[Code of Federal Regulations]

[Title 12, Volume 6]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 12CFR652.35]



[Page 315-318]

 

                       TITLE 12--BANKS AND BANKING

 

                 CHAPTER VI--FARM CREDIT ADMINISTRATION

 

PART 652_FEDERAL AGRICULTURAL MORTGAGE CORPORATION FUNDING AND FISCAL 

AFFAIRS--Table of Contents

 

                     Subpart A_Investment Management

 

Sec. 652.35  Eligible non-program investments.



    (a) You may hold only the types, quantities, and qualities of non-

program investments listed in the following Non-Program Investment 

Eligibility Criteria Table. These investments must be denominated in 

United States dollars.



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[GRAPHIC] [TIFF OMITTED] TR14JY05.000





[[Page 317]]





[GRAPHIC] [TIFF OMITTED] TR14JY05.001



    (b) Rating of foreign countries. Whenever the obligor or issuer of 

an eligible investment is located outside the United States, the host 

country must



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maintain the highest sovereign rating for political and economic 

stability by an NRSRO.

    (c) Marketable investments. All eligible investments, except money 

market instruments, must be readily marketable. An eligible investment 

is marketable if you can sell it promptly at a price that closely 

reflects its fair value in an active and universally recognized 

secondary market. You must evaluate and document the size and liquidity 

of the secondary market for the investment at time of purchase.

    (d) Obligor limits. (1) You may not invest more than 25 percent of 

your regulatory capital in eligible investments issued by any single 

entity, issuer or obligor. This obligor limit does not apply to 

Government-sponsored agencies or Government agencies. You may not invest 

more than 100 percent of your regulatory capital in any one Government-

sponsored agency. There are no obligor limits for Government agencies.

    (2) Obligor limits for your holdings in an investment company. You 

must count securities that you hold through an investment company 

towards the obligor limits of this section unless the investment 

company's holdings of the security of any one issuer do not exceed 5 

percent of the investment company's total portfolio.

    (e) Preferred stock and other investments approved by the FCA. (1) 

You may purchase non-program investments in preferred stock issued by 

other Farm Credit System institutions only with our written prior 

approval. You may also purchase non-program investments other than those 

listed in the Non-Program Investment Eligibility Criteria Table at 

paragraph (a) of this section only with our written prior approval.

    (2) Your request for our approval must explain the risk 

characteristics of the investment and your purpose and objectives for 

making the investment.