Farm Credit reports near 30 percent loan growth

The Tenth Farm Credit District, a network of rural financing cooperatives, reported outstanding first quarter financial results highlighted by record growth and earnings. The district is composed of the Austin-based Farm Credit Bank of Texas and 20 rural lending institutions in Alabama, Louisiana, Mississippi, New Mexico and Texas. Total loans outstanding increase to almost $13.5 billion as of March 31, 2007 up 4.4 percent from $12.9 billion on Dec. 31, 2006 and up 29.9 percent from $10.4 billion reported March 31, 2006. The overall quality of the loan portfolio remained very strong with 98.90 percent of all loans classified as acceptable at March 31, 2007, a slight increase from a year earlier. Net income totaled $67.1 million for the three months ended March 31, 2007, up 18.5 percent from the $56.6 million reported for the same period in 2006. This increase was largely due to a 14.1 percent increase in net interest income driven by higher loan volume and an increase in net interest income driven by higher loan volume and an increase in non interest income. “To achieve 30 percent loan growth and an 18.5 percent increase in net income over the same quarter a year ago is outstanding, to do so while also improving credit quality is particularly significant,” said Larry Doyle, FCBT chief executive officer. “These results attest to our association’ sharp focus on competitive loan pricing, customer service and increased efforts to penetrate their local markets.” The cooperative structure of the Tenth District financing allows them to distribute patronage, thereby reducing their borrowers’ costs of financing. In 2006, the Tenth District’s 20 lending cooperatives declared more than $124.8 million in cash and equity patronage distributions. The Farm Credit Bank of Texas reported strong first quarter results, highlighted by $17.5 million in net income as of March 31. This was an increase of 11.5 percent from a year earlier. The Tenth District lenders provide loans and financial services to agricultural producers, agribusiness firms, country homeowners and other rural landowners. They are part of the nationwide Farm Credit System established by Congress in 1916.

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