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Investment Securities
 12 Months Ended
Dec. 31, 2011
Notes to Financial Statements [Abstract]  
Investment Securities
INVESTMENT SECURITIES

The following tables present the amortized cost and fair values of Farmer Mac's investment securities as of December 31, 2011 and 2010:
 
 
December 31, 2011
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair Value
 
(in thousands)
Available-for-sale:
 
 
 
 
 
 
 
Floating rate auction-rate certificates backed by Government guaranteed student loans
$
74,100

 
$
—

 
$
(13,887
)
 
$
60,213

Floating rate asset-backed securities
178,443

 
219

 
(102
)
 
178,560

Floating rate corporate debt securities
74,152

 
69

 
(388
)
 
73,833

Fixed rate corporate debt securities
38,678

 
27

 
(6
)
 
38,699

Floating rate Government/GSE guaranteed mortgage-backed securities
759,567

 
4,852

 
(381
)
 
764,038

Fixed rate GSE guaranteed mortgage-backed securities
3,106

 
254

 
—

 
3,360

Floating rate GSE subordinated debt
70,000

 
—

 
(17,438
)
 
52,562

Fixed rate commercial paper
9,999

 
1

 
—

 
10,000

Fixed rate GSE preferred stock
79,662

 
5,216

 
—

 
84,878

Floating rate senior agency debt
38,000

 
32

 
—

 
38,032

Fixed rate senior agency debt
79,255

 
19

 
(21
)
 
79,253

Fixed rate U.S. Treasuries
798,966

 
304

 
(4
)
 
799,266

Total available-for-sale
2,203,928

 
10,993

 
(32,227
)
 
2,182,694

Trading:
 

 
 

 
 

 
 

Floating rate asset-backed securities
5,138

 
—

 
(3,342
)
 
1,796

Total investment securities
$
2,209,066

 
$
10,993

 
$
(35,569
)
 
$
2,184,490


 
December 31, 2010
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair Value
 
(in thousands)
Available-for-sale:
 
 
 
 
 
 
 
Floating rate auction-rate certificates backed by Government guaranteed student loans
$
74,100

 
$
—

 
$
(9,765
)
 
$
64,335

Floating rate asset-backed securities
29,437

 
24

 
(3
)
 
29,458

Floating rate corporate debt securities
162,891

 
422

 
(125
)
 
163,188

Floating rate Government/GSE guaranteed mortgage-backed securities
573,288

 
4,173

 
(681
)
 
576,780

Fixed rate GSE guaranteed mortgage-backed securities
4,525

 
296

 
—

 
4,821

Floating rate GSE subordinated debt
70,000

 
—

 
(14,671
)
 
55,329

Fixed rate GSE preferred stock
80,001

 
4,827

 
—

 
84,828

Fixed rate senior agency debt
5,500

 
—

 
—

 
5,500

Fixed rate U.S. Treasuries
692,808

 
232

 
(46
)
 
692,994

Total available-for-sale
1,692,550

 
9,974

 
(25,291
)
 
1,677,233

Trading:
 

 
 

 
 

 
 

Floating rate asset-backed securities
5,961

 
—

 
(4,561
)
 
1,400

Fixed rate GSE preferred stock
83,813

 
883

 
—

 
84,696

Total trading
89,774

 
883

 
(4,561
)
 
86,096

Total investment securities
$
1,782,324

 
$
10,857

 
$
(29,852
)
 
$
1,763,329


Farmer Mac did not recognize in earnings any other-than-temporary impairment losses on available-for-sale investment securities during 2011 or 2010, compared to other-than-temporary impairment losses on available-for-sale investment securities of $2.7 million in 2009. 

During 2011, Farmer Mac received proceeds of $447.9 million from the sale of securities from its available-for-sale investment portfolio, resulting in gross realized gains of $0.3 million and gross realized losses of $10,000.  During 2010, Farmer Mac received proceeds of $106.3 million from the sale of securities from its available-for-sale investment portfolio, resulting in gross realized gains of $0.5 million and gross realized losses of $0.2 million.  During 2009, Farmer Mac received proceeds of $306.5 million from the sale of securities from its available-for-sale investment portfolio, resulting in gross realized gains of $4.6 million and gross realized losses of $1.2 million.

As of December 31, 2011, Farmer Mac's trading securities had a fair value of $1.8 million, which reflects an unrealized loss of $3.3 million.  As of December 31, 2010, Farmer Mac's trading securities had a fair value of $86.1 million, which reflects an unrealized gain of $0.9 million and an unrealized loss of $4.6 million. Trading securities decreased during 2011 due to the call of $83.0 million of GSE preferred stock in December 2011.

As of December 31, 2011 and 2010, unrealized losses on available-for-sale securities were as follows:

 
December 31, 2011
 
Available-for-Sale Securities
 
Unrealized loss position for
less than 12 months
 
Unrealized loss position for
more than 12 months
 
Fair Value
 
Unrealized
Loss
 
Fair Value
 
Unrealized
Loss
 
(in thousands)
Floating rate corporate debt securities
$
41,061

 
$
(388
)
 
$
—

 
$
—

Fixed rate corporate debt securities
18,189

 
(6
)
 
—

 
—

Floating rate asset-backed securities
63,496

 
(102
)
 
—

 
—

Floating rate auction-rate certificates backed by Government guaranteed student loans
—

 
—

 
60,213

 
(13,887
)
Floating rate Government/GSE guaranteed mortgage-backed securities
235,454

 
(359
)
 
17,409

 
(22
)
Floating rate GSE subordinated debt
—

 
—

 
52,562

 
(17,438
)
Fixed rate senior agency debt
44,976

 
(21
)
 
—

 
—

Fixed rate U.S. Treasuries
50,160

 
(4
)
 
—

 
—

Total
$
453,336

 
$
(880
)
 
$
130,184

 
$
(31,347
)

 
December 31, 2010
 
Available-for-Sale Securities
 
Unrealized loss position for
less than 12 months
 
Unrealized loss position for
more than 12 months
 
Fair Value
 
Unrealized
Loss
 
Fair Value
 
Unrealized
Loss
 
(in thousands)
Floating rate corporate debt securities
$
—

 
$
—

 
$
99,874

 
$
(125
)
Floating rate asset-backed securities
—

 
—

 
2,779

 
(3
)
Floating rate auction-rate certificates backed by Government guaranteed student loans
—

 
—

 
64,335

 
(9,765
)
Floating rate Government/GSE guaranteed mortgage-backed securities
159,294

 
(587
)
 
4,138

 
(94
)
Floating rate GSE subordinated debt
—

 
—

 
55,329

 
(14,671
)
Fixed rate U.S. Treasuries
163,026

 
(46
)
 
—

 
—

Total
$
322,320

 
$
(633
)
 
$
226,455

 
$
(24,658
)
 
The temporary unrealized losses presented above are principally due to a general widening of credit spreads from the dates of acquisition to December 31, 2011 and 2010, as applicable.  The resulting decreases in fair values reflect an increase in the perceived risk by the financial markets related to those securities. As of December 31, 2011, all of the investment securities in an unrealized loss position had credit ratings of at least "A" except one that was rated "A-" and two that were rated "BBB+".  As of December 31, 2010, all of the investment securities in an unrealized loss position had credit ratings of at least "A".  The unrealized losses were on 44 and 47 individual investment securities as of December 31, 2011 and 2010, respectively.

As of December 31, 2011, 10 of the securities in loss positions had been in loss positions for more than 12 months and had a total unrealized loss of $31.3 million.  As of December 31, 2010, 29 of the securities in loss positions had been in loss positions for more than 12 months and had a total unrealized loss of $24.7 million.  The unrealized losses on those securities are principally due to a general widening of credit spreads from the dates of acquisition.  Securities in unrealized loss positions 12 months or more have a fair value as of December 31, 2011 that is, on average, approximately 81 percent of their amortized cost basis.  Farmer Mac believes that all these unrealized losses are recoverable within a reasonable period of time by way of changes in credit spreads or maturity.  Accordingly, Farmer Mac has concluded that none of the unrealized losses on these available-for-sale investment securities represent other-than-temporary impairment as of December 31, 2011.  Farmer Mac does not intend to sell these securities and it is not more likely than not that Farmer Mac will be required to sell the securities before recovery of the amortized cost basis.

Farmer Mac did not own any held-to-maturity investments as of December 31, 2011 and 2010.  As of December 31, 2011, Farmer Mac owned trading investment securities with an amortized cost of $5.1 million, a fair value of $1.8 million and a weighted average yield of 4.36 percent.  As of December 31, 2010, Farmer Mac owned trading investment securities with an amortized cost of $89.8 million, a fair value of $86.1 million and a weighted average yield of 8.12 percent.

The amortized cost, fair value and yield of investments by remaining contractual maturity for available-for-sale investment securities as of December 31, 2011 are set forth below.  Asset-backed and mortgage-backed securities are included based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets or mortgages.

 
Investment Securities Available-for-Sale
as of December 31, 2011
 
Amortized
Cost
 
Fair Value
 
Weighted-
Average
Yield
 
(dollars in thousands)
Due within one year
$
931,569

 
$
931,812

 
0.93%
Due after one year through five years
117,374

 
117,154

 
0.98%
Due after five years through ten years
426,586

 
428,512

 
1.16%
Due after ten years
728,399

 
705,216

 
2.14%
Total
$
2,203,928

 
$
2,182,694

 
1.37%