12 U.S.C. § 2155 — Liability of banks; United States not liable

Page 1327 TITLE 12—BANKS AND BANKING § 2155 1608; amended Pub. L. 100–399, title III, § 301(b)–(f), Aug. 17, 1988, 102 Stat. 994; Pub. L. 102–552, title I, § 101, Oct. 28, 1992, 106 Stat. 4103; Pub. L. 104–105, title II, § 206, Feb. 10, 1996, 110 Stat. 173; Pub. L. 110–234, title V, § 5403(b), May 22, 2008, 122 Stat. 1154; Pub. L. 110–246, § 4(a), title V, § 5403(b), June 18, 2008, 122 Stat. 1664, 1916.) Editorial Notes CODIFICATION Pub. L. 110–234 and Pub. L. 110–246 made identical amendments to this section. The amendments by Pub. L. 110–234 were repealed by section 4(a) of Pub. L. 110–246. AMENDMENTS 2008—Subsec. (c)(1)(D)(ii) to (iv). Pub. L. 110–246, § 5403(b), added cl. (ii) and redesignated former cls. (ii) and (iii) as (iii) and (iv), respectively. 1996—Subsecs. (f) to (h). Pub. L. 104–105 added subsec. (f) and redesignated former subsecs. (f) and (g) as (g) and (h), respectively. 1992—Subsec. (a)(1). Pub. L. 102–552 amended par. (1) generally. Prior to amendment, par. (1) read as follows: ‘‘The term ‘permanent capital’ means current year re- tained earnings, allocated and unallocated earnings, all surplus (less allowances for losses), and stock issued by a System institution, except stock that— ‘‘(A) may be retired by the holder thereof on repay- ment of the holder’s loan, or otherwise at the option or request of the holder; or ‘‘(B) is protected under section 2162 of this title or is otherwise not at risk.’’ 1988—Subsec. (a)(1)(B). Pub. L. 100–399, § 301(b), sub- stituted ‘‘section 2162 of this title’’ for ‘‘section 4.9B’’. Subsec. (c)(1)(D)(i). Pub. L. 100–399, § 301(c)(1), sub- stituted ‘‘producers or’’ for ‘‘producers, or’’. Subsec. (c)(1)(G). Pub. L. 100–399, § 301(c)(2), sub- stituted ‘‘voting stock issued’’ for ‘‘stock issued’’. Subsec. (c)(1)(H). Pub. L. 100–399, § 301(d), inserted ‘‘, except as otherwise provided in this section’’ after ‘‘the borrower’’. Subsec. (c)(1)(I). Pub. L. 100–399, § 301(e), struck out ‘‘standards issued under’’ after ‘‘established under’’. Subsec. (d)(1). Pub. L. 100–399, § 301(f), struck out ‘‘and in section 2162 of this title’’ after ‘‘paragraph (2)’’ and ‘‘or allocated equities’’ after ‘‘retirement of stock’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2008 AMENDMENT Amendment of this section and repeal of Pub. L. 110–234 by Pub. L. 110–246 effective May 22, 2008, the date of enactment of Pub. L. 110–234, see section 4 of Pub. L. 110–246, set out as an Effective Date note under section 8701 of Title 7, Agriculture. EFFECTIVE DATE OF 1988 AMENDMENT Amendment by Pub. L. 100–399 effective as if enacted immediately after enactment of Pub. L. 100–233, which was approved Jan. 6, 1988, see section 1001(a) of Pub. L. 100–399, set out as a note under section 2002 of this title. § 2155. Liability of banks; United States not liable (a) Joint and several liability of banks (1) Each bank of the System shall be fully lia- ble on notes, bonds, debentures, or other obliga- tions issued by it individually, and shall be lia- ble for the interest payments on long-term notes, bonds, debentures, or other obligations issued by other banks operating under the same subchapter of this chapter. (2)(A) Each bank shall also be primarily liable for the portion of any issue of consolidated or System-wide obligations made on its behalf and be jointly and severally liable for the payment of any additional sums as called upon by the Farm Credit Administration in order to make payments of interest or principal which any bank primarily liable therefor shall be unable to make. (B) Such calls first shall be made on all non- defaulting banks in proportion to each such bank’s proportionate share of the aggregate available collateral held by all such banks. (C) For purposes of this paragraph, the term ‘‘available collateral’’ means the amount (deter- mined at the close of the last calendar quarter ending before such call) by which a bank’s col- lateral as described in section 2154 of this title exceeds the collateral required to support the bank’s outstanding notes, bonds, debentures, and other similar obligations. (D) If the Farm Credit Administration makes any such call and the available collateral of all such banks does not fully satisfy the liability necessitating such calls, such calls shall be made on all nondefaulting banks in proportion to each such bank’s remaining assets. (E) Any System bank that, pursuant to a call by the Farm Credit Administration, makes a payment of principal or interest to the holder of any consolidated or System-wide obligation issued on behalf of another System bank shall be subrogated to all rights of the holder against such other bank to the extent of such payment. (F) On making such a call with respect to obli- gations issued on behalf of a System bank, the Farm Credit Administration shall appoint a re- ceiver for the bank, which shall expeditiously liquidate or otherwise wind up the affairs of the bank. (b) Resolutions as to liability; execution of obli- gations Each bank participating in an issue shall by appropriate resolution undertake such responsi- bility as provided in subsection (a), and in the case of consolidated or System-wide obligations shall authorize the execution of such long-term notes, bonds, debentures, or other obligations on its behalf. When a consolidated or System-wide issue is approved, the notes, bonds, debentures, or other obligations shall be executed and the banks shall be liable thereon as provided herein. (c) United States liability The United States shall not be liable or as- sume any liability directly or indirectly there- on. (d) Insurance Fund called on before invoking joint and several liability Beginning 5 years after January 6, 1988, the Farm Credit Administration shall not call on any System institution to satisfy the liability of the institution on any joint, consolidated, or System-wide obligation participated in by the institution or with respect to which the institu- tion is primarily, or jointly and severally, lia- ble, before the Farm Credit Insurance Fund is exhausted, even if the Fund is only able to make a partial payment because of insufficient amounts in the Fund. (Pub. L. 92–181, title IV, § 4.4, Dec. 10, 1971, 85 Stat. 611; Pub. L. 99–205, title I, § 101(4), title II, Page 1328 TITLE 12—BANKS AND BANKING § 2156 § 205(f)(2), Dec. 23, 1985, 99 Stat. 1679, 1706; Pub. L. 100–233, title II, § 207(c), title III, § 303, Jan. 6, 1988, 101 Stat. 1608, 1620; Pub. L. 100–399, title III, § 303, Aug. 17, 1988, 102 Stat. 995.) Editorial Notes AMENDMENTS 1988—Subsec. (a). Pub. L. 100–233, § 303(a), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: ‘‘Each bank of the System shall be fully liable on notes, bonds, debentures, or other obli- gations issued by it individually, and shall be liable for the interest payments on long-term notes, bonds, de- bentures, or other obligations issued by other banks op- erating under the same subchapter of this chapter. Each bank shall also be primarily liable for the portion of any issue of consolidated or System-wide obligations made on its behalf and be jointly and severally liable for the payment of any additional sums as called upon by the Farm Credit Administration in order to make payments of interest or principal which any bank pri- marily liable therefor shall be unable to make. Such calls shall be made first upon the other banks oper- ating under the same subchapter of this chapter as the defaulting bank, and second upon banks operating under other subchapters of this chapter, taking into consideration the capital, surplus, bonds, debentures, or other obligations which each may have outstanding at the time of such assessment.’’ Subsec. (c). Pub. L. 100–233, § 207(c), redesignated sub- sec. (d) as (c), and struck out former subsec. (c) which provided that for purposes of this part, the term ‘‘bank’’ included the Capital Corporation. Subsec. (d). Pub. L. 100–399 redesignated subsec. (e) as (d). Pub. L. 100–233, § 207(c), redesignated subsec. (d) as (c). Subsec. (e). Pub. L. 100–399 redesignated subsec. (e) as (d). Pub. L. 100–233, § 303(b), added subsec. (e). 1985—Subsec. (b). Pub. L. 99–205, § 205(f)(2), substituted ‘‘execution of’’ for ‘‘Governor to execute’’ in first sen- tence and struck out ‘‘by the Governor’’ after ‘‘shall be executed’’ in second sentence. Subsecs. (c), (d). Pub. L. 99–205, § 101(4), added subsec. (c) and redesignated former subsec. (c) as (d). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1988 AMENDMENT Amendment by Pub. L. 100–399 effective as if enacted immediately after enactment of Pub. L. 100–233, which was approved Jan. 6, 1988, see section 1001(a) of Pub. L. 100–399, set out as a note under section 2002 of this title. EFFECTIVE DATE OF 1985 AMENDMENT Amendment by Pub. L. 99–205 effective thirty days after Dec. 23, 1985, see section 401 of Pub. L. 99–205, set out as a note under section 2001 of this title. § 2156. Repealed. Pub. L. 100–233, title II, § 204(b), Jan. 6, 1988, 101 Stat. 1607 Section, Pub. L. 92–181, title IV, § 4.5, Dec. 10, 1971, 85 Stat. 611; Pub. L. 96–592, title IV, § 401, Dec. 24, 1980, 94 Stat. 3446; Pub. L. 99–205, title II, § 205(f)(3), Dec. 23, 1985, 99 Stat. 1706, provided for establishment of a fi- nance committee for banks organized and operated under subchapters I, II, and III of this chapter. See sec- tion 2160 of this title. § 2157. Bonds as investments The bonds, debentures, and other similar obli- gations issued under the authority of this chap- ter shall be lawful investments for all fiduciary and trust funds and may be accepted as security for all public deposits. (Pub. L. 92–181, title IV, § 4.6, Dec. 10, 1971, 85 Stat. 612.) § 2158. Purchase and sale by Federal Reserve System Any member of the Federal Reserve System may buy and sell bonds, debentures, or other similar obligations issued under the authority of this chapter and any Federal Reserve bank may buy and sell such obligations to the same extent and subject to the same limitations placed upon the purchase and sale by said banks of State, county, district, and municipal bonds under sec- tion 355 of this title. (Pub. L. 92–181, title IV, § 4.7, Dec. 10, 1971, 85 Stat. 612.) § 2159. Purchase and sale of obligations Each bank of the System may purchase its own obligations and the obligations of other banks of the System and may provide for the sale of obligations issued by it, consolidated ob- ligations, or Systemwide obligations through a fiscal agent or agents, by negotiation, offer, bid, syndicate sale, and to deliver such obligations by book entry, wire transfer, or such other means as may be appropriate. (Pub. L. 92–181, title IV, § 4.8, Dec. 10, 1971, 85 Stat. 612; Pub. L. 99–509, title I, § 1034, Oct. 21, 1986, 100 Stat. 1878; Pub. L. 100–233, title II, § 205(a), Jan. 6, 1988, 101 Stat. 1607; Pub. L. 115–334, title V, § 5411(18), Dec. 20, 2018, 132 Stat. 4680.) Editorial Notes AMENDMENTS 2018—Pub. L. 115–334 struck out subsec. (a) designa- tion before ‘‘Each bank’’ and struck out subsec. (b) which described conditions under which each bank of the System could reduce the cost of its borrowings and amortize certain capitalizations through Dec. 31, 1992. 1988—Subsec. (b). Pub. L. 100–233 substituted ‘‘Decem- ber 31, 1992’’ for ‘‘December 31, 1988’’ in two places. 1986—Pub. L. 99–509 designated existing provisions as subsec. (a) and added subsec. (b). § 2160. Federal Farm Credit Banks Funding Cor- poration (a) Establishment There is hereby established the Federal Farm Credit Banks Funding Corporation (hereinafter in this section referred to as the ‘‘Corporation’’), which shall be an institution of the Farm Credit System. (b) Duties The Corporation— (1) shall issue, market, and handle the obli- gations of the banks of the Farm Credit Sys- tem, and interbank or intersystem flow of funds as may from time to time be required; (2) acting for the banks of the Farm Credit System, subject to approval of the Farm Cred- it Administration, shall determine the amount, maturities, rates of interest, terms, and conditions of participation by the several banks in each issue of joint, consolidated, or System-wide obligations; and (3) shall exercise such other powers as were provided to the predecessor Federal Farm