Outstanding Business Volume Exceeds $30 Billion –
The Federal Agricultural Mortgage Corporation (Farmer Mac; NYSE: AGM and AGM.A), the nation's secondary market provider that increases the accessibility of financing to provide vital liquidity for American agriculture and rural infrastructure, today announced its results for the fiscal quarter ended June30, 2025.
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“I'm very pleased to report that we delivered record results across the board in second quarter 2025, growing core earnings and net effective spread by 19% and 12% year-over-year, respectively, and surpassing $30 billion in total outstanding business volume for the first time,” said Brad Nordholm, President and Chief Executive Officer. “Our total portfolio is well diversified by both commodity and geography, and we remain confident in the overall health of our business. We are excited about the strategic direction of the company and remain focused on our mission to provide capital through agricultural and economic cycles.”
Second Quarter 2025
— Provided $2.1 billion in liquidity and lending capacity to lenders serving rural America
— Net interest income grew 11% year-over-year to $96.8 million
— Net effective spread1 increased 12% from the prior-year period to a record $93.9 million
— Net income attributable to common stockholders increased 22% from the prior-year period to $49.2 million
— Record core earnings1 of $47.4 million, or $4.32 per diluted common share, reflecting 19% growth year-over-year
— Maintained strong capital position with total core capital of $1.6 billion, exceeding the statutory requirement by 63% and a Tier 1 Capital Ratio of 13.6% as of June 30, 2025
— As of June 30, 2025, Farmer Mac had 310 days of liquidity
— Authorization for our existing share repurchase program was increased to $50.0 million of outstanding Class C non-voting common stock and extended through August 2027
$ in thousands, except per share amounts Quarter Ended June 30, 2025 March 31, 2025 June 30, 2024 Sequential % YoY % Change ChangeNet Change in $831,916 $232,313 $(88,891) N/A N/ABusiness VolumeNet Interest Income (GAAP) $96,797 $90,939 $87,340 6% 11%Net Effective Spread $93,893 $89,990 $83,596 4% 12%(Non-GAAP)Diluted EPS (GAAP) $4.48 $4.01 $3.68 12% 22%Core EPS (Non-GAAP) $4.32 $4.19 $3.63 3% 19%
Earnings Conference Call Information
The conference call to discuss Farmer Mac's second quarter 2025 financial results will be held beginning at 4:30 p.m. eastern time on Thursday, August7, 2025, and can be accessed by telephone or live webcast as follows:
Telephone (Domestic): (800) 836-8184 Telephone (International): (646) 357-8785 Webcast: https://www.farmermac.com/investors/events-presentations/
When dialing in to the call, please ask for the “Farmer Mac Earnings Conference Call.” The call can be heard live and will also be available for replay on Farmer Mac's website for one week following the conclusion of the call.
More complete information about Farmer Mac's performance for second quarter 2025 is in Farmer Mac'sQuarterly Report on Form 10-Q for the quarter ended June30, 2025, filed today with the SEC.
Use of Non-GAAP Measures
In the accompanying analysis of its financial information, Farmer Mac uses “non-GAAP measures,” which are measures of financial performance that are not presented in accordance with GAAP. Specifically, Farmer Mac uses the following non-GAAP measures: “core earnings,” “core earnings per common share,” and “net effective spread.” Farmer Mac uses these non-GAAP measures to measure corporate economic performance and develop financial plans because, in management's view, they are useful alternative measures in understanding FarmerMac's economic performance, transaction economics, and business trends. The non-GAAP financial measures that Farmer Mac uses may not be comparable to similarly labeled non-GAAP financial measures disclosed by other companies. Farmer Mac's disclosure of these non-GAAP measures is intended to be supplemental in nature and is not meant to be considered in isolation from, as a substitute for, or as more important than, the related financial information prepared in accordance with GAAP.
Core Earnings and Core Earnings Per Share
The main difference between core earnings and core earnings per common share (“Core EPS”), which are non-GAAP measures, and net income attributable to common stockholders and earnings per common share (“EPS”), which are GAAP measures, is that those non-GAAP measures exclude the effects of fair value fluctuations. These fluctuations are not expected to have a cumulative net impact on Farmer Mac's financial condition or results of operations reported in accordance with GAAP if the related financial instruments are held to maturity, as is expected. Another difference is that these two non-GAAP measures exclude specified infrequent or unusual transactions that we believe are not indicative of future operating results and that may not reflect the trends and economic financial performance of Farmer Mac's core business. For example, in third quarter 2024, we excluded the loss on the retirement of the Series C Preferred Stock from core earnings and Core EPS, which is consistent with Farmer Mac's historical treatment of any losses on the retirement of preferred stock.
Net Effective Spread
Farmer Mac uses net effective spread to measure the net spread Farmer Mac earns between its interest-earning assets and the related net funding costs of those assets. As further explained below, net effective spread differs from net interest income by excluding certain items from net interest income and including certain other items that net interest income does not contain.
Net effective spread excludes the interest income and interest expense associated with consolidated trusts with beneficial interests owned by third parties (single-class) and the average balance of the loans underlying these trusts to reflect management's view that the net interest income earned on the related Farmer Mac Guaranteed Securities owned by third parties is effectively a guarantee fee. Accordingly, the excluded interest income and interest expense associated with consolidated trusts is reclassified to guarantee and commitment fees in determining Farmer Mac's core earnings. Net effective spread also excludes the fair value changes of financial derivatives and the corresponding average balances of assets or liabilities designated in fair value hedge accounting relationships because they are not expected to have an economic effect on Farmer Mac's financial performance, as we expect to hold the financial derivatives and corresponding hedged items to maturity.
Farmer Mac uses net effective spread to show the complete net spread between its interest-earning assets and all related net funding costs, including any associated derivatives, whether or not they are designated in a hedge accounting relationship. Accordingly, the net effective spread includes the accrual of income and expense related to the contractual amounts due on financial derivatives that are not designated in hedge accounting relationships (“undesignated financial derivatives”). For undesignated financial derivatives, Farmer Mac records the income or expense related to the accrual of the contractual amounts due in “Gains/(losses) on financial derivatives” on the consolidated statements of operations.
Net effective spread also differs from net interest income because it includes the net effects of terminations or net settlements on undesignated financial derivatives, which consist of: (1) the net effects of cash settlements on agency forward contracts on the debt of other GSEs and U.S. Treasury security futures that we use as short-term economic hedges on the issuance of debt; and (2) the net effects of initial cash payments that Farmer Mac receives upon the inception of certain swaps.
More information about Farmer Mac's use of non-GAAP measures is available in “Management's Discussion and Analysis of Financial Condition and Results of Operations-Results of Operations” in Farmer Mac's Annual Report on Form 10-K for the year ended December31, 2024, filed February 21, 2025 with the SEC. For a reconciliation of Farmer Mac's net income attributable to common stockholders to core earnings and of earnings per common share to core earnings per share, and net interest income and net interest yield to net effective spread, see “Reconciliations” below.
Forward-Looking Statements
Management's expectations for Farmer Mac's future necessarily involve assumptions, estimates, and the evaluation of risks and uncertainties. Various factors or events, both known and unknown, could cause Farmer Mac's actual results to differ materially from the expectations as expressed or implied by the forward-looking statements in this release, including uncertainties about:
— the availability to Farmer Mac of debt and equity financing and, if available, the reasonableness of rates and terms;
— legislative, regulatory, or political developments that could affect Farmer Mac, its sources of business, or agricultural or infrastructure industries;
— fluctuations in the fair value of assets held by Farmer Mac and its subsidiaries;
— the level of lender interest in Farmer Mac's products and the secondary market provided by Farmer Mac;
— the general rate of growth in agricultural mortgage and infrastructure indebtedness;
— the effect of economic conditions stemming from disruptive global events or otherwise on agricultural mortgage or infrastructure lending, borrower repayment capacity, or collateral values, including inflation, fluctuations in interest rates, changes in U.S. trade policies (including tariffs and trade restrictions), fluctuations in export demand for U.S. agricultural products and foreign currency exchange rates, supply chain disruptions, increases in input costs, labor availability, and volatility in commodity prices;
— the degree to which Farmer Mac is exposed to interest rate risk resulting from fluctuations in Farmer Mac's borrowing costs relative to market indexes;
— developments in the financial markets, including possible investor, analyst, and rating agency reactions to events involving government-sponsored enterprises, including Farmer Mac;
— the effects of the Federal Reserve's efforts to achieve monetary policy normalization to respond to inflation and employment levels; and
— other factors that could hinder agricultural mortgage lending or borrower repayment capacity, including the effects of severe weather, flooding and drought, or fluctuations in agricultural real estate values.
Other risk factors are discussed in “Risk Factors” in Part I, Item 1A in Farmer Mac's Annual Report on Form 10-K for the year ended December31, 2024, filed with the SEC on February 21, 2025. Considering these potential risks and uncertainties, no undue reliance should be placed on any forward-looking statements expressed in this release. The forward-looking statements contained in this release represent management's expectations as of the date of this release. Farmer Mac undertakes no obligation to release publicly the results of revisions to any forward-looking statements included in this release to reflect new information or any future events or circumstances, except as otherwise required by applicable law. The information in this release is not necessarily indicative of future results.
About Farmer Mac
Farmer Mac is driven by its mission to increase the accessibility of financing to provide vitalliquidity for American agriculture and rural infrastructure. Our secondary market provides liquidityto our nation's agricultural and infrastructure businesses, supporting a vibrant and strong ruralAmerica. We offer a wide range of solutions to help meet financial institutions' growth, liquidity,risk management, and capital relief needs across diverse markets, including agriculture,agribusiness, broadband infrastructure, power and utilities, and renewable energy. We areuniquely positioned to facilitate competitive access to financing that fuels growth, innovation, andprosperity in America's rural and agricultural communities. Additional information about FarmerMac is available on our website at www.farmermac.com.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS(unaudited) As of June 30, 2025 December 31, 2024 (in thousands)Assets:Cash and cash equivalents (includes restricted cash of $12,839 and $16,190, respectively) $ 1,030,329 $ 1,024,007Investment securities:Available-for-sale, at fair value (amortized cost of $6,756,185 and $6,105,116, respectively) 6,674,031 5,953,014Held-to-maturity, at amortized cost 8,970 9,270Other investments 14,257 11,017Total Investment Securities 6,697,258 5,973,301Farmer Mac Guaranteed Securities:Available-for-sale, at fair value (amortized cost of $5,942,469 and $5,835,658, respectively) 5,731,503 5,514,546Held-to-maturity, at amortized cost 2,130,995 2,717,688Total Farmer Mac Guaranteed Securities 7,862,498 8,232,234USDA Securities:Trading, at fair value 560 818Held-to-maturity, at amortized cost 2,406,638 2,370,534Total USDA Securities 2,407,198 2,371,352Loans:Loans held for sale, at lower of cost or fair value 7,770 6,170Loans held for investment, at amortized cost 12,226,915 11,183,408Loans held for investment in consolidated trusts, at amortized cost 2,275,254 2,038,283Allowance for losses (29,956) (23,223)Total loans, net of allowance 14,479,983 13,204,638Financial derivatives, at fair value 30,650 27,789Accrued interest receivable (includes $31,789 and $28,563, respectively, related to consolidated trusts) 313,387 310,592Guarantee and commitment fees receivable 49,706 50,499Deferred tax asset, net 3,707 1,544Prepaid expenses and other assets 121,193 128,786Total Assets $ 32,995,909 $ 31,324,742Liabilities and Equity:Liabilities:Notes payable $ 28,843,331 $ 27,371,174Debt securities of consolidated trusts held by third parties 2,157,962 1,929,628Financial derivatives, at fair value 53,697 77,326Accrued interest payable (includes $12,789 and $12,387, respectively, related to consolidated trusts) 210,610 195,113Guarantee and commitment obligation 47,476 48,326Accounts payable and accrued expenses 136,906 212,527Reserve for losses 1,620 1,622Total Liabilities 31,451,602 29,835,716Commitments and ContingenciesEquity:Preferred stock:Series D, par value $25 per share, 4,000,000 shares authorized, issued and outstanding 96,659 96,659Series E, par value $25 per share, 3,180,000 shares authorized, issued and outstanding 77,003 77,003Series F, par value $25 per share, 4,800,000 shares authorized, issued and outstanding 116,160 116,160Series G, par value $25 per share, 5,000,000 shares authorized, issued and outstanding 121,327 121,327Common stock:Class A Voting, $1 par value, no maximum authorization, 1,030,780 shares outstanding 1,031 1,031Class B Voting, $1 par value, no maximum authorization, 500,301 shares outstanding 500 500Class C Non-Voting, $1 par value, no maximum authorization, 9,402,503 shares and 9,360,083 shares outstanding, respectively 9,403 9,360Additional paid-in capital 136,248 135,894Accumulated other comprehensive loss, net of tax (17,665) (12,147)Retained earnings 1,003,641 943,239Total Equity 1,544,307 1,489,026Total Liabilities and Equity $ 32,995,909 $ 31,324,742
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS(unaudited) For the Three Months Ended For the Six Months Ended June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2024 (in thousands, except per share amounts)Interest income:Investments and cash equivalents $ 88,985 $ 84,538 $ 172,293 $ 169,462Farmer Mac Guaranteed Securities and USDA Securities 124,998 166,063 251,340 332,876Loans 185,039 153,105 356,803 297,685Total interest income 399,022 403,706 780,436 800,023Total interest expense 302,225 316,366 592,700 626,315Net interest income 96,797 87,340 187,736 173,708Provision for losses (7,713) (6,179) (9,397) (4,378)Net interest income after provision for losses 89,084 81,161 178,339 169,330Non-interest income/(expense):Guarantee and commitment fees 4,816 3,797 9,295 7,714Gains/(losses) on financial derivatives 80 (1,799) (2,556) 280Losses on sale of mortgage loans – (1,147) – (1,147)Gains on sale of available-for-sale investment securities – 1,052 – 1,052Provision for/(release of) reserve for losses (99) (51) 2 18Other income 1,040 674 2,476 1,923Non-interest income 5,837 2,526 9,217 9,840Operating expenses:Compensation and employee benefits 17,631 14,840 35,383 33,097General and administrative 10,859 8,904 21,617 17,159Regulatory fees 1,000 725 2,000 1,450Operating expenses 29,490 24,469 59,000 51,706Income before income taxes 65,431 59,218 128,556 127,464Income tax expense 10,594 12,113 24,068 26,613Net income 54,837 47,105 104,488 100,851Preferred stock dividends (5,667) (6,792) (11,333) (13,583)Net income attributable to common stockholders $ 49,170 $ 40,313 $ 93,155 $ 87,268Earnings per common share:Basic earnings per common share $ 4.50 $ 3.71 $ 8.53 $ 8.04Diluted earnings per common share $ 4.48 $ 3.68 $ 8.49 $ 7.96
Reconciliations
Reconciliations of Farmer Mac's net income attributable to common stockholders to core earnings and core earnings per share are presented in the following tables along with information about the composition of core earnings for the periods indicated:
Reconciliation of Net Income Attributable to Common Stockholders to Core Earnings For the Three Months Ended June 30, 2025 March 31, 2025 June 30, 2024 (inthousands,exceptpershareamounts)Net income attributable to common stockholders $ 49,170 $ 43,985 $ 40,313Less reconciling items:Losses on undesignated financial derivatives due to fair value changes (639) (2,573) (359)Gains on hedging activities due to fair value changes 2,709 1,099 2,604Unrealized (losses)/gains on trading assets (65) 9 (87)Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value 25 28 26Net effects of terminations or net settlements on financial derivatives 255 (1,070) (1,505)Income tax effect related to reconciling items (480) 526 (143)Sub-total 1,805 (1,981) 536Core earnings $ 47,365 $ 45,966 $ 39,777Composition of Core Earnings:Revenues:Net effective spread(1) $ 93,893 $ 89,990 $ 83,596Guarantee and commitment fees(2) 5,874 5,488 5,256Gain on sale of investment securities (GAAP) – – 1,052Loss on sale of mortgage loan (GAAP) – – (1,147)Other(3) 742 1,315 481Total revenues 100,509 96,793 89,238Credit related expense/(income) (GAAP):Provision for losses 7,812 1,583 6,230REO operating expenses 148 – -(Gain)/loss on sale of REO (87) 68 -Total credit related expense/(income) 7,873 1,651 6,230Operating expenses (GAAP):Compensation and employee benefits 17,631 17,752 14,840General and administrative 10,859 10,758 8,904Regulatory fees 1,000 1,000 725Total operating expenses 29,490 29,510 24,469Net earnings 63,146 65,632 58,539Income tax expense(4) 10,114 14,000 11,970Preferred stock dividends (GAAP) 5,667 5,666 6,792Core earnings $ 47,365 $ 45,966 $ 39,777Core earnings per share:Basic $ 4.33 $ 4.22 $ 3.66Diluted $ 4.32 $ 4.19 $ 3.63
(1) Net effective spread is a non-GAAP measure. See “Use of Non-GAAP Measures” above for an explanation of net effective spread. See below for a reconciliation of net interest income to net effective spread.(2) Includes interest income and interest expense related to consolidated trusts owned by third parties reclassified from net interest income to guarantee and commitment fees to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee on the consolidated Farmer Mac Guaranteed Securities.(3) Reflects reconciling adjustments for the reclassification to exclude expenses related to interest rate swaps not designated as hedges and terminations or net settlements on financial derivatives, and reconciling adjustments to exclude fair value adjustments on financial derivatives and trading assets and the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.(4) Includes the tax impact of non-GAAP reconciling items between net income attributable to common stockholders and core earnings.
Reconciliation of Net Income Attributable to Common Stockholders to Core Earnings For the Six Months Ended June 30, 2025 June 30, 2024 (inthousands,exceptpershareamounts)Net income attributable to common stockholders $ 93,155 $ 87,268Less reconciling items:(Losses)/gains on undesignated financial derivatives due to fair value changes (3,212) 1,324Gains on hedging activities due to fair value changes 3,808 5,606Unrealized losses on trading assets (56) (101)Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value 53 57Net effects of terminations or net settlements on financial derivatives (815) (1,697)Income tax effect related to reconciling items 46 (1,090)Sub-total (176) 4,099Core earnings $ 93,331 $ 83,169Composition of Core Earnings:Revenues:Net effective spread(1) $ 183,883 $ 166,640Guarantee and commitment fees(2) 11,362 10,238Gain on sale of investment securities (GAAP) – 1,052Loss on sale of mortgage loan (GAAP) – (1,147)Other(3) 2,057 1,558Total revenues 197,302 178,341Credit related expense/(income) (GAAP):Provision for losses 9,395 4,360REO operating expenses 148 -Gain on sale of REO (19) -Total credit related expense/(income) 9,524 4,360Operating expenses (GAAP):Compensation and employee benefits 35,383 33,097General and administrative 21,617 17,159Regulatory fees 2,000 1,450Total operating expenses 59,000 51,706Net earnings 128,778 122,275Income tax expense(4) 24,114 25,523Preferred stock dividends (GAAP) 11,333 13,583Core earnings $ 93,331 $ 83,169Core earnings per share:Basic $ 8.55 $ 7.66Diluted $ 8.51 $ 7.59
(1) Net effective spread is a non-GAAP measure. See “Use of Non-GAAP Measures” above for an explanation of net effective spread. See below for a reconciliation of net interest income to net effective spread.(2) Includes interest income and interest expense related to consolidated trusts owned by third parties reclassified from net interest income to guarantee and commitment fees to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee on the consolidated Farmer Mac Guaranteed Securities.(3) Reflects reconciling adjustments for the reclassification to exclude expenses related to interest rate swaps not designated as hedges and terminations or net settlements on financial derivatives, and reconciling adjustments to exclude fair value adjustments on financial derivatives and trading assets and the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.(4) Includes the tax impact of non-GAAP reconciling items between net income attributable to common stockholders and core earnings.
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, 2025 March 31, 2025 June 30, 2024 June 30, 2025 June 30, 2024 (in thousands, except per share amounts)GAAP – Basic EPS $ 4.50 $ 4.04 $ 3.71 $ 8.53 $ 8.04Less reconciling items:(Losses)/gains on undesignated financial derivatives due to fair value changes (0.06) (0.23) (0.03) (0.29) 0.12Gains on hedging activities due to fair value changes 0.25 0.10 0.24 0.35 0.52Unrealized (losses)/gains on trading securities (0.01) – (0.01) (0.01) (0.01)Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value – – – 0.01 0.01Net effects of terminations or net settlements on financial derivatives 0.03 (0.10) (0.14) (0.08) (0.16)Income tax effect related to reconciling items (0.04) 0.05 (0.01) – (0.10)Sub-total 0.17 (0.18) 0.05 (0.02) 0.38Core Earnings – Basic EPS $ 4.33 $ 4.22 $ 3.66 $ 8.55 $ 7.66Shares used in per share calculation (GAAP and Core Earnings) 10,933 10,896 10,879 10,915 10,863Reconciliation 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, 2025 March 31, 2025 June 30, 2024 June 30, 2025 June 30, 2024 (in thousands, except per share amounts)GAAP – Diluted EPS $ 4.48 $ 4.01 $ 3.68 $ 8.49 $ 7.96Less reconciling items:(Losses)/gains on undesignated financial derivatives due to fair value changes (0.06) (0.23) (0.03) (0.29) 0.12Gains on hedging activities due to fair value changes 0.25 0.10 0.24 0.35 0.51Unrealized (losses)/gains on trading securities (0.01) – (0.01) (0.01) (0.01)Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value – – – – 0.01Net effects of terminations or net settlements on financial derivatives 0.02 (0.10) (0.14) (0.07) (0.16)Income tax effect related to reconciling items (0.04) 0.05 (0.01) – (0.10)Sub-total 0.16 (0.18) 0.05 (0.02) 0.37Core Earnings – Diluted EPS $ 4.32 $ 4.19 $ 3.63 $ 8.51 $ 7.59Shares used in per share calculation (GAAP and Core Earnings) 10,963 10,983 10,956 10,973 10,966
The following table presents a reconciliation of net interest income and net yield to net effective spread for the periods indicated:
Reconciliation of GAAP Net Interest Income/Yield to Net Effective Spread For the Three Months Ended For the Six Months Ended June 30, 2025 March 31, 2025 June 30, 2024 June 30, 2025 June 30, 2024 Dollars Yield Dollars Yield Dollars Yield Dollars Yield Dollars Yield (dollars in thousands)Net interest income/yield $ 96,797 1.20% $ 90,939 1.15% $ 87,340 1.15% $ 187,736 1.17% $ 173,708 1.15%Net effects of consolidated trusts (987) 0.02% (1,010) 0.02% (1,371) 0.02% (1,998) 0.02% (2,423) 0.02%Expense related to undesignated financial derivatives (208) -% 318 -% (486) (0.01)% 110 -% (521) -%Amortization of premiums/discounts on assets consolidated at fair value (22) -% (25) -% (21) -% (47) -% (48) -%Amortization of losses due to terminations or net settlements on financial derivatives 1,022 0.01% 867 0.01% 738 0.01% 1,890 0.01% 1,530 0.01%Fair value changes on fair value hedge relationships (2,709) (0.04)% (1,099) (0.01)% (2,604) (0.03)% (3,808) (0.02)% (5,606) (0.04)%Net effective spread $ 93,893 1.19% $ 89,990 1.17% $ 83,596 1.14% $ 183,883 1.18% $ 166,640 1.14%
The following table presents core earnings for Farmer Mac's reportable operating segments and a reconciliation to consolidated net income for the three months ended June30, 2025:
Core Earnings by Business SegmentFor the Three Months Ended June30, 2025 Agricultural Finance Infrastructure Finance Treasury Farm & Ranch Corporate AgFinance Power & Broadband Infrastructure Renewable Energy Funding Investments Total Utilities (in thousands)Interest income $ 152,218 $ 25,484 $ 67,447 $ 12,159 $ 23,494 $ 35,619 $ 82,601 $ 399,022Interest expense(1) (115,524) (16,875) (61,786) (8,227) (17,267) (1,920) (80,626) (302,225)Less: reconciling adjustments(2)(3) (984) – (25) – – (2,031) 136 (2,904)Net effective spread 35,710 8,609 5,636 3,932 6,227 31,668 2,111 93,893Guarantee and commitment fees(3) 4,551 224 215 564 320 – – 5,874Other income/(expense) 313 345 – – 8 – 14 680(Provision for)/release of losses (4,494) (614) (73) (666) (1,964) – (1) (7,812)Operating expenses(1) (7,020) (2,378) (1,156) (1,274) (1,560) (3,003) (888) (17,279)Income tax (expense)/benefit (6,101) (1,300) (970) (537) (637) (6,020) (260) (15,825)Segment core earnings $ 22,959 $ 4,886 $ 3,652 $ 2,019 $ 2,394 $ 22,645 $ 976 $ 59,531Reconciliation to net income:Net effects of derivatives and trading securities $ 2,260Unallocated (expenses)/income (12,185)Income tax effect related to reconciling items 5,231Net income $ 54,837Total Assets:Total on- and off-balance sheet segment assets at principal balance $ 18,217,905 $ 1,953,523 $ 7,300,354 $ 1,174,441 $ 1,941,036 $ – $ – $ 30,587,259Off-balance sheet assets under management (5,257,348)Unallocated assets 7,665,998Total assets on the consolidated balance sheets $ 32,995,909
(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the Chief Operating Decision Maker (“CODM”) .(2) Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; 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; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships.(3) 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.
Supplemental Information
The following table sets forth information about outstanding volume in each of Farmer Mac's lines of business as of the dates indicated:
Outstanding Business Volume On or Off As of June 30, 2025 As of December 31, 2024 Balance Sheet (inthousands)Agricultural Finance:Farm & Ranch:Loans On-balance sheet $ 5,630,602 $ 5,414,732Loans held in consolidated trusts:Beneficial interests owned by third-party investors (single-class)(1) On-balance sheet 877,422 885,295Beneficial interests owned by third-party investors (structured)(1) On-balance sheet 1,397,832 1,152,988IO-FMGS(2) On-balance sheet 8,369 8,710USDA Securities On-balance sheet 2,458,647 2,402,423AgVantage Securities(1) On-balance sheet 3,985,000 4,720,000LTSPCs and unfunded loan commitments Off-balance sheet 3,019,531 3,070,554Other Farmer Mac Guaranteed Securities(3) Off-balance sheet 399,168 426,310Loans serviced for others Off-balance sheet 441,334 525,956Total Farm & Ranch $ 18,217,905 $ 18,606,968Corporate AgFinance:Loans On-balance sheet $ 1,450,596 $ 1,381,674AgVantage Securities(1) On-balance sheet 259,938 280,297Unfunded loan commitments Off-balance sheet 242,989 225,734Total Corporate AgFinance $ 1,953,523 $ 1,887,705Total Agricultural Finance $ 20,171,428 $ 20,494,673Infrastructure Finance:Power & Utilities:Loans On-balance sheet $ 3,162,796 $ 2,886,576AgVantage Securities(1) On-balance sheet 3,776,849 3,521,143LTSPCs and unfunded loan commitments Off-balance sheet 360,709 401,647Total Power & Utilities $ 7,300,354 $ 6,809,366Broadband Infrastructure:Loans On-balance sheet $ 748,748 $ 622,207Unfunded loan commitments Off-balance sheet 425,693 180,259Total Broadband Infrastructure $ 1,174,441 $ 802,466Renewable Energy:Loans On-balance sheet $ 1,573,112 $ 1,265,700Unfunded loan commitments Off-balance sheet 367,924 150,825Total Renewable Energy $ 1,941,036 $ 1,416,525Total Infrastructure Finance $ 10,415,831 $ 9,028,357Total $ 30,587,259 $ 29,523,030
(1) A type of Farmer Mac Guaranteed Security.(2) An interest-only Farmer Mac Guaranteed Security retained as part of a structured securitization.(3) Other categories of Farmer Mac Guaranteed Securities that were sold by Farmer Mac to third parties
The following table presents the quarterly net effective spread (a non-GAAP measure) by segment:
Net Effective Spread Agricultural Finance Infrastructure Finance Treasury Farm & Corporate AgFinance Power & Utilities Broadband Infrastructure Renewable Energy Funding Investments Net Effective Spread Ranch Dollars Dollars Dollars Dollars Dollars Dollars Dollars Dollars Yield Yield Yield Yield Yield Yield Yield Yield (dollars in thousands)For the quarter ended:June 30, 2025 $ 35,710 $ 8,609 $ 5,636 $ 3,932 $ 6,227 $ 31,668 $ 2,111 $ 93,893 1.07% 2.07% 0.33% 2.24% 1.68% 0.40% 0.11% 1.19%March 31, 2025 33,885 8,640 5,329 3,566 5,112 31,604 1,854 89,990 1.01% 2.09% 0.32% 2.27% 1.55% 0.41% 0.10% 1.17%December 31, 2024 32,556 7,891 5,059 3,414 4,859 31,242 2,507 87,528 0.96% 1.95% 0.32% 2.34% 1.76% 0.42% 0.15% 1.16%September 30, 2024 35,755 6,397 4,785 2,794 3,810 30,912 943 85,396 1.05% 1.56% 0.30% 2.21% 1.78% 0.42% 0.05% 1.16%June 30, 2024 34,156 7,866 5,253 2,393 2,999 30,268 661 83,596 0.98% 1.91% 0.32% 2.16% 1.86% 0.41% 0.04% 1.14%March 31, 2024 32,843 7,971 4,890 2,342 2,049 32,474 475 83,044 0.95% 2.05% 0.30% 2.08% 1.75% 0.45% 0.03% 1.14%December 31, 2023 33,329 8,382 4,916 2,426 1,540 33,361 597 84,551 0.98% 2.06% 0.31% 2.06% 1.69% 0.47% 0.04% 1.19%September 30, 2023 32,718 8,250 3,979 2,383 1,150 34,412 532 83,424 0.97% 2.05% 0.26% 2.15% 1.46% 0.49% 0.04% 1.20%June 30, 2023 34,388 7,444 3,681 2,127 1,100 32,498 594 81,832 1.03% 1.92% 0.25% 2.25% 1.47% 0.48% 0.04% 1.20%
The following table presents quarterly core earnings reconciled to net income attributable to common stockholders:
Core Earnings by Quarter Ended June 2025 March 2025 December 2024 September 2024 June 2024 March 2024 December 2023 September 2023 June 2023 (in thousands)Revenues:Net effective spread $ 93,893 $ 89,990 $ 87,528 $ 85,396 $ 83,596 $ 83,044 $ 84,551 $ 83,424 $ 81,832Guarantee and commitment fees 5,874 5,488 5,086 4,997 5,256 4,982 4,865 4,828 4,581Gain on sale of investment securities – – – – 1,052 – – – -Loss on sale of mortgage loan – – – – (1,147) – – – -Other 742 1,315 (491) 1,133 481 1,077 767 1,056 409Total revenues 100,509 96,793 92,123 91,526 89,238 89,103 90,183 89,308 86,822Credit related expense/(income):Provision for/(release of) losses 7,812 1,583 3,872 3,258 6,230 (1,870) (575) (181) 1,142REO operating expenses 148 – – 196 – – – – -(Gain)/loss on REO (87) 68 – – – – – – -Total credit related expense/(income) 7,873 1,651 3,872 3,454 6,230 (1,870) (575) (181) 1,142Operating expenses:Compensation and employee benefits 17,631 17,752 15,641 15,237 14,840 18,257 15,523 14,103 13,937General and administrative 10,859 10,758 12,452 8,625 8,904 8,255 8,916 9,100 9,420Regulatory fees 1,000 1,000 1,000 725 725 725 725 831 831Total operating expenses 29,490 29,510 29,093 24,587 24,469 27,237 25,164 24,034 24,188Net earnings 63,146 65,632 59,158 63,485 58,539 63,736 65,594 65,455 61,492Income tax expense 10,114 14,000 9,938 12,681 11,970 13,553 13,881 13,475 12,539Preferred stock dividends 5,667 5,666 5,666 5,897 6,792 6,791 6,791 6,792 6,791Core earnings $ 47,365 $ 45,966 $ 43,554 $ 44,907 $ 39,777 $ 43,392 $ 44,922 $ 45,188 $ 42,162Reconciling items:(Losses)/gains on undesignated financial derivatives due to fair value changes $ (639) $ (2,573) $ 3,084 $ (1,064) $ (359) $ 1,683 $ (836) $ 2,921 $ 2,141Gains/(losses) on hedging activities due to fair value changes 2,709 1,099 5,737 205 2,604 3,002 (3,598) 3,210 (4,901)Unrealized (losses)/gains on trading assets (65) 9 (83) 99 (87) (14) (37) 1,714 (57)Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value 25 28 (39) 27 26 31 88 29 29Net effects of terminations or net settlements on financial derivatives 255 (1,070) 534 (503) (1,505) (192) (800) (79) 583Issuance costs on the retirement of preferred stock – – – (1,619) – – – – -Income tax effect related to reconciling items (480) 526 (1,939) 260 (143) (947) 1,089 (1,638) 464Net income attributable to common stockholders $ 49,170 $ 43,985 $ 50,848 $ 42,312 $ 40,313 $ 46,955 $ 40,828 $ 51,345 $ 40,421
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