The Farm Credit Administration wants some advice on updating regulations governing Farm Credit System loans to banks, thrifts, and other financial institutions.
The Farm Credit System extends short- and intermediate-term credit for agricultural and related purposes. The program peaked in the early 1980s when 300 banks, thrifts, and credit unions borrowed almost $1 billion. Today, the system has just $231 million loaned to 22 institutions.
In an advanced notice of proposed rulemaking published in the May 17 Federal Register, the FCA's board questions a number of definitions that determine which institutions qualify as borrowers. For example, the law states that to qualify, a borrower must be significantly involved in agriculture. The agency deems an institution to be significantly involved in farming if ag loans make up at least 15% of its loan portfolio.
"We're asking whether our regulations are more restrictive than the statute requires," explained FCA spokeswoman Christine Quinn.
Comments are due July 16.