In accordance with section 2154a of this title, each production credit association shall provide, through its bylaws and subject to Farm Credit Administration regulations, for its capitalization and the manner in which its stock shall be issued, held, transferred, and retired and, except as provided in subsection (b) of this section, its earnings distributed.
At the end of each fiscal year, each production credit association shall apply the amount of the earnings of the association for the fiscal year in excess of the operating expenses of the association (including provision for valuation reserves against loan assets in accordance with generally accepted accounting principles)—
(1) first, to the restoration of the impairment (if any) of capital; and
(2) second, to the establishment and maintenance of the surplus accounts, the minimum aggregate amount of which shall be prescribed by the Farm Credit Bank.
When the bylaws of an association so provide and subject to the general directions of the Farm Credit Administration, available net earnings at the end of any fiscal year may be distributed on a patronage basis in stock, participation certificates, or in cash. Any part of the earnings of the fiscal year in excess of the operating expenses for such year held in the surplus account may be allocated to patrons on a patronage basis.
(Pub. L. 92–181, title II, §2.3, as added Pub. L. 100–233, title IV, §401, Jan. 6, 1988, 101 Stat. 1632; amended Pub. L. 102–552, title V, §501, Oct. 28, 1992, 106 Stat. 4129.)
Sections: Previous 2020 2021 2022 2023 2071 2072 2073 2074 2075 2076 2076a 2077 2091 2092 2093 Next
Last modified: October 26, 2015