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Informational Memorandum
Subject:Deregulation of the Farm Credit System: Implementation of the Philosophy Statement
Date of Memorandum:03/08/2000
Expiration Date:
Signed By:Reyna, Michael & Jorgensen Ann
FCA Contact Person:McMahon, Eileen
Contact Phone:703-883-4235
List of Attachments:


March 8, 2000

To: Chairman, Board of Directors
Chief Executive Officer
Each Farm Credit System Institution

From: Michael M. Reyna Ann Jorgensen
Chairman and Chief Executive Officer Board Member

Subject: Deregulation of the Farm Credit System: Implementation of the Philosophy Statement

The Farm Credit Administration (FCA or Agency) Board, in the first of a series of meetings held annually with Farm Credit System (FCS or System) institutions, announced plans to implement two initiatives embodied in its Philosophy Statement. The desired outcome of these initiatives is to deregulate FCS institutions so that they will remain relevant to the ever-changing credit needs of agriculture and rural America.

The FCA Board approved this philosophy statement in July 1998, after considerable research on System and market changes. The Agency has, in the interim, researched strategies that conform to the Farm Credit Act and maximize opportunities for borrowers in agriculture and rural America.

FCA’s first priority is to remove geographic barriers by granting national charters to FCS direct lender associations:

During discussions at the first meeting, the FCA Board noted that good progress is being made on Federal Land Bank Association conversions and all are expected to be completed by October 1. Thus, all associations will have direct lender status by this fall and will be on equal footing.

The second phase of this plan involves cross titles -- Titles I and II -- for direct lender associations:
The FCA Board expects to continue discussions at the remaining Information Exchange meetings, which will be completed in April. The FCA Board also plans to provide further guidance in the near future.