The Farm Credit Administration confirmed August 24, 2026, as the effective date for a final rule removing 'Formally restructured loans (TDR)' from regulatory high-risk loan performance categories. The agency published the final rule in the Federal Register on July 24, 2026.

Farm Credit Administration regulations require System institutions to prepare financial statements in accordance with GAAP. The agency determined no additional amendments are needed for enhanced disclosure requirements because existing regulations already mandate GAAP-compliant reporting. The final rule includes minor technical and organizational revisions to ensure internal consistency within the regulation.

Timeline

The final rule was published in the Federal Register on July 24, 2026.

The rule removes 'Formally restructured loans (TDR),' also known as troubled debt restructurings, from regulatory high-risk loan performance categories on that same date.

Why It Matters

The removal of formally restructured loans from high-risk categories reflects an alignment between federal agricultural lending regulations and broader accounting standards. By eliminating the specific TDR category, the Farm Credit Administration brings its regulatory framework into consistency with the 2022 updates to generally accepted accounting principles that removed separate accounting guidance for these instruments.

This adjustment affects how System institutions report loan performance while maintaining existing disclosure obligations. Because current regulations already mandate GAAP-compliant financial reporting, the agency concluded that no further amendments were necessary to address enhanced disclosure requirements, allowing the change to proceed with only minor technical revisions to ensure internal regulatory consistency.