**1988**—Pub. L. 100–233, title VIII, §805(t)(1), Jan. 6, 1988, 101 Stat. 1716, added heading for part D.

Each production credit association and each Federal land bank association shall elect a nominating committee by vote of the stockholders at the annual meeting to serve for the following year. Each nominating committee shall review lists of farmers from the association territory, determine their willingness to serve, and submit for election a slate of eligible candidates which shall include at least two nominees for each elective office to be filled. In doing so, the committee shall endeavor to assure representation to all sections of the association territory and as nearly as possible to all types of agriculture practiced within the area. Employees of the association shall not be eligible to be nominated, elected, or serve as a member of the board. Nominations shall also be accepted from the floor. Members of the board are not eligible to serve on the nominating committee. Regulations of the Farm Credit Administration governing the election of bank directors shall similarly assure a choice of two nominees for each elective office to be filled and that the bank board represent as nearly as possible all types of agriculture in the district.

(Pub. L. 92–181, title IV, §4.15, Dec. 10, 1971, 85 Stat. 613; Pub. L. 100–399, title IX, §901(g), Aug. 17, 1988, 102 Stat. 1007.)

**1988**—Pub. L. 100–399 substituted “bank directors” for “district directors” and “bank board” for “district board”.

Amendment by Pub. L. 100–399 effective as if enacted immediately after enactment of Pub. L. 100–233, which was approved Jan. 6, 1988, see section 1001(a) of Pub. L. 100–399, set out as a note under section 2002 of this title.

Section, Pub. L. 92–181, title IV, §4.16, Dec. 10, 1971, 85 Stat. 613, prohibited tax-exempt guarantees.

Interest rates on loans from institutions of the Farm Credit System shall not be subject to any interest rate limitation imposed by any State constitution or statute or other laws. Such limitation is preempted for purposes of this chapter. Interest rates on loans made by agricultural credit corporations organized in conjunction with cooperative associations for the purpose of financing the ordinary crop operations of the members of such associations or other producers and eligible to discount with the Federal intermediate credit banks and Farm Credit Banks shall be exempt from any interest rate limitation imposed by any State constitution or statute or other laws which are hereby preempted for purposes of this chapter.

(Pub. L. 92–181, title IV, §4.17, as added Pub. L. 96–592, title IV, §403, Dec. 24, 1980, 94 Stat. 3446; amended Pub. L. 99–205, title II, §205(f)(6), Dec. 23, 1985, 99 Stat. 1706; Pub. L. 99–509, title I, §1035, Oct. 21, 1986, 100 Stat. 1878; Pub. L. 100–399, title IX, §901(h), Aug. 17, 1988, 102 Stat. 1007.)

**1988**—Pub. L. 100–399 substituted “and Farm Credit Banks” for “pursuant to section 2074 of this title”.

**1986**—Pub. L. 99–509 substituted first two sentences for former first sentence which read as follows: “Interest rates on loans from institutions of the Farm Credit System shall be determined with the approval of, as provided in section 2252(a)(5) of this title, the Farm Credit Administration as provided in this chapter, notwithstanding any interest rate limitation imposed by any State constitution or statute or other laws which are hereby preempted for purposes of this chapter.”

**1985**—Pub. L. 99–205 inserted “, as provided in section 2252(a)(5) of this title,” after “with the approval of” in first sentence.

Amendment by Pub. L. 100–399 effective immediately after amendment made by section 401 of Pub. L. 100–233, which was effective 6 months after Jan. 6, 1988, see section 1001(b) of Pub. L. 100–399, set out as a note under section 2002 of this title.

Amendment by Pub. L. 99–205 effective thirty days after Dec. 23, 1985, see section 401 of Pub. L. 99–205, set out as a note under section 2001 of this title.

Notwithstanding any other provisions of this chapter, the terms of any loan participated in by two or more Farm Credit System institutions operating under different subchapters of this chapter, including provisions for capitalization of the portion of the loan participated in by each institution, shall be as may be agreed upon among such institutions and authorized under regulations issued by the Farm Credit Administration, except that for purposes of determining borrower eligibility, membership, term, amount, loan security, and purchase of stock or participation certificates by the borrower, the provisions of law applicable to the loan shall be the provisions in the subchapter under which the institution that originates the loan operates.

(Pub. L. 92–181, title IV, §4.18, as added Pub. L. 96–592, title IV, §403, Dec. 24, 1980, 94 Stat. 3446; amended Pub. L. 99–205, title II, §205(f)(7), Dec. 23, 1985, 99 Stat. 1706.)

**1985**—Pub. L. 98–205 inserted “under regulations issued” after “authorized”.

Amendment by Pub. L. 99–205 effective thirty days after Dec. 23, 1985, see section 401 of Pub. L. 99–205, set out as a note under section 2001 of this title.

As used in this section:

The terms “participate” and “participation” shall have the meaning provided in section 2122(11)(B)(iii) of this title.

The term “similar entity” means a person that—

(A) is not eligible for a loan from the Farm Credit Bank or association; and

(B) has operations that are functionally similar to a person that is eligible for a loan from the Farm Credit Bank or association in that the person derives a majority of the income of the person from, or has a majority of the assets of the person invested in, the conduct of activities that are functionally similar to the activities that are conducted by an eligible person.

Notwithstanding any other provision of this chapter, any Farm Credit Bank or direct lender association chartered under this chapter may participate in any loan of a type otherwise authorized under subchapter I or II of this chapter made to a similar entity by any person in the business of extending credit, except that a Farm Credit Bank or direct lender association may not participate in a loan under this section if—

(1) the participation would cause the total amount of all participations by the Farm Credit Bank or association under this section involving a single credit risk to exceed 10 percent (or the applicable higher lending limit authorized under regulations issued by the Farm Credit Administration if the stockholders of the respective Farm Credit Bank or association so approve) of the total capital of the Farm Credit Bank or association;

(2) the participation by the Farm Credit Bank or association would equal or exceed 50 percent of the principal of the loan or, when taken together with participations in the loan by other Farm Credit System institutions, would cause the cumulative amount of the participations by all Farm Credit System institutions in the loan to equal or exceed 50 percent of the principal of the loan;

(3) the participation would cause the cumulative amount of participations that the Farm Credit Bank or association has outstanding under this section to exceed 15 percent of the total assets of the Farm Credit Bank or association; or

(4) the loan is of the type authorized under section 2019(b) or 2075(a)(2) of this title.

(Pub. L. 92–181, title IV, §4.18A, as added Pub. L. 103–376, §5, Oct. 19, 1994, 108 Stat. 3498; Pub. L. 107–171, title V, §5401(b), May 13, 2002, 116 Stat. 349.)

**2002**—Subsec. (a)(1). Pub. L. 107–171, §5401(b)(1), substituted “2122(11)(B)(iii) of this title” for “2122(11)(B)(iv) of this title”.

Subsec. (c). Pub. L. 107–171, §5401(b)(2), struck out heading and text of subsec. (c). Text read as follows:

“(1)

“(2)

“(3)

(a) Under policies of the district Farm Credit Bank board, each Federal land bank association and production credit association shall prepare a program for furnishing sound and constructive credit and related services to young, beginning, and small farmers and ranchers. Such programs shall assure that such credit and services are available in coordination with other units of the Farm Credit System serving the territory and with other governmental and private sources of credit. Each program shall be subject to review and approval by the supervising bank.

(b) The Farm Credit Bank for each district shall annually obtain from associations under its supervision reports of activities under programs developed pursuant to subsection (a) of this section and progress toward program objectives. On the basis of such reports, the bank shall provide to the Farm Credit Administration an annual report summarizing the operations and achievements in its district under such programs.

(Pub. L. 92–181, title IV, §4.19, as added Pub. L. 96–592, title IV, §403, Dec. 24, 1980, 94 Stat. 3446; amended Pub. L. 100–399, title IX, §901(i), (j), Aug. 17, 1988, 102 Stat. 1007.)

**1988**—Subsec. (a). Pub. L. 100–399, §901(i), inserted “Farm Credit Bank” after “district”.

Subsec. (b). Pub. L. 100–399, §901(j)(1), (2), (4), (5), substituted “The Farm Credit Bank for each district” for “The Federal land bank and the Federal intermediate credit bank for each district”, “under its supervision” for “under their supervision”, “the bank shall” for “the banks shall”, “an annual report” for “a joint annual report”, and “achievements in its district” for “achievements in their district”.

Pub. L. 100–399, §901(j)(3), substituted “subsection (a)” for “subsection (a) of this section”, which for purposes of codification was translated as “subsection (a) of this section”, requiring no change in text.

Amendment by Pub. L. 100–399 effective immediately after amendment made by section 401 of Pub. L. 100–233, which was effective 6 months after Jan. 6, 1988, see section 1001(b) of Pub. L. 100–399, set out as a note under section 2002 of this title.

In any election or merger vote, or other proceeding subject to a vote of the stockholders (or subscribers to the guaranty fund of a bank for cooperatives), conducted by a lending institution of the Farm Credit System, the institution—

(1) may not use signed ballots; and

(2) shall implement measures to safeguard the voting process for the protection of the right of stockholders (or subscribers) to a secret ballot.

(Pub. L. 92–181, title IV, §4.20, as added Pub. L. 96–592, title IV, §403, Dec. 24, 1980, 94 Stat. 3447; amended Pub. L. 100–233, title IV, §425, Jan. 6, 1988, 101 Stat. 1657.)

**1988**—Pub. L. 100–233 amended section generally. Prior to amendment, section read as follows: “The provisions of (1) section 2074 of this title authorizing the Federal intermediate credit banks to lend to or discount paper for other financial institutions, and (2) section 2128(b) of this title authorizing the financing of certain domestic or foreign entities in connection with the import or export activities of cooperatives which are borrowers from the banks for cooperatives, shall expire on September 30, 1990, unless extended by Act of Congress prior to that date. Any contract or agreement entered into under the authority of either provision prior to its expiration shall remain in full force and effect notwithstanding such expiration.”

The Farm Credit Administration shall monitor the compensation of members of the board of directors of a System bank received as compensation for serving as a director of the bank to ensure that the amount of the compensation does not exceed a level of $20,000 per year, as adjusted to reflect changes in the Consumer Price Index for all urban consumers published by the Bureau of Labor Statistics, unless the Farm Credit Administration determines that such level adversely affects the safety and soundness of the bank.

The Farm Credit Administration may waive the limitation prescribed in subsection (a) of this section under exceptional circumstances, as determined in accordance with regulations promulgated by the Farm Credit Administration.

(Pub. L. 92–181, title IV, §4.21, as added Pub. L. 100–399, title IV, §414, Aug. 17, 1988, 102 Stat. 1004; amended Pub. L. 102–552, title V, §509, Oct. 28, 1992, 106 Stat. 4132.)

**1992**—Pub. L. 102–552 amended section generally. Prior to amendment, section read as follows: “No member of the board of directors of a System bank may receive more than $15,000 per year under this chapter as compensation for serving as a director of such bank.”

Section effective immediately after amendment made by section 401 of Pub. L. 100–233, which was effective 6 months after Jan. 6, 1988, see section 1001(b) of Pub. L. 100–399, set out as an Effective Date of 1988 Amendment note under section 2002 of this title.