[Federal Register Volume 79, Number 173 (Monday, September 8, 2014)]
[Rules and Regulations]
[Pages 53127-53128]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-21319]



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  Federal Register / Vol. 79, No. 173 / Monday, September 8, 2014 / 
Rules and Regulations  

[[Page 53127]]



FARM CREDIT ADMINISTRATION

12 CFR Part 652

RIN 3052-AC83


Federal Agricultural Mortgage Corporation Funding and Fiscal 
Affairs; Farmer Mac Liquidity Management; Correction

AGENCY: Farm Credit Administration.

ACTION: Final rule; correcting amendment.

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SUMMARY: The Farm Credit Administration (FCA) published a final rule in 
the Federal Register on November 1, 2013 to strengthen liquidity risk 
management at the Federal Agricultural Mortgage Corporation, improve 
the quality of assets in its liquidity reserves, and bolster its 
ability to fund its obligations and continue operations during times of 
economic, financial, or market adversity. This document corrects and 
clarifies the section amended by final rule.

DATES: Effective April 30, 2014.

FOR FURTHER INFORMATION CONTACT: Joseph T. Connor, Associate Director 
for Policy and Analysis, Office of Secondary Market Oversight, Farm 
Credit Administration, McLean, VA 22102-5090, (703) 883-4280, TTY (703) 
883-4056; or Richard A. Katz, Senior Counsel, Office of General 
Counsel, Farm Credit Administration, McLean, VA 22102-5090, (703) 883-
4020, TTY (703) 883-4056.

SUPPLEMENTARY INFORMATION: The FCA published a final rule in the 
Federal Register on November 1, 2013, (78 FR 65541) amending part 652. 
This final rule was corrected on May 20, 2014 (79 FR 28810) to 
accurately reflect the addition of new definitions. The final rule 
became effective on April 30, 2014. See 79 FR 29074, May 21, 2014. Due 
to a technical error in the language used in both the correction 
document and effective date notice, a portion of 12 CFR 652.5 was 
inadvertently removed. This correcting amendment reinstates the section 
as was intended by both the November 1, 2013, rule and its May 20, 
2014, correction.

List of Subjects in 12 CFR Part 652

    Agriculture, Banks, Banking, Capital, Investments, Rural areas.

    For reasons stated in the preamble, the FCA amends 12 CFR part 652 
with the following correcting amendment:

PART 652--FEDERAL AGRICULTURAL MORTGAGE CORPORATION FUNDING AND 
FISCAL AFFAIRS

0
1. The authority citation for part 652 continues to read as follows:

    Authority:  Secs. 4.12, 5.9, 5.17, 8.11, 8.31, 8.32, 8.33, 8.34, 
8.35, 8.36, 8.37, 8.41 of the Farm Credit Act (12 U.S.C. 2183, 2243, 
2252, 2279aa-11, 2279bb, 2279bb-1, 2279bb-2, 2279bb-3, 2279bb-4, 
2279bb-5, 2279bb-6, 2279cc); sec. 514 of Pub. L. 102-552, 106 Stat. 
4102; sec. 118 of Pub. L. 104-105, 110 Stat. 168; sec. 939A of Pub. 
L. 11-203, 124 Stat. 1326, 1887 (15 U.S.C. 78o-7 note) (July 21, 
2010).

0
2. Revise Sec.  652.5 to read as follows:


Sec.  652.5  Definitions.

    For purposes of this subpart, the following definitions will apply:
    Affiliate means any entity established under authority granted to 
the Corporation under section 8.3(c)(14) of the Farm Credit Act of 
1971, as amended.
    Asset-backed securities (ABS) mean investment securities that 
provide for ownership of a fractional undivided interest or collateral 
interests in specific assets of a trust that are sold and traded in the 
capital markets. For the purposes of this subpart, ABS exclude mortgage 
securities that are defined below.
    Cash means cash balances held at Federal Reserve Banks, proceeds 
from traded-but-not-yet-settled debt, and deposit accounts at Federal 
Deposit Insurance Corporation-insured banks.
    Contingency Funding Plan (CFP) is described in Sec.  652.35(d)(2).
    Eurodollar time deposit means a non-negotiable deposit denominated 
in United States dollars and issued by an overseas branch of a United 
States bank or by a foreign bank outside the United States.
    Farmer Mac, Corporation, you, and your means the Federal 
Agricultural Mortgage Corporation and its affiliates.
    FCA, our, us, or we means the Farm Credit Administration.
    Final maturity means the last date on which the remaining principal 
amount of a security is due and payable (matures) to the registered 
owner. It does not mean the call date, the expected average life, the 
duration, or the weighted average maturity.
    General obligations of a state or political subdivision means:
    (1) The full faith and credit obligations of a state, the District 
of Columbia, the Commonwealth of Puerto Rico, a territory or possession 
of the United States, or a political subdivision thereof that possesses 
general powers of taxation, including property taxation; or
    (2) An obligation that is unconditionally guaranteed by an obligor 
possessing general powers of taxation, including property taxation.
    Government agency means the United States or an agency, 
instrumentality, or corporation of the United States Government whose 
obligations are fully and explicitly insured or guaranteed as to the 
timely repayment of principal and interest by the full faith and credit 
of the United States Government.
    Government-sponsored agency means an agency, instrumentality, or 
corporation chartered or established to serve public purposes specified 
by the United States Congress but whose obligations are not fully and 
explicitly insured or guaranteed by the full faith and credit of the 
United States Government, including but not limited to any Government-
sponsored enterprise.
    Liability Maturity Management Plan (LMMP) is described in Sec.  
652.35(d)(2)(iv).
    Liquid investments are assets that can be promptly converted into 
cash without significant loss to the investor. A security is liquid if 
the spread between its bid price and ask price is narrow and a 
reasonable amount can be sold at those prices promptly.
    Liquidity reserve is described in Sec.  652.40.
    Long-Term Standby Purchase Commitment (LTSPC) is a commitment by 
Farmer Mac to purchase specified eligible loans on one or more 
undetermined future dates. In consideration for Farmer Mac's assumption 
of the credit risk on the specified loans underlying an LTSPC, Farmer 
Mac receives an annual

[[Page 53128]]

commitment fee on the outstanding balance of those loans in monthly 
installments based on the outstanding balance of those loans.
    Market risk means the risk to your financial condition because the 
value of your holdings may decline if interest rates or market prices 
change. Exposure to market risk is measured by assessing the effect of 
changing rates and prices on either the earnings or economic value of 
an individual instrument, a portfolio, or the entire Corporation.
    Maturing obligations means maturing debt and other obligations that 
may be expected, such as buyouts of long-term standby purchase 
commitments or repurchases of agricultural mortgage securities.
    Mortgage securities means securities that are either:
    (1) Pass-through securities or participation certificates that 
represent ownership of a fractional undivided interest in a specified 
pool of residential (excluding home equity loans), multifamily or 
commercial mortgages, or
    (2) A multiclass security (including collateralized mortgage 
obligations and real estate mortgage investment conduits) that is 
backed by a pool of residential, multifamily or commercial real estate 
mortgages, pass-through mortgage securities, or other multiclass 
mortgage securities.
    (3) This definition does not include agricultural mortgage-backed 
securities guaranteed by Farmer Mac itself.
    Nationally recognized statistical rating organization (NRSRO) means 
a rating organization that the Securities and Exchange Commission 
recognizes as an NRSRO.
    Non-program investments means investments other than those in:
    (1) ``Qualified loans'' as defined in section 8.0(9) of the Farm 
Credit Act of 1971, as amended; or
    (2) Securities collateralized by ``qualified loans.''
    OSMO means FCA's Office of Secondary Market Oversight.
    Program assets means on-balance sheet ``qualified loans'' as 
defined in section 8.0(9) of the Farm Credit Act of 1971, as amended.
    Program obligations means off-balance sheet ``qualified loans'' as 
defined in section 8.0(9) of the Farm Credit Act of 1971, as amended.
    Regulatory capital means your core capital plus an allowance for 
losses and guarantee claims, as determined in accordance with generally 
accepted accounting principles.
    Revenue bond means an obligation of a municipal government that 
finances a specific project or enterprise, but it is not a full faith 
and credit obligation. The obligor pays a portion of the revenue 
generated by the project or enterprise to the bondholders.
    Weighted average life (WAL) means the average time until the 
investor receives the principal on a security, weighted by the size of 
each principal payment and calculated under specified prepayment 
assumptions.

    Dated: September 3, 2014.
Dale L. Aultman,
Secretary, Farm Credit Administration Board.
[FR Doc. 2014-21319 Filed 9-5-14; 8:45 am]
BILLING CODE 6705-01-P