Federal Intermediate Credit Bank


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Federal Intermediate Credit Bank

A bank sponsored by the federal government to provide funds to institutions making loans to farmers.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Federal Intermediate Credit Bank

One of 12 government-sponsored banks that provide loans to farms, ranches, and other agricultural companies. These loans are short-term; farmers, ranchers and their companies own the stock in Federal Intermediate Credit Banks, much like member banks own stock in the Federal Reserve. The FICB derives most of its capital from short-term debt securities.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
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Those boards each govern three regional subsidiaries--the Banks for Cooperatives, as well as the Federal Land Banks and the Federal Intermediate Credit Banks, which oversee the Production Credit Associations (P.C.A.).
Farm Credit bailout; saving the system, not the farmers
Hoover described his hopes for the new GSE in his official signing statement: "[The RFC Act] brings into being a powerful organization with adequate resources, able to strengthen weaknesses that may develop in our credit, banking, and railway structure, in order to permit business and industry to carry on normal activities free from the fear of unexpected shocks and retarding influences." (131) In its final form, the act gave the RFC the authority to lend to a broad set of financial intermediaries, including government-sponsored enterprises like the Federal Land Banks and Federal Intermediate Credit Banks, as well as to railroads, on a wide range of collateral.
(58) By the time Herbert Hoover assumed the presidency in 1929, Congress had created three government-sponsored enterprises (GSEs) that either directly or indirectly targeted frictions in agricultural credit markets: (1) the Farm Land Banks, (2) the War Finance Corporation, and (3) the Federal Intermediate Credit Banks. The creation of these enterprises reflected the congressional view that perceived dysfunction in the credit markets warranted targeted government intervention.
THE POLITICAL ORIGINS OF SECTION 13(3) OF THE FEDERAL RESERVE ACT

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