“Loan volume demand has slowed during the past year, as our stockholders have remained cautious attributable to reduced prices for their products,” says John Wheeler, MidAtlantic Farm Credit’s Chief Financial Officer.
WESTMINSTER, Md. (PRWEB) November 27, 2018
MidAtlantic Farm Credit, a members-owned cooperative and an institution of the national Farm Credit system, recently reported their third quarter financial results for 2018. Average accruing loan volume for the first nine months of 2018 was $2.71 billion, an increase of 2.64 percent compared to the same 2017 period. Net income for the quarter was $12.4 million, a 2.12 percent increase compared to the third quarter of 2017. For the first nine months of 2018, net income of $38.3 million was up $2.5 million, a 6.83 percent increase from the same period in 2017. Net interest income for the third quarter was $17.8 million, a 2.24 percent increase from the same time period in 2017.
“Loan volume demand has slowed during the past year, as our stockholders have remained cautious attributable to reduced prices for their products. While our borrowers have experienced a slight increase in their interest rate resulting from the Federal Reserve rate hikes, during this period, our net interest margin has remained relatively constant,” says John Wheeler, MidAtlantic Farm Credit’s Chief Financial Officer.
Nonaccrual loans of $42.0 million at September 30, 2018 were up $19.2 million from December 31, 2017 and up $21.5 million from September 30, 2017. The Association’s nonaccrual loans as a percentage of total loans also increased to 1.51 percent at the end of the third quarter of 2018, compared to 0.76 percent at September 30, 2017. The Association recorded a $3 million provision for loan losses in the first nine months of 2018, compared to $1.5 million recorded in the same 2017 period. The allowance for loan losses represented 69 percent of nonaccrual loans at September 30, 2018, compared to 126 percent at September 30, 2017.
Thomas Truitt, Chief Executive Office of MidAtlantic Farm Credit, states, “While we are beginning to see a slight decline in our credit quality and an increase in our nonaccrual loans, our portfolio quality overall remains very strong. We increased our membership almost two percent during the past twelve months, further supporting the significant role that Farm Credit plays in providing dependable and reliable financing to farmers and rural areas in our marketplace.”
At September 30, 2018, shareholders’ equity totaled $634.2 million, up 4.42 percent from December 31, 2017, and the Total Capital Ratio was 21.30 percent. That number is compared with the 8.0 percent minimum mandated by the Farm Credit Administration (FCA), the lender’s independent regulator.
About MidAtlantic Farm Credit
MidAtlantic Farm Credit is an agricultural lending cooperative owned by its member‐borrowers. It provides farm loans for land, equipment, livestock and production; crop insurance; and rural home mortgages. The co-op has over 11,600 members and over $2.7 billion in loans outstanding. MidAtlantic has branches serving Delaware, Maryland, Pennsylvania, Virginia and West Virginia. It is part of the national Farm Credit System, a network of financial cooperatives established in 1916 to provide a dependable source of credit to farmers and rural America.