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FEDERAL RESERVE BANK OF DALLAS
F IS C A L A G E N T
C O M M O D IT Y C R E D IT C O R P O R A T IO N
S T A T IO N K. D A L L A S . T E X A S

December 4,1953

OFFERING TO COMMERCIAL BANKS OF

2 % PERCENT COMMODITY CREDIT CORPORATION CERTIFICATES OF INTEREST
To AH Banking Institutions in the
Eleventh Federal Reserve District:
An official announcement governing the offering to commercial banks (banks accepting demand
deposits) of $450,000,000 (or thereabouts) 2*4, percent Commodity Credit Corporation Certificates of
Interest is enclosed, together with an application form. Additional copies o f the announcement and
form will be forwarded upon request.
The certificates will be dated December 17, 1953, provided payment is made in available funds
on that date, and will mature on August 2, 1954. They will be purchased by the Commodity Credit
Corporation at any time prior to maturity upon demand and may be used as collateral for Treasury
Tax and Loan Accounts. Also, they are transferable by assignment to any commercial bank. Certificates
will be issued in multiples of $1,000, but no certificate will be issued for less than $5,000. The certificates
offered evidence participation in a new pool of outstanding price support cotton loans of the 1952 crop
and 1953 crop cotton loans to cooperative associations which have previously been held in separate pools.
In the interest of an equitable distribution of these certificates, banks are requested to limit their
applications to amounts not to exceed one-half of their present capital, surplus and undivided profits.
The books for receipt of subscriptions for this offering will be opened on Thursday, December 10,
1953, and wiU close at the close of business the same day. Applications, either on the official application
form or in letter form or by telegram postmarked or dispatched before midnight December 10, 1953,
and addressed to a Federal Reserve Bank or Branch, will be considered timely. Any commercial bank
may file applications for the certificates, and city banks may file applications for the account of country
bank correspondents.
Since it is necessary that each application be supported by an official application form, any
application not originally submitted on such form and any application filed for a bank by its city
correspondent must be promptly confirmed on an official application form, fully executed, by the appli­
cant. The original and duplicate copies of each form should be sent to this bank or appropriate branch.
The triplicate may be retained.
It is hoped that allotment notices can be mailed to applicants on Monday, December 14, and since
it is contemplated that payment will be made in available funds on Thursday, December 17, it may not
be possible to await correspondence with reference to the manner of payment of the certificates allotted.
Accordingly, member banks should authorize payment by charge to their reserve accounts on the official
application form, and it is suggested that nonmember banks request their correspondent member banks
to authorize the necessary charges to the members’ reserve accounts on December 17. All payments
will be handled by the office of this bank through which the application is entered. Payment for the
certificates by Treasury Tax and Loan Account Credit is not authorized.
The original certificates will, as provided in the official announcement, be held at the Federal
Reserve Bank of Chicago as Fiscal Agent for the Commodity Credit Corporation. An authenticated
copy of the original certificate will be mailed direct to each purchaser by that bank and, unless other­
wise specifically instructed, a single certificate will be issued to each applicant for an amount equal to
such applicant’s allotment.
As indicated in the official announcement, applications and payments for the certificates should
be submitted to this bank or the appropriate branch for transmission to the Federal Reserve Bank of
Chicago, through which the offering is made as Fiscal Agent and Custodian for the Commodity Credit
Corporation.
It is important that subscriptions be filed promptly since, as stated, the subscription books will
remain open only one day, Thursday, December 10, 1953.
Yours very truly,
W. D. GENTRY
First Vice President

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

CCC ANNOUNCEMENT CHF-2 DECEMBER 7,1953
OFFERING COMMERCIAL BANKS THE OPPORTUNITY TO FINANCE PRICE SUPPORT LOANS
ON COTTON WHICH WERE ORIGINALLY DISBURSED BY CCC OR PURCHASED
BY CCC FROM LENDING AGENCIES.
AMOUNT OF OFFERING $450,000,000 OR THEREABOUTS

SECTION I — OFFER OF PARTICIPATION
Commodity Credit Corporation (hereinafter called “ CCC” ) has consolidated in a new pool (here­
inafter referred to as the “ Pool” ) outstanding price support cotton loans of the 1952 crop and 1953
crop cotton loans to cooperative associations which have previously been held in separate pools. These
loans now total $472,000,000.
Certificates of Interest (hereinafter called “ Certificates” ) of approximately $18,000,000 are cur­
rently outstanding on these pooled loans. These outstanding Certificates may, at the Certificate holder’s
option, be sold to CCC or exchanged for Certificates issued upon the terms and conditions of Section II
of this Announcement, which Certificates shall respectively be in face amounts equal to the value of
the exchanged Certificates and shall bear the issue date and rate of interest shown on the exchanged
Certificates. Holders of such Certificates have been separately advised of this option. (This Announce­
ment will in no way affect the operation of pools of loans evidenced by 1953 Cotton Producer’s Note and
Loan Agreement (CCC Cotton Form A) since these loans are not included in the Pool with respect to
which Certificates will be issued pursuant to this Announcement.)
Commercial Banks, which for this purpose are defined as banks accepting demand deposits, (here­
inafter called “ Banks” ) may participate in the financing of price support cotton loans placed in the
Pool by making funds available to CCC at the Federal Reserve Bank of Chicago, Fiscal Agent for CCC,
(hereinafter called “ Custodian” ). Certificates in the amount of $450,000,000 or thereabouts, bearing
interest at the rate of 2*4 percent per annum, will be issued pursuant to this Announcement to the extent
of the available balance to evidence participation in the Pool. Certificates will mature on August 2, 1954,
but will be purchased by CCC prior to maturity upon demand. The terms and conditions upon which
Banks may participate in the Pool are set forth in Section II of this Announcement.
Banks which desire to participate in the financing of the Pool shall make application to the Federal
Reserve Bank or Branch of the district in which they are located. Applications may be made on forms
which will be available at any Federal Reserve Bank or Branch or by wire or mail. Applications should
be made for Certificates in multiples of $1,000 and for not less than $5,000.
Books for the receipt of applications will be opened for one day only, December 10, 1953. Applica­
tions addressed to any Federal Reserve Bank or Branch and postmarked prior to midnight December 10,
1953, will be considered in this offering of participation Certificates. CCC reserves the right to reject
any application, in whole or in part, or to allot less than the amount of Certificates applied for, and its
decision in these respects shall be final. Applicants will be informed of allotments as soon as possible
after closing of the books.
The purchase price of the Certificates will be 100 percent of the face amount thereof.
Payment for the Certificates allotted shall be made through the Federal Reserve Bank or Branch
where application was filed in funds available at the Federal Reserve Bank of Chicago on December 17,
1953, and Certificates will be issued as of that date. In the event the total amount available is not applied
for, the amount remaining will be announced and will be available to applicants in the order of receipt
of their applications by the Custodian.
To the Pool from time to time there will be added other price support cotton loans. A lending agency
which makes loan advances to cooperative associations on 1953 crop cotton pursuant to an agreement
with CCC will receive a Certificate equal to the amount of such loan advances bearing interest at the
rate prescribed in the agreement and the applicable loans will be placed in the Pool. Further offerings of
Certificates to the extent of the available balance in the Pool may be made by CCC.
SECTION II — TERMS AND CONDITIONS
Certificates evidencing participation in the Pool will be issued upon the following terms and con­
ditions :
1. The Federal Reserve Bank of Chicago, Fiscal Agent for CCC, (hereinafter called “ Custodian” )
will issue Certificates and act as Custodian of the Certificates for the holders thereof.
2. The aggregate value of all outstanding Certificates will not exceed the amount of the Pool. The
Custodian will retain the Certificates and will furnish each original holder with a copy thereof.

3. The Certificates will be issued as of the date on which funds therefor are credited by the Cus­
todian to the account of CCC except that (1) when a Certificate is issued in exchange for an outstanding
Certificate, it shall bear the issue date of the Certificate for which it was exchanged or (2) when a Cer­
tificate is issued to a lending agency in the amount of a 1953 crop cotton loan advance made by such
lending agency to a cooperative association pursuant to an agreement with CCC, it shall bear the date
on which the loan advance is made by payment of the draft for the advance. The face amount of the
Certificate, less principal payments thereon, will constitute the value of the Certificate. Interest at the
rate shown on the Certificate will be payable at the time and upon the amount of each principal payment
made upon the Certificate and will be computed on a 365-day basis from and including the date of the
Certificate to, but not including, the date of such payment.
4. The Certificate may be transferred to any commercial bank, Federal Reserve Bank or such other
banking institution as may be determined by CCC to be eligible, by execution of an Assignment of Cer­
tificate of Interest (Commodity Credit Corporation Form 320, hereinafter called “ Assignment” ). Trans­
fers will be recorded as of the date of receipt and acceptance of such Assignment by the Custodian or
as of the date of receipt by the Custodian of telegraphic advice of such Assignment if such advice is
promptly confirmed by the delivery to the Custodian of a duly executed Assignment. In the event of
announcement by CCC, as provided in paragraph 6 hereof, that Certificates will be purchased during a
designated month, Assignments and telegraphic advices received during the first ten calendar days of
that month will not be recorded prior to the expiration of such period.
5. CCC will, upon demand by the Certificate holder of record to the Custodian, purchase through
any Federal Reserve Bank or Branch any outstanding Certificate at any time by paying to the Certificate
holder of record the value thereof plus accrued interest. CCC will purchase at maturity all outstanding
Certificates.
6. CCC reserves the right to purchase at its option any outstanding Certificate, in whole or in part,
and will, in the event the value of the outstanding Certificates on the last day of any month prior to
maturity exceeds the unpaid principal of the loans comprising the Pool as determined by CCC during
that month, purchase outstanding Certificates, in whole or in part, in a total amount sufficient to reduce
the outstanding Certificates to the unpaid principal amount of the loans comprising the Pool. CCC will
pay for any Certificate purchased, in whole or in part, all or the respective part of the value of the
Certificate plus accrued interest on such amount. Any purchase by CCC of outstanding Certificates, in
whole or in part, except as provided in paragraph 5, will be made only during the first ten calendar days
of a month and CCC will announce by press release on the first business day of each month prior to
maturity whether any purchases of Certificates, in whole or in part, will be made during the month.
Payments for such purchases will be made during the first ten calendar days of such month to the
Certificate holders of record as of the last day of the preceding month.
7. No Member of, or Delegate to Congress, or any Resident Commissioner, will be admitted to any
share or part of this contract or to any benefit to arise therefrom except that this provision will not be
construed to extend to their interest in any incorporated company, if the contract be for the general
benefit of such company.
8. The applicant Bank warrants that it has not employed any person to solicit or secure this con­
tract upon any agreement for a commission, percentage, brokerage, or contingent fee and that no such
consideration or payment has been or will be made. Breach of this warranty will give CCC the right to
annul the contract, or at its discretion, to deduct from the contract consideration the amount of such
commission, percentage, brokerage, or contingent fees. This warranty will not apply to commissions
payable by the applicant Bank upon contracts secured or made through bona fide employees or bona fide
established commercial or selling agencies utilized by the applicant Bank for the purpose of securing
business.
SECTION III — PURPOSE AND FINANCIAL ORGANIZATION OF CCC
The Commodity Credit Corporation engages in buying, selling, lending, and other activities with
respect to agricultural commodities, their products, foods, feeds, and fibers for the purpose of stabilizing,
supporting, and protecting farm income and prices, assisting in the maintenance of balanced and ade­
quate supplies of such commodities; and facilitating their orderly distribution. The Corporation also
makes available materials and facilities required in connection with the production and marketing of
such commodities.
The Corporation is managed by a board of directors, subject to the general supervision and direc­
tion of the Secretary of Agriculture, who is, ex officio, a director and the chairman of the board. In
addition to the Secretary, the board consists of six members appointed by the President and confirmed
by the Senate. There is also a bipartisan advisory board of five members appointed by the President to
survey the general policies of the Corporation and advise the Secretary with respect thereto.
The Corporation has an authorized capital stock of $100 million, all of which is held by the United
States, and authority to borrow up to $6.75 billion. On September 30, 1953, outstanding commitments
against this authority amounted to $4.39 billion. CCC will at all times hold in reserve an amount of its
borrowing authority sufficient to cover outstanding Certificates.
J. J. SOMERS
Controller,
Commodity Credit Corporation

Form No. 90-3

Ref. No_______________

APPLICATION FORM AND PAYMENT LETTER

21
/4% CERTIFICATES OF INTEREST
OF THE COMMODITY CREDIT CORPORATION
Dated December 17,1953

Due August 2, 1954
Date________________________________________________

Application filed through the Federal Reserve Bank or Branch o f _____________________________________________________ _
(To be filed with Federal Reserve Bank or Branch of the District in which applicant is located.)

To

Federal Reserve Bank of Chicago
Fiscal Agent and Custodian of
Commodity Credit Corporation

Gentlemen:
Pursuant to the terms and conditions of the official Announcement CHF-2, dated December 7, 1953, of
the Commodity Credit Corporation the undersigned hereby applies for $_________________________ face amount of
the Certificates of Interest described therein.
(*® no,e b8low)
°
N OTE: Applications must bo in multiples of $ 1 ,0 00 except that no certificate will be
issued for less than $ 5 ,0 00 .

Payment for total amount allotted hereon to be made on or before December 17, 1953, as follows: (P ay­
ment by Treasury Tax and Loan credit not permitted.)
□

By Charge to our reserve account at the Federal Reserve Bank of_________________________________________________

□

By Check in immediately available funds.

□

By Charge to reserve account of_____________

{Main Office OR Branch where reserve account is carried)

________

____________

(Appropriate instructions to correspondent necessary)

Repayments at or before maturity as provided in the official Announcement are authorized to be made by
credit to our reserve account (in case of member banks) or by check (in case of nonmember banks).
Certificate to be inscribed and copy thereof mailed to: (Please type or print.)
Name of Bank_______________________________________________________________________________
Street Address________________________________________________________________________________
City or Town_________________________________________________________________________________
State___________________________________________________________________________________________

Official Signature

(A .B .A . No_________________ )
Original— To be forwarded to Federal Reserve Bank of Chicago by
Federal Reserve Bank or Branch receiving application.

For Use of Federal Reserve Bank of Chicago

Typed by----------------------

___________

Allotted $----------------

Checked by___________________

___________

Computed by------------

Date Shipped or Delivered

___________

Checked by______________

By------------------------------

___________

Date Payment Received.

Form No. 90-3

Ref. No______

APPLICATION FORM AND PAYMENT LETTER

2lA % CERTIFICATES OF INTEREST
OF THE COMMODITY CREDIT CORPORATION
Dated December 17, 1953

Due August 2, 1954
Date--------------------------------------------------

Application filed through the Federal Reserve Bank or Branch o f -------------------------------------------------------(To be filed with Federal Reserve Bank or Branch of the District in which applicant is located.)

To

Federal Reserve Bank of Chicago
Fiscal Agent and Custodian of
Commodity Credit Corporation

Gentlemen:
Pursuant to the terms and conditions of the official Announcement CHF-2, dated December 7, 1953, of
the Commodity Credit Corporation the undersigned hereby applies for $-------------------------- face amount of
<lee no,e belowi
the Certificates of Interest described therein.
NOTE: Applications must be in multiples of $ 1 ,0 00 except that no certificate will be
issued for less than $ 5 ,0 00 .

Payment for total amount allotted hereon to be made on or before December 17, 1953, as follows: (Pay­
ment by Treasury Tax and Loan credit not permitted.)
□

By Charge to our reserve account at the Federal Reserve Bank of__________________________________________________

□

By Check in immediately available funds.

□

By Charge to reserve account of_______________________________________________________________________________________

(Main Office OR Branch where reserve account is carried)

(Appropriate instructions to correspondent necessary)

Repayments at or before maturity as provided in the official Announcement are authorized to be made by
credit to our reserve account (in case of member banks) or by check (in case of nonmember banks).
Certificate to be inscribed and copy thereof mailed to: (Please type or print.)
Name of Bank_______________________________________________________________________________
Street Address________________________________________________________________________________
City or Town_________________________________________________________________________________
State___________________________________________________________________________________________

Official Signature

(A .B .A . No_________________ )
Duplicate— To be forwarded and retained by
Federal Reserve Bank receiving application.

For Use of Federal Reserve Bank

Allotted $___________________
Computed by---------------Checked by_________________
Date Payment Received___

Form No. 90-3

Ref. N o .--------------

APPLICATION FORM AND PAYMENT LETTER
2 14
/

% CERTIFICATES OF INTEREST

OF THE COMMODITY CREDIT CORPORATION
Dated December 17, 1953

Due August 2, 1954
Date________________________________________________

Application filed through the Federal Reserve Bank or Branch o f _____________________________________________________
(To be filed with Federal Reserve Bank or Branch of the District in which applicant is located.)

To

Federal Reserve Bank of Chicago
Fiscal Agent and Custodian of
Commodity Credit Corporation

Gentlemen:
Pursuant to the terms and conditions of the official Announcement CHF-2, dated December 7, 1953, of
the Commodity Credit Corporation the undersigned hereby applies for $_________________________ face amount of
•*** no,e below>
the Certificates of Interest described therein.
N OTE: Applications must be in multiples of $ 1 ,0 00 except that no certificate will be
issued for less than $5,000.

Payment for total amount allotted hereon to be made on or before December 17, 1953, as follows: (P ay­
ment by Treasury Tax and Loan credit not permitted.)
□

By Charge to our reserve account at the Federal Reserve Bank of_________________________________________________

□

By Check in immediately available funds.

□

By Charge to reserve account of___________________________________________________________________________ ___________

(Main Office OR Branch where reserve account is carried)

(Appropriate instructions to correspondent necessary)

Repayments at or before maturity as provided in the official Announcement are authorized to be made by
credit to our reserve account (in case of member banks) or by check (in case of nonmember banks).
Certificate to be inscribed and copy thereof mailed to: (Please type or print.)
Name of Bank____________________ __________________________________________________________
Street Address________________________________________________________________________________
City or Town_________________________________________________________________________________
Sta te.__________________________________________________________________________________________

Official Signature

(A .B .A . No_________________ )
Triplicate— To be retained by Purchaser.


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102