Allowance for Credit Losses - (Tables)

6 Months Ended

Nov. 30, 2021

Schedule of Allowance for Credit Losses on Financing Receivables

The following tables summarize, by member class, changes in the allowance for credit losses for our loan portfolio for the three and six months ended November 30, 2021 and 2020.

Table 5.1: Changes in Allowance for Credit Losses


	Three Months Ended November 30, 2021
(Dollars in thousands)	CFC Distribution		CFC Power Supply		CFC Statewide & Associate		CFC Total		NCSC		RTFC		Total
Balance as of August 31, 2021	$	15,369	$	66,469	$	1,422	$	83,260	$	1,455	$	4,820	$	89,535


Provision (benefit) for credit losses	663		(1,002)		2		(337)		139		(3,202)		(3,400)

Balance as of November 30, 2021	$	16,032	$	65,467	$	1,424	$	82,923	$	1,594	$	1,618	$	86,135


	Three Months Ended November 30, 2020
(Dollars in thousands)	CFC Distribution		CFC Power Supply		CFC Statewide & Associate		CFC Total		NCSC		RTFC		Total
Balance as of August 31, 2020	$	12,037	$	39,282	$	1,411	$	52,730	$	829	$	3,792	$	57,351


Provision (benefit) for credit losses	1,178		499		2		1,679		512		(553)		1,638


Balance as of November 30, 2020	$	13,215	$	39,781	$	1,413	$	54,409	$	1,341	$	3,239	$	58,989


	Six Months Ended November 30, 2021
(Dollars in thousands)	CFC Distribution		CFC Power Supply		CFC Statewide & Associate		CFC Total		NCSC		RTFC		Total
Balance as of May 31, 2021	$	13,426	$	64,646	$	1,391	$	79,463	$	1,374	$	4,695	$	85,532


Provision (benefit) for credit losses	2,606		821		33		3,460		220		(3,077)		603

Balance as of November 30, 2021	$	16,032	$	65,467	$	1,424	$	82,923	$	1,594	$	1,618	$	86,135


	Six Months Ended November 30, 2020
(Dollars in thousands)	CFC Distribution		CFC Power Supply		CFC Statewide & Associate		CFC Total		NCSC		RTFC		Total
Balance as of May 31, 2020	$	8,002	$	38,027	$	1,409	$	47,438	$	806	$	4,881	$	53,125
Cumulative-effect adjustment from adoption of CECL accounting standard	3,586		2,034		25		5,645		(15)		(1,730)		3,900
Balance as of June 1, 2020	11,588		40,061		1,434		53,083		791		3,151		57,025
Provision (benefit) for credit losses	1,627		(280)		(21)		1,326		550		88		1,964


Balance as of November 30, 2020	$	13,215	$	39,781	$	1,413	$	54,409	$	1,341	$	3,239	$	58,989

Schedule of Allowance for Credit Losses and Recorded Investment in Financing Receivables

The following tables present, by member class, the components of our allowance for credit losses as of November 30, 2021 and May 31, 2021.

Table 5.2: Allowance for Credit Losses Components


	November 30, 2021
(Dollars in thousands)	CFC Distribution		CFC Power Supply		CFC Statewide & Associate		CFC Total		NCSC		RTFC		Total
Allowance components:
Collective allowance	$	16,032	$	25,809	$	1,424	$	43,265	$	1,594	$	1,215	$	46,074
Asset-specific allowance	—		39,658		—		39,658		—		403		40,061
Total allowance for credit losses	$	16,032	$	65,467	$	1,424	$	82,923	$	1,594	$	1,618	$	86,135

Loans outstanding:(1)
Collectively evaluated loans	$	22,552,985	$	4,902,962	$	101,391	$	27,557,338	$	721,299	$	427,299	$	28,705,936
Individually evaluated loans	5,092		219,444		—		224,536		—		4,342		228,878
Total loans outstanding	$	22,558,077	$	5,122,406	$	101,391	$	27,781,874	$	721,299	$	431,641	$	28,934,814


Allowance ratios:
Collective allowance coverage ratio(2)	0.07%	0.53%	1.40%	0.16%	0.22%	0.28%	0.16%
Asset-specific allowance coverage ratio(3)	—	18.07	—	17.66	—	9.28	17.50
Total allowance coverage ratio(4)	0.07	1.28	1.40	0.30	0.22	0.37	0.30


	May 31, 2021
(Dollars in thousands)	CFC Distribution		CFC Power Supply		CFC Statewide & Associate		CFC Total		NCSC		RTFC		Total
Allowance components:
Collective allowance	$	13,426	$	25,104	$	1,391	$	39,921	$	1,374	$	1,147	$	42,442
Asset-specific allowance(5)	—		39,542		—		39,542		—		3,548		43,090
Total allowance for credit losses	$	13,426	$	64,646	$	1,391	$	79,463	$	1,374	$	4,695	$	85,532

Loans outstanding:(1)
Collectively evaluated loans	$	22,022,044	$	4,926,000	$	106,121	$	27,054,165	$	706,868	$	406,606	$	28,167,639
Individually evaluated loans	5,379		228,312		—		233,691		—		13,777		247,468
Total loans outstanding	$	22,027,423	$	5,154,312	$	106,121	$	27,287,856	$	706,868	$	420,383	$	28,415,107


Allowance ratios:
Collective allowance coverage ratio(2)	0.06%	0.51%	1.31%	0.15%	0.19%	0.28%	0.15%
Asset-specific allowance coverage ratio(3)	—	17.32	—	16.92	—	25.75	17.41
Total allowance coverage ratio(4)	0.06	1.25	1.31	0.29	0.19	1.12	0.30

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(1)Represents the unpaid principal amount of loans as of the end of each period. Excludes unamortized deferred loan origination costs of $12 million as of November 30, 2021 and May 31, 2021.

(2)Calculated based on the collective allowance component at period end divided by collectively evaluated loans outstanding at period end.

(3)Calculated based on the asset-specific allowance component at period end divided by individually evaluated loans outstanding at period end.

(4)Calculated based on the total allowance for credit losses at period end divided by total loans outstanding at period end.