12 C.F.R. Subpart M—Loan Approval Requirements
Title 12 - Banks and Banking
Authority for loan approval is vested in the Farm Credit banks and associations. [51 FR 41947, Nov. 20, 1986] Approval of the following loans is the responsibility of each district board of directors. The responsibility may be discharged by prior approval of such loans by the appropriate bank board, or establishment of a policy under which the authority to approve such loans is delegated to bank management (except paragraphs (d) and (e) of this section which cannot be delegated to management). If the approval of such loans is to be delegated to bank management, the loans are to be submitted promptly for post review by the bank board and a report disclosing all material facts relating to the credit relationship involved shall be submitted annually by bank management to the district board. (a) Loans to a member of the Farm Credit Administration Board. (b) Loans to a member of the district board. (c) Loans to a cooperative of which a member of a bank board of directors is a member of the board of directors, an officer, or employee. (d) Loans to the president of a Farm Credit bank. (e) Loans to employees of the Farm Credit Administration. (f) Loans where directors, officers or employees designated above: (1) Are to receive proceeds of the loan in excess of an amount prescribed by an appropriate bank board, or (2) Are stockholders or owners of equity in a legal entity to which the loan is to be made wherein they have a significant personal or beneficial interest in the loan proceeds thereof or the security, or (3) Are endorsers, guarantors or co-makers in excess of an amount prescribed by an appropriate bank board. [38 FR 27837, Oct. 9, 1973, as amended at 39 FR 29585, Aug. 16, 1974. Redesignated at 46 FR 51878, Oct. 22, 1981, and amended at 51 FR 41947, Nov. 20, 1986; 54 FR 1151, Jan. 12, 1989; 54 FR 50736, Dec. 11, 1989; 56 FR 2674, Jan. 24, 1991] (a) The following loans (unless such loans are of a type prohibited under part 612) shall be subject to prior approval of the bank supervising the association in which the loan application originates: (1) Loans to a director of the association. (2) Loans to a director of an association which is under joint management when the application originates in one of the associations. (3) Loans to an employee of the association. (4) Loans to an employee of an association which is under joint management when the application originates in one of the associations. (5) Loans to bank employees when the application originates in one of the associations supervised by the employing bank. (b) Loans to any borrower shall be subject to the prior approval of the bank supervising the association in which the loan application originates whenever a director or an employee of the association or an employee of the bank supervising the association: (1) Will receive proceeds of the loan in excess of the amount prescribed by the supervising bank board, or (2) Has a significant personal or beneficial interest in the loan, the proceeds, or the security, or controls the borrower, or (3) Is an endorser, guarantor, or comaker with respect to the loan in excess of an amount prescribed by the supervising bank board. (c) Any loan which will result in any one borrower being obligated (as defined in subpart J of this part) in excess of an amount established by the supervising bank under its policies for delegation of authority to associations shall be subject to prior approval of the supervising bank. [47 FR 49832, Nov. 3, 1982, as amended at 58 FR 40324, July 28, 1993; 60 FR 20010, Apr. 24, 1995]
Title 12: Banks and Banking
PART 614—LOAN POLICIES AND OPERATIONS
Subpart M—Loan Approval Requirements
§ 614.4450 General requirements.
§ 614.4460 Loan approval responsibility.
§ 614.4470 Loans subject to bank approval.
