Rural Community Investments - Proposed Rule - Comments received after 8/15/08 Terry O'Connor Senior Vice-President Horicon Bank N7850 Louise Lane Randolph, WI 53956-9759
August 18, 2008
Gary Van Meter Deputy Director, Office of Regulatory Policy 1501 Farm Credit Drive McLean, VA 22102
Dear Gary Van Meter:
I am writing to express my opposition to the Farm Credit Administration's (FCA) proposed rule that would allow Farm Credit System (FCS) lenders to invest up to 150 percent of their capital surplus on projects unrelated to agriculture.
This proposed rule would shift the FCS away from its statutory mission to agriculture by authorizing FCS institutions to finance hospitals, healthcare facilities, transportation infrastructure, hotels, office parks, manufacturing facilities, and any other types of investments FCA identifies as appropriate.
The proposed rule raises safety and soundness issues.
The proposed FCA rule would permit FCS institutions to invest up to $36 billion of their owners' capital surplus in speculative investments that the FCA has little or no experience in evaluating for safety and soundness.
The System should not be allowed to make investments in areas where it has no experience, no loan making authority, no branch networks, and no authority granted by Congress.
The Farm Credit System is a government-sponsored enterprise (GSE) created by Congress, with certain advantages and limitations, to serve a specific mission. This proposed rule moves the FCS away from that mission.
I respectfully urge the Farm Credit Administration to withdraw this proposed rule on "mission-related activities" for the reasons stated above.
Terry O'Connor 920-887-8350 Senior Vice-President Horicon Bank
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