Farmer Mac Prices $100 Million of Series H Preferred Stock

Rhea-AI Summary

Farmer Mac (NYSE: AGM) has announced the pricing of $100 million of Tier 1 capital through a public offering of 6.500% non-cumulative perpetual Series H preferred stock. The preferred stock will have a par value of $25.00 per share and will be listed on the NYSE under the symbol "AGM PRH".

The Series H preferred stock will carry a fixed dividend rate of 6.500% per year, subject to board declaration, with no maturity date. Farmer Mac retains the option to redeem the preferred stock on any dividend payment date after October 17, 2030. The offering is expected to close on August 25, 2025, with RBC Capital Markets serving as the Sole Book-Running Manager.

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• None.

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• 6.500% dividend rate represents ongoing cost of capital
• New preferred stock issuance may impact existing shareholder returns

Insights

Capital Markets Specialist

Farmer Mac's $100M preferred stock issuance strengthens its Tier 1 capital position, enhancing financial stability while maintaining dividend flexibility.

Farmer Mac's $100 million Series H preferred stock issuance represents a strategic capital-raising move that strengthens its Tier 1 regulatory capital position. The non-cumulative perpetual structure gives the company significant flexibility - it has no maturity date and dividends are paid only when declared by the Board. The 6.500% fixed dividend rate appears reasonably priced in the current interest rate environment for a financial institution with Farmer Mac's risk profile.

This issuance demonstrates Farmer Mac's proactive capital management approach. The redemption option after October 2030 provides long-term capital stability while allowing future flexibility if market conditions change. As a government-sponsored enterprise focused on agricultural financing, maintaining strong capital ratios is crucial for Farmer Mac's lending operations.

The transaction's structure as Tier 1 capital is particularly notable, as it counts toward the highest quality regulatory capital that helps the institution absorb potential losses. This strengthens Farmer Mac's ability to fulfill its mission of providing liquidity to agricultural and rural infrastructure businesses. The $100 million raise will likely enhance Farmer Mac's lending capacity in its target markets while maintaining appropriate leverage ratios.

WASHINGTON, Aug. 20, 2025 /PRNewswire/ -- The Federal Agricultural Mortgage Corporation (Farmer Mac; NYSE: AGM and AGM.A) today announced that it has agreed to issue $100 million of Tier 1 capital through the public offering of 6.500% non-cumulative perpetual Series H preferred stock, par value $25.00 per share. The preferred stock offering is expected to close on August 25, 2025, subject to customary closing conditions. Farmer Mac expects to list the new series of preferred stock on the New York Stock Exchange under the symbol "AGM PRH."

The dividend rate on the new Series H preferred stock will remain at a non-cumulative, fixed rate of 6.500% per year, when, as, and if a dividend is declared by the Board of Directors of Farmer Mac, for so long as the Series H preferred stock remains outstanding. The Series H preferred stock will have no maturity date, but Farmer Mac will have the option to redeem the preferred stock on any dividend payment date on and after October 17, 2030. RBC Capital Markets, LLC served as the Sole Book-Running Manager for this transaction.

The offering is being made pursuant to an exemption from registration under the Securities Act of 1933, as amended, and is being made solely by means of an offering circular. You may obtain a copy of the offering circular by contacting RBC Capital Markets, LLC, Brookfield Place, 200 Vesey Street, 8^th Floor, New York, NY 10281, toll-free: 1-866-375-6829 or email: rbcnyfixedincomeprospectus@rbccm.com.

Forward-Looking Statements

In addition to historical information, this release includes forward-looking statements that reflect management's current expectations for the preferred stock offering, Farmer Mac's intended use of the proceeds from the offering and the closing date of the offering. You should pay particular attention to the important risk factors and cautionary statements described tin the "Risk Factors" section of the offering circular that relates to the offering referenced above, as well as the risk factors discussed in Farmer Mac's Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC, on February 21, 2025, and Farmer Mac's Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, as filed with the SEC on August 7, 2025. In light of these potential risks and uncertainties, no undue reliance should be placed on any forward-looking statements expressed in this release. The forward-looking statements contained in this release represent management's expectations as of the date of this release. Farmer Mac undertakes no obligation to release publicly the results of revisions to any forward-looking statements included in the release to reflect new information or any future events or circumstances, except as the SEC otherwise requires.

About Farmer Mac
Farmer Mac is driven by its mission to increase the accessibility of financing to provide vital liquidity for American agriculture and rural infrastructure. Our secondary market provides liquidity to our nation's agricultural and infrastructure businesses, supporting a vibrant and strong rural America. We offer a wide range of solutions to help meet financial institutions' growth, liquidity, risk management, and capital relief needs across diverse markets, including agriculture, agribusiness, broadband infrastructure, power and utilities, and renewable energy. We are uniquely positioned to facilitate competitive access to financing that fuels growth, innovation, and prosperity in America's rural and agricultural communities. Additional information about Farmer Mac is available on our website at www.farmermac.com.

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SOURCE Farmer Mac

FAQ

What is the size and dividend rate of Farmer Mac's Series H preferred stock offering?

Farmer Mac is offering $100 million of Series H preferred stock with a fixed dividend rate of 6.500% per year, non-cumulative.

When can Farmer Mac (AGM) redeem the Series H preferred stock?

Farmer Mac can redeem the Series H preferred stock on any dividend payment date on and after October 17, 2030.

What is the trading symbol for Farmer Mac's new preferred stock?

The new Series H preferred stock will trade on the NYSE under the symbol AGM PRH.

When will Farmer Mac's Series H preferred stock offering close?

The preferred stock offering is expected to close on August 25, 2025, subject to customary closing conditions.

What is the par value of Farmer Mac's Series H preferred shares?

The Series H preferred stock has a par value of $25.00 per share.