system supplying credit reserves for savings and loans, cooperative banks, and other mortgage lenders in a manner similar to the Federal Reserve's role with commercial banks. The Federal Home Loan Bank System is made up of 12 regional Federal Home Loan Banks. It raises money by issuing notes and bonds and lends money to savings and loans and other mortgage lenders based on the amount of collateral the institution can provide. The system was established in 1932 after a massive wave of bank failures. In 1989, Congress passed savings and loan bailout legislation revamping the regulatory structure of the industry. The Federal Home Loan Bank Board was dismantled and replaced with the Federal Housing Finance Board, which now oversees the home loan bank system. The financial services modernization act of 1999 expanded the collateral that member banks could use to obtain an advance. In addition to traditional mortgage loans, banks can now put up rural, agricultural, and small business loans.

system established by the Farm Credit Act of 1971 to provide credit services to farmers and farm-related enterprises through a network of 12 Farm Credit districts. Each district has a Federal Land Bank, a Federal Intermediate Credit Bank, and a Bank for Cooperatives to carry out policies of the system. The system sells short-term (5- to 270-day) notes in increments of $50,000 on a discounted basis through a national syndicate of securities dealers. Rates are set by the federal farm credit bank, a unit established to consolidate the financing activities of the various banks. An active secondary market is maintained by several dealers. The system also issues Federal Farm Credit System Consolidated Systemwide Bonds on a monthly basis with six- and nine-month maturities. The bonds are sold in increments of $5,000 with rates set by the system. The bonds enjoy a secondary market even more active than that for the discounted notes.