FT Markets Data
Federal Agricultural Mortgage Corp

Farmer Mac Reports Second Quarter 2025 Results

- Outstanding Business Volume Exceeds $30 Billion -

WASHINGTON , Aug. 7, 2025 /PRNewswire/ -- 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 June 30, 2025.

"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 %
Change

YoY %
Change

Net Change in

Business Volume

$831,916

$232,313

$(88,891)

N/A

N/A

Net Interest Income (GAAP)

$96,797

$90,939

$87,340

6 %

11 %

Net Effective Spread

(Non-GAAP)

$93,893

$89,990

$83,596

4 %

12 %

Diluted EPS (GAAP)

$4.48

$4.01

$3.68

12 %

22 %

Core EPS (Non-GAAP)

$4.32

$4.19

$3.63

3 %

19 %



1

Non-GAAP Measure

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, August 7, 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's Quarterly Report on Form 10-Q for the quarter ended June 30, 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 Farmer Mac'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 December 31, 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 December 31, 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 vital liquidity for American agriculture and rural infrastructure. Our secondary market provides liquidity to our nation's agricultural and infrastructure businesses, supporting a vibrant and strong rural America. 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 are uniquely positioned to facilitate competitive access to financing that fuels growth, innovation, and prosperity in America's rural and agricultural communities. Additional information about Farmer Mac is available on our website at www.farmermac.com. 

FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
 CONSOLIDATED 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


$                 1,024,007

Investment securities:




Available-for-sale, at fair value (amortized cost of $6,756,185 and $6,105,116, respectively)

6,674,031


5,953,014

Held-to-maturity, at amortized cost

8,970


9,270

Other investments

14,257


11,017

Total Investment Securities

6,697,258


5,973,301

Farmer Mac Guaranteed Securities:




Available-for-sale, at fair value (amortized cost of $5,942,469 and $5,835,658, respectively)

5,731,503


5,514,546

Held-to-maturity, at amortized cost

2,130,995


2,717,688

Total Farmer Mac Guaranteed Securities

7,862,498


8,232,234

USDA Securities:




Trading, at fair value

560


818

Held-to-maturity, at amortized cost

2,406,638


2,370,534

Total USDA Securities

2,407,198


2,371,352

Loans:




Loans held for sale, at lower of cost or fair value

7,770


6,170

Loans held for investment, at amortized cost

12,226,915


11,183,408

Loans held for investment in consolidated trusts, at amortized cost

2,275,254


2,038,283

Allowance for losses

(29,956)


(23,223)

Total loans, net of allowance

14,479,983


13,204,638

Financial derivatives, at fair value

30,650


27,789

Accrued interest receivable (includes $31,789 and $28,563, respectively, related to consolidated trusts)

313,387


310,592

Guarantee and commitment fees receivable

49,706


50,499

Deferred tax asset, net

3,707


1,544

Prepaid expenses and other assets

121,193


128,786

Total Assets

$               32,995,909


$               31,324,742





Liabilities and Equity:




Liabilities:




Notes payable

$               28,843,331


$               27,371,174

Debt securities of consolidated trusts held by third parties

2,157,962


1,929,628

Financial derivatives, at fair value

53,697


77,326

Accrued interest payable (includes $12,789 and $12,387, respectively, related to consolidated trusts)

210,610


195,113

Guarantee and commitment obligation

47,476


48,326

Accounts payable and accrued expenses

136,906


212,527

Reserve for losses

1,620


1,622

Total Liabilities

31,451,602


29,835,716

Commitments and Contingencies




Equity:




Preferred stock:




Series D, par value $25 per share, 4,000,000 shares authorized, issued and outstanding

96,659


96,659

Series E, par value $25 per share, 3,180,000 shares authorized, issued and outstanding

77,003


77,003

Series F, par value $25 per share, 4,800,000 shares authorized, issued and outstanding

116,160


116,160

Series G, par value $25 per share, 5,000,000 shares authorized, issued and outstanding

121,327


121,327

Common stock:




Class A Voting, $1 par value, no maximum authorization, 1,030,780 shares outstanding

1,031


1,031

Class B Voting, $1 par value, no maximum authorization, 500,301 shares outstanding

500


500

Class C Non-Voting, $1 par value, no maximum authorization, 9,402,503 shares and 9,360,083 shares outstanding, respectively

9,403


9,360

Additional paid-in capital

136,248


135,894

Accumulated other comprehensive loss, net of tax

(17,665)


(12,147)

Retained earnings

1,003,641


943,239

Total Equity

1,544,307


1,489,026

Total Liabilities and Equity

$               32,995,909


$               31,324,742

 

FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
 CONSOLIDATED 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


$          169,462

Farmer Mac Guaranteed Securities and USDA Securities

124,998


166,063


251,340


332,876

Loans

185,039


153,105


356,803


297,685

Total interest income

399,022


403,706


780,436


800,023

Total interest expense

302,225


316,366


592,700


626,315

Net interest income

96,797


87,340


187,736


173,708

Provision for losses

(7,713)


(6,179)


(9,397)


(4,378)

Net interest income after provision for losses

89,084


81,161


178,339


169,330

Non-interest income/(expense):








Guarantee and commitment fees

4,816


3,797


9,295


7,714

Gains/(losses) on financial derivatives

80


(1,799)


(2,556)


280

Losses on sale of mortgage loans

—


(1,147)


—


(1,147)

Gains on sale of available-for-sale investment securities

—


1,052


—


1,052

Provision for/(release of) reserve for losses

(99)


(51)


2


18

Other income

1,040


674


2,476


1,923

Non-interest income

5,837


2,526


9,217


9,840

Operating expenses:








Compensation and employee benefits

17,631


14,840


35,383


33,097

General and administrative

10,859


8,904


21,617


17,159

Regulatory fees

1,000


725


2,000


1,450

Operating expenses

29,490


24,469


59,000


51,706

Income before income taxes

65,431


59,218


128,556


127,464

Income tax expense

10,594


12,113


24,068


26,613

Net income

54,837


47,105


104,488


100,851

Preferred stock dividends

(5,667)


(6,792)


(11,333)


(13,583)

Net income attributable to common stockholders

$            49,170


$            40,313


$            93,155


$            87,268









Earnings per common share:








Basic earnings per common share

$                4.50


$                3.71


$                8.53


$                8.04

Diluted 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


(in thousands, except per share amounts)

Net income attributable to common stockholders

$                    49,170


$                    43,985


$                   40,313

Less 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


2,604

Unrealized (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


26

Net 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)


536

Core earnings

$                    47,365


$                    45,966


$                   39,777







Composition of Core Earnings:






Revenues:






Net effective spread(1)

$                    93,893


$                    89,990


$                   83,596

Guarantee and commitment fees(2)

5,874


5,488


5,256

Gain on sale of investment securities (GAAP)

—


—


1,052

Loss on sale of mortgage loan (GAAP)

—


—


(1,147)

Other(3)

742


1,315


481

Total revenues

100,509


96,793


89,238







Credit related expense/(income) (GAAP):






Provision for losses

7,812


1,583


6,230

REO operating expenses

148


—


—

(Gain)/loss on sale of REO

(87)


68


—

Total credit related expense/(income)

7,873


1,651


6,230







Operating expenses (GAAP):






Compensation and employee benefits

17,631


17,752


14,840

General and administrative

10,859


10,758


8,904

Regulatory fees

1,000


1,000


725

Total operating expenses

29,490


29,510


24,469







Net earnings

63,146


65,632


58,539

Income tax expense(4)

10,114


14,000


11,970

Preferred stock dividends (GAAP)

5,667


5,666


6,792

Core earnings

$                    47,365


$                    45,966


$                   39,777







Core earnings per share:






  Basic

$                        4.33


$                        4.22


$                       3.66

  Diluted

$                        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


(in thousands, except per share amounts)

Net income attributable to common stockholders

$                    93,155


$                    87,268

Less reconciling items:




(Losses)/gains on undesignated financial derivatives due to fair value changes

(3,212)


1,324

Gains on hedging activities due to fair value changes

3,808


5,606

Unrealized losses on trading assets

(56)


(101)

Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value

53


57

Net 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)


4,099

Core earnings

$                    93,331


$                    83,169





Composition of Core Earnings:




Revenues:




Net effective spread(1)

$                  183,883


$                  166,640

Guarantee and commitment fees(2)

11,362


10,238

Gain on sale of investment securities (GAAP)

—


1,052

Loss on sale of mortgage loan (GAAP)

—


(1,147)

Other(3)

2,057


1,558

Total revenues

197,302


178,341





Credit related expense/(income) (GAAP):




Provision for losses

9,395


4,360

REO operating expenses

148


—

Gain on sale of REO

(19)


—

Total credit related expense/(income)

9,524


4,360





Operating expenses (GAAP):




Compensation and employee benefits

35,383


33,097

General and administrative

21,617


17,159

Regulatory fees

2,000


1,450

Total operating expenses

59,000


51,706





Net earnings

128,778


122,275

Income tax expense(4)

24,114


25,523

Preferred stock dividends (GAAP)

11,333


13,583

Core earnings

$                    93,331


$                    83,169





Core earnings per share:




  Basic

$                        8.55


$                        7.66

  Diluted

$                        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


$                8.04

Less reconciling items:










(Losses)/gains on undesignated financial derivatives due to fair value changes

(0.06)


(0.23)


(0.03)


(0.29)


0.12

Gains on hedging activities due to fair value changes

0.25


0.10


0.24


0.35


0.52

Unrealized (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


0.01

Net 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)


0.38

Core Earnings - Basic EPS

$                4.33


$                4.22


$                3.66


$                8.55


$                7.66











Shares used in per share calculation (GAAP and Core Earnings)

10,933


10,896


10,879


10,915


10,863


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, 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


$                7.96

Less reconciling items:










(Losses)/gains on undesignated financial derivatives due to fair value changes

(0.06)


(0.23)


(0.03)


(0.29)


0.12

Gains on hedging activities due to fair value changes

0.25


0.10


0.24


0.35


0.51

Unrealized (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

Net 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)


0.37

Core Earnings - Diluted EPS

$                4.32


$                4.19


$                3.63


$                8.51


$                7.59











Shares 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 June 30, 2025:

Core Earnings by Business Segment

For the Three Months Ended June 30, 2025


Agricultural Finance


Infrastructure Finance


Treasury




Farm & Ranch


Corporate AgFinance


Power &

Utilities


Broadband Infrastructure


Renewable Energy


Funding


Investments


Total


(in thousands)

Interest income

$   152,218


$    25,484


$    67,447


$         12,159


$       23,494


$      35,619


$      82,601


$     399,022

Interest 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


93,893

Guarantee and commitment fees(3)

4,551


224


215


564


320


—


—


5,874

Other 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


$       59,531

















Reconciliation to net income:
















Net effects of derivatives and trading securities















$         2,260

Unallocated (expenses)/income















(12,185)

Income tax effect related to reconciling items















5,231

 Net income















$       54,837

















Total 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


$            —


$            —


$ 30,587,259

Off-balance sheet assets under management















(5,257,348)

Unallocated assets















7,665,998

Total 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
Balance Sheet


As of June 30, 2025


As of December 31, 2024





(in thousands)

Agricultural Finance:







Farm & Ranch:







Loans


On-balance sheet


$                         5,630,602


$                       5,414,732

Loans held in consolidated trusts:







Beneficial interests owned by third-party investors (single-class)(1)


On-balance sheet


877,422


885,295

Beneficial interests owned by third-party investors (structured)(1)


On-balance sheet


1,397,832


1,152,988

IO-FMGS(2)


On-balance sheet


8,369


8,710

USDA Securities


On-balance sheet


2,458,647


2,402,423

AgVantage Securities (1)


On-balance sheet


3,985,000


4,720,000

LTSPCs and unfunded loan commitments


Off-balance sheet


3,019,531


3,070,554

Other Farmer Mac Guaranteed Securities(3)


Off-balance sheet


399,168


426,310

Loans serviced for others


Off-balance sheet


441,334


525,956

Total Farm & Ranch




$                       18,217,905


$                     18,606,968

Corporate AgFinance:







Loans


On-balance sheet


$                         1,450,596


$                       1,381,674

AgVantage Securities (1)


On-balance sheet


259,938


280,297

Unfunded loan commitments


Off-balance sheet


242,989


225,734

Total Corporate AgFinance




$                         1,953,523


$                       1,887,705

Total Agricultural Finance




$                       20,171,428


$                     20,494,673

Infrastructure Finance:







Power & Utilities:







Loans


On-balance sheet


$                         3,162,796


$                       2,886,576

AgVantage Securities (1)


On-balance sheet


3,776,849


3,521,143

LTSPCs and unfunded loan commitments


Off-balance sheet


360,709


401,647

Total Power & Utilities




$                         7,300,354


$                       6,809,366

Broadband Infrastructure:







Loans


On-balance sheet


$                            748,748


$                          622,207

Unfunded loan commitments


Off-balance sheet


425,693


180,259

Total Broadband Infrastructure




$                         1,174,441


$                          802,466

Renewable Energy:







Loans


On-balance sheet


$                         1,573,112


$                       1,265,700

Unfunded loan commitments


Off-balance sheet


367,924


150,825

Total Renewable Energy




$                         1,941,036


$                       1,416,525

Total Infrastructure Finance




$                       10,415,831


$                       9,028,357

Total




$                       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 &

Ranch


Corporate AgFinance


Power & Utilities


Broadband Infrastructure


Renewable Energy


Funding


Investments


Net Effective Spread


Dollars

Yield


Dollars

Yield


Dollars

Yield


Dollars

Yield


Dollars

Yield


Dollars

Yield


Dollars

Yield


Dollars

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


$  81,832

Guarantee and commitment fees

5,874


5,488


5,086


4,997


5,256


4,982


4,865


4,828


4,581

Gain 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


409

Total revenues

100,509


96,793


92,123


91,526


89,238


89,103


90,183


89,308


86,822



















Credit related expense/(income):


















Provision for/(release of) losses

7,812


1,583


3,872


3,258


6,230


(1,870)


(575)


(181)


1,142

REO 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)


1,142



















Operating expenses:


















Compensation and employee benefits

17,631


17,752


15,641


15,237


14,840


18,257


15,523


14,103


13,937

General and administrative

10,859


10,758


12,452


8,625


8,904


8,255


8,916


9,100


9,420

Regulatory fees

1,000


1,000


1,000


725


725


725


725


831


831

Total operating expenses

29,490


29,510


29,093


24,587


24,469


27,237


25,164


24,034


24,188



















Net earnings

63,146


65,632


59,158


63,485


58,539


63,736


65,594


65,455


61,492

Income tax expense

10,114


14,000


9,938


12,681


11,970


13,553


13,881


13,475


12,539

Preferred stock dividends

5,667


5,666


5,666


5,897


6,792


6,791


6,791


6,792


6,791

Core earnings

$  47,365


$   45,966


$   43,554


$   44,907


$  39,777


$  43,392


$   44,922


$   45,188


$  42,162



















Reconciling 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


$    2,141

Gains/(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


29

Net effects of terminations or net settlements on financial derivatives

255


(1,070)


534


(503)


(1,505)


(192)


(800)


(79)


583

Issuance 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)


464

Net 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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SOURCE Farmer Mac