Statute: 1971 ACT AS AMENDED
Title: Title IV Provisions Applicable to Two or More Classes of Institutions of the System
Part: Part C Rights of Borrowers; Loan Restructuring
U.S. Code Citation: 12 U.S.C. 2202c
12 U.S.C. 2202c SEC. 4.14C. REVIEW OF RESTRUCTURING DENIALS.
(a) REQUIREMENTS FOR RESTRUCTURING BY SYSTEM INSTITUTIONS.
(1) EXISTING NONACCRUAL LOANS. Within 9 months after a qualified lender is certified under section 6.4, such lender shall review each loan that has not been previously restructured and that is in nonaccrual status on the date the lender is certified, and determine whether to restructure the loan.
(2) NEW NONACCRUAL LOANS. Within 6 months after a loan made by a certified lender is placed in nonaccrual status, the lender shall determine whether to restructure the loan.
(b) SPECIAL ASSET GROUPS.
(1) ESTABLISHMENT. Within 30 days after a qualified lender in a district is certified to issue preferred stock under section 6.27, the Farm Credit Bank board shall establish a special asset group that shall review each determination by the lender not to restructure a loan.
(2) RESTRUCTURING PLAN. If a special asset group determines under paragraph (1) that a loan under review should be restructured, the group shall prescribe a restructuring plan for the loan that the qualified lender shall implement.
(c) NATIONAL SPECIAL ASSET COUNCIL.
(1) ESTABLISHMENT. A National Special Asset Council shall be established by the Assistance Board to—
(A) monitor compliance with the restructuring requirements of this section by qualified lenders certified to issue preferred stock under section 6.27, and by special asset groups established under subsection (b) of this section; and
(B) review a sample of determinations made by each special asset group that a loan will not be restructured.
(2) REVIEW OF DETERMINATION. The National Special Asset Council shall review a sufficient number of determinations made by each special asset group to foreclose on any loan to assure the Council that such group is complying with this section. With regard to each determination reviewed, the Council shall make an independent judgment on the merits of the decision to foreclose rather than restructure the loan.
(3) NONCOMPLIANCE. If the National Special Asset Council determines that any special asset group is not in substantial compliance with this section, the Council shall notify the group of the determination, and may take such other action as the Council considers necessary to ensure that such group complies with this section.
(d) REPORT. With respect to determinations by a special asset group that a loan will not be restructured, the special asset group shall submit to the National Special Asset Council a report evaluating the loan and the basis for the determination that the loan should not be restructured.
(e) RESTRUCTURING FACTORS. In determining whether a loan is to be restructured, the National Special Asset Council, each special asset group, and each qualified lender certified under section 6.4 shall take into consideration the factors specified in section 4.14A(d)(1).
[FCA Home | FCA Handbook]