Business Segment Reporting (Tables)

12 Months Ended

Dec. 31, 2020

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 years ended December 31, 2020, 2019, and 2018:

Table 14.1

Core Earnings by Business Segment
For the Year Ended December 31, 2020
	Farm & Ranch		USDA Guarantees		Rural  Utilities		Institutional Credit		Corporate		Reconciling Adjustments			Consolidated Net Income
	(in thousands)
Net interest income	$	73,901	$	19,570	$	21,963	$	67,953	$	7,201	$	—		$	190,588
Less: reconciling adjustments(1)(2)(3)	(3,892)		2,395		2,734		4,533		598		(6,368)			—
Net effective spread	70,009		21,965		24,697		72,486		7,799		(6,368)			—
Guarantee and commitment fees(2)	16,957		850		1,314		29		—		(6,601)			12,549
Other income/(expense)(3)	2,556		1,098		32		—		(536)		604			3,754
Non-interest income/(loss)	19,513		1,948		1,346		29		(536)		(5,997)			16,303
Release of losses	(2,959)		—		(4,709)		(110)		(27)		—			(7,805)
Provision for reserve for losses	(81)		—		(169)		—		—		—			(250)
Other non-interest expense	(22,414)		(7,270)		(6,224)		(8,784)		(16,711)		—			(61,403)
Non-interest expense(4)	(22,495)		(7,270)		(6,393)		(8,784)		(16,711)		—			(61,653)
Core earnings before income taxes	64,068		16,643		14,941		63,621		(9,475)		(12,365)		(5)	137,433
Income tax (expense)/benefit	(13,454)		(3,495)		(3,137)		(13,361)		2,066		2,596			(28,785)
Core earnings before preferred stock dividends	50,614		13,148		11,804		50,260		(7,409)		(9,769)		(5)	108,648
Preferred stock dividends	—		—		—		—		(17,805)		—			(17,805)
Loss on retirement of preferred stock	—		—		—		—		—		(1,667)			(1,667)
Segment core earnings/(losses)	$	50,614	$	13,148	$	11,804	$	50,260	$	(25,214)	$	(11,436)	(5)	$	89,176
Total assets at carrying value	$	6,305,975	$	2,553,176	$	2,365,996	$	8,128,489	$	5,001,865	$	—		$	24,355,501
Total on- and off-balance sheet program assets at principal balance	$	8,581,181	$	2,786,718	$	2,816,837	$	7,739,359	$	—	$	—		$	21,924,095

(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 "(Losses)/gains 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.

Core Earnings by Business Segment
For the Year Ended December 31, 2019
	Farm & Ranch		USDA Guarantees		Rural  Utilities		Institutional Credit		Corporate		Reconciling Adjustments			Consolidated Net Income
	(in thousands)
Net interest income	$	65,098	$	17,470	$	10,459	$	69,039	$	11,069	$	—		$	173,135
Less: reconciling adjustments(1)(2)(3)	(9,471)		(732)		6,143		520		(987)		4,527			—
Net effective spread	55,627		16,738		16,602		69,559		10,082		4,527			—
Guarantee and commitment fees(2)	18,593		958		1,412		372		—		(7,669)			13,666
Other income/(expense)(3)	1,397		174		38		—		166		5,501			7,276
Non-interest income/(loss)	19,990		1,132		1,450		372		166		(2,168)			20,942
Provision for loan losses	(3,504)		—		—		—		—		—			(3,504)
Release of reserve for losses	3		—		—		—		—		—			3
Other non-interest expense	(19,375)		(5,757)		(3,898)		(8,390)		(14,505)		—			(51,925)
Non-interest expense(4)	(19,372)		(5,757)		(3,898)		(8,390)		(14,505)		—			(51,922)
Core earnings before income taxes	52,741		12,113		14,154		61,541		(4,257)		2,359		(5)	138,651
Income tax (expense)/benefit	(11,076)		(2,545)		(2,972)		(12,924)		907		(495)			(29,105)
Core earnings before preferred stock dividends	41,665		9,568		11,182		48,617		(3,350)		1,864		(5)	109,546
Preferred stock dividends	—		—		—		—		(13,940)		—			(13,940)
Loss on retirement of preferred stock	—		—		—		—		—		(1,956)			(1,956)
Segment core earnings/(losses)	$	41,665	$	9,568	$	11,182	$	48,617	$	(17,290)	$	(92)	(5)	$	93,650
Total assets at carrying value	$	5,408,302	$	2,311,932	$	1,717,405	$	8,606,912	$	3,664,823	$	—		$	21,709,374
Total on- and off-balance sheet program assets at principal balance	$	7,776,950	$	2,620,175	$	2,280,571	$	8,440,246	$	—	$	—		$	21,117,942

(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 "(Losses)/gains 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.

Core Earnings by Business Segment
For the Year Ended December 31, 2018
	Farm & Ranch		USDA Guarantees		Rural  Utilities		Institutional Credit		Corporate		Reconciling Adjustments			Consolidated Net Income
	(in thousands)
Net interest income	$	62,951	$	20,554	$	12,505	$	69,321	$	9,105	$	—		$	174,436
Less: reconciling adjustments(1)(2)(3)	(9,889)		(2,499)		(922)		(7,884)		(2,047)		23,241			—
Net effective spread	53,062		18,055		11,583		61,437		7,058		23,241			—
Guarantee and commitment fees(2)	17,976		797		1,599		360		—		(6,756)			13,976
Other income/(expense)(3)	1,371		20		33		—		(913)		(2,747)			(2,236)
Non-interest income/(loss)	19,347		817		1,632		360		(913)		(9,503)			11,740
Provision for loan losses	(238)		—		—		—		—		—			(238)
Release of reserve for losses	(97)		—		—		—		—		—			(97)
Other non-interest expense	(19,026)		(5,309)		(3,062)		(8,011)		(14,411)		—			(49,819)
Non-interest expense(4)	(19,123)		(5,309)		(3,062)		(8,011)		(14,411)		—			(49,916)
Core earnings before income taxes	53,048		13,563		10,153		53,786		(8,266)		13,738		(5)	136,022
Income tax (expense)/benefit	(11,140)		(2,848)		(2,133)		(11,295)		2,361		(2,887)			(27,942)
Core earnings before preferred stock dividends	41,908		10,715		8,020		42,491		(5,905)		10,851		(5)	108,080
Preferred stock dividends	—		—		—		—		(13,182)		—			(13,182)
Segment core earnings/(losses)	$	41,908	$	10,715	$	8,020	$	42,491	$	(19,087)	$	10,851	(5)	$	94,898
Total assets at carrying value	$	4,701,736	$	2,240,906	$	945,282	$	8,089,410	$	2,716,994	$	—		$	18,694,328
Total on- and off-balance sheet program assets at principal balance	$	7,233,972	$	2,515,620	$	1,592,115	$	8,382,817	$	—	$	—		$	19,724,524

(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 "(Losses)/gains 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.