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Sep 30, 2022
Farmer Mac Q3 2022 Earnings Report
Reported outstanding third quarter results, building upon solid financial results delivered in the first half of the year.
Key Takeaways
Farmer Mac announced outstanding results for the third quarter of 2022, with a net growth of $847.2 million in gross business volume, a $8.9 million year-over-year increase in net interest income, and a $9.7 million year-over-year increase in net effective spread.
Added $2.7 billion of gross business volume, resulting in net growth of $847.2 million
Net interest income grew $8.9 million year-over-year to $67.9 million
Net effective spread increased 17% from the prior-year period to a record $65.6 million
Record Core earnings of $33.4 million, or $3.07 per diluted common share, reflecting 21% growth year-over-year
Farmer Mac
Farmer Mac
Farmer Mac Revenue by Geographic Location
Revenue by Geographic Location
Total Revenue
CapyFin.com Forward Guidance
Management's expectations for Farmer Mac's future necessarily involve assumptions and estimates and the evaluation of risks and uncertainties.
Positive Outlook
- the availability to Farmer Mac of debt and equity financing and, if available, the reasonableness of rates and terms
- legislative or regulatory developments that could affect Farmer Mac, its sources of business, or agricultural or rural infrastructure industries
- 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 rural utilities indebtedness
- developments in the financial markets, including possible investor, analyst, and rating agency reactions to events involving government-sponsored enterprises, including Farmer Mac
Challenges Ahead
- fluctuations in the fair value of assets held by Farmer Mac and its subsidiaries
- the effect of economic conditions and geopolitics on agricultural mortgage or rural utilities lending, borrower repayment capacity, or collateral values, including fluctuations in interest rates, changes in U.S. trade policies, fluctuations in export demand for U.S. agricultural products, supply chain disruptions, increases in input costs, labor availability, volatility in commodity prices, and the effects of the conflict between Russia and Ukraine
- 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
- the effects of the Federal Reserve’s efforts to achieve monetary policy normalization and slow inflation
- other factors that could hinder agricultural mortgage lending or borrower repayment capacity, including the effects of severe weather and drought, climate change, or fluctuations in agricultural real estate values