Farm Credit Discount Notes are high credit quality, short-term debt instruments. They are issued at a discount to their par amount, similar to U.S. Treasury bills. Discount Notes are generally issued each business day with maturities of one to 365 days. The range of maturity dates provides investors with the ability to match maturities to their anticipated cash flow needs and the discounted structure avoids income reinvestment risk normally associated with coupon bearing instruments.
Discount notes are issued in response to investor inquiry and the needs of the Farm Credit System Banks.