Home > 104th Congressional Public Laws > Pub.L. 104-106 To authorize appropriations for fiscal year 1996 for military activities ...Pub.L. 104-106 To authorize appropriations for fiscal year 1996 for military activities ...
referred to in subsection (a); and
``(B) contain''; and
(B) in the second sentence, by striking ``The
regulations shall'' and inserting the following:
``(2) Specificity.--The regulations referred to in paragraph
(1) shall''.
SEC. 114. MINIMUM CAPITAL LEVEL.
Section 8.33 of the Farm Credit Act of 1971 (12 U.S.C. 2279bb-2) is
amended to read as follows:
``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
[[Page 110 STAT. 167]]
``(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).''.
SEC. 115. CRITICAL CAPITAL LEVEL.
Section 8.34 of the Farm Credit Act of 1971 (12 U.S.C. 2279bb-3) is
amended to read as follows:
``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
[[Page 110 STAT. 168]]
percent of the total minimum capital amount determined under section
8.33.''.
SEC. 116. ENFORCEMENT LEVELS.
Section 8.35(e) of the Farm Credit Act of 1971 (12 U.S.C. 2279bb-
4(e)) is amended by striking ``during the 30-month period beginning on
the date of the enactment of this section,'' and inserting ``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,''.
SEC. 117. RECAPITALIZATION OF THE CORPORATION.
Title VIII of the Farm Credit Act of 1971 (12 U.S.C. 2279aa et seq.)
is amended by adding at the end the following:
``SEC. 8.38. <<NOTE: 12 USC 2279bb-7.>> 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
on-balance sheet assets of the Corporation plus the outstanding
principal of the off-balance 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.''.
SEC. 118. LIQUIDATION OF THE FEDERAL AGRICULTURAL MORTGAGE CORPORATION.
Title VIII of the Farm Credit Act of 1971 (12 U.S.C. 2279aa et seq.)
(as amended by section 117) is amended by adding at the end the
following:
``Subtitle C--Receivership, Conservator-ship, and Liquidation of the
Federal
Agricultural Mortgage Corporation
``SEC. 8.41. <<NOTE: 12 USC 2279cc.>> CONSERVATORSHIP; LIQUIDATION;
RECEIVERSHIP.
``(a) Voluntary Liquidation.--The Corporation may voluntarily
liquidate only with the consent of, and in accordance with
[[Page 110 STAT. 169]]
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
[[Page 110 STAT. 170]]
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) <<NOTE: Claims.>> 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
[[Page 110 STAT. 171]]
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.
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