12 U.S.C. § 2091: Organizations; articles…

Summary

Federal land bank associations must keep a federal charter and act as a federal government entity. A group of 10 or more people who want a loan from a Farm Credit Bank can form one. The group's papers must describe the area it will serve and be sent to the Farm Credit Bank with a promise to buy association stock under the bank’s rules. Stock can be paid by turning in bank stock for cancellation and getting the same amount of association stock. Each member must sign a statement saying they are eligible for a loan, that the land is not already served by another association, and that they will be a stockholder. The Farm Credit Administration gets the articles with the bank’s recommendation and a note about any overlapping territory. The Administration can deny a charter for good cause. If it approves and issues the charter, the association becomes a federally chartered entity on that date. The Administration also sets rules about organizing the association, the initial stock amount, its service territory, and any charter changes.

Title 12, §2091

Banks and Banking, Source: USLM XML via OLRC

(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 2015(a) of this title, 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.

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 2091, Pub. L. 92–181, title II, § 2.10, Dec. 10, 1971, 85 Stat. 597; Pub. L. 96–592, title II, § 207, Dec. 24, 1980, 94 Stat. 3442; Pub. L. 99–205, title II, § 205(e)(10), Dec. 23, 1985, 99 Stat. 1704; Pub. L. 100–233, title VIII, §§ 802(l), 805(g), Jan. 6, 1988, 101 Stat. 1711, 1715, related to organization and charters of production credit associations, prior to the general amendment of this subchapter by Pub. L. 100–233, § 401.

Amendments

1988—Subsec. (b)(1). Pub. L. 100–399, § 401(s)(1), inserted “under section 2015(a) of this title” after “a Farm Credit Bank”. Subsec. (b)(2)(D)(i). Pub. L. 100–399, § 401(s)(2), amended cl. (i) generally. Prior to amendment, cl. (i) read as follows: “the individual’s eligibility for, and request or need of the individual of a Farm Credit Bank loan;”. Subsec. (c). Pub. L. 100–399, § 401(t), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: “The Farm Credit Administration shall have power, in the terms of the charter, under

Rules and Regulations

prescribed by the Farm Credit Administration or by approving the bylaws of the association, to provide for the— “(1) organization of the association; “(2) the initial amount of stock of such association; “(3) the territory within which the operations of the association may be carried on; and “(4) to direct at any time changes in the charter of such association as the Farm Credit Administration finds necessary in accomplishing the purposes of this chapter.”

Statutory Notes and Related Subsidiaries

Effective Date

of 1988 AmendmentAmendment by Pub. L. 100–399 effective immediately after amendment made by section 401 of Pub. L. 100–233, which was effective 6 months after Jan. 6, 1988, see section 1001(b) of Pub. L. 100–399, set out as a note under section 2002 of this title.

Effective Date

Pub. L. 100–233, title IV, § 401, Jan. 6, 1988, 101 Stat. 1622, provided that this section is effective 6 months after Jan. 6, 1988.

§2091 Organizations; Articles; Charters; Powers of the Farm Credit Administration

Summary

Title 12, §2091

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

Amendments

Rules and Regulations

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Citations & Metadata