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Informational Memorandum
Subject:Temporary Relief for Agricultural Producers Under Stress
Date of Memorandum:02/15/2002
Expiration Date:
Office:OE
Signed By:Smith, Roland
FCA Contact Person:Smith, Roland
Contact Phone:703-883-4121
List of Attachments:FCA Examination Bulletin 2002-1


INFORMATIONAL MEMORANDUM


February 15, 2002


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

From: Roland E. Smith, Chief Examiner
Office of Examination

Subject: Temporary Relief for Agricultural Producers Under Stress

Over the past several years, most Farm Credit System (System) institutions have maintained consistently low levels of high-risk assets. Undoubtedly, the continuation of federal government support to agriculture and the commitment of System institutions to work with borrowers have contributed to this favorable condition. However, many agricultural producers do not directly benefit from government support programs, and recent discussions with System personnel have confirmed that these producers are currently operating in a stressful economic environment. As a result, many of these producers may have difficulty meeting debt obligations.

To further address this issue of working with producers experiencing financial stress, the attached examination bulletin was developed for distribution to our examiners. The bulletin addresses what associations can and should do when working with borrowers experiencing financial stress. The bulletin also instructs examiners to remind associations of their obligations regarding “borrower rights” requirements in the Farm Credit Act. While the guidance provided by this bulletin is not new, we believe this bulletin will send an important reminder to the examiners regarding associations taking proactive measures to provide relief and solutions for distressed borrowers that benefit the borrower and the association.

Please review the attached examination bulletin and share it with appropriate staff in your institution. If you have any questions regarding the information contained in the examination bulletin, please call the director of your respective Farm Credit Administration field office, or me at (703) 883-4160, or correspond on the Internet at e-mail address Smithr@FCA.gov.

Attachment

Examination Bulletin 2002-1.doc