Through the second quarter, Farm Credit staff converted $1.5 billion in current customer loans to lower interest rates, helping maintain volume levels and saving customers an estimated $18 million in interest expense each year.
Louisville, KY (Vocus) August 28, 2009
Farm Credit Services of Mid-America (FCS), an ag lending cooperative serving over 85,000 farmers, rural residents and agribusinesses throughout Indiana, Kentucky, Ohio and Tennessee, announced earnings of $68 million through the second quarter of 2009. Additionally, loan volume and assets totaled over $15 billion at quarter-end, representing an increase of over 8% compared to a year ago.
President and Chief Executive Officer Donnie Winters said earning were down from 2008 when the association recorded $87 million. "While part of this decline is due to higher insurance costs and operating expenses, it is primarily driven by increased provision for loan losses. We are projecting to finish the year with earnings of approximately $130 million which evidences our ability to withstand credit challenges and still generate strong earnings and build capital and risk bearing ability," he said.
Non accrual loan volume was 1.6% of the loan portfolio compared to .55% at June 30, 2008. The current economic environment has caused the association to experience some credit deterioration, according to Winters. "Adverse business, loan related assets and loan losses are all up, but all are at or below plan, so we believe this is very manageable. We have a strong capital position and are well positioned to meet the financial needs of farmers and rural America," he said.
Winters added that the association's commitment to rural America remains strong citing conversion activity as one example. "Through the second quarter, Farm Credit staff converted $1.5 billion in current customer loans to lower interest rates, helping maintain volume levels and saving customers an estimated $18 million in interest expense each year."
Another example is the ag lender continues to make over $1 million in investments annually in community programs such as scholarships, youth and young farmer groups and commodity organizations, all of which are vital to the local landscape of rural America.
"The bottom line is our cost of funds to customers continues to be the lowest in the Farm Credit System. In the end, it's our goal to meet our mission of providing the best and most competitive products and services available to farmers and rural residents and we will continue to do what it takes to meet marketplace demands, whatever those demands might be," he said.
About Farm Credit Services of Mid-America:
Farm Credit Services of Mid-America is a $15.5 billion financial services cooperative serving over 85,500 farmers, agribusinesses and rural residents in Kentucky, Ohio, Indiana and Tennessee. The association provides loans for farm and rural living purposes including real estate, operating, equipment and housing and related services such as crop and life insurance and vehicle, equipment and building leases. For more information about Farm Credit, call 1-800-444-FARM or go online at http://www.e-farmcredit.com.
Contact: Randy Barbee
Email: rbarbee (at) e-farmcredit.com