- Outstanding Business Volume of
$24.5 Billion -
WASHINGTON, Aug. 8, 2022 /PRNewswire/ -- The
Federal Agricultural Mortgage Corporation (Farmer Mac; NYSE: AGM
and AGM.A), the nation's secondary market provider that increases
the availability and affordability of credit for the benefit of
rural America, today announced its results for the fiscal quarter
ended June 30, 2022.
Second Quarter 2022 Highlights
- Added $1.9 billion of gross
business volume, resulting in net growth of $236.0 million
- Net interest income grew $14.3
million year-over-year to $69.4
million
- Net effective spread1 increased 8% from the
prior-year period to $60.9
million
- Net income attributable to common stockholders of $39.1 million compared to $25.4 million in second quarter 2021
- Core earnings1 grew 3% year-over-year to
$30.7 million, or $2.83 per diluted common share
- 90-day delinquencies were 0.08% across the entire $24.5 billion portfolio as of June 30, 2022
"Farmer Mac delivered another quarter of strong results,
generating record core earnings and demonstrating the consistency
of our fundamental business model as we continue to successfully
execute against our multi-year growth plan," said President &
Chief Executive Officer, Brad
Nordholm. "These results are again noteworthy given the
current economic and market backdrop, where inflationary pressures
have created heightened uncertainty across credit markets and high
volatility across a broad range of prices, including key
agricultural commodities. Our continued strong credit quality,
solid capital position, and growing execution capability has
enabled Farmer Mac to consistently deliver on our mission to bring
even greater efficiencies, and lower costs, in providing financing
to lenders for the benefit of their farm and ranch, agribusiness,
and rural infrastructure customers. We remain confident in our
ability to navigate the current environment and make the necessary
investments in our infrastructure to pursue strategic growth
opportunities."
_______________
1 Non-GAAP Measure
|
$ in thousands,
except per share amounts
|
Quarter
Ended
|
|
Jun. 30,
2022
|
Mar. 31,
2022
|
Jun. 30,
2021
|
Sequential
% Change
|
YoY
% Change
|
|
Net Change in
Business Volume
|
$235,981
|
$628,947
|
$334,630
|
N/A
|
N/A
|
|
Net Interest Income
(GAAP)
|
$69,402
|
$61,875
|
$55,129
|
12 %
|
26 %
|
|
Net Effective Spread
(Non-GAAP)
|
$60,946
|
$57,839
|
$56,551
|
5 %
|
8 %
|
|
Diluted EPS
(GAAP)
|
$3.60
|
$3.77
|
$2.35
|
(5) %
|
53 %
|
|
Core EPS
(Non-GAAP)
|
$2.83
|
$2.37
|
$2.77
|
19 %
|
2 %
|
Second Quarter 2022 Results
Spreads
Net interest income for second quarter 2022 was $69.4 million, a $14.3
million increase compared to $55.1
million in the prior-year period, primarily due to a
$7.8 million increase in the fair
value of designated financial derivatives, a $4.3 million increase from net new business
volume, and a $2.5 million decrease
in funding costs. Net interest yield was 1.09% in second quarter
2022 compared to 0.94% in the prior-year period.
Net effective spread, a non-GAAP measure, for second quarter
2022 was $60.9 million, a
$4.4 million increase from
$56.6 million in the prior-year
period. The $4.4 million
year-over-year increase in net effective spread was primarily due
to a $4.8 million increase from
net new business volume, a $0.9
million increase in net coupon yields related to the
acquisition of loan servicing rights, and a $0.4 million increase in cash-basis interest
income. These factors were partially offset by a $1.4 million increase in non-GAAP funding costs.
In percentage terms, net effective spread was 0.99% in second
quarter 2022, compared to 1.01% in the prior-year period.
Earnings
Farmer Mac's net income attributable to common stockholders for
second quarter 2022 was $39.1 million
($3.60 per diluted common share),
compared to $25.4 million
($2.35 per diluted common share) in
the prior-year period. The $13.7 million year-over-year increase in net
income attributable to common stockholders was due to a
$11.3 million after-tax increase in
net interest income, a $5.1 million
after-tax increase in the fair value of undesignated financial
derivatives, and an increase in our release of credit losses of
$0.4 million after tax. These factors
were partially offset by a $2.5
million after-tax increase in operating expenses and a
$0.9 million increase in preferred
stock dividends.
Farmer Mac enters into financial derivatives transactions to
hedge interest rate risks inherent in its business and carries its
financial derivatives at fair value in its consolidated financial
statements. The fair value fluctuations of these financial
derivatives are not expected to have a cumulative net impact on
Farmer Mac's financial condition or results of operations reported
with GAAP if the derivatives are held to maturity, as is expected.
Therefore, Farmer Mac uses core earnings, a non-GAAP measure that
excludes the effects of fair value fluctuations, as a useful
alternative measure to understand the business.
Farmer Mac's core earnings for second quarter 2022 were
$30.7 million ($2.83 per diluted common share), compared to
$30.0 million ($2.77 per diluted common share) in second quarter
2021. The $0.8 million year-over-year
increase in core earnings was due to a $3.5
million after-tax increase in net effective spread and an
increase in our release of credit losses of $0.4 million after tax. These factors were
partially offset by a $2.5 million
after-tax increase in operating expenses and a $0.9 million increase in preferred stock
dividends.
Business Volume
Farmer Mac's outstanding business volume was $24.5 billion as of June 30, 2022, a net
increase of $0.2 billion from
March 31, 2022 after taking into
account all new business, maturities, sales, and paydowns on
existing assets. The net increase was primarily attributable to net
increases of $193.0 million in the
Rural Infrastructure Finance line of business and $43.0 million in the Agricultural Finance line of
business.
The $16.4 million net increase in
Farm & Ranch during second quarter 2022 resulted from
$1.4 billion of new purchases,
commitments, and guarantees, mostly offset by $1.4 billion of scheduled maturities and
repayments. Farmer Mac purchased a total of $432.6 million in loans, which was primarily
driven by improved borrower economics as well as a competitive,
albeit an increasing interest rate environment resulting in demand
for intermediate and long-term financing solutions. The
$432.6 million in gross Farm &
Ranch loan purchases was partially offset by $153.8 million in scheduled maturities and
repayments.
Farmer Mac also purchased a total of $0.8
billion in Farm & Ranch AgVantage Securities during
second quarter 2022, which primarily reflected the refinancing of
maturing securities as well as financial counterparties seeking to
add longer term AgVantage securities to manage their
asset-liability maturity profile given recent increases in credit
spreads and interest rates. The $0.8
billion in gross purchases was more than offset by
$1.0 billion in scheduled maturities.
Approximately $0.3 billion of the
total $0.8 billion in gross purchases
reflected purchases that refinanced maturing AgVantage securities
and were issued at short-term tenors, which may create some
volatility in AgVantage volumes throughout the year.
The $26.6 million net increase in
Corporate AgFinance during second quarter 2022 resulted from
$107.9 million of new loan
purchases, which was offset by $81.4
million of scheduled maturities, repayments, and sales.
Farmer Mac purchased a total of $85.4
million in loans, which was offset by $44.3 million in scheduled maturities,
repayments, and sales. This net increase in loans was primarily due
to Farmer Mac's continued focus to support loans to larger and more
complex agribusinesses focused on food and fiber processing, and
other supply chain production.
The $165.6 million net increase in
Rural Utilities during second quarter 2022 resulted from
$326.9 million of new purchases,
commitments, and guarantees, which was partially offset by
$161.3 million of scheduled
maturities and repayments. Farmer Mac purchased a total of
$196.5 million in Rural Utilities
loans; electric distribution and generation and transmission
comprised $161.5 million and
telecommunication comprised $35.0
million, which was fueled by a competitive but increasing
interest rate environment resulting in demand for long-term
financing solutions for planned maintenance and capital
expenditures. The $196.5 million in
loan purchases was partially offset by $24.4
million in scheduled maturities and repayments.
The $27.4 million net increase in
Renewable Energy during second quarter 2022 primarily reflects
$35.3 million in loan purchases,
partially offset by $7.9 million in
repayments.
Credit
As of June 30, 2022, the total allowance for losses was
$14.8 million, compared to
$16.3 million as of March 31, 2022. The $1.5
million release from the total allowance for losses in
second quarter 2022 was comprised of a $1.2
million release from the Rural Infrastructure Finance
portfolio and a $0.3 million release
from the allowance for the Agricultural Finance portfolio. The
$1.2 million release from the
allowance for the Rural Infrastructure portfolio was primarily
attributable to updated credit loss model forecast assumptions and
improvements in risk ratings. The $0.3
million release from the allowance for the Agricultural
Finance mortgage loan portfolio was primarily due to a risk rating
upgrade on an AgVantage counterparty.
As of June 30, 2022, Farmer Mac's 90-day delinquencies were
$20.6 million (0.20% of the
Agricultural Finance Mortgage Loan portfolio), compared to
$63.1 million (0.70% of the
Agricultural Finance Mortgage Loan portfolio) as of June 30, 2021. Across all of Farmer Mac's lines
of business, 90-day delinquencies represented 0.08% of total
outstanding business volume as of June 30, 2022, compared to
0.28% as of June 30, 2021.
Capital
As of June 30, 2022, Farmer Mac's core capital level was
$1.3 billion, $506.3 million above the minimum capital level
required by the company's statutory charter. Farmer Mac's Tier 1
capital ratio was 14.7% as of June 30, 2022.
Earnings Conference Call Information
The conference call to discuss Farmer Mac's second quarter 2022
financial results will be held beginning at 4:30 p.m. eastern time on Monday, August 8,
2022, and can be accessed by telephone or live webcast as
follows:
Telephone (Domestic): (888) 346-2616
Telephone (International): (412) 902-4254
Webcast: https://www.farmermac.com/investors/events-presentations/
When dialing in to the call, please ask for the "Farmer Mac
Earnings Conference Call." The call can be heard live and will also
be available for replay on Farmer Mac's website for two weeks
following the conclusion of the call.
More complete information about Farmer Mac's performance for
second quarter 2022 is in Farmer Mac's Quarterly Report on Form
10-Q for the quarter ended June 30, 2022 filed today with the
SEC.
Use of Non-GAAP Measures
In the accompanying analysis of its financial information,
Farmer Mac uses the following non-GAAP measures: "core earnings,"
"core earnings per share," and "net effective spread." Farmer Mac
uses these non-GAAP measures to measure corporate economic
performance and develop financial plans because, in management's
view, they are useful alternative measures in understanding Farmer
Mac's economic performance, transaction economics, and business
trends. The non-GAAP financial measures that Farmer Mac uses may
not be comparable to similarly labeled non-GAAP financial measures
disclosed by other companies. Farmer Mac's disclosure of these
non-GAAP measures is intended to be supplemental in nature and is
not meant to be considered in isolation from, as a substitute for,
or as more important than, the related financial information
prepared in accordance with GAAP.
Core earnings and core earnings per share principally differ
from net income attributable to common stockholders and earnings
per common share, respectively, by excluding the effects of fair
value fluctuations. These fluctuations are not expected to have a
cumulative net impact on Farmer Mac's financial condition or
results of operations reported in accordance with GAAP if the
related financial instruments are held to maturity, as is
expected.
Core earnings and core earnings per share also differ from net
income attributable to common stockholders and earnings per common
share, respectively, by excluding specified infrequent or unusual
transactions that Farmer Mac believes are not indicative of future
operating results and that may not reflect the trends and economic
financial performance of Farmer Mac's core business. For example,
we have excluded from core earnings losses on retirement of
preferred stock and the re-measurement of the deferred tax
asset.
Farmer Mac uses net effective spread to measure the net spread
Farmer Mac earns between its interest-earning assets and the
related net funding costs of these assets. Net effective spread
differs from net interest income and net interest yield because it
excludes: (1) the amortization of premiums and discounts on assets
consolidated at fair value that are amortized as adjustments to
yield in interest income over the contractual or estimated
remaining lives of the underlying assets; (2) interest income and
interest expense related to consolidated trusts with beneficial
interests owned by third parties, which are presented on Farmer
Mac's consolidated balance sheets as "Loans held for investment in
consolidated trusts, at amortized cost"; and (3) the fair
value changes of financial derivatives and the corresponding assets
or liabilities designated in a fair value hedge accounting
relationship.
Net effective spread also principally differs from net interest
income and net interest yield because it includes:
(1) the accrual of income and expense related to the
contractual amounts due on financial derivatives that are not
designated in hedge accounting relationships ("undesignated
financial derivatives"); and (2) the net effects of terminations or
net settlements on financial derivatives. More information about
Farmer Mac's use of non-GAAP measures is available in "Management's
Discussion and Analysis of Financial Condition and Results of
Operations—Results of Operations" in Farmer Mac's Annual Report on
Form 10-K for the year ended December 31,
2021, filed February 28, 2022
with the SEC.
For a reconciliation of Farmer Mac's net income attributable to
common stockholders to core earnings and of earnings per common
share to core earnings per share, and net interest income and net
interest yield to net effective spread, see "Reconciliations"
below.
Forward-Looking Statements
Management's expectations for Farmer Mac's future necessarily
involve assumptions and estimates and the evaluation of risks and
uncertainties. Various factors or events, both known and unknown,
could cause Farmer Mac's actual results to differ materially from
the expectations as expressed or implied by the forward-looking
statements in this release, including uncertainties about:
- the availability to Farmer Mac of debt and equity financing
and, if available, the reasonableness of rates and terms;
- legislative or regulatory developments that could affect Farmer
Mac, its sources of business, or agricultural or rural
infrastructure industries;
- fluctuations in the fair value of assets held by Farmer Mac and
its subsidiaries;
- the level of lender interest in Farmer Mac's products and the
secondary market provided by Farmer Mac;
- the general rate of growth in agricultural mortgage and rural
utilities indebtedness;
- the effect of economic conditions and geopolitics on
agricultural mortgage or rural utilities lending, borrower
repayment capacity, or collateral values, including fluctuations in
interest rates, changes in U.S. trade policies, fluctuations in
export demand for U.S. agricultural products, supply chain
disruptions, increases in input costs, labor availability,
volatility in commodity prices, and the effects of the conflict
between Russia and Ukraine;
- the degree to which Farmer Mac is exposed to interest rate risk
resulting from fluctuations in Farmer Mac's borrowing costs
relative to market indexes;
- developments in the financial markets, including possible
investor, analyst, and rating agency reactions to events involving
government-sponsored enterprises, including Farmer Mac;
- the effects of the Federal Reserve's efforts to achieve
monetary policy normalization and slow inflation;
- other factors that could hinder agricultural mortgage lending
or borrower repayment capacity, including the effects of severe
weather and drought, climate change, or fluctuations in
agricultural real estate values; and
- the duration, mitigation efforts, spread, severity, and social
and economic disruption of the ongoing COVID-19 pandemic and its
effects on the business operations of agricultural and rural
borrowers, the capital markets, and Farmer Mac's business
operations.
Other risk factors are discussed in "Risk Factors" in Part I,
Item 1A in Farmer Mac's Annual Report on Form 10-K for the year
ended December 31, 2021, as filed
with the SEC on February 28, 2022.
Considering these potential risks and uncertainties, no undue
reliance should be placed on any forward-looking statements
expressed in this release. The forward-looking statements contained
in this release represent management's expectations as of the date
of this release. Farmer Mac undertakes no obligation to release
publicly the results of revisions to any forward-looking statements
included in this release to reflect new information or any future
events or circumstances, except as otherwise required by applicable
law. The information in this release is not necessarily indicative
of future results.
About Farmer Mac
Farmer Mac is a vital part of the agricultural credit markets
and was created to increase access to and reduce the cost of credit
for the benefit of American agricultural and rural communities. As
the nation's secondary market for agricultural credit, we provide
financial solutions to a broad spectrum of the agricultural
community, including agricultural lenders, agribusinesses, and
other institutions that can benefit from access to flexible,
low-cost financing and risk management tools. Farmer Mac's
customers benefit from our low cost of funds, low overhead costs,
and high operational efficiency. More information about Farmer Mac
(including the Annual Report on Form 10-K referenced above) is
available on Farmer Mac's website at www.farmermac.com.
* * * *
|
FEDERAL AGRICULTURAL
MORTGAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
(unaudited)
|
|
|
As of
|
|
June 30,
2022
|
|
December 31,
2021
|
|
(in
thousands)
|
|
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
909,430
|
|
$
908,785
|
|
Investment
securities:
|
|
|
|
|
Available-for-sale, at
fair value (amortized cost of $4,354,855 and $3,834,714,
respectively)
|
4,246,012
|
|
3,836,391
|
|
Held-to-maturity, at
amortized cost
|
45,032
|
|
44,970
|
|
Other
investments
|
1,537
|
|
1,229
|
|
Total Investment
Securities
|
4,292,581
|
|
3,882,590
|
|
Farmer Mac Guaranteed
Securities:
|
|
|
|
|
Available-for-sale, at
fair value (amortized cost of $6,679,196 and $6,135,807,
respectively)
|
6,450,212
|
|
6,328,559
|
|
Held-to-maturity, at
amortized cost
|
1,689,469
|
|
2,033,239
|
|
Total Farmer Mac
Guaranteed Securities
|
8,139,681
|
|
8,361,798
|
|
USDA
Securities:
|
|
|
|
|
Trading, at fair
value
|
2,275
|
|
4,401
|
|
Held-to-maturity, at
amortized cost
|
2,430,830
|
|
2,436,331
|
|
Total USDA
Securities
|
2,433,105
|
|
2,440,732
|
|
Loans:
|
|
|
|
|
Loans held for
investment, at amortized cost
|
8,911,475
|
|
8,314,096
|
|
Loans held for
investment in consolidated trusts, at amortized cost
|
834,941
|
|
948,623
|
|
Allowance for
losses
|
(12,403)
|
|
(14,041)
|
|
Total loans, net of
allowance
|
9,734,013
|
|
9,248,678
|
|
Financial derivatives,
at fair value
|
30,011
|
|
19,139
|
|
Interest receivable
(includes $7,664 and $10,418, respectively, related to consolidated
trusts)
|
177,956
|
|
177,355
|
|
Guarantee and
commitment fees receivable
|
44,388
|
|
45,538
|
|
Deferred tax asset,
net
|
25,971
|
|
15,558
|
|
Prepaid expenses and
other assets
|
129,267
|
|
45,318
|
|
Total
Assets
|
$
25,916,403
|
|
$
25,145,491
|
|
|
|
|
|
Liabilities and
Equity:
|
|
|
|
|
Liabilities:
|
|
|
|
|
Notes
payable
|
$
23,474,095
|
|
$
22,716,156
|
|
Debt securities of
consolidated trusts held by third parties
|
866,107
|
|
981,379
|
|
Financial derivatives,
at fair value
|
127,983
|
|
34,248
|
|
Accrued interest
payable (includes $6,753 and $9,619, respectively, related to
consolidated trusts)
|
93,823
|
|
83,992
|
|
Guarantee and
commitment obligation
|
42,990
|
|
43,926
|
|
Accounts payable and
accrued expenses
|
97,380
|
|
79,427
|
|
Reserve for
losses
|
1,677
|
|
1,950
|
|
Total
Liabilities
|
24,704,055
|
|
23,941,078
|
|
Commitments and
Contingencies
|
|
|
|
|
Equity:
|
|
|
|
|
Preferred
stock:
|
|
|
|
|
Series C, par value
$25 per share, 3,000,000 shares authorized, issued and
outstanding
|
73,382
|
|
73,382
|
|
Series D, par value
$25 per share, 4,000,000 shares authorized, issued and
outstanding
|
96,659
|
|
96,659
|
|
Series E, par value
$25 per share, 3,180,000 shares authorized, issued and
outstanding
|
77,003
|
|
77,003
|
|
Series F, par value
$25 per share, 4,800,000 shares authorized, issued and
outstanding
|
116,160
|
|
116,160
|
|
Series G, par value
$25 per share, 5,000,000 shares authorized, issued and
outstanding
|
121,327
|
|
121,327
|
|
Common
stock:
|
|
|
|
|
Class A Voting, $1 par
value, no maximum authorization, 1,030,780 shares
outstanding
|
1,031
|
|
1,031
|
|
Class B Voting, $1 par
value, no maximum authorization, 500,301 shares
outstanding
|
500
|
|
500
|
|
Class C Non-Voting, $1
par value, no maximum authorization, 9,265,842 shares and 9,235,205
shares outstanding, respectively
|
9,266
|
|
9,235
|
|
Additional paid-in
capital
|
127,569
|
|
125,993
|
|
Accumulated other
comprehensive (loss)/income, net of tax
|
(49,484)
|
|
3,853
|
|
Retained
earnings
|
638,935
|
|
579,270
|
|
Total
Equity
|
1,212,348
|
|
1,204,413
|
|
Total Liabilities and
Equity
|
$
25,916,403
|
|
$
25,145,491
|
|
FEDERAL AGRICULTURAL
MORTGAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
(unaudited)
|
|
|
For the Three Months
Ended
|
|
For the Six Months
Ended
|
|
June 30,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
|
(in thousands,
except per share amounts)
|
|
Interest
income:
|
|
|
|
|
|
|
|
|
Investments and cash
equivalents
|
$
11,200
|
|
$
4,457
|
|
$
16,916
|
|
$
9,986
|
|
Farmer Mac Guaranteed
Securities and USDA Securities
|
57,104
|
|
42,414
|
|
96,361
|
|
84,818
|
|
Loans
|
76,632
|
|
60,214
|
|
143,879
|
|
119,708
|
|
Total interest
income
|
144,936
|
|
107,085
|
|
257,156
|
|
214,512
|
|
Total interest
expense
|
75,534
|
|
51,956
|
|
125,879
|
|
106,132
|
|
Net interest
income
|
69,402
|
|
55,129
|
|
131,277
|
|
108,380
|
|
Release of/(provision
for) losses
|
1,372
|
|
761
|
|
1,316
|
|
(152)
|
|
Net interest income
after release of/(provision for) losses
|
70,774
|
|
55,890
|
|
132,593
|
|
108,228
|
|
Non-interest
income/(expense):
|
|
|
|
|
|
|
|
|
Guarantee and
commitment fees
|
3,213
|
|
2,997
|
|
6,908
|
|
6,027
|
|
Gains/(losses) on
financial derivatives
|
3,418
|
|
(3,066)
|
|
19,492
|
|
1,227
|
|
Gains/(losses) on
trading securities
|
29
|
|
(62)
|
|
(34)
|
|
(75)
|
|
Release of reserve for
losses
|
163
|
|
222
|
|
273
|
|
1,166
|
|
Other
income
|
479
|
|
435
|
|
1,154
|
|
1,018
|
|
Non-interest
income
|
7,302
|
|
526
|
|
27,793
|
|
9,363
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Compensation and
employee benefits
|
11,715
|
|
9,779
|
|
25,013
|
|
21,574
|
|
General and
administrative
|
7,520
|
|
6,349
|
|
14,798
|
|
12,685
|
|
Regulatory
fees
|
813
|
|
750
|
|
1,625
|
|
1,500
|
|
Operating
expenses
|
20,048
|
|
16,878
|
|
41,436
|
|
35,759
|
|
Income before income
taxes
|
58,028
|
|
39,538
|
|
118,950
|
|
81,832
|
|
Income tax
expense
|
12,132
|
|
8,252
|
|
25,217
|
|
17,319
|
|
Net income
|
45,896
|
|
31,286
|
|
93,733
|
|
64,513
|
|
Preferred stock
dividends
|
(6,792)
|
|
(5,842)
|
|
(13,583)
|
|
(11,111)
|
|
Net income
attributable to common stockholders
|
$
39,104
|
|
$
25,444
|
|
$
80,150
|
|
$
53,402
|
|
|
|
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
|
|
|
|
|
Basic earnings per
common share
|
$
3.62
|
|
$
2.36
|
|
$
7.43
|
|
$
4.96
|
|
Diluted earnings per
common share
|
$
3.60
|
|
$
2.35
|
|
$
7.37
|
|
$
4.93
|
Reconciliations
Reconciliations of Farmer Mac's net income attributable to
common stockholders to core earnings and core earnings per share
are presented in the following tables along with information about
the composition of core earnings for the periods
indicated:
|
Reconciliation of Net
Income Attributable to Common Stockholders to Core
Earnings
|
|
For the Three Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
(in thousands, except per share amounts)
|
|
Net income attributable
to common stockholders
|
$
39,104
|
|
$
41,046
|
|
$
25,444
|
|
Less reconciling
items:
|
|
|
|
|
|
|
Gains/(losses) on
undesignated financial derivatives due to fair value
changes
|
2,473
|
|
1,698
|
|
(3,721)
|
|
Gains/(losses) on
hedging activities due to fair value changes
|
5,916
|
|
2,024
|
|
(2,097)
|
|
Unrealized
(losses)/gains on trading assets
|
(285)
|
|
94
|
|
(61)
|
|
Net effects of
amortization of premiums/discounts and deferred gains on assets
consolidated at fair value
|
(62)
|
|
20
|
|
20
|
|
Net effects of
terminations or net settlements on financial derivatives
|
2,536
|
|
15,512
|
|
109
|
|
Income tax effect
related to reconciling items
|
(2,222)
|
|
(4,063)
|
|
1,208
|
|
Sub-total
|
8,356
|
|
15,285
|
|
(4,542)
|
|
Core
earnings
|
$
30,748
|
|
$
25,761
|
|
$
29,986
|
|
|
|
|
|
|
|
Composition of Core
Earnings:
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
Net effective
spread(1)
|
$
60,946
|
|
$
57,839
|
|
$
56,551
|
|
Guarantee and
commitment fees(2)
|
4,709
|
|
4,557
|
|
4,334
|
|
Other(3)
|
307
|
|
514
|
|
301
|
|
Total
revenues
|
65,962
|
|
62,910
|
|
61,186
|
|
|
|
|
|
|
|
Credit related expense
(GAAP):
|
|
|
|
|
|
|
Release of
losses
|
(1,535)
|
|
(54)
|
|
(983)
|
|
Total credit related
expense
|
(1,535)
|
|
(54)
|
|
(983)
|
|
|
|
|
|
|
|
Operating expenses
(GAAP):
|
|
|
|
|
|
|
Compensation and
employee benefits
|
11,715
|
|
13,298
|
|
9,779
|
|
General and
administrative
|
7,520
|
|
7,278
|
|
6,349
|
|
Regulatory
fees
|
813
|
|
812
|
|
750
|
|
Total operating
expenses
|
20,048
|
|
21,388
|
|
16,878
|
|
|
|
|
|
|
|
Net
earnings
|
47,449
|
|
41,576
|
|
45,291
|
|
Income tax
expense(4)
|
9,909
|
|
9,024
|
|
9,463
|
|
Preferred stock
dividends (GAAP)
|
6,792
|
|
6,791
|
|
5,842
|
|
Core
earnings
|
$
30,748
|
|
$
25,761
|
|
$
29,986
|
|
|
|
|
|
|
|
Core earnings per
share:
|
|
|
|
|
|
|
Basic
|
$
2.85
|
|
$
2.39
|
|
$
2.79
|
|
Diluted
|
$
2.83
|
|
$
2.37
|
|
$
2.77
|
|
|
(1) Net
effective spread is a non-GAAP measure. See "Use of Non-GAAP
Measures" above for an explanation of net effective spread.
See below for a reconciliation of net interest income to net
effective spread.
|
|
(2) Includes
interest income and interest expense related to consolidated trusts
owned by third parties reclassified from net interest income to
guarantee and commitment fees to reflect management's view that the
net interest income Farmer Mac earns is effectively a guarantee fee
on the consolidated Farmer Mac Guaranteed
Securities.
|
|
(3) Reflects
reconciling adjustments for the reclassification to exclude
expenses related to interest rate swaps not designated as hedges
and terminations or net settlements on financial derivatives, and
reconciling adjustments to exclude fair value adjustments on
financial derivatives and trading assets and the recognition of
deferred gains over the estimated lives of certain Farmer Mac
Guaranteed Securities and USDA Securities.
|
|
(4) Includes
the tax impact of non-GAAP reconciling items between net income
attributable to common stockholders and core
earnings.
|
|
Reconciliation of Net
Income Attributable to Common Stockholders to Core
Earnings
|
|
For the Six Months
Ended
|
|
June 30,
2022
|
|
June 30,
2021
|
|
(in thousands, except per share amounts)
|
|
Net income attributable
to common stockholders
|
$
80,150
|
|
$
53,402
|
|
Less reconciling
items:
|
|
|
|
|
Gains/(losses) on
undesignated financial derivatives due to fair value
changes
|
4,171
|
|
(2,026)
|
|
Gains/(losses) on
hedging activities due to fair value changes
|
7,940
|
|
(2,368)
|
|
Unrealized losses on
trading assets
|
(191)
|
|
(75)
|
|
Net effects of
amortization of premiums/discounts and deferred gains on assets
consolidated at fair value
|
(42)
|
|
36
|
|
Net effects of
terminations or net settlements on financial derivatives
|
18,048
|
|
1,274
|
|
Income tax effect
related to reconciling items
|
(6,285)
|
|
664
|
|
Sub-total
|
23,641
|
|
(2,495)
|
|
Core
earnings
|
$
56,509
|
|
$
55,897
|
|
|
|
|
|
Composition of Core
Earnings:
|
|
|
|
|
Revenues:
|
|
|
|
|
Net effective
spread(1)
|
$
118,785
|
|
$
110,410
|
|
Guarantee and
commitment fees(2)
|
9,266
|
|
8,574
|
|
Other(3)
|
821
|
|
752
|
|
Total
revenues
|
128,872
|
|
119,736
|
|
|
|
|
|
Credit related expense
(GAAP):
|
|
|
|
|
Release of
losses
|
(1,589)
|
|
(1,014)
|
|
Total credit related
expense
|
(1,589)
|
|
(1,014)
|
|
|
|
|
|
Operating expenses
(GAAP):
|
|
|
|
|
Compensation and
employee benefits
|
25,013
|
|
21,574
|
|
General and
administrative
|
14,798
|
|
12,685
|
|
Regulatory
fees
|
1,625
|
|
1,500
|
|
Total operating
expenses
|
41,436
|
|
35,759
|
|
|
|
|
|
Net
earnings
|
89,025
|
|
84,991
|
|
Income tax
expense(4)
|
18,933
|
|
17,983
|
|
Preferred stock
dividends (GAAP)
|
13,583
|
|
11,111
|
|
Core
earnings
|
$
56,509
|
|
$
55,897
|
|
|
|
|
|
Core earnings per
share:
|
|
|
|
|
Basic
|
$
5.24
|
|
$
5.20
|
|
Diluted
|
$
5.20
|
|
$
5.16
|
|
|
(1) Net
effective spread is a non-GAAP measure. See "Use of Non-GAAP
Measures" above for an explanation of net effective spread.
See below for a reconciliation of net interest income to net
effective spread.
|
|
(2) Includes
interest income and interest expense related to consolidated trusts
owned by third parties reclassified from net interest income to
guarantee and commitment fees to reflect management's view that the
net interest income Farmer Mac earns is effectively a guarantee fee
on the consolidated Farmer Mac Guaranteed
Securities.
|
|
(3) Reflects
reconciling adjustments for the reclassification to exclude
expenses related to interest rate swaps not designated as hedges
and terminations or net settlements on financial derivatives, and
reconciling adjustments to exclude fair value adjustments on
financial derivatives and trading assets and the recognition of
deferred gains over the estimated lives of certain Farmer Mac
Guaranteed Securities and USDA Securities.
|
|
(4) Includes
the tax impact of non-GAAP reconciling items between net income
attributable to common stockholders and core
earnings.
|
|
Reconciliation of
GAAP Basic Earnings Per Share to Core Earnings Basic Earnings Per
Share
|
|
For the Three Months
Ended
|
|
For the Six Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
|
(in thousands,
except per share amounts)
|
|
GAAP - Basic
EPS
|
$
3.62
|
|
$
3.81
|
|
$
2.36
|
|
$
7.43
|
|
$
4.96
|
|
Less reconciling
items:
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on
undesignated financial derivatives due to fair value
changes
|
0.23
|
|
0.16
|
|
(0.35)
|
|
0.39
|
|
(0.19)
|
|
Gains/(losses) on
hedging activities due to fair value changes
|
0.55
|
|
0.19
|
|
(0.19)
|
|
0.74
|
|
(0.22)
|
|
Unrealized
(losses)/gains on trading securities
|
(0.03)
|
|
0.01
|
|
(0.01)
|
|
(0.02)
|
|
(0.01)
|
|
Net effects of
amortization of premiums/discounts and deferred gains on assets
consolidated at fair value
|
(0.01)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Net effects of
terminations or net settlements on financial derivatives
|
0.24
|
|
1.44
|
|
0.01
|
|
1.67
|
|
0.12
|
|
Income tax effect
related to reconciling items
|
(0.21)
|
|
(0.38)
|
|
0.11
|
|
(0.59)
|
|
0.06
|
|
Sub-total
|
0.77
|
|
1.42
|
|
(0.43)
|
|
2.19
|
|
(0.24)
|
|
Core Earnings - Basic
EPS
|
$
2.85
|
|
$
2.39
|
|
$
2.79
|
|
$
5.24
|
|
$
5.20
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in per
share calculation (GAAP and Core Earnings)
|
10,796
|
|
10,767
|
|
10,763
|
|
10,782
|
|
10,751
|
|
|
|
Reconciliation of
GAAP Diluted Earnings Per Share to Core Earnings Diluted Earnings
Per Share
|
|
For the Three Months
Ended
|
|
For the Six Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
|
(in thousands,
except per share amounts)
|
|
GAAP - Diluted
EPS
|
$
3.60
|
|
$
3.77
|
|
$
2.35
|
|
$
7.37
|
|
$
4.93
|
|
Less reconciling
items:
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on
undesignated financial derivatives due to fair value
changes
|
0.23
|
|
0.16
|
|
(0.34)
|
|
0.38
|
|
(0.18)
|
|
Gains/(losses) on
hedging activities due to fair value changes
|
0.55
|
|
0.19
|
|
(0.19)
|
|
0.73
|
|
(0.22)
|
|
Unrealized
(losses)/gains on trading securities
|
(0.03)
|
|
0.01
|
|
(0.01)
|
|
(0.02)
|
|
(0.01)
|
|
Net effects of
amortization of premiums/discounts and deferred gains on assets
consolidated at fair value
|
(0.01)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Net effects of
terminations or net settlements on financial derivatives
|
0.23
|
|
1.42
|
|
0.01
|
|
1.66
|
|
0.12
|
|
Income tax effect
related to reconciling items
|
(0.20)
|
|
(0.38)
|
|
0.11
|
|
(0.58)
|
|
0.06
|
|
Sub-total
|
0.77
|
|
1.40
|
|
(0.42)
|
|
2.17
|
|
(0.23)
|
|
Core Earnings - Diluted
EPS
|
$
2.83
|
|
$
2.37
|
|
$
2.77
|
|
$
5.20
|
|
$
5.16
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in per
share calculation (GAAP and Core Earnings)
|
10,864
|
|
10,887
|
|
10,838
|
|
10,876
|
|
10,829
|
The following table presents a reconciliation of net interest
income and net yield to net effective spread for the periods
indicated:
|
Reconciliation of
GAAP Net Interest Income/Yield to Net Effective Spread
|
|
For the Three Months
Ended
|
|
For the Six Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
(dollars in
thousands)
|
|
Net interest
income/yield
|
$
69,402
|
|
1.09 %
|
|
$
61,875
|
|
1.00 %
|
|
$
55,129
|
|
0.94 %
|
|
$
131,277
|
|
1.04 %
|
|
$
108,380
|
|
0.93 %
|
|
Net effects of
consolidated trusts
|
(1,183)
|
|
0.02 %
|
|
(1,018)
|
|
0.02 %
|
|
(1,337)
|
|
0.02 %
|
|
(2,201)
|
|
0.02 %
|
|
(2,547)
|
|
0.02 %
|
|
Expense related to
undesignated financial derivatives
|
(2,026)
|
|
(0.03) %
|
|
(994)
|
|
(0.02) %
|
|
970
|
|
0.02 %
|
|
(3,020)
|
|
(0.02) %
|
|
3,038
|
|
0.03 %
|
|
Amortization of
premiums/discounts on assets consolidated at fair value
|
65
|
|
— %
|
|
(16)
|
|
— %
|
|
(13)
|
|
— %
|
|
49
|
|
— %
|
|
(20)
|
|
— %
|
|
Amortization of losses
due to terminations or net settlements on financial
derivatives
|
725
|
|
0.01 %
|
|
356
|
|
0.01 %
|
|
77
|
|
— %
|
|
1,083
|
|
0.01 %
|
|
180
|
|
— %
|
|
Fair value changes on
fair value hedge relationships
|
(6,037)
|
|
(0.10) %
|
|
(2,364)
|
|
(0.04) %
|
|
1,725
|
|
0.03 %
|
|
(8,403)
|
|
(0.07) %
|
|
1,379
|
|
0.01 %
|
|
Net effective
spread
|
$
60,946
|
|
0.99 %
|
|
$
57,839
|
|
0.97 %
|
|
$
56,551
|
|
1.01 %
|
|
$
118,785
|
|
0.98 %
|
|
$
110,410
|
|
0.99 %
|
The following table presents core earnings for Farmer Mac's
reportable operating segments and a reconciliation to consolidated
net income for the three months ended June 30, 2022:
|
Core Earnings by
Business Segment
|
|
For the Three Months
Ended June 30, 2022
|
|
Agricultural
Finance
|
|
Rural
Infrastructure
|
|
Treasury
|
|
Corporate
|
|
|
|
|
|
Farm &
Ranch
|
|
Corporate
AgFinance
|
|
Rural
Utilities
|
|
Renewable
Energy
|
|
Funding
|
|
Investments
|
|
|
Reconciling
Adjustments
|
|
Consolidated
Net Income
|
|
(in
thousands)
|
|
Net interest
income
|
$ 33,670
|
|
$ 6,929
|
|
$ 3,772
|
|
$
468
|
|
$
25,845
|
|
$ (1,282)
|
|
$
—
|
|
$
—
|
|
$
69,402
|
|
Less: reconciling
adjustments(1)(2)(3)
|
(1,080)
|
|
—
|
|
(39)
|
|
—
|
|
(7,337)
|
|
—
|
|
—
|
|
8,456
|
|
—
|
|
Net effective
spread
|
32,590
|
|
6,929
|
|
3,733
|
|
468
|
|
18,508
|
|
(1,282)
|
|
—
|
|
8,456
|
|
—
|
|
Guarantee and
commitment fees
|
4,338
|
|
43
|
|
308
|
|
20
|
|
—
|
|
—
|
|
—
|
|
(1,496)
|
|
3,213
|
|
Other
income/(expense)(3)
|
161
|
|
143
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3
|
|
3,619
|
|
3,926
|
|
Total
revenues
|
37,089
|
|
7,115
|
|
4,041
|
|
488
|
|
18,508
|
|
(1,282)
|
|
3
|
|
10,579
|
|
76,541
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Release of/(provision
for) losses
|
857
|
|
(650)
|
|
1,172
|
|
(8)
|
|
—
|
|
1
|
|
—
|
|
—
|
|
1,372
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Release of reserve for
losses
|
111
|
|
—
|
|
52
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
163
|
|
Operating
expenses
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(20,048)
|
|
—
|
|
(20,048)
|
|
Total non-interest
expense
|
111
|
|
—
|
|
52
|
|
—
|
|
—
|
|
—
|
|
(20,048)
|
|
—
|
|
(19,885)
|
|
Core earnings before
income taxes
|
38,057
|
|
6,465
|
|
5,265
|
|
480
|
|
18,508
|
|
(1,281)
|
|
(20,045)
|
|
10,579
|
(4)
|
58,028
|
|
Income tax
(expense)/benefit
|
(7,991)
|
|
(1,357)
|
|
(1,105)
|
|
(101)
|
|
(3,887)
|
|
269
|
|
4,263
|
|
(2,223)
|
|
(12,132)
|
|
Core earnings before
preferred stock dividends
|
30,066
|
|
5,108
|
|
4,160
|
|
379
|
|
14,621
|
|
(1,012)
|
|
(15,782)
|
|
8,356
|
(4)
|
45,896
|
|
Preferred stock
dividends
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(6,792)
|
|
—
|
|
(6,792)
|
|
Segment core
earnings/(losses)
|
$ 30,066
|
|
$ 5,108
|
|
$ 4,160
|
|
$
379
|
|
$
14,621
|
|
$ (1,012)
|
|
$
(22,574)
|
|
$
8,356
|
(4)
|
$
39,104
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
$
13,686,589
|
|
$
1,521,102
|
|
$
5,632,551
|
|
$
126,513
|
|
$
—
|
|
$ 4,802,159
|
|
$ 147,489
|
|
$
—
|
|
25,916,403
|
|
Total on- and
off-balance sheet program assets at principal balance
|
$
16,591,999
|
|
$
1,567,311
|
|
$
6,172,063
|
|
$
148,018
|
|
$
—
|
|
$
—
|
|
$
—
|
|
$
—
|
|
24,479,391
|
|
|
(1) Includes
the amortization of premiums and discounts on assets consolidated
at fair value, originally included in interest income, to reflect
core earnings amounts.
|
|
(2) Includes
the reclassification of interest income and interest expense from
consolidated trusts owned by third parties to guarantee and
commitment fees, to reflect management's view that the net interest
income Farmer Mac earns is effectively a guarantee
fee.
|
|
(3) Includes
the reclassification of interest expense related to interest rate
swaps not designated as hedges, which are included in
"Gains/(losses) on financial derivatives" on the consolidated
financial statements, to determine the effective funding cost for
each operating segment.
|
|
(4) Net
adjustments to reconcile to the corresponding income measures: core
earnings before income taxes reconciled to income before income
taxes; core earnings before preferred stock dividends reconciled to
net income; and segment core earnings reconciled to net income
attributable to common stockholders.
|
Supplemental Information
The following table sets forth information about outstanding
volume in each of Farmer Mac's lines of business as of the dates
indicated:
|
Outstanding Business
Volume
|
|
|
On or Off
Balance
Sheet
|
|
As of June 30,
2022
|
|
As of December 31,
2021
|
|
|
|
|
(in thousands)
|
|
Agricultural
Finance:
|
|
|
|
|
|
|
|
Farm &
Ranch:
|
|
|
|
|
|
|
|
Loans
|
|
On-balance
sheet
|
|
$
5,214,307
|
|
$
4,775,070
|
|
Loans held in
consolidated trusts:
|
|
|
|
|
|
|
|
Beneficial interests
owned by third-party investors
|
|
On-balance
sheet
|
|
834,941
|
|
948,623
|
|
IO-FMGS(1)
|
|
On-balance
sheet
|
|
11,561
|
|
12,297
|
|
USDA
Securities
|
|
On-balance
sheet
|
|
2,429,407
|
|
2,445,806
|
|
AgVantage
Securities
|
|
On-balance
sheet
|
|
4,995,000
|
|
4,725,000
|
|
LTSPCs and unfunded
commitments
|
|
Off-balance
sheet
|
|
2,562,467
|
|
2,587,154
|
|
Farmer Mac Guaranteed
Securities
|
|
Off-balance
sheet
|
|
523,580
|
|
578,358
|
|
Loans serviced for
others
|
|
Off-balance
sheet
|
|
20,736
|
|
22,331
|
|
Total Farm &
Ranch
|
|
|
|
$
16,591,999
|
|
$
16,094,639
|
|
Corporate
AgFinance:
|
|
|
|
|
|
|
|
Loans
|
|
On-balance
sheet
|
|
$
1,149,614
|
|
$
1,123,300
|
|
AgVantage
Securities
|
|
On-balance
sheet
|
|
352,968
|
|
367,464
|
|
Unfunded Loan
Commitments
|
|
Off-balance
sheet
|
|
64,729
|
|
47,070
|
|
Total Corporate
AgFinance
|
|
|
|
$
1,567,311
|
|
$
1,537,834
|
|
Total Agricultural
Finance
|
|
|
|
$
18,159,310
|
|
$
17,632,473
|
|
Rural Infrastructure
Finance:
|
|
|
|
|
|
|
|
Rural
Utilities:
|
|
|
|
|
|
|
|
Loans
|
|
On-balance
sheet
|
|
$
2,631,694
|
|
$
2,302,373
|
|
AgVantage
Securities
|
|
On-balance
sheet
|
|
2,986,404
|
|
3,033,262
|
|
LTSPCs and Unfunded
Loan Commitments
|
|
Off-balance
sheet
|
|
551,210
|
|
556,837
|
|
Farmer Mac Guaranteed
Securities
|
|
Off-balance
sheet
|
|
2,755
|
|
2,755
|
|
Total Rural
Utilities
|
|
|
|
$
6,172,063
|
|
$
5,895,227
|
|
Renewable
Energy:
|
|
|
|
|
|
|
|
Loans
|
|
On-balance
sheet
|
|
$
126,299
|
|
$
86,763
|
|
Unfunded Loan
Commitments
|
|
Off-balance
sheet
|
|
21,719
|
|
—
|
|
Total Renewable
Energy
|
|
|
|
$
148,018
|
|
$
86,763
|
|
Total Rural
Infrastructure Finance
|
|
|
|
$
6,320,081
|
|
$
5,981,990
|
|
Total
|
|
|
|
$
24,479,391
|
|
$
23,614,463
|
|
|
(1) An
interest-only Farmer Mac Guaranteed Security retained as part of a
structured securitization.
|
The following table presents the quarterly net effective spread
(a non-GAAP measure) by segment:
|
Net Effective
Spread(1)
|
|
Agricultural
Finance
|
|
Rural Infrastructure
Finance
|
|
Treasury
|
|
|
|
|
|
Farm &
Ranch
|
|
Corporate
AgFinance
|
|
Rural
Utilities
|
|
Renewable
Energy
|
|
Funding
|
|
Investments
|
|
Net Effective
Spread
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
Dollars
|
|
Yield
|
|
(dollars in
thousands)
|
|
For the quarter
ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2022(1)
|
$
32,590
|
|
1.05 %
|
|
$ 6,929
|
|
1.87 %
|
|
$ 3,733
|
|
0.27 %
|
|
$
468
|
|
1.78 %
|
|
$
18,508
|
|
0.30 %
|
|
$
(1,282)
|
|
(0.10) %
|
|
$
60,946
|
|
0.99 %
|
|
March 31,
2022
|
30,354
|
|
1.02 %
|
|
7,209
|
|
1.96 %
|
|
3,159
|
|
0.23 %
|
|
375
|
|
1.69 %
|
|
16,738
|
|
0.28 %
|
|
4
|
|
— %
|
|
57,839
|
|
0.97 %
|
|
December 31,
2021
|
28,998
|
|
0.99 %
|
|
6,321
|
|
1.84 %
|
|
2,521
|
|
0.19 %
|
|
356
|
|
1.53 %
|
|
15,979
|
|
0.28 %
|
|
158
|
|
0.01 %
|
|
54,333
|
|
0.94 %
|
|
September 30,
2021
|
28,914
|
|
1.06 %
|
|
7,163
|
|
1.80 %
|
|
2,067
|
|
0.16 %
|
|
236
|
|
1.09 %
|
|
17,386
|
|
0.31 %
|
|
159
|
|
0.01 %
|
|
55,925
|
|
0.99 %
|
|
June 30,
2021
|
29,163
|
|
1.06 %
|
|
6,676
|
|
1.65 %
|
|
1,759
|
|
0.14 %
|
|
378
|
|
1.80 %
|
|
18,449
|
|
0.33 %
|
|
126
|
|
0.01 %
|
|
56,551
|
|
1.01 %
|
|
March 31,
2021
|
26,461
|
|
0.98 %
|
|
6,921
|
|
1.67 %
|
|
1,720
|
|
0.14 %
|
|
249
|
|
1.28 %
|
|
18,394
|
|
0.33 %
|
|
114
|
|
0.01 %
|
|
53,859
|
|
0.97 %
|
|
December 31,
2020
|
25,596
|
|
0.95 %
|
|
6,237
|
|
1.53 %
|
|
1,838
|
|
0.15 %
|
|
123
|
|
1.20 %
|
|
20,585
|
|
0.37 %
|
|
143
|
|
0.01 %
|
|
54,522
|
|
0.98 %
|
|
September 30,
2020
|
23,735
|
|
0.89 %
|
|
5,786
|
|
1.45 %
|
|
2,022
|
|
0.16 %
|
|
75
|
|
1.19 %
|
|
20,034
|
|
0.37 %
|
|
150
|
|
0.01 %
|
|
51,802
|
|
0.96 %
|
|
June 30,
2020
|
21,597
|
|
0.83 %
|
|
4,997
|
|
1.36 %
|
|
1,701
|
|
0.14 %
|
|
47
|
|
0.93 %
|
|
19,449
|
|
0.37 %
|
|
(1,322)
|
|
(0.13) %
|
|
46,469
|
|
0.89 %
|
|
|
(1) Farmer
Mac excludes the Corporate segment in the presentation above
because the segment does not have any interest-earning
assets.
|
|
(2) See
above for a reconciliation of GAAP net interest income by line of
business to net effective spread by line of business for the three
months ended June 30, 2022.
|
The following table presents quarterly core earnings reconciled
to net income attributable to common stockholders:
|
Core Earnings by
Quarter Ended
|
|
June
2022
|
|
March
2022
|
|
December
2021
|
|
September
2021
|
|
June
2021
|
|
March
2021
|
|
December
2020
|
|
September
2020
|
|
June
2020
|
|
|
|
(in
thousands)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net effective
spread
|
$
60,946
|
|
$
57,839
|
|
$
54,333
|
|
$
55,925
|
|
$
56,551
|
|
$
53,859
|
|
$
54,522
|
|
$
51,802
|
|
$
46,469
|
|
Guarantee and
commitment fees
|
4,709
|
|
4,557
|
|
4,637
|
|
4,322
|
|
4,334
|
|
4,240
|
|
4,652
|
|
4,659
|
|
4,943
|
|
Gain on sale of
mortgage loans
|
—
|
|
—
|
|
6,539
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Other
|
307
|
|
514
|
|
241
|
|
687
|
|
301
|
|
451
|
|
512
|
|
453
|
|
1,048
|
|
Total
revenues
|
65,962
|
|
62,910
|
|
65,750
|
|
60,934
|
|
61,186
|
|
58,550
|
|
59,686
|
|
56,914
|
|
52,460
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit related
expense/(income):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Release of)/provision
for losses
|
(1,535)
|
|
(54)
|
|
(1,428)
|
|
255
|
|
(983)
|
|
(31)
|
|
2,973
|
|
1,200
|
|
51
|
|
REO operating
expenses
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Losses/(gains) on sale
of REO
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
22
|
|
—
|
|
—
|
|
Total credit related
expense/(income)
|
(1,535)
|
|
(54)
|
|
(1,428)
|
|
255
|
|
(983)
|
|
(31)
|
|
2,995
|
|
1,200
|
|
51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
employee benefits
|
11,715
|
|
13,298
|
|
11,246
|
|
10,027
|
|
9,779
|
|
11,795
|
|
9,497
|
|
8,791
|
|
8,087
|
|
General and
administrative
|
7,520
|
|
7,278
|
|
8,492
|
|
6,330
|
|
6,349
|
|
6,336
|
|
6,274
|
|
5,044
|
|
5,295
|
|
Regulatory
fees
|
813
|
|
812
|
|
812
|
|
750
|
|
750
|
|
750
|
|
750
|
|
725
|
|
725
|
|
Total operating
expenses
|
20,048
|
|
21,388
|
|
20,550
|
|
17,107
|
|
16,878
|
|
18,881
|
|
16,521
|
|
14,560
|
|
14,107
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
47,449
|
|
41,576
|
|
46,628
|
|
43,572
|
|
45,291
|
|
39,700
|
|
40,170
|
|
41,154
|
|
38,302
|
|
Income tax
expense
|
9,909
|
|
9,024
|
|
9,809
|
|
9,152
|
|
9,463
|
|
8,520
|
|
8,470
|
|
8,297
|
|
8,016
|
|
Preferred stock
dividends
|
6,792
|
|
6,791
|
|
6,792
|
|
6,774
|
|
5,842
|
|
5,269
|
|
5,269
|
|
5,166
|
|
3,939
|
|
Core
earnings
|
$
30,748
|
|
$
25,761
|
|
$
30,027
|
|
$
27,646
|
|
$
29,986
|
|
$
25,911
|
|
$
26,431
|
|
$
27,691
|
|
$
26,347
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciling
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on
undesignated financial derivatives due to fair value
changes
|
$
2,473
|
|
$ 1,698
|
|
$
(1,213)
|
|
$
(1,864)
|
|
$
(3,721)
|
|
$
1,695
|
|
$
(1,758)
|
|
$
(4,149)
|
|
$
8,700
|
|
Gains/(losses) on
hedging activities due to fair value changes
|
5,916
|
|
2,024
|
|
1,476
|
|
(2,093)
|
|
(2,097)
|
|
(271)
|
|
3,827
|
|
(5,245)
|
|
(2,676)
|
|
Unrealized
gains/(losses) on trading assets
|
(285)
|
|
94
|
|
(76)
|
|
36
|
|
(61)
|
|
(14)
|
|
223
|
|
(258)
|
|
(20)
|
|
Net effects of
amortization of premiums/discounts and deferred gains on assets
consolidated at fair value
|
(62)
|
|
20
|
|
71
|
|
23
|
|
20
|
|
16
|
|
(77)
|
|
97
|
|
35
|
|
Net effects of
terminations or net settlements on financial derivatives
|
2,536
|
|
15,512
|
|
(429)
|
|
(351)
|
|
109
|
|
1,165
|
|
1,583
|
|
233
|
|
720
|
|
Issuance costs on the
retirement of preferred stock
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,667)
|
|
—
|
|
Income tax effect
related to reconciling items
|
(2,222)
|
|
(4,063)
|
|
36
|
|
892
|
|
1,208
|
|
(544)
|
|
(798)
|
|
1,957
|
|
(1,419)
|
|
Net income
attributable to common stockholders
|
$
39,104
|
|
$
41,046
|
|
$
29,892
|
|
$
24,289
|
|
$
25,444
|
|
$
27,958
|
|
$
29,431
|
|
$
18,659
|
|
$
31,687
|
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SOURCE Farmer Mac