Loans and Allowance for Losses and Concentrations of Credit Risk - Loans and Allowance for Losses and Concentrations (Tables)

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

Loans

Farmer Mac classifies loans as either held for investment or held for sale. Loans held for investment are recorded at the unpaid principal balance, net of unamortized premium or discount and other cost adjustments. Loans held for sale are reported at the lower of cost or fair value determined on a pooled basis. As of March 31, 2015 and December 31, 2014, Farmer Mac had no loans held for sale. The following table displays the composition of the loan balances as of March 31, 2015 and December 31, 2014:

Table 5.1

	As of March 31, 2015									As of December 31, 2014
	Unsecuritized			In Consolidated Trusts			Total			Unsecuritized			In Consolidated Trusts			Total
	(in thousands)
Farm & Ranch	$	2,113,795		$	457,117		$	2,570,912		$	2,118,867		$	421,355		$	2,540,222
Rural Utilities	968,117			—			968,117			718,213			267,396			985,609
Total unpaid principal balance(1)	3,081,912			457,117			3,539,029			2,837,080			688,751			3,525,831
Unamortized premiums, discounts and other cost basis adjustments	466			—			466			(3,619		)	3,727			108
Total loans	3,082,378			457,117			3,539,495			2,833,461			692,478			3,525,939
Allowance for loan losses	(5,396		)	(544		)	(5,940		)	(5,324		)	(540		)	(5,864		)
Total loans, net of allowance	$	3,076,982		$	456,573		$	3,533,555		$	2,828,137		$	691,938		$	3,520,075

⁽¹⁾  Unpaid principal balance is the basis of presentation in disclosures of outstanding balances for Farmer Mac's lines of business.

Allowance for Credit Losses on Financing Receivables [Table Text Block]

Allowances for Losses

Farmer Mac maintains an allowance for losses presented in two components on its consolidated balance sheets: an allowance for loan losses to account for estimated probable losses on loans held, and a reserve for losses to account for estimated probable losses on loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities.  As of March 31, 2015 and December 31, 2014, Farmer Mac reported allowances for losses of $9.4 million and $10.1 million, respectively. See Note 6 for more information about off-balance sheet Farmer Mac Guaranteed Securities and LTSPCs.  

The following is a summary of the changes in the allowance for losses for the three months ended March 31, 2015 and 2014:

Table 5.2

	As of March 31, 2015								As of March 31, 2014
	Allowance for Loan Losses		Reserve for Losses			Total Allowance for Losses			Allowance for Loan Losses			Reserve for Losses		Total Allowance for Losses
For the Three Months Ended	(in thousands)
Beginning Balance	$	5,864	$	4,263		$	10,127		$	6,866		$	6,468	$	13,334
Provision for/(release of) losses	76		(772		)	(696		)	573			101		674
Charge-offs	—		—			—			(29		)	—		(29		)
Ending Balance	5,940		3,491			9,431			7,410			6,569		13,979

During first quarter 2015, Farmer Mac recorded provisions from its allowance for loan losses of $0.1 million and releases from its reserve for losses of $0.8 million, primarily related to paydowns of processing loans (e.g., ethanol and canola facilities) underlying LTSPCs. Farmer Mac recorded no charge-offs to its allowance for loan losses during first quarter 2015.

During first quarter 2014, Farmer Mac recorded provisions to its allowance for loan losses of $0.6 million and provisions to its reserve for losses of $0.1 million. Farmer Mac also recorded $29,000 of charge-offs to its allowance for loan losses during first quarter 2014.

The following tables present the changes in the total allowance for losses for the three months ended March 31, 2015 and 2014 by commodity type:

Table 5.3

	March 31, 2015
	Crops		Permanent Plantings		Livestock			Part-time Farm			Ag. Storage and Processing			Other		Total
	(in thousands)
For the Three Months Ended:
Beginning Balance	$	2,519	$	2,159	$	1,423		$	467		$	3,552		$	7	$	10,127
Provision for/(release of) losses	121		125		(80		)	(8		)	(854		)	—		(696		)
Ending Balance	$	2,640	$	2,284	$	1,343		$	459		$	2,698		$	7	$	9,431

	March 31, 2014
	Crops		Permanent Plantings			Livestock		Part-time Farm			Ag. Storage and Processing		Other			Total
	(in thousands)
For the Three Months Ended:
Beginning Balance	$	2,124	$	2,186		$	1,271	$	454		$	7,292	$	7		$	13,334
Provision for/(release of) losses	154		(55		)	116		39			423		(3		)	674
Charge-offs	—		—			—		(29		)	—		—			(29		)
Ending Balance	$	2,278	$	2,131		$	1,387	$	464		$	7,715	$	4		$	13,979

Schedule of Allowance for Losses by Impairment Method and Commodity [Table Text Block]

The following tables present the unpaid principal balances of loans held and loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities and the related total allowance for losses by impairment method and commodity type as of March 31, 2015 and December 31, 2014:

Table 5.4

	As of March 31, 2015
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
Ending Balance:
Collectively evaluated for impairment:
On-balance sheet	$	1,642,496	$	367,380	$	402,478	$	57,995	$	25,800	$	1,360	$	2,497,509
Off-balance sheet	1,265,316		500,504		804,467		99,844		84,567		6,306		2,761,004
Total	$	2,907,812	$	867,884	$	1,206,945	$	157,839	$	110,367	$	7,666	$	5,258,513
Individually evaluated for impairment:
On-balance sheet	$	18,706	$	38,030	$	6,178	$	10,489	$	—	$	—	$	73,403
Off-balance sheet	2,458		3,174		8,611		1,089		—		—		15,332
Total	$	21,164	$	41,204	$	14,789	$	11,578	$	—	$	—	$	88,735
Total Farm & Ranch loans:
On-balance sheet	$	1,661,202	$	405,410	$	408,656	$	68,484	$	25,800	$	1,360	$	2,570,912
Off-balance sheet	1,267,774		503,678		813,078		100,933		84,567		6,306		2,776,336
Total	$	2,928,976	$	909,088	$	1,221,734	$	169,417	$	110,367	$	7,666	$	5,347,248
Allowance for Losses:
Collectively evaluated for impairment:
On-balance sheet	$	1,726	$	520	$	654	$	49	$	335	$	—	$	3,284
Off-balance sheet	274		155		340		53		2,363		7		3,192
Total	$	2,000	$	675	$	994	$	102	$	2,698	$	7	$	6,476
Individually evaluated for impairment:
On-balance sheet	$	517	$	1,502	$	317	$	320	$	—	$	—	$	2,656
Off-balance sheet	123		107		32		37		—		—		299
Total	$	640	$	1,609	$	349	$	357	$	—	$	—	$	2,955
Total Farm & Ranch loans:
On-balance sheet	$	2,243	$	2,022	$	971	$	369	$	335	$	—	$	5,940
Off-balance sheet	397		262		372		90		2,363		7		3,491
Total	$	2,640	$	2,284	$	1,343	$	459	$	2,698	$	7	$	9,431

	As of December 31, 2014
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
Ending Balance:
Collectively evaluated for impairment:
On-balance sheet	$	1,621,360	$	359,517	$	406,049	$	57,851	$	29,003	$	—	$	2,473,780
Off-balance sheet	1,305,141		521,535		839,286		102,857		85,357		6,781		2,860,957
Total	$	2,926,501	$	881,052	$	1,245,335	$	160,708	$	114,360	$	6,781	$	5,334,737
Individually evaluated for impairment:
On-balance sheet	$	12,307	$	35,904	$	6,571	$	11,660	$	—	$	—	$	66,442
Off-balance sheet	2,458		3,239		8,712		1,586		—		—		15,995
Total	$	14,765	$	39,143	$	15,283	$	13,246	$	—	$	—	$	82,437
Total Farm & Ranch loans:
On-balance sheet	$	1,633,667	$	395,421	$	412,620	$	69,511	$	29,003	$	—	$	2,540,222
Off-balance sheet	1,307,599		524,774		847,998		104,443		85,357		6,781		2,876,952
Total	$	2,941,266	$	920,195	$	1,260,618	$	173,954	$	114,360	$	6,781	$	5,417,174
Allowance for Losses:
Collectively evaluated for impairment:
On-balance sheet	$	1,824	$	495	$	658	$	51	$	503	$	—	$	3,531
Off-balance sheet	298		149		404		52		3,049		7		3,959
Total	$	2,122	$	644	$	1,062	$	103	$	3,552	$	7	$	7,490
Individually evaluated for impairment:
On-balance sheet	$	283	$	1,410	$	328	$	312	$	—	$	—	$	2,333
Off-balance sheet	114		105		33		52		—		—		304
Total	$	397	$	1,515	$	361	$	364	$	—	$	—	$	2,637
Total Farm & Ranch loans:
On-balance sheet	$	2,107	$	1,905	$	986	$	363	$	503	$	—	$	5,864
Off-balance sheet	412		254		437		104		3,049		7		4,263
Total	$	2,519	$	2,159	$	1,423	$	467	$	3,552	$	7	$	10,127

Impaired Financing Receivables [Table Text Block]

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 March 31, 2015 and December 31, 2014:

Table 5.5

	As of March 31, 2015
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
Impaired Loans:
With no specific allowance:
Recorded investment	$	3,117	$	5,622	$	9,360	$	1,625	$	—	$	—	$	19,724
Unpaid principal balance	2,982		5,535		9,174		1,625		—		—		19,316
With a specific allowance:
Recorded investment(1)	19,689		36,378		5,707		10,038		—		—		71,812
Unpaid principal balance	18,182		35,669		5,615		9,953		—		—		69,419
Associated allowance	640		1,609		349		357		—		—		2,955
Total:
Recorded investment	22,806		42,000		15,067		11,663		—		—		91,536
Unpaid principal balance	21,164		41,204		14,789		11,578		—		—		88,735
Associated allowance	640		1,609		349		357		—		—		2,955
Recorded investment of loans on nonaccrual status(2)	$	3,588	$	24,582	$	4,180	$	6,133	$	—	$	—	$	38,483

⁽¹⁾  Impairment analysis was performed in the aggregate in consideration of similar risk characteristics of the assets and historical statistics on $64.1 million (70 percent) of impaired loans as of March 31, 2015, which resulted in a specific reserve of $1.6 million.

⁽²⁾  Includes $8.3 million of loans that are less than 90 days delinquent but which have not met Farmer Mac's performance criteria for returning to accrual status.

	As of December 31, 2014
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
Impaired Loans:
With no specific allowance:
Recorded investment	$	4,877	$	5,837	$	9,576	$	2,001	$	—	$	—	$	22,291
Unpaid principal balance	4,723		5,750		9,386		1,981		—		—		21,840
With a specific allowance:
Recorded investment(1)	10,753		33,690		5,979		11,350		—		—		61,772
Unpaid principal balance	10,042		33,393		5,897		11,265		—		—		60,597
Associated allowance	397		1,515		361		364		—		—		2,637
Total:
Recorded investment	15,630		39,527		15,555		13,351		—		—		84,063
Unpaid principal balance	14,765		39,143		15,283		13,246		—		—		82,437
Associated allowance	397		1,515		361		364		—		—		2,637
Recorded investment of loans on nonaccrual status(2)	$	5,168	$	14,413	$	4,438	$	6,133	$	—	$	—	$	30,152

⁽¹⁾  Impairment analysis was performed in the aggregate in consideration of similar risk characteristics of the assets and historical statistics on $54.4 million (65 percent) of impaired loans as of December 31, 2014, which resulted in a specific reserve of $1.2 million.

⁽²⁾  Includes $11.7 million of loans that are less than 90 days delinquent but which have not met Farmer Mac's performance criteria for returning to accrual status.

The following table presents by commodity type the average recorded investment and interest income recognized on impaired loans for the three months ended March 31, 2015 and 2014:

Table 5.6

	March 31, 2015
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
For the Three Months Ended:
Average recorded investment in impaired loans	$	19,218	$	40,764	$	15,311	$	12,507	$	—	$	—	$	87,800
Income recognized on impaired loans	282		83		148		58		—		—		571

	March 31, 2014
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
For the Three Months Ended:
Average recorded investment in impaired loans	$	23,772	$	45,008	$	13,776	$	12,538	$	—	$	60	$	95,154
Income recognized on impaired loans	170		194		76		122		—		—		562

Schedule of Certain Loans Acquired in Transfer Acquired During Period [Table Text Block]

The following tables present information related to Farmer Mac's acquisition of defaulted loans for the three months ended March 31, 2015 and 2014 and the outstanding balances and carrying amounts of all such loans as of March 31, 2015 and December 31, 2014:

Table 5.7

	For the Three Months Ended
	March 31, 2015		March 31, 2014
	(in thousands)
Unpaid principal balance at acquisition date:
Loans underlying LTSPCs	$	—	$	440
Loans underlying off-balance sheet Farmer Mac Guaranteed Securities	657		—
Total unpaid principal balance at acquisition date	657		440
Contractually required payments receivable	—		440
Impairment recognized subsequent to acquisition	52		52
Recovery/release of allowance for defaulted loans	121		2

	As of
	March 31, 2015		December 31, 2014
	(in thousands)
Outstanding balance	$	24,882	$	24,921
Carrying amount	22,087		22,149

Past Due Financing Receivables [Table Text Block]

Net credit losses and 90-day delinquencies as of and for the periods indicated for loans held and loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs are presented in the table below.  As of March 31, 2015, there were no delinquencies and no probable losses inherent in Farmer Mac's Rural Utilities loan portfolio and Farmer Mac had not experienced credit losses on any Rural Utilities loans.

Table 5.8

	90-Day Delinquencies(1)				Net Credit Losses
	As of				For the Three Months Ended
	March 31, 2015		December 31, 2014		March 31, 2015		March 31, 2014
	(in thousands)
On-balance sheet assets:
Farm & Ranch:
Loans	$	30,151	$	18,427	$	—	$	32
Total on-balance sheet	$	30,151	$	18,427	$	—	$	32
Off-balance sheet assets:
Farm & Ranch:
LTSPCs	$	1,950	$	490	$	—	$	—
Total off-balance sheet	$	1,950	$	490	$	—	$	—
Total	$	32,101	$	18,917	$	—	$	32

⁽¹⁾  Includes loans and loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days or more past due, in foreclosure, or in bankruptcy, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.

Of the $30.2 million and $18.4 million of on-balance sheet loans reported as 90-day delinquencies as of March 31, 2015 and December 31, 2014, respectively, $3.1 million and $1.8 million, respectively, were loans subject to "removal-of-account" provisions.

Financing Receivable Credit Quality Indicators [Table Text Block]

The following tables present credit quality indicators related to Farm & Ranch loans held and loans underlying LTSPCs and off-balance sheet Farm & Ranch Guaranteed Securities as of March 31, 2015 and December 31, 2014:  

Table 5.9

	As of March 31, 2015
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
Credit risk profile by internally assigned grade(1)
On-balance sheet:
Acceptable	$	1,629,509	$	361,875	$	373,623	$	57,363	$	25,800	$	1,360	$	2,449,530
Special mention(2)	12,987		4,181		28,855		632		—		—		46,655
Substandard(3)	18,706		39,354		6,178		10,489		—		—		74,727
Total on-balance sheet	$	1,661,202	$	405,410	$	408,656	$	68,484	$	25,800	$	1,360	$	2,570,912
Off-Balance Sheet:
Acceptable	$	1,243,212	$	484,527	$	772,974	$	94,477	$	64,987	$	5,650	$	2,665,827
Special mention(2)	14,018		11,633		21,548		1,333		—		8		48,540
Substandard(3)	10,544		7,518		18,556		5,123		19,580		648		61,969
Total off-balance sheet	$	1,267,774	$	503,678	$	813,078	$	100,933	$	84,567	$	6,306	$	2,776,336
Total Ending Balance:
Acceptable	$	2,872,721	$	846,402	$	1,146,597	$	151,840	$	90,787	$	7,010	$	5,115,357
Special mention(2)	27,005		15,814		50,403		1,965		—		8		95,195
Substandard(3)	29,250		46,872		24,734		15,612		19,580		648		136,696
Total	$	2,928,976	$	909,088	$	1,221,734	$	169,417	$	110,367	$	7,666	$	5,347,248
Commodity analysis of past due loans(1)
On-balance sheet	$	2,406	$	21,967	$	2,517	$	3,261	$	—	$	—	$	30,151
Off-balance sheet	1,411		—		497		42		—		—		1,950
90-days or more past due	$	3,817	$	21,967	$	3,014	$	3,303	$	—	$	—	$	32,101

⁽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 Special mention category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.  

⁽³⁾  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, 2014
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing		Other		Total
	(in thousands)
Credit risk profile by internally assigned grade(1)
On-balance sheet:
Acceptable	$	1,604,546	$	353,487	$	375,010	$	57,239	$	29,003	$	—	$	2,419,285
Special Mention(2)	16,814		6,030		31,039		612		—		—		54,495
Substandard(3)	12,307		35,904		6,571		11,660		—		—		66,442
Total on-balance sheet	$	1,633,667	$	395,421	$	412,620	$	69,511	$	29,003	$	—	$	2,540,222
Off-Balance Sheet
Acceptable	$	1,282,773	$	503,414	$	799,047	$	97,692	$	64,363	$	6,117	$	2,753,406
Special Mention(2)	13,603		12,150		30,281		1,351		—		8		57,393
Substandard(3)	11,223		9,210		18,670		5,400		20,994		656		66,153
Total off-balance sheet	$	1,307,599	$	524,774	$	847,998	$	104,443	$	85,357	$	6,781	$	2,876,952
Total Ending Balance:
Acceptable	$	2,887,319	$	856,901	$	1,174,057	$	154,931	$	93,366	$	6,117	$	5,172,691
Special Mention(2)	30,417		18,180		61,320		1,963		—		8		111,888
Substandard(3)	23,530		45,114		25,241		17,060		20,994		656		132,595
Total	$	2,941,266	$	920,195	$	1,260,618	$	173,954	$	114,360	$	6,781	$	5,417,174
Commodity analysis of past due loans(1)
On-balance sheet	$	4,175	$	6,869	$	4,555	$	2,828	$	—	$	—	$	18,427
Off-balance sheet	—		—		490		—		—		—		490
90-days or more past due	$	4,175	$	6,869	$	5,045	$	2,828	$	—	$	—	$	18,917

⁽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 Special mention category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.  

⁽³⁾  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 [Table Text Block]

Concentrations of Credit Risk

The following table sets forth the geographic and commodity/collateral diversification, as well as the range of original loan-to-value ratios, for all Farm & Ranch loans held and loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs as of March 31, 2015 and December 31, 2014:

Table 5.10

	As of
	March 31, 2015		December 31, 2014
	(in thousands)
By commodity/collateral type:
Crops	$	2,928,976	$	2,941,266
Permanent plantings	909,088		920,195
Livestock	1,221,734		1,260,618
Part-time farm	169,417		173,954
Ag. Storage and Processing	110,367		114,360
Other	7,666		6,781
Total	$	5,347,248	$	5,417,174
By geographic region(1):
Northwest	$	572,085	$	573,135
Southwest	1,701,128		1,753,606
Mid-North	1,859,293		1,873,041
Mid-South	633,545		627,615
Northeast	205,781		214,402
Southeast	375,416		375,375
Total	$	5,347,248	$	5,417,174
By original loan-to-value ratio:
0.00% to 40.00%	$	1,475,336	$	1,503,076
40.01% to 50.00%	1,194,757		1,191,804
50.01% to 60.00%	1,475,969		1,491,502
60.01% to 70.00%	1,065,814		1,091,759
70.01% to 80.00%	113,643		115,645
80.01% to 90.00%	21,729		23,388
Total	$	5,347,248	$	5,417,174

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

The original loan-to-value ratio is calculated by dividing the loan principal balance at the time of guarantee, purchase, or commitment by the appraised value at the date of loan origination or, when available, the updated appraised value at the time of guarantee, purchase, or commitment.  Current loan-to-value ratios may be higher or lower than the original loan-to-value ratios.