[Federal Register Volume 59, Number 119 (Wednesday, June 22, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-15136]
[[Page Unknown]]
[Federal Register: June 22, 1994]
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FARM CREDIT ADMINISTRATION
[BM-17-FEB-94-02]
Policy Statement on Regulatory Philosophy
AGENCY: Farm Credit Administration.
ACTION: Policy statement.
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SUMMARY: The Farm Credit Administration (FCA) Board adopted a ``Policy
Statement on Regulatory Philosophy'' [BM-17-FEB-94-02; FCA-PS-59] on
February 17, 1994. This policy statement is in final form; however,
pursuant to the ``Policy Statement on Rules for Transaction of Business
and Operational Responsibilities of the Farm Credit Administration
Board'' [NV-94-05 (07-FEB-94); FCA-PS-58], Article VII, Section 2(b),
this Policy Statement should be reviewed by the FCA Board no later than
February 17, 1999.
EFFECTIVE DATE: February 17, 1994.
FOR FURTHER INFORMATION CONTACT: Curtis M. Anderson, Secretary to the
Farm Credit Administration Board, Farm Credit Administration, McLean,
Virginia 22102-5090, (703) 883-4000, TDD (703) 883-4444.
SUPPLEMENTARY INFORMATION: The text of the Board's policy statement
concerning regulatory philosophy is set forth below in its entirety:
Policy Statement on Regulatory Philosophy; BM-17-FEB-94-02; FCA-PS-
59
Effective Date: Upon adoption.
Effect on Previous Action: None.
Source of Authority: Farm Credit Act of 1971, as amended; 12 U.S.C.
2001 et seq.
THE FCA BOARD HEREBY ADOPTS THE FOLLOWING POLICY STATEMENT:
The FCA shall develop regulations consistent with its authorities
under the Farm Credit Act of 1971 (Act), as amended, and other relevant
statutes. It is the FCA Board's philosophy to promulgate regulations
that are necessary to implement the law and to promote the safety and
soundness of the Farm Credit System (System). In general, the Board's
regulatory objective will be to:
Protect the public, the investors, and the customer/shareholders
of the System in an effort to create an environment whereby
customer/shareholders and investors can take advantage of the
System's strength and rely on its future viability with confidence.
The FCA Board believes that safe and sound operations of System
institutions will promote: (a) Investor confidence in System debt
securities, which works to ensure adequate funds at reasonable rates
for lending to customer/shareholders; and, (b) customer/shareholder
confidence in each cooperatively owned System institution, which works
to ensure customers and capital.
To effectively achieve its objective, the FCA will do the
following:
1. The FCA will promulgate regulations only as required by law, as
necessary to interpret the law, or as necessary to promote the safe and
sound operation of System institutions.
2. The FCA will work to eliminate outdated regulations and ensure
that its regulations implement the purposes of the law without
unnecessary burden or cost. The FCA Board recognizes that some costs
and benefits are difficult to quantify and that some are qualitative,
but essential to consider. When there is a significant cost impact, the
FCA will consider the risk or problem, as well as the costs associated
with a regulatory solution, from the perspective of the customer/
shareholder, the System institution, the investor, and the regulator,
including when appropriate a numerically-based cost analysis. In
choosing among alternatives, the FCA will adopt its regulatory approach
based upon a reasoned determination that the benefits of the intended
regulations justify their cost.
3. The FCA will strive to ensure that each regulation has a well-
defined objective. Regulations will address specific identified risks
or problems. The Board will consider these risks from the perspective
of the customer/shareholder, the System institution, the investor, and
the regulator. Preambles to regulations will explain the FCA Board's
rationale for the regulatory solution adopted. Consistent with its
statutory authority, the FCA will establish a regulatory environment
that grants System institutions the business flexibility to offer a
full range of high quality, low cost credit and other services to
customer/shareholders.
4. The FCA's regulations shall, to the extent feasible, specify
performance criteria and objectives rather than operational methods for
achieving its purposes. The FCA recognizes that it does not manage the
day-to-day activities of System institutions. Operational constraints
that are imposed by regulations should be based on specific statutory
requirements or the achievement of regulatory objectives.
5. In setting regulatory priorities, the FCA, to the extent it has
discretion, will give high priority to issues that pose the greatest
risk within the Farm Credit System.
6. The FCA will carefully consider policy positions of the other
financial regulators to determine whether or not consistency
facilitates the objectives of the Act. The FCA Board recognizes that
differences between the System and non-agricultural lenders will at
times warrant different approaches.
7. The FCA will draft its regulations and policy statements to be
clear and easy to understand, with the goal of minimizing the potential
for ambiguity, uncertainty, and resultant litigation.
8. The FCA will utilize appropriate innovative approaches to
seeking the public's perspective regarding regulatory proposals.
The FCA Board will take these principles into consideration as its
considers the need for and the content of new regulatory initiatives
and as it reviews existing regulations to determine their continuing
need and effectiveness. The FCA Board is mindful that most regulatory
activities will involve competing considerations and is committed to
considering and weighing those competing considerations and arriving at
thoughtful regulatory judgments.
Adopted this 17th day of February, 1994, by order of the Board.
Dated: June 16, 1994.
Curtis M. Anderson,
Secretary, Farm Credit Administration Board.
[FR Doc. 94-15136 Filed 6-21-94; 8:45 am]
BILLING CODE 6705-01-P