03-9711. Market Access Agreement

AGENCY:

Farm Credit Administration (FCA).

ACTION:

Notice of approval of the draft amended and restated market access agreement.

SUMMARY:

The Farm Credit Administration (FCA) announces it has approved the Draft Amended and Restated Market Access Agreement (Draft Restated MAA) proposed to be entered into by all of the banks of the Farm Credit System (System) and the Federal Farm Credit Banks Funding Corporation (Funding Corporation). The Draft Restated MAA sets forth the rights and responsibilities of each of the parties when the condition of a bank falls below pre-established financial performance thresholds.

FOR FURTHER INFORMATION CONTACT:

 

Samuel R. Coleman, CFA, Senior Policy Analyst, Office of Policy and Analysis, Farm Credit Administration, McLean, VA 22102-5090, [phone], TTY [phone],

  or

James M. Morris, Senior Counsel, Office of General Counsel, Farm Credit Administration, McLean, VA 22102-5090, [phone], TTY [phone].

SUPPLEMENTARY INFORMATION:

The FCA published the Draft Restated MAA in the Federal Register on January 15, 2003 (68 FR 2037) with a request for public comment. No public comments were received on the Draft Restated MAA.

The Draft Restated MAA is an update to the original Market Access Agreement (MAA) approved by the FCA on August 17, 1994, and published in the Federal Register on August 23, 1994 (59 FR 43344). The Draft Restated MAA provides that it will go into effect after certain conditions precedent have been satisfied, including FCA's approval of, and the Farm Credit System Insurance Corporation's (FCSIC) expression of its support for, the Draft Restated MAA. The FCA announces it has approved the Draft Restated MAA.

System banks and the Funding Corporation entered into the original MAA on September 1, 1994, to help control the risk by outlining each party's respective rights and responsibilities in the event the condition of a System bank fell below certain financial performance thresholds. As part of the original MAA, System banks and the Funding Corporation agreed to periodic reviews of the terms of the MAA to consider whether any amendments were appropriate. The Draft Restated MAA updates the original MAA and provides for more stringent financial performance thresholds on each System bank. Both the original MAA and Draft Restated MAA establish financial performance thresholds at which conditions are placed on the activities of a bank or a bank's access to participation in Systemwide and consolidated obligations is restricted.

FCA published the Draft Restated MAA in the Federal Register on January 15, 2003, with a request for public comments by February 14, 2003. No comments were received. Having given the public notice and the opportunity to comment, the FCA Board hereby approves the Draft Restated MAA pursuant to sections 4.2(c), 4.2(d) and 4.9(b)(2) of the Farm Credit Act of 1971, as amended. The FCA's approval of the Draft Restated MAA is conditioned on the board of directors of each bank and the Funding Corporation approving the Draft Restated MAA. Neither the Draft Restated MAA, when it becomes effective, nor FCA approval of it shall in any way restrict or qualify the authority of the FCA or the FCSIC to exercise any of the powers, rights, or duties granted by law to the FCA or the FCSIC. Finally, the FCA retains the right to modify or revoke its approval of the Draft Restated MAA at any time.

Dated: April 15, 2003.

Jeanette C. Brinkley,

Secretary, Farm Credit Administration Board.