Federal Credit Reform Act of 1989

Federal Credit Reform Act of 1989 - Establishes procedures for the budgetary treatment and financing of Federal direct loan and loan guarantee programs.

Makes any direct loan obligation of a Federal agency an obligation of the Direct Loan Fund.

Requires each agency to include in its budget proposal for a fiscal year: (1) the planned level of new direct loan obligations and new loan guarantee commitments; and (2) the estimated subsidies associated with each. Prohibits an agency from making a direct loan obligation or loan guarantee commitment unless: (1) funds have been appropriated or are available on a permanent indefinite basis for the subsidy; or (2) the use of funds otherwise available to the agency for the subsidy has been limited.

Declares that the loan subsidy amount shall constitute an obligation of the agency and the difference between such amount and the face value of the loan shall constitute an obligation of the Direct Loan Fund. Requires the subsidy to be paid as the loan is disbursed.

Makes any loan guarantee commitment of a Federal agency a commitment of the Guaranteed Loan Fund. Requires the relevant subsidy to be paid to the Guaranteed Loan Fund when the underlying loan agreement is executed.

Establishes within the Department of the Treasury a Federal Credit Direct Loan Fund and a Federal Credit Guaranteed Loan Fund to serve as central revolving funds and financing mechanisms for all new Federal direct loans and loan guarantees respectively.

Requires the head of each agency authorized to make or guarantee loans to: (1) request annual appropriations for the subsidized portions of agency loans; (2) conduct loan programs within specified limitations; and (3) pay to the Funds all relevant loan collections.

Requires that for budgetary purposes direct loan and loan guarantee subsidies be treated as agency obligations and obligations for direct loans or for honoring loan guarantees as obligations of the relevant Fund.

Authorizes the Secretary to use the proceeds of the sale of any securities issued under the Second Liberty Bond Act to: (1) finance direct loans to the extent not covered by agency subsidy payments and direct loan sales; and (2) pay claims in excess of Guaranteed Loan Fund reserves.

Authorizes the appropriation of funds necessary to liquidate debt incurred by the Funds due to operating losses. Authorizes appropriations to agencies for subsidies associated with proposed direct loan obligations and loan guarantee commitments.

Includes as "deposit insurance agencies" the Federal Deposit Insurance Corporation, the Federal Savings and Loan Insurance Corporation, the National Credit Union Administration, the Pension Benefit Guaranty Corporation, and the Securities and Exchange Commission. Declares that obligations of deposit insurance agencies to make direct loans to the public and their commitments to guarantee loans shall remain obligations and commitments of the agencies. Requires each deposit insurance agency to include in its budget proposal the estimated subsidy costs associated with proposed direct loan obligations and loan guarantee commitments.