§2279d — Title 12 Banks and Banking | U.S. Code

§2279d Termination of System institution status

Title 12 › Chapter CHAPTER 23— - FARM CREDIT SYSTEM › Subchapter SUBCHAPTER VII— - RESTRUCTURING OF SYSTEM INSTITUTIONS › Part Part B— - Mergers, Transfers of Assets, and Powers of Associations Within a District › Subpart subpart 4— - termination and dissolution of institutions › § 2279d

Last updated Apr 6, 2026|Official source

Summary

A Farm Credit System institution can stop being a System institution if it meets several conditions. It must give the Farm Credit Administration Board written notice at least 90 days before the planned date, get the Board’s approval and any needed federal or state approval to become a bank, savings and loan, or other financial firm, pay to the Farm Credit Insurance Fund any capital above 6 percent of assets, pay or secure its debts, get a majority stockholder vote at a proper meeting held before the notice, and follow any other rules the Board sets. When the status ends, the Board will cancel the institution’s charter and it will no longer be treated as a U.S. government agency under this law.

Title 12, §2279d

Banks and Banking — Source: USLM XML via OLRC

(a)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 to the Farm Credit Insurance Fund 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)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 chapter.

Notes & Related Subsidiaries

Editorial Notes

Amendments

2018—Subsec. (a)(4). Pub. L. 115–334 added par. (4) and struck out former par. (4) which read as follows: “the institution pays to the Farm Credit Assistance Fund, as created under section 2278b–5 of this title, 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;”.