[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2130 Reported in House (RH)]

                                                 Union Calendar No. 233

104th CONGRESS

  2d Session

                               H. R. 2130

                      [Report No. 104-446, Part I]

_______________________________________________________________________

                                 A BILL

  To amend the Farm Credit Act of 1971 to improve the efficiency and 
  operation of the Federal Agricultural Mortgage Corporation in order 
  better to ensure that farmers, ranchers, and rural home owners will 
 have access to a stable and competitive supply of mortgage credit now 
                           and in the future.

_______________________________________________________________________

                             March 15, 1996

 Committee on Banking and Financial Services discharged; committed to 
the Committee of the Whole House on the State of the Union, and ordered 
                             to be printed
                                                 Union Calendar No. 233
104th CONGRESS
  2d Session
                                H. R. 2130

                      [Report No. 104-446, Part I]

  To amend the Farm Credit Act of 1971 to improve the efficiency and 
  operation of the Federal Agricultural Mortgage Corporation in order 
  better to ensure that farmers, ranchers, and rural home owners will 
 have access to a stable and competitive supply of mortgage credit now 
                           and in the future.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 27, 1995

 Mr. Emerson (for himself, Mr. Barrett of Nebraska, and Mr. Bereuter) 
 introduced the following bill; which was referred to the Committee on 
                              Agriculture

                            January 4, 1996

 Reported with an amendment, referred to the Committee on Banking and 
 Financial Services for a period ending not later than March 15, 1996 
for consideration of such provisions of the bill and amendment as fall 
within the jurisdiction of that committee pursuant to clause 1(c), rule 
                                   X
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

                             March 15, 1996

 Additional sponsors: Mr. Lucas of Oklahoma, Mr. Dooley of California, 
                    and Mr. Johnson of South Dakota

                             March 15, 1996

 Committee on Banking and Financial Services discharged; committed to 
the Committee of the Whole House on the State of the Union, and ordered 
                             to be printed
 [For text of introduced bill, see copy of bill as introduced on July 
                               27, 1995]

_______________________________________________________________________

                                 A BILL


 
  To amend the Farm Credit Act of 1971 to improve the efficiency and 
  operation of the Federal Agricultural Mortgage Corporation in order 
  better to ensure that farmers, ranchers, and rural home owners will 
 have access to a stable and competitive supply of mortgage credit now 
                           and in the future.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Farmer Mac Reform Act of 1995''.

SEC. 2. REFERENCES TO THE FARM CREDIT ACT OF 1971.

    Except as otherwise expressly provided, wherever in this Act an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of the Farm Credit Act of 1971 
(12 U.S.C. 2001 et seq.).

SEC. 3. DEFINITION OF REAL ESTATE.

    Section 8.0(1)(B)(ii) (12 U.S.C. 2279aa(1)(B)(ii)) is amended by 
striking ``with a purchase price'' and inserting ``, excluding the land 
to which the dwelling is affixed, with a value''.

SEC. 4. DEFINITION OF CERTIFIED FACILITY.

    Section 8.0(3) (12 U.S.C. 2279aa(3)) is amended--
            (1) in subparagraph (A), by striking ``a secondary 
        marketing agricultural loan'' and inserting ``an agricultural 
        mortgage marketing''; and
            (2) in subparagraph (B), by striking ``, but only'' and all 
        that follows through ``(9)(B)''.

SEC. 5. DUTIES OF FEDERAL AGRICULTURAL MORTGAGE CORPORATION.

    Section 8.1(b) (12 U.S.C. 2279aa-1(b)) is amended--
            (1) in paragraph (2), by striking ``and'' at the end;
            (2) in paragraph (3), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(4) purchase qualified loans and issue securities 
        representing interests in, or obligations backed by, the 
        qualified loans, guaranteed for the timely repayment of 
        principal and interest.''.

SEC. 6. POWERS OF THE CORPORATION.

    Section 8.3(c) (12 U.S.C. 2279aa-3(c)) is amended--
            (1) by redesignating paragraphs (13) and (14) as paragraphs 
        (14) and (15), respectively; and
            (2) by inserting after paragraph (12) the following:
            ``(13) To purchase, hold, sell, or assign a qualified loan, 
        to issue a guaranteed security, representing an interest in, or 
        an obligation backed by, the qualified loan, and to perform all 
        the functions and responsibilities of an agricultural mortgage 
        marketing facility operating as a certified facility under this 
        title.''.

SEC. 7. FEDERAL RESERVE BANKS AS DEPOSITORIES AND FISCAL AGENTS.

    Section 8.3 (12 U.S.C. 2279aa-3) is amended--
            (1) in subsection (d), by striking ``may act as 
        depositories for, or'' and inserting ``shall act as 
        depositories for, and''; and
            (2) in subsection (e), by striking ``Secretary of the 
        Treasury may authorize the Corporation to use'' and inserting 
        ``Corporation shall have access to''.

SEC. 8. CERTIFICATION OF AGRICULTURAL MORTGAGE MARKETING FACILITIES.

    Section 8.5 (12 U.S.C. 2279aa-5) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1), by inserting ``(other than 
                the Corporation)'' after ``agricultural mortgage 
                marketing facilities''; and
                    (B) in paragraph (2), by inserting ``(other than 
                the Corporation)'' after ``agricultural mortgage 
                marketing facility''; and
            (2) in subsection (e)(1), by striking ``(other than the 
        Corporation)''.

SEC. 9. GUARANTEE OF QUALIFIED LOANS.

    Section 8.6 (12 U.S.C. 2279aa-6) is amended--
            (1) in subsection (a)(1)--
                    (A) by striking ``Corporation shall guarantee'' and 
                inserting the following: ``Corporation--
                    ``(A) shall guarantee'';
                    (B) by striking the period at the end and inserting 
                ``; and''; and
                    (C) by adding at the end the following:
                    ``(B) may issue a security, guaranteed as to the 
                timely payment of principal and interest, that 
                represents an interest solely in, or an obligation 
                fully backed by, a pool consisting of qualified loans 
                that--
                            ``(i) meet the standards established under 
                        section 8.8; and
                            ``(ii) have been purchased and held by the 
                        Corporation.'';
            (2) in subsection (d)--
                    (A) by striking paragraph (4); and
                    (B) by redesignating paragraphs (5), (6), and (7) 
                as paragraphs (4), (5), and (6), respectively; and
            (3) in subsection (g)(2), by striking ``section 
        8.0(9)(B))'' and inserting ``section 8.0(9))''.

SEC. 10. MANDATORY RESERVES AND SUBORDINATED PARTICIPATION INTERESTS 
              ELIMINATED.

    (a) Guarantee of Qualified Loans.--Section 8.6 (12 U.S.C. 2279aa-6) 
is amended by striking subsection (b).
    (b) Reserves and Subordinated Participation Interests.--Section 8.7 
(12 U.S.C. 2279aa-7) is repealed.
    (c) Conforming Amendments.--
            (1) Section 8.0(9)(B)(i) (12 U.S.C. 2279(9)(B)(i)) is 
        amended by striking ``8.7, 8.8,'' and inserting ``8.8''.
            (2) Section 8.6(a)(2) (12 U.S.C. 2279aa-6(a)(2)) is amended 
        by striking ``subject to the provisions of subsection (b)''.

SEC. 11. STANDARDS REQUIRING DIVERSIFIED POOLS.

    (a) In General.--Section 8.6 (12 U.S.C. 2279aa-6), as amended by 
section 10 of this Act, is amended--
            (1) by striking subsection (c); and
            (2) by redesignating subsections (d) through (g) as 
        subsections (b) through (e), respectively.
    (b) Conforming Amendments.--
            (1) Section 8.0(9)(B)(i) (12 U.S.C. 2279(9)(B)(i)) is 
        amended by striking ``(f)'' and inserting ``(d)''.
            (2) Section 8.13(a) (12 U.S.C. 2279aa-13(a)) is amended by 
        striking ``sections 8.6(b) and'' each place such term appears 
        and inserting ``section''.
            (3) Section 8.32(b)(1)(C) (12 U.S.C. 2279bb-1(b)(1)(C)) is 
        amended--
                    (A) by striking ``shall'' and inserting ``may''; 
                and
                    (B) by inserting ``(as in effect before the date of 
                the enactment of the Farmer Mac Reform Act of 1995)'' 
                before the semicolon.
            (4) Section 8.6(b) (12 U.S.C. 2279aa-6(b)), as so 
        redesignated by subsection (a)(2) of this section, is amended--
                    (A) by striking paragraph (4) (as so redesignated 
                by section 9(2)(B) of this Act); and
                    (B) by redesignating paragraphs (5) and (6) (as so 
                redesignated) as paragraphs (4) and (5), respectively.

SEC. 12. SMALL FARMS.

    Section 8.8(e) (12 U.S.C. 2279aa-8(e)) is amended by adding at the 
end the following: ``The Board shall promote and encourage the 
inclusion of qualified loans for small farms and family farmers in the 
agricultural mortgage secondary market.''.

SEC. 13. DEFINITION OF AN AFFILIATE.

    Section 8.11(e) (21 U.S.C. 2279aa-11(e)) is amended--
            (1) by striking ``a certified facility or''; and
            (2) by striking ``paragraphs (3) and (7), respectively, of 
        section 8.0'' and inserting ``section 8.0(7)''.

SEC. 14. STATE USURY LAWS SUPERSEDED.

    Section 8.12 (12 U.S.C. 2279aa-12) is amended by striking 
subsection (d) and inserting the following:
    ``(d) State Usury Laws Superseded.--A provision of the Constitution 
or law of any State shall not apply to an agricultural loan made by an 
originator or a certified facility in accordance with this title for 
sale to the Corporation or to a certified facility for inclusion in a 
pool for which the Corporation has provided, or has committed to 
provide, a guarantee, if the loan, not later than 180 days after the 
date the loan was made, is sold to the Corporation or included in a 
pool for which the Corporation has provided a guarantee, if the 
provision--
            ``(1) limits the rate or amount of interest, discount 
        points, finance charges, or other charges that may be charged, 
        taken, received, or reserved by an agricultural lender or a 
        certified facility; or
            ``(2) limits or prohibits a prepayment penalty (either 
        fixed or declining), yield maintenance, or make-whole payment 
        that may be charged, taken, or received by an agricultural 
        lender or a certified facility in connection with the full or 
        partial payment of the principal amount due on a loan by a 
        borrower in advance of the scheduled date for the payment under 
        the terms of the loan, otherwise known as a prepayment of the 
        loan principal.''.

SEC. 15. EXTENSION OF CAPITAL TRANSITION PERIOD.

    Section 8.32 (12 U.S.C. 2279bb-1) is amended--
            (1) in the first sentence of subsection (a), by striking 
        ``Not later than the expiration of the 2-year period beginning 
        on December 13, 1991,'' and inserting ``Not sooner than the 
        expiration of the 3-year period beginning on the date of the 
        enactment of the Farmer Mac Reform Act of 1995,'';
            (2) in the first sentence of subsection (b)(2), by striking 
        ``5-year'' and inserting ``8-year''; and
            (3) in subsection (d)--
                    (A) in the first sentence--
                            (i) by striking ``The regulations 
                        establishing'' and inserting the following:
            ``(1) In general.--The regulations establishing''; and
                            (ii) by striking ``shall contain'' and 
                        inserting the following: ``shall--
                    ``(A) be issued by the Director for public comment 
                in the form of a notice of proposed rulemaking, to be 
                first published after the expiration of the period 
                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. 16. MINIMUM CAPITAL LEVEL.

    Section 8.33 (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 Corporation's aggregate off-
        balance sheet obligations, 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
                    ``(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;
                            ``(ii) 0.45 percent of designated on-
                        balance sheet assets as determined under 
                        paragraph (2); and
                            ``(iii) 2.50 percent of on-balance sheet 
                        assets other than designated assets;
                    ``(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;
                            ``(ii) 1.20 percent of designated on-
                        balance sheet assets as determined under 
                        paragraph (2); and
                            ``(iii) 2.55 percent of on-balance sheet 
                        assets other than designated assets;
                    ``(C) during the 1-year period ending December 31, 
                1998, shall be the amount of core capital equal to--
                            ``(i) the sum of--
                                    ``(I) 0.65 percent of aggregate 
                                off-balance sheet obligations;
                                    ``(II) 1.95 percent of designated 
                                on-balance sheet assets as determined 
                                under paragraph (2); and
                                    ``(III) 2.65 percent of on-balance 
                                sheet assets other than designated 
                                assets; 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) Definition of designated on-balance sheet assets.--In 
        this subsection, the term `designated on-balance sheet assets' 
        means the sum of--
                    ``(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. 17. CRITICAL CAPITAL LEVEL.

    Section 8.34 (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 percent of 
the total minimum capital amount determined under section 8.33.''.

SEC. 18. ENFORCEMENT LEVELS.

    Section 8.35(e) (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. 19. RECAPITALIZATION OF THE CORPORATION.

    Title VIII (12 U.S.C. 2279aa et seq.) is amended by adding at the 
end the following:

``SEC. 8.38. 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. 20. BORROWER STOCK.

    Section 4.3A (12 U.S.C. 2154a) is amended--
            (1) by redesignating subsections (f) and (g) as subsections 
        (g) and (h), respectively; and
            (2) by inserting after subsection (e) the following:
    ``(f) Loans Designated for Sale or Sold Into the Secondary 
Market.--
            ``(1) In general.--Subject to paragraph (2) and 
        notwithstanding any other provision of this section, the bylaws 
        adopted by a bank or association under subsection (b) may 
        provide--
                    ``(A) in the case of a loan made on or after the 
                date of enactment of this paragraph that is designated, 
                at the time the loan is made, for sale into a secondary 
                market, that no voting stock or participation 
                certificate purchase requirement shall apply to the 
                borrower for the loan; and
                    ``(B) in the case of a loan made before the date of 
                enactment of this paragraph that is sold into a 
                secondary market, that all outstanding voting stock or 
                participation certificates held by the borrower with 
respect to the loan shall, subject to subsection (d)(1), be retired.
            ``(2) Applicability.--Notwithstanding any other provision 
        of this section, in the case of a loan sold to a secondary 
        market under title VIII, paragraph (1) shall apply regardless 
        of whether the bank or association retains a subordinated 
        participation interest in a loan or pool of loans or 
        contributes to a cash reserve.
            ``(3) Exception.--
                    ``(A) In general.--Subject to subparagraph (B) and 
                notwithstanding any other provision of this section, if 
                a loan designated for sale under paragraph (1)(A) is 
                not sold into a secondary market during the 180-day 
                period that begins on the date of the designation, the 
                voting stock or participation certificate purchase 
                requirement that would otherwise apply to the loan in 
                the absence of a bylaw provision described in paragraph 
                (1)(A) shall be effective.
                    ``(B) Retirement.--The bylaws adopted by a bank or 
                association under subsection (b) may provide that if a 
                loan described in subparagraph (A) is sold into a 
                secondary market after the end of the 180-day period 
                described in the subparagraph, all outstanding voting 
                stock or participation certificates held by the 
                borrower with respect to the loan shall, subject to 
                subsection (d)(1), be retired.''.

SEC. 21. LIQUIDATION OF THE FEDERAL AGRICULTURAL MORTGAGE CORPORATION.

    Title VIII (12 U.S.C. 2279aa et seq.), as amended by section 19 of 
this Act, is amended by adding at the end the following:

``Subtitle C--Receivership; Conservatorship; Liquidation of the Federal 
                   Agricultural Mortgage Corporation

``SEC. 8.41. CONSERVATORSHIP; LIQUIDATION; RECEIVERSHIP.

    ``(a) Voluntary Liquidation.--The Corporation may voluntarily 
liquidate only with the consent of, and in accordance with a plan of 
liquidation approved by, the Farm Credit Administration Board.
    ``(b) Involuntary Liquidation.--The Farm Credit Administration 
Board may appoint a conservator or receiver for the Corporation under 
the circumstances specified in section 4.12(b). The grounds for 
appointment of a conservator for the Corporation shall be in addition 
to those enumerated in section 8.37. In applying section 4.12(b) to the 
Corporation--
            ``(1) 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;
            ``(2) 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
            ``(3) a receiver may also be appointed for the Corporation 
        if--
                    ``(A)(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
                    ``(B) the Farm Credit Administration determines 
                that the appointment of a conservator would not be 
                appropriate.
    ``(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 and, if necessary, to liquidate 
                        the Corporation.
            ``(2) Compensation.--A conservator or receiver for the 
        Corporation and professional personnel (other than Federal 
        employees) employed to represent or assist the conservator or 
        receiver may be compensated for activities conducted as, or 
        for, a conservator or receiver. 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 (but not in excess of rates 
        prevailing in the private sector), if the Farm Credit 
        Administration determines that compensation at higher rates is 
        necessary in order to recruit and retain competent personnel. 
        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 upon such terms and 
        compensation arrangements as shall be mutually agreed, and each 
        entity is hereby authorized to provide the same to the 
        conservator or receiver.
            ``(3) Expenses.--The conservator or receiver shall pay 
        valid claims for expenses of the conservatorship or 
        receivership (including compensation pursuant to paragraph (2)) 
        and valid claims with respect to any loan made under subsection 
        (f) before paying any other valid claim against the 
        Corporation, and such claims may be secured by a lien on such 
        property of the Corporation as the conservator or receiver may 
        determine, which lien 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 
        acts or omissions performed pursuant to and in the course of 
        the conservatorship or receivership, unless such acts or 
        omissions constitute gross negligence or any form of 
        intentional tortious conduct or criminal conduct.
            ``(5) Indemnification.--The Farm Credit Administration may 
        indemnify the conservator or receiver on such terms as the Farm 
        Credit Administration considers appropriate.
    ``(d) Judicial Review of Appointment.--Notwithstanding subsection 
(i)(1), within 30 days after a conservator or receiver is appointed 
pursuant to 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, and the court shall, on the merits, dismiss 
such action or direct the Farm Credit Administration Board to remove 
the conservator or receiver. On the commencement of such an action, any 
court having jurisdiction of any other action or enforcement proceeding 
authorized under this Act to which the Corporation is a party shall 
stay such 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.--If the conservator or 
receiver of the Corporation determines it is likely that there will be 
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 deems necessary or appropriate to meet the 
administrative expenses or liquidity needs of the conservatorship or 
receivership. The Farm Credit Banks are hereby authorized to loan funds 
to the conservator or receiver, and to purchase assets of the 
Corporation, for such purpose.
    ``(g) Agreements Against Interests of Conservator or Receiver.--No 
agreement which tends to diminish or defeat the right, title, or 
interest of the conservator or receiver for the Corporation in any 
asset acquired by it as conservator or receiver for the Corporation 
shall be valid against the conservator or receiver unless the 
agreement--
            ``(1) is in writing;
            ``(2) is executed by the Corporation and any person or 
        persons claiming an adverse interest under the agreement, 
        including the obligor, contemporaneously with the acquisition 
        of the asset by the Corporation;
            ``(3) is approved by the Board or an appropriate committee 
        of the Board, which approval shall be reflected in the minutes 
        of the Board or committee; and
            ``(4) has been, continuously, from the time of its 
        execution, an official record of the Corporation.
    ``(h) Report to the Congress.--Upon a determination by the receiver 
for the Corporation that there are insufficient assets of the 
receivership to pay all valid claims against the receivership, the 
receiver shall submit to the Secretary of the Treasury, the Committee 
on Agriculture of the House of Representatives, and the Committee on 
Agriculture, Nutrition, and Forestry of the Senate a report on the 
financial condition of the receivership.
    ``(i) Termination of Authorities.--
            ``(1) Corporation.--The charter of the Corporation is 
        canceled, and the authority provided to the Corporation by this 
        title shall terminate, at such date as the Farm Credit 
        Administration Board determines is appropriate, following the 
        placement of the Corporation in receivership but not later than 
        the conclusion of the receivership and discharge of the 
        receiver.
            ``(2) Oversight.--The Office of Secondary Market Oversight 
        established pursuant to section 8.11 is abolished, and section 
        8.11(a) and subtitle B shall have no force or effect, at such 
        date as the Farm Credit Administration Board determines is 
        appropriate, following the placement of the Corporation in 
        receivership but not later than the conclusion of the 
        receivership and discharge of the receiver.''.