Farmer Mac Adds Net Interest Income


Farmer Mac earned $13.3 million for the fourth quarter and $13.8 million for the full year 2011, as the company saw increased net interest income and it was able to release funds from its allowances for loan losses.

For the same periods in 2010, it earned $12.5 million and $22.1 million respectively. The decline in earnings between FY 2011 and FY 2010 is due to a decrease in the fair value of financial derivatives on its balance sheet.

During 2011, Farmer Mac added $3.4 billion to the program, up from $3 billion one year prior. This consisted of $496 million of Farmer Mac I loans purchased; $472 million of Farmer Mac I added through long term standby purchase commitments; $1.8 billion of Farmer Mac I AgVantage securities purchased; $204 million of Rural Utilities program loans purchased; $3 million of Rural Utilities AgVantage securities guaranteed; and $408 million of Farmer Mac II USDA-guaranteed portions of loans purchased.

However principal pay downs, plus a $475 million AgVantage security maturation resulted in a $303 million decrease in outstanding program volume during 2011 to $12 billion at the end of last year.

There was an improvement in delinquencies as 90-day lates as of Dec. 31, 2011 were $40.6 million, down from $70.2 million on the same day in 2010. Furthermore at the end of 2011, zero ethanol loans were 90-days late, versus nearly $11 million one year prior.

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