Allowance for Losses and Concentration of Credit Risk (Tables)

6 Months Ended

Jun. 30, 2012

Allowance for Losses and Concentrations of Credit Risk [Abstract]

Schedule of Credit Losses Related to Financing Receivables, Current and Noncurrent

The following is a summary of the changes in the allowance for losses for the three and six months ended June 30, 2012 and 2011:

	June 30, 2012							June 30, 2011
	Allowance for Loan Losses			Reserve for Losses		Total Allowance for Losses		Allowance for Loan Losses			Reserve for Losses			Total Allowance for Losses
	(in thousands)
For the Three Months Ended:
Beginning Balance	$	10,581		$	7,385	$	17,966	$	11,084		$	8,378		$	19,462
(Release of)/provision for losses	(1,220		)	1,394		174		160			(935		)	(775		)
Charge-offs	—			—		—		(191		)	—			(191		)
Ending Balance	$	9,361		$	8,779	$	18,140	$	11,053		$	7,443		$	18,496
For the Six Months Ended:
Beginning Balance	$	10,161		$	7,355	$	17,516	$	9,803		$	10,312		$	20,115
(Release of)/provision for losses	(800		)	1,424		624		1,441			(2,869		)	(1,428		)
Charge-offs	—			—		—		(191		)	—			(191		)
Ending Balance	$	9,361		$	8,779	$	18,140	$	11,053		$	7,443		$	18,496

The following tables present the changes in the allowance for losses for the three and six months ended June 30, 2012 and 2011 by commodity type:

	June 30, 2012
	Crops		Permanent Plantings			Livestock			Part-time Farm			Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
For the Three Months Ended:
Beginning Balance	$	4,266	$	3,482		$	636		$	1,475		$	8,100	$	7	$	17,966
Provision for/(release of) losses	15		(794		)	(173		)	(76		)	1,202		—		174
Charge-offs	—		—			—			—			—		—		—
Ending Balance	$	4,281	$	2,688		$	463		$	1,399		$	9,302	$	7	$	18,140
For the Six Months Ended:
Beginning Balance	$	4,133	$	3,365		$	685		$	1,223		$	8,106	$	4	$	17,516
Provision for/(release of) losses	148		(677		)	(222		)	176			1,196		3		624
Charge-offs	—		—			—			—			—		—		—
Ending Balance	$	4,281	$	2,688		$	463		$	1,399		$	9,302	$	7	$	18,140

	June 30, 2011
	Crops			Permanent Plantings			Livestock			Part-time Farm		Ag. Storage and Processing (including ethanol facilities)			Other			Total
	(in thousands)
For the Three Months Ended:
Beginning Balance	$	3,922		$	3,802		$	1,850		$	1,053	$	8,823		$	12		$	19,462
(Release of)/provision for losses	(31		)	8			(68		)	42		(723		)	(3		)	(775		)
Charge-offs	(176		)	(7		)	(8		)	—		—			—			(191		)
Ending Balance	$	3,715		$	3,803		$	1,774		$	1,095	$	8,100		$	9		$	18,496
For the Six Months Ended:
Beginning Balance	$	3,572		$	3,537		$	2,749		$	445	$	9,797		$	15		$	20,115
Provision for/(release of) losses	319			273			(967		)	650		(1,697		)	(6		)	(1,428		)
Charge-offs	(176		)	(7		)	(8		)	—		—			—			(191		)
Ending Balance	$	3,715		$	3,803		$	1,774		$	1,095	$	8,100		$	9		$	18,496

Allowance for Credit Losses on Financing Receivables

The following tables present the ending balances of loans held and loans underlying LTSPCs and Farmer Mac Guaranteed Securities and the related allowance for losses by impairment method and commodity type as of June 30, 2012 and December 31, 2011:

	As of June 30, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Ending Balance
Evaluated collectively for impairment	$	1,912,073	$	792,842	$	1,201,256	$	208,088	$	177,018	$	13,180	$	4,304,457
Evaluated individually for impairment	29,002		30,557		17,465		16,377		4,337		1,017		98,755
	$	1,941,075	$	823,399	$	1,218,721	$	224,465	$	181,355	$	14,197	$	4,403,212
Allowance for Losses
Evaluated collectively for impairment	$	1,662	$	1,221	$	122	$	761	$	6,252	$	6	$	10,024
Evaluated individually for impairment	2,619		1,467		341		638		3,050		1		8,116
	$	4,281	$	2,688	$	463	$	1,399	$	9,302	$	7	$	18,140

	As of December 31, 2011
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Ending Balance
Evaluated collectively for impairment	$	1,835,439	$	796,100	$	1,213,227	$	232,607	$	167,850	$	15,914	$	4,261,137
Evaluated individually for impairment	29,520		28,245		10,884		12,513		5,842		1,022		88,026
	$	1,864,959	$	824,345	$	1,224,111	$	245,120	$	173,692	$	16,936	$	4,349,163
Allowance for Losses
Evaluated collectively for impairment	$	1,723	$	1,290	$	172	$	775	$	6,256	$	4	$	10,220
Evaluated individually for impairment	2,410		2,075		513		448		1,850		—		7,296
	$	4,133	$	3,365	$	685	$	1,223	$	8,106	$	4	$	17,516

Impaired Financing Receivables

The following tables present by commodity type the unpaid principal balances, recorded investment and specific allowance for losses related to impaired loans and the recorded investment in loans on nonaccrual status as of June 30, 2012 and December 31, 2011:

	As of June 30, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
Impaired Loans:
With no specific allowance:
Recorded investment	$	3,142	$	9,073	$	5,853	$	2,895	$	—	$	925	$	21,888
Unpaid principal balance	3,110		9,041		5,756		2,894		—		901		21,702
With a specific allowance:
Recorded investment	27,070		21,696		11,897		13,623		4,399		117		78,802
Unpaid principal balance	25,892		21,516		11,709		13,483		4,337		116		77,053
Associated allowance	2,619		1,467		341		638		3,050		1		8,116
Total:
Recorded investment	30,212		30,769		17,750		16,518		4,399		1,042		100,690
Unpaid principal balance	29,002		30,557		17,465		16,377		4,337		1,017		98,755
Associated allowance	2,619		1,467		341		638		3,050		1		8,116
Recorded investment of loans on nonaccrual status:	$	8,824	$	23,566	$	4,397	$	8,064	$	—	$	—	$	44,851

	As of December 31, 2011
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
Impaired Loans:
With no specific allowance:
Recorded investment	$	6,809	$	10,083	$	3,248	$	3,241	$	—	$	914	$	24,295
Unpaid principal balance	7,446		9,957		4,088		3,298		—		902		25,691
With a specific allowance:
Recorded investment	23,009		18,668		7,036		9,392		5,842		121		64,068
Unpaid principal balance	22,074		18,288		6,796		9,215		5,842		120		62,335
Associated allowance	2,410		2,075		513		448		1,850		—		7,296
Total:
Recorded investment	29,818		28,751		10,284		12,633		5,842		1,035		88,363
Unpaid principal balance	29,520		28,245		10,884		12,513		5,842		1,022		88,026
Associated allowance	2,410		2,075		513		448		1,850		—		7,296
Recorded investment of loans on nonaccrual status:	$	9,214	$	25,710	$	3,483	$	6,931	$	—	$	—	$	45,338

The following table presents by commodity type the average recorded investment and interest income recognized on impaired loans for the three and six months ended June 30, 2012 and 2011:

	June 30, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
For the Three Months Ended:
Average recorded investment in impaired loans	$	27,873	$	35,012	$	16,036	$	17,671	$	4,400	$	1,041	$	102,033
Income recognized on impaired loans	64		376		63		83		—		—		586
For the Six Months Ended:
Average recorded investment in impaired loans	28,521		32,925		14,118		15,992		4,880		1,039		97,475
Income recognized on impaired loans	141		676		116		174		—		—		1,107

	June 30, 2011
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
For the Three Months Ended:
Average recorded investment in impaired loans	$	30,040	$	29,531	$	12,990	$	9,391	$	6,458	$	723	$	89,133
Income recognized on impaired loans	59		186		29		19		—		—		293
For the Six Months Ended:
Average recorded investment in impaired loans	32,016		30,188		14,597		10,235		6,578		817		94,431
Income recognized on impaired loans	215		213		246		60		382		—		1,116

Schedule of Certain Loans Acquired in Transfer Acquired During Period

The following tables present information related to Farmer Mac's acquisition of defaulted loans for the three and six months ended June 30, 2012 and 2011 and the outstanding balances and carrying amounts of all such loans as of June 30, 2012 and December 31, 2011:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2012		June 30, 2011		June 30, 2012		June 30, 2011
	(in thousands)
Unpaid principal balance at acquisition date:
Loans underlying LTSPCs	$	2,530	$	1,420	$	2,530	$	16,976
Loans underlying Farmer Mac Guaranteed Securities	598		—		1,327		1,369
Total unpaid principal balance at acquisition date	3,128		1,420		3,857		18,345
Contractually required payments receivable	3,125		1,420		3,857		18,392
Impairment recognized subsequent to acquisition	—		—		15		3,770
Recovery/release of allowance for defaulted loans	893		4		933		14

	June 30, 2012		December 31, 2011
	(in thousands)
Outstanding balance	$	38,876	$	35,773
Carrying amount	30,051		29,461

Schedule of Certain Loans Acquired in Transfer Acquired During Period, Delinquencies and Credit Losses

	90-Day Delinquencies (1)						Net Credit (Recoveries)/Losses
	As of						For the Six Months Ended
	June 30, 2012		December 31, 2011		June 30, 2011		June 30, 2012			June 30, 2011
	(in thousands)
On-balance sheet assets:
Farmer Mac I:
Loans	$	31,092	$	33,243	$	32,862	$	(262	)	$	164
Total on-balance sheet	$	31,092	$	33,243	$	32,862	$	(262	)	$	164
Off-balance sheet assets:
Farmer Mac I:
LTSPCs	$	15,934	$	7,379	$	21,771	$	—		$	—
Total off-balance sheet	$	15,934	$	7,379	$	21,771	$	—		$	—
Total	$	47,026	$	40,622	$	54,633	$	(262	)	$	164

(1) Includes loans and loans underlying Farmer Mac I Guaranteed Securities and LTSPCs that are 90 days or more past due, in foreclosure, restructured after delinquency, and in bankruptcy, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.

Financing Receivable Credit Quality Indicators

The following tables present credit quality indicators related to loans held and loans underlying LTSPCs and Farmer Mac I Guaranteed Securities (excluding AgVantage securities) as of June 30, 2012 and December 31, 2011.  

	As of June 30, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Credit risk profile by internally assigned grade (1)
Grade:
Acceptable	$	1,860,579	$	744,379	$	1,104,200	$	198,092	$	111,317	$	12,437	$	4,031,004
Other assets especially mentioned ("OAEM") (2)	40,386		27,071		65,297		6,590		47,393		633		187,370
Substandard (2)	40,110		51,949		49,224		19,783		22,645		1,127		184,838
Total	$	1,941,075	$	823,399	$	1,218,721	$	224,465	$	181,355	$	14,197	$	4,403,212
Commodity analysis of past due loans (1)
90 days or more past due	$	14,274	$	15,223	$	10,251	$	7,278	$	—	$	—	$	47,026

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans. 

(2) Assets in the OAEM category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.  Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

	As of December 31, 2011
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Credit risk profile by internally assigned grade (1)
Grade:
Acceptable	$	1,769,768	$	748,558	$	1,097,184	$	215,525	$	96,532	$	15,158	$	3,942,725
Other assets especially mentioned ("OAEM") (2)	60,076		20,442		74,959		7,103		45,673		641		208,894
Substandard (2)	35,115		55,345		51,968		22,492		31,487		1,137		197,544
Total	$	1,864,959	$	824,345	$	1,224,111	$	245,120	$	173,692	$	16,936	$	4,349,163
Commodity analysis of past due loans (1)
90 days or more past due	$	11,605	$	19,228	$	2,475	$	7,315	$	—	$	—	$	40,623

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.  

(2) Assets in the OAEM category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.  Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

Schedules of Concentration of Risk, by Risk Factor

The following table sets forth the geographic and commodity/collateral diversification, as well as the range of original loan-to-value ratios, for all loans held and loans underlying Farmer Mac I Guaranteed Securities (excluding AgVantage securities) and LTSPCs as of June 30, 2012 and December 31, 2011:

	June 30, 2012		December 31, 2011
	(in thousands)
By commodity/collateral type:
Crops	$	1,941,075	$	1,864,959
Permanent plantings	823,399		824,345
Livestock	1,218,721		1,224,111
Part-time farm	224,465		245,120
Ag. Storage and processing (including ethanol facilities)	181,355		173,692
Other	14,197		16,936
Total	$	4,403,212	$	4,349,163
By geographic region (1):
Northwest	$	764,422	$	761,078
Southwest	1,581,489		1,597,369
Mid-North	869,722		857,659
Mid-South	516,815		484,176
Northeast	282,025		294,854
Southeast	388,739		354,027
Total	$	4,403,212	$	4,349,163
By original loan-to-value ratio:
0.00% to 40.00%	$	1,122,067	$	1,104,617
40.01% to 50.00%	792,882		769,618
50.01% to 60.00%	1,219,133		1,225,939
60.01% to 70.00%	1,097,884		1,062,061
70.01% to 80.00%	130,902		135,985
80.01% to 90.00%	40,344		50,943
Total	$	4,403,212	$	4,349,163

(1) Geographic regions:  Northwest (AK, ID, MT, ND, NE, OR, SD, WA, WY); Southwest (AZ, CA, CO, HI, NM, NV, UT); Mid-North (IA, IL, IN, MI, MN, MO, WI); Mid-South (KS, OK, TX); Northeast (CT, DE, KY, MA, MD, ME, NC, NH, NJ, NY, OH, PA, RI, TN, VA, VT, WV); Southeast (AL, AR, FL, GA, LA, MS, SC).