
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 12USC2279bb-6]

 
                       TITLE 12--BANKS AND BANKING
 
                     CHAPTER 23--FARM CREDIT SYSTEM
 
         SUBCHAPTER VIII--AGRICULTURAL MORTGAGE SECONDARY MARKET
 
    Part B--Regulation of Financial Safety and Soundness of Federal 
                    Agricultural Mortgage Corporation
 
Sec. 2279bb-6. Supervisory actions applicable to level III


(a) Mandatory supervisory actions

                    (1) Capital restoration plan

        If the Corporation is classified as within level III, the 
    Corporation shall, within the time period determined by the 
    Director, submit to the Director a capital restoration plan and, 
    after approval, carry out the plan.

                    (2) Restrictions on dividends

        (A) Prior approval

            If the Corporation is classified as within level III, the 
        Corporation--
                (i) may not make any payment of dividends that would 
            result in the Corporation being reclassified as within level 
            IV; and
                (ii) may make any other payment of dividends only if the 
            Director approves the payment before the payment.

        (B) Standard for approval

            If the Corporation is classified as within level III, the 
        Director may approve a payment of dividends by the Corporation 
        only if the Director determines that the payment (i) will 
        enhance the ability of the Corporation to meet the risk-based 
        capital level and the minimum capital level promptly, (ii) will 
        contribute to the long-term safety and soundness of the 
        Corporation, or (iii) is otherwise in the public interest.

           (3) Reclassification from level III to level IV

        The Director shall immediately reclassify the Corporation as 
    within level IV if--
            (A) the Corporation is classified as within level III; and
            (B)(i) the Corporation does not submit a capital restoration 
        plan that is approved by the Director; or
            (ii) the Director determines that the Corporation has failed 
        to make, in good faith, reasonable efforts necessary to comply 
        with such a capital restoration plan and fulfill the schedule 
        for the plan approved by the Director.

(b) Discretionary supervisory actions

    In addition to any other actions taken by the Director (including 
actions under subsection (a) of this section), the Director may, at any 
time, take any of the following actions if the Corporation is classified 
as within level III:

              (1) Limitation on increase in obligations

        Limit any increase in, or order the reduction of, any 
    obligations of the Corporation, including off-balance sheet 
    obligations.

                      (2) Limitation on growth

        Limit or prohibit the growth of the assets of the Corporation or 
    require contraction of the assets of the Corporation.

                    (3) Prohibition on dividends

        Prohibit the Corporation from making any payment of dividends.

                   (4) Acquisition of new capital

        Require the Corporation to acquire new capital in any form and 
    in any amount sufficient to provide for the reclassification of the 
    Corporation as within level II.

                    (5) Restriction of activities

        Require the Corporation to terminate, reduce, or modify any 
    activity that the Director determines creates excessive risk to the 
    Corporation.

                         (6) Conservatorship

        Appoint a conservator for the Corporation consistent with this 
    chapter.

(c) Effective date

    This section shall take effect on January 1, 1992.

(Pub. L. 92-181, title VIII, Sec. 8.37, as added Pub. L. 102-237, title 
V, Sec. 503(b)(2), Dec. 13, 1991, 105 Stat. 1876.)

                  Section Referred to in Other Sections

    This section is referred to in sections 2279bb-4, 2279bb-5, 2279cc 
of this title.
