Legal Definitions - federal farm credit bank

Definition: The Federal Farm Credit Bank is a type of financial institution that is federally chartered and created to provide credit to farm-related enterprises. It is part of a system of banks that resulted from a merger of federal land banks and federal intermediate credit banks. These banks are supervised by the Farm Credit Administration.

Example: A farmer who needs to purchase new equipment for their farm may apply for a loan from a Federal Farm Credit Bank. The bank will review the farmer's financial history and creditworthiness before deciding whether to approve the loan.

Explanation: This example illustrates how a Federal Farm Credit Bank provides credit to farm-related enterprises, in this case, a farmer who needs to purchase equipment. The bank's role is to assess the borrower's creditworthiness and provide the necessary funds to support their business operations.