12 U.S. Code § 2277a–10 - Powers of Corporation with respect to troubled insured System banks
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.
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.
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.
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.
Any assistance provided under this subsection may be in subordination to the rights of owners of obligations and other creditors.
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.
The Corporation shall not exercise any authority under this section during the 5-year period prior to January 1, 1993.
1996—Subsec. (a)(1). Pub. L. 104–105, § 217(b)(1), substituted “Stand-alone assistance” for “In general” in par. heading.
Subsec. (a)(2). Pub. L. 104–105, § 217(b)(2)(A), substituted “Facilitation of mergers or consolidation” for “Enumerated powers” in par. heading.
Subsec. (a)(2)(A). Pub. L. 104–105, § 217(b)(2)(B), substituted “In general” for “Facilitation of mergers or consolidation” in subpar. heading.
Subsec. (a)(3)(A). Pub. L. 104–105, § 217(a)(2), added subpar. (A) and struck out heading and text of former subpar. (A). Text read as follows: “Assistance shall not be provided to an insured System bank under this subsection if the amount of such assistance exceeds an amount determined by the Corporation to be the cost of liquidating the bank (including paying the insured obligations issued on behalf of the bank). This subparagraph shall not apply to the provision of assistance to a bank if the Corporation determines that the continued operation of the bank is essential to provide adequate agricultural credit services in the area of operations of the bank.”
Subsec. (a)(3)(B) to (F). Pub. L. 104–105, § 217(a), added subpars. (B) to (E) and redesignated former subpar. (B) as (F).
1990—Subsec. (f). Pub. L. 101–624 substituted “prior to January 1, 1993” for “beginning on the date of the enactment of this part”.
Amendment by Pub. L. 101–220 effective for insurance premiums due to the Farm Credit System Insurance Corporation under this chapter on or after Jan. 1, 1990, based on the loan volume of each bank for each calendar year beginning with calendar year 1989, and effective for the calculation of the initial premium payment required under section 2277a–5(c) of this title, see section 6(c) of Pub. L. 101–220, set out as a note under section 2020 of this title.
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