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Farmer Mac has announced its second-quarter 2023 earnings, with impressive results that exceeded previous records in revenues, core earnings, and net effective spread. The company’s capital base remains strong, allowing it to fulfill its long-term strategic growth objectives and act as a buffer against market volatility.

During the second quarter, Farmer Mac reported core earnings of .2 million, a 37% increase compared to the same period last year. The company achieved gross new business volume of .2 billion, bringing the total outstanding business volume to .7 billion as of June 30, 2023. This growth was driven by diversifying the business model across key markets and acquiring mortgage servicing rights on 0 million of Farm & Ranch loans held by a third party.

The expansion of loan servicing functions has allowed Farmer Mac to scale its portfolio while increasing process transparency and efficiency. It has also given the company more oversight and governance of its portfolio and improved security and access to data.

In the agricultural finance line of business, Farmer Mac saw over 0 million in growth in the second quarter, mainly due to the acquisition of loan servicing rights and growth in the corporate AgFinance segment. The company has been successful in building its reputation in this market and has received invitations to participate in deals with large well-known counterparts.

The Farm & Ranch segment has seen moderate activity due to the higher interest rate environment, but prepayment rates remain low. However, there has been an increase in loan applications and approvals as borrowers adjust to the new rate environment. Farmer Mac’s scorecard underwriting product, AgXpress, has been enhanced to allow for more loans with higher loan-to-value ratios, aligning with market standards without increasing credit risk appetite.

In the rural infrastructure line of business, the Renewable Energy segment has shown steady growth. Farmer Mac’s participation in syndicated renewable energy transactions has increased opportunities with key counterparts, and the pipeline remains strong.

These strong earnings demonstrate the resilience of Farmer Mac’s business model and the success of strategic initiatives in delivering profitable growth while supporting rural America and generating shareholder returns.

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