in clause (iv), and resulting Farm 

Credit Bank (which shall be subject to change thereafter 

in accordance with the Farm Credit Act of 1971 (12 

U.S.C. 2001 et seq.) and any applicable regulations).

(VI) Any other terms and conditions or other 

matters that the arbitrator considers necessary.

(iv) CONTENT OF PLAN; AGRICULTURAL 

CREDIT ASSOCIATIONS. If the arbitrator determines that 
the chartering of agricultural credit associations in the States of 

Alabama, Louisiana, and Mississippi will be in the best 

interests of the farmers, ranchers, and aquatic producers 

eligible to borrow from Farm Credit System associations, the 

plan required under this subparagraph shall also include, based 

on submissions from the Federal Intermediate Credit Bank of 

Jackson and the Farm Credit Bank of Texas, provisions for the 

establishment of agricultural credit associations to operate in 

the States, subject to approval in the referendum under 

subparagraph (F). Such provisions shall include provisions 

regarding the following matters:

(I) A proposal for the establishment of an 

agricultural credit association in each of the geographic 

areas specified in subparagraph (F)(iii) (the charters of 

which, if validly issued under subparagraph (G)(i) 

pursuant to approval in the referendum under 

subparagraph (F), shall be subject to change thereafter in 

accordance with the Farm Credit Act of 1971 (12 U.S.C. 

2001 et seq.) and any applicable regulations).

(II) The initial composition, if the proposal for 

the establishment of agricultural credit associations is 

approved, of the board of directors of each such 

agricultural credit association (which shall be subject to 

change thereafter in accordance with the Farm Credit 

Act of 1971 (12 U.S.C. 2001 et seq.) and any applicable 

regulations).

(III) The valuation, for purposes of the proposed 

merger of the production credit association and the 

Federal land bank association in each of the geographic 

areas specified in subparagraph (F)(iii), of the assets and 

liabilities of the associations.

(IV) The terms and conditions on which the 

shares of capital stock of any associations that may 

merge under the plan to form agricultural credit 

associations will be converted into shares of the resulting 

agricultural credit associations.

(V) The capital structure and capitalization 

levels of the resulting Farm Credit Bank and such 

affiliated associations of the Farm Credit Bank in the 

States of Alabama, Louisiana, and Mississippi as the 

arbitrator determines necessary to carry out the purposes 

of this paragraph (which capital structure and 

capitalization levels shall be subject to change thereafter 

in accordance with the Farm Credit Act of 1971 (12 

U.S.C. 2001 et seq.) and any applicable regulations).

(VI) The terms of financing agreements between 

any agricultural credit associations and the resulting 

Farm Credit Bank (which shall be subject to change 

thereafter in accordance with the Farm Credit Act of 

1971 (12 U.S.C. 2001 et seq.) and any applicable 

regulations).
(VII) Any other terms and conditions or other 

matters that the arbitrator considers necessary.

(v) CONSULTATION WITH INSURANCE 

CORPORATION. The arbitrator shall consult with the Farm 

Credit System Insurance Corporation regarding the valuation 

of the assets and liabilities under the plan of merger, the 

capitalization of the Farm Credit System institutions resulting 

under the plan, and any other matters relevant to the assistance 

to be provided by the Insurance Corporation to facilitate the 

merger under subparagraph (H).

(E) CERTIFICATION OF PLAN. Not later than 30 days 

after the receipt of the plan developed by the arbitrator, the Farm 

Credit Administration shall—

(i) certify; or

(ii) recommend to the arbitrator revisions to the plan 

that, if incorporated into the plan, will allow the Farm Credit 

Administration to certify,

that the resulting bank and any resulting associations are proposed to 

be organized in such a fashion that they will, on implementation of 

the plan, operate in compliance with applicable laws and regulations. 

The arbitrator and the Farm Credit Administration shall work 

cooperatively to ensure the expeditious issuance of the certification. 

If the Farm Credit Administration recommends to the arbitrator 

revisions to plan that, if incorporated into the plan, will allow the 

Farm Credit Administration to certify the plan, the arbitrator shall, 

not later than 15 days after receipt of the recommended revisions, 

incorporate the revisions into the plan as the arbitrator deems 

appropriate to secure the certification.

(F) REFERENDUM ON ASSOCIATION STRUCTURE.

(i) IN GENERAL. Not later than 170 days after the 

issuance of an order by the Farm Credit Administration under 

paragraph (1)(D), the American Arbitration Association shall 

conduct, and compile and forward to the Farm Credit 

Administration the results of, a vote of current farmerborrowers of the production credit associations and the Federal 

land bank associations in the States of Alabama, Louisiana, 

and Mississippi, in accordance with the Election Rules of the 

American Arbitration Association, to determine whether the 

farmer-borrowers of each association in the geographic areas 

described in clause (iii) prefer to have credit delivered—

(I) in the case of production credit association 

farmer-borrowers, through a production credit 

association or through an agricultural credit association 

as proposed in the plan; and

(II) in the case of Federal land bank association 

farmer-borrowers, through a Federal land bank 

association or through an agricultural credit association 

as proposed in the plan.

Each farmer-borrower shall be entitled to one vote. The arbitrator shall 

establish record dates and other procedures for conducting the referendum. 

The Federal Intermediate Credit Bank of Jackson, the Farm Credit Bank of 
Texas, and their affiliated associations shall cooperate in the conduct of the 

referendum, as determined necessary by the Arbitrator.

(ii) DISCLOSURE. The arbitrator shall send to 

farmer-borrowers eligible to vote under this subparagraph, 

with their ballot, a statement describing the potential 

consequences to the farmer-borrowers, and to the associations 

from which they borrow, of voting to charter an agricultural 

credit association and setting forth factors that farmerborrowers should consider relevant to the choice between 

credit delivery through the current association structure and the 

chartering of an agricultural credit association. The arbitrator 

shall develop the disclosure materials in cooperation with the 

Farm Credit Administration and ensure that the materials are 

not inconsistent with applicable laws and regulations.

(iii) TABULATION OF RESULTS. The results of the 

vote under this subparagraph shall be compiled separately for 

production credit association farmer-borrowers and Federal 

land bank association farmer-borrowers in each of the 

following seven geographic areas:

(I) The area served by the Federal Land Bank 

Association of South Mississippi.

(II) The area served by the Federal Land Bank 

Association of North Mississippi.

(III) The area served by the Federal Land Bank 

Association of South Alabama.

(IV) The area served by the Federal Land Bank 

Association of North Alabama.

(V) The area served by the Federal Land Bank 

Association of South Louisiana.

(VI) The area served by both the Federal Land 

Bank Association of North Louisiana and the First South 

Production Credit Association.

(VII) The area served by both the Federal Land 

Bank Association of North Louisiana and the Northwest 

Louisiana Production Credit Association.

(iv) PUBLICATION OF RESULTS. The results of 

the vote under this subparagraph, as tabulated by the American 

Arbitration Association, shall be made promptly available to 

the public in a manner determined appropriate by the Farm 

Credit Administration.

(G) IMPLEMENTATION. Not later than 10 days after the 

date of the receipt of the results of the referendum conducted under 

subparagraph (F), the Farm Credit Administration shall issue such 

charters or charter amendments and take such other regulatory 

actions as may be necessary to implement the merger or mergers as 

provided for under the certified plan. In this regard, the Farm Credit 

Administration shall—

(i) issue a charter or charter amendment and take any 

such other regulatory actions as may be necessary to provide 

for the establishment of an agricultural credit association in 

each of the geographic areas described in subparagraph (F)(iii) 
where a majority of the farmer-borrowers of both the 

production credit association and the Federal land bank 

association voted under subparagraph (F)(i) that they preferred 

to have credit delivered through an agricultural credit 

association (which charter shall be subject to change thereafter 

in accordance with the Farm Credit Act of 1971 (12 U.S.C. 

2001 et seq.) and any applicable regulations); and

(ii) not issue a charter or charter amendment or take 

any such other regulatory action to provide for the 

establishment of an agricultural credit association in any of the 

geographic areas described in subparagraph (F)(iii) where less 

than a majority of the farmer-borrowers of the production 

credit association or the Federal land bank association voted in 

the referendum under subparagraph (F)(i) that they preferred to 

have credit delivered through an agricultural credit association 

(provided that the charter of any remaining association in such 

geographic area shall be subject to change thereafter in 

accordance with the Farm Credit Act of 1971 (12 U.S.C. 2001 

et seq.) and any applicable regulations).

(H) FACILITATION.

(i) IN GENERAL. Beginning on the date of the 

issuance of an order by the Farm Credit Administration under 

paragraph (1)(D), the Farm Credit System Insurance 

Corporation shall expend amounts from the Farm Credit 

Insurance Fund to the extent necessary to facilitate the merger 

prescribed in the plan.

(ii) MAINTENANCE OF BOOK VALUE. 

Assistance provided by the Corporation under this 

subparagraph shall be in amounts not to exceed that required 

to maintain book value per share of stockholders' equity at the 

same value reflected on the most recent audited financial 

statements of the Federal Intermediate Credit Bank of Jackson 

and the Farm Credit Bank of Texas prior to or effective with 

the date of the merger.

(iii) OTHER ASSISTANCE. Until the expiration of 5 

years from the effective date of a merger authorized by this 

subsection, or the final resolution of any litigation against the 

Federal Intermediate Credit Bank of Jackson or any of its 

stockholders pending on the date of the enactment of this 

subsection, whichever is later, the Corporation shall guarantee 

prompt payment of any loss experienced by the merged bank, 

which loss is caused by the failure of any associationstockholder of the merged bank that was a stockholder of the 

Federal Intermediate Credit Bank of Jackson immediately prior 

to the merger, or any successor to the association, to pay when 

due any obligation of principal or interest owed by the 

association or its successor to the resulting bank.

(iv) TERMS AND CONDITIONS. Assistance 

provided by the Corporation under this subparagraph shall be 

on such terms and conditions as the Corporation deems 

appropriate to facilitate the merger.
(I) SAFETY AND SOUNDNESS.

(i) IN GENERAL. Except as provided in clause (ii), 

if at any time prior to the completion of the merger required 

under this subsection the Farm Credit Administration 

determines that the Federal Intermediate Credit Bank of 

Jackson is being operated in an unsafe or unsound manner (as 

determined in accordance with the Farm Credit Act of 1971 

(12 U.S.C. 2001 et seq.)), the Farm Credit Administration, 

after consultation with the respective boards of directors of the 

affected banks and taking into consideration the purposes of 

this subsection, may require the Federal Intermediate Credit 

Bank of Jackson to merge with a Farm Credit Bank, subject to 

such terms and conditions as the Farm Credit Administration 

may prescribe. The Farm Credit System Insurance 

Corporation shall expend amounts in the Farm Credit 

Insurance Fund to the extent necessary to facilitate the merger 

prescribed under this subparagraph, including the provision of 

assistance as provided in section 5.61(a)(2)(A)(iii) of the Farm 

Credit Act of 1971 (12 U.S.C. 2277a-10(a)(2)(A)(iii)), on such 

terms and conditions as the Corporation deems appropriate.

(ii) ARBITRATED MERGER. If at any time after the 

Farm Credit Administration issues an order under paragraph 

(1)(D), but prior to the completion of the merger required 

under this subsection, the Farm Credit Administration 

determines that the Federal Intermediate Credit Bank of 

Jackson is being operated in an unsafe or unsound manner (as 

determined in accordance with the Farm Credit Act of 1971 

(12 U.S.C. 2001 et seq.)), the Farm Credit Administration shall, 

after consultation with the boards of directors of the Federal 

Intermediate Credit Bank of Jackson and the Farm Credit Bank 

of Texas, take such action as it deems necessary pursuant to 

the authorities provided under the Farm Credit Act of 1971 (12 

U.S.C. 2001 et seq.) to return the operation of the Federal 

Intermediate Credit Bank of Jackson to a safe and sound 

condition, pending the completion of the merger under 

paragraph (2).

(J) MERGER PLAN FOR AGRICULTURAL CREDIT 

ASSOCIATIONS. In any of the States of Alabama, Louisiana, or 

Mississippi where all of the associations are chartered as agricultural 

credit associations, the boards of directors of each such association in 

each State are encouraged to submit to the farmer-borrowers of each 

such association for their approval a plan for merging the 

associations into one statewide agricultural credit association, in 

accordance with the applicable provisions of the Farm Credit Act of 

1971 (12 U.S.C. 2001 et seq.).

(K) DEFINITIONS. As used in this paragraph:

(i) AGRICULTURAL CREDIT ASSOCIATIONS. 

The term "agricultural credit association" means an association 

having the same authorities, attributes, and obligations as, and 

for all purposes an agricultural credit association resulting 

from the implementation of the plan under this paragraph shall 
be deemed to be, an association resulting from the merger of a 

production credit association and a Federal land bank 

association under section 7.8 of the Farm Credit Act of 1971 

(12 U.S.C. 2279c-1).

(ii) FARMER-BORROWER. The term "farmerborrower" means a borrower from a Farm Credit System 

association in the State of Alabama, Louisiana, or Mississippi 

who holds voting stock, or is eligible to hold voting stock, in 

the association or a stockholder in any such association.

(3) REVIEW.

(A) IN GENERAL. Actions and determinations of the 

arbitrator, the Farm Credit Administration, or the Farm Credit 

System Insurance Corporation pursuant to this subsection shall not 

be subject to judicial review except as provided in this paragraph, 

nor shall they be subject to the requirements of subchapter II of 

chapter 5 or chapter 7 of title 5, United States Code.

(B) AGENCY DETERMINATIONS.

(i) IN GENERAL. Any petition for review of a 

determination or other action of the Farm Credit 

Administration or the Farm Credit System Insurance 

Corporation under this subsection shall be filed in the United 

States Court of Appeals for the District of Columbia Circuit 

not later than 10 days after the determination, or the petition 

shall be barred. The court shall have exclusive jurisdiction to 

determine the proceeding in accordance with standard 

procedures as supplemented by procedures hereinafter 

provided and no other district court or court of appeals of the 

United States shall have jurisdiction over any such challenge in 

any proceeding instituted prior to, on, or after the date of 

enactment of this subsection. The review of any determination 

or action of the Farm Credit Administration or the Farm Credit 

System Insurance Corporation under this subsection shall be 

based on the examination of all of the information before the 

Farm Credit Administration or the Farm Credit System 

Insurance Corporation, as the case may be, at the time the 

determination was made. The court reviewing the 

determination or action shall not enter a stay or order of 

mandamus unless the court has determined, after notice and a 

hearing before a panel of the court, that the agency action 

complained of was arbitrary, capricious, an abuse of discretion, 

or otherwise not in accordance with law.

(ii) PROCEDURES. Notwithstanding any other 

provision of law, the court may set rules governing the 

procedures of any such proceeding that set page limits on 

briefs and time limits for filing briefs and motions and other 

actions that are shorter than the limits specified in the Federal 

Rules of Civil or Appellate Procedure.

(iii) EXPEDITED REVIEW. Any such proceeding 

before the court shall be assigned for hearing and completed at 

the earliest possible date, and shall be expedited in every way. 

The court shall render its final decision relative to any 
challenge not later than 50 days from the date the challenge is 

brought unless the court determines that a longer period of 

time is required to satisfy the requirements of the Constitution.

(C) ARBITRATOR DETERMINATIONS.

(i) IN GENERAL. Except as otherwise provided in 

this paragraph, any petition for review of a determination or 

other action of the arbitrator named under paragraph (2) shall 

be filed in accordance with the United States Arbitration Act 

(9 U.S.C. 1 et seq.). Such Act shall apply to the arbitration 

conducted pursuant to paragraph (2) to the same extent as if 

the arbitration were established in a contract evidencing a 

transaction in commerce between the Federal Intermediate 

Credit Bank of Jackson and the Farm Credit Bank of Texas.

(ii) PROCEDURES. Notwithstanding the United 

States Arbitration Act (9 U.S.C. 1 et seq.), any petition for 

review of a determination or other action of the arbitrator 

under this subsection shall be filed not later than 10 days after 

the determination, or the petition shall be barred. The court 

specified under such Act shall have exclusive jurisdiction to 

determine the proceeding in accordance with the applicable 

procedures under such Act, as supplemented by procedures 

hereinafter provided, and no other district court shall have 

jurisdiction over any such challenge in any such proceeding. 

Notwithstanding any other provision of law, the court may set 

rules governing the procedures of any such proceeding that set 

page limits on briefs and time limits for filing briefs and 

motions and other actions that are shorter than the limits 

specified in the United States Arbitration Act or the Federal 

Rules of Civil or Appellate Procedure.

(iii) EXPEDITED REVIEW. Any such proceeding 

before the court shall be assigned for hearing and completed at 

the earliest possible date, and shall be expedited in every way. 

The court shall render its final decision relative to any 

challenge as soon as possible in accordance with the United 

States Arbitration Act (9 U.S.C. 1 et seq.), or not later than 30 

days from the date the challenge is brought, whichever is 

sooner, unless the court determines that a longer period of time 

is required to satisfy the requirements of the Constitution.

NOTE: This subsection was added by section 401(a) of Public Law 102-552.
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2071 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2071 note SEC. 411. MERGER OF PRODUCTION CREDIT 

ASSOCIATIONS AND FEDERAL LAND BANK ASSOCIATIONS.

(a) SUBMISSION OF PROPOSAL. Not later than 6 months after the 

date of the merger of the Federal land bank and the Federal intermediate credit 

bank in a district, the Boards of Directors of each Federal land bank association 

and each production credit association in such district, that share substantially the 

same geographical territory with each other, shall submit to the voting 

stockholders of each such association for their approval, a plan approved by the 

supervising bank and the Farm Credit Administration, for merging such 

associations.

(b) PREREQUISITES TO MERGER.

(1) STOCKHOLDER VOTE. The stockholder vote required for 

approval of a merger under subsection (a) shall be a majority of the voting 

stockholders of each association voting, in person or by written proxy, at a 

duly authorized stockholders meeting.

(2) SUBMISSION TO FCA. Not later than 60 days prior to the 

end of the 12-month period beginning on the date of the enactment of this 

section, the plan of merger under subsection (a), together with all 

information to be presented to the stockholders, shall be submitted to the 

Farm Credit Administration.

(3) EXPEDITED CONSIDERATION BY FCA. The Farm Credit 

Administration shall expedite its consideration of the plan and 

accompanying information submitted under paragraph (2) so that review 

and approval of such plan and information shall be completed by the 

Administration so as to enable a stockholder vote to occur within the 12-

month period referred to in paragraph (2).

(c) DIRECT LENDERS. On approval of a merger under this subsection, 

the resulting association shall be a direct lender in the same manner as applies to 

production credit associations.
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2002 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2002 note SEC. 412. CONSOLIDATION OF DISTRICT FARM CREDIT 

BANKS.

(a) SUBMISSION OF PROPOSAL.

(1) SPECIAL COMMITTEE.

(A) IN GENERAL. Not later than 6 months after the date of 

the enactment of this section, a special committee shall be selected 

pursuant to regulations of the Farm Credit Administration for the 

purpose of developing a proposal for the consolidation of Farm 

Credit System districts.

(B) COMPOSITION. The special committee selected under 

subparagraph (A) shall be composed of one representative from each 

Farm Credit Bank board and the members of the Board of Directors 

of the Assistance Board.

(2) DEVELOPMENT OF PROPOSAL. Not later than 6 months 

after the formation of the special committee, the committee shall develop a 

proposal to consolidate the Farm Credit Banks into no less than six 

financially viable Farm Credit Banks through interdistrict mergers.

(3) REPORTS. Not later than the end of each calendar quarter 

beginning at least 6 months after the selection of the special committee, 

such committee shall prepare and submit, to the Committee on Agriculture 

of the House of Representatives, and the Committee on Agriculture, 

Nutrition, and Forestry of the Senate, a report on the progress of the 

committee in developing a proposal under this subsection.

(b) PREREQUISITES TO CONSOLIDATION.

(1) FCA REVIEW OF PROPOSAL. Prior to the submission of 

the proposal developed under subsection (a)(2) to the stockholders under 

paragraph (3), the proposal together with all information to be presented to 

the stockholders, shall be submitted to the Farm Credit Administration for 

approval.

(2) PREREQUISITES. The proposal developed under subsection 

(a)(2) shall not be submitted to stockholders under paragraph (3) unless the 

proposal is approved by—

(A) a majority of the members of the Board of Directors of 

the Assistance Board; and

(B) the members of the special committee that represent the 

districts affected by the terms of the proposal.

(3) SUBMISSION TO STOCKHOLDERS. Not later than the end 

of the 18-month period after the date of enactment of this Act, each Farm 

Credit Bank involved, in consultation with the special committee, shall 
submit the proposed merger affecting such bank to the voting stockholders 

of each such bank.

(4) STOCKHOLDER VOTE. Each association shall be entitled to 

cast a number of votes equal to the number of voting stockholders of such 

association.
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2121 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2121 note SEC. 413. VOLUNTARY MERGER OF THE BANKS FOR 

COOPERATIVES.

(a) SUBMISSION OF PROPOSAL.

(1) SPECIAL COMMITTEE.

(A) IN GENERAL. Not later than 15 days after the date of 

the enactment of this section, a special committee shall be selected 

pursuant to subparagraph (B), for the purpose of developing a 

proposal for the voluntary merger of the banks for cooperatives.

(B) COMPOSITION. The special committee selected under 

subparagraph (A) shall be composed of—

(i) one member of each district board elected by the 

voting stockholders of the bank for cooperatives in the district; 

and

(ii) one member chosen from the board of directors of 

the Central Bank for Cooperatives by the board of such Bank.

(C) DEVELOPMENT OF PLAN. Not later than 75 days 

after the date of the enactment of this section, the special committee 

shall develop a plan of merger for all such banks and the Central 

Bank for Cooperatives into a National Bank for Cooperatives.

(2) PREREQUISITES TO MERGER.

(A) SUBMISSION TO FCA. On completion of the plan of 

merger pursuant to subparagraph (C), the special committee shall 

submit the proposed plan, together with all information that is to be 

distributed to the stockholders concerning such plan, to the Farm 

Credit Administration for approval.

(B) EXPEDITED REVIEW. Not later than 30 days after the 

Farm Credit Administration receives the plan of merger, the 

Administration shall promptly review such plan and advise the 

special committee concerning any required changes that are 

necessary to the plan.

(3) SUBMISSION TO STOCKHOLDERS. On approval of the

plan by the Farm Credit Administration, the special committee shall, under 

such procedures as may be established by the committee, submit the plan 

and recommendations to all voting stockholders of the district banks for 

cooperatives and the Central Bank for Cooperatives.

(b) VOTING REQUIREMENTS.

(1) MAJORITY VOTE REQUIRED. An approval of the plan of 

merger developed and submitted under subsection (a) shall—
(A) require a majority vote of the stockholders of each 

district bank for cooperatives voting, in person or by proxy, at a duly 

authorized stockholders meeting, computed both—

(i) in accordance with the requirement that, except as 

provided in section 3.3(d), each cooperative that is the holder 

of voting stock in the bank for cooperatives shall be entitled to 

cast one vote; and

(ii) on the basis of the total equity interests in the bank 

(including allocated, but not unallocated, surplus and reserves) 

held by such stockholders;

(B) require a majority vote of the voting stockholders of the 

Central Bank for Cooperatives voting on a one bank-one vote basis;

(C) take place not later than 180 days after the date of the 

enactment of this section; and

(D) take place prior to any other merger vote involving a 

bank for cooperatives.

(2) APPROVAL BY ALL BANKS FOR COOPERATIVES. If 

the stockholders of all of the banks for cooperatives approve the merger, 

the merger shall take place.

(3) EFFECT OF LESSER VOTE. If the stockholders of more 

than one but fewer than all of the banks approve the plan, each such bank 

whose stockholders voted to approve the merger shall be merged into a 

single bank for cooperatives, as provided in paragraphs (4) or (5).

(4) NATIONAL BANK FOR COOPERATIVES.

(A) CREATION. If the stockholders of eight or more of the 

district banks for cooperatives approve the merger, such banks, and 

the Central Bank for Cooperatives, shall be merged into a single 

bank, which shall be referred to as the "National Bank for 

Cooperatives."

(B) SERVICES PROVIDED. The National Bank for 

Cooperatives may offer credit and related services to eligible 

borrowers located within any territory that may be served by Farm 

Credit System institutions under section 5.0, or to any borrower 

otherwise eligible under section 3.7(b).

(5) UNITED BANK FOR COOPERATIVES.

(A) CREATION. If the stockholders of more than one but 

fewer than eight of the district banks approve the plan, each such 

bank, and the Central Bank for Cooperatives (if approved by a 

numerical majority of its stockholders), shall be merged into a single 

bank, which shall be referred to as the "United Bank for

Cooperatives."

(B) SERVICES PROVIDED. The United Bank for 

Cooperatives shall offer credit and related services only in the 

territory included, as of the date of the enactment of this section, 

within the boundaries of the districts that had been served by the 

constituent banks of the United Bank for Cooperatives, and to any 

borrower otherwise eligible under section 3.7(b).

(6) NONCONSENTING BANKS.

(A) IN GENERAL.

(i) NATIONAL BANK FOR COOPERATIVES. 

Any of the district banks whose stockholders did not approve 
the plan of merger may offer credit and related services to any 

eligible borrowers within any territory or area that may be 

served by the National Bank.

(ii) UNITED BANK FOR COOPERATIVES. Any of 

the district banks whose stockholders did not approve the plan 

of merger shall continue as district banks for cooperatives and 

shall continue to serve only the territory within the boundaries 

of the district that such banks served as of the date of the 

enactment of this section.

(B) NONDISCRIMINATION. Any district bank whose 

stockholders did not approve the plan of merger shall be entitled to 

the availability, from the National Bank for Cooperatives or the 

United Bank for Cooperatives, as the case may be, of the same credit 

and related services now provided by the Central Bank for 

Cooperatives as of the date of the enactment of this section, 

regardless of the decision not to merge.

(C) SUBSEQUENT MERGERS. Any district bank referred 

to in subparagraph (A) may subsequently merge with the National 

Bank for Cooperatives or the United Bank for Cooperatives, as the 

case may be, on the approval of the voting stockholders of both 

banks proposing to merge based on the voting requirement of 

subsection (b)(1).

(c) REFERENCES. References in this section to voting stockholders 

shall include subscribers to the guaranty fund.
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2121 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2121 SEC. 414. BANK FOR COOPERATIVES BOARD OF DIRECTORS.

note Notwithstanding section 3.2, the initial board of each district bank for 

cooperatives shall be composed of the members of the district board (which is 

dissolved upon the creation of the district Farm Credit Bank) elected by the 

stockholders of the bank for cooperatives and one member elected by the other 

two members, which member shall not be a director, officer, employee, or 

stockholder of a System institution. The initial board shall operate for such term 

as is agreed to by the members of the board, except that such period shall not 

exceed two years. Thereafter, the board shall be elected and serve in accordance 

with section 3.0 of the Farm Credit Act of 1971.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2218 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2218 note SEC. 422. SALES OF INSURANCE BY SYSTEM INSTITUTIONS.

* * * * *

(b) CONTINUATION OF PROGRAM. Notwithstanding the 

amendments made to section 4.29 by subsection (a), any insurance program 

offered by any bank or association of the Farm Credit System on the date of the 

enactment of this Act that does not meet the requirements of section 4.29, as so 

amended, may be continued until July 1, 1988.

NOTE: The amendments to section 4.29 of the 1971 Act include the addition 

of the last sentence in paragraph (a)(1) and new paragraph (a)(2).

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2252 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2252 note SEC. 424. LIMITATION ON FCA AUTHORITY TO REQUIRE 

DISCLOSURE OF INFORMATION.

* * * * *

(b) REGULATIONS. Within 30 days after the date of the enactment of 

this Act, the Farm Credit Administration shall amend its regulations as necessary 

to implement the amendment made by subsection (a).

NOTE: The amendments made by subsection (a) are contained in the last 

proviso and in subparagraphs (A) and (B) of section 5.17(a)(9) of the 1971 

Act.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [3] Title IV Restructuring the Farm Credit System

Part: [Part]

Subtitle: Subtitle B Merger of System Institutions

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2071 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2071 note SEC. 433. REASSIGNMENT OF ASSOCIATIONS TO ADJOINING 

DISTRICTS.

(a) PETITION OF BANK. Notwithstanding any other provision of law, 

effective for the 12-month period beginning on the date of enactment of this Act, 

each Federal land bank association or production credit association, whose 

chartered territory adjoins the territory of another district, may petition the Farm 

Credit Administration to amend the charters of the association and the adjoining 

district bank to provide that the territory of the association is part of the adjoining 

district.

(b) REQUIREMENTS OF PETITION. To be considered under this 

section, the petition must be signed by not less than 15 percent of the 

stockholders of the association. Only one such petition may be filed by an 

association under this section.

(c) FCA ACTION. The Farm Credit Administration shall take any 

action necessary—

(1) to amend the charters of the association and the district bank; 

and

(2) to incorporate the petitioning association into the adjoining 

district if the reassignment is approved by—

(A) a majority of the stockholders of the association voting, 

in person or by proxy, at a duly authorized stockholders' meeting 

held for such purpose;

(B) the board of directors of the adjoining district bank;

(C) the Farm Credit System Assistance Board; and

(D) the Farm Credit Administration Board.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [4] Title V State Mediation Programs

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 5103

Date Created: 12/31/2012

Date Modified: 2/15/2018

TITLE V—STATE MEDIATION PROGRAMS

* * * * *

7 U.S.C. 5103 SEC. 503. PARTICIPATION OF FEDERAL AGENCIES.

* * * * *

(b) DUTIES OF THE FARM CREDIT ADMINISTRATION. The Farm 

Credit Administration shall prescribe rules requiring the institutions of the Farm 

Credit System—

(1) to cooperate in good faith with requests for information or 

analysis of information made in the course of mediation under any 

agricultural loan mediation program described in section 501; and

(2) to present and explore debt restructuring proposals advanced in 

the course of such mediation.

NOTE: Section 501 of the Agricultural Credit Act of 1987 is codified at 7 

U.S.C. 5101.
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [4] Title V State Mediation Programs

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 7 U.S.C. 5104

Date Created: 12/31/2012

Date Modified: 2/15/2018

7 U.S.C. 5104 SEC. 5O4. REGULATIONS.

Within 150 days after the date of the enactment of this Act, the Secretary 

and the Farm Credit Administration shall prescribe such regulations as may be 

necessary to carry out this subtitle.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [5] Title VII Agricultural Mortgage Secondary Markets

Part: [Part]

Subtitle: Subtitle A The Federal Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa note

Date Created: 12/31/2012

Date Modified: 2/15/2018

TITLE VII—AGRICULTURAL MORTGAGE SECONDARY MARKETS

Subtitle A--The Federal Agricultural Mortgage Corporation

12 U.S.C. 2279aa SEC. 701. STATEMENT OF PURPOSE.

note It is the purpose of this subtitle—

(1) to establish a corporation chartered by the Federal Government;

(2) to authorize the certification of agricultural mortgage 

marketing facilities by the corporation;

(3) to provide for a secondary marketing arrangement for 

agricultural real estate mortgages that meet the underwriting standards of 

the corporation—

(A) to increase the availability of long-term credit to farmers 

and ranchers at stable interest rates;

(B) to provide greater liquidity and lending capacity in 

extending credit to farmers and ranchers; and

(C) to provide an arrangement for new lending to facilitate 

capital market investments in providing long-term agricultural 

funding, including funds at fixed rates of interest; and

(4) to enhance the ability of individuals in small rural communities 

to obtain financing for moderate-priced homes.

NOTE: See Title VIII of the 1971 Act for the provisions relating to the 

Federal Agricultural Mortgage Corporation.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [5] Title VII Agricultural Mortgage Secondary Markets

Part: [Part]

Subtitle: Subtitle A The Federal Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 31 U.S.C. 9105(a)(4)

Date Created: 12/31/2012

Date Modified: 2/15/2018

31 U.S.C. 9105(a)(4) SEC. 703. GAO AUDIT OF FEDERAL AGRICULTURAL 

MORTGAGE CORPORATION.

Section 9105(a) of title 31, United States Code, is amended by adding at 

the end thereof the following new paragraph:

(4) FEDERAL AGRICULTURAL MORTGAGE 

CORPORATION. 

(A) AUDITS AUTHORIZED. Notwithstanding any other 

provision of law and under such regulations as the Comptroller 

General may prescribe, the Comptroller General shall perform a 

financial audit of the Federal Agricultural Mortgage Corporation on 

whatever basis the Comptroller General determines to be necessary.

(B) COOPERATION OF CORPORATION REQUIRED. 

The Federal Agricultural Mortgage Corporation shall—

(i) make available to the Comptroller General for 

audit all records and property of, or used or managed by, the 

Corporation which may be necessary for the audit, and

(ii) provide the Comptroller General with facilities for 

verifying transactions with the balances or securities held by 

any depositary, fiscal agent, or custodian.
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [5] Title VII Agricultural Mortgage Secondary Markets

Part: [Part]

Subtitle: Subtitle A The Federal Agricultural Mortgage Corporation

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2279aa note

Date Created: 12/31/2012

Date Modified: 2/15/2018

12 U.S.C. 2279aa SEC. 704. GAO STUDIES.

note (a) STUDIES REQUIRED. The Comptroller General of the United 

States shall conduct studies of the following:

(1) The implementation of the amendments made by this subtitle 

by the Federal Agricultural Mortgage Corporation and the effect of the 

operations of the Corporation on producers, the Farm Credit System, and 

other lenders, and the capital markets.

(2) The feasibility and appropriateness of promoting the 

establishment of a secondary market for securities representing interests in, 

or obligations backed by, pools of agricultural real estate loans for which a 

guarantee has not been provided by the Federal Agricultural Mortgage 

Corporation.

(3) The feasibility of expanding the authority granted under the 

amendments made by this subtitle to authorize the sale of securities based 

on or backed by a trust or pool consisting of loans made to farm-related 

and rural small businesses. For purposes of the preceding sentence, the 

term "farm-related businesses" means businesses 90 percent or more of the 

annual dollar volume of the sales of which are made to agricultural 

producers.

(b) SUBMISSION OF REPORT. Not later than 2 years after the date of 

enactment of this Act, the Comptroller General of the United States shall transmit 

to the Congress a report on the studies required by subsection (a), including 

therein such recommendations for administrative action and legislation as may be 

appropriate.

* * * * *
Type: Statute

Statute: AGRICULTURAL CREDIT ACT OF 1987

Title: [6] Title IX Regulations

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

TITLE IX--REGULATIONS

12 U.S.C. 2001 SEC. 901. EFFECTIVE DATES.

note (a) ISSUANCE OF REGULATIONS.

(1) AUTHORITY. The Farm Credit Administration Board shall 

issue such regulations as the Board considers necessary for the orderly and 

efficient implementation of the provisions of, and the amendments made 

by, this Act relating to the Farm Credit Act of 1971 (12 U.S.C. 2001 et 

seq.).

(2) TIMING. To the extent the Farm Credit Administration is 

required to issue regulations to implement this Act and the amendments 

made by this Act, the Farm Credit Administration shall issue such 

regulations as expeditiously as possible, and, except as otherwise provided 

in this Act, not later than 180 days after the date of the enactment of this 

Act.

(b) TEMPORARY RETENTION OF CERTAIN REGULATIONS.

(1) IN GENERAL. Except as otherwise provided in this 

subsection, the regulations issued by the Farm Credit Administration 

before the date of the enactment of the Act under provisions amended by 

this Act shall remain in effect, notwithstanding such amendments, until the 

Farm Credit Administration issues regulations to implement such 

amendments, but in no event later than 180 days after such date of 

enactment.

(2) CERTAIN REGULATIONS RELATING TO BORROWERS' 

RIGHTS. The regulations implementing, interpreting, or applying part C 

of title IV (12 U.S.C. 2201 et seq.) (other than section 4.13(a)) (in effect 

immediately before the date of the enactment of this Act), to the extent that 

such regulations are not contrary to this title, and the amendments made by 

this Act shall remain in effect until January 1, 1989.

(3) REGULATIONS RELATING TO DISCLOSURE BY 

BANKS AND ASSOCIATIONS. Any regulation issued or approved by 

the Farm Credit Administration that implements, interprets, or applies 

section 4.13(a) (12 U.S.C. 2201(a)) (in effect immediately before the date 

of the enactment of this Act) shall remain in effect for 120 days after such 

date of enactment.

* * * * *

Type: Statute

Statute: FARM CREDIT AMENDMENTS ACT OF 1985

Title: Title V National Commission on Agricultural Finance

Part: [Part]

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 2001 note

Date Created: 12/31/2012

Date Modified: 2/15/2018

FARM CREDIT AMENDMENTS ACT OF 1985

TITLE V—NATIONAL COMMISSION ON AGRICULTURAL FINANCE

12 U.S.C. 2001 SEC. 501. COMMISSION. 

note (a) The President shall appoint a National Commission on Agricultural 

Finance. Such Commission shall be comprised of 15 members, of whom 7 shall 

be appointed by the President and 4 each by the Speaker of the House of 

Representatives and the President pro tempore of the Senate. The Commission 

shall consist of representatives of the financial community, the agricultural sector, 

and government.

(b) The National Commission on Agricultural Finance shall conduct a 

study of methods to ensure the availability of adequate credit to agricultural 

producers and agribusiness, taking into account the long-term financing needs of 

the agricultural economy; the roles of the commercial banks, the Farm Credit 

System, and the Farmers Home Administration in meeting those financial needs.

(c) In conducting such study, the National Commission on Agricultural 

Finance shall—

(1) evaluate the financial circumstances relative to both lenders 

and borrowers of farm credit;

(2) evaluate the structure, performance, and conduct of private 

lenders—commercial bankers and the Farm Credit System—and public 

lenders;

(3) explore the need for long-term assistance in stabilizing the 

value of agricultural assets; and 

(4) evaluate the effect on suppliers, producers, processors, and 

local communities when financial institutions fail.

(d) Not later than one year after the date of enactment of this Act, the 

Commission shall submit a report containing the results of the study required by 

this section, together with comments and recommendations for legislation 

providing for a sound, reasonable, and primarily self-supporting credit program 

for farmers and ranchers as the Commission considers appropriate, to Congress.

(e) The Commission shall be comprised of volunteers and no Federal 

funds shall be expended by the Commission.
Type: Statute

Statute: CONSOLIDATED APPROPRIATION ACT, 2016

Title: Title VII Financial Services

Part: [Part]

Subtitle: Treatment of Affiliate Transactions

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/7/2017

Date Modified: 2/15/2018

CONSOLIDATED APPROPRIATION ACT, 2016

* * * * *

TITLE VII—FINANCIAL SERVICES

* * * * *

SEC. 705. TREATMENT OF AFFILIATE TRANSACTIONS.

(a) COMMODITY EXCHANGE ACT AMENDMENTS.—Section

2(h)(7)(D) of the Commodity Exchange Act (7 U.S.C. 2(h)(7)(D))

is amended—

(1) by redesignating clause (iii) as clause (v);

(2) by striking clauses (i) and (ii) and inserting the following:

‘‘(i) IN GENERAL.—An affiliate of a person that

qualifies for an exception under subparagraph (A)

(including affiliate entities predominantly engaged in

providing financing for the purchase of the merchandise

or manufactured goods of the person) may qualify

for the exception only if the affiliate—

‘‘(I) enters into the swap to hedge or mitigate

the commercial risk of the person or other affiliate

of the person that is not a financial entity, and

the commercial risk that the affiliate is hedging

or mitigating has been transferred to the affiliate;

‘‘(II) is directly and wholly-owned by another affiliate qualified 

for the exception under this subparagraph or an entity that is not a 

financial entity;

‘‘(III) is not indirectly majority-owned by a

financial entity;

‘‘(IV) is not ultimately owned by a parent company

that is a financial entity; and

‘‘(V) does not provide any services, financial

or otherwise, to any affiliate that is a nonbank

financial company supervised by the Board of Governors

(as defined under section 102 of the Financial

Stability Act of 2010).

‘‘(ii) LIMITATION ON QUALIFYING AFFILIATES.—The
exception in clause (i) shall not apply if the affiliate

is—

‘‘(I) a swap dealer;

‘‘(II) a security-based swap dealer;

‘‘(III) a major swap participant;

‘‘(IV) a major security-based swap participant;

‘‘(V) a commodity pool;

‘‘(VI) a bank holding company;

‘‘(VII) a private fund, as defined in section

202(a) of the Investment Advisers Act of 1940 (15

U.S.C. 80–b–2(a));

‘‘(VIII) an employee benefit plan or government

plan, as defined in paragraphs (3) and (32)

of section 3 of the Employee Retirement Income

Security Act of 1974 (29 U.S.C. 1002);

‘‘(IX) an insured depository institution;

‘‘(X) a farm credit system institution;

‘‘(XI) a credit union;

‘‘(XII) a nonbank financial company supervised

by the Board of Governors (as defined under section

102 of the Financial Stability Act of 2010);

or

‘‘(XIII) an entity engaged in the business of

insurance and subject to capital requirements

established by an insurance governmental

authority of a State, a territory of the United

States, the District of Columbia, a country other

than the United States, or a political subdivision

of a country other than the United States that

is engaged in the supervision of insurance companies

under insurance law.

‘‘(iii) LIMITATION ON AFFILIATES’ AFFILIATES.—

Unless the Commission determines, by order, rule, or

regulation, that it is in the public interest, the exception

in clause (i) shall not apply with respect to an

affiliate if the affiliate is itself affiliated with—

‘‘(I) a major security-based swap participant;

‘‘(II) a security-based swap dealer;

‘‘(III) a major swap participant; or

‘‘(IV) a swap dealer.

‘‘(iv) CONDITIONS ON TRANSACTIONS.—With respect

to an affiliate that qualifies for the exception in clause

(i)—

‘‘(I) the affiliate may not enter into any swap other than for the 

purpose of hedging or mitigating

commercial risk; and

‘‘(II) neither the affiliate nor any person affiliated

with the affiliate that is not a financial entity

may enter into a swap with or on behalf of any

affiliate that is a financial entity or otherwise

assume, net, combine, or consolidate the risk of
swaps entered into by any such financial entity,

except one that is an affiliate that qualifies for

the exception under clause (i).’’; and

(3) by adding at the end the following:

‘‘(vi) RISK MANAGEMENT PROGRAM.—Any swap

entered into by an affiliate that qualifies for the exception

in clause (i) shall be subject to a centralized risk

management program of the affiliate, which is reasonably

designed both to monitor and manage the risks

associated with the swap and to identify each of the

affiliates on whose behalf a swap was entered into.’’.

(b) SECURITIES EXCHANGE ACT OF 1934 AMENDMENT.—Section

3C(g)(4) of the Securities Exchange Act of 1934 (15 U.S.C. 78c–

3(g)(4)) is amended—

(1) by redesignating subparagraph (C) as subparagraph (E);

(2) by striking subparagraphs (A) and (B) and inserting

the following:

‘‘(A) IN GENERAL.—An affiliate of a person that qualifies

for an exception under this subsection (including affiliate

entities predominantly engaged in providing financing for

the purchase of the merchandise or manufactured goods

of the person) may qualify for the exception only if the

affiliate—

‘‘(i) enters into the security-based swap to hedge

or mitigate the commercial risk of the person or other

affiliate of the person that is not a financial entity,

and the commercial risk that the affiliate is hedging

or mitigating has been transferred to the affiliate;

‘‘(ii) is directly and wholly-owned by another affiliate

qualified for the exception under this paragraph

or an entity that is not a financial entity;

‘‘(iii) is not indirectly majority-owned by a financial

entity;

‘‘(iv) is not ultimately owned by a parent company

that is a financial entity; and

‘‘(v) does not provide any services, financial or

otherwise, to any affiliate that is a nonbank financial

company supervised by the Board of Governors (as

defined under section 102 of the Financial Stability

Act of 2010).

‘‘(B) LIMITATION ON QUALIFYING AFFILIATES.—The

exception in subparagraph (A) shall not apply if the affiliate

is—

‘‘(i) a swap dealer;

‘‘(ii) a security-based swap dealer;

‘‘(iii) a major swap participant;

‘‘(iv) a major security-based swap participant;

‘‘(v) a commodity pool;

‘‘(vi) a bank holding company;

‘‘(vii) a private fund, as defined in section 202(a)

of the Investment Advisers Act of 1940 (15 U.S.C.
80–b–2(a));

‘‘(viii) an employee benefit plan or government

plan, as defined in paragraphs (3) and (32) of section

3 of the Employee Retirement Income Security Act

of 1974 (29 U.S.C. 1002);

‘‘(ix) an insured depository institution;

‘‘(x) a farm credit system institution;

‘‘(xi) a credit union;

‘‘(xii) a nonbank financial company supervised by

the Board of Governors (as defined under section 102

of the Financial Stability Act of 2010); or

‘‘(xiii) an entity engaged in the business of insurance

and subject to capital requirements established

by an insurance governmental authority of a State,

a territory of the United States, the District of

Columbia, a country other than the United States,

or a political subdivision of a country other than the

United States that is engaged in the supervision of

insurance companies under insurance law.

‘‘(C) LIMITATION ON AFFILIATES’ AFFILIATES.—Unless

the Commission determines, by order, rule, or regulation,

that it is in the public interest, the exception in subparagraph

(A) shall not apply with respect to an affiliate if

such affiliate is itself affiliated with—

‘‘(i) a major security-based swap participant;

‘‘(ii) a security-based swap dealer;

‘‘(iii) a major swap participant; or

‘‘(iv) a swap dealer.

‘‘(D) CONDITIONS ON TRANSACTIONS.—With respect to

an affiliate that qualifies for the exception in subparagraph

(A)—

‘‘(i) such affiliate may not enter into any security based

swap other than for the purpose of hedging

or mitigating commercial risk; and

‘‘(ii) neither such affiliate nor any person affiliated

with such affiliate that is not a financial entity may

enter into a security-based swap with or on behalf

of any affiliate that is a financial entity or otherwise

assume, net, combine, or consolidate the risk of securitybased swaps entered into by any such financial

entity, except one that is an affiliate that qualifies

for the exception under subparagraph (A).’’; and

(3) by adding at the end the following:

‘‘(F) RISK MANAGEMENT PROGRAM.—Any security-based

swap entered into by an affiliate that qualifies for the

exception in subparagraph (A) shall be subject to a centralized

risk management program of the affiliate, which is

reasonably designed both to monitor and manage the risks

associated with the security-based swap and to identify

each of the affiliates on whose behalf a security-based

swap was entered into.’’

Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2015

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C.

Date Created: 8/11/2017

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 2015

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $54,000,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships. Provided further, That the agency may exceed this 

limitation by up to 10 percent with notification to the Committees on 

Appropriations of both Houses of Congress.

* * * * *
Type: Statute

Statute: CONSOLIDATED APPROPRIATIONS ACT, 2014

Title: Title IV Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Limitation on Administrative Expenses

Chapter Name: [Chapter Name]

U.S. Code Citation [U.S. Code Citation]

Date Created: 8/7/2017

Date Modified: 2/15/2018

CONSOLIDATED APPROPRIATIONS ACT, 2014

* * * * *

TITLE IV – RELATED AGENCIES AND FOOD AND DRUG ADMINISTRATION

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $62,600,000 (from assessments collected from

farm credit institutions, including the Federal Agricultural Mortgage

Corporation) shall be obligated during the current fiscal year

for administrative expenses as authorized under 12 U.S.C. 2249:

Provided, That this limitation shall not apply to expenses associated

with receiverships: Provided further, That the agency may exceed

this limitation by up to 10 percent with notification to the Committees

on Appropriations of both Houses of Congress: Provided further,

That no funds available to the Farm Credit Administration shall

be used to implement or enforce those portions of the final regulation

published in the Federal Register on October 3, 2012, (77

Fed. Reg. 60, 582–602), establishing a requirement that Farm Credit

System institutions hold an advisory vote on officer compensation.
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2013

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C.

Date Created: 8/11/2017

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 2013

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $59,780,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2012

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C.

Date Created: 8/11/2017

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 2012

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $61,000,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2011

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C.

Date Created: 8/11/2017

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 2011

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $59,400,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2010

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 2010

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $54,500,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: OMNIBUS APPROPRIATIONS ACT, 2009

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agency

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

OMNIBUS APPROPRIATIONS ACT, 2009

* * * * *

TITLE VI—RELATED AGENCY AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCY

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $49,000,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: CONSOLIDATED APPROPRIATIONS ACT, 2008

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

CONSOLIDATED APPROPRIATIONS ACT, 2008

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $46,000,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: REVISED CONTINUING APPROPRIATIONS RESOLUTION, 2007

Title: Division B – Continuing Appropriations Resolution, 2007

Part: Title I – Full-Year Continuing Appropriations

Subtitle: [Subtitle]

Chapter Name: [Chapter Name]

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

REVISED CONTINUING APPROPRIATIONS RESOLUTION, 2007

* * * * *

DIVISION B--CONTINUING APPROPRIATIONS RESOLUTION, 2007

The following sums are hereby appropriated, out of any money in the 

Treasury not otherwise appropriated, and out of applicable corporate or other 

revenues, receipts, and funds, for the several departments, agencies, corporations, 

and other organization units of Government for fiscal year 2007, and for other 

purposes, namely:

TITLE I--FULL-YEAR CONTINUING APPROPRIATIONS

SEC. 101. (a) Such amounts as may be necessary, at the level specified in 

subsection (c) and under the authority and conditions provided in the applicable 

appropriations Act for fiscal year 2006, for projects or activities (including the 

costs of direct loans and loan guarantees) that are not otherwise provided for and 

for which appropriations, funds, or other authority were made available in the 

following appropriations Acts:

(b) The Agriculture, Rural Development, Food and Drug Administration, 

and Related Agencies Appropriations Act, 2006.

* * * * *

SEC. 102. Appropriations made by section 101 shall be available to the 

extent and in the manner that would be provided by the pertinent appropriations 

Act.

* * * * *

SEC. 104. Except as otherwise expressly provided in this division, the 

requirements, authorities, conditions, limitations, and other provisions of the 

appropriations Acts referred to in section 101(a) shall continue in effect through 

the date specified in section 106.

* * * * *
SEC. 106. Unless otherwise provided for in this division or in the 

applicable appropriations Act, appropriations and funds made available and 

authority granted pursuant to this division shall be available through September 

30, 2007.

* * * * *

SEC. 111. (a)(1) In addition to any amounts otherwise provided by this 

division, such sums as may be necessary are hereby appropriated to fund, for 

covered employees under a statutory pay system (as defined by section 5302 of 

title 5, United States Code), 50 percent of any increase in rates of pay which 

became effective under sections 5303 through 5304a of such title 5 in January 

2007.

(2)(A) In addition to any amounts otherwise provided by this 

division, such sums as may be necessary are hereby appropriated to 

provide the amount which would be necessary to fund, for covered 

employees not described in paragraph (1), 50 percent of the cost of 

an increase in rates of pay, calculated as if such employees were 

covered by paragraph (1) and as if such increase had been made on

the first day of the first pay period beginning in January 2007 based 

on the rates that were in effect for such employees as of the day 

before such first day.

(B) Subparagraph (A) is intended only to provide funding for 

pay increases for covered employees not described in paragraph (1). 

Nothing in subparagraph (A) shall be considered to modify, 

supersede, or render inapplicable the provisions of law in accordance 

with which the size or timing of any pay increase actually provided 

with respect to such employees is determined.

(b) Appropriations under this section shall include funding for pay periods 

beginning on or after January 1, 2007, and the pay costs covered by this 

appropriation shall include 50 percent of the increases in agency contributions for 

employee benefits resulting from the pay increases described in subsection (a).

(c) For purposes of this section, the term "covered employees" means 

employees whose pay is funded in whole or in part (including on a reimbursable 

basis) by any account for which funds are provided by this division (other than 

by chapters 2 and 11 of title II of this division) after October 4, 2006.

* * * * *

SEC. 114. Within 15 days after the enactment of this section, the Director 

of the Office of Management and Budget shall submit to the Committees on 

Appropriations of the House of Representatives and the Senate--

(1) a report specifying, by account, the amounts provided by this 

division for executive branch departments and agencies; and

(2) a report specifying, by account, the amounts provided by section 

111 for executive branch departments and agencies.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2006

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS

ACT, 2006

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $44,250,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: CONSOLIDATED APPROPRIATIONS ACT, 2005

Title: Division A – Agriculture, Rural Development, Food and Drug 

Administration, and Related Agencies Programs Appropriations, 2005

Part: Title VI – Related Agencies and Food and Drug Administration

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

CONSOLIDATED APPROPRIATIONS ACT, 2005

* * * * *

DIVISION A--AGRICULTURE, RURAL DEVELOPMENT, FOOD AND 

DRUG ADMINISTRATION, AND RELATED AGENCIES PROGRAMS 

APPROPRIATIONS, 2005

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $42,350,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: CONSOLIDATED APPROPRIATIONS ACT, 2004

Title: Division A – Agriculture, Rural Development, Food and Drug 

Administration, and Related Agencies Programs Appropriations, 2004

Part: Title VI – Related Agencies and Food and Drug Administration

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

CONSOLIDATED APPROPRIATIONS ACT, 2004

* * * * *

DIVISION A--AGRICULTURE, RURAL DEVELOPMENT, FOOD AND 

DRUG ADMINISTRATION, AND RELATED AGENCIES PROGRAMS 

APPROPRIATIONS, 2004

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $40,900,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: CONSOLIDATED APPROPRIATIONS RESOLUTION, 2003

Title: Division A – Agriculture, Rural Development, Food and Drug 

Administration, and Related Agencies Programs Appropriations, 2003

Part: Title VI – Related Agencies and Food and Drug Administration

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

CONSOLIDATED APPROPRIATIONS RESOLUTION, 2003

* * * * *

DIVISION A--AGRICULTURE, RURAL DEVELOPMENT, FOOD AND 

DRUG ADMINISTRATION, AND RELATED AGENCIES PROGRAMS 

APPROPRIATIONS, 2003

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $38,400,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249: Provided,That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2002

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C.

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 2002

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $36,700,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided, That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2001

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS

ACT, 2001

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $36,800,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided, That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 2000

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS

ACT, 2000

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $35,800,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided, That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1999

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C.

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 1999

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $35,800,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided, That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1998

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C.

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 1998

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $34,423,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided, That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1997

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS

ACT, 1997

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $37,478,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249; Provided, That this limitation shall not apply to expenses 

associated with receiverships.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1996

Title: Title VI Related Agencies and Food and Drug Administration

Part: Administrative Provision

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation [U.S. Code Citation]

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 1996

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

ADMINISTRATIVE PROVISION

SEC. 601. (a) For purposes of the administration of chapter 89 of title 5, 

United States Code, any period of enrollment under a health benefits plan 

administered by the Farm Credit Administration prior to the effective date of this 

Act shall be deemed to be a period of enrollment in a health benefits plan under 

chapter 89 of such title.

(b)(1) An individual who, on September 30, 1995, is covered by a health 

benefits plan administered by the Farm Credit Administration may enroll in an 

approved health benefits plan described under section 8903 or 8903a of title 5, 

United States Code—

(A) either as an individual or for self and family, if such 

individual is an employee, annuitant, or former spouse as defined 

under section 8901 of such title; and

(B) for coverage effective on and after September 30, 1995.

(2) An individual who, on September 30, 1995, is entitled to 

continued coverage under a health benefits plan administered by the Farm 

Credit Administration—

(A) shall be deemed to be entitled to continued coverage 

under section 8905a of title 5, United States Code, for the same 

period that would have been permitted under the plan administered 

by the Farm Credit Administration; and
(B) may enroll in an approved health benefits plan described 

under sections 8903 or 8903a of such title in accordance with section 

8905A of such title for coverage effective on and after September 30, 

1995.

(3) An individual who, on September 30, 1995, is covered as an 

unmarried dependent child under a health benefits plan administered by the 

Farm Credit Administration and who is not a member of family as defined 

under section 8901(5) of title 5, United States Code—

(A) shall be deemed to be entitled to continued coverage 

under section 8905a of such title as though the individual had, on 

September 30, 1995, ceased to meet the requirements for being 

considered an unmarried dependent child under chapter 89 of such 

title; and

(B) may enroll in an approved health benefits plan described 

under section 8903 or 8903a of such title in accordance with section 

8905a for continued coverage on and after September 30, 1995.

(c) The Farm Credit Administration shall transfer to the Federal 

Employees Health Benefits Fund established under section 8909 of title 5, United 

States Code, amounts determined by the Director of the Office of Personnel 

Management, after consultation with the Farm Credit Administration, to be 

necessary to reimburse the Fund for the cost of providing benefits under this 

section not otherwise paid for by the individuals covered by this section. The 

amount so transferred shall be held in the Fund and used by the Office in addition 

to the amounts available under section 8906(g)(1) of such title.

(d) The Office of Personnel Management—

(1) shall administer the provisions of this section to provide for—

(A) a period of notice and open enrollment for individuals 

affected by this section; and

(B) no lapse of health coverage for individuals who enroll in 

a health benefits plan under chapter 89 of title 5, United States Code, 

in accordance with this section; and

(2) may prescribe regulations to implement this section.
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1995

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS

ACT, 1995

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $40,420,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1994

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation 12 U.S.C. 

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS

ACT, 1994

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $40,426,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1993

Title: Title VI Related Agencies and Food and Drug Administration

Part: RURAL DEVELOPMENT, AGRICULTURE, AND RELATED AGENCIES 

APPROPRIATIONS ACT, 1991

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation [U.S. Code Citation]

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 1993

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON ADMINISTRATIVE EXPENSES

Not to exceed $39,908,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

obligated during the current fiscal year for administrative expenses as authorized 

under 12 U.S.C. 2249, including not to exceed the following amounts: official 

reception and representation expenses, $1,500; Office of Secondary Market 

Oversight, $300,000; Office of the General Counsel, $2,000,000; and Office of 

Congressional and Public Affairs, $500,000.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1992

Title: Title VI Related Agencies and Food and Drug Administration

Part: [Part]

Subtitle: Independent Agencies

Chapter Name: Farm Credit Administration

U.S. Code Citation [U.S. Code Citation]

Date Created: 12/18/2012

Date Modified: 2/15/2018

AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 

ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS 

ACT, 1992

* * * * *

TITLE VI—RELATED AGENCIES AND FOOD AND DRUG 

ADMINISTRATION

* * * * *

INDEPENDENT AGENCIES

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON REVOLVING FUND FOR ADMINISTRATIVE 

EXPENSES

Not to exceed $40,290,000 (from assessments collected from farm credit 

institutions and from the Federal Agricultural Mortgage Corporation) shall be 

available for administrative expenses as authorized under 12 U.S.C. 2249, of 

which not to exceed $1,500 shall be available for official reception and 

representation expenses.

* * * * *
Type: Statute

Statute: AGRICULTURE APPROPRIATIONS ACT, 1991

Title: Title V Related Agencies

Part: [Part]

Subtitle: Department of the Treasury

Chapter Name: Farm Credit Administration

U.S. Code Citation [U.S. Code Citation]

Date Created: 12/18/2012

Date Modified: 2/15/2018

RURAL DEVELOPMENT, AGRICULTURE, AND RELATED 

AGENCIES APPROPRIATIONS ACT, 1991

* * * * *

TITLE V—RELATED AGENCIES

* * * * *

DEPARTMENT OF THE TREASURY

* * * * *

FARM CREDIT ADMINISTRATION

LIMITATION ON REVOLVING FUND FOR ADMINISTRATIVE 

EXPENSES

Not to exceed $40,290,000 (from assessments collected from farm credit 

institutions) and not the exceed $608,000 (from assessments collected from the 

Federal Agricultural Mortgage Corporation); in all, $40,898,000, shall be 

available for administrative expenses as authorized under 12 U.S.C. 2249, of 

which not to exceed $1,500 shall be available for official reception and 

representation expenses.

* * * * *