The new legislation provided for 12 Federal Intermediate Credit Banks (FICBs) intended to finance short-term commercial loans and to make direct loans to cooperatives. The legislation also extended the Federal Land Bank System to Alaska and Puerto Rico. The same year, the Federal Farm Loan Board created a Fiscal Agency, to more effectively market the bonds which provided credit for the system.
After years as a part of the USDA’s comprehensive agricultural program, the Farm Credit Administration got independent regulator status, directed by the Federal Farm Credit Board (FFCB). Most FFCB members were chosen from within the System—they appointed the Governor of the Farm Credit Administration. The movement toward independence began in 1947 when the Federal Land Banks paid off the last of the federal capital provided during the Great Depression.
The Farm Crisis of the 1980s was created by changing external factors that led to overproduction, high interest rates and plunging land values. After 1985 legislation failed to enable the System to rescue stressed institutions, the 1987 Act abolished the Federal Farm Credit Board and created a new Farm Credit Administration board with enforcement powers. The 1987 Act provided financial assistance and directed mergers and other reorganizations to create a leaner, stronger System.