UNITED STATES | ||||||||||||||
SECURITIES AND EXCHANGE COMMISSION | ||||||||||||||
WASHINGTON, D.C. 20549 | ||||||||||||||
Form |
(Exact name of registrant as specified in its charter) |
Federally chartered instrumentality of the | |||||||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification number) | ||||||||||
(Address of principal executive offices) | (Zip code) |
(Registrant's telephone number, including area code) |
Title of each class | Trading symbol | Exchange on which registered | ||||||||||||
☒ | Accelerated filer | ☐ | |||||||||
Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
Emerging growth company |
PART I | ||||||||
As of | |||||||||||
June 30, 2020 | December 31, 2019 | ||||||||||
(in thousands) | |||||||||||
Assets: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Investment securities: | |||||||||||
Available-for-sale, at fair value (amortized cost of $ | |||||||||||
Held-to-maturity, at amortized cost | |||||||||||
Total Investment Securities | |||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||
Available-for-sale, at fair value (amortized cost of $ | |||||||||||
Held-to-maturity, at amortized cost | |||||||||||
Total Farmer Mac Guaranteed Securities | |||||||||||
USDA Securities: | |||||||||||
Trading, at fair value | |||||||||||
Held-to-maturity, at amortized cost | |||||||||||
Total USDA Securities | |||||||||||
Loans: | |||||||||||
Loans held for investment, at amortized cost | |||||||||||
Loans held for investment in consolidated trusts, at amortized cost | |||||||||||
Allowance for losses | ( | ( | |||||||||
Total loans, net of allowance | |||||||||||
Financial derivatives, at fair value | |||||||||||
Interest receivable (includes $ | |||||||||||
Guarantee and commitment fees receivable | |||||||||||
Deferred tax asset, net | |||||||||||
Prepaid expenses and other assets | |||||||||||
Total Assets | $ | $ | |||||||||
Liabilities and Equity: | |||||||||||
Liabilities: | |||||||||||
Notes payable | |||||||||||
Debt securities of consolidated trusts held by third parties | |||||||||||
Financial derivatives, at fair value | |||||||||||
Accrued interest payable (includes $ | |||||||||||
Guarantee and commitment obligation | |||||||||||
Accounts payable and accrued expenses | |||||||||||
Reserve for losses | |||||||||||
Total Liabilities | |||||||||||
Commitments and Contingencies (Note 6) | |||||||||||
Equity: | |||||||||||
Preferred stock: | |||||||||||
Series A, par value $ | |||||||||||
Series C, par value $ | |||||||||||
Series D, par value $ | |||||||||||
Series E, par value $ | |||||||||||
Common stock: | |||||||||||
Class A Voting, $ | |||||||||||
Class B Voting, $ | |||||||||||
Class C Non-Voting, $ | |||||||||||
Additional paid-in capital | |||||||||||
Accumulated other comprehensive loss, net of tax | ( | ( | |||||||||
Retained earnings | |||||||||||
Total Equity | |||||||||||
Total Liabilities and Equity | $ | $ |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||||
Interest income: | |||||||||||||||||||||||
Investments and cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
Farmer Mac Guaranteed Securities and USDA Securities | |||||||||||||||||||||||
Loans | |||||||||||||||||||||||
Total interest income | |||||||||||||||||||||||
Total interest expense | |||||||||||||||||||||||
Net interest income | |||||||||||||||||||||||
Provision for losses | ( | ( | ( | ( | |||||||||||||||||||
Net interest income after provision for losses | |||||||||||||||||||||||
Non-interest income/(expense): | |||||||||||||||||||||||
Guarantee and commitment fees | |||||||||||||||||||||||
Gains/(losses) on financial derivatives | ( | ||||||||||||||||||||||
(Losses)/gains on trading securities | ( | ||||||||||||||||||||||
Gains on sale of real estate owned | |||||||||||||||||||||||
Release of reserve for losses | |||||||||||||||||||||||
Other income | |||||||||||||||||||||||
Non-interest income | |||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Compensation and employee benefits | |||||||||||||||||||||||
General and administrative | |||||||||||||||||||||||
Regulatory fees | |||||||||||||||||||||||
Real estate owned operating costs, net | |||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||
Income before income taxes | |||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||
Net income attributable to Farmer Mac | |||||||||||||||||||||||
Preferred stock dividends | ( | ( | ( | ( | |||||||||||||||||||
Loss on retirement of preferred stock | ( | ( | |||||||||||||||||||||
Net income attributable to common stockholders | $ | $ | $ | $ | |||||||||||||||||||
Earnings per common share: | |||||||||||||||||||||||
Basic earnings per common share | $ | $ | $ | $ | |||||||||||||||||||
Diluted earnings per common share | $ | $ | $ | $ |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Other comprehensive income before taxes: | |||||||||||||||||||||||
Net unrealized gains/(losses) on available-for-sale securities | ( | ( | ( | ||||||||||||||||||||
Net changes in held-to-maturity securities | ( | ( | ( | ( | |||||||||||||||||||
Net unrealized losses on cash flow hedges | ( | ( | ( | ( | |||||||||||||||||||
Other comprehensive gain/(loss) before tax | ( | ( | ( | ||||||||||||||||||||
Income tax (expense)/benefit related to other comprehensive gain/(loss) | ( | ||||||||||||||||||||||
Other comprehensive gain/(loss) net of tax | ( | ( | ( | ||||||||||||||||||||
Comprehensive income/(loss) attributable to Farmer Mac | $ | $ | ( | $ | ( | $ |
Accumulated | |||||||||||||||||||||||||||||||||||||||||||||||
Additional | Other | ||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Paid-In | Comprehensive | Retained | Total | ||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Income/(Loss) | Earnings | Equity | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2019 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
— | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Balance as of January 1, 2020 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Cash dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of $ | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Issuance of Class C common stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Repurchase of Class C Common Stock | — | — | ( | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation cost | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2020 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Cash dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of $ | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Issuance of Series E preferred stock | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Issuance of Class C common stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation cost | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2020 | $ | $ | $ | $ | ( | $ | $ |
Accumulated | |||||||||||||||||||||||||||||||||||||||||||||||
Additional | Other | ||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Paid-In | Comprehensive | Retained | Total | ||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Income/(Loss) | Earnings | Equity | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2018 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
Net Income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Cash dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of $ | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Issuance of Class C Common Stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation cost | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2019 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Cash dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of $ | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Issuance of Series D Preferred Stock | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Redemption of Series B Preferred Stock | ( | ( | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Loss on retirement of preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Issuance of Class C Common Stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation cost | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2019 | $ | $ | $ | $ | ( | $ | $ |
For the Six Months Ended | |||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||
(in thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Net amortization of deferred gains, premiums, and discounts on loans, investments, Farmer Mac Guaranteed Securities, and USDA Securities | ( | ||||||||||
Amortization of debt premiums, discounts, and issuance costs | |||||||||||
Net change in fair value of trading securities, hedged assets, and financial derivatives | ( | ( | |||||||||
Gain on sale of real estate owned | ( | ||||||||||
Total provision for allowance for losses | |||||||||||
Excess tax benefits related to stock-based awards | ( | ||||||||||
Deferred income taxes | ( | ||||||||||
Stock-based compensation expense | |||||||||||
Proceeds from repayment of loans purchased as held for sale | |||||||||||
Net change in: | |||||||||||
Interest receivable | ( | ||||||||||
Guarantee and commitment fees receivable | |||||||||||
Other assets | ( | ( | |||||||||
Accrued interest payable | ( | ||||||||||
Other liabilities | ( | ||||||||||
Net cash used in operating activities | ( | ( | |||||||||
Cash flows from investing activities: | |||||||||||
Purchases of available-for-sale investment securities | ( | ( | |||||||||
Purchases of Farmer Mac Guaranteed Securities and USDA Securities | ( | ( | |||||||||
Purchases of loans held for investment | ( | ( | |||||||||
Purchases of defaulted loans | ( | ||||||||||
Proceeds from repayment of available-for-sale investment securities | |||||||||||
Proceeds from repayment of Farmer Mac Guaranteed Securities and USDA Securities | |||||||||||
Proceeds from repayment of loans purchased as held for investment | |||||||||||
Proceeds from sale of Farmer Mac Guaranteed Securities | |||||||||||
Proceeds from sale of real estate owned | |||||||||||
Net cash used in investing activities | ( | ( | |||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from issuance of discount notes | |||||||||||
Proceeds from issuance of medium-term notes | |||||||||||
Payments to redeem discount notes | ( | ( | |||||||||
Payments to redeem medium-term notes | ( | ( | |||||||||
Payments to third parties on debt securities of consolidated trusts | ( | ( | |||||||||
Proceeds from common stock issuance | |||||||||||
Retirement of Series B preferred stock | ( | ||||||||||
Proceeds from Series D preferred stock issuance, net of stock issuance costs | |||||||||||
Proceeds from Series E preferred stock issuance, net of stock issuance costs | |||||||||||
Tax payments related to share-based awards | ( | ( | |||||||||
Purchases of common stock | ( | ||||||||||
Dividends paid on common and preferred stock | ( | ( | |||||||||
Net cash provided by financing activities | |||||||||||
Net change in cash and cash equivalents | ( | ||||||||||
Cash and cash equivalents at beginning of period | |||||||||||
Cash and cash equivalents at end of period | $ | $ | |||||||||
Non-cash activity: | |||||||||||
Loans acquired and securitized as Farmer Mac Guaranteed Securities | |||||||||||
Consolidation of Farmer Mac Guaranteed Securities from off-balance sheet to loans held for investment in consolidated trusts and to debt securities of consolidated trusts held by third parties | |||||||||||
Reclassification of defaulted loans from loans held for investment in consolidated trusts to loans held for investment | |||||||||||
Maturity of investment security - not yet settled | ( | ||||||||||
Purchases of securities - traded, not yet settled |
Consolidation of Variable Interest Entities | |||||||||||||||||||||||
As of June 30, 2020 | |||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Corporate | Total | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
On-Balance Sheet: | |||||||||||||||||||||||
Consolidated VIEs: | |||||||||||||||||||||||
Loans held for investment in consolidated trusts, at amortized cost | $ | $ | $ | $ | |||||||||||||||||||
Debt securities of consolidated trusts held by third parties (1) | |||||||||||||||||||||||
Unconsolidated VIEs: | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||
Carrying value (2) | |||||||||||||||||||||||
Maximum exposure to loss (3) | |||||||||||||||||||||||
Investment securities: | |||||||||||||||||||||||
Carrying value (4) | |||||||||||||||||||||||
Maximum exposure to loss (3) (4) | |||||||||||||||||||||||
Off-Balance Sheet: | |||||||||||||||||||||||
Unconsolidated VIEs: | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||
Maximum exposure to loss (3) (5) |
Consolidation of Variable Interest Entities | |||||||||||||||||||||||
As of December 31, 2019 | |||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Corporate | Total | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
On-Balance Sheet: | |||||||||||||||||||||||
Consolidated VIEs: | |||||||||||||||||||||||
Loans held for investment in consolidated trusts, at amortized cost | $ | $ | $ | $ | |||||||||||||||||||
Debt securities of consolidated trusts held by third parties (1) | |||||||||||||||||||||||
Unconsolidated VIEs: | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||
Carrying value (2) | |||||||||||||||||||||||
Maximum exposure to loss (3) | |||||||||||||||||||||||
Investment securities: | |||||||||||||||||||||||
Carrying value (4) | |||||||||||||||||||||||
Maximum exposure to loss (3) (4) | |||||||||||||||||||||||
Off-Balance Sheet: | |||||||||||||||||||||||
Unconsolidated VIEs: | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||
Maximum exposure to loss (3) (5) |
For the Three Months Ended | |||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||||||||||||||||||||||||||
Net Income | Weighted-Average Shares | $ per Share | Net Income | Weighted-Average Shares | $ per Share | ||||||||||||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||||||||||||||||
Basic EPS | |||||||||||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Effect of dilutive securities(1) | |||||||||||||||||||||||||||||||||||
SARs and restricted stock | — | ( | — | ( | |||||||||||||||||||||||||||||||
Diluted EPS | $ | $ | $ | $ |
For the Six Months Ended | |||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||||||||||||||||||||||||||
Net Income | Weighted-Average Shares | $ per Share | Net Income | Weighted-Average Shares | $ per Share | ||||||||||||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||||||||||||||||
Basic EPS | |||||||||||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Effect of dilutive securities(1) | |||||||||||||||||||||||||||||||||||
SARs and restricted stock | — | ( | — | ( | |||||||||||||||||||||||||||||||
Diluted EPS | $ | $ | $ | $ |
As of June 30, 2020 | As of June 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
Available-for-Sale Securities | Held-to-Maturity Securities | Cash Flow Hedges | Total | Available-for-Sale Securities | Held-to-Maturity Securities | Cash Flow Hedges | Total | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Other comprehensive income/(loss) before reclassifications | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from AOCI | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Net comprehensive income/(loss) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Ending Balance | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Other comprehensive loss before reclassifications | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from AOCI | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Net comprehensive loss | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Ending Balance | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | ( |
For the Three Months Ended | |||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||||||||||||||||||||||||||
Before Tax | Provision (Benefit) | After Tax | Before Tax | Provision (Benefit) | After Tax | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||||||||||||||
Available-for-sale-securities: | |||||||||||||||||||||||||||||||||||
Unrealized holding gains/(losses) on available-for-sale securities | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(1) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Other income(2) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
Held-to-maturity securities: | |||||||||||||||||||||||||||||||||||
Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(3) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Total | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Cash flow hedges | |||||||||||||||||||||||||||||||||||
Unrealized losses on cash flow hedges | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(4) | ( | ( | ( | ||||||||||||||||||||||||||||||||
Total | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Other comprehensive income/(loss) | $ | $ | $ | $ | ( | $ | ( | $ | ( |
For the Six Months Ended | |||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||||||||||||||||||||||||||
Before Tax | Provision (Benefit) | After Tax | Before Tax | Provision (Benefit) | After Tax | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||||||||||||||
Available-for-sale-securities: | |||||||||||||||||||||||||||||||||||
Unrealized holding losses on available-for-sale securities | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(1) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Other income(2) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Total | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Held-to-maturity securities: | |||||||||||||||||||||||||||||||||||
Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(3) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Total | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Cash flow hedges | |||||||||||||||||||||||||||||||||||
Unrealized losses on cash flow hedges | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(4) | ( | ( | ( | ||||||||||||||||||||||||||||||||
Total | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Other comprehensive loss | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Standard | Description | Date of Adoption | Effect on Consolidated Financial Statements | ||||||||
ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments | This Update required entities to measure all expected credit losses for financial assets held at amortized cost at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts, as well as requiring entities to use forward-looking information to form their credit loss estimates. | January 1, 2020 | In first quarter 2020 Farmer Mac adopted the new guidance. The cumulative-effect adjustment to retained earnings as of January 1, 2020 reflected application of the new guidance and did not have a material effect on Farmer Mac's financial position, results of operations, or cash flows. For more information on the transition adjustment see Table 1.5 below. | ||||||||
ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities | The amendments in this Update shorten the amortization period for certain callable debt securities held at a premium by requiring the premium to be amortized to the earliest call date. There is no required accounting change for securities held at a discount in this Update. | January 1, 2020 | The adoption of this Update did not have a material effect on Farmer Mac's financial position, results of operations, or cash flows. | ||||||||
ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement | The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurements, including the consideration of costs and benefits. Certain disclosure requirements were either removed, modified, or added. | January 1, 2020 | The adoption of this Update did not have a material effect on Farmer Mac's financial position, results of operations, or cash flows. |
December 31, 2019 | Transition Adjustment | January 1, 2020 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Allowance: | ||||||||||||||||||||
Farm & Ranch: | ||||||||||||||||||||
Loans | $ | $ | ( | $ | ||||||||||||||||
Long-term standby purchase commitments and guarantees | ( | |||||||||||||||||||
Rural Utilities: | ||||||||||||||||||||
Loans | ||||||||||||||||||||
Long-term standby purchase commitments | ||||||||||||||||||||
Farmer Mac Guaranteed Securities: | ||||||||||||||||||||
AgVantage | ||||||||||||||||||||
Investment Securities | ||||||||||||||||||||
Total Allowance | $ | $ | $ | |||||||||||||||||
Retained Earnings | $ | $ | ( | $ |
Standard | Description | Date of Planned Adoption | Effect on Consolidated Financial Statements | ||||||||
ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting | The amendments in this Update provide optional guidance for a limited period of time to ease the potential burden in accounting for reference rate reform on financial reporting. They provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. | The amendments in this Update are effective for all entities as of March 12, 2020 through December 31, 2022. | Farmer Mac is currently evaluating the impact of the discontinuation of LIBOR on the consolidated financial statements and the applicability of the optional guidance provided by this Update. |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||
Amount Outstanding | Unamortized Premium/(Discount) | Amortized Cost(1) | Allowance for losses(2) | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Floating rate asset-backed securities | ( | ||||||||||||||||||||||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities | ( | ||||||||||||||||||||||||||||||||||||||||
Fixed rate GSE guaranteed mortgage-backed securities | |||||||||||||||||||||||||||||||||||||||||
Fixed rate U.S. Treasuries | ( | ||||||||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ( | |||||||||||||||||||||||||||||||||||||||
Held-to-maturity: | |||||||||||||||||||||||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities(3) | |||||||||||||||||||||||||||||||||||||||||
Total investment securities | $ | $ | $ | $ | ( | $ | $ | ( | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||
Amount Outstanding | Unamortized Premium/(Discount) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
Floating rate asset-backed securities | ( | ||||||||||||||||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities | ( | ||||||||||||||||||||||||||||||||||
Fixed rate GSE guaranteed mortgage-backed securities | |||||||||||||||||||||||||||||||||||
Fixed rate U.S. Treasuries | ( | ||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ||||||||||||||||||||||||||||||||||
Held-to-maturity: | |||||||||||||||||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities(1) | |||||||||||||||||||||||||||||||||||
Total investment securities | $ | $ | $ | $ | $ | ( | $ |
As of June 30, 2020 | |||||||||||||||||||||||
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 | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | ( | ||||||||||||||||||
Floating rate asset-backed securities | ( | ||||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities | ( | ( | |||||||||||||||||||||
Fixed rate U.S. Treasuries | ( | ||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Number of securities in loss position |
As of December 31, 2019 | |||||||||||||||||||||||
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 | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | ( | ||||||||||||||||||
Floating rate asset-backed securities | ( | ( | |||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities | ( | ( | |||||||||||||||||||||
Fixed rate U.S. Treasuries | ( | ||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Number of securities in loss position |
As of June 30, 2020 | |||||||||||||||||
Available-for-Sale Securities | |||||||||||||||||
Amortized Cost | Fair Value | Weighted- Average Yield | |||||||||||||||
(dollars in thousands) | |||||||||||||||||
Due within one year | $ | $ | |||||||||||||||
Due after one year through five years | |||||||||||||||||
Due after five years through ten years | |||||||||||||||||
Due after ten years | |||||||||||||||||
Total | $ | $ |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||
Unpaid Principal Balance | Unamortized Premium/(Discount) | Amortized Cost(1) | Allowance for losses(2) | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Held-to-maturity: | |||||||||||||||||||||||||||||||||||||||||
AgVantage | $ | $ | ( | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||
Farmer Mac Guaranteed USDA Securities | |||||||||||||||||||||||||||||||||||||||||
Total Farmer Mac Guaranteed Securities | ( | ||||||||||||||||||||||||||||||||||||||||
USDA Securities | ( | ||||||||||||||||||||||||||||||||||||||||
Total held-to-maturity | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||
AgVantage | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||
Trading: | |||||||||||||||||||||||||||||||||||||||||
USDA Securities(3) | $ | $ | $ | $ | $ | $ | ( | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||
Unpaid Principal Balance | Unamortized Premium/(Discount) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
Held-to-maturity: | |||||||||||||||||||||||||||||||||||
AgVantage | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Farmer Mac Guaranteed USDA Securities | |||||||||||||||||||||||||||||||||||
Total Farmer Mac Guaranteed Securities | ( | ( | |||||||||||||||||||||||||||||||||
USDA Securities | ( | ||||||||||||||||||||||||||||||||||
Total held-to-maturity | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||
AgVantage | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Trading: | |||||||||||||||||||||||||||||||||||
USDA Securities(1) | $ | $ | $ | $ | $ | ( | $ |
As of June 30, 2020 | |||||||||||||||||||||||
Held-to-Maturity and 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) | |||||||||||||||||||||||
Held-to-maturity: | |||||||||||||||||||||||
USDA Securities | $ | $ | $ | $ | ( | ||||||||||||||||||
Total held-to-maturity | $ | $ | $ | $ | ( | ||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
AgVantage | $ | $ | ( | $ | $ | ( |
As of December 31, 2019 | |||||||||||||||||||||||
Held-to-Maturity and 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) | |||||||||||||||||||||||
Held-to-maturity: | |||||||||||||||||||||||
AgVantage | $ | $ | $ | $ | ( | ||||||||||||||||||
USDA Securities | ( | ||||||||||||||||||||||
Total held-to-maturity | $ | $ | $ | $ | ( | ||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
AgVantage | $ | $ | ( | $ | $ | ( |
As of June 30, 2020 | |||||||||||||||||
Available-for-Sale Securities | |||||||||||||||||
Amortized Cost(1) | Fair Value | Weighted- Average Yield | |||||||||||||||
(dollars in thousands) | |||||||||||||||||
Due within one year | $ | $ | % | ||||||||||||||
Due after one year through five years | % | ||||||||||||||||
Due after five years through ten years | % | ||||||||||||||||
Due after ten years | % | ||||||||||||||||
Total | $ | $ | % |
As of June 30, 2020 | |||||||||||||||||
Held-to-Maturity Securities | |||||||||||||||||
Amortized Cost(1) | Fair Value | Weighted- Average Yield | |||||||||||||||
(dollars in thousands) | |||||||||||||||||
Due within one year | $ | $ | % | ||||||||||||||
Due after one year through five years | % | ||||||||||||||||
Due after five years through ten years | % | ||||||||||||||||
Due after ten years | % | ||||||||||||||||
Total | $ | $ | % |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||
Fair Value | Weighted- Average Pay Rate | Weighted- Average Receive Rate | Weighted- Average Forward Price | Weighted- Average Remaining Term (in years) | |||||||||||||||||||||||||||||||||||||
Notional Amount | Asset | (Liability) | |||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||
Fair value hedges: | |||||||||||||||||||||||||||||||||||||||||
Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
Pay fixed non-callable | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
Receive fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
Receive fixed callable | |||||||||||||||||||||||||||||||||||||||||
Cash flow hedges: | |||||||||||||||||||||||||||||||||||||||||
Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
No hedge designation: | |||||||||||||||||||||||||||||||||||||||||
Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
Receive fixed non-callable | |||||||||||||||||||||||||||||||||||||||||
Receive fixed callable | |||||||||||||||||||||||||||||||||||||||||
Basis swaps | ( | ||||||||||||||||||||||||||||||||||||||||
Treasury futures | ( | ||||||||||||||||||||||||||||||||||||||||
Credit valuation adjustment | |||||||||||||||||||||||||||||||||||||||||
Total financial derivatives | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
Collateral (held)/pledged | ( | ||||||||||||||||||||||||||||||||||||||||
Net amount | $ | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||
Fair Value | Weighted- Average Pay Rate | Weighted- Average Receive Rate | Weighted- Average Forward Price | Weighted- Average Remaining Term (in years) | |||||||||||||||||||||||||||||||||||||
Notional Amount | Asset | (Liability) | |||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||
Fair value hedges: | |||||||||||||||||||||||||||||||||||||||||
Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
Pay fixed non-callable | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
Receive fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
Receive fixed callable | ( | ||||||||||||||||||||||||||||||||||||||||
Cash flow hedges: | |||||||||||||||||||||||||||||||||||||||||
Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
No hedge designation: | |||||||||||||||||||||||||||||||||||||||||
Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
Receive fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
Receive fixed callable | ( | ||||||||||||||||||||||||||||||||||||||||
Basis swaps | ( | ||||||||||||||||||||||||||||||||||||||||
Treasury futures | ( | ||||||||||||||||||||||||||||||||||||||||
Credit valuation adjustment | |||||||||||||||||||||||||||||||||||||||||
Total financial derivatives | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
Collateral (held)/pledged | ( | ||||||||||||||||||||||||||||||||||||||||
Net amount | $ | $ |
For the Three Months Ended June 30, 2020 | |||||||||||||||||||||||||||||
Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
Interest Income Farmer Mac Guaranteed Securities and USDA Securities | Interest Income Loans | Total Interest Expense | Gains on financial derivatives | ||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Total amounts presented in the consolidated statement of operations | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | ( | ( | ( | ||||||||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||
Recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Expense recognized on cash flow hedges | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||
Gains on financial derivatives not designated in hedging relationships: | |||||||||||||||||||||||||||||
Gains on interest rate swaps | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest expense on interest rate swaps | ( | ( | |||||||||||||||||||||||||||
Treasury futures | ( | ( | |||||||||||||||||||||||||||
Gains on financial derivatives not designated in hedge relationships | $ | $ | $ | $ | $ |
For The Three Months Ended June 30, 2019 | |||||||||||||||||||||||||||||
Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
Interest Income Farmer Mac Guaranteed Securities and USDA Securities | Interest Income Loans | Total Interest Expense | Gains on financial derivatives | ||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Total amounts presented in the consolidated statement of operations: | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | ( | ( | ( | ||||||||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Expense recognized on cash flow hedges | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||
Gains on financial derivatives not designated in hedge relationships: | |||||||||||||||||||||||||||||
Gains on interest rate swaps | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest expense on interest rate swaps | ( | ( | |||||||||||||||||||||||||||
Treasury futures | ( | ( | |||||||||||||||||||||||||||
Gains on financial derivatives not designated in hedge relationships | $ | $ | $ | $ | $ |
For the Six Months Ended June 30, 2020 | |||||||||||||||||||||||||||||
Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
Interest Income Farmer Mac Guaranteed Securities and USDA Securities | Interest Income Loans | Total Interest Expense | Losses on financial derivatives | ||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Total amounts presented in the consolidated statement of operations | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | ( | ( | ( | ||||||||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships | $ | ( | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||
Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||
Recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Expense recognized on cash flow hedges | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||
(Losses)/gains on financial derivatives not designated in hedging relationships: | |||||||||||||||||||||||||||||
Gains on interest rate swaps | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest expense on interest rate swaps | ( | ( | |||||||||||||||||||||||||||
Treasury futures | ( | ( | |||||||||||||||||||||||||||
(Losses)/gains on financial derivatives not designated in hedge relationships | $ | $ | $ | $ | ( | $ | ( |
For The Six Months Ended June 30, 2019 | |||||||||||||||||||||||||||||
Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
Interest Income Farmer Mac Guaranteed Securities and USDA Securities | Interest Income Loans | Total Interest Expense | Gains on financial derivatives | ||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Total amounts presented in the consolidated statement of operations: | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | ( | ( | ( | ||||||||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Income/(expense) related to interest settlements on fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Gains/(losses) on fair value hedging relationships: | |||||||||||||||||||||||||||||
Recognized on derivatives | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
Recognized on hedged items | ( | ||||||||||||||||||||||||||||
Gains/(losses) on fair value hedging relationships | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Discount amortization recognized on hedged items | ( | ( | |||||||||||||||||||||||||||
Expense recognized on cash flow hedges | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||
Gains on financial derivatives not designated in hedge relationships: | |||||||||||||||||||||||||||||
Gains on interest rate swaps | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest expense on interest rate swaps | ( | ( | |||||||||||||||||||||||||||
Treasury futures | ( | ( | |||||||||||||||||||||||||||
Gains on financial derivatives not designated in hedge relationships | $ | $ | $ | $ | $ |
Hedged Items in Fair Value Relationship | |||||||||||||||||||||||
Carrying Amount of Hedged Assets/(Liabilities) | Cumulative Amount of Fair Value Hedging Adjustments included in the Carrying Amount of the Hedged Assets/(Liabilities) | ||||||||||||||||||||||
June 30, 2020 | December 31, 2019 | June 30, 2020 | December 31, 2019 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities, Available-for-Sale, at fair value | $ | $ | $ | $ | |||||||||||||||||||
Loans held for investment, at amortized cost(1) | |||||||||||||||||||||||
Notes Payable(2) | ( | ( | ( | ( |
June 30, 2020 | |||||||||||||||||
Gross Amount Recognized(1) | Counterparty Netting | Net Amount Presented in the Consolidated Balance Sheet | |||||||||||||||
(in thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Derivatives | |||||||||||||||||
Interest rate swap | $ | $ | $ | ||||||||||||||
Liabilities: | |||||||||||||||||
Derivatives | |||||||||||||||||
Interest rate swap | $ | $ | $ |
December 31, 2019 | |||||||||||||||||
Gross Amount Recognized(1) | Counterparty Netting | Net Amount Presented in the Consolidated Balance Sheet | |||||||||||||||
(in thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Derivatives | |||||||||||||||||
Interest rate swaps | $ | $ | $ | ||||||||||||||
Liabilities: | |||||||||||||||||
Derivatives | |||||||||||||||||
Interest rate swaps | $ | $ | $ |
As of June 30, 2020(1) | As of December 31, 2019(2) | ||||||||||||||||||||||||||||||||||
Unsecuritized | In Consolidated Trusts | Total | Unsecuritized | In Consolidated Trusts | Total | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
Farm & Ranch | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Rural Utilities | |||||||||||||||||||||||||||||||||||
Total unpaid principal balance(3) | |||||||||||||||||||||||||||||||||||
Unamortized premiums, discounts, fair value hedge basis adjustment, and other cost basis adjustments | |||||||||||||||||||||||||||||||||||
Total loans | |||||||||||||||||||||||||||||||||||
Allowance for losses | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Total loans, net of allowance | $ | $ | $ | $ | $ | $ |
June 30, 2020(1) | December 31, 2019(2) | ||||||||||
Allowance for Losses | Allowance for Losses | ||||||||||
(in thousands) | |||||||||||
Loans: | |||||||||||
Farm & Ranch | $ | $ | |||||||||
Rural Utilities | |||||||||||
Total | $ | $ |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, 2020(1) | June 30, 2019(2) | June 30, 2020(1) | June 30, 2019(2) | ||||||||||||||||||||
Allowance for Losses | Allowance for Losses | Allowance for Losses | Allowance for Losses | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Farm & Ranch: | |||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | |||||||||||||||||||
( | |||||||||||||||||||||||
Adjusted Beginning Balance | |||||||||||||||||||||||
(Release of)/provision for losses | ( | ( | |||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | |||||||||||||||||||
Ending Balance(3) | $ | $ | $ | $ | |||||||||||||||||||
Rural Utilities: | |||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | |||||||||||||||||||
Adjusted Beginning Balance | |||||||||||||||||||||||
Provision for losses | |||||||||||||||||||||||
Charge-offs | |||||||||||||||||||||||
Ending Balance(4) | $ | $ | $ | $ |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||
Accruing | |||||||||||||||||||||||||||||||||||||||||
Current(5) | 30-59 Days | 60-89 Days | 90 Days and Greater(2) | Total Past Due | Nonaccrual loans(3)(4) | Total Loans | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Loans(1): | |||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Rural Utilities | |||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||
Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Other | Total | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Ending Balance: | |||||||||||||||||||||||||||||||||||||||||
Collectively evaluated for impairment | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | |||||||||||||||||||||||||||||||||||||||||
Total Farm & Ranch loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Allowance for Losses: | |||||||||||||||||||||||||||||||||||||||||
Collectively evaluated for impairment | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | |||||||||||||||||||||||||||||||||||||||||
Total Farm & Ranch loans | $ | $ | $ | $ | $ | $ | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||
Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Other | Total | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Impaired Loans: | |||||||||||||||||||||||||||||||||||||||||
With no specific allowance: | |||||||||||||||||||||||||||||||||||||||||
Recorded investment | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Unpaid principal balance | |||||||||||||||||||||||||||||||||||||||||
With a specific allowance: | |||||||||||||||||||||||||||||||||||||||||
Recorded investment(1) | |||||||||||||||||||||||||||||||||||||||||
Unpaid principal balance | |||||||||||||||||||||||||||||||||||||||||
Associated allowance | |||||||||||||||||||||||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||||||||||||||
Recorded investment | |||||||||||||||||||||||||||||||||||||||||
Unpaid principal balance | |||||||||||||||||||||||||||||||||||||||||
Associated allowance | |||||||||||||||||||||||||||||||||||||||||
Recorded investment of loans on nonaccrual status(2) | $ | $ | $ | $ | $ | $ | $ |
June 30, 2019 | |||||||||||||||||||||||||||||||||||||||||
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 | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Income recognized on impaired loans | |||||||||||||||||||||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||||||||
Average recorded investment in impaired loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Income recognized on impaired loans |
90-Day Delinquencies(1) | Net Credit Losses | ||||||||||
As of | For the Six Months Ended | ||||||||||
December 31, 2019 | June 30, 2019 | ||||||||||
(in thousands) | |||||||||||
Farm & Ranch loans | $ | $ |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Farm & Ranch(1): | |||||||||||||||||||||||||||||||||||||||||||||||
Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Farm & Ranch net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Farm & Ranch net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Rural Utilities(1): | |||||||||||||||||||||||||||||||||||||||||||||||
Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Rural Utilities net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Rural Utilities net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||
Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Other | Total | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Internally Assigned Risk Rating(1) | |||||||||||||||||||||||||||||||||||||||||
Acceptable | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Commodity analysis of past due loans(1) | $ | $ | $ | $ | $ | $ | $ |
Outstanding Balance of Off-Balance Sheet Farmer Mac Guaranteed Securities | |||||||||||
As of June 30, 2020 | As of December 31, 2019 | ||||||||||
(in thousands) | |||||||||||
Farm & Ranch: | |||||||||||
Farmer Mac Guaranteed Securities | $ | $ | |||||||||
USDA Guarantees: | |||||||||||
Farmer Mac Guaranteed USDA Securities | |||||||||||
Institutional Credit: | |||||||||||
AgVantage Securities | |||||||||||
Total off-balance sheet Farmer Mac Guaranteed Securities | $ | $ |
For the Six Months Ended | |||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||
(in thousands) | |||||||||||
Proceeds from new securitizations | $ | $ | |||||||||
Guarantee fees received |
As of June 30, 2020 | As of December 31, 2019 | ||||||||||
(dollars in thousands) | |||||||||||
Guarantee and commitment obligation | $ | $ | |||||||||
Weighted average remaining maturity: | |||||||||||
Farmer Mac Guaranteed Securities | |||||||||||
AgVantage Securities |
As of June 30, 2020 | As of December 31, 2019 | ||||||||||
(dollars in thousands) | |||||||||||
Guarantee and commitment obligation(1) | $ | $ | |||||||||
Maximum principal amount | |||||||||||
Weighted-average remaining maturity |
June 30, 2020(1) | December 31, 2019(2) | ||||||||||
Reserve for Losses | Reserve for Losses | ||||||||||
(in thousands) | |||||||||||
Farm & Ranch: | |||||||||||
LTSPCs and Farmer Mac Guaranteed Securities | $ | $ | |||||||||
Rural Utilities | |||||||||||
LTSPCs | |||||||||||
Total | $ | $ |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, 2020(1) | June 30, 2019(2) | June 30, 2020(1) | June 30, 2019(2) | ||||||||||||||||||||
Reserve for Losses | Reserve for Losses | Reserve for Losses | Reserve for Losses | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Farm & Ranch: | |||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | |||||||||||||||||||
Cumulative effect adjustment from adoption of current expected credit loss standard | ( | ||||||||||||||||||||||
Adjusted Beginning Balance | |||||||||||||||||||||||
Release of losses | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Charge-offs | |||||||||||||||||||||||
Ending Balance | $ | $ | $ | $ | |||||||||||||||||||
Rural Utilities: | |||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | |||||||||||||||||||
Cumulative effect adjustment from adoption of current expected credit loss standard | |||||||||||||||||||||||
Adjusted Beginning Balance | |||||||||||||||||||||||
(Release of)/provision for losses | $ | ( | $ | $ | $ | ||||||||||||||||||
Charge-offs | |||||||||||||||||||||||
Ending Balance | $ | $ | $ | $ |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||
Current(2) | 30-59 Days | 60-89 Days | 90 Days and Greater(1) | Total Past Due | Total Loans | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
Farm and Ranch: | |||||||||||||||||||||||||||||||||||
LTSPCs and Farmer Mac Guaranteed Securities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Rural Utilities: | |||||||||||||||||||||||||||||||||||
LTSPCs | $ | $ | $ | $ | $ | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||
Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Other | Total | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Ending Balance: | |||||||||||||||||||||||||||||||||||||||||
Collectively evaluated for impairment: | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Individually evaluated for impairment: | |||||||||||||||||||||||||||||||||||||||||
Total Farm & Ranch | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Allowance for Losses: | |||||||||||||||||||||||||||||||||||||||||
Collectively evaluated for impairment: | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Individually evaluated for impairment: | |||||||||||||||||||||||||||||||||||||||||
Total Farm & Ranch | $ | $ | $ | $ | $ | $ | $ |
90-Day Delinquencies(1) | Net Credit Losses/(Recoveries) | ||||||||||
As of | For the Six Months Ended | ||||||||||
December 31, 2019 | June 30, 2019 | ||||||||||
(in thousands) | |||||||||||
Farm & Ranch LTSPCs and Farmer Mac Guaranteed Securities | $ | $ |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Farm & Ranch LTSPCs and Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(1) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Farm & Ranch net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Farm & Ranch net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Rural Utilities LTSPCs: | |||||||||||||||||||||||||||||||||||||||||||||||
Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(1) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Rural Utilities net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current period recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Current period Rural Utilities net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ |
As of December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||
Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Other | Total | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Internally Assigned Risk Rating(1) | |||||||||||||||||||||||||||||||||||||||||
Acceptable | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Commodity analysis of past due loans(1) | $ | $ | $ | $ | $ | $ | $ |
June 30, 2020 | |||||||||||||||||||||||
Outstanding as of June 30 | Average Outstanding During the First Six Months | ||||||||||||||||||||||
Amount | Weighted- Average Rate | Amount | Weighted- Average Rate | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Due within one year: | |||||||||||||||||||||||
Discount notes | $ | % | $ | % | |||||||||||||||||||
Medium-term notes | % | % | |||||||||||||||||||||
Current portion of medium-term notes | % | ||||||||||||||||||||||
Total due within one year | $ | % | |||||||||||||||||||||
Due after one year: | |||||||||||||||||||||||
Medium-term notes due in: | |||||||||||||||||||||||
Two years | $ | % | |||||||||||||||||||||
Three years | % | ||||||||||||||||||||||
Four years | % | ||||||||||||||||||||||
Five years | % | ||||||||||||||||||||||
Thereafter | % | ||||||||||||||||||||||
Total due after one year | % | ||||||||||||||||||||||
Total | $ | % |
December 31, 2019 | |||||||||||||||||||||||
Outstanding as of December 31 | Average Outstanding During the Year | ||||||||||||||||||||||
Amount | Weighted- Average Rate | Amount | Weighted- Average Rate | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Due within one year: | |||||||||||||||||||||||
Discount notes | $ | % | $ | % | |||||||||||||||||||
Medium-term notes | % | % | |||||||||||||||||||||
Current portion of medium-term notes | % | ||||||||||||||||||||||
Total due within one year | $ | % | |||||||||||||||||||||
Due after one year: | |||||||||||||||||||||||
Medium-term notes due in: | |||||||||||||||||||||||
Two years | $ | % | |||||||||||||||||||||
Three years | % | ||||||||||||||||||||||
Four years | % | ||||||||||||||||||||||
Five years | % | ||||||||||||||||||||||
Thereafter | % | ||||||||||||||||||||||
Total due after one year | % | ||||||||||||||||||||||
Total | $ | % |
Debt Callable in 2020 as of June 30, 2020, by Maturity | |||||||||||
Amount | Weighted-Average Rate | ||||||||||
(dollars in thousands) | |||||||||||
Maturity: | |||||||||||
2021 | $ | % | |||||||||
2022 | % | ||||||||||
2023 | % | ||||||||||
2024 | % | ||||||||||
Thereafter | % | ||||||||||
Total | $ | % |
Earliest Interest Rate Reset Date, or Debt Maturities, of Borrowings Outstanding | |||||||||||
Amount | Weighted-Average Rate | ||||||||||
(dollars in thousands) | |||||||||||
Debt with interest rate resets, or debt maturities in: | |||||||||||
2020 | $ | % | |||||||||
2021 | % | ||||||||||
2022 | % | ||||||||||
2023 | % | ||||||||||
2024 | % | ||||||||||
Thereafter | % | ||||||||||
Total | $ | % |
Assets and Liabilities Measured at Fair Value as of June 30, 2020 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3(1) | Total | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Recurring: | |||||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | |||||||||||||||||||
Floating rate asset-backed securities | |||||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities | |||||||||||||||||||||||
Fixed rate GSE guaranteed mortgage-backed securities | |||||||||||||||||||||||
Fixed rate U.S. Treasuries | |||||||||||||||||||||||
Total Investment Securities | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
AgVantage | |||||||||||||||||||||||
Total Farmer Mac Guaranteed Securities | |||||||||||||||||||||||
USDA Securities: | |||||||||||||||||||||||
Trading | |||||||||||||||||||||||
Total USDA Securities | |||||||||||||||||||||||
Financial derivatives | |||||||||||||||||||||||
Total Assets at fair value | $ | $ | $ | $ | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Financial derivatives | $ | $ | $ | $ | |||||||||||||||||||
Total Liabilities at fair value | $ | $ | $ | $ |
Assets and Liabilities Measured at Fair Value as of December 31, 2019 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3(1) | Total | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Recurring: | |||||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | |||||||||||||||||||
Floating rate asset-backed securities | |||||||||||||||||||||||
Floating rate Government/GSE guaranteed mortgage-backed securities | |||||||||||||||||||||||
Fixed rate GSE guaranteed mortgage-backed securities | |||||||||||||||||||||||
Fixed rate U.S. Treasuries | |||||||||||||||||||||||
Total available-for-sale | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
AgVantage | |||||||||||||||||||||||
Total Farmer Mac Guaranteed Securities | |||||||||||||||||||||||
USDA Securities: | |||||||||||||||||||||||
Trading | |||||||||||||||||||||||
Total USDA Securities | |||||||||||||||||||||||
Financial derivatives | |||||||||||||||||||||||
Total Assets at fair value | $ | $ | $ | $ | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Financial derivatives | $ | $ | $ | $ | |||||||||||||||||||
Total Liabilities at fair value | $ | $ | $ | $ |
Level 3 Assets and Liabilities Measured at Fair Value for the Three Months Ended June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning Balance | Purchases | Sales | Settlements | Allowance for losses | Realized and unrealized gains/(losses) included in Income | Unrealized gains/(losses) included in Other Comprehensive Income | Ending Balance | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Recurring: | |||||||||||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||||||||
AgVantage | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
USDA Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Trading | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Total USDA Securities | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Total Assets at fair value | $ | $ | $ | $ | ( | $ | ( | $ | $ | $ |
Level 3 Assets and Liabilities Measured at Fair Value for the Three Months Ended June 30, 2019 | |||||||||||||||||||||||||||||||||||||||||
Beginning Balance | Purchases | Sales | Settlements | Realized and unrealized gains/(losses) included in Income | Unrealized gains/(losses) included in Other Comprehensive Income | Ending Balance | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Recurring: | |||||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Total available-for-sale | |||||||||||||||||||||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||
AgVantage | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ( | |||||||||||||||||||||||||||||||||||||||
USDA Securities: | |||||||||||||||||||||||||||||||||||||||||
Available-for-sale | ( | ||||||||||||||||||||||||||||||||||||||||
Trading | ( | ||||||||||||||||||||||||||||||||||||||||
Total USDA Securities | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total Assets at fair value | $ | $ | $ | ( | $ | ( | $ | $ | ( | $ |
Level 3 Assets and Liabilities Measured at Fair Value for the Six Months Ended June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Beginning Balance | Purchases | Sales | Settlements | Allowance for Losses | Realized and unrealized gains/(losses) included in Income | Unrealized gains/(losses) included in Other Comprehensive Income | Ending Balance | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Recurring: | |||||||||||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||||||||
AgVantage | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
USDA Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Trading | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Total USDA Securities | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Total Assets at fair value | $ | $ | $ | $ | ( | $ | ( | $ | $ | ( | $ |
Level 3 Assets and Liabilities Measured at Fair Value for the Six Months Ended June 30, 2019 | |||||||||||||||||||||||||||||||||||||||||
Beginning Balance | Purchases | Sales | Settlements | Realized and unrealized gains/(losses) included in Income | Unrealized gains/(losses) included in Other Comprehensive Income | Ending Balance | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Recurring: | |||||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Total available-for-sale | |||||||||||||||||||||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | |||||||||||||||||||||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||
AgVantage | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total available-for-sale | ( | ( | |||||||||||||||||||||||||||||||||||||||
USDA Securities: | |||||||||||||||||||||||||||||||||||||||||
Available-for-sale | ( | ||||||||||||||||||||||||||||||||||||||||
Trading | ( | ||||||||||||||||||||||||||||||||||||||||
Total USDA Securities | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total Assets at fair value | $ | $ | $ | ( | $ | ( | $ | $ | ( | $ |
As of June 30, 2020 | ||||||||||||||||||||||||||
Financial Instruments | Fair Value | Valuation Technique | Unobservable Input | Range (Weighted-Average) | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Investment securities: | ||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | Indicative bids | Range of broker quotes | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | ||||||||||||||||||||||||||
AgVantage | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
USDA Securities | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
CPR |
As of December 31, 2019 | ||||||||||||||||||||||||||
Financial Instruments | Fair Value | Valuation Technique | Unobservable Input | Range (Weighted-Average) | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Investment securities: | ||||||||||||||||||||||||||
Floating rate auction-rate certificates backed by Government guaranteed student loans | $ | Indicative bids | Range of broker quotes | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities: | ||||||||||||||||||||||||||
AgVantage | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
USDA Securities | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
CPR |
As of June 30, 2020 | As of December 31, 2019 | ||||||||||||||||||||||
Fair Value | Carrying Amount | Fair Value | Carrying Amount | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
Investment securities | |||||||||||||||||||||||
Farmer Mac Guaranteed Securities | |||||||||||||||||||||||
USDA Securities | |||||||||||||||||||||||
Loans | |||||||||||||||||||||||
Financial derivatives | |||||||||||||||||||||||
Guarantee and commitment fees receivable | |||||||||||||||||||||||
Financial liabilities: | |||||||||||||||||||||||
Notes payable | |||||||||||||||||||||||
Debt securities of consolidated trusts held by third parties | |||||||||||||||||||||||
Financial derivatives | |||||||||||||||||||||||
Guarantee and commitment obligations |
Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | Corporate | Reconciling Adjustments | Consolidated Net Income | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Net interest income | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(1)(2)(3) | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Net effective spread | |||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(2) | ( | ||||||||||||||||||||||||||||||||||||||||
Other income/(expense)(3) | ( | ||||||||||||||||||||||||||||||||||||||||
Non-interest income/(loss) | ( | ||||||||||||||||||||||||||||||||||||||||
Provision for loan losses | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Provision for reserve for losses | |||||||||||||||||||||||||||||||||||||||||
Other non-interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Non-interest expense(4) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Core earnings before income taxes | ( | (5) | |||||||||||||||||||||||||||||||||||||||
Income tax (expense)/benefit | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Core earnings before preferred stock dividends | ( | (5) | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings/(losses) | $ | $ | $ | $ | $ | ( | $ | (5) | $ | ||||||||||||||||||||||||||||||||
Total assets at carrying value | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet program assets at principal balance | $ | $ | $ | $ | $ | $ | $ |
Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2019 | |||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | Corporate | Reconciling Adjustments | Consolidated Net Income | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Net interest income | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(1)(2)(3) | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Net effective spread | |||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(2) | ( | ||||||||||||||||||||||||||||||||||||||||
Other income/(expense)(3) | |||||||||||||||||||||||||||||||||||||||||
Non-interest income/(loss) | |||||||||||||||||||||||||||||||||||||||||
Provision for loan losses | ( | ( | |||||||||||||||||||||||||||||||||||||||
Release of reserve for losses | |||||||||||||||||||||||||||||||||||||||||
Other non-interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Non-interest expense(4) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Core earnings before income taxes | ( | (5) | |||||||||||||||||||||||||||||||||||||||
Income tax (expense)/benefit | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Core earnings before preferred stock dividends | ( | (5) | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | ( | ( | |||||||||||||||||||||||||||||||||||||||
Loss on retirement of preferred stock | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings/(losses) | $ | $ | $ | $ | $ | ( | $ | (5) | $ | ||||||||||||||||||||||||||||||||
Total assets at carrying value | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet program assets at principal balance | $ | $ | $ | $ | $ | $ | $ |
Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||
For the Six Months Ended June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | Corporate | Reconciling Adjustments | Consolidated Net Income | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Net interest income | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(1)(2)(3) | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Net effective spread | ( | ||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(2) | ( | ||||||||||||||||||||||||||||||||||||||||
Other income/(expense)(3) | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Non-interest income/(loss) | ( | ( | |||||||||||||||||||||||||||||||||||||||
Provision for loan losses | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Provision for reserve for losses | ( | ||||||||||||||||||||||||||||||||||||||||
Other non-interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Non-interest expense(4) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Core earnings before income taxes | ( | ( | (5) | ||||||||||||||||||||||||||||||||||||||
Income tax (expense)/benefit | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||
Core earnings before preferred stock dividends | ( | ( | (5) | ||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings/(losses) | $ | $ | $ | $ | $ | ( | $ | ( | (5) | $ | |||||||||||||||||||||||||||||||
Total assets at carrying value | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet program assets at principal balance | $ | $ | $ | $ | $ | $ | $ |
Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||
For the Six Months Ended June 30, 2019 | |||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | Corporate | Reconciling Adjustments | Consolidated Net Income | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
Net interest income | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(1)(2)(3) | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Net effective spread | |||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(2) | ( | ||||||||||||||||||||||||||||||||||||||||
Other income/(expense)(3) | |||||||||||||||||||||||||||||||||||||||||
Non-interest income/(loss) | |||||||||||||||||||||||||||||||||||||||||
Provision for loan losses | ( | ( | |||||||||||||||||||||||||||||||||||||||
Release of reserve for losses | |||||||||||||||||||||||||||||||||||||||||
Other non-interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Non-interest expense(4) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Core earnings before income taxes | ( | (5) | |||||||||||||||||||||||||||||||||||||||
Income tax (expense)/benefit | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Core earnings before preferred stock dividends | ( | (5) | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | ( | ( | |||||||||||||||||||||||||||||||||||||||
Loss on retirement of preferred stock | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings/(losses) | $ | $ | $ | $ | $ | ( | $ | (5) | $ | ||||||||||||||||||||||||||||||||
Total assets at carrying value | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet program assets at principal balance | $ | $ | $ | $ | $ | $ | $ |
For the Three Months Ended | |||||||||||||||||
June 30, 2020 | March 31, 2020 | June 30, 2019 | |||||||||||||||
(in thousands) | |||||||||||||||||
Net income attributable to common stockholders | $ | 31,687 | $ | 9,399 | $ | 28,304 | |||||||||||
Core earnings | 26,347 | 20,143 | 23,642 |
For the Three Months Ended | |||||||||||||||||
June 30, 2020 | March 31, 2020 | June 30, 2019 | |||||||||||||||
(in thousands) | |||||||||||||||||
Net interest income | $ | 48,348 | $ | 41,312 | $ | 43,054 | |||||||||||
Net interest yield % | 0.87 | % | 0.78 | % | 0.87 | % | |||||||||||
Net effective spread | 46,469 | 44,163 | 41,355 | ||||||||||||||
Net effective spread % | 0.89 | % | 0.89 | % | 0.91 | % |
As of | |||||||||||
June 30, 2020 | December 31, 2019 | ||||||||||
(in thousands) | |||||||||||
Core capital | $ | 915,613 | $ | 815,437 | |||||||
Capital in excess of minimum capital level required | 247,916 | 196,669 |
Farm & Ranch Line of Business | |||||||||||||||||||||||
On-Balance Sheet | Off-Balance Sheet | ||||||||||||||||||||||
Substandard Assets | % of Portfolio | Substandard Assets | % of Portfolio | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
June 30, 2020 | $ | 209,690 | 3.7 | % | $ | 95,174 | 4.0 | % | |||||||||||||||
March 31, 2020 | 211,376 | 3.9 | % | 100,964 | 4.1 | % | |||||||||||||||||
December 31, 2019 | 207,078 | 3.9 | % | 102,877 | 4.1 | % | |||||||||||||||||
Increase/(decrease) from prior quarter-ending | $ | (1,686) | (0.2) | % | $ | (5,790) | (0.1) | % | |||||||||||||||
Increase/(decrease) from prior year-ending | $ | 2,612 | (0.2) | % | $ | (7,703) | (0.1) | % |
Farm & Ranch Line of Business | |||||||||||||||||||||||
On-Balance Sheet | Off-Balance Sheet | ||||||||||||||||||||||
90-Day Delinquencies | % of Portfolio | 90-Day Delinquencies | % of Portfolio | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
June 30, 2020 | $ | 65,866 | 1.17 | % | $ | 2,816 | 0.12 | % | |||||||||||||||
March 31, 2020 | 75,117 | 1.40 | % | 4,605 | 0.19 | % | |||||||||||||||||
December 31, 2019 | 57,719 | 1.09 | % | 3,235 | 0.13 | % | |||||||||||||||||
Increase/(decrease) from prior quarter-ending | $ | (9,251) | (0.23) | % | $ | (1,789) | (0.07) | % | |||||||||||||||
Increase/(decrease) from prior year-ending | $ | 8,147 | 0.08 | % | $ | (419) | (0.01) | % |
Reconciliation of Net Income Attributable to Common Stockholders to Core Earnings | |||||||||||
For the Three Months Ended | |||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||
(in thousands, except per share amounts) | |||||||||||
Net income attributable to common stockholders | $ | 31,687 | $ | 28,304 | |||||||
Less reconciling items: | |||||||||||
Gains on undesignated financial derivatives due to fair value changes (see Table 14) | 8,700 | 10,485 | |||||||||
Losses on hedging activities due to fair value changes | (2,676) | (1,438) | |||||||||
Unrealized (losses)/gains on trading securities | (20) | 61 | |||||||||
Amortization of premiums/discounts and deferred gains on assets consolidated at fair value | 35 | (139) | |||||||||
Net effects of terminations or net settlements on financial derivatives | 720 | (592) | |||||||||
Issuance costs on the retirement of preferred stock | — | (1,956) | |||||||||
Income tax effect related to reconciling items | (1,419) | (1,759) | |||||||||
Sub-total | 5,340 | 4,662 | |||||||||
Core earnings | $ | 26,347 | $ | 23,642 | |||||||
Composition of Core Earnings: | |||||||||||
Revenues: | |||||||||||
Net effective spread(1) | $ | 46,469 | $ | 41,355 | |||||||
Guarantee and commitment fees(2) | 4,943 | 5,276 | |||||||||
Other(3) | 1,048 | 777 | |||||||||
Total revenues | 52,460 | 47,408 | |||||||||
Credit related expense (GAAP): | |||||||||||
Provision for losses | 51 | 420 | |||||||||
REO operating expenses | — | 64 | |||||||||
Total credit related expense | 51 | 484 | |||||||||
Operating expenses (GAAP): | |||||||||||
Compensation and employee benefits | 8,087 | 6,770 | |||||||||
General and administrative | 5,295 | 4,689 | |||||||||
Regulatory fees | 725 | 687 | |||||||||
Total operating expenses | 14,107 | 12,146 | |||||||||
Net earnings | 38,302 | 34,778 | |||||||||
Income tax expense(4) | 8,016 | 7,351 | |||||||||
Preferred stock dividends (GAAP) | 3,939 | 3,785 | |||||||||
Core earnings | $ | 26,347 | $ | 23,642 | |||||||
Core earnings per share: | |||||||||||
Basic | $ | 2.46 | $ | 2.21 | |||||||
Diluted | 2.45 | 2.20 | |||||||||
Weighted-average shares: | |||||||||||
Basic | 10,730 | 10,698 | |||||||||
Diluted | 10,776 | 10,770 |
Reconciliation of Net Income Attributable to Common Stockholders to Core Earnings | |||||||||||
For the Six Months Ended | |||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||
(in thousands, except per share amounts) | |||||||||||
Net income attributable to common stockholders | $ | 41,086 | $ | 50,178 | |||||||
Less reconciling items: | |||||||||||
Gains on undesignated financial derivatives due to fair value changes (see Table 14) | 2,216 | 12,725 | |||||||||
Losses on hedging activities due to fair value changes | (8,601) | (4,255) | |||||||||
Unrealized gains on trading securities | 86 | 105 | |||||||||
Amortization of premiums/discounts and deferred gains on assets consolidated at fair value | 38 | (155) | |||||||||
Net effects of terminations or net settlements on financial derivatives | (580) | (482) | |||||||||
Issuance costs on the retirement of preferred stock | — | (1,956) | |||||||||
Income tax effect related to reconciling items | 1,437 | (1,667) | |||||||||
Sub-total | (5,404) | 4,315 | |||||||||
Core earnings | $ | 46,490 | $ | 45,863 | |||||||
Composition of Core Earnings: | |||||||||||
Revenues: | |||||||||||
Net effective spread(1) | $ | 90,632 | $ | 80,156 | |||||||
Guarantee and commitment fees(2) | 9,839 | 10,695 | |||||||||
Other(3) | 1,722 | 1,286 | |||||||||
Total revenues | 102,193 | 92,137 | |||||||||
Credit related expense (GAAP): | |||||||||||
Provision for losses | 3,882 | 27 | |||||||||
REO operating expenses | — | 64 | |||||||||
Gains on sale of REO | (485) | — | |||||||||
Total credit related expense | 3,397 | 91 | |||||||||
Operating expenses (GAAP): | |||||||||||
Compensation and employee benefits | 18,214 | 14,376 | |||||||||
General and administrative | 10,658 | 9,285 | |||||||||
Regulatory fees | 1,450 | 1,375 | |||||||||
Total operating expenses | 30,322 | 25,036 | |||||||||
Net earnings | 68,474 | 67,010 | |||||||||
Income tax expense(4) | 14,614 | 14,066 | |||||||||
Preferred stock dividends (GAAP) | 7,370 | 7,081 | |||||||||
Core earnings | $ | 46,490 | $ | 45,863 | |||||||
Core earnings per share: | |||||||||||
Basic | $ | 4.34 | $ | 4.29 | |||||||
Diluted | 4.31 | 4.26 | |||||||||
Weighted-average shares: | |||||||||||
Basic | 10,721 | 10,684 | |||||||||
Diluted | 10,779 | 10,774 |
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, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||||
GAAP - Basic EPS | $ | 2.95 | $ | 2.65 | $ | 3.83 | $ | 4.70 | |||||||||||||||
Less reconciling items: | |||||||||||||||||||||||
Gains on undesignated financial derivatives due to fair value changes (see Table 14) | 0.81 | 0.98 | 0.21 | 1.19 | |||||||||||||||||||
Losses on hedging activities due to fair value changes | (0.25) | (0.13) | (0.80) | (0.39) | |||||||||||||||||||
Unrealized gains on trading securities | — | 0.01 | 0.01 | 0.01 | |||||||||||||||||||
Amortization of premiums/discounts and deferred gains on assets consolidated at fair value | — | (0.01) | — | (0.01) | |||||||||||||||||||
Net effects of terminations or net settlements on financial derivatives | 0.06 | (0.06) | (0.06) | (0.05) | |||||||||||||||||||
Issuance costs on the retirement of preferred stock | — | (0.18) | — | (0.18) | |||||||||||||||||||
Income tax effect related to reconciling items | (0.13) | (0.17) | 0.13 | (0.16) | |||||||||||||||||||
Sub-total | 0.49 | 0.44 | (0.51) | 0.41 | |||||||||||||||||||
Core Earnings - Basic EPS | $ | 2.46 | $ | 2.21 | $ | 4.34 | $ | 4.29 | |||||||||||||||
Shares used in per share calculation (GAAP and Core Earnings) | 10,730 | 10,698 | 10,721 | 10,684 |
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, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||||
GAAP - Diluted EPS | $ | 2.94 | $ | 2.63 | $ | 3.81 | $ | 4.66 | |||||||||||||||
Less reconciling items: | |||||||||||||||||||||||
Gains on undesignated financial derivatives due to fair value changes (see Table 14) | 0.81 | 0.96 | 0.21 | 1.17 | |||||||||||||||||||
Losses on hedging activities due to fair value changes | (0.25) | (0.14) | (0.80) | (0.40) | |||||||||||||||||||
Unrealized gains on trading securities | — | 0.01 | 0.01 | 0.01 | |||||||||||||||||||
Amortization of premiums/discounts and deferred gains on assets consolidated at fair value | — | (0.01) | — | (0.01) | |||||||||||||||||||
Net effects of terminations or net settlements on financial derivatives | 0.06 | (0.05) | (0.05) | (0.04) | |||||||||||||||||||
Issuance costs on the retirement of preferred stock | — | (0.18) | — | (0.18) | |||||||||||||||||||
Income tax effect related to reconciling items | (0.13) | (0.16) | 0.13 | (0.15) | |||||||||||||||||||
Sub-total | 0.49 | 0.43 | (0.50) | 0.40 | |||||||||||||||||||
Core Earnings - Diluted EPS | $ | 2.45 | $ | 2.20 | $ | 4.31 | $ | 4.26 | |||||||||||||||
Shares used in per share calculation (GAAP and Core Earnings) | 10,776 | 10,770 | 10,779 | 10,774 |
Non-GAAP Reconciling Items for (Losses)/Gains on Hedging Activities due to Fair Value Changes | |||||||||||||||||||||||
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Losses due to fair value changes (see Table 4.2) | $ | (2,381) | $ | (1,428) | $ | (8,062) | $ | (4,128) | |||||||||||||||
Initial cash payment (received) at inception of swap | (295) | (10) | (539) | (127) | |||||||||||||||||||
Losses on hedging activities due to fair value changes | $ | (2,676) | $ | (1,438) | $ | (8,601) | $ | (4,255) |
For the Six Months Ended | |||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | ||||||||||||||||||||||||||||||||||
Average Balance | Income/ Expense | Average Rate | Average Balance | Income/ Expense | Average Rate | ||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||||||||
Cash and investments | $ | 3,839,155 | $ | 28,140 | 1.47 | % | $ | 2,894,225 | $ | 38,863 | 2.69 | % | |||||||||||||||||||||||
Loans, Farmer Mac Guaranteed Securities and USDA Securities(1) | 16,464,280 | 220,035 | 2.67 | % | 14,853,973 | 251,338 | 3.38 | % | |||||||||||||||||||||||||||
Total interest-earning assets | 20,303,435 | 248,175 | 2.44 | % | 17,748,198 | 290,201 | 3.27 | % | |||||||||||||||||||||||||||
Funding: | |||||||||||||||||||||||||||||||||||
Notes payable due within one year | 3,341,975 | 18,122 | 1.08 | % | 3,667,842 | 44,848 | 2.45 | % | |||||||||||||||||||||||||||
Notes payable due after one year(2) | 16,676,078 | 143,897 | 1.73 | % | 13,421,483 | 165,479 | 2.47 | % | |||||||||||||||||||||||||||
Total interest-bearing liabilities(3) | 20,018,053 | 162,019 | 1.62 | % | 17,089,325 | 210,327 | 2.46 | % | |||||||||||||||||||||||||||
Net non-interest-bearing funding | 285,382 | — | 658,873 | — | |||||||||||||||||||||||||||||||
Total funding | 20,303,435 | 162,019 | 1.60 | % | 17,748,198 | 210,327 | 2.37 | % | |||||||||||||||||||||||||||
Net interest income/yield prior to consolidation of certain trusts | 20,303,435 | 86,156 | 0.85 | % | 17,748,198 | 79,874 | 0.90 | % | |||||||||||||||||||||||||||
Net effect of consolidated trusts(4) | 1,499,758 | 3,504 | 0.47 | % | 1,553,815 | 3,779 | 0.49 | % | |||||||||||||||||||||||||||
Net interest income/yield | $ | 21,803,193 | $ | 89,660 | 0.82 | % | $ | 19,302,013 | $ | 83,653 | 0.87 | % |
For the Six Months Ended June 30, 2020 Compared to Same Period in 2019 | |||||||||||||||||
Increase/(Decrease) Due to | |||||||||||||||||
Rate | Volume | Total | |||||||||||||||
(in thousands) | |||||||||||||||||
Income from interest-earning assets: | |||||||||||||||||
Cash and investments | $ | (21,001) | $ | 10,278 | $ | (10,723) | |||||||||||
Loans, Farmer Mac Guaranteed Securities and USDA Securities | (56,602) | 25,299 | (31,303) | ||||||||||||||
Total | (77,603) | 35,577 | (42,026) | ||||||||||||||
Expense from other interest-bearing liabilities | (80,236) | 31,928 | (48,308) | ||||||||||||||
Change in net interest income prior to consolidation of certain trusts(1) | $ | 2,633 | $ | 3,649 | $ | 6,282 |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||
Dollars | Yield | Dollars | Yield | Dollars | Yield | Dollars | Yield | ||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Net interest income/yield | $ | 48,348 | 0.87 | % | $ | 43,054 | 0.87 | % | $ | 89,660 | 0.82 | % | $ | 83,653 | 0.87 | % | |||||||||||||||||||||||||||||||
Net effects of consolidated trusts | (1,804) | 0.02 | % | (1,873) | 0.03 | % | (3,505) | 0.03 | % | (3,778) | 0.03 | % | |||||||||||||||||||||||||||||||||||
Expense related to undesignated financial derivatives | (2,413) | (0.05) | % | (1,557) | (0.03) | % | (3,603) | (0.04) | % | (4,102) | (0.05) | % | |||||||||||||||||||||||||||||||||||
Amortization of premiums/discounts on assets consolidated at fair value | (21) | — | % | 289 | 0.01 | % | (10) | — | % | 311 | — | % | |||||||||||||||||||||||||||||||||||
Amortization of losses due to terminations or net settlements on financial derivatives | (22) | — | % | 14 | — | % | 27 | — | % | (56) | — | % | |||||||||||||||||||||||||||||||||||
Fair value changes on fair value hedge relationships | 2,381 | 0.05 | % | 1,428 | 0.03 | % | 8,063 | 0.08 | % | 4,128 | 0.05 | % | |||||||||||||||||||||||||||||||||||
Net effective spread | $ | 46,469 | 0.89 | % | $ | 41,355 | 0.91 | % | $ | 90,632 | 0.89 | % | $ | 80,156 | 0.90 | % |
As of June 30, 2020 | As of June 30, 2019 | ||||||||||||||||||||||||||||||||||
Allowance for Losses | Reserve for Losses | Total Allowance for Losses | Allowance for Losses | Reserve for Losses | Total Allowance for Losses | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
For the Three Months Ended: | |||||||||||||||||||||||||||||||||||
Beginning balance | $ | 15,685 | $ | 3,420 | $ | 19,105 | $ | 6,753 | $ | 2,038 | $ | 8,791 | |||||||||||||||||||||||
Provision for/(release of) losses | 467 | (400) | 67 | 578 | (158) | 420 | |||||||||||||||||||||||||||||
Charge-offs | (394) | — | (394) | (67) | — | (67) | |||||||||||||||||||||||||||||
Ending Balance | $ | 15,758 | $ | 3,020 | $ | 18,778 | $ | 7,264 | $ | 1,880 | $ | 9,144 | |||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||
Beginning balance | $ | 10,454 | $ | 2,164 | $ | 12,618 | $ | 7,017 | $ | 2,167 | $ | 9,184 | |||||||||||||||||||||||
Cumulative effect adjustment from adoption of current expected credit loss standard | 1,793 | 863 | 2,656 | — | — | — | |||||||||||||||||||||||||||||
Adjusted beginning balance | 12,247 | 3,027 | 15,274 | 7,017 | 2,167 | 9,184 | |||||||||||||||||||||||||||||
Provision for/(release of) losses | 3,905 | (7) | 3,898 | 314 | (287) | 27 | |||||||||||||||||||||||||||||
Charge-offs | (394) | — | (394) | (67) | — | (67) | |||||||||||||||||||||||||||||
Ending balance | $ | 15,758 | $ | 3,020 | $ | 18,778 | $ | 7,264 | $ | 1,880 | $ | 9,144 |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | $ | % | June 30, 2020 | June 30, 2019 | $ | % | ||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees | 3,140 | 3,403 | $ | (263) | (8) | % | $ | 6,336 | $ | 6,916 | $ | (580) | (8) | % |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | $ | % | June 30, 2020 | June 30, 2019 | $ | % | ||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Gains due to fair value changes | $ | 8,700 | $ | 10,485 | $ | (1,785) | (17) | % | $ | 2,216 | $ | 12,725 | $ | (10,509) | (83) | % | |||||||||||||||||||||||||||||||
Accrual of contractual payments | (2,413) | (1,557) | (856) | 55 | % | (3,603) | (4,101) | 498 | (12) | % | |||||||||||||||||||||||||||||||||||||
Gains/(losses) due to terminations or net settlements | 236 | (15) | 251 | (1,673) | % | (1,388) | (71) | (1,317) | 1,855 | % | |||||||||||||||||||||||||||||||||||||
Gains/(losses) on financial derivatives | $ | 6,523 | $ | 8,913 | $ | (2,390) | (27) | % | $ | (2,775) | $ | 8,553 | $ | (11,328) | (132) | % |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | $ | % | June 30, 2020 | June 30, 2019 | $ | % | ||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Late fees | $ | 296 | $ | 154 | $ | 142 | 92 | % | $ | 887 | $ | 569 | $ | 318 | 56 | % | |||||||||||||||||||||||||||||||
Other | 933 | 201 | 732 | 364 | % | 1,158 | 279 | 879 | 315 | % | |||||||||||||||||||||||||||||||||||||
Total other income | $ | 1,229 | $ | 355 | $ | 874 | 246 | % | $ | 2,045 | $ | 848 | $ | 1,197 | 141 | % |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | $ | % | June 30, 2020 | June 30, 2019 | $ | % | ||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Compensation and employee benefits | 8,087 | $ | 6,770 | $ | 1,317 | 19 | % | $ | 18,214 | $ | 14,376 | $ | 3,838 | 27 | % | ||||||||||||||||||||||||||||||||
General and administrative | 5,295 | 4,689 | 606 | 13 | % | 10,658 | 9,285 | 1,373 | 15 | % | |||||||||||||||||||||||||||||||||||||
Regulatory fees | 725 | 687 | 38 | 6 | % | 1,450 | 1,375 | 75 | 5 | % | |||||||||||||||||||||||||||||||||||||
Total Operating Expenses | $ | 14,107 | $ | 12,146 | $ | 1,961 | 16 | % | $ | 30,322 | $ | 25,036 | $ | 5,286 | 21 | % |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | $ | % | June 30, 2020 | June 30, 2019 | $ | % | ||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | $ | 9,435 | $ | 9,111 | $ | 324 | 4 | % | $ | 13,176 | $ | 15,733 | $ | (2,557) | (16) | % | |||||||||||||||||||||||||||||||
Effective tax rate | 20.9 | % | 21.1 | % | (0.2) | % | 21.4 | % | 21.0 | % | 0.4 | % |
Net New Business Volume – Farmer Mac Loan Purchases, Guarantees, LTSPCs, and AgVantage Securities | |||||||||||||||||||||||
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
Net Growth/(Decrease) | Net Growth/(Decrease) | Net Growth/(Decrease) | Net Growth/(Decrease) | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Farm & Ranch: | |||||||||||||||||||||||
Loans | $ | 259,130 | $ | 143,361 | $ | 340,956 | $ | 165,936 | |||||||||||||||
LTSPCs | (52,874) | (67,594) | (100,055) | (108,556) | |||||||||||||||||||
USDA Guarantees: | |||||||||||||||||||||||
USDA Securities | 72,194 | 14,392 | 116,538 | (25,252) | |||||||||||||||||||
Farmer Mac Guaranteed USDA Securities | (40,594) | 22,223 | (58,907) | 31,026 | |||||||||||||||||||
Rural Utilities: | |||||||||||||||||||||||
Loans | 311,843 | 98,049 | 430,276 | 588,307 | |||||||||||||||||||
LTSPCs | (5,632) | (17,092) | (19,226) | (24,752) | |||||||||||||||||||
Institutional Credit: | |||||||||||||||||||||||
AgVantage securities | (41,271) | 46,483 | 214,584 | 395,501 | |||||||||||||||||||
Total purchases, guarantees, LTSPCs, and AgVantage securities | $ | 502,796 | $ | 239,822 | $ | 924,166 | $ | 1,022,210 |
For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Loans securitized and sold as Farm & Ranch Guaranteed Securities | $ | — | $ | 20,224 | $ | 28,050 | $ | 118,004 | |||||||||||||||
Farmer Mac Guaranteed USDA Securities | — | 29,419 | 28,050 | 48,347 | |||||||||||||||||||
AgVantage securities | 430,024 | 659,447 | 990,419 | 1,484,864 | |||||||||||||||||||
Total Farmer Mac Guaranteed Securities Issuances | $ | 430,024 | $ | 709,090 | $ | 1,046,519 | $ | 1,651,215 |
Lines of Business - Outstanding Business Volume | |||||||||||
As of June 30, 2020 | As of December 31, 2019 | ||||||||||
(in thousands) | |||||||||||
Farm & Ranch: | |||||||||||
Loans | $ | 4,181,422 | $ | 3,675,640 | |||||||
Loans held in trusts: | |||||||||||
Beneficial interests owned by third party investors | 1,436,090 | 1,600,917 | |||||||||
LTSPCs | 2,310,113 | 2,393,071 | |||||||||
Guaranteed Securities | 90,225 | 107,322 | |||||||||
USDA Guarantees: | |||||||||||
USDA Securities | 2,314,961 | 2,199,072 | |||||||||
Farmer Mac Guaranteed USDA Securities | 362,846 | 421,103 | |||||||||
Rural Utilities: | |||||||||||
Loans | 2,101,568 | 1,671,293 | |||||||||
LTSPCs(1) | 590,053 | 609,278 | |||||||||
Institutional Credit | |||||||||||
AgVantage Securities | 8,654,830 | 8,440,246 | |||||||||
Total | $ | 22,042,108 | $ | 21,117,942 |
Schedule of Principal Amortization as of June 30, 2020 | |||||||||||||||||||||||
Loans Held | Loans Underlying Off-Balance Sheet Farmer Mac Guaranteed Securities and LTSPCs | USDA Securities and Farmer Mac Guaranteed USDA Securities | Total | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
2020 | $ | 152,425 | $ | 106,391 | $ | 59,137 | $ | 317,953 | |||||||||||||||
2021 | 336,225 | 281,270 | 116,557 | 734,052 | |||||||||||||||||||
2022 | 330,914 | 224,825 | 117,421 | 673,160 | |||||||||||||||||||
2023 | 333,244 | 210,451 | 121,362 | 665,057 | |||||||||||||||||||
2024 | 328,160 | 176,133 | 119,630 | 623,923 | |||||||||||||||||||
Thereafter | 6,238,112 | 1,991,321 | 2,143,700 | 10,373,133 | |||||||||||||||||||
Total | $ | 7,719,080 | $ | 2,990,391 | $ | 2,677,807 | $ | 13,387,278 |
AgVantage Balances by Year of Maturity | |||||
As of | |||||
June 30, 2020 | |||||
(in thousands) | |||||
2020 | $ | 1,157,737 | |||
2021 | 1,692,298 | ||||
2022 | 1,582,868 | ||||
2023 | 964,527 | ||||
2024 | 828,108 | ||||
Thereafter(1) | 2,429,292 | ||||
Total | $ | 8,654,830 |
As of | Change | ||||||||||||||||||||||
June 30, 2020 | December 31, 2019 | $ | % | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash and cash equivalents | $ | 827,600 | $ | 604,381 | $ | 223,219 | 37 | % | |||||||||||||||
Investment securities, net of allowance | 3,512,410 | 3,004,875 | 507,535 | 17 | % | ||||||||||||||||||
Farmer Mac Guaranteed Securities, net of allowance | 9,039,105 | 8,590,476 | 448,629 | 5 | % | ||||||||||||||||||
USDA Securities | 2,347,709 | 2,241,073 | 106,636 | 5 | % | ||||||||||||||||||
Loans, net of allowance | 7,891,148 | 6,981,440 | 909,708 | 13 | % | ||||||||||||||||||
Other | 314,684 | 287,129 | 27,555 | 10 | % | ||||||||||||||||||
Total assets | $ | 23,932,656 | 23,932,656 | $ | 21,709,374 | $ | 2,223,282 | 10 | % | ||||||||||||||
Liabilities | |||||||||||||||||||||||
Notes Payable | 21,421,550 | 19,098,648 | 2,322,902 | 12 | % | ||||||||||||||||||
Other | 1,686,990 | 1,811,450 | (124,460) | (7) | % | ||||||||||||||||||
Total liabilities | $ | 23,108,540 | $ | 20,910,098 | $ | 2,198,442 | 2198442 | 11 | % | ||||||||||||||
Total equity | 824,116 | 799,276 | 24,840 | 3 | % | ||||||||||||||||||
Total liabilities and equity | $ | 23,932,656 | $ | 21,709,374 | $ | 2,223,282 | 10 | % |
Farm & Ranch COVID-19 Deferments Summary | ||||||||||||||||||||||||||
As of June 30, 2020(1) | ||||||||||||||||||||||||||
Unpaid Principal Balance | ||||||||||||||||||||||||||
Requested, but not yet Approved | Approved, but not yet Executed | Not Approved | Approved and Executed | |||||||||||||||||||||||
Farm & Ranch: | (in thousands) | |||||||||||||||||||||||||
On-balance sheet: | ||||||||||||||||||||||||||
Loans held for investment | $ | 2,547 | $ | 32,292 | $ | — | $ | 44,434 | ||||||||||||||||||
Loans held in consolidated trusts | 4,927 | 5,249 | — | 37,734 | ||||||||||||||||||||||
On-balance sheet total | $ | 7,474 | $ | 37,541 | $ | — | $ | 82,168 | ||||||||||||||||||
Off-balance sheet: | ||||||||||||||||||||||||||
LTSPCs | 2,716 | 49,696 | — | 109,475 | ||||||||||||||||||||||
Farm & Ranch Total | $ | 10,190 | $ | — | $ | 87,237 | $ | — | $ | 191,643 | ||||||||||||||||
USDA: | ||||||||||||||||||||||||||
USDA Securities | $ | 14,310 | $ | 10,378 | $ | 3,387 | $ | 48,005 | ||||||||||||||||||
Farmer Mac Guaranteed USDA Securities | 864 | 1,015 | 385 | 2,087 | ||||||||||||||||||||||
USDA Total | $ | 15,174 | $ | 11,393 | $ | 3,772 | $ | 50,092 | ||||||||||||||||||
Farm & Ranch and USDA Total Deferments | $ | 25,364 | $ | 98,630 | $ | 3,772 | $ | 241,735 | ||||||||||||||||||
Farm & Ranch Line of Business | 90-Day Delinquencies | Percentage | |||||||||||||||
(dollars in thousands) | |||||||||||||||||
As of: | |||||||||||||||||
June 30, 2020 | $ | 8,017,850 | $ | 68,682 | 0.86 | % | |||||||||||
March 31, 2020 | 7,811,594 | 79,722 | 1.02 | % | |||||||||||||
December 31, 2019 | 7,776,950 | 60,954 | 0.78 | % | |||||||||||||
September 30, 2019 | 7,393,728 | 59,691 | 0.81 | % | |||||||||||||
June 30, 2019 | 7,291,352 | 28,045 | 0.38 | % | |||||||||||||
March 31, 2019 | 7,215,585 | 52,366 | 0.73 | % | |||||||||||||
December 31, 2018 | 7,233,971 | 26,881 | 0.37 | % | |||||||||||||
September 30, 2018 | 7,072,018 | 37,545 | 0.53 | % | |||||||||||||
June 30, 2018 | 7,045,397 | 43,076 | 0.61 | % |
Farm & Ranch 90-Day Delinquencies as of June 30, 2020 | |||||||||||||||||||||||
Distribution of Farm & Ranch Line of Business | Farm & Ranch Line of Business | 90-Day Delinquencies(1) | Percentage | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
By year of origination: | |||||||||||||||||||||||
2010 and prior | 8 | % | $ | 670,088 | $ | 2,425 | 0.36 | % | |||||||||||||||
2011 | 2 | % | 150,148 | — | — | % | |||||||||||||||||
2012 | 5 | % | 370,422 | 966 | 0.26 | % | |||||||||||||||||
2013 | 7 | % | 577,515 | 1,961 | 0.34 | % | |||||||||||||||||
2014 | 6 | % | 462,788 | 4,185 | 0.90 | % | |||||||||||||||||
2015 | 8 | % | 633,114 | 6,688 | 1.06 | % | |||||||||||||||||
2016 | 12 | % | 964,303 | 27,263 | 2.83 | % | |||||||||||||||||
2017 | 13 | % | 1,062,965 | 22,877 | 2.15 | % | |||||||||||||||||
2018 | 11 | % | 920,834 | 2,317 | 0.25 | % | |||||||||||||||||
2019 | 16 | % | 1,249,509 | — | — | % | |||||||||||||||||
2020 | 12 | % | 956,164 | — | — | % | |||||||||||||||||
Total | 100 | % | $ | 8,017,850 | $ | 68,682 | 0.86 | % | |||||||||||||||
By geographic region(2): | |||||||||||||||||||||||
Northwest | 12 | % | $ | 982,409 | $ | 12,194 | 1.24 | % | |||||||||||||||
Southwest | 33 | % | 2,652,211 | 10,055 | 0.38 | % | |||||||||||||||||
Mid-North | 30 | % | 2,395,304 | 23,036 | 0.96 | % | |||||||||||||||||
Mid-South | 13 | % | 1,019,365 | 15,525 | 1.52 | % | |||||||||||||||||
Northeast | 4 | % | 354,724 | 3,936 | 1.11 | % | |||||||||||||||||
Southeast | 8 | % | 613,837 | 3,936 | 0.64 | % | |||||||||||||||||
Total | 100 | % | $ | 8,017,850 | $ | 68,682 | 0.86 | % | |||||||||||||||
By commodity/collateral type: | |||||||||||||||||||||||
Crops | 51 | % | $ | 4,107,839 | $ | 30,667 | 0.75 | % | |||||||||||||||
Permanent plantings | 23 | % | 1,827,060 | 9,050 | 0.50 | % | |||||||||||||||||
Livestock | 19 | % | 1,486,061 | 15,699 | 1.06 | % | |||||||||||||||||
Part-time farm | 6 | % | 502,738 | 401 | 0.08 | % | |||||||||||||||||
Ag. Storage and Processing | 1 | % | 86,979 | 12,865 | 14.79 | % | |||||||||||||||||
Other | — | 7,173 | — | — | % | ||||||||||||||||||
Total | 100 | % | $ | 8,017,850 | $ | 68,682 | 0.86 | % | |||||||||||||||
By original loan-to-value ratio: | |||||||||||||||||||||||
0.00% to 40.00% | 18 | % | $ | 1,413,947 | $ | 2,017 | 0.14 | % | |||||||||||||||
40.01% to 50.00% | 26 | % | 2,066,788 | 35,338 | 1.71 | % | |||||||||||||||||
50.01% to 60.00% | 34 | % | 2,757,099 | 28,409 | 1.03 | % | |||||||||||||||||
60.01% to 70.00% | 18 | % | 1,449,386 | 2,808 | 0.19 | % | |||||||||||||||||
70.01% to 80.00%(3) | 4 | % | 313,883 | — | — | % | |||||||||||||||||
80.01% to 90.00%(3) | — | % | 16,747 | 110 | 0.66 | % | |||||||||||||||||
Total | 100 | % | $ | 8,017,850 | $ | 68,682 | 0.86 | % | |||||||||||||||
By size of borrower exposure(4): | |||||||||||||||||||||||
Less than $1,000,000 | 31 | % | $ | 2,448,289 | $ | 10,433 | 0.43 | % | |||||||||||||||
$1,000,000 to $4,999,999 | 36 | % | 2,907,722 | 32,982 | 1.13 | % | |||||||||||||||||
$5,000,000 to $9,999,999 | 14 | % | 1,149,996 | 6,272 | 0.55 | % | |||||||||||||||||
$10,000,000 to $24,999,999 | 11 | % | 838,074 | 18,995 | 2.27 | % | |||||||||||||||||
$25,000,000 and greater | 8 | % | 673,769 | — | — | % | |||||||||||||||||
Total | 100 | % | $ | 8,017,850 | $ | 68,682 | 0.86 | % |
Farm & Ranch current loan-to-value ratio by internally assigned risk rating as of June 30, 2020 | |||||||||||||||||||||||
Acceptable | Special Mention | Substandard | Total | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Current loan-to-value ratio(1): | |||||||||||||||||||||||
0.00% to 40.00% | $ | 2,512,711 | $ | 98,178 | $ | 96,330 | $ | 2,707,219 | |||||||||||||||
40.01% to 50.00% | 1,989,690 | 129,814 | 83,954 | 2,203,458 | |||||||||||||||||||
50.01% to 60.00% | 1,633,872 | 102,664 | 73,391 | 1,809,927 | |||||||||||||||||||
60.01% to 70.00% | 890,407 | 80,917 | 29,662 | 1,000,986 | |||||||||||||||||||
70.01% to 80.00% | 217,471 | 35,690 | 6,787 | 259,948 | |||||||||||||||||||
80.01% and greater | 17,883 | 3,689 | 14,740 | 36,312 | |||||||||||||||||||
Total | $ | 7,262,034 | $ | 450,952 | $ | 304,864 | $ | 8,017,850 |
Farm & Ranch Credit Losses Relative to Cumulative | |||||||||||||||||
Original Loans, Guarantees, and LTSPCs as of June 30, 2020 | |||||||||||||||||
Cumulative Original Loans, Guarantees and LTSPCs | Cumulative Net Credit Losses/(Recoveries) | Cumulative Loss Rate | |||||||||||||||
(dollars in thousands) | |||||||||||||||||
By year of origination: | |||||||||||||||||
2010 and prior | $ | 15,329,678 | $ | 30,103 | 0.20 | % | |||||||||||
2011 | 780,402 | 3,661 | 0.47 | % | |||||||||||||
2012 | 1,159,716 | — | — | % | |||||||||||||
2013 | 1,450,157 | — | — | % | |||||||||||||
2014 | 1,026,726 | — | — | % | |||||||||||||
2015 | 1,183,420 | (516) | (0.04) | % | |||||||||||||
2016 | 1,478,669 | — | — | % | |||||||||||||
2017 | 1,553,646 | — | — | % | |||||||||||||
2018 | 1,267,020 | — | — | % | |||||||||||||
2019 | 1,461,128 | — | — | % | |||||||||||||
2020 | 1,007,172 | — | % | ||||||||||||||
Total | $ | 27,697,734 | $ | 33,248 | 0.12 | % | |||||||||||
By geographic region(1): | |||||||||||||||||
Northwest | $ | 3,611,959 | $ | 11,191 | 0.31 | % | |||||||||||
Southwest | 9,774,321 | 8,520 | 0.09 | % | |||||||||||||
Mid-North | 6,962,016 | 12,855 | 0.18 | % | |||||||||||||
Mid-South | 3,366,198 | (613) | (0.02) | % | |||||||||||||
Northeast | 1,562,479 | 323 | 0.02 | % | |||||||||||||
Southeast | 2,420,761 | 972 | 0.04 | % | |||||||||||||
Total | $ | 27,697,734 | $ | 33,248 | 0.12 | % | |||||||||||
By commodity/collateral type: | |||||||||||||||||
Crops | $ | 12,739,384 | $ | 2,887 | 0.02 | % | |||||||||||
Permanent plantings | 6,172,827 | 9,762 | 0.16 | % | |||||||||||||
Livestock | 6,299,930 | 3,836 | 0.06 | % | |||||||||||||
Part-time farm | 1,589,997 | 1,090 | 0.07 | % | |||||||||||||
Ag. Storage and Processing | 740,551 | 15,673 | 2.12 | % | |||||||||||||
Other | 155,045 | — | — | % | |||||||||||||
Total | $ | 27,697,734 | $ | 33,248 | 0.12 | % |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||
Farm & Ranch Concentrations by Commodity Type within Geographic Region | |||||||||||||||||||||||||||||||||||||||||
Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Other | Total | |||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||
By geographic region(1): | |||||||||||||||||||||||||||||||||||||||||
Northwest | $ | 454,289 | $ | 168,634 | $ | 274,876 | $ | 79,462 | $ | 5,089 | $ | 59 | $ | 982,409 | |||||||||||||||||||||||||||
5.7 | % | 2.1 | % | 3.4 | % | 1.0 | % | 0.1 | % | — | % | 12.3 | % | ||||||||||||||||||||||||||||
Southwest | 614,432 | 1,367,620 | 519,738 | 98,387 | 47,541 | 4,493 | 2,652,211 | ||||||||||||||||||||||||||||||||||
7.7 | % | 17.1 | % | 6.5 | % | 1.2 | % | 0.6 | % | 0.1 | % | 33.2 | % | ||||||||||||||||||||||||||||
Mid-North | 2,027,533 | 11,542 | 210,861 | 124,673 | 18,522 | 2,173 | 2,395,304 | ||||||||||||||||||||||||||||||||||
25.3 | % | 0.1 | % | 2.6 | % | 1.6 | % | 0.2 | % | — | % | 29.8 | % | ||||||||||||||||||||||||||||
Mid-South | 622,465 | 44,791 | 286,076 | 58,831 | 7,179 | 23 | 1,019,365 | ||||||||||||||||||||||||||||||||||
7.7 | % | 0.6 | % | 3.6 | % | 0.7 | % | 0.1 | % | — | % | 12.7 | % | ||||||||||||||||||||||||||||
Northeast | 154,876 | 59,872 | 64,852 | 71,520 | 3,604 | — | 354,724 | ||||||||||||||||||||||||||||||||||
1.9 | % | 0.7 | % | 0.8 | % | 0.9 | % | — | % | — | % | 4.3 | % | ||||||||||||||||||||||||||||
Southeast | 234,244 | 174,601 | 129,658 | 69,865 | 5,044 | 425 | 613,837 | ||||||||||||||||||||||||||||||||||
2.9 | % | 2.2 | % | 1.6 | % | 0.9 | % | 0.1 | % | — | % | 7.7 | % | ||||||||||||||||||||||||||||
Total | $ | 4,107,839 | $ | 1,827,060 | $ | 1,486,061 | $ | 502,738 | $ | 86,979 | $ | 7,173 | $ | 8,017,850 | |||||||||||||||||||||||||||
51.2 | % | 22.8 | % | 18.5 | % | 6.3 | % | 1.1 | % | 0.1 | % | 100.0 | % |
As of June 30, 2020 | |||||||||||||||||||||||||||||||||||
Farm & Ranch Cumulative Credit Losses by Origination Year and Commodity Type | |||||||||||||||||||||||||||||||||||
Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Total | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||
By year of origination: | |||||||||||||||||||||||||||||||||||
2010 and prior | $ | 3,427 | $ | 9,762 | $ | 3,836 | $ | 1,066 | $ | 12,012 | $ | 30,103 | |||||||||||||||||||||||
2011 | — | — | — | — | 3,661 | 3,661 | |||||||||||||||||||||||||||||
2012 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
2013 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
2014 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
2015 | (540) | — | — | 24 | — | (516) | |||||||||||||||||||||||||||||
2016 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
2017 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
2018 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
2019 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
2020 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Total | $ | 2,887 | $ | 9,762 | $ | 3,836 | $ | 1,090 | $ | 15,673 | $ | 33,248 |
Rural Utilities portfolio by internally assigned risk rating as of June 30, 2020 | |||||||||||||||||||||||
Acceptable | Special Mention | Substandard | Total | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Distribution Cooperative | $ | 2,098,958 | $ | — | $ | 5,014 | $ | 2,103,972 | |||||||||||||||
G&T Cooperative | 568,087 | — | — | 568,087 | |||||||||||||||||||
Renewable Energy | 19,562 | — | — | 19,562 | |||||||||||||||||||
Rural Utilities Total | $ | 2,686,607 | $ | — | $ | 5,014 | $ | 2,691,621 |
As of June 30, 2020 | As of December 31, 2019 | |||||||||||||||||||||||||||||||||||||
Counterparty | Balance | Credit Rating | Required Collateralization | Balance | Credit Rating | Required Collateralization | ||||||||||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||||||||||
AgVantage: | ||||||||||||||||||||||||||||||||||||||
CFC | $ | 3,062,635 | A | 100% | $ | 2,949,500 | A | 100% | ||||||||||||||||||||||||||||||
MetLife | 2,550,000 | AA- | 103% | 2,550,000 | AA- | 103% | ||||||||||||||||||||||||||||||||
Rabo AgriFinance | 2,275,000 | None | 110% | 2,225,000 | None | 110% | ||||||||||||||||||||||||||||||||
Other(1) | 494,190 | None | 106% to 125% | 436,041 | None | 106% to 125% | ||||||||||||||||||||||||||||||||
Farm Equity AgVantage(2) | 273,005 | None | 110% | 279,705 | None | 110% | ||||||||||||||||||||||||||||||||
Total outstanding | $ | 8,654,830 | $ | 8,440,246 |
Percentage Change in MVE from Base Case | ||||||||||||||
Interest Rate Scenario(1) | As of June 30, 2020 | As of December 31, 2019 | ||||||||||||
+100 basis points | 7.0 | % | 2.7 | % | ||||||||||
-100 basis points | (0.5) | % | (8.4) | % |
Percentage Change in NES from Base Case | ||||||||||||||
Interest Rate Scenario(1) | As of June 30, 2020 | As of December 31, 2019 | ||||||||||||
+100 basis points | 4.0 | % | 0.8 | % | ||||||||||
-100 basis points | (0.3) | % | 0.1 | % |
As of June 30, 2020 | As of December 31, 2019 | ||||||||||
(in thousands) | |||||||||||
Cash and cash equivalents | $ | 827,600 | $ | 604,381 | |||||||
Investment securities: | |||||||||||
Guaranteed by U.S. Government and its agencies | 1,816,385 | 1,842,640 | |||||||||
Guaranteed by GSEs | 1,677,742 | 1,143,323 | |||||||||
Asset-backed securities | 18,321 | 18,912 | |||||||||
Total | $ | 4,340,048 | $ | 3,609,256 |
New Business Volume | |||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | ||||||||||||||||||||||||||||||||||||||
Loans | LTSPCs | USDA Securities | Loans | LTSPCs | AgVantage | Total | |||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||
For the quarter ended: | |||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | $ | 609,284 | $ | 85,390 | $ | 224,016 | $ | 339,366 | $ | 19,500 | $ | 430,024 | $ | 1,707,580 | |||||||||||||||||||||||||||
March 31, 2020 | 401,853 | 73,674 | 147,906 | 152,668 | — | 560,395 | 1,336,496 | ||||||||||||||||||||||||||||||||||
December 31, 2019 | 602,750 | 65,614 | 143,565 | 102,900 | — | 371,075 | 1,285,904 | ||||||||||||||||||||||||||||||||||
September 30, 2019 | 309,805 | 125,022 | 113,664 | 117,279 | — | 402,611 | 1,068,381 | ||||||||||||||||||||||||||||||||||
June 30, 2019 | 248,152 | 57,321 | 118,335 | 105,000 | — | 659,447 | 1,188,255 | ||||||||||||||||||||||||||||||||||
March 31, 2019 | 203,156 | 91,215 | 57,223 | 546,198 | — | 825,417 | 1,723,209 | ||||||||||||||||||||||||||||||||||
December 31, 2018 | 285,008 | 80,840 | 90,297 | 3,000 | — | 585,814 | 1,044,959 | ||||||||||||||||||||||||||||||||||
September 30, 2018 | 192,628 | 64,100 | 116,339 | — | — | 1,085,953 | 1,459,020 | ||||||||||||||||||||||||||||||||||
June 30, 2018 | 224,101 | 126,066 | 129,960 | — | — | 825,203 | 1,305,330 | ||||||||||||||||||||||||||||||||||
For the year ended: | |||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | $ | 1,363,863 | $ | 339,172 | $ | 432,787 | $ | 871,377 | — | $ | 2,258,550 | $ | 5,265,749 | ||||||||||||||||||||||||||||
December 31, 2018 | 960,848 | 430,071 | 460,121 | 11,645 | — | 3,310,307 | 5,172,992 |
Repayments of Assets by Line of Business | |||||||||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | ||||||||||||||||||||||||||||||||||||||||||||
Loans | Guaranteed Securities | LTSPCs | USDA Securities | Loans | LTSPCs | AgVantage | Total | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
For the quarter ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Scheduled | $ | 101,264 | $ | 3,043 | $ | 39,010 | $ | 37,879 | $ | 23,589 | $ | 25,132 | $ | 471,295 | $ | 701,212 | |||||||||||||||||||||||||||||||
Unscheduled | 248,890 | 4,034 | 92,177 | 154,536 | 3,935 | — | — | 503,572 | |||||||||||||||||||||||||||||||||||||||
June 30, 2020 | $ | 350,154 | $ | 7,077 | $ | 131,187 | $ | 192,415 | $ | 27,524 | $ | 25,132 | $ | 471,295 | $ | 1,204,784 | |||||||||||||||||||||||||||||||
Scheduled | $ | 128,768 | $ | 6,132 | $ | 50,393 | $ | 43,069 | $ | 34,235 | $ | 13,593 | $ | 304,540 | $ | 580,730 | |||||||||||||||||||||||||||||||
Unscheduled | 191,260 | 3,888 | 60,442 | 78,806 | — | — | — | 334,396 | |||||||||||||||||||||||||||||||||||||||
March 31, 2020 | $ | 320,028 | $ | 10,020 | $ | 110,835 | $ | 121,875 | $ | 34,235 | $ | 13,593 | $ | 304,540 | $ | 915,126 | |||||||||||||||||||||||||||||||
Scheduled | $ | 57,488 | $ | 4,737 | $ | 39,878 | $ | 25,142 | $ | 10,317 | $ | 10,551 | $ | 656,095 | $ | 804,208 | |||||||||||||||||||||||||||||||
Unscheduled | 105,671 | 3,247 | 74,121 | 66,011 | 34,063 | — | 13,000 | 296,113 | |||||||||||||||||||||||||||||||||||||||
December 31, 2019 | $ | 163,159 | $ | 7,984 | $ | 113,999 | $ | 91,153 | $ | 44,380 | $ | 10,551 | $ | 669,095 | $ | 1,100,321 | |||||||||||||||||||||||||||||||
Scheduled | $ | 97,421 | $ | 3,095 | $ | 22,713 | $ | 27,853 | $ | 31,656 | $ | 8,692 | $ | 441,575 | $ | 633,005 | |||||||||||||||||||||||||||||||
Unscheduled | 129,676 | 2,663 | 76,883 | 39,442 | — | — | 1,088 | 249,752 | |||||||||||||||||||||||||||||||||||||||
September 30, 2019 | $ | 227,097 | $ | 5,758 | $ | 99,596 | $ | 67,295 | $ | 31,656 | $ | 8,692 | $ | 442,663 | $ | 882,757 | |||||||||||||||||||||||||||||||
Scheduled | $ | 39,879 | $ | 3,758 | $ | 58,779 | $ | 38,676 | $ | 6,951 | $ | 17,092 | $ | 612,964 | $ | 778,099 | |||||||||||||||||||||||||||||||
Unscheduled | 64,912 | 3,399 | 58,979 | 43,044 | — | — | — | 170,334 | |||||||||||||||||||||||||||||||||||||||
June 30, 2019 | $ | 104,791 | $ | 7,157 | $ | 117,758 | $ | 81,720 | $ | 6,951 | $ | 17,092 | $ | 612,964 | $ | 948,433 | |||||||||||||||||||||||||||||||
Scheduled | $ | 112,973 | $ | 5,843 | $ | 74,054 | $ | 41,266 | $ | 31,492 | $ | 7,660 | $ | 470,812 | $ | 744,100 | |||||||||||||||||||||||||||||||
Unscheduled | 67,608 | 1,798 | 50,482 | 46,798 | 24,448 | — | 5,587 | 196,721 | |||||||||||||||||||||||||||||||||||||||
March 31, 2019 | $ | 180,581 | $ | 7,641 | $ | 124,536 | $ | 88,064 | $ | 55,940 | $ | 7,660 | $ | 476,399 | $ | 940,821 | |||||||||||||||||||||||||||||||
Scheduled | $ | 36,006 | $ | 8,331 | $ | 35,682 | $ | 24,793 | $ | 6,321 | $ | 16,062 | $ | 568,277 | $ | 695,472 | |||||||||||||||||||||||||||||||
Unscheduled | 56,299 | 9,257 | 33,319 | 21,135 | 20,538 | — | — | 140,548 | |||||||||||||||||||||||||||||||||||||||
December 31, 2018 | $ | 92,305 | $ | 17,588 | $ | 69,001 | $ | 45,928 | $ | 26,859 | $ | 16,062 | $ | 568,277 | $ | 836,020 | |||||||||||||||||||||||||||||||
Scheduled | $ | 73,476 | $ | 5,677 | $ | 21,742 | $ | 28,135 | $ | 25,640 | $ | 8,286 | $ | 1,102,798 | $ | 1,265,754 | |||||||||||||||||||||||||||||||
Unscheduled | 77,492 | 4,562 | 47,159 | 35,068 | 3,476 | — | 9,760 | 177,517 | |||||||||||||||||||||||||||||||||||||||
September 30, 2018 | $ | 150,968 | $ | 10,239 | $ | 68,901 | $ | 63,203 | $ | 29,116 | $ | 8,286 | $ | 1,112,558 | $ | 1,443,271 | |||||||||||||||||||||||||||||||
Scheduled | $ | 33,075 | $ | 8,391 | $ | 31,067 | $ | 36,983 | $ | 353 | $ | 8,699 | $ | 759,223 | $ | 877,791 | |||||||||||||||||||||||||||||||
Unscheduled | 86,426 | 8,273 | 69,539 | 66,601 | 51,306 | — | — | 282,145 | |||||||||||||||||||||||||||||||||||||||
June 30, 2018 | $ | 119,501 | $ | 16,664 | $ | 100,606 | $ | 103,584 | $ | 51,659 | $ | 8,699 | $ | 759,223 | $ | 1,159,936 | |||||||||||||||||||||||||||||||
For the year ended: | |||||||||||||||||||||||||||||||||||||||||||||||
Scheduled | $ | 307,761 | $ | 17,433 | $ | 195,424 | $ | 132,937 | $ | 80,416 | $ | 43,995 | $ | 2,181,446 | $ | 2,959,412 | |||||||||||||||||||||||||||||||
Unscheduled | 367,867 | 11,107 | 260,465 | 195,295 | 58,511 | — | 19,675 | 912,920 | |||||||||||||||||||||||||||||||||||||||
December 31, 2019 | $ | 675,628 | $ | 28,540 | $ | 455,889 | $ | 328,232 | $ | 138,927 | $ | 43,995 | $ | 2,201,121 | $ | 3,872,332 | |||||||||||||||||||||||||||||||
Scheduled | $ | 253,290 | $ | 36,484 | $ | 158,548 | $ | 130,722 | $ | 58,821 | $ | 33,047 | $ | 2,822,608 | $ | 3,493,520 | |||||||||||||||||||||||||||||||
Unscheduled | 293,719 | 27,021 | 231,221 | 165,993 | 90,272 | 120,022 | 9,760 | 938,008 | |||||||||||||||||||||||||||||||||||||||
December 31, 2018 | $ | 547,009 | $ | 63,505 | $ | 389,769 | $ | 296,715 | $ | 149,093 | $ | 153,069 | $ | 2,832,368 | $ | 4,431,528 |
Lines of Business - Outstanding Business Volume | |||||||||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | ||||||||||||||||||||||||||||||||||||||||||||
Loans | Guaranteed Securities | LTSPCs | USDA Securities | Loans | LTSPCs | AgVantage | Total | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
As of: | |||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020 | $ | 5,617,512 | $ | 90,225 | $ | 2,310,113 | $ | 2,677,807 | $ | 2,101,568 | $ | 590,053 | $ | 8,654,830 | $ | 22,042,108 | |||||||||||||||||||||||||||||||
March 31, 2020 | 5,358,382 | 97,302 | 2,355,910 | 2,646,206 | 1,789,726 | 595,685 | 8,696,101 | 21,539,312 | |||||||||||||||||||||||||||||||||||||||
December 31, 2019 | 5,276,557 | 107,322 | 2,393,071 | 2,620,175 | 1,671,293 | 609,278 | 8,440,246 | 21,117,942 | |||||||||||||||||||||||||||||||||||||||
September 30, 2019 | 4,836,966 | 115,306 | 2,441,456 | 2,567,763 | 1,612,773 | 619,829 | 8,738,266 | 20,932,359 | |||||||||||||||||||||||||||||||||||||||
June 30, 2019 | 4,754,258 | 121,064 | 2,416,030 | 2,521,394 | 1,527,150 | 628,521 | 8,778,318 | 20,746,735 | |||||||||||||||||||||||||||||||||||||||
March 31, 2019 | 4,610,897 | 128,221 | 2,476,467 | 2,484,779 | 1,429,101 | 645,613 | 8,731,835 | 20,506,913 | |||||||||||||||||||||||||||||||||||||||
December 31, 2018 | 4,588,322 | 135,862 | 2,509,787 | 2,515,620 | 938,843 | 653,273 | 8,382,817 | 19,724,524 | |||||||||||||||||||||||||||||||||||||||
September 30, 2018 | 4,420,619 | 287,594 | 2,363,805 | 2,471,251 | 962,702 | 669,335 | 8,365,280 | 19,540,586 | |||||||||||||||||||||||||||||||||||||||
June 30, 2018 | 4,378,958 | 297,833 | 2,368,606 | 2,418,115 | 991,819 | 677,621 | 8,391,885 | 19,524,837 |
On-Balance Sheet Outstanding Business Volume | |||||||||||||||||||||||
Fixed Rate | 5- to 10-Year ARMs & Resets | 1-Month to 3-Year ARMs | Total Held in Portfolio | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
As of: | |||||||||||||||||||||||
June 30, 2020 | $ | 10,793,629 | $ | 2,845,266 | $ | 5,076,445 | 18,715,340 | ||||||||||||||||
March 31, 2020 | 10,296,598 | 2,818,869 | 4,996,478 | 18,111,945 | |||||||||||||||||||
December 31, 2019 | 10,045,712 | 2,863,199 | 4,702,577 | 17,611,488 | |||||||||||||||||||
September 30, 2019 | 9,642,802 | 2,850,000 | 4,549,689 | 17,042,491 | |||||||||||||||||||
June 30, 2019 | 9,446,117 | 2,825,151 | 4,601,917 | 16,873,185 | |||||||||||||||||||
March 31, 2019 | 9,206,082 | 2,720,639 | 4,643,506 | 16,570,227 | |||||||||||||||||||
December 31, 2018 | 8,325,347 | 2,717,505 | 4,705,169 | 15,748,021 | |||||||||||||||||||
September 30, 2018 | 7,945,007 | 2,629,612 | 4,986,987 | 15,561,606 | |||||||||||||||||||
June 30, 2018 | 7,551,149 | 2,594,399 | 5,398,021 | 15,543,569 |
Net Effective Spread by Line of Business | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Farm & Ranch | USDA Guarantees | Rural Utilities | Institutional Credit | Corporate | Net Effective Spread | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dollars | Yield | Dollars | Yield | Dollars | Yield | Dollars | Yield | Dollars | Yield | Dollars | Yield | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the quarter ended: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2020(1) | $ | 16,733 | 1.71 | % | $ | 4,689 | 0.81 | % | $ | 5,516 | 1.15 | % | $ | 18,782 | 0.86 | % | $ | 749 | 0.08 | % | $ | 46,469 | 0.89 | % | |||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2020 | 14,938 | 1.64 | % | 4,625 | 0.81 | % | 4,920 | 1.14 | % | 17,702 | 0.84 | % | 1,978 | 0.21 | % | 44,163 | 0.89 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2019 | 16,374 | 1.90 | % | 4,363 | 0.78 | % | 4,871 | 1.17 | % | 18,008 | 0.85 | % | 2,375 | 0.27 | % | 45,991 | 0.95 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, 2019 | 13,181 | 1.66 | % | 4,314 | 0.79 | % | 4,502 | 1.16 | % | 17,807 | 0.84 | % | 2,657 | 0.30 | % | 42,461 | 0.90 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2019(1) | 13,335 | 1.72 | % | 4,097 | 0.76 | % | 3,996 | 1.10 | % | 17,371 | 0.82 | % | 2,556 | 0.34 | % | 41,355 | 0.91 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2019 | 12,737 | 1.70 | % | 3,964 | 0.74 | % | 3,233 | 1.12 | % | 16,373 | 0.79 | % | 2,494 | 0.35 | % | 38,801 | 0.89 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2018 | 13,288 | 1.79 | % | 4,630 | 0.85 | % | 2,833 | 1.19 | % | 15,751 | 0.80 | % | 2,353 | 0.36 | % | 38,855 | 0.93 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, 2018 | 13,887 | 1.91 | % | 4,627 | 0.86 | % | 2,877 | 1.18 | % | 15,642 | 0.78 | % | 2,044 | 0.30 | % | 39,077 | 0.93 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2018 | 13,347 | 1.86 | % | 4,398 | 0.83 | % | 2,923 | 1.15 | % | 15,220 | 0.76 | % | 274 | 0.04 | % | 36,162 | 0.86 | % |
Core Earnings by Quarter End | |||||||||||||||||||||||||||||||||||||||||||||||||||||
June 2020 | March 2020 | December 2019 | September 2019 | June 2019 | March 2019 | December 2018 | September 2018 | June 2018 | |||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Net effective spread | $ | 46,469 | $ | 44,163 | $ | 45,991 | $ | 42,461 | $ | 41,355 | $ | 38,801 | $ | 38,855 | $ | 39,077 | $ | 36,162 | |||||||||||||||||||||||||||||||||||
Guarantee and commitment fees | 4,943 | 4,896 | 5,432 | 5,208 | 5,276 | 5,419 | 5,309 | 5,170 | 5,171 | ||||||||||||||||||||||||||||||||||||||||||||
Other | 1,048 | 674 | 100 | 389 | 777 | 509 | (129) | 110 | 111 | ||||||||||||||||||||||||||||||||||||||||||||
Total revenues | 52,460 | 49,733 | 51,523 | 48,058 | 47,408 | 44,729 | 44,035 | 44,357 | 41,444 | ||||||||||||||||||||||||||||||||||||||||||||
Credit related expense/(income): | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for/(release of) losses | 51 | 3,831 | 2,851 | 623 | 420 | (393) | 166 | (3) | 582 | ||||||||||||||||||||||||||||||||||||||||||||
REO operating expenses | — | — | — | — | 64 | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
(Gains)/losses on sale of REO | — | (485) | — | — | — | — | — | 41 | (34) | ||||||||||||||||||||||||||||||||||||||||||||
Total credit related expense/(income) | 51 | 3,346 | 2,851 | 623 | 484 | (393) | 166 | 38 | 548 | ||||||||||||||||||||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Compensation and employee benefits | 8,087 | 10,127 | 6,732 | 7,654 | 6,770 | 7,606 | 7,167 | 6,777 | 6,936 | ||||||||||||||||||||||||||||||||||||||||||||
General and administrative | 5,295 | 5,363 | 5,773 | 5,253 | 4,689 | 4,596 | 5,829 | 4,350 | 5,202 | ||||||||||||||||||||||||||||||||||||||||||||
Regulatory fees | 725 | 725 | 725 | 688 | 687 | 688 | 687 | 625 | 625 | ||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 14,107 | 16,215 | 13,230 | 13,595 | 12,146 | 12,890 | 13,683 | 11,752 | 12,763 | ||||||||||||||||||||||||||||||||||||||||||||
Net earnings | 38,302 | 30,172 | 35,442 | 33,840 | 34,778 | 32,232 | 30,186 | 32,567 | 28,133 | ||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | 8,016 | 6,598 | 7,526 | 7,018 | 7,351 | 6,715 | 6,431 | 6,891 | 5,477 | ||||||||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | 3,939 | 3,431 | 3,432 | 3,427 | 3,785 | 3,296 | 3,296 | 3,295 | 3,296 | ||||||||||||||||||||||||||||||||||||||||||||
Core earnings | $ | 26,347 | $ | 20,143 | $ | 24,484 | $ | 23,395 | $ | 23,642 | $ | 22,221 | $ | 20,459 | $ | 22,381 | $ | 19,360 | |||||||||||||||||||||||||||||||||||
Reconciling items: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Gains/(losses) on undesignated financial derivatives due to fair value changes | 8,700 | (6,484) | 4,469 | (7,117) | 10,485 | 2,240 | (96) | 3,625 | 6,709 | ||||||||||||||||||||||||||||||||||||||||||||
(Losses)/gains on hedging activities due to fair value changes | (2,676) | (5,925) | (220) | (4,535) | (1,438) | (2,817) | (853) | 1,051 | 1,687 | ||||||||||||||||||||||||||||||||||||||||||||
Unrealized (losses)/gains on trading assets | (20) | 106 | 172 | 49 | 61 | 44 | 57 | (3) | 11 | ||||||||||||||||||||||||||||||||||||||||||||
Amortization of premiums/discounts and deferred gains on assets consolidated at fair value | 35 | 3 | 40 | (7) | (139) | (16) | 67 | (38) | 196 | ||||||||||||||||||||||||||||||||||||||||||||
Net effects of terminations or net settlements on financial derivatives | 720 | (1,300) | 1,339 | 232 | (592) | 110 | (312) | 546 | 232 | ||||||||||||||||||||||||||||||||||||||||||||
Issuance costs on the retirement of preferred stock | — | — | — | — | (1,956) | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Income tax effect related to reconciling items | (1,419) | 2,856 | (1,218) | 2,389 | (1,759) | 92 | 238 | (1,088) | (1,855) | ||||||||||||||||||||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | 31,687 | $ | 9,399 | $ | 29,066 | $ | 14,406 | $ | 28,304 | $ | 21,874 | $ | 19,560 | $ | 26,474 | $ | 26,340 |
** | 3.1 | — | ||||||||||||||||||
* | 3.2 | — | ||||||||||||||||||
* | 4.1 | — | ||||||||||||||||||
* | 4.2 | — | ||||||||||||||||||
* | 4.3 | — | ||||||||||||||||||
* | 4.4 | — | ||||||||||||||||||
* | 4.4.1 | — | ||||||||||||||||||
* | 4.5 | — | ||||||||||||||||||
* | 4.5.1 | — | ||||||||||||||||||
* | 4.6 | — | ||||||||||||||||||
* | 4.6.1 | — | ||||||||||||||||||
** | 4.7 | — | ||||||||||||||||||
* | 4.7.1 | — | ||||||||||||||||||
** | 4.8 | — | ||||||||||||||||||
* | 10.1 | — | ||||||||||||||||||
* | 21 | — | ||||||||||||||||||
** | 31.1 | — | ||||||||||||||||||
** | 31.2 | — | ||||||||||||||||||
** | 32 | — | ||||||||||||||||||
** | 101.INS | — | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||||||||||||
** | 101.SCH | — | Inline XBRL Taxonomy Extension Schema | |||||||||||||||||
** | 101.CAL | — | Inline XBRL Taxonomy Extension Calculation | |||||||||||||||||
** | 101.DEF | — | Inline XBRL Taxonomy Extension Definition | |||||||||||||||||
** | 101.LAB | — | Inline XBRL Taxonomy Extension Label | |||||||||||||||||
** | 101.PRE | — | Inline XBRL Taxonomy Extension Presentation | |||||||||||||||||
** | 104 | — | Cover Page Inline Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document included as Exhibit 101 |
* | Incorporated by reference to the indicated prior filing. | ||||
** | Filed with this report. | ||||
# | Portions of this exhibit have been omitted pursuant to a request for confidential treatment. | ||||
† | Management contract or compensatory plan. |
/s/ Bradford T. Nordholm | August 10, 2020 | ||||||||||
By: | Bradford T. Nordholm | Date | |||||||||
President and Chief Executive Officer | |||||||||||
(Principal Executive Officer) |
/s/ Aparna Ramesh | August 10, 2020 | ||||||||||
By: | Aparna Ramesh | Date | |||||||||
Executive Vice President - Chief Financial Officer and Treasurer | |||||||||||
(Principal Financial Officer) |
Series E Certificate No. | No. of Series E Shares 3,000,000 | |||||||
1 | CUSIP No.: 313148850 |
____SPECIMEN__________________ | ___SPECIMEN_______________________ | |||||||
President and Chief Executive Officer | Executive Vice President – General Counsel and Secretary |
/s/ Bradford T. Nordholm | |||||
Bradford T. Nordholm | |||||
Chief Executive Officer |
/s/ Aparna Ramesh | |||||
Aparna Ramesh | |||||
Chief Financial Officer |
/s/ Bradford T. Nordholm | ||||||||
Bradford T. Nordholm | ||||||||
Chief Executive Officer | ||||||||
/s/ Aparna Ramesh | ||||||||
Aparna Ramesh | ||||||||
Chief Financial Officer | ||||||||
Date: | August 10, 2020 |
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2020 |
Jun. 30, 2019 |
Jun. 30, 2020 |
Jun. 30, 2019 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 35,626 | $ 34,045 | $ 48,456 | $ 59,215 |
Other comprehensive income before taxes: | ||||
Net unrealized gains/(losses) on available-for-sale securities | 42,527 | (28,588) | (56,789) | (25,347) |
Net changes in held-to-maturity securities | (2,496) | (4,601) | (8,184) | (6,863) |
Net unrealized losses on cash flow hedges | (2,132) | (9,972) | (30,388) | (15,637) |
Other comprehensive gain/(loss) before tax | 37,899 | (43,161) | (95,361) | (47,847) |
Income tax (expense)/benefit related to other comprehensive gain/(loss) | (7,959) | 9,064 | 20,025 | 10,048 |
Other comprehensive gain/(loss) net of tax | 29,940 | (34,097) | (75,336) | (37,799) |
Comprehensive income/(loss) attributable to Farmer Mac | $ 65,566 | $ (52) | $ (26,880) | $ 21,416 |
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Thousands, $ in Thousands |
Total |
Cumulative Effect, Period of Adoption, Adjustment |
Cumulative Effect, Period of Adoption, Adjusted Balance |
Class C non-voting common stock |
Series E Preferred Stock |
5.700% Non-Cumulative Preferred Stock, Series D |
Series B Preferred Stock |
Preferred Stock |
Preferred Stock
Cumulative Effect, Period of Adoption, Adjusted Balance
|
Preferred Stock
Series E Preferred Stock
|
Preferred Stock
5.700% Non-Cumulative Preferred Stock, Series D
|
Preferred Stock
Series B Preferred Stock
|
Common Stock |
Common Stock
Cumulative Effect, Period of Adoption, Adjusted Balance
|
Common Stock
Class C non-voting common stock
|
Additional Paid-in Capital |
Additional Paid-in Capital
Cumulative Effect, Period of Adoption, Adjusted Balance
|
Additional Paid-in Capital
Class C non-voting common stock
|
Accumulated Other Comprehensive Income (Loss) |
Accumulated Other Comprehensive Income (Loss)
Cumulative Effect, Period of Adoption, Adjusted Balance
|
Retained Earnings |
Retained Earnings
Cumulative Effect, Period of Adoption, Adjustment
|
Retained Earnings
Cumulative Effect, Period of Adoption, Adjusted Balance
|
Retained Earnings
Class C non-voting common stock
|
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Beginning balance ( in shares) at Dec. 31, 2018 | 8,400 | 10,669 | ||||||||||||||||||||||
Beginning balance at Dec. 31, 2018 | $ 752,557 | $ 204,759 | $ 10,669 | $ 118,822 | $ 24,956 | $ 393,351 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income | 25,170 | 25,170 | ||||||||||||||||||||||
Other comprehensive loss, net of tax | (3,702) | (3,702) | ||||||||||||||||||||||
Cash dividends, preferred stock | (3,296) | (3,296) | ||||||||||||||||||||||
Cash dividends, common stock | (7,470) | (7,470) | ||||||||||||||||||||||
Issuance of stock (in shares) | 20 | |||||||||||||||||||||||
Issuance of stock | $ 23 | $ 20 | $ 3 | |||||||||||||||||||||
Stock-based compensation cost | 724 | 724 | ||||||||||||||||||||||
Other stock-based award activity | (708) | (708) | ||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2019 | 8,400 | 10,689 | ||||||||||||||||||||||
Ending balance at Mar. 31, 2019 | 763,298 | $ 204,759 | $ 10,689 | 118,841 | 21,254 | 407,755 | ||||||||||||||||||
Beginning balance ( in shares) at Dec. 31, 2018 | 8,400 | 10,669 | ||||||||||||||||||||||
Beginning balance at Dec. 31, 2018 | 752,557 | $ 204,759 | $ 10,669 | 118,822 | 24,956 | 393,351 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income | 59,215 | |||||||||||||||||||||||
Other comprehensive loss, net of tax | (37,799) | |||||||||||||||||||||||
Loss on retirement of preferred stock | (1,956) | |||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2019 | 9,400 | 10,700 | ||||||||||||||||||||||
Ending balance at Jun. 30, 2019 | 773,742 | $ 228,374 | $ 10,700 | 118,942 | (12,843) | 428,569 | ||||||||||||||||||
Beginning balance ( in shares) at Dec. 31, 2018 | 8,400 | 10,669 | ||||||||||||||||||||||
Beginning balance at Dec. 31, 2018 | 752,557 | $ 204,759 | $ 10,669 | 118,822 | 24,956 | 393,351 | ||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2019 | 9,400 | 9,400 | 10,712 | 10,712 | ||||||||||||||||||||
Ending balance at Dec. 31, 2019 | 799,276 | $ (2,099) | $ 797,177 | $ 228,374 | $ 228,374 | $ 10,712 | $ 10,712 | 119,304 | $ 119,304 | (16,161) | $ (16,161) | 457,047 | $ (2,099) | $ 454,948 | ||||||||||
Beginning balance ( in shares) at Mar. 31, 2019 | 8,400 | 10,689 | ||||||||||||||||||||||
Beginning balance at Mar. 31, 2019 | 763,298 | $ 204,759 | $ 10,689 | 118,841 | 21,254 | 407,755 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income | 34,045 | 34,045 | ||||||||||||||||||||||
Other comprehensive loss, net of tax | (34,097) | (34,097) | ||||||||||||||||||||||
Cash dividends, preferred stock | (3,785) | (3,785) | ||||||||||||||||||||||
Cash dividends, common stock | (7,490) | (7,490) | ||||||||||||||||||||||
Issuance of stock (in shares) | 4,000 | 11 | ||||||||||||||||||||||
Issuance of stock | 14 | $ 96,659 | $ 96,659 | $ 11 | 3 | |||||||||||||||||||
Redemption of stock (in shares) | (3,000) | |||||||||||||||||||||||
Redemption of stock | $ (73,044) | $ (73,044) | ||||||||||||||||||||||
Loss on retirement of preferred stock | (1,956) | (1,956) | ||||||||||||||||||||||
Stock-based compensation cost | 533 | 533 | ||||||||||||||||||||||
Other stock-based award activity | (435) | (435) | ||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2019 | 9,400 | 10,700 | ||||||||||||||||||||||
Ending balance at Jun. 30, 2019 | 773,742 | $ 228,374 | $ 10,700 | 118,942 | (12,843) | 428,569 | ||||||||||||||||||
Beginning balance ( in shares) at Dec. 31, 2019 | 9,400 | 9,400 | 10,712 | 10,712 | ||||||||||||||||||||
Beginning balance at Dec. 31, 2019 | 799,276 | (2,099) | 797,177 | $ 228,374 | $ 228,374 | $ 10,712 | $ 10,712 | 119,304 | 119,304 | (16,161) | (16,161) | 457,047 | (2,099) | 454,948 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income | 12,830 | 12,830 | ||||||||||||||||||||||
Other comprehensive loss, net of tax | (105,276) | (105,276) | ||||||||||||||||||||||
Cash dividends, preferred stock | (3,431) | (3,431) | ||||||||||||||||||||||
Cash dividends, common stock | (8,571) | (8,571) | ||||||||||||||||||||||
Issuance of stock (in shares) | 15 | |||||||||||||||||||||||
Issuance of stock | 34 | $ 15 | 19 | |||||||||||||||||||||
Repurchase of Class C Common Stock (in shares) | (4) | |||||||||||||||||||||||
Repurchase of Class C Common Stock | (235) | $ (4) | $ (231) | |||||||||||||||||||||
Stock-based compensation cost | 1,293 | 1,293 | ||||||||||||||||||||||
Other stock-based award activity | (204) | (204) | ||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2020 | 9,400 | 10,723 | ||||||||||||||||||||||
Ending balance at Mar. 31, 2020 | 693,617 | $ 228,374 | $ 10,723 | 120,412 | (121,437) | 455,545 | ||||||||||||||||||
Beginning balance ( in shares) at Dec. 31, 2019 | 9,400 | 9,400 | 10,712 | 10,712 | ||||||||||||||||||||
Beginning balance at Dec. 31, 2019 | 799,276 | $ (2,099) | $ 797,177 | $ 228,374 | $ 228,374 | $ 10,712 | $ 10,712 | 119,304 | $ 119,304 | (16,161) | $ (16,161) | 457,047 | $ (2,099) | $ 454,948 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income | 48,456 | |||||||||||||||||||||||
Other comprehensive loss, net of tax | (75,336) | |||||||||||||||||||||||
Loss on retirement of preferred stock | 0 | |||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2020 | 12,580 | 10,733 | ||||||||||||||||||||||
Ending balance at Jun. 30, 2020 | $ 824,116 | $ 305,377 | $ 10,733 | 120,856 | (91,497) | 478,647 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | |||||||||||||||||||||||
Beginning balance ( in shares) at Mar. 31, 2020 | 9,400 | 10,723 | ||||||||||||||||||||||
Beginning balance at Mar. 31, 2020 | $ 693,617 | $ 228,374 | $ 10,723 | 120,412 | (121,437) | 455,545 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income | 35,626 | 35,626 | ||||||||||||||||||||||
Other comprehensive loss, net of tax | 29,940 | 29,940 | ||||||||||||||||||||||
Cash dividends, preferred stock | (3,939) | (3,939) | ||||||||||||||||||||||
Cash dividends, common stock | (8,585) | (8,585) | ||||||||||||||||||||||
Issuance of stock (in shares) | 3,180 | 10 | ||||||||||||||||||||||
Issuance of stock | $ 27 | $ 77,003 | $ 77,003 | $ 10 | $ 17 | |||||||||||||||||||
Loss on retirement of preferred stock | 0 | |||||||||||||||||||||||
Stock-based compensation cost | 719 | |||||||||||||||||||||||
Other stock-based award activity | (292) | (292) | ||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2020 | 12,580 | 10,733 | ||||||||||||||||||||||
Ending balance at Jun. 30, 2020 | $ 824,116 | $ 305,377 | $ 10,733 | $ 120,856 | $ (91,497) | $ 478,647 |
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares |
3 Months Ended | |||
---|---|---|---|---|
Jun. 30, 2020 |
Mar. 31, 2020 |
Jun. 30, 2019 |
Mar. 31, 2019 |
|
Statement of Stockholders' Equity [Abstract] | ||||
Common stock dividends per common share (in dollars per share) | $ 0.80 | $ 0.80 | $ 0.70 | $ 0.70 |
Summary of Significant Accounting Policies |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The interim unaudited consolidated financial statements of the Federal Agricultural Mortgage Corporation ("Farmer Mac") and subsidiaries have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). These interim unaudited consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the financial position and the results of operations and cash flows of Farmer Mac and subsidiaries for the interim periods presented. Certain information and footnote disclosures normally included in the annual consolidated financial statements have been omitted as permitted by SEC rules and regulations. The December 31, 2019 consolidated balance sheet presented in this report has been derived from Farmer Mac's audited 2019 consolidated financial statements. Management believes that the disclosures are adequate to present fairly the consolidated financial statements as of the dates and for the periods presented. These interim unaudited consolidated financial statements should be read in conjunction with the 2019 consolidated financial statements of Farmer Mac and subsidiaries included in Farmer Mac's Annual Report on Form 10-K for the year ended December 31, 2019, as filed with the SEC on February 25, 2020. Results for interim periods are not necessarily indicative of those that may be expected for the fiscal year. Presented below are Farmer Mac's significant accounting policies that contain updated information for the three and six months ended June 30, 2020. Principles of Consolidation The consolidated financial statements include the accounts of Farmer Mac and its two subsidiaries during the year: (1) Farmer Mac Mortgage Securities Corporation ("FMMSC"), whose principal activities are to facilitate the purchase and issuance of Farmer Mac Guaranteed Securities; and (2) Farmer Mac II LLC, whose principal activity is the operation of substantially all of the business related to the USDA Guarantees line of business – primarily the acquisition of USDA Securities. The consolidated financial statements also include the accounts of Variable Interest Entities ("VIEs") in which Farmer Mac determined itself to be the primary beneficiary. The following tables present, by line of business, details about the consolidation of VIEs: Table 1.1
(1)Includes borrower remittances of $40.9 million. The borrower remittances had not been passed through to third party investors as of June 30, 2020. (2)Includes $0.1 million of unamortized premiums and discounts and fair value adjustments related to the USDA Guarantees line of business. (3)Farmer Mac uses unpaid principal balance and outstanding face amount of investment securities to represent maximum exposure to loss. (4)Includes auction-rate certificates, asset-backed securities, and government-sponsored enterprise ("GSE")-guaranteed mortgage-backed securities. (5)The amount under the Farm & Ranch line of business relates to unconsolidated trusts where Farmer Mac determined it was not the primary beneficiary due to shared power with an unrelated party.
(1)Includes borrower remittances of $15.6 million. The borrower remittances had not been passed through to third party investors as of December 31, 2019. (2)Includes $0.2 million of unamortized premiums and discounts and fair value adjustments related to the USDA Guarantees line of business. (3)Farmer Mac uses unpaid principal balance and outstanding face amount of investment securities to represent maximum exposure to loss. (4)Includes auction-rate certificates, asset-backed securities, and government-sponsored enterprise ("GSE")-guaranteed mortgage-backed securities. (5)The amount under the Farm & Ranch line of business relates to unconsolidated trusts where Farmer Mac determined it was not the primary beneficiary due to shared power with an unrelated party. Earnings Per Common ShareBasic earnings per common share ("EPS") is based on the daily weighted-average number of shares of common stock outstanding. Diluted earnings per common share is based on the daily weighted-average number of shares of common stock outstanding adjusted to include all potentially dilutive stock appreciation rights ("SARs") and unvested restricted stock awards. The following schedule reconciles basic and diluted EPS for the three and six months ended June 30, 2020 and 2019: Table 1.2
(1)For the three months ended June 30, 2020 and 2019, SARs and restricted stock of 83,297 and 62,660, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive. For the three months ended June 30, 2020 and 2019, contingent shares of unvested restricted stock of 12,680 and 12,284, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.
(1)For the six months ended June 30, 2020 and 2019, SARs and restricted stock of 85,223 and 59,818, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive. For the six months ended June 30, 2020 and 2019, contingent shares of unvested restricted stock of 12,680 and 12,284, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met. Comprehensive IncomeComprehensive income represents all changes in stockholders' equity except those resulting from investments by or distributions to stockholders, and is comprised of net income and unrealized gains and losses on available-for-sale securities, certain held-to-maturity securities transferred from the available-for-sale classification, and cash flow hedges, net of related taxes. The following table presents the changes in accumulated other comprehensive income ("AOCI"), net of tax, by component for the three and six months ended June 30, 2020 and 2019: Table 1.3
The following table presents other comprehensive income activity, the impact on net income of amounts reclassified from each component of AOCI, and the related tax impact for the three and six months ended June 30, 2020 and 2019: Table 1.4
(1)Relates to the amortization of unrealized gains on hedged items prior to the application of fair value hedge accounting. (2)Represents amortization of deferred gains related to certain available-for-sale USDA Securities and Farmer Mac Guaranteed USDA Securities. (3)Relates to the amortization of unrealized gains or losses prior to the reclassification of these securities from available-for-sale to held-to-maturity. The amortization of unrealized gains or losses reported in AOCI for held-to-maturity securities will be offset by the amortization of the premium or discount created from the transfer into held-to-maturity securities, which occurred at fair value. These unrealized gains or losses will be recorded over the remaining life of the security with no impact on future net income. (4)Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI.
(1)Relates to the amortization of unrealized gains on hedged items prior to the application of fair value hedge accounting. (2)Represents amortization of deferred gains related to certain available-for-sale USDA Securities and Farmer Mac Guaranteed USDA Securities. (3)Relates to the amortization of unrealized gains or losses prior to the reclassification of these securities from available-for-sale to held-to-maturity. The amortization of unrealized gains or losses reported in AOCI for held-to-maturity securities will be offset by the amortization of the premium or discount created from the transfer into held-to-maturity securities, which occurred at fair value. These unrealized gains or losses will be recorded over the remaining life of the security with no impact on future net income. (4)Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI. Allowance for Losses and Reserve for LossesOn January 1, 2020, Farmer Mac adopted Accounting Standards Update 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, ("CECL"). Under CECL, Farmer Mac's allowance for credit losses represents the difference between the carrying amount of the related financial instruments and the present value of their expected cash flows discounted at their effective interest rates, as of the respective balance sheet date. Under CECL, Farmer Mac's reserve for credit losses represents the difference between the outstanding amount of off-balance sheet credit exposures and the present value of their expected cash flows discounted at their effective interest rates. Farmer Mac maintains an allowance for credit losses to cover current expected credit losses as of the balance sheet date for on-balance sheet investment securities, loans held for investment, and Farmer Mac Guaranteed Securities (collectively referred to as "allowance for losses"). Additionally, Farmer Mac maintains a reserve for credit losses to cover current expected credit losses as of the balance sheet date for off-balance sheet loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities (collectively referred to as "reserve for losses"). Both the allowance for losses and reserve for losses are based on historical information and reasonable and supportable forecasts. Farmer Mac has never experienced a credit loss in its Rural Utilities line of business. Upon the adoption of CECL, Farmer Mac is now required to measure its expected credit losses for the expected life of all financial instruments, including its Rural Utilities loans. To estimate expected credit losses on these loans, Farmer Mac relies upon industry historical credit loss data from ratings agencies and publicly available information as disclosed in the securities filings of other major lenders who serve the utilities industry. The allowance for losses increases through periodic provisions for loan losses that are charged against net interest income and the reserve for losses increases through provisions for losses that are charged to non-interest expense. Both the allowance for losses and reserve for losses are decreased by charge-offs for realized losses, net of recoveries. Releases from the allowance for losses or reserve for losses occur when the estimate of expected credit losses as of the end of a period is less than the estimate at the beginning of the period. The total allowance for losses consists of the allowance for losses and the reserve for losses. Charge-offs Farmer Mac records a charge-off against the allowance for losses principally when a loss has been confirmed through the receipt of assets, generally the underlying collateral, in full satisfaction of the loan. The loss equals the excess of the recorded investment in the loan over the fair value of the collateral less estimated selling costs. Estimation Methodology Farmer Mac bases its methodology for determining its current estimate of expected losses on a statistical model, which incorporates credit loss history and reasonable and supportable forecasts. Farmer Mac's estimation methodology is comprised of the following key components: •An economic model for each portfolio, including Farm & Ranch, Rural Utilities, and Institutional Credit; •A migration matrix for each portfolio that reasonably predicts the movement of each financial asset among various risk categories over the course of each asset's expected life. The migration matrix forms the basis for our estimate of the probability of default of each financial asset; •A loss-given-default ("LGD") model that reasonably predicts the amount of loss that Farmer Mac would incur upon the default of each financial asset; •An economic factor forecast that updates the migration matrix model and the LGD model with current assumptions for the economic indicators that Farmer Mac has determined are most correlated with or relevant to the performance of each portfolio of assets; including Gross Domestic Product ("GDP"), credit spreads, unemployment rates, land values, and commodity prices; and •A discounted cash flow analysis, which relies upon each of the above model outputs, plus the contractual terms of each financial asset, and the effective interest rate of each financial asset. Management evaluates these assumptions by considering many relevant factors, including: •economic conditions; •geographic and agricultural commodity/product concentrations in the portfolio; •the credit profile of the portfolio, including risk ratings and financial metrics; •delinquency trends of the portfolio; •historical charge-off and recovery activities of the portfolio; and •other factors to capture current portfolio trends and characteristics that differ from historical experience. Management believes that its methodology produces a reasonable estimate of expected credit losses, as of the balance sheet date, for the expected life of all of its financial assets. Allowance for Loss on Available-for-Sale (AFS) Securities To measure current expected credit losses on impaired AFS securities, Farmer Mac first considers those impaired securities that: 1) Farmer Mac does not intend to sell, and 2) it is not more likely than not that Farmer Mac will be required to sell before recovering its amortized cost basis. In assessing whether a credit loss exists, Farmer Mac compares the present value, discounted at the security's effective interest rate, of cash flows expected to be collected from an impaired AFS debt security to its amortized cost basis. If the present value of cash flows expected to be collected is less than the amortized cost basis of the impaired security, a credit loss exists and Farmer Mac records an allowance for loss for that credit loss. However, the amount of that allowance is limited by the amount that the security’s fair value is less than its amortized cost basis. Accrued interest receivable is recorded separately on the Consolidated Balance Sheet, and the allowance for credit losses excludes uncollectible accrued interest receivable. Collateral Dependent Assets ("CDAs") CDAs are loans, loans underlying LTSPCs, or off-balance sheet credit exposures in which the borrower is either in foreclosure or is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral by Farmer Mac. Farmer Mac estimates the current expected credit loss on CDAs based upon the appraised value of the collateral, the costs to sell it, and any applicable credit protection such as a guarantee. COVID-19 Payment Deferments The Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was signed into law on March 27, 2020. Section 4013 of the CARES Act titled “Temporary Relief from Troubled Debt Restructurings” provides financial institutions the option to temporarily suspend certain requirements under U.S. GAAP related to troubled debt restructurings (“TDRs”) for a limited period of time to account for the effects of the novel coronavirus disease 2019 ("COVID-19"). On April 10, 2020, Farmer Mac’s prudential regulator, the Office of Secondary Market Oversight (OSMO) within the Farm Credit Administration (FCA), issued guidance to Farmer Mac on loan servicing and reporting TDRs for lines of business affected by the COVID-19 outbreak. This guidance was consistent with the guidance provided by other financial regulatory agencies and the Financial Accounting Standards Board that short-term modifications made on a good faith basis in response to the COVID-19 national emergency are not TDRs when the borrower was not past due on loan payments before the March 13, 2020 presidential proclamation declaring the COVID-19 outbreak a national emergency. During second quarter 2020, Farmer Mac implemented the guidance from FCA by granting up to 6-month payment deferments to borrowers who have been economically impacted by COVID-19. Farmer Mac deems loans under a COVID-19 payment deferment not to be past due and continues to accrue interest on those loans. Furthermore, Farmer Mac does not consider a payment deferment on any such loan to be a troubled debt restructuring. For the purpose of estimating expected credit losses on Farm & Ranch loans held for investment, Farmer Mac does consider payment deferments along with other available credit and economic information that pertains to that portfolio. New Accounting StandardsRecently Adopted Accounting Guidance
The following table presents the impact of adopting on January 1, 2020 on our allowance and retained earnings: Table 1.5
Recently Issued Accounting Guidance, Not Yet Adopted Within Our Consolidated Financial Statements
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Investment Securities |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | INVESTMENT SECURITIES The following tables set forth information about Farmer Mac's investment securities as of June 30, 2020 and December 31, 2019: Table 2.1
(1)Amounts presented exclude $6.6 million of accrued interest receivable on investment securities as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the consolidated statement of operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The held-to-maturity investment securities had a weighted average yield of 1.5% as of June 30, 2020.
(1)The held-to-maturity investment securities had a weighted average yield of 3.3% as of December 31, 2019. Farmer Mac did not sell any securities from its available-for-sale investment portfolio during the three and six months ended June 30, 2020 and 2019. As of June 30, 2020 and December 31, 2019, unrealized losses on available-for-sale investment securities were as follows: Table 2.2
The unrealized losses presented above are principally due to a general widening of market spreads and changes in the levels of interest rates from the dates of acquisition to June 30, 2020 and December 31, 2019, as applicable. The resulting decrease in fair values reflects an increase in the perceived risk by the financial markets related to those securities. As of both June 30, 2020 and December 31, 2019, all of the investment securities in an unrealized loss position either were backed by the full faith and credit of the U.S. government or had credit ratings of at least "AA+." Securities in unrealized loss positions for 12 months or longer have a fair value as of June 30, 2020 that is, on average, approximately 98.9% of their amortized cost basis. Farmer Mac believes that all of these unrealized losses are recoverable within a reasonable period of time by way of maturity or changes in credit spreads. The amortized cost, fair value, and weighted-average yield of available-for-sale investment securities by remaining contractual maturity as of June 30, 2020 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. Table 2.3
The following tables set forth information about on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities as of June 30, 2020 and December 31, 2019: Table 3.1
(1)Amounts presented exclude $34.9 million, $35.3 million, and $0.2 million of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the statement of financial operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The trading USDA securities had a weighted average yield of 5.15% as of June 30, 2020.
(1)The trading USDA securities had a weighted average yield of 5.20% as of December 31, 2019. As of June 30, 2020 and December 31, 2019, unrealized losses on held-to-maturity and available-for-sale on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities were as follows: Table 3.2
The unrealized losses presented above are principally due to changes in interest rates from the date of acquisition to June 30, 2020 and December 31, 2019, as applicable. The unrealized losses on the held-to-maturity USDA Securities as of both June 30, 2020 and December 31, 2019 reflect their increased cost basis resulting from their transfer to held-to-maturity as of October 1, 2016. The credit exposure related to Farmer Mac's USDA Guarantees line of business is covered by the full faith and credit guarantee of the United States of America. As of June 30, 2020, Farmer Mac had executed COVID-19 payment deferments on loans with unpaid principal balances of $50.1 million underlying USDA Securities. The unrealized losses from AgVantage securities were on 13 and 17 available-for-sale securities as of June 30, 2020 and December 31, 2019, respectively. There were 0 and 4 held-to-maturity AgVantage securities with an unrealized loss as of June 30, 2020 and December 31, 2019, respectively. As of June 30, 2020 and December 31, 2019, 6 and 13 available-for-sale AgVantage securities, respectively, had been in a loss position for more than 12 months. During the three and six months ended June 30, 2020 and 2019, Farmer Mac had no sales of Farmer Mac Guaranteed Securities or USDA Securities and, therefore, Farmer Mac realized no gains or losses. The amortized cost, fair value, and weighted-average yield of available-for-sale and held-to-maturity Farmer Mac Guaranteed Securities and USDA Securities by remaining contractual maturity as of June 30, 2020 are set forth below. The balances presented are based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets. Table 3.3
(1)Amounts presented exclude $34.9 million of accrued interest receivable.
(1)Amounts presented exclude $35.3 million of accrued interest receivable.
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Farmer Mac Guaranteed Securities and USDA Securities |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FARMER MAC GUARANTEED SECURITES AND USDA SECURITIES | INVESTMENT SECURITIES The following tables set forth information about Farmer Mac's investment securities as of June 30, 2020 and December 31, 2019: Table 2.1
(1)Amounts presented exclude $6.6 million of accrued interest receivable on investment securities as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the consolidated statement of operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The held-to-maturity investment securities had a weighted average yield of 1.5% as of June 30, 2020.
(1)The held-to-maturity investment securities had a weighted average yield of 3.3% as of December 31, 2019. Farmer Mac did not sell any securities from its available-for-sale investment portfolio during the three and six months ended June 30, 2020 and 2019. As of June 30, 2020 and December 31, 2019, unrealized losses on available-for-sale investment securities were as follows: Table 2.2
The unrealized losses presented above are principally due to a general widening of market spreads and changes in the levels of interest rates from the dates of acquisition to June 30, 2020 and December 31, 2019, as applicable. The resulting decrease in fair values reflects an increase in the perceived risk by the financial markets related to those securities. As of both June 30, 2020 and December 31, 2019, all of the investment securities in an unrealized loss position either were backed by the full faith and credit of the U.S. government or had credit ratings of at least "AA+." Securities in unrealized loss positions for 12 months or longer have a fair value as of June 30, 2020 that is, on average, approximately 98.9% of their amortized cost basis. Farmer Mac believes that all of these unrealized losses are recoverable within a reasonable period of time by way of maturity or changes in credit spreads. The amortized cost, fair value, and weighted-average yield of available-for-sale investment securities by remaining contractual maturity as of June 30, 2020 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. Table 2.3
The following tables set forth information about on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities as of June 30, 2020 and December 31, 2019: Table 3.1
(1)Amounts presented exclude $34.9 million, $35.3 million, and $0.2 million of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the statement of financial operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The trading USDA securities had a weighted average yield of 5.15% as of June 30, 2020.
(1)The trading USDA securities had a weighted average yield of 5.20% as of December 31, 2019. As of June 30, 2020 and December 31, 2019, unrealized losses on held-to-maturity and available-for-sale on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities were as follows: Table 3.2
The unrealized losses presented above are principally due to changes in interest rates from the date of acquisition to June 30, 2020 and December 31, 2019, as applicable. The unrealized losses on the held-to-maturity USDA Securities as of both June 30, 2020 and December 31, 2019 reflect their increased cost basis resulting from their transfer to held-to-maturity as of October 1, 2016. The credit exposure related to Farmer Mac's USDA Guarantees line of business is covered by the full faith and credit guarantee of the United States of America. As of June 30, 2020, Farmer Mac had executed COVID-19 payment deferments on loans with unpaid principal balances of $50.1 million underlying USDA Securities. The unrealized losses from AgVantage securities were on 13 and 17 available-for-sale securities as of June 30, 2020 and December 31, 2019, respectively. There were 0 and 4 held-to-maturity AgVantage securities with an unrealized loss as of June 30, 2020 and December 31, 2019, respectively. As of June 30, 2020 and December 31, 2019, 6 and 13 available-for-sale AgVantage securities, respectively, had been in a loss position for more than 12 months. During the three and six months ended June 30, 2020 and 2019, Farmer Mac had no sales of Farmer Mac Guaranteed Securities or USDA Securities and, therefore, Farmer Mac realized no gains or losses. The amortized cost, fair value, and weighted-average yield of available-for-sale and held-to-maturity Farmer Mac Guaranteed Securities and USDA Securities by remaining contractual maturity as of June 30, 2020 are set forth below. The balances presented are based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets. Table 3.3
(1)Amounts presented exclude $34.9 million of accrued interest receivable.
(1)Amounts presented exclude $35.3 million of accrued interest receivable.
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Financial Derivatives |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL DERIVATIVES | FINANCIAL DERIVATIVESFarmer Mac enters into financial derivative transactions to protect against risk from the effects of market price, or interest rate movements, on the value of certain assets, future cash flows, or debt issuance, and not for trading or speculative purposes. For more information about Farmer Mac's financial derivatives, see Note 6 in Farmer Mac's Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed with the SEC on February 25, 2020. The following tables summarize information related to Farmer Mac's financial derivatives on a gross basis without giving consideration to master netting arrangements as of June 30, 2020 and December 31, 2019: Table 4.1
As of June 30, 2020, Farmer Mac expects to reclassify $5.3 million after tax from accumulated other comprehensive income to earnings over the next twelve months. This amount could differ from amounts actually recognized due to changes in interest rates, hedge de-designations, and the addition of other hedges after June 30, 2020. During the three and six months ended June 30, 2020 and 2019, there were no gains or losses from interest rate swaps designated as cash flow hedges reclassified to earnings because it was probable that the originally forecasted transactions would occur. The following table summarizes the net income/(expense) recognized in the consolidated statements of operations related to derivatives for the three and six months ended June 30, 2020 and 2019: Table 4.2
The following table shows the carrying amount and associated cumulative basis adjustment related to the application of hedge accounting that is included in the carrying amount of hedged assets and liabilities in fair value hedging relationships as of June 30, 2020 and December 31, 2019: Table 4.3
(1)Includes $0.4 million as of June 30, 2020 in fair value adjustment, currently included in "Prepaid expenses and other assets" related to a hedge of a purchase commitment of a loan. (2)Carrying amount represents amortized cost. The following table shows Farmer Mac's credit exposure to interest rate swap counterparties as of June 30, 2020 and December 31, 2019: Table 4.4
(1)Gross amount excludes netting arrangements and any adjustment for nonperformance risk, but includes accrued interest.
(1)Gross amount excludes netting arrangements and any adjustment for nonperformance risk, but includes accrued interest. As of June 30, 2020, Farmer Mac held $1.5 million of cash and no investment securities as collateral for its derivatives in net asset positions, compared to $2.7 million of cash and no investment securities as collateral for its derivatives in net asset positions as of December 31, 2019. Farmer Mac posted $17.6 million cash and $230.7 million of investment securities as of June 30, 2020 and posted $0.5 million cash and $131.7 million investment securities as of December 31, 2019. Farmer Mac records posted cash as a reduction in the outstanding balance of cash and cash equivalents and an increase in the balance of prepaid expenses and other assets. Any investment securities posted as collateral are included in the investment securities balances on the consolidated balance sheets. If Farmer Mac had breached certain provisions of the derivative contracts as of June 30, 2020 and December 31, 2019, it could have been required to settle its obligations under the agreements, but would not have been required to post additional collateral. As of June 30, 2020 and December 31, 2019, there were no financial derivatives in a net payable position where Farmer Mac was required to pledge collateral which the counterparty had the right to sell or repledge. Of Farmer Mac's $16.1 billion notional amount of interest rate swaps outstanding as of June 30, 2020, $13.3 billion were cleared through the swap clearinghouse, the Chicago Mercantile Exchange ("CME"). Of Farmer Mac's $14.0 billion notional amount of interest rate swaps outstanding as of December 31, 2019, $11.0 billion were cleared through the CME. During the first half of 2020 and throughout 2019, Farmer Mac increased its use of non-cleared basis swaps as it began to prepare for the transition away from the use of LIBOR as a reference rate. For more information about interest rate swaps cleared through a clearinghouse, see Note 6 in Farmer Mac's Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed with the SEC on February 25, 2020.
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Loans |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS | LOANS Loans held for investment are recorded at the unpaid principal balance, net of unamortized premium or discount and other cost basis adjustments. The following table displays the composition of the loan balances as of June 30, 2020 and December 31, 2019: Table 5.1
(1)Allowance for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained an allowance for losses to cover estimated probable incurred losses on loans held. (3)Unpaid principal balance is the basis of presentation in disclosures of outstanding balances for Farmer Mac's lines of business. Allowance for Losses The following table is a summary, by asset type, of the allowance for losses as of June 30, 2020 and December 31, 2019: Table 5.2
(1)Allowance for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained an allowance for loan losses to cover estimated probable incurred losses on loans held. The following is a summary of the changes in the allowance for losses for the three and six month period ended June 30, 2020 and 2019: Table 5.3
(1)Allowance for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained an allowance for loan losses to cover estimated probable incurred losses on loans held. (3)Allowance for losses includes $1.8 million for collateral dependent assets secured by commercial real estate. (4)Allowance for losses includes no allowance for collateral dependent assets. The cumulative transition adjustment decrease of $3.9 million in the Farm & Ranch portfolio was primarily driven by differences in the way that the two loss models measure the impact of low loan-to- value ratios in that portfolio. Under the previous accounting standard, Farmer Mac's estimated incurred loss model was based on historical weighted-average loss rates from realized losses within commodities and risk ratings. The historical weighted average loss rates were then applied to sub-portfolios, as disaggregated by commodity and risk rating, to calculate the general allowance. Under the CECL accounting standard, Farmer Mac's current expected credit losses are calculated individually based on the expected probability of default and the expected loss-given-default for each loan. The low loan-to-value ratios in the Farm & Ranch portfolio result in low individual losses-given-default. Thus, our expected credit losses as of January 1, 2020 were less than our estimate of incurred losses as of December 31, 2019. The cumulative transition adjustment increase of $5.4 million in the Rural Utilities portfolio was primarily driven by the change from measuring incurred probable credit losses to measuring expected credit losses over the expected lives of these loans. Farmer Mac has never experienced a credit loss in its Rural Utilities portfolio. Additionally, these loans have strong credit ratings and performance, which supported Farmer Mac's estimate of no incurred credit losses under the previous accounting standard. Upon the adoption of CECL, Farmer Mac is now required to measure its expected credit losses for the entire expected life of all financial instruments, including its Rural Utilities loans. To estimate expected credit losses on these loans, Farmer Mac relies upon industry data from ratings agencies and publicly available information as disclosed in the securities filings of other major lenders who serve the utilities industry. Under the CECL accounting standard, Farmer Mac's loss allowance model for these loans is primarily impacted by the long-term maturities of the loans and their low probability of prepayment. In addition, the highly-specialized nature of power generation and transmission facilities results in significant losses given default even though the probability of default is low. Thus, the long-term expected lives of these loans combined with high losses given default result in an estimate of expected losses although we have never incurred a credit loss in this portfolio. The provision to the allowance for loan losses of $0.5 million recorded during second quarter 2020 was primarily due to the impact of net new loan volume in the Rural Utilities portfolio of $311.8 million. The impact of the Rural Utilities portfolio on the net increase to the provision was partially offset by improving economic factors that uniquely impacted the Farm & Ranch portfolio, specifically improvements in commodity prices and expectations for stable farm land values. In addition, there was a $0.4 million charge-off to the allowance related to the acquisition of a new real estate owned property ("REO") during second quarter 2020. The provision to the allowance for loan losses of $3.4 million recorded during the six months ended June 30, 2020 was primarily due to the impact of net new loan volume in the Rural Utilities portfolio and the impact of economic factor forecasts on the Rural Utilities portfolio, especially expected higher unemployment, as a result of the COVID-19 pandemic and the resulting economic volatility. The provision for the allowance for loan losses recorded during three and six months ended June 30, 2019 was attributable to an increase in the general allowance due to net volume growth in on-balance sheet Farm & Ranch loans and a slight decrease in the portfolio credit quality. The following table presents the unpaid principal balances by delinquency status of Farmer Mac's loans and non-performing assets as of June 30, 2020: Table 5.4
(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)Includes loans in consolidated trusts with beneficial interests owned by third parties that are 90 days or more past due. (3)Includes loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. (4)Includes $23.1 million of nonaccrual loans for which there was no associated allowance. During the three and six months ended June 30, 2020, Farmer Mac received $1.3 million and 2.3 million, respectively, in interest on nonaccrual loans. (5)Includes $82.2 million of unpaid principal balance related to Farm & Ranch loans that Farmer Mac has executed a COVID-19 payment deferment. The following tables present the unpaid principal balances of loans held and the related total allowance for losses by impairment method and commodity type as of December 31, 2019: Table 5.5
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 December 31, 2019: Table 5.6
(1)Impairment analysis was performed in the aggregate in consideration of similar risk characteristics of the assets and historical statistics on $159.1 million (70%) of impaired loans as of December 31, 2019, which resulted in a specific allowance of $3.0 million. (2)Includes $30.1 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 and six months ended June 30, 2019: Table 5.7
Net credit losses and 90-day delinquencies as of and for the periods indicated for loans held are presented in the table below. As of December 31, 2019, 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
(1)Includes loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. Of the $57.7 million of on-balance sheet loans reported as 90-day delinquencies as of December 31, 2019, no loans were subject to "removal-of-account" provisions. Rural Utilities As of December 31, 2019, no allowance for losses had been provided for Farmer Mac's Rural Utilities line of business based on the performance of the loans in this line of business and the credit quality of the collateral supporting these loans, as well as Farmer Mac's counterparty risk analysis. As of December 31, 2019, there were no delinquencies or probable losses inherent in Farmer Mac's Rural Utilities loans held or underlying LTSPCs. Credit Quality Indicators The following tables present credit quality indicators related to Farm & Ranch loans and Rural Utilities loans held as of June 30, 2020, by year of origination: Table 5.9
(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.
(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. The following table presents credit quality indicators related to Farm & Ranch loans held as of December 31, 2019: Table 5.10
(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.
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Guarantees |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GUARANTEES | GUARANTEES The following table presents the maximum principal amount of potential undiscounted future payments that Farmer Mac could be required to make under all off-balance sheet Farmer Mac Guaranteed Securities as of June 30, 2020 and December 31, 2019, not including offsets provided by any recourse provisions, recoveries from third parties, or collateral for the underlying loans: Table 6.1
Eligible loans and other eligible assets may be placed into trusts that are used as vehicles for the securitization of the transferred assets and the Farmer Mac-guaranteed beneficial interests in the trusts are sold to investors. The following table summarizes the significant cash flows received from and paid to trusts used for Farmer Mac securitizations: Table 6.2
Farmer Mac presents a liability for its obligation to stand ready under its guarantee in "Guarantee and commitment obligation" on the consolidated balance sheets. The following table presents the liability and the weighted-average remaining maturity of all loans underlying off-balance sheet Farmer Mac Guaranteed Securities: Table 6.3
Long-Term Standby Purchase Commitments Farmer Mac has recorded a liability for its obligation to stand ready under the guarantee in the guarantee and commitment obligation on the consolidated balance sheets. The following table presents the liability, the maximum principal amount of potential undiscounted future payments that Farmer Mac could be requested to make under all LTSPCs, not including offsets provided by any recourse provisions, recoveries from third parties, or collateral for the underlying loans, as well as the weighted-average remaining maturity of all loans underlying LTSPCs: Table 6.4
(1) Relates to LTSPCs issued or modified on or after January 1, 2003. Reserve for Losses The following table is a summary, by asset type, of the reserve for losses as of June 30, 2020 and December 31, 2019: Table 6.5
(1)Reserve for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained a reserve for losses to cover estimated probable incurred losses on loans underlying LTSPCs and off-balance sheet Farm & Ranch Farmer Mac Guaranteed Securities. The following is a summary of the changes in the reserve for losses for the three and six month period ended June 30, 2020 and 2019: Table 6.6
(1)Reserve for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained a reserve for losses to cover estimated probable incurred losses on loans underlying LTSPCs and off-balance sheet Farm & Ranch Farmer Mac Guaranteed Securities. The release from the reserve for losses recorded during the three and six months ended June 30, 2020 was primarily due to the net decreases in LTSPC volume of $58.5 million and $119.3 million, respectively. The following table presents the unpaid principal balances by delinquency status of Farm & Ranch loans underlying LTSPCs. Farm & Ranch Farmer Mac Guaranteed Securities, Rural Utilities loans underlying LTSPCs, and non-performing assets as of June 30, 2020: Table 6.7
(1)Includes loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days of more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. (2)Includes $109.5 million of unpaid principal balance related to Farm & Ranch LTSPCs for which the lender has notified Farmer Mac of an executed COVID-19 payment deferment. The following tables present the unpaid principal balances of Farm & Ranch loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities (excluding AgVantage securities) and the related reserve for losses by impairment method and commodity type as of December 31, 2019: Table 6.8
Net credit losses and 90-day delinquencies as of and for the periods indicated for loans underlying off-balance sheet securities representing interests in pools of eligible Farm & Ranch LTSPCs are presented in the table below. As of December 31, 2019, there were no delinquencies and no probable losses inherent in Farmer Mac's Rural Utilities LTSPCs portfolio and Farmer Mac had not experienced credit losses on any Rural Utilities LTSPCs. Table 6.9
(1)Includes loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. Credit Quality Indicators The following tables present credit quality indicators related to Farm & Ranch loans underlying LTSPCs, Farm & Ranch Farmer Mac Guaranteed Securities, and Rural Utilities loans underlying LTSPCs as of June 30, 2020, by year of origination: Table 6.10
(1)Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured. (2)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.
(1)Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured. (2)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. The following table presents credit quality indicators related to Farm & Ranch loans underlying LTSPCs and off-balance sheet Farm & Ranch Farmer Mac Guaranteed Securities as of December 31, 2019: Table 6.11
(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.
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Notes Payable |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOTES PAYABLE | NOTES PAYABLE Farmer Mac's borrowings consist of discount notes and medium-term notes, both of which are unsecured general obligations of Farmer Mac. Discount notes generally have original maturities of 1.0 year or less, whereas medium-term notes generally have maturities of 0.5 years to 15.0 years. The following tables set forth information related to Farmer Mac's borrowings as of June 30, 2020 and December 31, 2019: Table 7.1
During the six months ended June 30, 2020, Farmer Mac increased its use of short-term funding in order to fund the growth of short-term assets in its liquidity portfolio. The maximum amount of Farmer Mac's discount notes outstanding at any month end during the six months ended June 30, 2020 and 2019 was $2.6 billion and $2.1 billion, respectively. Callable medium-term notes give Farmer Mac the option to redeem the debt at par value on a specified call date or at any time on or after a specified call date. The following table summarizes by maturity date the amounts and costs for Farmer Mac debt callable in 2020 as of June 30, 2020: Table 7.2
The following schedule summarizes the earliest interest rate reset date, or debt maturities, of total borrowings outstanding as of June 30, 2020, including callable and non-callable medium-term notes, assuming callable notes are redeemed at the initial call date: Table 7.3
During the six months ended June 30, 2020 and 2019, Farmer Mac called $1.9 billion and $0.3 billion of callable medium-term notes, respectively. The decrease in market interest rates throughout 2019 and continuing into the first half of 2020 led to an increase in called medium-term notes compared to the prior year. Authority to Borrow from the U.S. Treasury Farmer Mac's statutory charter authorizes it, upon satisfying certain conditions, to borrow up to $1.5 billion from the U.S. Treasury through the issuance of debt obligations to the U.S. Treasury. Any funds borrowed from the U.S. Treasury may be used solely for the purpose of fulfilling Farmer Mac's guarantee obligations. Any debt obligations issued by Farmer Mac under this authority would bear interest at a rate determined by the U.S. Treasury, taking into consideration the average rate on outstanding marketable obligations of the United States as of the last day of the last calendar month ending before the date of the purchase of the obligations from Farmer Mac. The charter requires Farmer Mac to repurchase any of its debt obligations held by the U.S. Treasury within a reasonable time. As of June 30, 2020, Farmer Mac had not used this borrowing authority. Gains on Repurchase of Outstanding Debt No outstanding debt repurchases were made in the six months ended June 30, 2020 or 2019.
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Equity |
6 Months Ended |
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Equity [Abstract] | |
EQUITY | EQUITY Preferred Stock In May 2020, Farmer Mac issued 3.2 million shares of 5.750% non-cumulative perpetual Series E preferred stock, par value $25.00 per share. Farmer Mac incurred direct costs of $2.5 million related to the issuance of the Series E preferred stock. The dividend rate on the Series E preferred stock will remain at a non-cumulative, fixed rate of 5.750% per year, when, as, and if a dividend is declared by the Board of Directors of Farmer Mac, for so long as the Series E preferred stock remains outstanding. The Series E preferred stock has no maturity date, but Farmer Mac has the option to redeem the preferred stock at any time on any dividend payment date on and after July 17, 2025. Common Stock During first and second quarter 2020, Farmer Mac paid a quarterly dividend of $0.80 per share on all classes of its common stock. For each quarter in 2019, Farmer Mac paid a quarterly dividend of $0.70 per share on all classes of its common stock. Farmer Mac's board of directors approved a share repurchase program during third quarter 2015 authorizing Farmer Mac to repurchase up to $25.0 million of its outstanding Class C non-voting common stock. The share repurchase program, last modified on March 14, 2019, authorized Farmer Mac to repurchase up to $10.0 million of Farmer Mac's outstanding Class C non-voting common stock. During first quarter 2020, Farmer Mac repurchased approximately 4,000 shares of Class C non-voting common stock at a cost of approximately $0.2 million. Shortly after these repurchases were completed, Farmer Mac indefinitely suspended its share repurchase program in an effort to preserve capital and liquidity in view of market volatility and uncertainty caused by the COVID-19 pandemic. As of June 30, 2020, Farmer Mac had repurchased approximately 673,000 shares of Class C non-voting common stock at a cost of approximately $19.8 million under the share repurchase program since 2015. The program expires at the end of March 2021. Capital Requirements Farmer Mac is required to comply with the higher of the minimum capital requirement and the risk-based capital requirement. As of both June 30, 2020 and December 31, 2019, the minimum capital requirement was greater than the risk-based capital requirement. Farmer Mac's ability to declare and pay dividends could be restricted if it fails to comply with applicable capital requirements. As of June 30, 2020, Farmer Mac's minimum capital requirement was $667.7 million and its core capital level was $915.6 million, which was $247.9 million above the minimum capital requirement as of that date. As of December 31, 2019, Farmer Mac's minimum capital requirement was $618.8 million and its core capital level was $815.4 million, which was $196.6 million above the minimum capital requirement as of that date. In accordance with the Farm Credit Administration's rule on Farmer Mac's capital planning, and as part of Farmer Mac's capital plan, Farmer Mac has adopted a policy for maintaining a sufficient level of Tier 1 capital (consisting of retained earnings, paid-in-capital, common stock, and qualifying preferred stock) and imposing restrictions on Tier 1-eligible dividends and any discretionary bonus payments in the event that this capital falls below specified thresholds.
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Fair Value Disclosures |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE DISCLOSURES | FAIR VALUE DISCLOSURES Fair Value Classification and Transfers The following tables present information about Farmer Mac's assets and liabilities measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, respectively, and indicate the fair value hierarchy of the valuation techniques used by Farmer Mac to determine such fair value: Table 9.1
(1) Level 3 assets represent 33% of total assets and 69% of financial instruments measured at fair value.
(1) Level 3 assets represent 33% of total assets and 71% of financial instruments measured at fair value. There were no significant assets or liabilities measured at fair value on a non-recurring basis as of June 30, 2020 or December 31, 2019. Transfers in and/or out of the different levels within the fair value hierarchy are based on the fair values of the assets and liabilities as of the beginning of the reporting period. During the first half of 2020 and 2019, there were no transfers within the fair value hierarchy for fair value measurements of Farmer Mac's investment securities, Farmer Mac Guaranteed Securities, USDA Securities, and financial derivatives. The following tables present additional information about assets and liabilities measured at fair value on a recurring basis for which Farmer Mac has used significant unobservable inputs to determine fair value. Net transfers in and/or out of Level 3 are based on the fair values of the assets and liabilities as of the beginning of the reporting period. There were no liabilities measured at fair value using significant unobservable inputs during the three and six months ended June 30, 2020 and 2019. Table 9.2
The following tables present additional information about the significant unobservable inputs, such as discount rates and constant prepayment rates ("CPR"), used in the fair value measurements categorized in Level 3 of the fair value hierarchy as of June 30, 2020 and December 31, 2019: Table 9.3
The significant unobservable input used in the fair value measurements of AgVantage Farmer Mac Guaranteed Securities is the discount rate commensurate with the risks involved. Typically, significant increases (decreases) in this input in isolation may result in materially lower (higher) fair value measurements. Generally, in a rising interest rate environment, Farmer Mac would expect average discount rates to increase. Conversely, in a declining interest rate environment, Farmer Mac would expect average discount rates to decrease. Prepayment rates are not presented in the table above for AgVantage securities because they generally have fixed maturity dates when the secured general obligations are due and don't prepay. The significant unobservable inputs used in the fair value measurements of USDA Securities are the prepayment rate and discount rate commensurate with the risks involved. Typically, significant increases (decreases) in any of these inputs in isolation may result in materially lower (higher) fair value measurements. Generally, in a rising interest rate environment, Farmer Mac would expect average discount rates to increase and would likely expect a corresponding decrease in forecasted prepayment rates. Conversely, in a declining interest rate environment, Farmer Mac would expect average discount rates to decrease and would likely expect a corresponding increase in forecasted prepayment rates. Disclosures on Fair Value of Financial Instruments The following table sets forth the estimated fair values and carrying values for financial assets, liabilities, and guarantees and commitments as of June 30, 2020 and December 31, 2019: Table 9.4
The carrying value of cash and cash equivalents is a reasonable estimate of their approximate fair value and is classified as Level 1. The fair value of investments in U.S. Treasuries are valued based on unadjusted quoted prices in active markets and are classified as Level 1. A significant portion of Farmer Mac's investment portfolio is valued using a reputable nationally recognized third-party pricing service. The prices obtained are non-binding and generally representative of recent market trades and are classified as Level 2. Farmer Mac internally models the fair value of its loan portfolio, including loans held for investment and loans held for investment in consolidated trusts, Farmer Mac Guaranteed Securities, and USDA Securities by discounting the projected cash flows of these instruments at projected interest rates. The fair values are based on the present value of expected cash flows using management's best estimate of certain key assumptions, which include prepayment speeds, forward yield curves and discount rates commensurate with the risks involved. These fair value measurements do not take into consideration the fair value of the underlying property and are classified as Level 3. Financial derivatives primarily are valued using unadjusted counterparty valuations and are classified as Level 2. The fair value of the guarantee fees receivable/obligation and debt securities of consolidated trusts are estimated based on the present value of expected future cash flows of the underlying mortgage assets using management's best estimate of certain key assumptions, which include prepayments speeds, forward yield curves, and discount rates commensurate with the risks involved and are classified as Level 3. Notes payable are valued by discounting the expected cash flows of these instruments using a yield curve derived from market prices observed for similar agency securities and are also classified as Level 3. Because the cash flows of Farmer Mac's financial instruments may be interest rate path dependent, estimated fair values and projected discount rates for Level 3 financial instruments are derived using a Monte Carlo simulation model. Different market assumptions and estimation methodologies could significantly affect estimated fair value amounts.
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Business Segment Reporting |
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Jun. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BUSINESS SEGMENT REPORTING | BUSINESS SEGMENT REPORTING The following tables present core earnings for Farmer Mac's operating segments and a reconciliation to consolidated net income for the three and six months ended June 30, 2020 and 2019: Table 10.1
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
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Summary of Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Farmer Mac and its two subsidiaries during the year: (1) Farmer Mac Mortgage Securities Corporation ("FMMSC"), whose principal activities are to facilitate the purchase and issuance of Farmer Mac Guaranteed Securities; and (2) Farmer Mac II LLC, whose principal activity is the operation of substantially all of the business related to the USDA Guarantees line of business – primarily the acquisition of USDA Securities. The consolidated financial statements also include the accounts of Variable Interest Entities ("VIEs") in which Farmer Mac determined itself to be the primary beneficiary.
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Earnings Per Common Share | Earnings Per Common ShareBasic earnings per common share ("EPS") is based on the daily weighted-average number of shares of common stock outstanding. Diluted earnings per common share is based on the daily weighted-average number of shares of common stock outstanding adjusted to include all potentially dilutive stock appreciation rights ("SARs") and unvested restricted stock awards. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income | Comprehensive IncomeComprehensive income represents all changes in stockholders' equity except those resulting from investments by or distributions to stockholders, and is comprised of net income and unrealized gains and losses on available-for-sale securities, certain held-to-maturity securities transferred from the available-for-sale classification, and cash flow hedges, net of related taxes. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Expected Credit Losses and Reserve for Credit Losses | On January 1, 2020, Farmer Mac adopted Accounting Standards Update 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, ("CECL"). Under CECL, Farmer Mac's allowance for credit losses represents the difference between the carrying amount of the related financial instruments and the present value of their expected cash flows discounted at their effective interest rates, as of the respective balance sheet date. Under CECL, Farmer Mac's reserve for credit losses represents the difference between the outstanding amount of off-balance sheet credit exposures and the present value of their expected cash flows discounted at their effective interest rates. Farmer Mac maintains an allowance for credit losses to cover current expected credit losses as of the balance sheet date for on-balance sheet investment securities, loans held for investment, and Farmer Mac Guaranteed Securities (collectively referred to as "allowance for losses"). Additionally, Farmer Mac maintains a reserve for credit losses to cover current expected credit losses as of the balance sheet date for off-balance sheet loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities (collectively referred to as "reserve for losses"). Both the allowance for losses and reserve for losses are based on historical information and reasonable and supportable forecasts. Farmer Mac has never experienced a credit loss in its Rural Utilities line of business. Upon the adoption of CECL, Farmer Mac is now required to measure its expected credit losses for the expected life of all financial instruments, including its Rural Utilities loans. To estimate expected credit losses on these loans, Farmer Mac relies upon industry historical credit loss data from ratings agencies and publicly available information as disclosed in the securities filings of other major lenders who serve the utilities industry. The allowance for losses increases through periodic provisions for loan losses that are charged against net interest income and the reserve for losses increases through provisions for losses that are charged to non-interest expense. Both the allowance for losses and reserve for losses are decreased by charge-offs for realized losses, net of recoveries. Releases from the allowance for losses or reserve for losses occur when the estimate of expected credit losses as of the end of a period is less than the estimate at the beginning of the period. The total allowance for losses consists of the allowance for losses and the reserve for losses. Charge-offs Farmer Mac records a charge-off against the allowance for losses principally when a loss has been confirmed through the receipt of assets, generally the underlying collateral, in full satisfaction of the loan. The loss equals the excess of the recorded investment in the loan over the fair value of the collateral less estimated selling costs. Estimation Methodology Farmer Mac bases its methodology for determining its current estimate of expected losses on a statistical model, which incorporates credit loss history and reasonable and supportable forecasts. Farmer Mac's estimation methodology is comprised of the following key components: •An economic model for each portfolio, including Farm & Ranch, Rural Utilities, and Institutional Credit; •A migration matrix for each portfolio that reasonably predicts the movement of each financial asset among various risk categories over the course of each asset's expected life. The migration matrix forms the basis for our estimate of the probability of default of each financial asset; •A loss-given-default ("LGD") model that reasonably predicts the amount of loss that Farmer Mac would incur upon the default of each financial asset; •An economic factor forecast that updates the migration matrix model and the LGD model with current assumptions for the economic indicators that Farmer Mac has determined are most correlated with or relevant to the performance of each portfolio of assets; including Gross Domestic Product ("GDP"), credit spreads, unemployment rates, land values, and commodity prices; and •A discounted cash flow analysis, which relies upon each of the above model outputs, plus the contractual terms of each financial asset, and the effective interest rate of each financial asset. Management evaluates these assumptions by considering many relevant factors, including: •economic conditions; •geographic and agricultural commodity/product concentrations in the portfolio; •the credit profile of the portfolio, including risk ratings and financial metrics; •delinquency trends of the portfolio; •historical charge-off and recovery activities of the portfolio; and •other factors to capture current portfolio trends and characteristics that differ from historical experience. Management believes that its methodology produces a reasonable estimate of expected credit losses, as of the balance sheet date, for the expected life of all of its financial assets. Allowance for Loss on Available-for-Sale (AFS) Securities To measure current expected credit losses on impaired AFS securities, Farmer Mac first considers those impaired securities that: 1) Farmer Mac does not intend to sell, and 2) it is not more likely than not that Farmer Mac will be required to sell before recovering its amortized cost basis. In assessing whether a credit loss exists, Farmer Mac compares the present value, discounted at the security's effective interest rate, of cash flows expected to be collected from an impaired AFS debt security to its amortized cost basis. If the present value of cash flows expected to be collected is less than the amortized cost basis of the impaired security, a credit loss exists and Farmer Mac records an allowance for loss for that credit loss. However, the amount of that allowance is limited by the amount that the security’s fair value is less than its amortized cost basis. Accrued interest receivable is recorded separately on the Consolidated Balance Sheet, and the allowance for credit losses excludes uncollectible accrued interest receivable. Collateral Dependent Assets ("CDAs") CDAs are loans, loans underlying LTSPCs, or off-balance sheet credit exposures in which the borrower is either in foreclosure or is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral by Farmer Mac. Farmer Mac estimates the current expected credit loss on CDAs based upon the appraised value of the collateral, the costs to sell it, and any applicable credit protection such as a guarantee. COVID-19 Payment Deferments The Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was signed into law on March 27, 2020. Section 4013 of the CARES Act titled “Temporary Relief from Troubled Debt Restructurings” provides financial institutions the option to temporarily suspend certain requirements under U.S. GAAP related to troubled debt restructurings (“TDRs”) for a limited period of time to account for the effects of the novel coronavirus disease 2019 ("COVID-19"). On April 10, 2020, Farmer Mac’s prudential regulator, the Office of Secondary Market Oversight (OSMO) within the Farm Credit Administration (FCA), issued guidance to Farmer Mac on loan servicing and reporting TDRs for lines of business affected by the COVID-19 outbreak. This guidance was consistent with the guidance provided by other financial regulatory agencies and the Financial Accounting Standards Board that short-term modifications made on a good faith basis in response to the COVID-19 national emergency are not TDRs when the borrower was not past due on loan payments before the March 13, 2020 presidential proclamation declaring the COVID-19 outbreak a national emergency. During second quarter 2020, Farmer Mac implemented the guidance from FCA by granting up to 6-month payment deferments to borrowers who have been economically impacted by COVID-19. Farmer Mac deems loans under a COVID-19 payment deferment not to be past due and continues to accrue interest on those loans. Furthermore, Farmer Mac does not consider a payment deferment on any such loan to be a troubled debt restructuring. For the purpose of estimating expected credit losses on Farm & Ranch loans held for investment, Farmer Mac does consider payment deferments along with other available credit and economic information that pertains to that portfolio.
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New Accounting Standards | New Accounting Standards Recently Adopted Accounting Guidance
The following table presents the impact of adopting on January 1, 2020 on our allowance and retained earnings: Table 1.5
Recently Issued Accounting Guidance, Not Yet Adopted Within Our Consolidated Financial Statements
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Reclassifications | ReclassificationsCertain reclassifications of prior period information were made to conform to the current period presentation. |
Summary of Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Consolidation of Variable Interest Entities | The following tables present, by line of business, details about the consolidation of VIEs: Table 1.1
(1)Includes borrower remittances of $40.9 million. The borrower remittances had not been passed through to third party investors as of June 30, 2020. (2)Includes $0.1 million of unamortized premiums and discounts and fair value adjustments related to the USDA Guarantees line of business. (3)Farmer Mac uses unpaid principal balance and outstanding face amount of investment securities to represent maximum exposure to loss. (4)Includes auction-rate certificates, asset-backed securities, and government-sponsored enterprise ("GSE")-guaranteed mortgage-backed securities. (5)The amount under the Farm & Ranch line of business relates to unconsolidated trusts where Farmer Mac determined it was not the primary beneficiary due to shared power with an unrelated party.
(1)Includes borrower remittances of $15.6 million. The borrower remittances had not been passed through to third party investors as of December 31, 2019. (2)Includes $0.2 million of unamortized premiums and discounts and fair value adjustments related to the USDA Guarantees line of business. (3)Farmer Mac uses unpaid principal balance and outstanding face amount of investment securities to represent maximum exposure to loss. (4)Includes auction-rate certificates, asset-backed securities, and government-sponsored enterprise ("GSE")-guaranteed mortgage-backed securities. (5)The amount under the Farm & Ranch line of business relates to unconsolidated trusts where Farmer Mac determined it was not the primary beneficiary due to shared power with an unrelated party.
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Basic and Diluted EPS | The following schedule reconciles basic and diluted EPS for the three and six months ended June 30, 2020 and 2019: Table 1.2
(1)For the three months ended June 30, 2020 and 2019, SARs and restricted stock of 83,297 and 62,660, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive. For the three months ended June 30, 2020 and 2019, contingent shares of unvested restricted stock of 12,680 and 12,284, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.
(1)For the six months ended June 30, 2020 and 2019, SARs and restricted stock of 85,223 and 59,818, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive. For the six months ended June 30, 2020 and 2019, contingent shares of unvested restricted stock of 12,680 and 12,284, respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.
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Schedule of Accumulated Other Comprehensive Income, Net of Tax | The following table presents the changes in accumulated other comprehensive income ("AOCI"), net of tax, by component for the three and six months ended June 30, 2020 and 2019: Table 1.3
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Schedule of Reclassification out of Accumulated Other Comprehensive Income | The following table presents other comprehensive income activity, the impact on net income of amounts reclassified from each component of AOCI, and the related tax impact for the three and six months ended June 30, 2020 and 2019: Table 1.4
(1)Relates to the amortization of unrealized gains on hedged items prior to the application of fair value hedge accounting. (2)Represents amortization of deferred gains related to certain available-for-sale USDA Securities and Farmer Mac Guaranteed USDA Securities. (3)Relates to the amortization of unrealized gains or losses prior to the reclassification of these securities from available-for-sale to held-to-maturity. The amortization of unrealized gains or losses reported in AOCI for held-to-maturity securities will be offset by the amortization of the premium or discount created from the transfer into held-to-maturity securities, which occurred at fair value. These unrealized gains or losses will be recorded over the remaining life of the security with no impact on future net income. (4)Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI.
(1)Relates to the amortization of unrealized gains on hedged items prior to the application of fair value hedge accounting. (2)Represents amortization of deferred gains related to certain available-for-sale USDA Securities and Farmer Mac Guaranteed USDA Securities. (3)Relates to the amortization of unrealized gains or losses prior to the reclassification of these securities from available-for-sale to held-to-maturity. The amortization of unrealized gains or losses reported in AOCI for held-to-maturity securities will be offset by the amortization of the premium or discount created from the transfer into held-to-maturity securities, which occurred at fair value. These unrealized gains or losses will be recorded over the remaining life of the security with no impact on future net income. (4)Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI.
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Recently Adopted Accounting Guidance and Recently Issued Accounting Guidance, Note Yet Adopted Within Out Consolidated Financial Statements | Recently Adopted Accounting Guidance
The following table presents the impact of adopting on January 1, 2020 on our allowance and retained earnings: Table 1.5
Recently Issued Accounting Guidance, Not Yet Adopted Within Our Consolidated Financial Statements
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Investment Securities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Farmer Mac Investment Securities | The following tables set forth information about Farmer Mac's investment securities as of June 30, 2020 and December 31, 2019: Table 2.1
(1)Amounts presented exclude $6.6 million of accrued interest receivable on investment securities as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the consolidated statement of operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The held-to-maturity investment securities had a weighted average yield of 1.5% as of June 30, 2020.
(1)The held-to-maturity investment securities had a weighted average yield of 3.3% as of December 31, 2019. The following tables set forth information about on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities as of June 30, 2020 and December 31, 2019: Table 3.1
(1)Amounts presented exclude $34.9 million, $35.3 million, and $0.2 million of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the statement of financial operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The trading USDA securities had a weighted average yield of 5.15% as of June 30, 2020.
(1)The trading USDA securities had a weighted average yield of 5.20% as of December 31, 2019.
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Schedule of Unrealized Losses on Available-for-Sale Investment Securities | As of June 30, 2020 and December 31, 2019, unrealized losses on available-for-sale investment securities were as follows: Table 2.2
As of June 30, 2020 and December 31, 2019, unrealized losses on held-to-maturity and available-for-sale on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities were as follows: Table 3.2
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Schedule of Available-for-Sale Securities Maturities | The amortized cost, fair value, and weighted-average yield of available-for-sale investment securities by remaining contractual maturity as of June 30, 2020 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. Table 2.3
The amortized cost, fair value, and weighted-average yield of available-for-sale and held-to-maturity Farmer Mac Guaranteed Securities and USDA Securities by remaining contractual maturity as of June 30, 2020 are set forth below. The balances presented are based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets. Table 3.3
(1)Amounts presented exclude $34.9 million of accrued interest receivable.
(1)Amounts presented exclude $35.3 million of accrued interest receivable.
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Farmer Mac Guaranteed Securities and USDA Securities (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Farmer Mac Guaranteed Securities and USDA Securities | The following tables set forth information about Farmer Mac's investment securities as of June 30, 2020 and December 31, 2019: Table 2.1
(1)Amounts presented exclude $6.6 million of accrued interest receivable on investment securities as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the consolidated statement of operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The held-to-maturity investment securities had a weighted average yield of 1.5% as of June 30, 2020.
(1)The held-to-maturity investment securities had a weighted average yield of 3.3% as of December 31, 2019. The following tables set forth information about on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities as of June 30, 2020 and December 31, 2019: Table 3.1
(1)Amounts presented exclude $34.9 million, $35.3 million, and $0.2 million of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of June 30, 2020. (2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the statement of financial operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors. (3)The trading USDA securities had a weighted average yield of 5.15% as of June 30, 2020.
(1)The trading USDA securities had a weighted average yield of 5.20% as of December 31, 2019.
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Schedule of Unrealized Losses on Available-for-Sale Investment Securities | As of June 30, 2020 and December 31, 2019, unrealized losses on available-for-sale investment securities were as follows: Table 2.2
As of June 30, 2020 and December 31, 2019, unrealized losses on held-to-maturity and available-for-sale on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities were as follows: Table 3.2
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Schedule of Available-for-Sale and Held-to-Maturity Securities Maturities | The amortized cost, fair value, and weighted-average yield of available-for-sale investment securities by remaining contractual maturity as of June 30, 2020 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. Table 2.3
The amortized cost, fair value, and weighted-average yield of available-for-sale and held-to-maturity Farmer Mac Guaranteed Securities and USDA Securities by remaining contractual maturity as of June 30, 2020 are set forth below. The balances presented are based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets. Table 3.3
(1)Amounts presented exclude $34.9 million of accrued interest receivable.
(1)Amounts presented exclude $35.3 million of accrued interest receivable.
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Financial Derivatives (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position | The following tables summarize information related to Farmer Mac's financial derivatives on a gross basis without giving consideration to master netting arrangements as of June 30, 2020 and December 31, 2019: Table 4.1
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Schedule of Net Income/(Expense) Recognized | The following table summarizes the net income/(expense) recognized in the consolidated statements of operations related to derivatives for the three and six months ended June 30, 2020 and 2019: Table 4.2
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Schedule of Hedged Items in Fair Value Hedging Relationships | The following table shows the carrying amount and associated cumulative basis adjustment related to the application of hedge accounting that is included in the carrying amount of hedged assets and liabilities in fair value hedging relationships as of June 30, 2020 and December 31, 2019: Table 4.3
(1)Includes $0.4 million as of June 30, 2020 in fair value adjustment, currently included in "Prepaid expenses and other assets" related to a hedge of a purchase commitment of a loan. (2)Carrying amount represents amortized cost.
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Schedule of Credit Exposure to Interest Rate Swap Counterparties | The following table shows Farmer Mac's credit exposure to interest rate swap counterparties as of June 30, 2020 and December 31, 2019: Table 4.4
(1)Gross amount excludes netting arrangements and any adjustment for nonperformance risk, but includes accrued interest.
(1)Gross amount excludes netting arrangements and any adjustment for nonperformance risk, but includes accrued interest.
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Loans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Composition of Loan Balances | The following table displays the composition of the loan balances as of June 30, 2020 and December 31, 2019: Table 5.1
(1)Allowance for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained an allowance for losses to cover estimated probable incurred losses on loans held. (3)Unpaid principal balance is the basis of presentation in disclosures of outstanding balances for Farmer Mac's lines of business.
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Schedule Allowance for Losses | The following table is a summary, by asset type, of the allowance for losses as of June 30, 2020 and December 31, 2019: Table 5.2
(1)Allowance for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained an allowance for loan losses to cover estimated probable incurred losses on loans held. The following is a summary of the changes in the allowance for losses for the three and six month period ended June 30, 2020 and 2019: Table 5.3
(1)Allowance for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained an allowance for loan losses to cover estimated probable incurred losses on loans held. (3)Allowance for losses includes $1.8 million for collateral dependent assets secured by commercial real estate. (4)Allowance for losses includes no allowance for collateral dependent assets.
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Schedule of Past Due Financing Receivables | The following table presents the unpaid principal balances by delinquency status of Farmer Mac's loans and non-performing assets as of June 30, 2020: Table 5.4
(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)Includes loans in consolidated trusts with beneficial interests owned by third parties that are 90 days or more past due. (3)Includes loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. (4)Includes $23.1 million of nonaccrual loans for which there was no associated allowance. During the three and six months ended June 30, 2020, Farmer Mac received $1.3 million and 2.3 million, respectively, in interest on nonaccrual loans. (5)Includes $82.2 million of unpaid principal balance related to Farm & Ranch loans that Farmer Mac has executed a COVID-19 payment deferment. Net credit losses and 90-day delinquencies as of and for the periods indicated for loans held are presented in the table below. As of December 31, 2019, 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
(1)Includes loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. The following table presents the unpaid principal balances by delinquency status of Farm & Ranch loans underlying LTSPCs. Farm & Ranch Farmer Mac Guaranteed Securities, Rural Utilities loans underlying LTSPCs, and non-performing assets as of June 30, 2020: Table 6.7
(1)Includes loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days of more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. (2)Includes $109.5 million of unpaid principal balance related to Farm & Ranch LTSPCs for which the lender has notified Farmer Mac of an executed COVID-19 payment deferment. Table 6.9
(1)Includes loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.
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Schedule of Allowance for Losses by Impairment Method and Commodity | The following tables present the unpaid principal balances of loans held and the related total allowance for losses by impairment method and commodity type as of December 31, 2019: Table 5.5
The following tables present the unpaid principal balances of Farm & Ranch loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities (excluding AgVantage securities) and the related reserve for losses by impairment method and commodity type as of December 31, 2019: Table 6.8
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Schedule of 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 December 31, 2019: Table 5.6
(1)Impairment analysis was performed in the aggregate in consideration of similar risk characteristics of the assets and historical statistics on $159.1 million (70%) of impaired loans as of December 31, 2019, which resulted in a specific allowance of $3.0 million. (2)Includes $30.1 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 and six months ended June 30, 2019: Table 5.7
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Schedule of Financing Receivable Credit Quality Indicators | The following tables present credit quality indicators related to Farm & Ranch loans and Rural Utilities loans held as of June 30, 2020, by year of origination: Table 5.9
(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.
(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. The following table presents credit quality indicators related to Farm & Ranch loans held as of December 31, 2019: Table 5.10
(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. The following tables present credit quality indicators related to Farm & Ranch loans underlying LTSPCs, Farm & Ranch Farmer Mac Guaranteed Securities, and Rural Utilities loans underlying LTSPCs as of June 30, 2020, by year of origination: Table 6.10
(1)Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured. (2)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.
(1)Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured. (2)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. The following table presents credit quality indicators related to Farm & Ranch loans underlying LTSPCs and off-balance sheet Farm & Ranch Farmer Mac Guaranteed Securities as of December 31, 2019: Table 6.11
(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.
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Guarantees (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Guarantor Obligations | The following table presents the maximum principal amount of potential undiscounted future payments that Farmer Mac could be required to make under all off-balance sheet Farmer Mac Guaranteed Securities as of June 30, 2020 and December 31, 2019, not including offsets provided by any recourse provisions, recoveries from third parties, or collateral for the underlying loans: Table 6.1
Table 6.3
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Schedule of Cash Flows Related To Transfer of Securitizations | The following table summarizes the significant cash flows received from and paid to trusts used for Farmer Mac securitizations: Table 6.2
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Schedule of Long-Term Standby Purchase Commitments | The following table presents the liability, the maximum principal amount of potential undiscounted future payments that Farmer Mac could be requested to make under all LTSPCs, not including offsets provided by any recourse provisions, recoveries from third parties, or collateral for the underlying loans, as well as the weighted-average remaining maturity of all loans underlying LTSPCs: Table 6.4
(1) Relates to LTSPCs issued or modified on or after January 1, 2003.
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Schedule of Reserve for Losses | The following table is a summary, by asset type, of the reserve for losses as of June 30, 2020 and December 31, 2019: Table 6.5
(1)Reserve for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained a reserve for losses to cover estimated probable incurred losses on loans underlying LTSPCs and off-balance sheet Farm & Ranch Farmer Mac Guaranteed Securities. The following is a summary of the changes in the reserve for losses for the three and six month period ended June 30, 2020 and 2019: Table 6.6
(1)Reserve for losses reflects the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020. (2)Prior to the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," in first quarter 2020, Farmer Mac maintained a reserve for losses to cover estimated probable incurred losses on loans underlying LTSPCs and off-balance sheet Farm & Ranch Farmer Mac Guaranteed Securities.
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Schedule of Past Due Financing Receivables | The following table presents the unpaid principal balances by delinquency status of Farmer Mac's loans and non-performing assets as of June 30, 2020: Table 5.4
(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)Includes loans in consolidated trusts with beneficial interests owned by third parties that are 90 days or more past due. (3)Includes loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. (4)Includes $23.1 million of nonaccrual loans for which there was no associated allowance. During the three and six months ended June 30, 2020, Farmer Mac received $1.3 million and 2.3 million, respectively, in interest on nonaccrual loans. (5)Includes $82.2 million of unpaid principal balance related to Farm & Ranch loans that Farmer Mac has executed a COVID-19 payment deferment. Net credit losses and 90-day delinquencies as of and for the periods indicated for loans held are presented in the table below. As of December 31, 2019, 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
(1)Includes loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. The following table presents the unpaid principal balances by delinquency status of Farm & Ranch loans underlying LTSPCs. Farm & Ranch Farmer Mac Guaranteed Securities, Rural Utilities loans underlying LTSPCs, and non-performing assets as of June 30, 2020: Table 6.7
(1)Includes loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days of more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan. (2)Includes $109.5 million of unpaid principal balance related to Farm & Ranch LTSPCs for which the lender has notified Farmer Mac of an executed COVID-19 payment deferment. Table 6.9
(1)Includes loans underlying off-balance sheet Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.
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Schedule of Allowance for Losses by Impairment Method and Commodity | The following tables present the unpaid principal balances of loans held and the related total allowance for losses by impairment method and commodity type as of December 31, 2019: Table 5.5
The following tables present the unpaid principal balances of Farm & Ranch loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities (excluding AgVantage securities) and the related reserve for losses by impairment method and commodity type as of December 31, 2019: Table 6.8
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Schedule of Financing Receivable Credit Quality Indicators | The following tables present credit quality indicators related to Farm & Ranch loans and Rural Utilities loans held as of June 30, 2020, by year of origination: Table 5.9
(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.
(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. The following table presents credit quality indicators related to Farm & Ranch loans held as of December 31, 2019: Table 5.10
(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. The following tables present credit quality indicators related to Farm & Ranch loans underlying LTSPCs, Farm & Ranch Farmer Mac Guaranteed Securities, and Rural Utilities loans underlying LTSPCs as of June 30, 2020, by year of origination: Table 6.10
(1)Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured. (2)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.
(1)Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured. (2)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. The following table presents credit quality indicators related to Farm & Ranch loans underlying LTSPCs and off-balance sheet Farm & Ranch Farmer Mac Guaranteed Securities as of December 31, 2019: Table 6.11
(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.
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Notes Payable (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | The following tables set forth information related to Farmer Mac's borrowings as of June 30, 2020 and December 31, 2019: Table 7.1
Table 7.2
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Schedule of Long-Term Debt Instruments | The following schedule summarizes the earliest interest rate reset date, or debt maturities, of total borrowings outstanding as of June 30, 2020, including callable and non-callable medium-term notes, assuming callable notes are redeemed at the initial call date: Table 7.3
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Fair Value Disclosures (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements, Recurring and Nonrecurring | The following tables present information about Farmer Mac's assets and liabilities measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, respectively, and indicate the fair value hierarchy of the valuation techniques used by Farmer Mac to determine such fair value: Table 9.1
(1) Level 3 assets represent 33% of total assets and 69% of financial instruments measured at fair value.
(1) Level 3 assets represent 33% of total assets and 71% of financial instruments measured at fair value.
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Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables present additional information about assets and liabilities measured at fair value on a recurring basis for which Farmer Mac has used significant unobservable inputs to determine fair value. Net transfers in and/or out of Level 3 are based on the fair values of the assets and liabilities as of the beginning of the reporting period. There were no liabilities measured at fair value using significant unobservable inputs during the three and six months ended June 30, 2020 and 2019. Table 9.2
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Fair Value Inputs, Assets and Liabilities, Quantitative Information | The following tables present additional information about the significant unobservable inputs, such as discount rates and constant prepayment rates ("CPR"), used in the fair value measurements categorized in Level 3 of the fair value hierarchy as of June 30, 2020 and December 31, 2019: Table 9.3
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Fair Value, by Balance Sheet Grouping | The following table sets forth the estimated fair values and carrying values for financial assets, liabilities, and guarantees and commitments as of June 30, 2020 and December 31, 2019: Table 9.4
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Business Segment Reporting (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The following tables present core earnings for Farmer Mac's operating segments and a reconciliation to consolidated net income for the three and six months ended June 30, 2020 and 2019: Table 10.1
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
(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)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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.
|
Summary of Significant Accounting Policies - Narrative (Details) |
Jun. 30, 2020
subsidiary
|
---|---|
Accounting Policies [Abstract] | |
Number of subsidiaries | 2 |
Investment Securities - Narrative (Details) |
Jun. 30, 2020 |
---|---|
Debt Securities | |
Debt Securities, Available-for-sale [Line Items] | |
Average percent of amortized cost for securities in unrealized loss positions for more than 12 months | 98.90% |
Investment Securities - Debt Maturities (Details) - Debt Securities - USD ($) $ in Thousands |
Jun. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Amortized Cost | ||
Due within one year | $ 1,235,047 | |
Due after one year through five years | 364,971 | |
Due after five years through ten years | 922,322 | |
Due after ten years | 936,617 | |
Amortized Cost | 3,458,957 | $ 2,961,430 |
Fair Value | ||
Due within one year | 1,241,040 | |
Due after one year through five years | 364,927 | |
Due after five years through ten years | 926,675 | |
Due after ten years | 934,736 | |
Total | $ 3,467,378 | $ 2,959,843 |
Weighted- Average Yield | ||
Due within one year | 1.58% | |
Due after one year through five years | 0.99% | |
Due after five years through ten years | 0.72% | |
Due after ten years | 0.69% | |
Total | 1.05% |
Farmer Mac Guaranteed Securities and USDA Securities - Narrative (Details) $ in Millions |
Jun. 30, 2020
security
|
Dec. 31, 2019
USD ($)
security
|
---|---|---|
Institutional Credit | Farmer Mac Guaranteed Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions | 13 | 17 |
Held-to-maturity, securities in unrealized loss positions | 0 | 4 |
Number of securities in loss position | 6 | 13 |
USDA Guarantees | USDA Securities: | Payment Deferral, CARES Act | Loans Insured or Guaranteed by US Government Authorities, CARES Act | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid principal balances | $ | $ 50.1 |
Farmer Mac Guaranteed Securities and USDA Securities - Schedule of Available-for-sale Securities (Details) - Farmer Mac Guaranteed Securities $ in Thousands |
Jun. 30, 2020
USD ($)
|
---|---|
Amortized Cost | |
Due within one year | $ 1,435,445 |
Due after one year through five years | 3,434,770 |
Due after five years through ten years | 1,147,366 |
Due after ten years | 1,522,363 |
Amortized Cost | 7,539,944 |
Fair Value | |
Due within one year | 1,438,585 |
Due after one year through five years | 3,557,439 |
Due after five years through ten years | 1,232,206 |
Due after ten years | 1,670,157 |
Total | $ 7,898,387 |
Weighted- Average Yield | |
Due within one year | 1.34% |
Due after one year through five years | 2.34% |
Due after five years through ten years | 2.34% |
Due after ten years | 2.67% |
Total | 2.22% |
Farmer Mac Guaranteed Securities and USDA Securities - Schedule of Held-to-maturity Securities (Details) - Farmer Mac Guaranteed Securities and USDA Securities - USD ($) $ in Thousands |
Jun. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Amortized Cost | ||
Due within one year | $ 445,889 | |
Due after one year through five years | 751,402 | |
Due after five years through ten years | 213,460 | |
Due after ten years | 2,070,436 | |
Amortized Cost | 3,481,187 | $ 3,679,611 |
Fair Value | ||
Due within one year | 451,452 | |
Due after one year through five years | 777,980 | |
Due after five years through ten years | 220,404 | |
Due after ten years | 2,147,089 | |
Total | $ 3,596,925 | $ 3,749,184 |
Weighted- Average Yield | ||
Due within one year | 2.94% | |
Due after one year through five years | 3.21% | |
Due after five years through ten years | 3.17% | |
Due after ten years | 3.39% | |
Total | 3.28% |
Financial Derivatives - Hedged Items in Fair Value Hedging Relationships (Details) - USD ($) $ in Thousands |
Jun. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Loans | ||
HedgedItemsinFairValueHedgingRelationship [Line Items] | ||
Carrying Amount of Hedged Assets/(Liabilities) | $ 1,634,784 | $ 1,050,335 |
Hedged Asset | 186,352 | 37,907 |
Long-term Debt | ||
HedgedItemsinFairValueHedgingRelationship [Line Items] | ||
Carrying Amount of Hedged Assets/(Liabilities) | (2,787,699) | (2,761,052) |
Hedged Liability | (70,433) | (7,433) |
Prepaid Expenses and Other Assets | ||
HedgedItemsinFairValueHedgingRelationship [Line Items] | ||
Carrying Amount of Hedged Assets/(Liabilities) | 400 | |
Farmer Mac Guaranteed Securities | ||
HedgedItemsinFairValueHedgingRelationship [Line Items] | ||
Carrying Amount of Hedged Assets/(Liabilities) | 4,506,185 | 4,092,611 |
Hedged Asset | $ 479,632 | $ 180,215 |
Financial Derivatives - Schedule of Credit Exposure to Interest Rate Swap Counterparties (Details) - USD ($) $ in Thousands |
Jun. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Derivative [Line Items] | ||
Liabilities derivatives interest rate swaps | $ 47,543 | $ 27,042 |
Gross Amount Recognized | Including Accrued Interest | ||
Derivative [Line Items] | ||
Assets derivatives interest rate swaps | 122,793 | 56,139 |
Liabilities derivatives interest rate swaps | 799,070 | 305,584 |
Counterparty Netting | Including Accrued Interest | ||
Derivative [Line Items] | ||
Assets derivatives interest rate swaps | 121,310 | 53,771 |
Liabilities derivatives interest rate swaps | 779,807 | 291,326 |
Net Amount Presented in the Consolidated Balance Sheet | Including Accrued Interest | ||
Derivative [Line Items] | ||
Assets derivatives interest rate swaps | 1,483 | 2,368 |
Liabilities derivatives interest rate swaps | $ 19,263 | $ 14,258 |
Loans - Schedule of Past Due Financing Receivables (Details) - USD ($) |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2020 |
Dec. 31, 2019 |
|
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
90-Days Delinquencies | $ 23,420,000 | ||
Loans subject to removal-of-account provisions | $ 0 | ||
On-Balance Sheet: | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
90-Days Delinquencies | $ 57,719,000 | ||
Net Credit Losses | $ 131,000 |
Guarantees - Off-Balance Sheet Guaranteed Securities (Details) - Variable Interest Entity, Not Primary Beneficiary - USD ($) $ in Thousands |
Jun. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Guarantor Obligations [Line Items] | ||
Total off-balance sheet Farmer Mac Guaranteed Securities | $ 426,602 | $ 504,105 |
Farm & Ranch | ||
Guarantor Obligations [Line Items] | ||
Total off-balance sheet Farmer Mac Guaranteed Securities | 90,225 | 107,322 |
USDA Guarantees | ||
Guarantor Obligations [Line Items] | ||
Total off-balance sheet Farmer Mac Guaranteed Securities | 330,309 | 389,216 |
Institutional Credit | ||
Guarantor Obligations [Line Items] | ||
Total off-balance sheet Farmer Mac Guaranteed Securities | $ 6,068 | $ 7,567 |
Guarantees - Significant Cash Flows Received From and Paid to Trusts (Details) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2020 |
Jun. 30, 2019 |
|
Commitments and Contingencies Disclosure [Abstract] | ||
Proceeds from sale of Farmer Mac Guaranteed Securities | $ 28,050 | $ 166,351 |
Guarantee fees received | $ 894 | $ 861 |
Guarantees - Schedule of Underlying Off-Balance Sheet Guaranteed Securities (Details) - Farmer Mac Guaranteed Securities - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2020 |
Dec. 31, 2019 |
|
Guarantor Obligations [Line Items] | ||
Guarantee and commitment obligation | $ 1,890 | $ 2,230 |
Weighted-average remaining maturity | 9 years 7 months 6 days | 9 years 9 months 18 days |
Institutional Credit | ||
Guarantor Obligations [Line Items] | ||
Weighted-average remaining maturity | 4 years 6 months | 5 years |
Guarantees - Schedule of Long-Term Standby Purchase Commitments (Details) - LTSPCs - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2020 |
Dec. 31, 2019 |
|
Guarantor Obligations [Line Items] | ||
Maximum principal amount | $ 2,900,166 | $ 3,002,349 |
Weighted-average remaining maturity | 15 years 2 months 12 days | 15 years 2 months 12 days |
Guarantee obligations issued after January 1, 2003 | ||
Guarantor Obligations [Line Items] | ||
Guarantee and commitment obligation | $ 33,273 | $ 34,470 |
Guarantees - Reserve For Losses (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2020 |
Jun. 30, 2019 |
Jun. 30, 2020 |
Jun. 30, 2019 |
Mar. 31, 2020 |
Jan. 01, 2020 |
Dec. 31, 2019 |
Mar. 31, 2019 |
Jan. 01, 2019 |
Dec. 31, 2018 |
|
Guarantor Obligations [Line Items] | ||||||||||
Reserve for losses | $ 3,020 | $ 3,020 | $ 2,164 | |||||||
Release of losses | (400) | $ (158) | (7) | $ (287) | ||||||
Farm & Ranch | ||||||||||
Guarantor Obligations [Line Items] | ||||||||||
Reserve for losses | 1,650 | 1,880 | 1,650 | 1,880 | $ 2,020 | $ 2,016 | 2,164 | $ 2,038 | $ 2,167 | $ 2,167 |
Release of losses | (370) | (158) | (366) | (287) | ||||||
Charge-offs | 394 | 394 | ||||||||
Rural Utilities | ||||||||||
Guarantor Obligations [Line Items] | ||||||||||
Reserve for losses | 1,370 | 0 | 1,370 | 0 | $ 1,400 | $ 1,011 | 0 | $ 0 | $ 0 | $ 0 |
Release of losses | (30) | $ 0 | 359 | $ 0 | ||||||
Charge-offs | 0 | 0 | ||||||||
LTSPCs and Farmer Mac Guaranteed Securities | Farm & Ranch | ||||||||||
Guarantor Obligations [Line Items] | ||||||||||
Reserve for losses | 1,650 | 1,650 | 2,164 | |||||||
Charge-offs | 0 | 0 | ||||||||
LTSPCs | Rural Utilities | ||||||||||
Guarantor Obligations [Line Items] | ||||||||||
Reserve for losses | $ 1,370 | $ 1,370 | $ 0 |
Guarantees - Schedule of Past Due Financing Receivables (Details) - USD ($) $ in Thousands |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2020 |
Dec. 31, 2019 |
|
Guarantor Obligations [Line Items] | |||
90-Days Delinquencies | $ 23,420 | ||
Off-Balance Sheet: | |||
Guarantor Obligations [Line Items] | |||
90-Days Delinquencies | $ 3,235 | ||
Net credit losses (recoveries) | $ 0 |
Notes Payable (Details) - USD ($) |
6 Months Ended | |
---|---|---|
Jun. 30, 2020 |
Jun. 30, 2019 |
|
Debt Instrument [Line Items] | ||
Medium term notes called during the period | $ 1,900,000,000 | $ 300,000,000 |
Maximum borrowing capacity from U.S. Treasury | 1,500,000,000 | |
Outstanding debt repurchases | $ 0 | 0 |
Discount Notes | ||
Debt Instrument [Line Items] | ||
Maturities of notes | 1 year | |
Medium-term Notes | Minimum | ||
Debt Instrument [Line Items] | ||
Maturities of notes | 6 months | |
Medium-term Notes | Maximum | ||
Debt Instrument [Line Items] | ||
Maturities of notes | 15 years | |
Notes Payable to Banks | ||
Debt Instrument [Line Items] | ||
Maximum amount of discount notes outstanding at any month end | $ 2,600,000,000 | $ 2,100,000,000 |
Notes Payable - Callable Medium-Term Notes (Details) - USD ($) $ in Thousands |
Jun. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Debt Instrument [Line Items] | ||
2022 | $ 3,764,817 | $ 3,700,835 |
2023 | 1,839,291 | 1,594,709 |
2024 | 1,204,584 | 1,205,276 |
Total | $ 21,421,550 | $ 19,098,648 |
Weighted - Average Rate (as a percent) | 1.61% | 2.28% |
Call Option | ||
Debt Instrument [Line Items] | ||
2021 | $ 491,862 | |
2022 | 203,845 | |
2023 | 37,953 | |
2024 | 143,832 | |
Thereafter | 399,489 | |
Total | $ 1,276,981 | |
Weighted - Average Rate (as a percent) | 1.56% | |
Call Option | 2021 | ||
Debt Instrument [Line Items] | ||
Weighted - Average Rate (as a percent) | 1.02% | |
Call Option | 2022 | ||
Debt Instrument [Line Items] | ||
Weighted - Average Rate (as a percent) | 1.43% | |
Call Option | 2023 | ||
Debt Instrument [Line Items] | ||
Weighted - Average Rate (as a percent) | 0.82% | |
Call Option | 2024 | ||
Debt Instrument [Line Items] | ||
Weighted - Average Rate (as a percent) | 1.80% | |
Call Option | Thereafter | ||
Debt Instrument [Line Items] | ||
Weighted - Average Rate (as a percent) | 2.25% |
Equity (Details) - USD ($) $ / shares in Units, shares in Thousands |
1 Months Ended | 3 Months Ended | 57 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|---|
May 31, 2020 |
Jun. 30, 2020 |
Mar. 31, 2020 |
Dec. 31, 2019 |
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Jun. 30, 2020 |
Mar. 14, 2019 |
Dec. 31, 2015 |
|
Class of Stock [Line Items] | ||||||||||
Quarterly dividend on all classes of common stock (in dollars per share) | $ 0.80 | $ 0.80 | $ 0.70 | $ 0.70 | $ 0.70 | $ 0.70 | ||||
Capital required for capital adequacy | $ 667,700,000 | $ 618,800,000 | $ 667,700,000 | |||||||
Capital | 915,600,000 | 815,400,000 | 915,600,000 | |||||||
Excess capital | $ 247,900,000 | $ 196,600,000 | $ 247,900,000 | |||||||
Series E Preferred Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Number of shares issued (in shares) | 3,200 | |||||||||
Preferred stock, dividend rate (as a percent) | 5.75% | |||||||||
Preferred stock, par value (in dollars per share) | $ 25.00 | $ 25 | $ 25 | $ 25 | ||||||
Payments of stock issuance costs | $ 2,500,000 | |||||||||
Class C non-voting common stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Stock authorized for repurchase | $ 10,000,000.0 | $ 25,000,000.0 | ||||||||
Shares repurchased (in shares) | 4 | 673 | ||||||||
Shares repurchased | $ 200,000 | $ 19,800,000 |
Fair Value Disclosures - Narrative (Details) - Level 3 |
Jun. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Percent of level three fair value assets and liabilities | 33.00% | 33.00% |
Financial instruments level three percent | 69.00% | 71.00% |
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