Federal Agricultural Mortgage (NYSE: AGM) net income hits 66,951 in Q2 2026
Rhea-AI Filing Summary
Federal Agricultural Mortgage Corporation (Farmer Mac) reported Q2 2026 net income of $66,951 (in thousands), up from $54,837 (in thousands) in Q2 2025. Net income for the first six months was $126,074 (in thousands) versus $104,488 (in thousands) a year earlier. Basic EPS was $5.43 for the quarter and $10.21 year-to-date.
Total interest income was $450,260 (in thousands) and net interest income $118,075 (in thousands) for the quarter, both higher than the prior year, driven by loan interest of $235,038 (in thousands). Loans, net of allowance, reached $18,180,844 (in thousands), compared with $16,321,276 (in thousands) at December 31, 2025.
Total assets were $39,290,192 (in thousands) as of June 30, 2026, including $19,425,162 (in thousands) of investment securities and $1,038,091 (in thousands) of cash and cash equivalents. Notes payable were $34,693,922 (in thousands). The allowance for losses increased to $47,167 (in thousands). Farmer Mac reported core capital of $1.9 billion, about $730.7 million above its $1.1 billion minimum capital requirement.
Positive
- None.
Negative
- None.
Filing Explained
Farmer Mac added perpetual preferred funding, repurchased Class C shares, and retained substantial contingent commitments and near-term debt maturities as of June 30, 2026.
The 10-Q is an unaudited quarterly report; for the quarter ended
In May, the company issued
During the first half of 2026, Farmer Mac repurchased 47,319 Class C shares for approximately
The company also reports
A future update will show whether the outstanding repurchase authorization is used before its
Key Figures
Q2 2026 Net Income: $66,951 (in thousands)
Six-Month Net Income 2026: $126,074 (in thousands)
Q2 2026 Net Interest Income: $118,075 (in thousands)
+5 more
8 metrics
Q2 2026 Net Income
$66,951 (in thousands)
For the three months ended June 30, 2026
Six-Month Net Income 2026
$126,074 (in thousands)
For the six months ended June 30, 2026
Q2 2026 Net Interest Income
$118,075 (in thousands)
For the three months ended June 30, 2026
Loans, net of allowance
$18,180,844 (in thousands)
As of June 30, 2026
Total Assets
$39,290,192 (in thousands)
As of June 30, 2026
Allowance for Losses
$47,167 (in thousands)
Loans allowance as of June 30, 2026
Notes Payable
$34,693,922 (in thousands)
Outstanding borrowings as of June 30, 2026
Basic EPS Q2 2026
$5.43 per share
Net income attributable to common stockholders for Q2 2026
Key Terms
Variable Interest Entities, AgVantage Securities, cash flow hedges, portfolio layer method, +2 more
6 terms
Variable Interest Entities financial
"The consolidated financial statements also include the accounts of Variable Interest Entities ("VIEs")"
A variable interest entity (VIE) is a business that a company controls through contracts or special arrangements instead of owning a majority of its shares, like steering a puppet without holding its ticket. Investors care because these arrangements can hide who really bears the financial risks and rewards, affect how assets and liabilities appear on financial statements, and create extra legal or enforcement uncertainty that can change the value and risk of an investment.
AgVantage Securities financial
"AgVantage Securities: securities backed by corporate obligations of approved agricultural"
cash flow hedges financial
"Net unrealized (losses)/gains on cash flow hedges"
A cash flow hedge is an accounting label companies use when they enter financial contracts—like currency or interest-rate agreements—to protect expected future cash payments or receipts from unpredictable moves. For investors, it signals that the company is trying to smooth out future cash variability (think of locking in a price to avoid surprises), which can reduce reported profit swings but also means the company has exposure to derivative instruments and their associated risks.
portfolio layer method financial
"closed portfolio of loans hedged under the portfolio layer method had an amortized cost"
long-term standby purchase commitments financial
"stand ready under Farmer Mac's long-term standby purchase commitments ("LTSPCs")"
Tier 1 capital financial
"policy for maintaining a sufficient level of Tier 1 capital (consisting of retained earnings"
Tier 1 capital is a bank’s core financial cushion—mainly common stock, retained earnings and certain reserves—that can absorb losses while the bank keeps operating. Investors care because it signals a lender’s ability to survive stress, meet regulatory requirements and continue lending or paying dividends; think of it as the engine’s safety margin that keeps a car running through bumps in the road.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
How much net income did Federal Agricultural Mortgage (AGM) earn in Q2 2026?
Federal Agricultural Mortgage (AGM) generated Q2 2026 net income of $66,951 (in thousands), compared with $54,837 (in thousands) in Q2 2025. For the first six months of 2026, net income was $126,074 (in thousands), up from $104,488 (in thousands) a year earlier.
What is the size of AGM’s balance sheet and loan portfolio as of June 30, 2026?
As of June 30, 2026, AGM had total assets of $39,290,192 (in thousands). Loans, net of allowance for losses, were $18,180,844 (in thousands), and investment securities totaled $19,425,162 (in thousands), reflecting growth from December 31, 2025 levels.
How strong is Federal Agricultural Mortgage (AGM)’s capital position?
AGM reported a minimum capital requirement of $1.1 billion and core capital of $1.9 billion as of June 30, 2026. Core capital exceeded the minimum requirement by about $730.7 million, compared with $677.7 million excess capital at December 31, 2025.
What were AGM’s net interest income and interest income in Q2 2026?
In Q2 2026, AGM recorded total interest income of $450,260 (in thousands) and net interest income of $118,075 (in thousands). Loan interest contributed $235,038 (in thousands), while interest from investment securities and cash equivalents contributed $215,222 (in thousands).
How did AGM’s credit loss allowance and nonaccrual loans look at June 30, 2026?
AGM’s allowance for losses was $47,167 (in thousands) at June 30, 2026, up from $37,785 (in thousands) at December 31, 2025. Nonaccrual loans totaled $240,133 (in thousands), including $52.4 million of nonaccrual loans with no associated allowance.
As filed with the Securities and Exchange Commission on July 30, 2026
| UNITED STATES | ||||||||||||||
| SECURITIES AND EXCHANGE COMMISSION | ||||||||||||||
| WASHINGTON, D.C. 20549 | ||||||||||||||
Form | ||||||||||||||
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended June 30, 2026
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from _____ to _____.
Commission File Number 001-14951
| (Exact name of registrant as specified in its charter) | ||
Federally chartered instrumentality of the | |||||||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification number) | ||||||||||
| (Address of principal executive offices) | (Zip code) | ||||||||||
| (Registrant's telephone number, including area code) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Exchange on which registered | ||||||||||||
Securities registered pursuant to Section 12(g) of the Act: Class B voting common stock
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| ☒ | Accelerated filer | ☐ | |||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
| Emerging growth company | |||||||||||
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒
As of July 23, 2026, the registrant had outstanding 1,030,780 shares of Class A voting common stock, 500,301 shares of Class B voting common stock, and 9,322,129 shares of Class C non-voting common stock.
1
Table of Contents
PART I | ||||||||
Item 1. | Financial Statements | 3 | ||||||
Consolidated Balance Sheets | 3 | |||||||
Consolidated Statements of Operations | 4 | |||||||
Consolidated Statements of Comprehensive Income | 5 | |||||||
Consolidated Statements of Equity | 6 | |||||||
Consolidated Statements of Cash Flows | 7 | |||||||
Notes to Consolidated Financial Statements | 8 | |||||||
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 45 | ||||||
Forward-Looking Statements | 45 | |||||||
Overview | 47 | |||||||
Use of Non-GAAP Measures | 50 | |||||||
Results of Operations | 51 | |||||||
Outlook | 63 | |||||||
Balance Sheet Review | 68 | |||||||
Risk Management | 69 | |||||||
Liquidity and Capital Resources | 77 | |||||||
Other Matters | 78 | |||||||
Supplemental Information | 79 | |||||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 86 | ||||||
Item 4. | Controls and Procedures | 86 | ||||||
PART II | 87 | |||||||
Item 1. | Legal Proceedings | 87 | ||||||
Item 1A. | Risk Factors | 87 | ||||||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 87 | ||||||
Item 3. | Defaults Upon Senior Securities | 87 | ||||||
Item 4. | Mine Safety Disclosures | 87 | ||||||
Item 5. | Other Information | 88 | ||||||
Item 6. | Exhibits | 88 | ||||||
Signatures | 91 | |||||||
2
PART I
Item 1.Financial Statements
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
| As of | |||||||||||
| June 30, 2026 | December 31, 2025 | ||||||||||
| (in thousands) | |||||||||||
| Assets: | |||||||||||
Cash and cash equivalents (includes restricted cash of $ | $ | $ | |||||||||
| Investment securities: | |||||||||||
Available-for-sale, at fair value (amortized cost of $ | |||||||||||
| Held-to-maturity, at amortized cost | |||||||||||
Other investments | |||||||||||
Total Investment Securities | |||||||||||
| Loans: | |||||||||||
| Loans held for investment, at amortized cost | |||||||||||
| Loans held for investment in consolidated trusts, at amortized cost | |||||||||||
| Allowance for losses | ( | ( | |||||||||
| Total loans, net of allowance | |||||||||||
| Financial derivatives, at fair value | |||||||||||
Accrued interest receivable (includes $ | |||||||||||
| Guarantee and commitment fees receivable | |||||||||||
| Deferred tax asset, net | |||||||||||
| Prepaid expenses and other assets | |||||||||||
| Total Assets | $ | $ | |||||||||
| Liabilities and Equity: | |||||||||||
| Liabilities: | |||||||||||
| Notes payable | $ | $ | |||||||||
| Debt securities of consolidated trusts held by third parties | |||||||||||
| Financial derivatives, at fair value | |||||||||||
Accrued interest payable (includes $ | |||||||||||
| Guarantee and commitment obligation | |||||||||||
| Other liabilities | |||||||||||
| Total Liabilities | |||||||||||
Commitments and Contingencies (Note 5) | |||||||||||
| Equity: | |||||||||||
| Preferred stock: | |||||||||||
Series D, par value $ | |||||||||||
Series E, par value $ | |||||||||||
Series F, par value $ | |||||||||||
Series G, par value $ | |||||||||||
Series H, par value $ | |||||||||||
Series I, par value $ | |||||||||||
| Common stock: | |||||||||||
Class A Voting, $ | |||||||||||
Class B Voting, $ | |||||||||||
Class C Non-Voting, $ | |||||||||||
| Additional paid-in capital | |||||||||||
Accumulated other comprehensive (loss)/income, net of tax | ( | ||||||||||
| Retained earnings | |||||||||||
| Total Equity | |||||||||||
| Total Liabilities and Equity | $ | $ | |||||||||
The accompanying notes are an integral part of these consolidated financial statements.
3
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | ||||||||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||||||||||
| Interest income: | |||||||||||||||||||||||
| Investment securities and cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Loans | |||||||||||||||||||||||
| Total interest income | |||||||||||||||||||||||
| Total interest expense | |||||||||||||||||||||||
| Net interest income | |||||||||||||||||||||||
| Provision for losses | ( | ( | ( | ( | |||||||||||||||||||
| Net interest income after provision for losses | |||||||||||||||||||||||
| Non-interest income/(expense): | |||||||||||||||||||||||
| Guarantee and commitment fees | |||||||||||||||||||||||
| Gains/(losses) on financial derivatives | ( | ||||||||||||||||||||||
| Other income | |||||||||||||||||||||||
| Non-interest income | |||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Compensation and employee benefits | |||||||||||||||||||||||
| General and administrative | |||||||||||||||||||||||
| Regulatory fees | |||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||
| Income before income taxes | |||||||||||||||||||||||
| Income tax expense | |||||||||||||||||||||||
| Net income | |||||||||||||||||||||||
| Preferred stock dividends | ( | ( | ( | ( | |||||||||||||||||||
| Net income attributable to common stockholders | $ | $ | $ | $ | |||||||||||||||||||
| Earnings per common share: | |||||||||||||||||||||||
| Basic earnings per common share | $ | $ | $ | $ | |||||||||||||||||||
| Diluted earnings per common share | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
4
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Other comprehensive income/(loss): | |||||||||||||||||||||||
Net unrealized (losses)/gains on available-for-sale securities | ( | ( | ( | ||||||||||||||||||||
| Net changes in held-to-maturity securities | ( | ||||||||||||||||||||||
| Net unrealized (losses)/gains on cash flow hedges | ( | ( | |||||||||||||||||||||
| Other comprehensive loss before tax | ( | ( | ( | ( | |||||||||||||||||||
| Income tax benefit related to other comprehensive loss | |||||||||||||||||||||||
| Other comprehensive loss net of tax | ( | ( | ( | ( | |||||||||||||||||||
| Comprehensive income | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
5
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited)
| Accumulated | |||||||||||||||||||||||||||||||||||||||||||||||
| Additional | Other | ||||||||||||||||||||||||||||||||||||||||||||||
| Preferred Stock | Common Stock | Paid-In | Comprehensive | Retained | Total | ||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Income/(Loss) | Earnings | Equity | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2025 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
| Net Income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
| Dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of $ | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Repurchase of Class C Common Stock | — | — | ( | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Issuance of Class C Common Stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation cost | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2026 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Net Income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
| Dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Issuance of Series I Preferred Stock | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class C Common Stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation cost | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2026 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2024 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Net Income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of $ | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Issuance of Class C Common Stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation cost | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2025 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Net Income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
| Dividends: | |||||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common stock (cash dividend of $ | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Issuance of Class C Common Stock | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation cost | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Other stock-based award activity | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2025 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
6
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
| For the Six Months Ended | |||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||
| (in thousands) | |||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Net amortization of deferred gains, premiums, and discounts on loans, investments, Farmer Mac Guaranteed Securities, and USDA Securities | ( | ( | |||||||||
| Net amortization of debt premiums, discounts, and issuance costs | ( | ||||||||||
| Net change in fair value of hedged items, financial derivatives, loans held for sale, and trading securities | ( | ||||||||||
Total provision for allowance for losses | |||||||||||
| Stock-based compensation expense | |||||||||||
| Purchases of loans held for sale | ( | ||||||||||
| Proceeds from repayment of loans purchased as held for sale | |||||||||||
Purchases of tax credits | ( | ( | |||||||||
Other | ( | ( | |||||||||
| Net change in: | |||||||||||
| Interest receivable | ( | ( | |||||||||
| Guarantee and commitment fees receivable | ( | ( | |||||||||
| Other assets | |||||||||||
| Accrued interest payable | |||||||||||
| Custodial deposit liability | ( | ( | |||||||||
| Other liabilities | ( | ||||||||||
Net cash provided by operating activities | ( | ||||||||||
| Cash flows from investing activities: | |||||||||||
Purchases of available-for-sale investment securities | ( | ( | |||||||||
Purchases of held-to-maturity investment securities | ( | ( | |||||||||
| Purchases of other investment securities | ( | ( | |||||||||
| Purchases of loans held for investment | ( | ( | |||||||||
Purchases of defaulted loans | ( | ( | |||||||||
Proceeds from repayment of available-for-sale investment securities | |||||||||||
Proceeds from repayment of held-to-maturity investment securities | |||||||||||
| Proceeds from repayment of loans purchased as held for investment | |||||||||||
Proceeds from sale of real estate owned | |||||||||||
| Proceeds from sale of loans previously classified as held for investment | |||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
Proceeds from issuance of notes payable | |||||||||||
| Proceeds from issuance of debt securities of consolidated trusts | |||||||||||
Payments to redeem notes payable | ( | ( | |||||||||
| Payments to third parties on debt securities of consolidated trusts | ( | ( | |||||||||
Purchases of common stock | ( | ||||||||||
| Proceeds from common stock issuance | |||||||||||
| Proceeds from preferred stock issuance, net of stock issuance costs | |||||||||||
| Tax payments related to share-based awards | ( | ( | |||||||||
| Dividends paid on common and preferred stock | ( | ( | |||||||||
| Net cash provided by financing activities | |||||||||||
| Net change in cash and cash equivalents | |||||||||||
Cash, cash equivalents, and restricted cash at beginning of period | |||||||||||
Cash, cash equivalents, and restricted cash at end of period | $ | $ | |||||||||
| Non-cash activity: | |||||||||||
Loans acquired through non-cash transactions | |||||||||||
| Loans held for investment transferred to consolidated trusts | |||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
7
FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The interim unaudited consolidated financial statements of the Federal Agricultural Mortgage Corporation ("Farmer Mac") and subsidiaries have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). These interim unaudited consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the financial position and the results of operations and cash flows of Farmer Mac and subsidiaries for the interim periods presented. Certain information and footnote disclosures normally included in the annual consolidated financial statements have been omitted as permitted by SEC rules and regulations. The December 31, 2025 consolidated balance sheet presented in this report has been derived from Farmer Mac's audited 2025 consolidated financial statements. Management believes that the disclosures are adequate to present fairly the consolidated financial statements as of the dates and for the periods presented. These interim unaudited consolidated financial statements should be read in conjunction with the 2025 consolidated financial statements of Farmer Mac and subsidiaries included in Farmer Mac's Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on February 19, 2026. Results for interim periods are not necessarily indicative of those that may be expected for the fiscal year. Presented below are Farmer Mac's significant accounting policies that contain updated information for the six months ended June 30, 2026.
Principles of Consolidation
The consolidated financial statements include the accounts of Farmer Mac and its two subsidiaries: (1) Farmer Mac Mortgage Securities Corporation, whose principal activities are to facilitate the purchase and issuance of Farmer Mac Guaranteed Securities; and (2) Farmer Mac II LLC, which operated substantially all of the business related to the USDA Securities included in the Agricultural Finance line of business from 2010 through 2023 and continues to hold a "run-off" portfolio of USDA Securities. The consolidated financial statements also include the accounts of Variable Interest Entities ("VIEs") in which Farmer Mac determined itself to be the primary beneficiary.
The following table provides a summary of unconsolidated VIEs with which Farmer Mac has significant continuing involvement but is not the primary beneficiary. The balances presented in the table below exclude certain transactions with unconsolidated VIEs where Farmer Mac's continuing involvement is insignificant. Farmer Mac considers continuing involvement to be insignificant when it relates to a VIE where Farmer Mac only invests in securities issued by the VIE and where Farmer Mac was not involved in the design of the VIE or where no transfers have occurred between Farmer Mac and the VIE.
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Table 1.1
Unconsolidated VIEs | |||||||||||||||||||||||||||||||||||
| As of June 30, 2026 | As of December 31, 2025 | ||||||||||||||||||||||||||||||||||
Max Exposure to Loss(1) | Carrying Value of Assets(2) | Carrying Value of Liabilities(3) | Max Exposure to Loss(1) | Carrying Value of Assets(2) | Carrying Value of Liabilities(3) | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
| Farmer Mac Guaranteed Securities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
(1)Farmer Mac uses the guaranteed portion of unpaid principal balance or amortized cost as applicable to represent maximum exposure to loss.
(2)Included in Investment securities, Guarantee and commitment fees receivable, and Prepaid expenses and other assets on our Consolidated Balance Sheets.
(3)Included in Guarantee and commitment obligation and Other liabilities on our Consolidated Balance Sheets. The weighted average remaining maturity of the loans underlying the guarantee was 20.1 years and 20.7 years as of June 30, 2026 and December 31, 2025, respectively.
(a)Earnings Per Common Share
Table 1.2
| For the Three Months Ended | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||
| Net Income | Weighted-Average Shares | $ per Share | Net Income | Weighted-Average Shares | $ per Share | ||||||||||||||||||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||||||||||||||||||||||
| Basic EPS | |||||||||||||||||||||||||||||||||||
| Net income attributable to common stockholders | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Effect of dilutive securities(1) | |||||||||||||||||||||||||||||||||||
SARs and restricted stock units | — | ( | — | ( | |||||||||||||||||||||||||||||||
| Diluted EPS | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
(1)For the three months ended June 30, 2026 and 2025, SARs and restricted stock units of 56,568 and 76,166 , respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive. For the three months ended June 30, 2026 and 2025, contingent shares of unvested restricted stock units of 10,962 and 29,507 , respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.
| For the Six Months Ended | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||
| Net Income | Weighted-Average Shares | $ per Share | Net Income | Weighted-Average Shares | $ per Share | ||||||||||||||||||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||||||||||||||||||||||
| Basic EPS | |||||||||||||||||||||||||||||||||||
| Net income attributable to common stockholders | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Effect of dilutive securities(1) | |||||||||||||||||||||||||||||||||||
SARs and restricted stock units | — | ( | — | ( | |||||||||||||||||||||||||||||||
| Diluted EPS | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
(1)For the six months ended June 30, 2026 and 2025, SARs and restricted stock units of 48,646 and 67,353 , respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive. For the six months ended June 30, 2026 and 2025, contingent shares of unvested restricted stock units of 10,962 and 29,507 , respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.
9
(b)Comprehensive Income
The following table presents the changes in accumulated other comprehensive income ("AOCI"), net of tax, by component for the three and six months ended June 30, 2026 and 2025.
Table 1.3
| As of June 30, 2026 | As of June 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||
AFS Securities | HTM Securities | Cash Flow Hedges | Total | AFS Securities | HTM Securities | Cash Flow Hedges | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||
Other comprehensive (loss)/income before reclassifications | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
| Amounts reclassified from AOCI | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Net comprehensive (loss)/income | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
| Ending Balance | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||
For the Six Months Ended: | |||||||||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | $ | $ | ( | $ | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||||
| Other comprehensive (loss)/income before reclassifications | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Amounts reclassified from AOCI | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Net comprehensive income/(loss) | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
| Ending Balance | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||
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The following table presents other comprehensive income activity, the impact on net income of amounts reclassified from each component of AOCI, and the related tax impact for the three and six months ended June 30, 2026 and 2025:
Table 1.4
| For the Three Months Ended | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||
| Before Tax | Provision (Benefit) | After Tax | Before Tax | Provision (Benefit) | After Tax | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
Other comprehensive (loss)/ income: | |||||||||||||||||||||||||||||||||||
AFS securities: | |||||||||||||||||||||||||||||||||||
Unrealized holding (losses)/gains on AFS securities | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
| Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Other income(1) | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||
| Total | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
HTM securities: | |||||||||||||||||||||||||||||||||||
| Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(2) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Cash flow hedges | |||||||||||||||||||||||||||||||||||
Unrealized gains/(losses) on cash flow hedges | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
| Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(3) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
Other comprehensive (loss)/income | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
(1)Represents amortization of deferred gains related to certain AFS USDA Securities and Farmer Mac Guaranteed USDA Securities.
(2)Represents amortization of unrealized gain/loss reported in AOCI prior to the reclassification of certain securities from AFS to HTM, which occurred at fair value. The unrealized gain/loss will be amortized over the securities' remaining life with no impact on future net income.
(3)Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI.
11
| For the Six Months Ended | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||
| Before Tax | Provision (Benefit) | After Tax | Before Tax | Provision (Benefit) | After Tax | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
Other comprehensive (loss)/ income: | |||||||||||||||||||||||||||||||||||
AFS securities: | |||||||||||||||||||||||||||||||||||
Unrealized holding (losses)/gains on AFS securities | $ | ( | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||
| Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Other income(1) | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||
| Total | $ | ( | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||
HTM securities: | |||||||||||||||||||||||||||||||||||
| Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(2) | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
| Cash flow hedges | |||||||||||||||||||||||||||||||||||
Unrealized gains/(losses) on cash flow hedges | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
| Less reclassification adjustments included in: | |||||||||||||||||||||||||||||||||||
Net interest income(3) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||
Other comprehensive (loss)/income | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
(1)Represents amortization of deferred gains related to certain AFS USDA Securities and Farmer Mac Guaranteed USDA Securities.
(2)Represents amortization of unrealized gain/loss reported in AOCI prior to the reclassification of certain securities from AFS to HTM, which occurred at fair value. The unrealized gain/loss will be amortized over the securities' remaining life with no impact on future net income.
(3)Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI.
(c)New Accounting Standards
Recently Adopted Accounting Guidance
Standard | Description | Date of Adoption | Effect on Consolidated Financial Statements | ||||||||
ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements | ASU 2025-09 amends ASC 815 to align hedge accounting more closely with the economics of an entity's risk management practices. Among other things, key amendments include: similar risk assessment for cash flow hedges, hedging interest payments on choose-your-rate debt, cash flow hedges of nonfinancial forecasted transactions, and net written options as hedging instruments. | January 1, 2026 | Farmer Mac adopted the new standard on a prospective basis. The adoption of this amendment did not have a material impact on Farmer Mac's financial position, results of operations, or cash flows. See Note 3 to the financial statements. | ||||||||
12
Recently Issued Accounting Guidance, Not Yet Adopted Within Our Consolidated Financial Statements
Farmer Mac is still assessing the impact of the new accounting standards in the table below but does not expect that adoption of the new guidance will have a material impact on Farmer Mac's financial position, results of operations, or cash flows.
Standard | Description | ||||
ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses | This Update requires public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. | ||||
ASU 2025-06, Intangibles - Goodwill and Other - Internal-use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software | This Update amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. It removes all references to "development stages" and establishes new criteria to be met for the entity to begin capitalizing software costs. New guidance is then given for how to evaluate whether the probable-to-complete recognition threshold has been met. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, with early adoption permitted. | ||||
ASU 2025-08, Financial Instruments - Credit Losses (Topic 326): Purchased Loans | This Update expands the scope of the "gross-up" approach from applicable only to purchased credit-deteriorated ("PCD") assets to include financial assets acquired without credit deterioration and deemed "seasoned." Non-PCD loans are seasoned if they were purchased at least 90 days after origination and the acquirer was not involved in the origination of the loans. Under this model, an allowance for expected credit losses is recognized at acquisition, offsetting the loan's amortized cost basis, thereby eliminating the day-one credit-loss expense previously required for non-PCD assets. ASU 2025-08 is effective for annual periods beginning after December 15, 2026, and interim periods within those annual reporting periods, with early adoption permitted. | ||||
ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements | This Update clarifies interim disclosure requirements, including providing a comprehensive list of interim disclosure requirements under U.S. GAAP and a disclosure principle that requires entities to disclose events since the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods, with early adoption permitted. | ||||
(d)Reclassifications
Certain reclassifications of prior period information were made to conform to the current period presentation. The reclassifications of prior period information were not material to the consolidated financial statements.
2.INVESTMENT SECURITIES
Farmer Mac’s investment securities portfolio is comprised primarily of the following major portfolios, which is based on the issuer and associated security characteristics:
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Liquidity Investments:
•U.S. Government guaranteed securities: single-family and multi-family mortgage-backed securities ("MBS") issued by Government National Mortgage Association (Ginnie Mae) and pass-through securities issued by the Small Business Administration, which are guaranteed by the U.S. Government;
•Government-sponsored enterprise ("GSE") guaranteed securities: single-family and multi-family MBS issued by Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac). GSE securities are not guaranteed by the U.S. government;
•U.S. Treasury Obligations: sovereign debt issued by the United States of America.
Program Investments:
•AgVantage Securities: securities backed by corporate obligations of approved agricultural or rural infrastructure financial institution counterparties, backed by a pledge of eligible agricultural or infrastructure finance loans.
•USDA Securities: securities backed by the guaranteed portion of a loan guaranteed by the USDA under the Consolidated Farm and Rural Development Act.
•Asset-backed Securities ("ABS"): consist of senior secured notes supported by cash flows from underlying operating rural infrastructure assets.
The following tables set forth information about Farmer Mac's AFS and HTM investment securities as of June 30, 2026 and December 31, 2025:
Table 2.1
| As of June 30, 2026 | |||||||||||||||||||||||||||||
Amortized Cost(1) | Allowance for Losses(2) | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
AFS: | |||||||||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
U.S. Treasuries | ( | ||||||||||||||||||||||||||||
ABS | |||||||||||||||||||||||||||||
| AgVantage | ( | ( | |||||||||||||||||||||||||||
| Interest-Only Farmer Mac Guaranteed Securities | |||||||||||||||||||||||||||||
Total AFS | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
HTM: | |||||||||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| AgVantage | ( | ( | |||||||||||||||||||||||||||
| USDA Securities | ( | ||||||||||||||||||||||||||||
Total HTM | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
(1)Excludes $98.9 million and $47.5 million of accrued interest receivable on AFS and HTM securities, respectively, as of June 30, 2026.
(2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the Consolidated Statement of Operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors.
14
| As of December 31, 2025 | |||||||||||||||||||||||||||||
Amortized Cost(1) | Allowance for Losses(2) | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
AFS: | |||||||||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
| U.S. Treasuries | ( | ||||||||||||||||||||||||||||
| AgVantage | ( | ( | |||||||||||||||||||||||||||
| Interest-Only Farmer Mac Guaranteed Securities | |||||||||||||||||||||||||||||
Total AFS | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
HTM: | |||||||||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| AgVantage | ( | ( | |||||||||||||||||||||||||||
| USDA Securities | ( | ||||||||||||||||||||||||||||
Total HTM | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
(1)Excludes $91.3 million and $56.7 million of accrued interest receivable on AFS and HTM securities, respectively, as of December 31, 2025.
(2)Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the Consolidated Statement of Operations as a provision for losses. Amount excludes unrealized losses relating to non-credit factors.
As of June 30, 2026 and December 31, 2025, to satisfy initial margin requirements for centrally cleared derivatives, Farmer Mac pledged U.S. Treasuries with fair value of $309.8 million and $250.6 million, respectively.
Farmer Mac did not sell any securities from its AFS or HTM investment portfolios during the three and six months ended June 30, 2026 and 2025.
As of June 30, 2026 and December 31, 2025, unrealized losses on AFS investment securities were as follows:
Table 2.2
| As of June 30, 2026 | |||||||||||||||||||||||
AFS Securities | |||||||||||||||||||||||
| Unrealized loss position for less than 12 months | Unrealized loss position for more than 12 months | ||||||||||||||||||||||
| Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | ( | $ | $ | ( | |||||||||||||||||
U.S. Treasuries | ( | ( | |||||||||||||||||||||
| AgVantage | ( | ( | |||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| As of December 31, 2025 | |||||||||||||||||||||||
AFS Securities | |||||||||||||||||||||||
| Unrealized loss position for less than 12 months | Unrealized loss position for more than 12 months | ||||||||||||||||||||||
| Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | ( | $ | $ | ( | |||||||||||||||||
U.S. Treasuries | ( | ( | |||||||||||||||||||||
| AgVantage | ( | ( | |||||||||||||||||||||
| Total | $ | $ | ( | $ | $ | ( | |||||||||||||||||
15
The unrealized losses presented above are primarily due to changes in the levels of interest rates from the dates of acquisition to June 30, 2026 and December 31, 2025, as applicable.
The amortized cost, fair value, and weighted-average yield of AFS and HTM investment securities by remaining contractual maturity as of June 30, 2026 are set forth below. ABS and MBS are included based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets.
Table 2.3
| As of June 30, 2026 | |||||||||||||||||
AFS Securities | |||||||||||||||||
Amortized Cost(1) | Fair Value | Weighted-Average Yield | |||||||||||||||
| (dollars in thousands) | |||||||||||||||||
| Due within one year | $ | $ | % | ||||||||||||||
| Due after one year through five years | % | ||||||||||||||||
| Due after five years through ten years | % | ||||||||||||||||
| Due after ten years | % | ||||||||||||||||
| Total | $ | $ | % | ||||||||||||||
(1)Excludes $98.9 million of accrued interest receivable.
| As of June 30, 2026 | |||||||||||||||||
HTM Securities | |||||||||||||||||
Amortized Cost(1) | Fair Value | Weighted-Average Yield | |||||||||||||||
| (dollars in thousands) | |||||||||||||||||
| Due within one year | $ | $ | % | ||||||||||||||
| Due after one year through five years | % | ||||||||||||||||
| Due after five years through ten years | % | ||||||||||||||||
| Due after ten years | % | ||||||||||||||||
| Total | $ | $ | % | ||||||||||||||
(1)Excludes $47.5 million of accrued interest receivable.
3.FINANCIAL DERIVATIVES
The following tables summarize information related to Farmer Mac's financial derivatives on a gross basis without giving consideration to master netting arrangements. The table below includes accrued interest on cleared swaps, but excludes $38.1 million and $24.2 million of accrued interest receivable and $1.5 million and $2.4 million of accrued interest payable on uncleared swaps as of June 30, 2026 and December 31, 2025, respectively. The aforementioned accrued interest on uncleared swaps is included within and Accrued Interest Payable on the consolidated balance sheets.
16
Table 3.1
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Fair Value | Weighted- Average Pay Rate | Weighted- Average Receive Rate | Weighted- Average Forward Price | Weighted- Average Remaining Term (in years) | |||||||||||||||||||||||||||||||||||||
| Notional Amount | Asset | (Liability) | |||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Fair value hedges: | |||||||||||||||||||||||||||||||||||||||||
| Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
| Receive fixed non-callable | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
| Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Receive fixed callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Cash flow hedges: | |||||||||||||||||||||||||||||||||||||||||
| Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
| Pay fixed non-callable | |||||||||||||||||||||||||||||||||||||||||
| No hedge designation: | |||||||||||||||||||||||||||||||||||||||||
| Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
| Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Receive fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Basis swaps | ( | ||||||||||||||||||||||||||||||||||||||||
| Treasury futures | ( | ||||||||||||||||||||||||||||||||||||||||
Netting adjustments(1) | — | ( | |||||||||||||||||||||||||||||||||||||||
| Total financial derivatives | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
(1)Amounts represent the application of the netting requirements that allow Farmer Mac to settle positive and negative positions, including accrued interest, held or placed with the same clearing agent.
| As of December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Fair Value | Weighted- Average Pay Rate | Weighted- Average Receive Rate | Weighted- Average Forward Price | Weighted- Average Remaining Term (in years) | |||||||||||||||||||||||||||||||||||||
| Notional Amount | Asset | (Liability) | |||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Fair value hedges: | |||||||||||||||||||||||||||||||||||||||||
| Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
| Receive fixed non-callable | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
| Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Receive fixed callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Cash flow hedges: | |||||||||||||||||||||||||||||||||||||||||
| Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
| Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
| No hedge designation: | |||||||||||||||||||||||||||||||||||||||||
| Interest rate swaps: | |||||||||||||||||||||||||||||||||||||||||
| Pay fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Receive fixed non-callable | ( | ||||||||||||||||||||||||||||||||||||||||
| Basis swaps | ( | ||||||||||||||||||||||||||||||||||||||||
| Treasury futures | ( | ||||||||||||||||||||||||||||||||||||||||
Netting adjustments(1) | — | ( | |||||||||||||||||||||||||||||||||||||||
| Total financial derivatives | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||
17
As of June 30, 2026, Farmer Mac expects to reclassify $7.4 million after-tax from accumulated other comprehensive income to earnings over the next twelve months related to cash flow hedges. This amount could differ from amounts actually recognized due to changes in interest rates, hedge de-designations, and the addition of other hedges after June 30, 2026.
The following tables summarize the net income/(expense) recognized in the Consolidated Statements of Operations related to derivatives for the three and six months ended June 30, 2026, and 2025:
Table 3.2
For the Three Months Ended June 30, 2026 | |||||||||||||||||||||||||||||
| Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
| Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
| Interest Income Investments and Cash Equivalents | Interest Income Loans | Total Interest Expense | Gains/(losses) on financial derivatives | ||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
Total amounts presented in the Consolidated Statement of Operations | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
| Net effects of fair value hedging relationships: | |||||||||||||||||||||||||||||
| Recognized on derivatives | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
| Recognized on hedged items | ( | ( | ( | ||||||||||||||||||||||||||
| Amounts related to interest settlements on derivatives | ( | ||||||||||||||||||||||||||||
| Net effects of fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
| Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
| Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Net effects of cash flow hedges | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Gains/(losses) on financial derivatives not designated in hedging relationships: | |||||||||||||||||||||||||||||
| Gains on interest rate swaps | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Interest expense on interest rate swaps | |||||||||||||||||||||||||||||
| Treasury futures | ( | ( | |||||||||||||||||||||||||||
| Net effects of financial derivatives not designated in hedge relationships | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
18
For the Three Months Ended June 30, 2025 | |||||||||||||||||||||||||||||
| Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
| Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
| Interest Income Investments and Cash Equivalents | Interest Income Loans | Total Interest Expense | Gains/(losses) on financial derivatives | ||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
Total amounts presented in the Consolidated Statement of Operations | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Net effects of fair value hedging relationships: | |||||||||||||||||||||||||||||
| Recognized on derivatives | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
| Recognized on hedged items | ( | ||||||||||||||||||||||||||||
Amounts related to interest settlements on derivatives | ( | ||||||||||||||||||||||||||||
Net effects of fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
| Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
| Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Net effects of cash flow hedges | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Gains/(losses) on financial derivatives not designated in hedging relationships: | |||||||||||||||||||||||||||||
Losses on interest rate swaps | $ | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||||
| Interest expense on interest rate swaps | ( | ( | |||||||||||||||||||||||||||
| Treasury futures | |||||||||||||||||||||||||||||
Net effects of financial derivatives not designated in hedge relationships | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
19
For the Six Months Ended June 30, 2026 | |||||||||||||||||||||||||||||
| Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
| Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
| Interest Income Investments and Cash Equivalents | Interest Income Loans | Total Interest Expense | Gains/(losses) on financial derivatives | ||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
Total amounts presented in the Consolidated Statement of Operations | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
Net effects of fair value hedging relationships: | |||||||||||||||||||||||||||||
| Recognized on derivatives | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
| Recognized on hedged items | ( | ( | ( | ||||||||||||||||||||||||||
Amounts related to interest settlements on derivatives | ( | ||||||||||||||||||||||||||||
Net effects of fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
| Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
| Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Net effects of cash flow hedges | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Gains/(losses) on financial derivatives not designated in hedging relationships: | |||||||||||||||||||||||||||||
Losses on interest rate swaps | $ | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||||
| Interest expense on interest rate swaps | |||||||||||||||||||||||||||||
| Treasury futures | |||||||||||||||||||||||||||||
Net effects of financial derivatives not designated in hedge relationships | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
20
For the Six Months Ended June 30, 2025 | |||||||||||||||||||||||||||||
| Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives | |||||||||||||||||||||||||||||
| Net Interest Income | Non-Interest Income | Total | |||||||||||||||||||||||||||
| Interest Income Investments and Cash Equivalents | Interest Income Loans | Total Interest Expense | Gains/(losses) on financial derivatives | ||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
| Total amounts presented in the Consolidated Statement of Operations: | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships: | |||||||||||||||||||||||||||||
| Recognized on derivatives | $ | ( | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||
| Recognized on hedged items | ( | ||||||||||||||||||||||||||||
Amounts related to interest settlements on derivatives | ( | ||||||||||||||||||||||||||||
(Losses)/gains on fair value hedging relationships | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||
| Expense related to interest settlements on cash flow hedging relationships: | |||||||||||||||||||||||||||||
| Interest settlements reclassified from AOCI into net income on derivatives | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Expense recognized on cash flow hedges | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Losses on financial derivatives not designated in hedge relationships: | |||||||||||||||||||||||||||||
Losses on interest rate swaps | $ | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||||
| Interest expense on interest rate swaps | |||||||||||||||||||||||||||||
| Treasury futures | |||||||||||||||||||||||||||||
Losses on financial derivatives not designated in hedge relationships | $ | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||||
The following table displays the carrying amount of the hedged items and associated cumulative basis adjustment related to the application of hedge accounting that is included in the carrying amount of hedged assets and liabilities in fair value hedging relationships as of June 30, 2026 and December 31, 2025:
Table 3.3
| Hedged Items in Fair Value Relationship | |||||||||||||||||||||||
| Carrying Amount of Hedged Assets/(Liabilities) | Cumulative Amount of Fair Value Hedging Adjustments included in the Carrying Amount of the Hedged Assets/(Liabilities) | ||||||||||||||||||||||
June 30, 2026 | December 31, 2025 | June 30, 2026 | December 31, 2025 | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
Investment securities, AFS, at fair value(1) | $ | $ | $ | ( | $ | ( | |||||||||||||||||
Loans held for investment, at amortized cost(2) | ( | ( | |||||||||||||||||||||
Notes Payable(3) | ( | ( | ( | ||||||||||||||||||||
(1)Amortized cost of $8.9 billion and $8.0 billion as of June 30, 2026 and December 31, 2025, respectively.
(2)As of June 30, 2026, closed portfolio of loans hedged under the portfolio layer method had an amortized cost of $0.8 billion, of which $66.2 million was designated as the hedged item. The remaining amount of amortized cost is from hedges not designated under the portfolio layer method. There were no portfolio layer hedges as of December 31, 2025.
(3)Carrying amount represents amortized cost.
21
The following tables present the fair value of financial assets and liabilities, based on the terms of Farmer Mac's master netting arrangements as of June 30, 2026 and December 31, 2025:
Table 3.4
| June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Gross Amount Recognized | Gross Amounts offset in the Consolidated Balance Sheet | Net Amount Presented in the Consolidated Balance Sheet(1) | Gross Amounts Not Offset in the Consolidated Balance Sheet | ||||||||||||||||||||||||||||||||||||||
| Netting Adjustments | Financial instruments pledged | Cash Collateral | Net Amount(2) | ||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||
| Uncleared derivatives | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Cleared derivatives | ( | ||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | ( | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||||||||||||||||||||
| Uncleared derivatives | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||
| Cleared derivatives | ( | ||||||||||||||||||||||||||||||||||||||||
| Total | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||
(1)Amounts presented may not agree to the consolidated balance sheet related to counterparties not subject to master netting agreements.
(2)Any over-collateralization at an individual clearing agent and/or counterparty level is not included in the determination of the net amount. As of June 30, 2026, Farmer Mac had additional net exposure of $309.8 million due to instances where Farmer Mac's collateral to a counterparty exceeded the net derivative position and $2.2 million due to instances where Farmer Mac's collateral from a counterparty exceeded the net derivative position.
| December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Gross Amount Recognized | Gross Amounts offset in the Consolidated Balance Sheet | Net Amount Presented in the Consolidated Balance Sheet(1) | Gross Amounts Not Offset in the Consolidated Balance Sheet | ||||||||||||||||||||||||||||||||||||||
| Netting Adjustments | Financial instruments pledged | Cash Collateral | Net Amount(2) | ||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||
| Uncleared derivatives | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
| Cleared derivatives | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||||||||||||||||||||
| Uncleared derivatives | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||
| Cleared derivatives | ( | ||||||||||||||||||||||||||||||||||||||||
| Total | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||
(1)Amounts presented may not agree to the consolidated balance sheet related to counterparties not subject to master netting agreements.
(2)Any over-collateralization at an individual clearing agent and/or counterparty level is not included in the determination of the net amount. As of December 31, 2025, Farmer Mac had additional net exposure of $235.0 million due to instances where Farmer Mac's collateral to a counterparty exceeded the net derivative position and $16.9 million due to instances where Farmer Mac's collateral from a counterparty exceeded the net derivative position.
Farmer Mac records posted cash as a reduction in the outstanding balance of cash and cash equivalents and an increase in the balance of prepaid expenses and other assets. Any investment securities posted as collateral are included in the investment securities balances on the Consolidated Balance Sheets. If Farmer Mac had breached certain provisions of the derivative contracts as of June 30, 2026 or December 31, 2025, it could have been required to settle its obligations under the agreements, but would not have been required to post additional collateral. As of June 30, 2026 and December 31, 2025, there were no
22
derivatives in a net payable position where Farmer Mac was required to pledge collateral which the counterparty had the right to sell or repledge.
4.LOANS
Under the Agricultural Finance line of business, Farmer Mac has two segments – Farm & Ranch and Corporate AgFinance. Farmer Mac monitors and assesses credit risk for each segment, recognizing the different credit risk profiles within each segment.
The following table includes loans held for investment and displays the composition of the loan balances as of June 30, 2026 and December 31, 2025:
Table 4.1
| As of June 30, 2026 | As of December 31, 2025 | ||||||||||||||||||||||||||||||||||
| Unsecuritized | In Consolidated Trusts | Total | Unsecuritized | In Consolidated Trusts | Total | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
| Agricultural Finance loans | |||||||||||||||||||||||||||||||||||
| Farm & Ranch | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Corporate AgFinance | |||||||||||||||||||||||||||||||||||
| Total Agricultural Finance loans | |||||||||||||||||||||||||||||||||||
| Infrastructure Finance loans | |||||||||||||||||||||||||||||||||||
Total unpaid principal balance(1) | |||||||||||||||||||||||||||||||||||
| Unamortized premiums, discounts, fair value hedge basis adjustment, and other cost basis adjustments | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Total loans | |||||||||||||||||||||||||||||||||||
| Allowance for losses | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
| Total loans, net of allowance | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
23
Allowance for Losses
The following table is a summary, by asset type, of the allowance for losses as of June 30, 2026 and December 31, 2025:
Table 4.2
| June 30, 2026 | December 31, 2025 | ||||||||||
| Allowance for Losses | Allowance for Losses | ||||||||||
| (in thousands) | |||||||||||
| Loans: | |||||||||||
| Agricultural Finance loans | |||||||||||
| Farm & Ranch | $ | $ | |||||||||
| Corporate AgFinance | |||||||||||
| Infrastructure Finance loans | |||||||||||
| Total | $ | $ | |||||||||
The following is a summary of the changes in the allowance for losses for the three and six months ended June 30, 2026 and 2025:
Table 4.3
| June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance loans | Infrastructure Finance loans(3) | Total | Agricultural Finance loans | Infrastructure Finance loans(3) | Total | ||||||||||||||||||||||||||||||||||||||||||
Farm & Ranch(1) | Corporate AgFinance(2) | Farm & Ranch(1) | Corporate AgFinance(2) | ||||||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| For the Three Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Provision for losses | |||||||||||||||||||||||||||||||||||||||||||||||
| Charge-offs | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Recovery | |||||||||||||||||||||||||||||||||||||||||||||||
| Ending Balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| For the Six Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Provision for losses | |||||||||||||||||||||||||||||||||||||||||||||||
| Charge-offs | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Recovery | |||||||||||||||||||||||||||||||||||||||||||||||
| Ending Balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1)As of June 30, 2026 and 2025, the allowance for losses for Agricultural Finance Farm & Ranch loans includes $7.6 million and $1.7 million allowance for collateral dependent assets ("CDA") secured by agricultural real estate, respectively.
(2)As of June 30, 2026 and 2025 the allowance for losses for Agricultural Finance Corporate AgFinance loans includes $0.0 million and $1.0 million allowance for CDA secured by agricultural real estate, respectively.
The $7.0 million and $11.4 million provision to the allowance during the three and six months ended June 30, 2026 is primarily attributed to new volume growth across all of our segments and portfolio credit migration.
The $7.7 million and $9.5 million net provision to the allowance during the three and six months ended June 30, 2025 was primarily attributable to borrower specific downgrades and new volume growth.
24
The following table presents the unpaid principal balances by delinquency status of Farmer Mac's loans as of June 30, 2026 and December 31, 2025:
Table 4.4
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Accruing | |||||||||||||||||||||||||||||||||||||||||
| Current | 30-59 Days | 60-89 Days | 90 Days and Greater | Total Past Due | Nonaccrual Loans(2)(3) | Total Loans | |||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
Loans(1): | |||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance loans | |||||||||||||||||||||||||||||||||||||||||
| Farm & Ranch | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Corporate AgFinance | |||||||||||||||||||||||||||||||||||||||||
| Total Agricultural Finance loans | |||||||||||||||||||||||||||||||||||||||||
| Infrastructure Finance loans | |||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Includes loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.
(3)Includes $52.4 million of nonaccrual loans for which there was no associated allowance. During the three and six months ended June 30, 2026, Farmer Mac received $12.2 million and $15.8 million, respectively, in interest on nonaccrual loans.
| As of December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Accruing | |||||||||||||||||||||||||||||||||||||||||
| Current | 30-59 Days | 60-89 Days | 90 Days and Greater | Total Past Due | Nonaccrual Loans(2)(3) | Total Loans | |||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
Loans(1): | |||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance loans | |||||||||||||||||||||||||||||||||||||||||
| Farm & Ranch | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Corporate AgFinance | |||||||||||||||||||||||||||||||||||||||||
| Total Agricultural Finance loans | |||||||||||||||||||||||||||||||||||||||||
| Infrastructure Finance loans | |||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Primarily consists of loans that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.
(3)Includes $59.2 million of nonaccrual loans for which there was no associated allowance. During the year ended December 31, 2025, Farmer Mac received $6.5 million in interest on nonaccrual loans.
25
Credit Quality Indicators
The following tables present credit quality indicators related to Agricultural Finance mortgage loans and Infrastructure Finance loans held as of June 30, 2026 and December 31, 2025, by year of origination:
Table 4.5
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2024 | 2023 | 2022 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Agricultural Finance - Farm & Ranch loans(1): | |||||||||||||||||||||||||||||||||||||||||||||||
| Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
| Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2026: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Six Months Ended June 30, 2026: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Special mention assets generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.
(3)Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.
26
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2024 | 2023 | 2022 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Agricultural Finance - Corporate AgFinance(1): | |||||||||||||||||||||||||||||||||||||||||||||||
| Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
| Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2026: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| For the Six Months Ended June 30, 2026: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Special mention assets generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.
(3)Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2024 | 2023 | 2022 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Infrastructure Finance loans(1): | |||||||||||||||||||||||||||||||||||||||||||||||
| Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
| Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2026: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| For the Six Months Ended June 30, 2026: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Special mention assets generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.
(3)Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.
27
| As of December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2023 | 2022 | 2021 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Agricultural Finance - Farm & Ranch loans(1): | |||||||||||||||||||||||||||||||||||||||||||||||
| Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
| Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2025: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Six Months Ended June 30, 2025: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Special mention assets generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.
(3)Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.
| As of December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2023 | 2022 | 2021 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Agricultural Finance - Corporate AgFinance loans(1): | |||||||||||||||||||||||||||||||||||||||||||||||
| Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
| Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2025: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| For the Six Months Ended June 30, 2025: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Special mention assets generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.
(3)Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.
28
| As of December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year of Origination: | |||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2023 | 2022 | 2021 | Prior | Revolving Loans - Amortized Cost Basis | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Infrastructure Finance loans(1): | |||||||||||||||||||||||||||||||||||||||||||||||
| Internally Assigned Risk Rating: | |||||||||||||||||||||||||||||||||||||||||||||||
| Acceptable | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Special mention(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Substandard(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2025: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| For the Six Months Ended June 30, 2025: | |||||||||||||||||||||||||||||||||||||||||||||||
| Current period charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on unpaid principal less charge-offs.
(2)Special mention assets generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.
(3)Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.
Loan Modifications to Borrowers Experiencing Financial Difficulty
As part of its loss mitigation activities, Farmer Mac may agree to modify the contractual terms of loans to borrowers experiencing financial difficulty. These modifications generally consist of payment deferrals and, less frequently, term extensions.
The impact of modifications granted to borrowers experiencing financial difficulty and their subsequent performance is incorporated into Farmer Mac’s allowance methodology. Post-modification performance is monitored through payment performance, delinquency status, risk ratings, collateral values, and collection activity, with changes in these factors reflected in the allowance for credit losses.
The disclosures below are presented beginning in the current period. Comparable prior-period information has not been presented because the related activity was not material in prior periods.
The following table presents the amortized cost and the weighted average financial effect of modifications, as of June 30, 2026 granted to Agricultural Finance and Infrastructure Finance borrowers experiencing financial difficulty during the three and six months ended June 30, 2026:
29
Table 4.6
| June 30, 2026 | |||||||||||||||||||||||||||||||||||
Payment Deferrals(1) | Term Extensions(1) | Total(3) | Percentage of Total by Financing Class | ||||||||||||||||||||||||||||||||
Amount | Financial Effect(2) | Amount | Financial Effect(2) | ||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||
| For the Three Months Ended | |||||||||||||||||||||||||||||||||||
Agricultural Finance(4): | |||||||||||||||||||||||||||||||||||
| Farm & Ranch | $ | $ | $ | % | |||||||||||||||||||||||||||||||
| Infrastructure Finance | $ | $ | — | $ | % | ||||||||||||||||||||||||||||||
| For the Six Months Ended | |||||||||||||||||||||||||||||||||||
Agricultural Finance: | |||||||||||||||||||||||||||||||||||
Farm & Ranch | $ | $ | $ | % | |||||||||||||||||||||||||||||||
Infrastructure Finance | $ | $ | — | $ | % | ||||||||||||||||||||||||||||||
(1)Amounts presented are the amortized cost of modified loans, excluding modified loans that were paid off, charged off, or otherwise liquidated as of June 30, 2026.
(2)Represents the weighted average of payment deferrals and term extensions, in months, as a result of the modification granted.
(3)The unfunded lending commitments on the modifications granted during the six months ended June 30, 2026 were $2.2 million.
(4)There were no modifications within the Corporate AgFinance segment during the periods presented above.
The following table presents the performance of the loans under the modified terms as of June 30, 2026, of loan modifications granted during the six months preceding June 30, 2026:
Table 4.7
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||
| Current | 30-59 Days | 60-89 Days | 90 Days and Greater | Total Past Due | Total Loans | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
Agricultural Finance(1)(2): | |||||||||||||||||||||||||||||||||||
Farm & Ranch | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Infrastructure Finance(1)(2) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
(1)Current loan amounts are presented based on contractual amortized cost, while past due loan amounts are presented at the contractual amortized cost less charge-offs.
(2)Amounts presented are the amortized cost of modified loans, excluding modified loans that were paid off, charged off, or otherwise liquidated as of June 30, 2026.
Farmer Mac generally considers modifications to borrowers experiencing financial difficulty to have subsequently defaulted when the modified loan becomes 90 days past due following the modification. Loans that subsequently defaulted during both the three and six month periods ended June 30, 2026 totaled $11.0
30
5.GUARANTEES AND COMMITMENTS
Farmer Mac has recorded a liability for its obligation to stand ready under Farmer Mac's long-term standby purchase commitments ("LTSPCs") in the guarantee and commitment obligation on the consolidated balance sheets. The following table presents Farmer Mac's liability, the maximum principal amount of potential undiscounted future payments that Farmer Mac could be requested to make under all LTSPCs (excluding offsets from recourse provisions, third-party recoveries, or loan collateral), the weighted-average remaining maturity of loans underlying LTSPCs, and the amount of the reserve for losses for the periods indicated:
Table 5.1
| As of June 30, 2026 | As of December 31, 2025 | ||||||||||
| (dollars in thousands) | |||||||||||
Guarantee and commitment obligation | $ | $ | |||||||||
| Maximum principal amount | |||||||||||
| Weighted-average remaining maturity | |||||||||||
| Reserve for losses | |||||||||||
6.NOTES PAYABLE
Farmer Mac's borrowings consist of discount notes and medium-term notes, both of which are unsecured general obligations of Farmer Mac. Discount notes generally have original maturities of 1 year or less, whereas medium-term notes generally have original maturities of 0.5 years to 25.0 years.
31
The following tables set forth information related to Farmer Mac's borrowings as of June 30, 2026 and December 31, 2025:
Table 6.1
| June 30, 2026 | |||||||||||||||||||||||
| Outstanding as of June 30 | Average Outstanding During the Quarter | ||||||||||||||||||||||
| Amount | Weighted-Average Rate | Amount | Weighted-Average Rate | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
| Due within one year: | |||||||||||||||||||||||
| Discount notes | $ | % | $ | % | |||||||||||||||||||
| Medium-term notes | % | % | |||||||||||||||||||||
| Current portion of medium-term notes | % | ||||||||||||||||||||||
| Total due within one year | $ | % | |||||||||||||||||||||
| Due after one year: | |||||||||||||||||||||||
| Medium-term notes due in: | |||||||||||||||||||||||
| Two years | $ | % | |||||||||||||||||||||
| Three years | % | ||||||||||||||||||||||
| Four years | % | ||||||||||||||||||||||
| Five years | % | ||||||||||||||||||||||
| Thereafter | % | ||||||||||||||||||||||
| Total due after one year | $ | % | |||||||||||||||||||||
| Total principal net of discounts | $ | % | |||||||||||||||||||||
| Hedging adjustments | ( | ||||||||||||||||||||||
| Total | $ | ||||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| Outstanding as of December 31 | Average Outstanding During the Year | ||||||||||||||||||||||
| Amount | Weighted- Average Rate | Amount | Weighted- Average Rate | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
| Due within one year: | |||||||||||||||||||||||
| Discount notes | $ | % | $ | % | |||||||||||||||||||
| Medium-term notes | % | % | |||||||||||||||||||||
| Current portion of medium-term notes | % | ||||||||||||||||||||||
| Total due within one year | $ | % | |||||||||||||||||||||
| Due after one year: | |||||||||||||||||||||||
| Medium-term notes due in: | |||||||||||||||||||||||
| Two years | $ | % | |||||||||||||||||||||
| Three years | % | ||||||||||||||||||||||
| Four years | % | ||||||||||||||||||||||
| Five years | % | ||||||||||||||||||||||
| Thereafter | % | ||||||||||||||||||||||
| Total due after one year | $ | % | |||||||||||||||||||||
| Total principal net of discounts | $ | % | |||||||||||||||||||||
| Hedging adjustments | |||||||||||||||||||||||
| Total | $ | ||||||||||||||||||||||
32
The maximum amount of Farmer Mac's discount notes outstanding at any month end during each of the six months ended June 30, 2026 and 2025 was $2.2 billion and $2.1 billion, respectively.
Callable medium‑term notes give Farmer Mac the option to redeem the debt at par value on specified call dates or, depending on the instrument, periodically on or after a specified call date. The following table summarizes by maturity date the amounts and weighted average interest rate for Farmer Mac debt callable in 2026 as of June 30, 2026:
Table 6.2
Debt Callable in 2026 as of June 30, 2026, by Maturity | |||||||||||
| Amount | Weighted-Average Rate | ||||||||||
| (dollars in thousands) | |||||||||||
| Maturity: | |||||||||||
| 2027 | $ | % | |||||||||
| 2028 | % | ||||||||||
| 2029 | % | ||||||||||
| 2030 | % | ||||||||||
| Thereafter | % | ||||||||||
| Total | $ | % | |||||||||
The following schedule summarizes the earliest interest rate reset date, or debt maturities, of total borrowings outstanding as of June 30, 2026, including callable and non-callable medium-term notes, assuming callable notes are redeemed at the initial call date:
Table 6.3
| Earliest Interest Rate Reset Date, or Debt Maturities, of Borrowings Outstanding | |||||||||||
| Amount | Weighted-Average Rate | ||||||||||
| (dollars in thousands) | |||||||||||
| Debt with interest rate resets, or debt maturities in: | |||||||||||
| 2026 | $ | % | |||||||||
| 2027 | % | ||||||||||
| 2028 | % | ||||||||||
| 2029 | % | ||||||||||
| 2030 | % | ||||||||||
| Thereafter | % | ||||||||||
| Total principal net of discounts | $ | % | |||||||||
During the six months ended June 30, 2026 and 2025, Farmer Mac called $1.6 billion and $1.2 billion of callable medium-term notes, respectively.
Authority to Borrow from the U.S. Treasury
Farmer Mac's statutory Charter authorizes it to borrow up to $1.5 billion from the U.S. Treasury through the issuance of debt obligations to the U.S. Treasury. Any funds borrowed from the U.S. Treasury may be used solely to fulfill Farmer Mac's guarantee obligations. The Charter provides that the U.S. Treasury is required to purchase debt obligations up to the authorized limit if Farmer Mac certifies that:
33
•a portion of the guarantee fees have been set aside as a reserve against losses arising from guarantee activities in an amount determined by Farmer Mac's board of directors to be necessary and such reserve has been exhausted; and
•the proceeds of the purchase of such obligations are needed to fulfill Farmer Mac's guarantee obligations.
Any debt obligations issued by Farmer Mac under this authority would bear interest at a rate determined by the U.S. Treasury, taking into consideration the average rate on outstanding marketable obligations of the United States as of the last day of the last calendar month ending before the date of the purchase of the obligations from Farmer Mac. The Charter requires Farmer Mac to repurchase any of its debt obligations held by the U.S. Treasury within a reasonable time. As of June 30, 2026, Farmer Mac had not used this borrowing authority.
7.EQUITY
Common Stock
During the first and second quarters of 2026, Farmer Mac paid a quarterly dividend of $1.60 1.50
On May 13, 2026, Farmer Mac's board of directors revised the terms of the share repurchase program to extend the expiration date of the program to May 31, 2028.
During the first half of 2026, Farmer Mac repurchased 47,319 shares of Class C non-voting common stock at a cost of approximately $7.1 million. As of June 30, 2026, $30.0 million remain available for repurchase under the program.
Preferred Stock
In May 2026, Farmer Mac issued 4.0 million shares of 6.875 % non-cumulative perpetual Series I preferred stock, par value $25.00 per share. Farmer Mac incurred direct costs of $3.2 million related to the issuance of the Series I preferred stock. The dividend rate on the Series I preferred stock will remain at a non-cumulative, fixed rate of 6.875 % per year, when, as, and if a dividend is declared by the Board of Directors of Farmer Mac, for so long as the Series I preferred stock remains outstanding. The Series I preferred stock has no maturity date, but Farmer Mac has the option to redeem the preferred stock at any time on any dividend payment date on and after July 17, 2031.
Capital Requirements
Farmer Mac is required to comply with the higher of the minimum capital requirement and the risk-based capital requirement. As of both June 30, 2026 and December 31, 2025, the minimum capital requirement was greater than the risk-based capital requirement. Farmer Mac's ability to declare and pay dividends could be restricted if it fails to comply with applicable capital requirements.
As of June 30, 2026, Farmer Mac's minimum capital requirement was $1.1 billion and its core capital level was $1.9 billion, which was $730.7 million above the minimum capital requirement as of that date. As of December 31, 2025, Farmer Mac's minimum capital requirement was $1.0 billion and its core
34
capital level was $1.7 billion, which was $677.7 million above the minimum capital requirement as of that date.
8.FAIR VALUE DISCLOSURES
Fair Value Classification and Transfers
The following tables present information about Farmer Mac's assets and liabilities measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025, respectively, and indicate the fair value hierarchy of the valuation techniques used by Farmer Mac to determine such fair value:
Table 8.1
Assets and Liabilities Measured at Fair Value as of June 30, 2026 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3(1) | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||
AFS: | |||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | $ | $ | |||||||||||||||||||
U.S. Treasuries | |||||||||||||||||||||||
ABS | |||||||||||||||||||||||
| AgVantage | |||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | |||||||||||||||||||||||
Total AFS Investment Securities | |||||||||||||||||||||||
| Financial derivatives | |||||||||||||||||||||||
Other Assets(2) | |||||||||||||||||||||||
| Total Assets at fair value | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Financial derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Total Liabilities at fair value | $ | $ | $ | $ | |||||||||||||||||||
(1) Level 3 assets represent 20 % of total assets and 52 % of financial instruments measured at fair value.
(2) Represents a retained beneficial interest related to transfers of financial assets.
35
Assets and Liabilities Measured at Fair Value as of December 31, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3(1) | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||
AFS: | |||||||||||||||||||||||
Government/GSE guaranteed MBS | $ | $ | $ | $ | |||||||||||||||||||
U.S. Treasuries | |||||||||||||||||||||||
| AgVantage | |||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | |||||||||||||||||||||||
Total AFS Investment Securities | |||||||||||||||||||||||
| Financial derivatives | |||||||||||||||||||||||
Other Assets(2) | |||||||||||||||||||||||
| Total Assets at fair value | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Financial derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Total Liabilities at fair value | $ | $ | $ | $ | |||||||||||||||||||
(1) Level 3 assets represent 19 % of total assets and 49 % of financial instruments measured at fair value.
(2) Represents a retained beneficial interest related to transfers of financial assets.
There were no material assets or liabilities measured at fair value on a non-recurring basis as of June 30, 2026 or December 31, 2025.
Transfers in and/or out of the different levels within the fair value hierarchy are based on the fair values of the assets and liabilities as of the beginning of the reporting period. During the three and six months ended June 30, 2026 and 2025, there were no transfers within the fair value hierarchy.
The following tables present additional information about assets and liabilities measured at fair value on a recurring basis for which Farmer Mac has used significant unobservable inputs to determine fair value. Net transfers in and/or out of Level 3 are based on the fair values of the assets and liabilities as of the beginning of the reporting period. There were no liabilities measured at fair value using significant unobservable inputs during the three and six months ended June 30, 2026 and 2025.
Table 8.2
Level 3 Assets and Liabilities Measured at Fair Value For the Three Months Ended June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | Purchases | Settlements | Allowance for Losses | Realized and unrealized (losses)/gains included in Income | Ending Balance | ||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||||||||||||||||||||
AFS: | |||||||||||||||||||||||||||||||||||||||||
ABS | $ | $ | $ | ( | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
AgVantage | ( | ( | |||||||||||||||||||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | ( | ||||||||||||||||||||||||||||||||||||||||
Total AFS | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Other Assets | ( | ||||||||||||||||||||||||||||||||||||||||
| Total Assets at fair value | $ | $ | $ | ( | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
36
Level 3 Assets and Liabilities Measured at Fair Value For the Three Months Ended June 30, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | Purchases | Settlements | Allowance for Losses | unrealized gains/(losses) included in Income | Ending Balance | ||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||||||||||||||||||||
AFS: | |||||||||||||||||||||||||||||||||||||||||
Auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| AgVantage | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total AFS | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Other Assets | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Total Assets at fair value | $ | $ | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||
Level 3 Assets and Liabilities Measured at Fair Value for the For the Six Months Ended June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | Purchases | Settlements | Allowance for Losses | Realized and unrealized gains included in Income | Ending Balance | ||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||||||||||||||||||||
| AFS: | |||||||||||||||||||||||||||||||||||||||||
| ABS | $ | $ | $ | ( | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
| AgVantage | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | ( | ||||||||||||||||||||||||||||||||||||||||
| Total AFS | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Other Assets | ( | ||||||||||||||||||||||||||||||||||||||||
| Total Assets at fair value | $ | $ | $ | ( | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||
37
Level 3 Assets and Liabilities Measured at Fair Value for the For the Six Months Ended June 30, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | Purchases | Settlements | Allowance for Losses | unrealized gains/(losses) included in Income | Ending Balance | ||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||||||||||||||||||||
| AFS: | |||||||||||||||||||||||||||||||||||||||||
Auction-rate certificates backed by Government guaranteed student loans | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| AgVantage | ( | ( | |||||||||||||||||||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Total AFS | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Other Assets | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Total Assets at fair value | $ | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
The following tables present additional information about the significant unobservable inputs, such as discount rates and constant prepayment rates ("CPR"), used in the fair value measurements categorized in Level 3 of the fair value hierarchy as of June 30, 2026 and December 31, 2025:
Table 8.3
| As of June 30, 2026 | ||||||||||||||||||||||||||
| Financial Instruments | Fair Value | Valuation Technique | Unobservable Input | Range (Weighted-Average) | ||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||
ABS | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
| AgVantage | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
| Interest-Only Farmer Mac Guaranteed Securities | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
| CPR | ||||||||||||||||||||||||||
| Other Assets | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
| CPR | ||||||||||||||||||||||||||
As of December 31, 2025 | ||||||||||||||||||||||||||
| Financial Instruments | Fair Value | Valuation Technique | Unobservable Input | Range (Weighted-Average) | ||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||
| AgVantage | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
| Interest-Only Farmer Mac Guaranteed Securities | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
| CPR | ||||||||||||||||||||||||||
| Other Assets | $ | Discounted cash flow | Discount rate | |||||||||||||||||||||||
| CPR | ||||||||||||||||||||||||||
38
Disclosures on Fair Value of Financial Instruments
The following table sets forth the estimated fair values and carrying values for financial assets, liabilities, and guarantees and commitments as of June 30, 2026 and December 31, 2025:
Table 8.4
| As of June 30, 2026 | |||||||||||||||||||||||||||||
Carrying Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Estimated Fair Value | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Financial Assets: | |||||||||||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Investment securities | |||||||||||||||||||||||||||||
Loans | |||||||||||||||||||||||||||||
Financial derivatives | |||||||||||||||||||||||||||||
| Guarantee and commitment fees receivable | |||||||||||||||||||||||||||||
| Financial liabilities: | |||||||||||||||||||||||||||||
| Notes payable | |||||||||||||||||||||||||||||
| Debt securities of consolidated trusts held by third parties | |||||||||||||||||||||||||||||
| Financial derivatives | |||||||||||||||||||||||||||||
| Guarantee and commitment obligations | |||||||||||||||||||||||||||||
| As of December 31, 2025 | |||||||||||||||||||||||||||||
Carrying Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Estimated Fair Value | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Financial Assets: | |||||||||||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | ||||||||||||||||||||||||||
Investment securities | |||||||||||||||||||||||||||||
Loans | |||||||||||||||||||||||||||||
Financial derivatives | |||||||||||||||||||||||||||||
| Guarantee and commitment fees receivable | |||||||||||||||||||||||||||||
| Financial liabilities: | |||||||||||||||||||||||||||||
| Notes payable | |||||||||||||||||||||||||||||
| Debt securities of consolidated trusts held by third parties | |||||||||||||||||||||||||||||
| Financial derivatives | |||||||||||||||||||||||||||||
| Guarantee and commitment obligations | |||||||||||||||||||||||||||||
39
9.BUSINESS SEGMENT REPORTING
The following table presents Farmer Mac's seven
| Agricultural Finance | Infrastructure Finance | Treasury | ||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Funding | Investments | ||||||||||||||
The Chief Executive Officer serves as the Chief Operating Decision Maker ("CODM"). The CODM reviews segment core earnings to make decisions about allocating resources and to assess the financial performance of the segments. The main difference between core earnings and net income is the exclusion of the effects of fair value fluctuations. These fluctuations are not expected to have a cumulative net impact on Farmer Mac's financial condition or results of operations reported in accordance with GAAP if the related financial instruments are held to maturity, as is expected. Another difference is that core earnings excludes specified infrequent or unusual transactions that are not indicative of future operating results and that may not reflect the trends and economic financial performance of Farmer Mac's core business. The CODM also looks at changes in the segments' on- and off-balance sheet unpaid principal balances to assess the performance of the segments.
40
The following tables present segment core earnings and assets for the three and six months ended June 30, 2026 and 2025.
Table 9.1
| Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | Treasury | |||||||||||||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Funding | Investments | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Interest income | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(Interest expense)/benefit(1) | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(2)(3) | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Net effective spread | |||||||||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(3) | |||||||||||||||||||||||||||||||||||||||||||||||
Other income/(expense) | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Provision for losses | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Operating expenses(1) | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Income tax expense | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Reconciliation to net income: | |||||||||||||||||||||||||||||||||||||||||||||||
Net effects of derivatives and trading securities | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Unallocated (expenses)/income | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Income tax effect related to reconciling items | |||||||||||||||||||||||||||||||||||||||||||||||
Net income | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Total Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet segment assets at principal balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Off-balance sheet assets under management | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Unallocated assets | |||||||||||||||||||||||||||||||||||||||||||||||
Total assets on the Consolidated Balance Sheets | $ | ||||||||||||||||||||||||||||||||||||||||||||||
(1)The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.
(2)Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships.
(3)Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
41
| Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended June 30, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | Treasury | |||||||||||||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Funding | Investments | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Interest income | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Interest expense(1) | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(2)(3) | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
| Net effective spread | |||||||||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Other income | |||||||||||||||||||||||||||||||||||||||||||||||
| Provision for losses | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Operating expenses(1) | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Income tax expense | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Reconciliation to net income: | |||||||||||||||||||||||||||||||||||||||||||||||
Net effects of derivatives and trading securities | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Unallocated (expenses)/income | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Income tax effect related to reconciling items | |||||||||||||||||||||||||||||||||||||||||||||||
Net income | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Total Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet segment assets at principal balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Off-balance sheet assets under management | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Unallocated assets | |||||||||||||||||||||||||||||||||||||||||||||||
Total assets on the Consolidated Balance Sheets | $ | ||||||||||||||||||||||||||||||||||||||||||||||
(1)The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.
(2)Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships.
(3)Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
42
| Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||||||||
For the Six Months Ended June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | Treasury | |||||||||||||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Funding | Investments | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Interest income | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Interest (expense)/benefit(1) | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(2)(3) | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Net effective spread | |||||||||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(3) | |||||||||||||||||||||||||||||||||||||||||||||||
Other income/(expense) | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Provision for losses | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Operating expenses(1) | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Income tax expense | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Reconciliation to net income: | |||||||||||||||||||||||||||||||||||||||||||||||
| Net effects of derivatives and trading securities | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Unallocated (expense)/income | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Income tax effect related to reconciling items | |||||||||||||||||||||||||||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Total Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet segment assets at principal balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Off-balance sheet assets under management | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Unallocated assets | |||||||||||||||||||||||||||||||||||||||||||||||
Total assets on the Consolidated Balance Sheets | $ | ||||||||||||||||||||||||||||||||||||||||||||||
(1)The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.
(2)Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships.
43
| Core Earnings by Business Segment | |||||||||||||||||||||||||||||||||||||||||||||||
For the Six Months Ended June 30, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | Treasury | |||||||||||||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Funding | Investments | Total | ||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Interest income | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Interest expense(1) | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Less: reconciling adjustments(2)(3) | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
| Net effective spread | |||||||||||||||||||||||||||||||||||||||||||||||
Guarantee and commitment fees(3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Other income | |||||||||||||||||||||||||||||||||||||||||||||||
| Provision for losses | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Operating expenses(1) | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Income tax expense | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Segment core earnings | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Reconciliation to net income: | |||||||||||||||||||||||||||||||||||||||||||||||
| Net effects of derivatives and trading securities | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||
Unallocated (expense)/income | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Income tax effect related to reconciling items | |||||||||||||||||||||||||||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Total Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Total on- and off-balance sheet segment assets at principal balance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Off-balance sheet assets under management | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Unallocated assets | |||||||||||||||||||||||||||||||||||||||||||||||
Total assets on the Consolidated Balance Sheets | $ | ||||||||||||||||||||||||||||||||||||||||||||||
(1)The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.
(2)Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships.
10.INCOME TAXES
During the three and six months ended June 30, 2026, Farmer Mac purchased $21.4 million and $66.4 million, respectively, of renewable energy investment tax credits at prices ranging from approximately $0.91 0.93 2.0 million and $6.3 million, respectively. During both the three and six months ended June 30, 2025, Farmer Mac purchased $35.6 0.91 per $1.00 of credit. All of the renewable energy investment tax credits purchased are with projects that have been placed into service. As a result of these purchases, Farmer Mac recognized a tax benefit of $3.2
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Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations
The objective of this section of the report is to provide a discussion and analysis, from management’s perspective, of the material information necessary to assess Farmer Mac's financial condition and results of operations for the quarter ended June 30, 2026. Financial information included in this report is consolidated to include the accounts of Farmer Mac and its two subsidiaries – Farmer Mac Mortgage Securities Corporation and Farmer Mac II LLC. This discussion and analysis of financial condition and results of operations should be read together with: (1) the interim unaudited consolidated financial statements and the related notes that appear elsewhere in this report; and (2) Farmer Mac's Annual Report on Form 10-K for the fiscal year ended December 31, 2025 as filed with the SEC on February 19, 2026 (the "2025 Annual Report").
FORWARD-LOOKING STATEMENTS
In this report, the words "Farmer Mac," "we," "our," and "us" refer to the Federal Agricultural Mortgage Corporation and its subsidiaries unless otherwise stated or unless the context otherwise requires.
Some statements made in this report, such as in the "Management's Discussion and Analysis of Financial Condition and Results of Operations ('MD&A')" section, are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 about management's current expectations for Farmer Mac's future financial results, business prospects, and business developments. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate, or imply future results, performance, or achievements. These statements typically include terms such as "aims," "anticipates," "believes," "continues," "designed," "estimates," "expects," "forecasts," "likely," "intends," "often," "outlook," "plans," "potential," "project," "target," and similar terms, and future or conditional tense verbs like "could," "may," "might," "should," "will," and "would." This report includes forward-looking statements addressing our:
•prospects for earnings;
•prospects for growth in business volume;
•trends in net interest income and net effective spread;
•trends in portfolio credit quality, delinquencies, substandard assets, credit losses, charge offs, and provisions for expected credit losses;
•assessment of economic and market trends;
•trends in expenses;
•trends in investment securities;
•prospects for asset impairments and allowance for losses;
•changes in capital position;
•future dividend payments; and
•other business and financial matters.
Management's expectations for Farmer Mac's future necessarily involve assumptions, estimates, and the evaluation of risks and uncertainties. Various factors or events, both known and unknown, could cause our actual results to differ materially from the expectations as expressed or implied by the forward-looking
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statements, including the factors discussed under "Risk Factors" in Part I, Item 1A of Farmer Mac's 2025 Annual Report as well as uncertainties about:
•the availability to Farmer Mac of debt and equity financing and, if available, the reasonableness of rates and terms;
•legislative, regulatory, or current or future political developments that could affect Farmer Mac, its sources of business, or agricultural or infrastructure industries;
•fluctuations in the fair value of assets held by Farmer Mac and its subsidiaries;
•the level of lender interest in Farmer Mac's products and the secondary market provided by Farmer Mac;
•the general rate of growth in agricultural mortgage and infrastructure indebtedness;
•the effect of economic conditions stemming from disruptive global events or otherwise on agricultural mortgage or infrastructure lending, borrower repayment capacity, or collateral values, including inflation, fluctuations in interest rates, changes in U.S. trade policies (including tariffs and trade restrictions), fluctuations in export demand for U.S. agricultural products and foreign currency exchange rates, supply chain disruptions, increases in input costs, labor availability, and volatility in commodity prices;
•the degree to which Farmer Mac is exposed to interest rate risk resulting from fluctuations in Farmer Mac's borrowing costs relative to market indices;
•developments in the financial markets, including possible investor, analyst, and rating agency reactions to events involving government-sponsored enterprises, including Farmer Mac;
•the effects of the Federal Reserve’s efforts to achieve monetary policy normalization to respond to inflation and employment levels; and
•other factors that could hinder agricultural mortgage lending or borrower repayment capacity, including the effects of severe weather, flooding and drought, or fluctuations in agricultural real estate values.
Considering these potential risks and uncertainties, no undue reliance should be placed on any forward-looking statements expressed in this report. We undertake no obligation to release publicly the results of revisions to any forward-looking statements to reflect new information or any future events or circumstances, except as otherwise required by applicable law. The information in this report is not necessarily indicative of future results.
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Overview
We are driven by our mission to increase the accessibility of financing to provide vital liquidity for American agriculture and rural infrastructure. Our secondary market provides liquidity to the nation's agricultural and rural 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 & 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. We also provide investment opportunities through our debt issuances to entities, such as states, counties, municipalities, pension funds, banks, public trust funds, and credit unions, that may diversify their investment portfolios and provide possibilities to earn a competitive return on their investment dollars.
During second quarter 2026, we:
•provided $4.0 billion in liquidity and lending capacity to lenders serving rural America;
•maintained strong liquidity in our investment portfolio, averaging 282 days of liquidity during 2026, well above the regulatory requirement of a minimum of 90 days of liquidity;
•issued $100 million of 6.875% non-cumulative perpetual Series I preferred stock;
•delivered record net income, contributing to a $41.5 million increase in retained earnings and a capital position $0.7 billion above the minimum regulatory requirement; and
•maintained uninterrupted access to the debt capital markets.
The discussion below of our financial information includes "non-GAAP measures," which are measures of financial performance not presented in accordance with generally accepted accounting principles in the United States ("GAAP"). For more information about the non-GAAP measures we use, see MD&A—Use of Non-GAAP Measures.
Net Income and Core Earnings
The following table presents our net income attributable to common stockholders and core earnings for the periods presented. Core earnings is a non-GAAP measure that differs from net income attributable to common stockholders by excluding the effects of fair value fluctuations and specified infrequent or unusual transactions.
Table 1
| For the Three Months Ended | |||||||||||||||||
| June 30, 2026 | March 31, 2026 | June 30, 2025 | |||||||||||||||
| (in thousands) | |||||||||||||||||
| Net income attributable to common stockholders | $ | 58,877 | $ | 51,832 | $ | 49,170 | |||||||||||
| Core earnings | 58,766 | 51,741 | 47,365 | ||||||||||||||
Net income attributable to common stockholders and core earnings each increased $7.0 million from the prior quarter. The increase in net income attributable to common stockholders was primarily driven by a $16.7 million increase in net interest income ("NII"), while the increase in core earnings was primarily driven by a $15.4 million increase in net effective spread ("NES"). These increases were partially offset by
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a $2.8 million increase in operating expenses, a $2.7 million increase in the provision for credit losses, and a $2.6 million increase in income tax expense during the second quarter of 2026.
Net income attributable to common stockholders increased $9.7 million and core earnings increased $11.4 million year-over-year in the second quarter of 2026. The increase in net income attributable to common stockholders was primarily attributable to a $21.3 million increase in NII, while the increase in core earnings was primarily driven by a $23.5 million increase in NES. These increases were partially offset by a $6.7 million increase in operating expenses and a $4.3 million increase in income tax expense.
For more information about net income attributable to common stockholders, the composition of core earnings, and a reconciliation of net income attributable to common stockholders to core earnings, see MD&A—Results of Operations. For more information about our non-GAAP measures, see MD&A—Use of Non-GAAP Measures.
Net Interest Income and Net Effective Spread
The following table shows our NII and NES in both dollars and percentage yield or spread for the periods presented. We use NES, a non-GAAP measure, as an alternative to NII because management believes it is a useful metric that reflects the economics of the net spread between all the assets we own and all related funding, including any associated derivatives, some of which may not be included in NII.
Table 2
| For the Three Months Ended | |||||||||||||||||
| June 30, 2026 | March 31, 2026 | June 30, 2025 | |||||||||||||||
| (in thousands) | |||||||||||||||||
| Net interest income | $ | 118,075 | $ | 101,396 | $ | 96,797 | |||||||||||
| Net interest yield % | 1.24 | % | 1.13 | % | 1.20 | % | |||||||||||
| Net effective spread | $ | 117,438 | $ | 101,999 | $ | 93,893 | |||||||||||
| Net effective spread % | 1.26 | % | 1.16 | % | 1.19 | % | |||||||||||
The sequential increase of $16.7 million and $15.4 million in NII and NES, respectively, for the second quarter 2026 was primarily attributable to the effects of net volume growth, led by the Farm & Ranch and Renewable Energy portfolios, and collection of $7.4 million of previously unrecognized interest through resolution of a defaulted asset within our Corporate AgFinance segment. The recognition of this income was a nonrecurring event that favorably impacted net interest income during the second quarter 2026.
The year-over-year increase of $21.3 million in NII and $23.5 million in NES were both primarily driven by the effects of net volume growth, led by the Farm & Ranch and Renewable Energy portfolios, and the impact of the $7.4 million collection of default interest recognized in second quarter 2026.
See MD&A—Use of Non-GAAP Measures for more information about our use of NES as a financial measure and Table 9 in MD&A—Results of Operations—Net Interest Income for a reconciliation of NII to NES.
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Business Volume
Our outstanding business volume was $37.2 billion as of June 30, 2026, a net increase of $2.4 billion from March 31, 2026 after taking into account all new business, maturities, sales, and paydowns on existing assets. The net increase was due to new volume during the quarter totaling $4.0 billion, partially offset by scheduled maturities and repayments of $1.6 billion. The net new volume includes increases of $1.8 billion in the Agricultural Finance and $0.6 billion in the Infrastructure Finance lines of business. For more information about our business volume, see MD&A—Results of Operations—Business Volume.
Credit Quality
Throughout this MD&A, credit quality and credit risk disclosures make references to "Agricultural Finance Mortgage Loans" which include on‑balance sheet agricultural mortgage loans and off‑balance sheet exposures, consisting of LTSPCs, unfunded commitments, and Farmer Mac Guaranteed Securities and references to "Infrastructure Finance Loans" include on-balance sheet infrastructure finance loans and off-balance sheet LTSPCs and unfunded commitments.
Our allowance for losses increased $9.4 million from December 31, 2025 to June 30, 2026, primarily due to an $11.4 million provision expense offset by $2.0 million in charge-offs, net of recoveries during the six months ended June 30, 2026. The increase in our allowance for losses was primarily attributable to new volume growth across all of our segments and portfolio credit migration.
For more information about our allowance for losses, see Note 4—Loans to the consolidated financial statements and MD&A—Results of Operations.
The following table presents Agricultural Finance mortgage loans and Infrastructure Finance loans classified as substandard, in dollars and as a percentage of the respective portfolio as of June 30, 2026 and December 31, 2025:
Table 3
| As of June 30, 2026 | As of December 31, 2025 | ||||||||||||||||||||||
| Substandard Assets | % of Portfolio | Substandard Assets | % of Portfolio | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
Agricultural Finance | $ | 576,488 | 3.9 | % | $ | 494,217 | 3.5 | % | |||||||||||||||
Infrastructure Finance | 58,740 | 0.6 | % | 75,546 | 1.0 | % | |||||||||||||||||
| Total | $ | 635,228 | $ | 569,763 | |||||||||||||||||||
Total substandard assets increased $65.5 million from December 31, 2025 to June 30, 2026, with the amount of substandard assets as a percentage of the portfolio increasing from 3.5% at December 31, 2025 to 3.9% at June 30, 2026 for Agricultural Finance loans and decreasing from 1.0% at December 31, 2025 to 0.6% at June 30, 2026 for Infrastructure Finance. The increase in substandard assets for Agricultural Finance loans was primarily driven by credit downgrades while the decrease in substandard assets for Infrastructure Finance was related to a credit upgrade in the Renewable Energy segment.
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The following table presents 90-day delinquency rates for our Agricultural Finance mortgage loans and Infrastructure Finance loans, in dollars and as a percentage of total outstanding business volume as of June 30, 2026 and December 31, 2025:
Table 4
| As of June 30, 2026 | As of December 31, 2025 | ||||||||||||||||||||||
| 90-Day Delinquencies | % of Total Outstanding Volume | 90-Day Delinquencies | % of Total Outstanding Volume | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
Agricultural Finance | $ | 139,128 | 0.37 | % | $ | 132,550 | 0.40 | % | |||||||||||||||
Infrastructure Finance | — | — | % | — | — | % | |||||||||||||||||
| Total | $ | 139,128 | 0.37 | % | $ | 132,550 | 0.40 | % | |||||||||||||||
Across all of our lines of business, 90-day delinquency rates decreased modestly in second quarter 2026 as compared to fourth quarter 2025.
For more details on credit risk management and credit quality indicators, see MD&A—Risk Management—Credit Risk—Loans and Guarantees.
Use of Non-GAAP Measures
We use "non-GAAP measures" in our analysis of financial information. Non-GAAP measures represent measures of financial performance that are not presented in accordance with GAAP. Specifically, we use the following non-GAAP measures: 1) "core earnings," 2) "core earnings per common share," and 3) "net effective spread," in both dollars and percentage yield. In our view, these non-GAAP measures are useful alternative measures in understanding our economic performance, transaction economics, and business trends.
Our non-GAAP financial measures may not be comparable to similarly labeled non-GAAP financial measures disclosed by other companies. Our disclosure of non-GAAP measures is intended to be supplemental in nature and is not meant to be considered in isolation from, as a substitute for, or as more important than, the related financial information prepared in accordance with GAAP.
Core Earnings and Core Earnings Per Common Share
The main difference between core earnings and core earnings per common share ("Core EPS"), which are non-GAAP measures, and net income attributable to common stockholders and earnings per common share ("EPS"), which are GAAP measures, is that those non-GAAP measures exclude the effects of fair value fluctuations. These fluctuations are not expected to have a cumulative net impact on our financial condition or results of operations reported in accordance with GAAP if the related financial instruments are held to maturity, as is expected. Additionally, these two non-GAAP measures exclude specified infrequent or unusual transactions that we believe are not indicative of future operating results and that may not reflect the trends and economic financial performance of our core business. For example, in third quarter 2024, we excluded the loss on the retirement of the Series C Preferred Stock from core earnings and Core EPS, which is consistent with our historical treatment of any losses on the retirement of preferred stock. For a reconciliation of our net income attributable to common stockholders to core earnings and of EPS to Core EPS, see MD&A—Results of Operations.
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Net Effective Spread
We use NES to measure the net spread earned between interest-earning assets and the related net funding costs, including any associated derivatives, whether or not they are designated in a hedge accounting relationship.
NES excludes the following:
•Interest income and interest expense associated with single-class consolidated trusts with beneficial interests owned by third parties and for which we guarantee all classes of securities issued ("single-class consolidated trusts") and reclassifies that activity to guarantee and commitment fees in determining our core earnings. This reclassification reflects our view that the net interest income earned on single-class consolidated trusts is effectively a guarantee fee.
•Fair value changes of financial derivatives and corresponding financial assets or liabilities designated in fair value hedge accounting relationships because they are not expected to have an economic effect on our financial performance, as we expect to hold the financial derivatives and corresponding hedged items to maturity.
•The amortization of premiums and discounts on assets consolidated at fair value.
NES includes the following:
•Income and expense related to the contractual amounts due on financial derivatives that are not designated in hedge accounting relationships ("undesignated financial derivatives"). For undesignated financial derivatives, we record the income or expense related to the accrual of the contractual amounts due in "Gains/(losses) on financial derivatives" on the Consolidated Statements of Operations.
•The net effects of terminations or net settlements on undesignated financial derivatives, which consist of: (1) the net effects of cash settlements on agency forward contracts on the debt of other GSEs and U.S. Treasury security futures that we use as short-term economic hedges on the issuance of debt; and (2) the net effects of initial cash payments that we receive upon the inception of certain swaps. For GAAP purposes, realized gains or losses on settlements of these contracts are reported in the Consolidated Statements of Operations in the period in which they occur. For NES, these realized gains or losses are deferred and amortized as net yield adjustments over the term of the related debt, which generally ranges from 3 to 15 years.
For a reconciliation of NII to NES, see Table 9 in MD&A—Results of Operations—Net Interest Income.
Results of Operations
Reconciliations of net income attributable to common stockholders and EPS to core earnings and Core EPS are presented in the following tables along with information about the composition of core earnings:
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Table 5
| Reconciliation of Net Income Attributable to Common Stockholders to Core Earnings | |||||||||||
| For the Three Months Ended | |||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||
| (in thousands, except per share amounts) | |||||||||||
| Net income attributable to common stockholders | $ | 58,877 | $ | 49,170 | |||||||
| Less reconciling items: | |||||||||||
| Gains/(losses) on undesignated financial derivatives due to fair value changes (see Table 11) | 184 | (639) | |||||||||
| Gains on hedging activities due to fair value changes | 889 | 2,709 | |||||||||
| Unrealized gains/(losses) on trading securities | 59 | (65) | |||||||||
Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value(1) | 26 | 25 | |||||||||
| Net effects of terminations or net settlements on financial derivatives | (1,017) | 255 | |||||||||
| Income tax effect related to reconciling items | (30) | (480) | |||||||||
| Sub-total | 111 | 1,805 | |||||||||
| Core earnings | $ | 58,766 | $ | 47,365 | |||||||
| Composition of Core Earnings: | |||||||||||
| Revenues: | |||||||||||
Net effective spread(2) | $ | 117,438 | $ | 93,893 | |||||||
Guarantee and commitment fees(3) | 7,044 | 5,874 | |||||||||
Other(4) | 742 | 742 | |||||||||
| Total revenues | 125,224 | 100,509 | |||||||||
| Credit related expense (GAAP): | |||||||||||
Provision for losses | 7,017 | 7,713 | |||||||||
Other credit related expense/(income) | 352 | 160 | |||||||||
Total credit related expense | 7,369 | 7,873 | |||||||||
| Operating expenses (GAAP): | |||||||||||
| Compensation and employee benefits | 23,706 | 17,631 | |||||||||
| General and administrative | 11,591 | 10,859 | |||||||||
| Regulatory fees | 862 | 1,000 | |||||||||
| Total operating expenses | 36,159 | 29,490 | |||||||||
| Net earnings | 81,696 | 63,146 | |||||||||
Income tax expense(5) | 14,856 | 10,114 | |||||||||
| Preferred stock dividends (GAAP) | 8,074 | 5,667 | |||||||||
| Core earnings | $ | 58,766 | $ | 47,365 | |||||||
Core EPS: | |||||||||||
| Basic | $ | 5.42 | $ | 4.33 | |||||||
| Diluted | $ | 5.40 | $ | 4.32 | |||||||
| Weighted-average shares: | |||||||||||
| Basic | 10,849 | 10,933 | |||||||||
| Diluted | 10,882 | 10,963 | |||||||||
(1)Reflects the amortization recorded during the reporting period on those assets for which the premium, discount, or deferred gain was a result of consolidation accounting rather than a cash transaction.
(2)NES is a non-GAAP measure. See MD&A—Use of Non-GAAP Measures—Net Effective Spread for more information and Table 9 for a reconciliation of NII to NES.
(3)Includes NII of $1.0 million and $1.0 million for the three months ended June 30, 2026 and 2025, respectively, related to consolidated trusts owned by third parties reclassified from net interest income to guarantee and commitment fees.
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(4)Reflects reconciling adjustments for the reclassification to exclude expenses related to undesignated financial derivatives and terminations or net settlements on financial derivatives, and reconciling adjustments to exclude fair value adjustments on financial derivatives and trading assets and the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.
(5)Includes the tax impact of non-GAAP reconciling items between net income attributable to common stockholders and core earnings.
| Reconciliation of Net Income Attributable to Common Stockholders to Core Earnings | |||||||||||
| For the Six Months Ended | |||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||
| (in thousands, except per share amounts) | |||||||||||
| Net income attributable to common stockholders | $ | 110,709 | $ | 93,155 | |||||||
| Less reconciling items: | |||||||||||
Losses on undesignated financial derivatives due to fair value changes (see Table 11) | (495) | (3,212) | |||||||||
| Gains on hedging activities due to fair value changes | 1,251 | 3,808 | |||||||||
| Unrealized gains/(losses) on trading securities | 112 | (56) | |||||||||
Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value(1) | 70 | 53 | |||||||||
| Net effects of terminations or net settlements on financial derivatives | (682) | (815) | |||||||||
| Income tax effect related to reconciling items | (54) | 46 | |||||||||
| Sub-total | 202 | (176) | |||||||||
| Core earnings | $ | 110,507 | $ | 93,331 | |||||||
| Composition of Core Earnings: | |||||||||||
| Revenues: | |||||||||||
Net effective spread(2) | $ | 219,437 | $ | 183,883 | |||||||
Guarantee and commitment fees(3) | 13,759 | 11,362 | |||||||||
Other(4) | 1,927 | 2,057 | |||||||||
| Total revenues | 235,123 | 197,302 | |||||||||
| Credit related expense (GAAP): | |||||||||||
Provision for losses | 11,325 | 9,397 | |||||||||
Other credit related expense/(income) | 1,241 | 127 | |||||||||
Total credit related expense | 12,566 | 9,524 | |||||||||
| Operating expenses (GAAP): | |||||||||||
| Compensation and employee benefits | 44,963 | 35,383 | |||||||||
| General and administrative | 22,853 | 21,617 | |||||||||
| Regulatory fees | 1,725 | 2,000 | |||||||||
| Total operating expenses | 69,541 | 59,000 | |||||||||
| Net earnings | 153,016 | 128,778 | |||||||||
Income tax expense(5) | 27,144 | 24,114 | |||||||||
| Preferred stock dividends (GAAP) | 15,365 | 11,333 | |||||||||
| Core earnings | $ | 110,507 | $ | 93,331 | |||||||
Core EPS: | |||||||||||
| Basic | $ | 10.19 | $ | 8.55 | |||||||
| Diluted | $ | 10.14 | $ | 8.51 | |||||||
| Weighted-average shares: | |||||||||||
| Basic | 10,847 | 10,915 | |||||||||
| Diluted | 10,902 | 10,973 | |||||||||
(1)Reflects the amortization recorded during the reporting period on those assets for which the premium, discount, or deferred gain was a result of consolidation accounting rather than a cash transaction.
(2)NES is a non-GAAP measure. See MD&A—Use of Non-GAAP Measures—Net Effective Spread for more information and Table 9 for a reconciliation of NII to NES.
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(3)Includes NII of $2.0 million and $2.0 million for the six months ended June 30, 2026 and 2025, respectively, related to consolidated trusts owned by third parties reclassified from net interest income to guarantee and commitment fees.
(4)Reflects reconciling adjustments for the reclassification to exclude expenses related to undesignated financial derivatives and terminations or net settlements on financial derivatives, and reconciling adjustments to exclude fair value adjustments on financial derivatives and trading assets and the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.
(5)Includes the tax impact of non-GAAP reconciling items between net income attributable to common stockholders and core earnings.
Table 6
Reconciliation of GAAP Basic EPS to Core Earnings - Basic EPS | |||||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | ||||||||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||||||||||
| GAAP - Basic EPS | $ | 5.43 | $ | 4.50 | $ | 10.21 | $ | 8.53 | |||||||||||||||
| Less reconciling items: | |||||||||||||||||||||||
| Gains/(losses) on undesignated financial derivatives due to fair value changes (see Table 11) | 0.02 | (0.06) | (0.05) | (0.29) | |||||||||||||||||||
Gains on hedging activities due to fair value changes | 0.07 | 0.25 | 0.12 | 0.35 | |||||||||||||||||||
| Unrealized gains/(losses) on trading securities | 0.01 | (0.01) | 0.01 | (0.01) | |||||||||||||||||||
| Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value | — | — | 0.01 | 0.01 | |||||||||||||||||||
| Net effects of terminations or net settlements on financial derivatives | (0.09) | 0.03 | (0.06) | (0.08) | |||||||||||||||||||
| Income tax effect related to reconciling items | — | (0.04) | (0.01) | — | |||||||||||||||||||
| Sub-total | 0.01 | 0.17 | 0.02 | (0.02) | |||||||||||||||||||
| Core Earnings - Basic EPS | $ | 5.42 | $ | 4.33 | $ | 10.19 | $ | 8.55 | |||||||||||||||
| Shares used in per share calculation (GAAP and Core Earnings) | 10,849 | 10,933 | 10,847 | 10,915 | |||||||||||||||||||
Reconciliation of GAAP Diluted EPS to Core Earnings - Diluted EPS | |||||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | ||||||||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||||||||||
| GAAP - Diluted EPS | $ | 5.41 | $ | 4.48 | $ | 10.15 | $ | 8.49 | |||||||||||||||
| Less reconciling items: | |||||||||||||||||||||||
| Gains/(losses) on undesignated financial derivatives due to fair value changes (see Table 11) | 0.02 | (0.06) | (0.05) | (0.29) | |||||||||||||||||||
Gains on hedging activities due to fair value changes | 0.07 | 0.25 | 0.11 | 0.35 | |||||||||||||||||||
| Unrealized gains/(losses) on trading securities | 0.01 | (0.01) | 0.01 | (0.01) | |||||||||||||||||||
| Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value | — | — | 0.01 | — | |||||||||||||||||||
| Net effects of terminations or net settlements on financial derivatives | (0.09) | 0.02 | (0.06) | (0.07) | |||||||||||||||||||
| Income tax effect related to reconciling items | — | (0.04) | (0.01) | — | |||||||||||||||||||
| Sub-total | 0.01 | 0.16 | 0.01 | (0.02) | |||||||||||||||||||
| Core Earnings - Diluted EPS | $ | 5.40 | $ | 4.32 | $ | 10.14 | $ | 8.51 | |||||||||||||||
| Shares used in per share calculation (GAAP and Core Earnings) | 10,882 | 10,963 | 10,902 | 10,973 | |||||||||||||||||||
The following sections provide more detail about specific components of our results of operations.
Net Interest Income. The following tables provide information about interest-earning assets and funding, composition of changes in NII due to rate and volume, and a reconciliation of NII to NES for the three and six months ended June 30, 2026 and 2025. See MD&A—Use of Non-GAAP Measures—Net Effective Spread for more information about differences between NII and NES. Our interest-earning assets include:
54
•"Liquidity investments", which are defined as cash, cash equivalents (including U.S. Treasury securities, operational deposits, and other short-term money market instruments), and other investment securities (including securities guaranteed by the U.S. Government and its agencies or by GSEs and asset-backed securities) that can be drawn upon for liquidity needs. For additional details regarding our liquidity investments, see MD&A—Liquidity and Capital Resources.
•"Program Assets" are those assets that fulfill our mission to increase the accessibility of financing to provide vital liquidity for American agriculture and rural infrastructure. Program Assets include but are not limited to Eligible Loans, Farmer Mac Guaranteed Securities, AgVantage Securities, USDA Securities, and other asset‑backed securities.
Table 7
| For the Three Months Ended | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||
| Average Balance | Income/ Expense | Average Rate | Average Balance | Income/ Expense | Average Rate | ||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||
| Interest-earning assets: | |||||||||||||||||||||||||||||||||||
Liquidity investments | $ | 8,292,993 | $ | 85,605 | 4.13 | % | $ | 7,557,352 | $ | 88,985 | 4.71 | % | |||||||||||||||||||||||
Program Assets | 29,750,999 | 364,655 | 4.90 | % | 24,828,604 | 310,037 | 4.99 | % | |||||||||||||||||||||||||||
| Total interest-earning assets | 38,043,992 | 450,260 | 4.73 | % | 32,385,956 | 399,022 | 4.93 | % | |||||||||||||||||||||||||||
| Funding: | |||||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | 35,653,064 | 332,185 | 3.72 | % | 30,307,480 | 302,225 | 3.99 | % | |||||||||||||||||||||||||||
| Net non-interest-bearing funding | 2,390,928 | — | 2,078,476 | — | |||||||||||||||||||||||||||||||
| Total funding | 38,043,992 | 332,185 | 3.49 | % | 32,385,956 | 302,225 | 3.73 | % | |||||||||||||||||||||||||||
Net interest income/yield | $ | 38,043,992 | $ | 118,075 | 1.24 | % | $ | 32,385,956 | $ | 96,797 | 1.20 | % | |||||||||||||||||||||||
| For the Six Months Ended | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||
| Average Balance | Income/ Expense | Average Rate | Average Balance | Income/ Expense | Average Rate | ||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||
| Interest-earning assets: | |||||||||||||||||||||||||||||||||||
Liquidity investments | $ | 8,206,291 | $ | 169,699 | 4.14 | % | $ | 7,377,693 | $ | 172,293 | 4.67 | % | |||||||||||||||||||||||
Program Assets | 28,841,080 | 696,522 | 4.83 | % | 24,670,846 | 608,143 | 4.93 | % | |||||||||||||||||||||||||||
| Total interest-earning assets | 37,047,371 | 866,221 | 4.68 | % | 32,048,539 | 780,436 | 4.87 | % | |||||||||||||||||||||||||||
| Funding: | |||||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | 34,745,467 | 646,750 | 3.72 | % | 29,932,098 | 592,700 | 3.96 | % | |||||||||||||||||||||||||||
| Net non-interest-bearing funding | 2,301,904 | — | 2,116,441 | — | |||||||||||||||||||||||||||||||
| Total funding | 37,047,371 | 646,750 | 3.49 | % | 32,048,539 | 592,700 | 3.70 | % | |||||||||||||||||||||||||||
Net interest income/yield | $ | 37,047,371 | $ | 219,471 | 1.18 | % | $ | 32,048,539 | $ | 187,736 | 1.17 | % | |||||||||||||||||||||||
55
Table 8
For the Six Months Ended June 30, 2026 Compared to Same Period in 2025 | |||||||||||||||||
| Increase/(Decrease) Due to | |||||||||||||||||
| Rate | Volume | Total | |||||||||||||||
| (in thousands) | |||||||||||||||||
| Income from interest-earning assets: | |||||||||||||||||
Liquidity investments | $ | (20,847) | $ | 18,253 | $ | (2,594) | |||||||||||
Program Assets | (12,556) | 100,935 | 88,379 | ||||||||||||||
| Total | (33,403) | 119,188 | 85,785 | ||||||||||||||
| Expense from other interest-bearing liabilities | (37,098) | 91,148 | 54,050 | ||||||||||||||
Change in net interest income | $ | 3,695 | $ | 28,040 | $ | 31,735 | |||||||||||
Table 9
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||
| Dollars | Yield | Dollars | Yield | Dollars | Yield | Dollars | Yield | ||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
Net interest income | $ | 118,075 | 1.24 | % | $ | 96,797 | 1.20 | % | $ | 219,471 | 1.18 | % | $ | 187,736 | 1.17 | % | |||||||||||||||||||||||||||||||
Net effects of single-class consolidated trusts | (1,023) | 0.02 | % | (987) | 0.02 | % | (1,953) | 0.02 | % | (1,998) | 0.02 | % | |||||||||||||||||||||||||||||||||||
| Expense related to undesignated financial derivatives | 556 | — | % | (208) | — | % | 1,525 | 0.01 | % | 110 | — | % | |||||||||||||||||||||||||||||||||||
| Amortization of premiums/discounts on assets consolidated at fair value | (24) | — | % | (22) | — | % | (65) | — | % | (47) | — | % | |||||||||||||||||||||||||||||||||||
| Amortization of losses due to terminations or net settlements on financial derivatives | 743 | 0.01 | % | 1,022 | 0.01 | % | 1,710 | 0.01 | % | 1,890 | 0.01 | % | |||||||||||||||||||||||||||||||||||
| Fair value changes on fair value hedge relationships | (889) | (0.01) | % | (2,709) | (0.04) | % | (1,251) | (0.01) | % | (3,808) | (0.02) | % | |||||||||||||||||||||||||||||||||||
| Net effective spread | $ | 117,438 | 1.26 | % | $ | 93,893 | 1.19 | % | $ | 219,437 | 1.21 | % | $ | 183,883 | 1.18 | % | |||||||||||||||||||||||||||||||
The $21.3 million and $23.5 million year-over-year increase in NII and NES, respectively, for the second quarter 2026 compared to the second quarter 2025 were largely driven by net new business volume in Renewable Energy and Farm & Ranch, in addition to the impact of collecting $7.4 million of default interest recognized in second quarter 2026.
The $31.7 million and $35.6 million year-over-year increase in NII and NES, respectively, for the six months ended June 30, 2026 compared to the same period in the prior year, were largely driven by net new business volume in Renewable Energy and Farm & Ranch, in addition to the impact of collecting $7.4 million of default interest recognized in second quarter 2026
See Note 9—Business Segments to the consolidated financial statements for more information about NII and NES from our business segments. See MD&A—Supplemental Information for quarterly NES by line of business.
56
Provision for Allowance for Losses. The following table summarizes the components of our total allowance for losses for the three and six months ended June 30, 2026 and 2025:
Table 10
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | ||||||||||||||||||||
Allowance for Losses | Allowance for Losses | ||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Beginning Balance | $ | 40,132 | $ | 25,437 | $ | 37,999 | $ | 23,670 | |||||||||||||||
Provision for losses | 7,017 | 7,713 | 11,325 | 9,397 | |||||||||||||||||||
Charge-off | (42) | (2,840) | (2,217) | (2,840) | |||||||||||||||||||
| Recovery | 246 | 40 | 246 | 123 | |||||||||||||||||||
| Ending Balance | $ | 47,353 | $ | 30,350 | $ | 47,353 | $ | 30,350 | |||||||||||||||
During the second quarter 2026, we recorded a $7.0 million net provision to the allowance, which is attributable to new volume growth and portfolio credit migration. For additional information, see Note 4—Loans to the consolidated financial statements and MD&A—Risk Management—Credit Risk—Loans and Guarantees.
Gains/(losses) on financial derivatives. The components of gains and losses on financial derivatives for the three and six months ended June 30, 2026 and 2025 are summarized in the following table:
Table 11
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | $ | % | June 30, 2026 | June 30, 2025 | $ | % | ||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| Gains/(losses) on undesignated financial derivatives due to fair value changes | $ | 184 | $ | (639) | $ | 823 | (129) | % | $ | (495) | $ | (3,212) | $ | 2,717 | (85) | % | |||||||||||||||||||||||||||||||
| Accrual of contractual payments | 556 | (208) | 764 | (367) | % | 1,525 | 110 | 1,415 | 1,286 | % | |||||||||||||||||||||||||||||||||||||
| (Losses)/gains due to terminations or net settlements | (516) | 927 | (1,443) | (156) | % | 334 | 546 | (212) | (39) | % | |||||||||||||||||||||||||||||||||||||
Gains/(losses) on financial derivatives | 224 | $ | 80 | $ | 144 | 180 | % | $ | 1,364 | $ | (2,556) | $ | 3,920 | (153) | % | ||||||||||||||||||||||||||||||||
These changes in fair value are primarily the result of fluctuations in interest rates. Payments or receipts to terminate undesignated derivative positions or net cash settled forward sales contracts on the debt of other GSEs and undesignated U.S. Treasury security futures and initial cash payments received upon the inception of certain undesignated swaps are included in "(Losses)/gains due to terminations or net settlements" in the table above. See Note 3—Financial Derivatives to the consolidated financial statements for more information about our financial derivatives.
57
Operating Expenses. The following table summarizes components of operating expenses for the three and six months ended June 30, 2026 and 2025:
Table 12
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | $ | % | June 30, 2026 | June 30, 2025 | $ | % | ||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| Compensation and employee benefits | $ | 23,706 | $ | 17,631 | $ | 6,075 | 34 | % | $ | 44,963 | $ | 35,383 | $ | 9,580 | 27 | % | |||||||||||||||||||||||||||||||
| General and administrative | 11,591 | 10,859 | 732 | 7 | % | 22,853 | 21,617 | 1,236 | 6 | % | |||||||||||||||||||||||||||||||||||||
| Regulatory fees | 862 | 1,000 | (138) | (14) | % | 1,725 | 2,000 | (275) | (14) | % | |||||||||||||||||||||||||||||||||||||
| Total Operating Expenses | $ | 36,159 | $ | 29,490 | $ | 6,669 | 23 | % | $ | 69,541 | $ | 59,000 | $ | 10,541 | 18 | % | |||||||||||||||||||||||||||||||
The year-over-year increase in compensation and employee benefits expenses for the three and six months ended June 30, 2026 was driven by increased headcount, higher bonus accruals associated with strong financial performance, and the timing of compensation expense recognition within 2026.
The year-over-year increase in general and administrative expenses for the three and six months ended June 30, 2026 was primarily attributable to higher consulting and licensing costs.
Income Tax Expense. The following table presents income tax expense and the effective income tax rate for the three and six months ended June 30, 2026 and 2025:
Table 13
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | $ | % | June 30, 2026 | June 30, 2025 | $ | % | ||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| Income tax expense | $ | 14,885 | $ | 10,594 | $ | 4,291 | 41 | % | $ | 27,197 | $ | 24,068 | $ | 3,129 | 13 | % | |||||||||||||||||||||||||||||||
| Effective tax rate | 18.2 | % | 16.2 | % | 2.0 | % | 17.7 | % | 18.7 | % | (1.0) | % | |||||||||||||||||||||||||||||||||||
The year-over-year increase in income tax expense for the three and six months ended June 30, 2026 was primarily attributable to increased taxable income in 2026. The changes in our effective tax rate are impacted by the volume of purchases of renewable energy investment tax credits. During the three and six months ended June 30, 2026, we purchased $21.4 million and $66.4 million, respectively, of tax credits at prices ranging from approximately $0.91 to $0.93 per $1.00 of credit, resulting in a benefit of $2.0 million and $6.3 million, respectively. During both the three and six months ended June 30, 2025, we purchased $35.6 million in renewable energy investment tax credits at prices of approximately $0.91 per $1.00 of credit. All of the renewable energy investment tax credits purchased are with projects that have been placed into service. As a result of these purchases, we recognized a tax benefit of $3.2 million for both the three and six months ended June 30, 2025.
58
Business Volume. The following table presents our outstanding volume in each line of business as of the dates indicated:
Table 14
| Outstanding Business Volume | ||||||||||||||
As of June 30, 2026 | As of December 31, 2025 | |||||||||||||
| (in thousands) | ||||||||||||||
| Agricultural Finance: | ||||||||||||||
| Farm & Ranch: | ||||||||||||||
Loans and other securities | $ | 9,360,003 | $ | 8,492,788 | ||||||||||
AgVantage Securities | 5,740,000 | 4,270,000 | ||||||||||||
| USDA Securities | 2,530,360 | 2,443,432 | ||||||||||||
Unfunded commitments & guarantees | 4,003,709 | 3,977,136 | ||||||||||||
| Loans serviced for others | 353,750 | 381,560 | ||||||||||||
| Total Farm & Ranch | $ | 21,987,822 | $ | 19,564,916 | ||||||||||
| Corporate AgFinance: | ||||||||||||||
| Loans and other securities | $ | 1,512,959 | $ | 1,460,691 | ||||||||||
AgVantage Securities | 303,613 | 190,977 | ||||||||||||
| Unfunded commitments & guarantees | 266,190 | 298,868 | ||||||||||||
| Total Corporate AgFinance | $ | 2,082,762 | $ | 1,950,536 | ||||||||||
| Total Agricultural Finance | $ | 24,070,584 | $ | 21,515,452 | ||||||||||
| Infrastructure Finance: | ||||||||||||||
| Power & Utilities: | ||||||||||||||
| Loans and other securities | $ | 4,026,622 | $ | 3,548,523 | ||||||||||
AgVantage Securities | 3,905,103 | 3,967,154 | ||||||||||||
| Unfunded commitments & guarantees | 334,914 | 344,945 | ||||||||||||
Total Power & Utilities | $ | 8,266,639 | $ | 7,860,622 | ||||||||||
| Broadband Infrastructure: | ||||||||||||||
| Loans and other securities | $ | 1,227,227 | $ | 1,009,890 | ||||||||||
| Unfunded commitments & guarantees | 624,675 | 522,316 | ||||||||||||
| Total Broadband Infrastructure | $ | 1,851,902 | $ | 1,532,206 | ||||||||||
| Renewable Energy: | ||||||||||||||
| Loans and other securities | $ | 2,565,023 | $ | 2,202,668 | ||||||||||
| Unfunded commitments & guarantees | 442,990 | 240,621 | ||||||||||||
| Total Renewable Energy | $ | 3,008,013 | $ | 2,443,289 | ||||||||||
Total Infrastructure Finance | $ | 13,126,554 | $ | 11,836,117 | ||||||||||
| Total | $ | 37,197,138 | $ | 33,351,569 | ||||||||||
59
The following table presents the net growth or decrease in our lines of business for the three and six months ended June 30, 2026 and 2025:
Table 15
| Net New Business Volume | ||||||||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||||||||||||
| Net Growth/(Decrease) | Net Growth/(Decrease) | Net Growth/(Decrease) | Net Growth/(Decrease) | |||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||
| Agricultural Finance: | ||||||||||||||||||||||||||
| Farm & Ranch: | ||||||||||||||||||||||||||
Loans and other securities | $ | 483,352 | $ | 398,941 | $ | 867,215 | $ | 452,500 | ||||||||||||||||||
AgVantage Securities | 1,145,000 | (230,000) | 1,470,000 | (735,000) | ||||||||||||||||||||||
| USDA Securities | 47,126 | 49,790 | 86,928 | 56,224 | ||||||||||||||||||||||
Unfunded commitments & guarantees | 86,821 | (25,952) | 26,573 | (78,165) | ||||||||||||||||||||||
| Loans serviced for others | (14,675) | (69,389) | (27,810) | (84,622) | ||||||||||||||||||||||
| Total Farm & Ranch | $ | 1,747,624 | $ | 123,390 | $ | 2,422,906 | $ | (389,063) | ||||||||||||||||||
| Corporate AgFinance: | ||||||||||||||||||||||||||
| Loans and other securities | $ | 10,188 | $ | 79,394 | $ | 52,268 | $ | 68,922 | ||||||||||||||||||
AgVantage Securities | 22,936 | (7,790) | 112,636 | (20,359) | ||||||||||||||||||||||
| Unfunded commitments & guarantees | (2,671) | (7,444) | (32,678) | 17,255 | ||||||||||||||||||||||
| Total Corporate AgFinance | $ | 30,453 | $ | 64,160 | $ | 132,226 | $ | 65,818 | ||||||||||||||||||
| Total Agricultural Finance | $ | 1,778,077 | $ | 187,550 | $ | 2,555,132 | $ | (323,245) | ||||||||||||||||||
| Infrastructure Finance: | ||||||||||||||||||||||||||
| Power & Utilities: | ||||||||||||||||||||||||||
| Loans and other securities | $ | 318,188 | $ | 142,321 | $ | 478,099 | $ | 276,220 | ||||||||||||||||||
AgVantage Securities | (21,284) | (19,700) | (62,051) | 255,706 | ||||||||||||||||||||||
| Unfunded commitments & guarantees | (5,897) | (10,233) | (10,031) | (40,938) | ||||||||||||||||||||||
Total Power & Utilities | $ | 291,007 | $ | 112,388 | $ | 406,017 | $ | 490,988 | ||||||||||||||||||
| Broadband Infrastructure: | ||||||||||||||||||||||||||
| Loans and other securities | $ | 122,685 | $ | 90,912 | $ | 217,337 | $ | 126,541 | ||||||||||||||||||
| Unfunded commitments & guarantees | 39,069 | 108,694 | 102,359 | 245,434 | ||||||||||||||||||||||
| Total Broadband Infrastructure | $ | 161,754 | $ | 199,606 | $ | 319,696 | $ | 371,975 | ||||||||||||||||||
| Renewable Energy: | ||||||||||||||||||||||||||
| Loans and other securities | $ | 98,984 | $ | 142,433 | $ | 362,355 | $ | 307,412 | ||||||||||||||||||
| Unfunded commitments & guarantees | 21,262 | 189,939 | 202,369 | 217,099 | ||||||||||||||||||||||
| Total Renewable Energy | $ | 120,246 | $ | 332,372 | $ | 564,724 | $ | 524,511 | ||||||||||||||||||
Total Infrastructure Finance | $ | 573,007 | $ | 644,366 | $ | 1,290,437 | $ | 1,387,474 | ||||||||||||||||||
| Total | $ | 2,351,084 | $ | 831,916 | $ | 3,845,569 | $ | 1,064,229 | ||||||||||||||||||
Our outstanding business volume was $37.2 billion as of June 30, 2026, a net increase of $2.4 billion from March 31, 2026.
The increase in outstanding business volume during the second quarter of 2026, was attributable to a $1.8 billion increase in the Agricultural Finance portfolio and a $0.6 billion increase in the Infrastructure Finance portfolio.
60
The increase in the Agricultural Finance portfolio during the second quarter of 2026 primarily consisted of a $1.7 billion increase in Farm & Ranch, largely due to net growth in AgVantage Securities and Loans and other securities. Volume in AgVantage Securities across both Farm & Ranch and Corporate AgFinance increased by $1.2 billion reflecting $1.5 billion in purchases, partially offset by $0.4 billion in repayment activity.
The $0.6 billion increase in the Infrastructure Finance portfolio was comprised of a $0.3 billion increase in Power & Utilities, a $0.2 billion increase in Broadband Infrastructure, and a $0.1 billion increase in Renewable Energy. The increase in Power & Utilities was largely attributable to the purchase of a $197.3 million pool of loans in that portfolio in June 2026.
The following table summarizes by maturity date the scheduled principal amortization of loans held, loans underlying off-balance sheet Farmer Mac Guaranteed Securities (excluding AgVantage Securities) and LTSPCs, USDA Securities, and Farmer Mac Guaranteed USDA Securities as of June 30, 2026:
Table 16
Schedule of Principal Amortization as of June 30, 2026 | |||||||||||||||||||||||
| Loans | Loans Underlying Off-Balance Sheet Farmer Mac Guaranteed Securities and LTSPCs | USDA Securities and Farmer Mac Guaranteed USDA Securities | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
2026 | $ | 555,574 | $ | 270,584 | $ | 69,020 | $ | 895,178 | |||||||||||||||
2027 | 1,142,504 | 675,510 | 125,328 | 1,943,342 | |||||||||||||||||||
2028 | 1,404,357 | 593,179 | 122,508 | 2,120,044 | |||||||||||||||||||
2029 | 1,473,418 | 643,440 | 124,753 | 2,241,611 | |||||||||||||||||||
2030 | 1,561,883 | 446,782 | 128,617 | 2,137,282 | |||||||||||||||||||
| Thereafter | 12,481,359 | 2,874,392 | 2,128,724 | 17,484,475 | |||||||||||||||||||
| Total | $ | 18,619,095 | $ | 5,503,887 | $ | 2,698,950 | $ | 26,821,932 | |||||||||||||||
Of the $37.2 billion outstanding business volume as of June 30, 2026, $9.9 billion were AgVantage Securities included in the Agricultural Finance and Infrastructure Finance lines of business. Unlike business volume from our other products, most AgVantage Securities do not require periodic payments of principal based on amortization schedules and instead have fixed maturity dates when the secured general obligation is due. Changes in periodic AgVantage Securities volume are primarily driven by the larger transaction size typical for that product, scheduled maturity amounts for a particular period, the liquidity needs of our AgVantage counterparties, and changes in the pricing and availability of wholesale funding from other sources. Based on these factors, we expect business volumes in AgVantage Securities to continue to fluctuate. The following table summarizes by maturity date the outstanding principal amount of AgVantage Securities as of June 30, 2026:
61
Table 17
| AgVantage Security Balances by Year of Maturity | |||||
| As of | |||||
| June 30, 2026 | |||||
| (in thousands) | |||||
2026 | $ | 612,169 | |||
2027 | 1,179,558 | ||||
2028 | 1,073,205 | ||||
2029 | 1,446,059 | ||||
2030 | 2,001,626 | ||||
Thereafter(1) | 3,636,099 | ||||
| Total | $ | 9,948,716 | |||
(1)Includes various maturities ranging from 2031 to 2055.
The weighted-average remaining maturity of the outstanding AgVantage Securities shown in the table above was 5.7 years as of June 30, 2026.
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Outlook
Business Outlook
Products and Portfolio
We play a vital role in serving rural America by providing secondary market liquidity, capital, and risk management tools that expand access to financing for American agriculture and rural infrastructure. Our growth trajectory is closely tied to the capital and liquidity needs of the lending institutions that serve agriculture and infrastructure businesses and the overall financial health of borrowers in these sectors.
Several factors continue to influence our business volume growth dynamics. Because the Farm & Ranch portfolio contains a significant share of legacy low‑rate loans, refinance incentives remain muted, keeping prepayment rates at or below historical norms. Also, a tightening agricultural economy is creating the need for more liquidity and working capital for borrowers managing through this agricultural cycle. The net effect of these forces contributed to strong Farm & Ranch loan purchase portfolio growth during second quarter of 2026 and we anticipate this growth to persist throughout the rest of 2026. Opportunities for future business volume growth include our potential role in alleviating liquidity, capital, and return-on-equity challenges faced by lenders. In 2026, there has been an increase in Farm & Ranch business volume from capital-constrained lending institutions, highlighting the value our secondary market services bring to the industry. We experienced an increase in wholesale finance volume during second quarter of 2026, driven by financings drawn from numerous AgVantage facilities, including a large issuance from a facility put in place in late 2025 with a new counterparty. Future wholesale finance growth will likely be influenced by market interest rates and credit spreads, overall economic conditions and loan growth opportunities, and the relative value of our product versus the broader market. Continued strong interest in data centers, broadband expansion, and constructing and completing renewable energy projects before the sunset of tax credits, along with the overall need for energy generation and transmission capacity for rural America, provided significant opportunities for Infrastructure Finance during second quarter of 2026. We expect these opportunities to persist for the remainder of the year.
Operations
We anticipate ongoing increases in operating expenses over the next several years, aligned with our planned expansion of investments in technology, business infrastructure, and human capital. These investments are designed to enhance capacity and efficiency in support of market growth opportunities and long-term strategic objectives. By investing in infrastructure and business platforms, we aim to scale more efficiently in tandem with future portfolio and earnings growth. These initiatives are expected to improve product delivery, business operations, and scalability to better position us to capitalize on future market growth opportunities.
Another focus of our planned infrastructure investments is a continued effort to expand our servicing capabilities and to enhance the efficiency of processes associated with loan onboarding and servicing. We expect to continue to leverage technology enhancements and servicing standardization efforts to drive scalability and consistency. We plan to implement technology enhancements and process re-engineering over the next several years to continue to incorporate servicing platform optimization and to provide flexibility in accessing loan portfolio information, increase standardization of data and processing, and streamline operational workflows.
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Agricultural Finance Industry Outlook
Farm Incomes
The farm profitability outlook remains varied for 2026. Total net cash farm income rebounded slightly in 2025, rising 8% relative to 2024 according to the USDA. In 2026, the USDA’s initial forecast shows farm incomes rising another 3% relative to 2025. However, that expected overall improvement obscures a bifurcation across agricultural sectors. Namely, crop producers face headwinds from tepid commodity prices and elevated input costs that have compressed margins, while livestock producers are expected to benefit again in 2026 from robust consumer and export demand, falling feed costs, and continued herd contraction. Shifts in the outlook for trade could have a meaningful impact on commodity prices and farm incomes. The current USDA forecast shows U.S. agricultural exports increasing modestly in 2026.
Global energy prices spiked in first quarter 2026 and remained volatile in second quarter 2026 due to events in the Middle East. The disruption of Middle East energy flows corresponded with an increase in fuel, fertilizer, and many agricultural commodity prices. Prices remained volatile for numerous agricultural inputs and commodities in the second quarter 2026 as a result of the market and supply chain disruptions. Ultimately, agricultural profitability levels will likely be dependent on individual marketing and risk management plans throughout the growing season
A divergence in commodity prices between row crops and proteins combined with elevated input costs could lead to competing and compounding impacts on loan performance and agricultural credit demand. Constraints on cash flow and additional market volatility could cause loan delinquencies to rise above historical averages, most likely in commodities experiencing negative market conditions, such as some grains and permanent crops. Cash flow constraints and heightened uncertainty can also increase demand for debt capital to reorganize balance sheets and replace lost incomes. We believe that our portfolio and market strategy is sufficiently diversified by borrower, industry, and region to maintain robust portfolio performance through the current cycle to be positioned to support any expansion of the farm mortgage market that may arise in the coming quarters.
Land Values
Farmland value growth rates continued to moderate in 2025 following successive years of strong appreciation. Land value survey data from the USDA shows a 4.3% increase in average farm real estate values from June 2024 to June 2025. Annual farm real estate value gains were highest in the Southern Plains (5.9%) and the Lake states (5.7%) and still strong but slowing in the Northern Plains (4.9%), the Southeast (4.7%), and the Corn Belt (4.0%).
Farmland transaction data show farmland sales prices moving higher in 2026. The Farmer Mac Farmland Price Index Powered by AcreValue® rose 6% in first quarter 2026 relative to the same period in 2025. Basing this index on actual farmland transactions can lead to greater volatility, as many economic factors affecting land markets are highly localized and some markets may experience greater volatility in farmland values than state or national averages indicate. Based on our robust collateral underwriting standards, we believe that our loan collateral is well-positioned to endure reasonably foreseeable volatility in farmland values that could result from external factors.
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Markets and Weather
Exogenous factors facing farm and food producers can create uncertainty and market instability within the sector. Some of the external market conditions that have affected, and could continue to adversely affect, the farm and food sectors in 2026 include foreign trade and trade policy, supply chain disruptions, and weather and environmental conditions. Another notable factor that emerged in second quarter 2026 was the detection of New World Screwworm (NWS) in a number of southern states. NWS can have localized impacts on beef supply, as it can be fatal if left untreated, potentially leading to higher monitoring costs for producers in affected regions. NWS cannot be transmitted through processed beef, which potentially mitigates the impact to overall demand for U.S. beef, both domestically and from abroad. Previous outbreaks of NWS in the U.S. have been contained through the deployment of sterile NWS flies and other actions. As such, the USDA is currently expanding sterile fly production to help eliminate NWS from the U.S. once again.
Water availability is a perennial concern for many agricultural producers. Drought conditions increased modestly in intensity and prevalence in second quarter 2026, largely across several southern, southwestern, and southeastern states. The ongoing implementation of groundwater management regulation, especially in California, continues to influence land values in many regions of the state. We work closely with water consultants and collateral valuation professionals to identify properties influenced by changing water availability. For loans in areas that commonly experience exceptional drought (primarily in California), our underwriting standards include an assessment of anticipated long-term water availability for the related property and how water availability impacts the collateral value and the borrower's liquidity position to mitigate that risk.
Agricultural Processing and Food Supply Chain
The production of food, feed, fiber, and biofuels has generally been economically viable during the past few years, but economic factors continue to evolve into 2026. Biofuels have gained demand due to low-carbon regulations in several states and incremental tax benefits for the production of renewable diesel and sustainable aviation fuel. A spike in energy prices in the first half of 2026 is also potentially supportive of biofuel margins. However, the durability of elevated energy prices remains unclear and volatility remains elevated in both biofuel markets and the broader energy sector. A large number of planned biofuel projects and new facilities for 2026 and 2027 could provide support for raw materials such as corn and soybeans, but markets for these fuels are nascent and could evolve or erode rapidly in the coming quarters. Trade policy uncertainty, labor availability, changes to consumer demand due to health policy and pharmaceuticals (e.g., GLP-1 class drugs), and a high risk of global economic stress could pose challenges for these sectors into 2026. Still, consumer spending held steady throughout 2024 and 2025, providing stable conditions for value-added food, feed, fiber, and biofuel consumption. Consumer demand is expected to generate both tailwinds and headwinds for food processors and agribusinesses in 2026, as shifting preferences around nutrition, protein consumption, wellness, and discretionary spending continue to influence purchasing behavior and market opportunities.
Infrastructure Finance Industry Outlook
Power & Utilities
Economic conditions affecting rural power and electricity markets typically follow those in the general economy. According to data from the U.S. Energy Information Administration, sales and the revenue from
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the sale of electricity to customers continued climbing in 2026, with an annual increase in sales of 1.0% and an increase in revenue of 7.4%, respectively, in the last 12 months through April 2026 compared to April 2025. This increase was the result of higher commercial electricity sales combined with a sizable increase in average prices paid for electricity relative to the previous year. Electricity demand was consistently strong in 2025 and into 2026, and power producers are continuing to invest in more capacity to meet the rising demand from consumers and data centers. Continued geopolitical uncertainty in the Middle East and Eastern Europe have led to higher energy price volatility, but power producers are generally able to pass higher input costs through to retail electricity prices, as evidenced by higher retail electricity prices in 2025 and 2026. Credit demand for electric cooperatives will likely be tied to ongoing normal-course capital expenditures related to maintaining and upgrading utility infrastructure. These growth opportunities may be affected by the demand for electric power in rural areas, increased power demand from regional data centers, capital expenditures by electric cooperatives driven by regulatory or technological changes, the changing interest rate environment, increased policy initiatives to support rural connectivity, and competitive dynamics within the rural utilities cooperative finance industry. Generally, these investments are expected to continue at or above historical levels based on the replacement and modernization of existing and new infrastructure, as well as increasing demand for electricity across the spectrum of residential, commercial, and industrial customers.
Renewable Energy
Investment in renewable energy generation and deployment of energy storage technologies in the last five years deepened our relationships with existing customers through new business opportunities. According to data from the U.S. Energy Information Administration, renewable energy net generation grew by 52% in the last five years, compared to a 1% decline in non-renewable electricity net generation. The volatile cost of fossil fuel-based inputs, combined with policy initiatives and the falling costs of renewable power generation, influenced this change in generation capacity. In response to this expansion, we have hired industry-specialized staff and deployed new financing products tailored to the renewable energy sector, which represents a rapidly developing market opportunity for Farmer Mac.
Changes to tax policy may alter the trajectory and velocity of investments in U.S. renewable energy. H.R. 1, commonly referred to as the "One Big Beautiful Bill Act" signed into law on July 4, 2025, phases out tax credits that have been routinely used to support renewable power project investments. As these tax credits phase out, new power projects are still likely to be financed, but the marginal costs of electricity generation may be higher without subsidies. Increased political and policy uncertainty and higher cost structures could decrease the overall renewable power investment market growth velocity over the next five years. Wood Mackenzie estimates U.S. solar installations dropped 14% in 2025 relative to the total gigawatts installed in 2024. At the same time, Wood Mackenzie’s forecast for utility-scale solar deployments over the next decade in second quarter 2026 was nearly unchanged from the second quarter 2025 forecast. This underscores expectations for a continued robust solar energy development in the U.S., even after accounting for the tax credit phaseout, in response to rising energy demand. We expect to continue to participate in renewable energy power project finance transactions for both new projects and refinancing opportunities of existing projects.
As of June 30, 2026, we have utilized the majority of our remaining capacity to use renewable energy investment tax credits to carry back to the prior three years' federal corporate income tax liability, however, we will continue to pursue opportunities to purchase renewable energy investment tax credits to apply to the current tax year and future tax years to the extent possible. We focus on purchasing renewable energy investment tax credits for projects in rural areas or associated with agriculture, such as credits
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generated through the production of cleaner transportation fuels. Under H.R. 1's phase-outs of future renewable energy investment tax credits, projects eligible for renewable energy investment tax credits generally must be placed in service by December 31, 2027 unless construction begins by July 4, 2026.
Broadband Infrastructure
Rural telecommunication and data connectivity has proven to be of vital economic importance in the last decade, as more households and agricultural enterprises require more data and connectivity to thrive. The expected continued rapid growth in digital technologies, including the ongoing interest and investment in artificial intelligence, advancements in cloud computing, and wireless network densification, will require significantly more computing and storage capabilities and investment in more fiber network capacity. In addition to capital projects spurred by government-backed support programs, we could see an increase in financing opportunities for other telecommunications providers in rural areas. For example, fiber line expansion, wireless broadband deployment, industry consolidation and efficiency through mergers and acquisitions, and data processing center build-outs are all increasingly important to rural economic opportunity, and the food and agriculture industries require constant connectivity. However, some types of "leapfrog" technology advances in the broadband infrastructure sector, such as low orbit satellite communication systems, could put pressure on the profitability of the providers of older digital technologies.
Changes in tax policy, trade, and immigration laws, as well as energy cost and availability, could result in significant challenges and opportunities to infrastructure borrowers. These changes could lead to delays in completing current projects and slow future investments in renewable energy and battery storage projects as well as the deployment of fiber and broadband infrastructure in rural areas. Any lack of availability or increased costs of components or technology that results from tariffs or trade restrictions also could lead to delays in completion or slow future investments in infrastructure projects. The infrastructure sector may experience varying degrees of disruption and adaptation in response to these evolving policies, and these changes could increase the volatility of sector profitability in the near-term. The potential for disruption in these sectors due to policy changes may be somewhat mitigated by the historically strong market demand for connectivity, the ongoing diversification of infrastructure providers, and continued strong investments in data centers and fiber infrastructure. New data center infrastructure requires significant demand for power, so delays in grid hookups or electricity capacity could delay some capital or infrastructure deployment.
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Balance Sheet Review
The following table summarizes our balance sheet as of the periods indicated:
Table 19
| As of | Change | ||||||||||||||||||||||
| June 30, 2026 | December 31, 2025 | $ | % | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Cash and cash equivalents | $ | 1,038,091 | $ | 931,067 | $ | 107,024 | 11 | % | |||||||||||||||
| Investment securities | 19,425,162 | 17,550,379 | 1,874,783 | 11 | % | ||||||||||||||||||
| Loans, net of allowance | 15,857,000 | 13,840,378 | 2,016,622 | 15 | % | ||||||||||||||||||
| Loans held in trusts | 2,323,844 | 2,480,898 | (157,054) | (6) | % | ||||||||||||||||||
| Other | 646,095 | 567,435 | 78,660 | 14 | % | ||||||||||||||||||
| Total assets | $ | 39,290,192 | $ | 35,370,157 | $ | 3,920,035 | 11 | % | |||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Notes Payable | $ | 34,693,922 | $ | 30,822,570 | $ | 3,871,352 | 13 | % | |||||||||||||||
| Debt securities of consolidated trusts held by third parties | 2,217,532 | 2,365,435 | (147,903) | (6) | % | ||||||||||||||||||
| Other | 524,304 | 463,203 | 61,101 | 13 | % | ||||||||||||||||||
| Total liabilities | $ | 37,435,758 | $ | 33,651,208 | $ | 3,784,550 | 11 | % | |||||||||||||||
| Total equity | 1,854,434 | 1,718,949 | 135,485 | 8 | % | ||||||||||||||||||
| Total liabilities and equity | $ | 39,290,192 | $ | 35,370,157 | $ | 3,920,035 | 11 | % | |||||||||||||||
Assets. The increase in total assets was primarily attributable to new loan volume and a larger investment portfolio.
Liabilities. The increase in total liabilities was primarily due to an increase in total notes payable to fund the acquisition of loan volume.
Equity. The increase in total equity was primarily due to an increase of $96.8 million related to the
issuance of 4.0 million shares of 6.875% non-cumulative perpetual Series I preferred stock in addition to
an increase in retained earnings.
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Risk Management
Credit Risk – Loans and Guarantees.
We are exposed to both direct and indirect credit risk. We have direct credit exposure to our Agricultural Finance mortgage loans, Infrastructure Finance loans, and loans underlying off-balance sheet Farmer Mac Guaranteed Securities and LTSPCs. We have indirect credit exposure to the Agricultural Finance mortgage loans and Infrastructure Finance loans that secure AgVantage securities because, in the event of a default on an AgVantage security, we have recourse to the pledged collateral and have rights to the ongoing borrower payments of principal and interest.
Agricultural Finance - Direct Credit Exposure
Our direct credit exposure to Agricultural Finance mortgage loans as of June 30, 2026 was $15.0 billion across 48 states.
When analyzing the credit quality of our Agricultural Finance mortgage loans, we consider the level of internally-rated "substandard" assets, both in dollars and as a percentage of the outstanding portfolio. Assets categorized as "substandard" have a well-defined weakness or weaknesses, and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.
The following table disaggregates the Agricultural Finance mortgage loans by portfolio segment and by internally assigned risk ratings.
Table 20
| As of June 30, 2026 | |||||||||||||||||||||||
Agricultural Finance mortgage loans by internally assigned risk rating | |||||||||||||||||||||||
| Acceptable | Special Mention | Substandard | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
Farm & Ranch | $ | 11,990,983 | $ | 699,500 | $ | 496,898 | $ | 13,187,381 | |||||||||||||||
Corporate AgFinance | 1,619,562 | 79,998 | 79,590 | 1,779,150 | |||||||||||||||||||
Agricultural Finance Total | $ | 13,610,545 | $ | 779,498 | $ | 576,488 | 14,966,531 | ||||||||||||||||
Agricultural Finance mortgage loans classified as substandard increased $82.3 million to $576.5 million, or 3.9% of the portfolio, as of June 30, 2026 from $494.2 million, or 3.5% of the portfolio, as of December 31, 2025. The increase in substandard assets for Agricultural Finance loans was primarily driven by credit downgrades.
Our 90-day delinquency measure includes loans 90 days or more past due, as well as loans in foreclosure and non-performing loans where the borrower is in bankruptcy. As of June 30, 2026, 90-day delinquencies on Agricultural Finance mortgage loans with direct credit exposure were $139.1 million, or 0.93% of the portfolio, an improvement over the $179.8 million in 90-day delinquencies, or 1.25% of the portfolio, as of March 31, 2026. The sequential fluctuations in quarter-end delinquency rates presented in the table below is consistent with prior historical trends for which delinquency rates tend to peak in the first and third quarters of the year, based in part on the timing of semi-annual and quarterly payment due dates. While delinquency rates are monitored as an early indicator of credit risk, management believes that the allowance for credit losses appropriately reflects current credit conditions in the portfolio, including the impact of collateral characteristics.
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The following table presents historical information about our contractual 90-day delinquencies in the Agricultural Finance mortgage loan portfolio compared to the unpaid principal balance of all Agricultural Finance mortgage loans to which we have direct credit exposure:
Table 21
| Agricultural Finance Mortgage Loans | 90-Day Delinquencies | Percentage | |||||||||||||||
| (dollars in thousands) | |||||||||||||||||
| As of: | |||||||||||||||||
| June 30, 2026 | $ | 14,966,531 | $ | 139,128 | 0.93 | % | |||||||||||
| March 31, 2026 | 14,385,557 | 179,817 | 1.25 | % | |||||||||||||
| December 31, 2025 | 14,045,056 | 132,550 | 0.94 | % | |||||||||||||
| September 30, 2025 | 13,122,678 | 177,759 | 1.35 | % | |||||||||||||
| June 30, 2025 | 12,836,478 | 125,868 | 0.98 | % | |||||||||||||
| March 31, 2025 | 12,389,478 | 159,977 | 1.29 | % | |||||||||||||
| December 31, 2024 | 12,369,477 | 108,944 | 0.88 | % | |||||||||||||
| September 30, 2024 | 11,466,670 | 144,407 | 1.26 | % | |||||||||||||
| June 30, 2024 | 11,409,396 | 62,063 | 0.54 | % | |||||||||||||
For Farm & Ranch loans, we consider a loan's original loan-to-value ("LTV") ratio as one of many factors in evaluating loss severity. LTV depends on the market value of a property, as determined in accordance with our collateral valuation standards. As of June 30, 2026 and December 31, 2025, the average unpaid principal balances for Farm & Ranch loans outstanding and to which we have direct credit exposure was $859,000 and $836,000, respectively. We calculate the "original LTV" ratio of a loan by dividing the original loan principal balance by the original appraised property value. This calculation does not reflect any amortization of the original loan balance or any adjustment to the original appraised value to provide a current market value. The original LTV ratio of any cross-collateralized loans is calculated on a combined basis rather than on a loan-by-loan basis. The weighted-average original LTV ratio for Farm & Ranch mortgage loans purchased during second quarter 2026 was 52%, compared to 51% for loans purchased during second quarter 2025. The weighted-average original LTV ratio for exposure related to on- and off-balance sheet Farm & Ranch mortgage loans was 53% and 52% as of June 30, 2026 and December 31, 2025, respectively. The weighted-average original LTV ratio for 90-day delinquencies for Farm & Ranch loans was 53% and 54% as of June 30, 2026 and December 31, 2025, respectively.
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Analysis of portfolio performance indicates that commodity type is the primary determinant of our exposure to loss on a given loan. Although some credit losses are inherent to the business of agricultural lending, we believe that losses associated with the current agricultural credit cycle will be moderated by the strength and diversity of our Agricultural Finance portfolio, which we believe is adequately collateralized. The following tables present concentrations of Agricultural Finance mortgage loans by commodity type within geographic region and cumulative credit losses by origination year and commodity type:
Table 22
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance Mortgage Loans Concentrations by Commodity Type within Geographic Region | |||||||||||||||||||||||||||||||||||||||||
| Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Other | Total | |||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||
By geographic region(1): | |||||||||||||||||||||||||||||||||||||||||
| Northwest | $ | 827,102 | $ | 235,890 | $ | 394,558 | $ | 122,019 | $ | 41,708 | $ | 581 | $ | 1,621,858 | |||||||||||||||||||||||||||
| 5.5 | % | 1.6 | % | 2.6 | % | 0.8 | % | 0.3 | % | — | % | 10.8 | % | ||||||||||||||||||||||||||||
| Southwest | 826,195 | 1,833,846 | 718,246 | 113,579 | 252,653 | 2,218 | 3,746,737 | ||||||||||||||||||||||||||||||||||
| 5.4 | % | 12.3 | % | 4.8 | % | 0.8 | % | 1.7 | % | — | % | 25.0 | % | ||||||||||||||||||||||||||||
| Mid-North | 3,197,294 | 10,122 | 346,328 | 72,112 | 310,402 | 343 | 3,936,601 | ||||||||||||||||||||||||||||||||||
| 21.4 | % | 0.1 | % | 2.3 | % | 0.5 | % | 2.1 | % | — | % | 26.4 | % | ||||||||||||||||||||||||||||
| Mid-South | 1,744,588 | 107,252 | 1,263,202 | 69,790 | 101,746 | 2,806 | 3,289,384 | ||||||||||||||||||||||||||||||||||
| 11.7 | % | 0.7 | % | 8.4 | % | 0.5 | % | 0.7 | % | — | % | 22.0 | % | ||||||||||||||||||||||||||||
| Northeast | 285,968 | 51,148 | 88,026 | 44,886 | 155,062 | — | 625,090 | ||||||||||||||||||||||||||||||||||
| 1.9 | % | 0.3 | % | 0.6 | % | 0.3 | % | 1.0 | % | — | % | 4.1 | % | ||||||||||||||||||||||||||||
| Southeast | 653,766 | 379,014 | 397,458 | 65,396 | 251,227 | — | 1,746,861 | ||||||||||||||||||||||||||||||||||
| 4.4 | % | 2.5 | % | 2.7 | % | 0.4 | % | 1.7 | % | — | % | 11.7 | % | ||||||||||||||||||||||||||||
| Total | $ | 7,534,913 | $ | 2,617,272 | $ | 3,207,818 | $ | 487,782 | $ | 1,112,798 | $ | 5,948 | $ | 14,966,531 | |||||||||||||||||||||||||||
| 50.3 | % | 17.5 | % | 21.4 | % | 3.3 | % | 7.5 | % | — | % | 100.0 | % | ||||||||||||||||||||||||||||
(1)Geographic regions: Northwest (AK, ID, MT, OR, WA, WY); Southwest (AZ, CA, CO, HI, NM, NV, UT); Mid-North (IA, IL, IN, MI, MN, NE, ND, SD, WI); Mid-South (AR, KS, LA, MO, OK, TX); Northeast (CT, DE, KY, MA, MD, ME, NH, NJ, NY, OH, PA, RI, VA, VT, WV); Southeast (AL, FL, GA, MS, NC, SC, TN).
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Table 23
| As of June 30, 2026 | |||||||||||||||||||||||||||||||||||
| Agricultural Finance Mortgage Loans Cumulative Credit Losses/(Recoveries) by Origination Year and Commodity Type | |||||||||||||||||||||||||||||||||||
| Crops | Permanent Plantings | Livestock | Part-time Farm | Ag. Storage and Processing | Total | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
| By year of origination: | |||||||||||||||||||||||||||||||||||
| 2016 and prior | $ | 3,857 | $ | 10,444 | $ | 3,836 | $ | 1,132 | $ | 15,674 | $ | 34,943 | |||||||||||||||||||||||
| 2017 | — | — | — | — | 4,310 | 4,310 | |||||||||||||||||||||||||||||
| 2018 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| 2019 | 1,687 | — | — | — | — | 1,687 | |||||||||||||||||||||||||||||
| 2020 | (65) | — | (22) | — | — | (87) | |||||||||||||||||||||||||||||
| 2021 | — | 2,336 | — | — | 16,994 | 19,330 | |||||||||||||||||||||||||||||
| 2022 | 1,685 | — | — | — | 455 | 2,140 | |||||||||||||||||||||||||||||
| 2023 | — | 3,019 | — | — | — | 3,019 | |||||||||||||||||||||||||||||
| 2024 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| 2025 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| 2026 | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Total | $ | 7,164 | $ | 15,799 | $ | 3,814 | $ | 1,132 | $ | 37,433 | $ | 65,342 | |||||||||||||||||||||||
For more information about the credit quality of our Agricultural Finance mortgage loans and the associated allowance for losses please refer to Note 4—Loans to the consolidated financial statements. Activity affecting the allowance for loan losses is discussed in MD&A—Results of Operations—Provision for and Release of Allowance for Loan Losses.
Infrastructure Finance - Direct Credit Exposure
Our direct credit exposure to Infrastructure Finance loans held and loans underlying LTSPCs as of June 30, 2026 was $9.2 billion across 45 states.
As of June 30, 2026 and December 31, 2025, there were no delinquencies in our Infrastructure Finance line of business. Substandard assets within the Infrastructure Finance portfolio decreased to $58.7 million as of June 30, 2026 compared to $75.5 million as of December 31, 2025 due to a credit upgrade within the Renewable Energy portfolio.
The following table disaggregates the Infrastructure Finance loans by portfolio segment and by internally assigned risk ratings:
Table 24
| As of June 30, 2026 | |||||||||||||||||||||||
Infrastructure Finance loans by internally assigned risk rating | |||||||||||||||||||||||
| Acceptable | Special Mention | Substandard | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
Power & Utilities | $ | 4,341,536 | $ | — | $ | — | $ | 4,341,536 | |||||||||||||||
| Renewable Energy | 2,927,819 | 65,750 | 14,443 | 3,008,012 | |||||||||||||||||||
Broadband Infrastructure | 1,705,940 | 56,666 | 44,297 | 1,806,903 | |||||||||||||||||||
Infrastructure Finance Total | $ | 8,975,295 | $ | 122,416 | $ | 58,740 | $ | 9,156,451 | |||||||||||||||
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For more information about the credit quality of our Infrastructure Finance line of business and the associated allowance for losses please refer to Note 4—Loans to the consolidated financial statements.
Other Considerations Regarding Credit Risk Related to Loans and Guarantees
The credit exposure on USDA Securities, including those underlying Farmer Mac Guaranteed USDA Securities, is guaranteed by the full faith and credit of the United States. Therefore, we believe there is little or no credit risk exposure to the USDA Securities in the Agricultural Finance line of business. As of June 30, 2026, we had not experienced any credit losses on any USDA Securities or Farmer Mac Guaranteed USDA Securities and do not expect to incur any such losses in the future. Because we do not expect credit losses on this portfolio, we do not provide an allowance for losses on the USDA portfolio.
Credit Risk – Counterparty Risk. We are exposed to credit risk arising from our business relationships with other institutions, which include:
•issuers of AgVantage Securities;
•approved lenders and servicers; and
•interest rate swap counterparties.
As of June 30, 2026, we have had no credit losses on AgVantage Securities over the life of the program.
The following table provides information about the issuers of AgVantage Securities and the required collateralization levels for those transactions as of June 30, 2026 and December 31, 2025:
Table 25
| As of June 30, 2026 | As of December 31, 2025 | |||||||||||||||||||||||||
| Counterparty | Balance | Required Collateralization | Balance | Required Collateralization | ||||||||||||||||||||||
| (dollars in thousands) | ||||||||||||||||||||||||||
| AgVantage: | ||||||||||||||||||||||||||
| CFC | $ | 3,905,103 | 100% | $ | 3,967,154 | 100% | ||||||||||||||||||||
| MetLife | 2,050,000 | 103% | 2,050,000 | 103% | ||||||||||||||||||||||
| Rabo AgriFinance | 2,240,000 | 105% | 1,620,000 | 105% | ||||||||||||||||||||||
Other(1) | 1,753,613 | 100% to 125% | 790,977 | 100% to 125% | ||||||||||||||||||||||
| Total outstanding | $ | 9,948,716 | $ | 8,428,131 | ||||||||||||||||||||||
(1)Consists of AgVantage Securities issued by 11 and 9 different issuers as of June 30, 2026 and December 31, 2025, respectively.
We require many lenders to make representations and warranties about the conformity of Agricultural Finance mortgage loans to our standards, the accuracy of provided loan data, and other requirements related to the loans. During the six months ended June 30, 2026, there have been no breaches of representations and warranties by sellers requiring a seller to cure, replace, or repurchase a loan.
We also contract with other institutions to undertake servicing responsibilities for a portion of our Agricultural Finance mortgage loans in accordance with our specified servicing requirements or accepted servicing standards established by the servicing institution. In the event of a breach of the terms of its servicing agreement with Farmer Mac, such as failing to forward payments received or releasing collateral without our consent, or insolvency or bankruptcy, the servicer is responsible for any corresponding damages. In most cases, we have the right to terminate the servicing relationship for a particular loan or
73
the entire portfolio serviced by the servicer. We may also proceed against the servicer in arbitration or exercise any remedies available to us under law.
We manage institutional credit risk related to interest rate swap counterparties through collateralization provisions contained in each of our swap agreements that vary based on the market value of our swap portfolio with each counterparty. For cleared swap transactions and non-cleared swap transactions entered into after March 1, 2017, we and our interest rate swap counterparties are required to fully collateralize their derivatives positions without any minimum threshold. We enter into interest rate swaps with multiple counterparties to reduce counterparty credit exposure concentration. Our use of cleared derivatives has increased over time which reduces our exposure to individual counterparties with the central clearinghouse acting to settle the change in value of contracts on a daily basis. Credit risk related to interest rate swap contracts is discussed in MD&A—Risk Management—Interest Rate Risk and Note 3—Financial Derivatives to the consolidated financial statements.
Credit Risk – Other Investments. The management of the credit risk inherent in these investments is governed by the Liquidity and Investment Regulations and our internal policies.
The Liquidity and Investment Regulations and our internal policies establish concentration limits, which are intended to limit exposure to any single entity, issuer, or obligor. While the Liquidity and Investment Regulations limit our total credit exposure to any single entity, issuer, or obligor of securities to 10% of our regulatory capital ($192.3 million as of June 30, 2026), our current policy limit is 5% of our regulatory capital ($96.1 million as of June 30, 2026). These exposure limits do not apply to obligations of U.S. government agencies or GSEs, although our current policy restricts investing more than 100% of regulatory capital in the senior non-convertible debt securities of any one GSE.
Interest Rate Risk. We are subject to interest rate risk on all interest-earning assets on our balance sheet due to timing differences in the cash flows related to maturity, paydown, or repricing of the assets and debt together with financial derivatives. The goal of our interest rate risk management is to manage the balance sheet in a manner that generates stable earnings and value across a variety of interest rate environments. Recognizing that interest rate sensitivities may change with the passage of time and as interest rates change, we regularly assess this exposure and, if necessary, adjust our portfolio of interest-earning assets, debt, and financial derivatives.
We are also subject to interest rate risk on loans and securities we have committed to acquire but not yet purchased (other than delinquent loans purchased through LTSPCs or loans designated for securitization under a forward purchase agreement). When we commit to purchase these assets, we are exposed to interest rate risk between the time we commit to purchase the loan and the time we issue debt to fund the loan purchase. We manage interest rate risk exposure related to these loans by entering into exchange-traded futures contracts involving U.S. Treasury securities and other financial derivatives. Similarly, when we commit to sell certain assets, the associated interest rate exposure is primarily managed with exchange-traded futures contracts involving U.S. Treasury securities and other financial derivatives.
74
Interest Rate Risk Metrics
We regularly evaluate and conduct interest rate shock simulations on our portfolio of financial assets, debt, and financial derivatives and examine a variety of metrics to quantify and manage our exposure to interest rate risk. These metrics include sensitivity to interest rate movements on the market value of equity ("MVE") and forecasted NES as well as a duration gap analysis.
MVE represents our estimate of the present value of all future cash flows from our current portfolio of on- and off-balance sheet assets, liabilities, and financial derivatives, discounted at current interest rates and appropriate spreads. However, MVE is not indicative of our market value as a going concern as these market values are theoretical and do not reflect future business activities. The MVE sensitivity analysis measures the degree to which the market values of our assets, liabilities, and financial derivatives are estimated to change for a given change in interest rates.
Our NES simulation represents the difference between projected income over the next twelve months from the current portfolio of interest-earning assets and interest expense produced by the related funding, including associated financial derivatives. The NES simulation may be impacted by changes in market interest rates resulting from timing differences between maturities and re-pricing characteristics of funded assets and debt together with the associated financial derivatives. The direction and magnitude of any such effect depends on the direction and magnitude of the change in interest rates across the yield curve as well as the composition of our portfolio. The NES simulation represents an estimate of NES that our current portfolio is expected to produce over a twelve-month horizon. As a result, the NES simulation sensitivity statistics provide a short-term view of our NES sensitivity to interest rate shocks.
Duration is a measure of a financial instrument's fair value sensitivity to changes in interest rates. Duration gap is calculated using the net estimated durations of our interest-earning assets, debt, and financial derivatives. Duration gap quantifies the extent to which estimated fair value sensitivities are matched for interest-earning assets, debt and financial derivatives. Duration gap provides a relatively concise measure of the interest rate risk inherent in our outstanding portfolio.
A positive duration gap indicates that with small changes in interest rate movements the fair value change of our interest-earning assets is more sensitive than the fair value change of our debt and financial derivatives. Conversely, a negative duration gap indicates that with small changes in interest rate movements the fair value change of our interest-earning assets are less sensitive than the fair value change of our debt and financial derivatives. A duration gap of zero indicates that with small changes in interest rate movements the fair value change of our interest-earning assets is effectively offset by the fair value change of our debt and financial derivatives.
Each of the interest rate risk metrics is quantified using asset/liability models and derived based on our best estimates of factors such as implied forward interest rates across the yield curve, interest rate volatility, and timing of asset prepayments and callable debt redemptions. Accordingly, these metrics are estimates rather than precise measurements. Actual results may differ to the extent there are material changes to our financial asset portfolio or changes in funding or hedging strategies undertaken to mitigate unfavorable sensitivities to interest rate changes.
75
The following schedule summarizes our MVE and NES sensitivity analysis as of June 30, 2026 and December 31, 2025 to an immediate and instantaneous uniform or "parallel" shift in the yield curve:
Table 26
| Percentage Change in MVE from Base Case | ||||||||||||||
| Interest Rate Scenario | As of June 30, 2026 | As of December 31, 2025 | ||||||||||||
| +100 basis points | (2.3) | % | (2.9) | % | ||||||||||
| -100 basis points | 2.0 | % | 3.3 | % | ||||||||||
| Percentage Change in NES from Base Case | ||||||||||||||
| Interest Rate Scenario | As of June 30, 2026 | As of December 31, 2025 | ||||||||||||
| +100 basis points | (0.4) | % | (1.3) | % | ||||||||||
| -100 basis points | 2.4 | % | 2.4 | % | ||||||||||
As of June 30, 2026, we reported a positive effective duration gap of 2.9 months, compared to positive 3.7 months as of December 31, 2025. The yield curve increased in 2026, with yields on the 2‑year and 10‑year U.S. Treasury notes rising by approximately 70 and 30 basis points, respectively. These interest rate movements contributed to an extension of our liabilities, thereby narrowing the duration gap.
Financial Derivatives Transactions
The economic effects of financial derivatives are included in our MVE, NES, and duration gap analyses. We enter into interest rate swaps to more closely match the cash flow and duration characteristics of our interest-earning assets with those of our debt.
As of June 30, 2026, we had $28.7 billion combined notional amount of interest rate swaps, with terms ranging from less than one year to approximately thirty years, of which $12.6 billion were pay-fixed interest rate swaps, $15.8 billion were receive-fixed interest rate swaps, and $0.3 billion were basis swaps.
Certain financial derivatives are designated as fair value hedges of fixed rate assets classified as AFS or liabilities to protect against fair value changes in the assets or liabilities related to a benchmark interest rate (e.g. SOFR). Also, certain financial derivatives are designated as cash flow hedges to mitigate the volatility of future interest rate payments on floating rate debt. All of our interest rate swap transactions are conducted under standard collateralized agreements that limit our potential credit exposure to any counterparty. As of both June 30, 2026 and December 31, 2025, we had no uncollateralized net exposures based on the mark-to-market value of the portfolio of interest rate swaps.
Re-funding and repricing risk
We are subject to re-funding and repricing risk on any floating rate assets, including certain fixed rate assets that are synthetically converted to floating rate through pay‑fixed, receive‑floating interest rate swaps, that are not funded to contractual maturity. This risk arises from potential changes in funding costs resulting from a funding strategy whereby we issue floating rate debt across a variety of maturities to fund floating rate or synthetically floating rate assets that, on average, may have longer maturities. Changes in our funding costs relative to the asset's benchmark market index rate can cause changes to NII when debt matures and is reissued at then-current interest rates to continue funding those assets.
76
As of June 30, 2026, we held $10.2 billion of floating rate assets in our lines of business and our investment portfolio that reset based on floating rate market indices, such as SOFR. As of June 30, 2026, we had $12.6 billion of pay-fixed interest rate swaps outstanding.
Liquidity and Capital Resources
We regularly access the debt capital markets for funding, and we maintained steady access to the debt capital markets through the second quarter of 2026 and throughout 2025.
Assuming continued access to the debt capital markets, we believe we have sufficient liquidity and capital resources to support our operations for the next 12 months and for the foreseeable future. We have a contingency funding plan to manage unanticipated disruptions in our access to the debt capital markets, which requires us to maintain a minimum of 90 days of liquidity under the Liquidity and Investment Regulations. In accordance with the methodology for calculating available days of liquidity under those regulations, we maintained a monthly average of 282 days of liquidity in the second quarter of 2026 and had 264 days of liquidity as of June 30, 2026.
The following table presents our liquidity investments as of June 30, 2026 and December 31, 2025:
Table 27
| As of June 30, 2026 | As of December 31, 2025 | ||||||||||
| (in thousands) | |||||||||||
| Cash and cash equivalents | $ | 1,038,091 | $ | 931,067 | |||||||
| Investment securities: | |||||||||||
| Guaranteed by U.S. Government and its agencies | 1,893,934 | 1,940,624 | |||||||||
| Guaranteed by GSEs | 5,229,332 | 4,909,198 | |||||||||
| Total | $ | 8,161,357 | $ | 7,780,889 | |||||||
The objectives of the liquidity investment portfolio as of June 30, 2026 and December 31, 2025 are to provide a level of liquidity that mitigates enterprise risk, provides a reliable source of short-term and long-term liquidity and to support program asset growth.
Capital Requirements. We are subject to the following statutory capital requirements – minimum, critical, and risk-based. We must comply with the higher of the minimum capital requirement and the risk-based capital requirement. As of June 30, 2026, we were in compliance with our statutory capital requirements and were classified within "level 1" (the highest compliance level).
77
Capital
Table 28
| As of | |||||||||||
| June 30, 2026 | December 31, 2025 | ||||||||||
| (in thousands) | |||||||||||
| Core capital | $ | 1,872,668 | $ | 1,705,567 | |||||||
| Capital in excess of minimum capital level required | 730,689 | 677,695 | |||||||||
The capital in excess of the minimum capital level required increased from December 31, 2025 to June 30, 2026 primarily reflecting increased equity due to the issuance of preferred stock and net income generated during the period. This increase was partially offset by the capital impact due to growth in on‑balance sheet assets.
In accordance with the FCA's rule on capital planning, our board of directors has adopted a policy for maintaining a sufficient level of "Tier 1" capital (consisting of retained earnings, paid-in capital, common stock, and qualifying preferred stock). That policy restricts Tier 1-eligible dividends and any discretionary bonus payments if Tier 1 capital falls below specified thresholds. As of June 30, 2026 and December 31, 2025, our Tier 1 capital ratio was 13.2% and 13.3%, respectively. As of June 30, 2026, we were in compliance with the capital adequacy policy. We expect to continue complying with the FCA's capital planning requirements, including our Tier 1 capital policy, and do not expect such compliance to have a material effect on our operations or financial condition.
See Note 7—Equity to the consolidated financial statements for more information about our capital position.
Other Matters
None.
78
Supplemental Information
The following tables present quarterly and annual information about new business volume, repayments, and outstanding business volume:
Table 31
| New Business Volume | |||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | ||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Total | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
| For the quarter ended: | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | $ | 2,509,370 | $ | 191,248 | $ | 368,836 | $ | 415,577 | $ | 564,851 | $ | 4,049,882 | |||||||||||||||||||||||
| March 31, 2026 | 1,710,467 | 368,345 | 204,675 | 367,560 | 788,665 | 3,439,712 | |||||||||||||||||||||||||||||
| December 31, 2025 | 2,204,717 | 271,100 | 514,897 | 560,027 | 461,613 | 4,012,354 | |||||||||||||||||||||||||||||
| September 30, 2025 | 1,069,422 | 236,940 | 225,017 | 262,322 | 732,888 | 2,526,589 | |||||||||||||||||||||||||||||
| June 30, 2025 | 896,499 | 280,331 | 185,563 | 280,350 | 482,276 | 2,125,019 | |||||||||||||||||||||||||||||
| March 31, 2025 | 548,509 | 270,966 | 486,961 | 229,649 | 301,315 | 1,837,400 | |||||||||||||||||||||||||||||
| December 31, 2024 | 1,034,489 | 313,123 | 78,018 | 209,729 | 496,437 | 2,131,796 | |||||||||||||||||||||||||||||
| September 30, 2024 | 776,023 | 307,325 | 360,950 | 187,021 | 357,659 | 1,988,978 | |||||||||||||||||||||||||||||
| June 30, 2024 | 698,787 | 288,740 | 132,958 | 102,075 | 271,890 | 1,494,450 | |||||||||||||||||||||||||||||
| For the year ended: | |||||||||||||||||||||||||||||||||||
| December 31, 2025 | $ | 4,719,147 | $ | 1,059,337 | $ | 1,412,438 | $ | 1,332,348 | $ | 1,978,092 | $ | 10,501,362 | |||||||||||||||||||||||
| December 31, 2024 | $ | 3,175,215 | $ | 1,199,713 | $ | 685,471 | $ | 501,075 | $ | 1,473,884 | $ | 7,035,358 | |||||||||||||||||||||||
79
Table 32
| Repayments of Assets | |||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | ||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Total | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
| For the quarter ended: | |||||||||||||||||||||||||||||||||||
| Scheduled | $ | 498,515 | $ | 104,856 | $ | 26,716 | $ | 253,823 | $ | 444,605 | $ | 1,328,515 | |||||||||||||||||||||||
| Unscheduled | 248,374 | 56,184 | 51,114 | — | — | 355,672 | |||||||||||||||||||||||||||||
| June 30, 2026 | $ | 746,889 | $ | 161,040 | $ | 77,830 | $ | 253,823 | $ | 444,605 | $ | 1,684,187 | |||||||||||||||||||||||
| Scheduled | $ | 720,792 | $ | 153,348 | $ | 50,998 | $ | 209,618 | $ | 344,187 | $ | 1,478,943 | |||||||||||||||||||||||
| Unscheduled | 297,604 | 113,224 | 38,667 | — | — | 449,495 | |||||||||||||||||||||||||||||
| March 31, 2026 | $ | 1,018,396 | $ | 266,572 | $ | 89,665 | $ | 209,618 | $ | 344,187 | $ | 1,928,438 | |||||||||||||||||||||||
| Scheduled | $ | 622,740 | $ | 167,492 | $ | 46,628 | $ | 326,918 | $ | 301,889 | $ | 1,465,667 | |||||||||||||||||||||||
| Unscheduled | 206,690 | 44,300 | 34,164 | — | — | 285,154 | |||||||||||||||||||||||||||||
| December 31, 2025 | $ | 829,430 | $ | 211,792 | $ | 80,792 | $ | 326,918 | $ | 301,889 | $ | 1,750,821 | |||||||||||||||||||||||
| Scheduled | $ | 816,531 | $ | 202,391 | $ | 66,715 | $ | 137,666 | $ | 390,359 | $ | 1,613,662 | |||||||||||||||||||||||
| Unscheduled | 216,005 | 89,015 | 32,139 | — | — | 337,159 | |||||||||||||||||||||||||||||
| September 30, 2025 | $ | 1,032,536 | $ | 291,406 | $ | 98,854 | $ | 137,666 | $ | 390,359 | $ | 1,950,821 | |||||||||||||||||||||||
| Scheduled | $ | 513,179 | $ | 135,868 | $ | 32,388 | $ | 80,744 | $ | 149,904 | $ | 912,083 | |||||||||||||||||||||||
| Unscheduled | 190,374 | 80,303 | 40,787 | — | — | 311,464 | |||||||||||||||||||||||||||||
| June 30, 2025 | $ | 703,553 | $ | 216,171 | $ | 73,175 | $ | 80,744 | $ | 149,904 | $ | 1,223,547 | |||||||||||||||||||||||
| Scheduled | $ | 786,956 | $ | 169,532 | $ | 77,976 | $ | 57,279 | $ | 109,176 | $ | 1,200,919 | |||||||||||||||||||||||
| Unscheduled | 258,599 | 99,776 | 30,385 | — | — | 388,760 | |||||||||||||||||||||||||||||
| March 31, 2025 | $ | 1,045,555 | $ | 269,308 | $ | 108,361 | $ | 57,279 | $ | 109,176 | $ | 1,589,679 | |||||||||||||||||||||||
| Scheduled | $ | 41,265 | $ | 231,672 | $ | 38,003 | $ | 52,970 | $ | 174,920 | $ | 538,830 | |||||||||||||||||||||||
| Unscheduled | 120,505 | 36,526 | 25,084 | — | — | 182,115 | |||||||||||||||||||||||||||||
| December 31, 2024 | $ | 161,770 | $ | 268,198 | $ | 63,087 | $ | 52,970 | $ | 174,920 | $ | 720,945 | |||||||||||||||||||||||
| Scheduled | $ | 1,079,136 | $ | 239,596 | $ | 548,161 | $ | 94,513 | $ | 138,123 | $ | 2,099,529 | |||||||||||||||||||||||
| Unscheduled | 117,538 | 41,842 | 26,629 | — | — | 186,009 | |||||||||||||||||||||||||||||
| September 30, 2024 | $ | 1,196,674 | $ | 281,438 | $ | 574,790 | $ | 94,513 | $ | 138,123 | $ | 2,285,538 | |||||||||||||||||||||||
| Scheduled | $ | 752,473 | $ | 141,565 | $ | 62,237 | $ | 16,062 | $ | 138,725 | $ | 1,111,062 | |||||||||||||||||||||||
| Unscheduled | 342,594 | 89,576 | 32,984 | — | — | 465,154 | |||||||||||||||||||||||||||||
| June 30, 2024 | $ | 1,095,067 | $ | 231,141 | $ | 95,221 | $ | 16,062 | $ | 138,725 | $ | 1,576,216 | |||||||||||||||||||||||
| For the year ended: | |||||||||||||||||||||||||||||||||||
| Scheduled | $ | 2,739,406 | $ | 675,283 | $ | 223,707 | $ | 602,607 | $ | 951,328 | $ | 5,192,331 | |||||||||||||||||||||||
| Unscheduled | 871,668 | 313,394 | 137,475 | — | — | 1,322,537 | |||||||||||||||||||||||||||||
| December 31, 2025 | $ | 3,611,074 | $ | 988,677 | $ | 361,182 | $ | 602,607 | $ | 951,328 | $ | 6,514,868 | |||||||||||||||||||||||
| Scheduled | $ | 2,274,962 | $ | 731,718 | $ | 738,497 | $ | 199,763 | $ | 544,880 | $ | 4,489,820 | |||||||||||||||||||||||
| Unscheduled | 731,540 | 267,269 | 117,178 | — | — | 1,115,987 | |||||||||||||||||||||||||||||
| December 31, 2024 | $ | 3,006,502 | $ | 998,987 | $ | 855,675 | $ | 199,763 | $ | 544,880 | $ | 5,605,807 | |||||||||||||||||||||||
80
Table 33
| Outstanding Business Volume | |||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | ||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Total | ||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||
| As of: | |||||||||||||||||||||||||||||||||||
| June 30, 2026 | $ | 21,987,822 | $ | 2,082,762 | $ | 8,266,639 | $ | 1,851,902 | $ | 3,008,013 | $ | 37,197,138 | |||||||||||||||||||||||
| March 31, 2026 | 20,240,198 | 2,052,309 | 7,975,632 | 1,690,148 | 2,887,767 | 34,846,054 | |||||||||||||||||||||||||||||
| December 31, 2025 | 19,564,916 | 1,950,536 | 7,860,622 | 1,532,206 | 2,443,289 | 33,351,569 | |||||||||||||||||||||||||||||
| September 30, 2025 | 18,218,755 | 1,891,228 | 7,426,517 | 1,299,097 | 2,283,565 | 31,119,162 | |||||||||||||||||||||||||||||
| June 30, 2025 | 18,217,905 | 1,953,523 | 7,300,354 | 1,174,441 | 1,941,036 | 30,587,259 | |||||||||||||||||||||||||||||
| March 31, 2025 | 18,094,515 | 1,889,363 | 7,187,966 | 974,835 | 1,608,664 | 29,755,343 | |||||||||||||||||||||||||||||
| December 31, 2024 | 18,606,968 | 1,887,705 | 6,809,366 | 802,465 | 1,416,525 | 29,523,029 | |||||||||||||||||||||||||||||
| September 30, 2024 | 18,090,374 | 1,842,780 | 6,794,435 | 645,706 | 1,095,008 | 28,468,303 | |||||||||||||||||||||||||||||
| June 30, 2024 | 18,504,501 | 1,816,893 | 7,008,276 | 553,197 | 875,472 | 28,758,339 | |||||||||||||||||||||||||||||
Table 34
| On-Balance Sheet Outstanding Business Volume | |||||||||||||||||||||||
| Fixed Rate | 5- to 10-Year ARMs & Resets | 1-Month to 3-Year ARMs | Total Held in Portfolio | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| As of: | |||||||||||||||||||||||
| June 30, 2026 | $ | 15,897,521 | $ | 3,839,002 | $ | 11,434,387 | $ | 31,170,910 | |||||||||||||||
| March 31, 2026 | 14,822,103 | 3,693,296 | 10,428,336 | 28,943,735 | |||||||||||||||||||
| December 31, 2025 | 14,713,472 | 3,623,574 | 9,249,077 | 27,586,123 | |||||||||||||||||||
| September 30, 2025 | 14,600,861 | 3,529,567 | 7,724,118 | 25,854,546 | |||||||||||||||||||
| June 30, 2025 | 14,644,420 | 3,488,344 | 7,197,147 | 25,329,911 | |||||||||||||||||||
| March 31, 2025 | 14,397,557 | 3,393,642 | 6,892,411 | 24,683,610 | |||||||||||||||||||
| December 31, 2024 | 14,356,171 | 3,370,540 | 6,815,034 | 24,541,745 | |||||||||||||||||||
| September 30, 2024 | 14,328,691 | 3,311,001 | 6,265,792 | 23,905,484 | |||||||||||||||||||
| June 30, 2024 | 14,064,831 | 3,273,764 | 6,850,137 | 24,188,732 | |||||||||||||||||||
81
The following table presents outstanding Agricultural Finance mortgage loans and 90-day delinquencies as of June 30, 2026 by year of origination, geographic region, commodity/collateral type, original LTV ratio, and range in the size of borrower exposure:
Table 35
Agricultural Finance Mortgage Loans 90-Day Delinquencies as of June 30, 2026 | |||||||||||||||||||||||
| Distribution of Agricultural Loans | Agricultural Loans | 90-Day Delinquencies(1) | Percentage | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
| By year of origination: | |||||||||||||||||||||||
2016 and prior | 8 | % | $ | 1,169,576 | $ | 11,859 | 1.01 | % | |||||||||||||||
| 2017 | 3 | % | 419,341 | 4,579 | 1.09 | % | |||||||||||||||||
| 2018 | 4 | % | 525,623 | 8,384 | 1.60 | % | |||||||||||||||||
| 2019 | 4 | % | 665,096 | 14,676 | 2.21 | % | |||||||||||||||||
| 2020 | 12 | % | 1,820,361 | 6,421 | 0.35 | % | |||||||||||||||||
| 2021 | 16 | % | 2,378,860 | 19,600 | 0.82 | % | |||||||||||||||||
| 2022 | 10 | % | 1,461,479 | 31,448 | 2.15 | % | |||||||||||||||||
| 2023 | 6 | % | 921,795 | 20,559 | 2.23 | % | |||||||||||||||||
| 2024 | 10 | % | 1,559,303 | 15,198 | 0.97 | % | |||||||||||||||||
| 2025 | 16 | % | 2,452,544 | 4,974 | 0.20 | % | |||||||||||||||||
| 2026 | 11 | % | 1,592,553 | 1,430 | 0.09 | % | |||||||||||||||||
| Total | 100 | % | $ | 14,966,531 | $ | 139,128 | 0.93 | % | |||||||||||||||
By geographic region(2): | |||||||||||||||||||||||
| Northwest | 11 | % | $ | 1,621,858 | $ | 32,937 | 2.03 | % | |||||||||||||||
| Southwest | 25 | % | 3,746,737 | 66,100 | 1.76 | % | |||||||||||||||||
| Mid-North | 26 | % | 3,936,601 | 28,391 | 0.72 | % | |||||||||||||||||
| Mid-South | 22 | % | 3,289,384 | 5,593 | 0.17 | % | |||||||||||||||||
| Northeast | 4 | % | 625,090 | 2,799 | 0.45 | % | |||||||||||||||||
| Southeast | 12 | % | 1,746,861 | 3,308 | 0.19 | % | |||||||||||||||||
| Total | 100 | % | $ | 14,966,531 | $ | 139,128 | 0.93 | % | |||||||||||||||
| By commodity/collateral type: | |||||||||||||||||||||||
| Crops | 50 | % | $ | 7,534,913 | $ | 59,900 | 0.79 | % | |||||||||||||||
| Permanent plantings | 18 | % | 2,617,272 | 46,953 | 1.79 | % | |||||||||||||||||
| Livestock | 21 | % | 3,207,818 | 14,689 | 0.46 | % | |||||||||||||||||
| Part-time farm | 3 | % | 487,782 | 9,281 | 1.90 | % | |||||||||||||||||
| Ag. Storage and Processing | 8 | % | 1,112,798 | 8,305 | 0.75 | % | |||||||||||||||||
| Other | — | % | 5,948 | — | — | % | |||||||||||||||||
| Total | 100 | % | $ | 14,966,531 | $ | 139,128 | 0.93 | % | |||||||||||||||
| By original loan-to-value ratio: | |||||||||||||||||||||||
| Less than 40.00% | 16 | % | $ | 2,440,295 | $ | 10,520 | 0.43 | % | |||||||||||||||
| 40.00% to 60.00% | 53 | % | 7,860,469 | 97,512 | 1.24 | % | |||||||||||||||||
| 60.01% to 80.00% | 24 | % | 3,657,453 | 22,791 | 0.62 | % | |||||||||||||||||
| 80.01% to 100% | — | % | 23,181 | — | — | % | |||||||||||||||||
| Greater than 100% | — | % | 3,604 | — | — | % | |||||||||||||||||
Enterprise Value(3) | 7 | % | 981,529 | 8,305 | 0.85 | % | |||||||||||||||||
| Total | 100 | % | $ | 14,966,531 | $ | 139,128 | 0.93 | % | |||||||||||||||
By size of borrower exposure(4): | |||||||||||||||||||||||
| Less than $1,000,000 | 24 | % | $ | 3,655,942 | $ | 17,063 | 0.47 | % | |||||||||||||||
| $1,000,000 to $4,999,999 | 42 | % | 6,291,134 | 44,826 | 0.71 | % | |||||||||||||||||
| $5,000,000 to $9,999,999 | 15 | % | 2,210,255 | 62,665 | 2.84 | % | |||||||||||||||||
| $10,000,000 to $24,999,999 | 12 | % | 1,727,025 | 14,574 | 0.84 | % | |||||||||||||||||
| $25,000,000 and greater | 7 | % | 1,082,175 | — | — | % | |||||||||||||||||
| Total | 100 | % | $ | 14,966,531 | $ | 139,128 | 0.93 | % | |||||||||||||||
(1)Includes loans held and loans underlying off-balance sheet Farmer Mac Guaranteed Securities and LTSPCs that are 90 days or more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.
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(2)Geographic regions: Northwest (AK, ID, MT, OR, WA, WY); Southwest (AZ, CA, CO, HI, NM, NV, UT); Mid-North (IA, IL, IN, MI, MN, NE, ND, SD, WI); Mid-South (AR, KS, LA, MO, OK, TX); Northeast (CT, DE, KY, MA, MD, ME, NH, NJ, NY, OH, PA, RI, VA, VT, WV); Southeast (AL, FL, GA, MS, NC, SC, TN).
(3)"Enterprise Value" loans are generally secured by all business assets and common stock (in addition to first lien mortgages) of the borrower and the value of the borrowing entity depends on its ability to generate recurring positive cash flow.
(4)Includes aggregated loans to single borrowers or borrower-related entities.
The following table presents our cumulative net credit losses relative to the cumulative original balance for all Agricultural Finance mortgage loans as of June 30, 2026 by year of origination, geographic region, and commodity/collateral type. The purpose of this table is to present information about realized credit losses relative to original Agricultural Finance purchases, guarantees, and commitments.
Table 36
| Agricultural Finance Mortgage Loans Credit Losses Relative to Cumulative | |||||||||||||||||
Original Loans, Guarantees, and LTSPCs as of June 30, 2026 | |||||||||||||||||
| Cumulative Original Loans, Guarantees and LTSPCs | Cumulative Net Credit Losses/(Recoveries) | Cumulative Loss Rate | |||||||||||||||
| (dollars in thousands) | |||||||||||||||||
| By year of origination: | |||||||||||||||||
| 2016 and prior | $ | 22,943,734 | $ | 34,943 | 0.15 | % | |||||||||||
| 2017 | 1,780,180 | 4,310 | 0.24 | % | |||||||||||||
| 2018 | 1,540,315 | — | — | % | |||||||||||||
| 2019 | 1,758,163 | 1,687 | 0.10 | % | |||||||||||||
| 2020 | 3,376,510 | (87) | — | % | |||||||||||||
| 2021 | 3,738,440 | 19,330 | 0.52 | % | |||||||||||||
| 2022 | 2,205,837 | 2,140 | 0.10 | % | |||||||||||||
| 2023 | 1,516,110 | 3,019 | 0.20 | % | |||||||||||||
| 2024 | 1,941,979 | — | — | % | |||||||||||||
| 2025 | 2,782,060 | — | — | % | |||||||||||||
| 2026 | 1,658,648 | — | — | % | |||||||||||||
| Total | $ | 45,241,976 | $ | 65,342 | 0.14 | % | |||||||||||
By geographic region(1): | |||||||||||||||||
| Northwest | $ | 5,329,526 | $ | 16,885 | 0.32 | % | |||||||||||
| Southwest | 13,808,573 | 17,396 | 0.13 | % | |||||||||||||
| Mid-North | 11,203,697 | 29,437 | 0.26 | % | |||||||||||||
| Mid-South | 7,758,349 | (613) | (0.01) | % | |||||||||||||
| Northeast | 2,300,212 | 1,265 | 0.05 | % | |||||||||||||
| Southeast | 4,841,619 | 972 | 0.02 | % | |||||||||||||
| Total | $ | 45,241,976 | $ | 65,342 | 0.14 | % | |||||||||||
| By commodity/collateral type: | |||||||||||||||||
| Crops | $ | 20,972,838 | $ | 7,164 | 0.03 | % | |||||||||||
| Permanent plantings | 8,958,072 | 15,799 | 0.18 | % | |||||||||||||
| Livestock | 10,253,699 | 3,814 | 0.04 | % | |||||||||||||
| Part-time farm | 2,045,941 | 1,132 | 0.06 | % | |||||||||||||
| Ag. Storage and Processing | 2,854,635 | 37,433 | 1.31 | % | |||||||||||||
| Other | 156,791 | — | — | % | |||||||||||||
| Total | $ | 45,241,976 | $ | 65,342 | 0.14 | % | |||||||||||
(1)Geographic regions: Northwest (AK, ID, MT, OR, WA, WY); Southwest (AZ, CA, CO, HI, NM, NV, UT); Mid-North (IA, IL, IN, MI, MN, NE, ND, SD, WI); Mid-South (AR, KS, LA, MO, OK, TX); Northeast (CT, DE, KY, MA, MD, ME, NH, NJ, NY, OH, PA, RI, VA, VT, WV); Southeast (AL, FL, GA, MS, NC, SC, TN).
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The following table presents the quarterly net effective spread (a non-GAAP measure) by segment:
Table 37
| Net Effective Spread | |||||||||||||||||||||||||||||||||||||||||||||||
| Agricultural Finance | Infrastructure Finance | Treasury | |||||||||||||||||||||||||||||||||||||||||||||
| Farm & Ranch | Corporate AgFinance | Power & Utilities | Broadband Infrastructure | Renewable Energy | Funding | Investments | Net Effective Spread | ||||||||||||||||||||||||||||||||||||||||
| Dollars Yield | Dollars Yield | Dollars Yield | Dollars Yield | Dollars Yield | Dollars Yield | Dollars Yield | Dollars Yield | ||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| For the quarter ended: | |||||||||||||||||||||||||||||||||||||||||||||||
| June 30, 2026 | $ | 40,063 | $ | 16,769 | $ | 6,962 | $ | 6,578 | $ | 10,773 | $ | 35,229 | $ | 1,064 | $ | 117,438 | |||||||||||||||||||||||||||||||
| 1.01 | % | 3.76 | % | 0.36 | % | 2.30 | % | 1.72 | % | 0.38 | % | 0.05 | % | 1.26 | % | ||||||||||||||||||||||||||||||||
| March 31, 2026 | 37,673 | 8,939 | 6,491 | 5,828 | 9,079 | 32,647 | 1,342 | 101,999 | |||||||||||||||||||||||||||||||||||||||
| 1.03 | % | 2.05 | % | 0.35 | % | 2.27 | % | 1.59 | % | 0.37 | % | 0.07 | % | 1.16 | % | ||||||||||||||||||||||||||||||||
| December 31, 2025 | 36,180 | 8,601 | 6,159 | 5,610 | 8,995 | 33,694 | 2,150 | 101,389 | |||||||||||||||||||||||||||||||||||||||
| 1.06 | % | 2.07 | % | 0.34 | % | 2.42 | % | 1.74 | % | 0.41 | % | 0.11 | % | 1.22 | % | ||||||||||||||||||||||||||||||||
| September 30, 2025 | 34,840 | 9,047 | 5,910 | 4,379 | 7,730 | 34,777 | 1,086 | 97,769 | |||||||||||||||||||||||||||||||||||||||
| 1.04 | % | 2.16 | % | 0.34 | % | 2.30 | % | 1.75 | % | 0.43 | % | 0.05 | % | 1.20 | % | ||||||||||||||||||||||||||||||||
| June 30, 2025 | 35,710 | 8,609 | 5,636 | 3,932 | 6,227 | 31,668 | 2,111 | 93,893 | |||||||||||||||||||||||||||||||||||||||
| 1.07 | % | 2.07 | % | 0.33 | % | 2.24 | % | 1.68 | % | 0.40 | % | 0.11 | % | 1.19 | % | ||||||||||||||||||||||||||||||||
| March 31, 2025 | 33,885 | 8,640 | 5,329 | 3,566 | 5,112 | 31,604 | 1,854 | 89,990 | |||||||||||||||||||||||||||||||||||||||
| 1.01 | % | 2.09 | % | 0.32 | % | 2.27 | % | 1.55 | % | 0.41 | % | 0.10 | % | 1.17 | % | ||||||||||||||||||||||||||||||||
| December 31, 2024 | 32,556 | 7,891 | 5,059 | 3,414 | 4,859 | 31,242 | 2,507 | 87,528 | |||||||||||||||||||||||||||||||||||||||
| 0.96 | % | 1.95 | % | 0.32 | % | 2.34 | % | 1.76 | % | 0.42 | % | 0.15 | % | 1.16 | % | ||||||||||||||||||||||||||||||||
| September 30, 2024 | 35,755 | 6,397 | 4,785 | 2,794 | 3,810 | 30,912 | 943 | 85,396 | |||||||||||||||||||||||||||||||||||||||
| 1.05 | % | 1.56 | % | 0.30 | % | 2.21 | % | 1.78 | % | 0.42 | % | 0.05 | % | 1.16 | % | ||||||||||||||||||||||||||||||||
| June 30, 2024 | 34,156 | 7,866 | 5,253 | 2,393 | 2,999 | 30,268 | 661 | 83,596 | |||||||||||||||||||||||||||||||||||||||
| 0.98 | % | 1.91 | % | 0.32 | % | 2.16 | % | 1.86 | % | 0.41 | % | 0.04 | % | 1.14 | % | ||||||||||||||||||||||||||||||||
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The following table presents quarterly core earnings (a non-GAAP measure) reconciled to net income attributable to common stockholders (in thousands):
Table 38
| Core Earnings by Quarter Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||
June 2026 | March 2026 | December 2025 | September 2025 | June 2025 | March 2025 | December 2024 | September 2024 | June 2024 | |||||||||||||||||||||||||||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net effective spread | $ | 117,438 | $ | 101,999 | $ | 101,389 | $ | 97,769 | $ | 93,893 | $ | 89,990 | $ | 87,528 | $ | 85,396 | $ | 83,596 | |||||||||||||||||||||||||||||||||||
| Guarantee and commitment fees | 7,044 | 6,715 | 6,298 | 6,132 | 5,874 | 5,488 | 5,086 | 4,997 | 5,256 | ||||||||||||||||||||||||||||||||||||||||||||
| Other | 742 | 1,185 | 224 | 1,185 | 742 | 1,315 | (491) | 1,133 | 386 | ||||||||||||||||||||||||||||||||||||||||||||
| Total revenues | 125,224 | 109,899 | 107,911 | 105,086 | 100,509 | 96,793 | 92,123 | 91,526 | 89,238 | ||||||||||||||||||||||||||||||||||||||||||||
| Credit related expense/(income): | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Provision for/(release of) losses | 7,017 | 4,308 | 15,986 | 7,477 | 7,713 | 1,684 | 3,773 | 3,428 | 6,179 | ||||||||||||||||||||||||||||||||||||||||||||
Other credit related expense/(income) | 352 | 889 | 1,267 | (44) | 160 | (33) | 99 | 26 | 51 | ||||||||||||||||||||||||||||||||||||||||||||
| Total credit related expense/(income) | 7,369 | 5,197 | 17,253 | 7,433 | 7,873 | 1651 | 3872 | 3454 | 6,230 | ||||||||||||||||||||||||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Compensation and employee benefits | 23,706 | 21,257 | 18,199 | 17,743 | 17,631 | 17,752 | 15,641 | 15,237 | 14,840 | ||||||||||||||||||||||||||||||||||||||||||||
| General and administrative | 11,591 | 11,262 | 11,944 | 11,052 | 10,859 | 10,758 | 12,452 | 8,625 | 8,904 | ||||||||||||||||||||||||||||||||||||||||||||
| Regulatory fees | 862 | 863 | 863 | 1,000 | 1,000 | 1,000 | 1,000 | 725 | 725 | ||||||||||||||||||||||||||||||||||||||||||||
| Total operating expenses | 36,159 | 33,382 | 31,006 | 29,795 | 29,490 | 29,510 | 29,093 | 24,587 | 24,469 | ||||||||||||||||||||||||||||||||||||||||||||
| Net earnings | 81,696 | 71,320 | 59,652 | 67,858 | 63,146 | 65,632 | 59,158 | 63,485 | 58,539 | ||||||||||||||||||||||||||||||||||||||||||||
| Income tax expense | 14,856 | 12,288 | 12,370 | 11,933 | 10,114 | 14,000 | 9,938 | 12,681 | 11,970 | ||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock dividends | 8,074 | 7,291 | 7,286 | 6,303 | 5,667 | 5,666 | 5,666 | 5,897 | 6,792 | ||||||||||||||||||||||||||||||||||||||||||||
| Core earnings | $ | 58,766 | $ | 51,741 | $ | 39,996 | $ | 49,622 | $ | 47,365 | $ | 45,966 | $ | 43,554 | $ | 44,907 | $ | 39,777 | |||||||||||||||||||||||||||||||||||
| Reconciling items: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gains/(losses) on undesignated financial derivatives due to fair value changes | $ | 184 | $ | (679) | $ | 447 | $ | 882 | $ | (639) | $ | (2,573) | $ | 3,084 | $ | (1,064) | $ | (359) | |||||||||||||||||||||||||||||||||||
Gains/(losses) on hedging activities due to fair value changes | 889 | 362 | 3,107 | (137) | 2,709 | 1,099 | 5,737 | 205 | 2,604 | ||||||||||||||||||||||||||||||||||||||||||||
Unrealized gains/(losses) on trading assets | 59 | 53 | (66) | (4) | (65) | 9 | (83) | 99 | (87) | ||||||||||||||||||||||||||||||||||||||||||||
| Net effects of amortization of premiums/discounts and deferred gains on assets consolidated at fair value | 26 | 44 | 24 | 26 | 25 | 28 | (39) | 27 | 26 | ||||||||||||||||||||||||||||||||||||||||||||
| Net effects of terminations or net settlements on financial derivatives | (1,017) | 335 | (2,699) | (1,934) | 255 | (1,070) | 534 | (503) | (1,505) | ||||||||||||||||||||||||||||||||||||||||||||
| Issuance costs on the retirement of preferred stock | — | — | — | — | — | — | — | (1,619) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Income tax effect related to reconciling items | (30) | (24) | (171) | 245 | (480) | 526 | (1,939) | 260 | (143) | ||||||||||||||||||||||||||||||||||||||||||||
| Net income attributable to common stockholders | $ | 58,877 | $ | 51,832 | $ | 40,638 | $ | 48,700 | $ | 49,170 | $ | 43,985 | $ | 50,848 | $ | 42,312 | $ | 40,313 | |||||||||||||||||||||||||||||||||||
85
Item 3.Quantitative and Qualitative Disclosures About Market Risk
We are exposed to market risk from changes in interest rates. We manage this market risk by entering into various financial transactions, including financial derivatives, and by monitoring and measuring our exposure to changes in interest rates. See MD&A—Risk Management—Interest Rate Risk for information about our exposure to interest rate risk and strategies to manage that risk. For information about our use of financial derivatives and related accounting policies, see Note 3—Financial Derivatives to the consolidated financial statements.
Item 4.Controls and Procedures
Management's Evaluation of Disclosure Controls and Procedures. Farmer Mac maintains disclosure controls and procedures designed to ensure that information required to be disclosed in its periodic filings under the Securities Exchange Act of 1934 ("Exchange Act"), including this Annual Report on Form 10-K, is recorded, processed, summarized, and reported on a timely basis. These disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed under the Exchange Act is accumulated and communicated to Farmer Mac's management on a timely basis to allow decisions about required disclosure. Management, including Farmer Mac's principal executive officer and principal financial officer, has evaluated the effectiveness of the design and operation of Farmer Mac's disclosure controls and procedures (as defined under Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of June 30, 2026.
Farmer Mac carried out the evaluation of the effectiveness of its disclosure controls and procedures, required by paragraph (b) of Exchange Act Rules 13a-15 and 15d-15, under the supervision and with the participation of management, including the principal executive officer and principal financial officer. Based on this evaluation, the principal executive officer and principal financial officer concluded that Farmer Mac's disclosure controls and procedures were effective as of June 30, 2026.
Changes in Internal Control Over Financial Reporting. There were no changes in Farmer Mac's internal control over financial reporting during the quarter ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, Farmer Mac's internal control over financial reporting.
86
PART II
Item 1.Legal Proceedings
None.
Item 1A.Risk Factors
Information about risk factors can be found in "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Forward-Looking Statements" in Part I, Item 2 of this Form 10-Q and in Part I, Item 1A of Farmer Mac’s 2025 Annual Report.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
(a) Farmer Mac is a federally chartered instrumentality of the United States whose debt and equity securities are exempt from registration under Section 3(a)(2) of the Securities Act of 1933. During the second quarter 2026, the following transactions occurred related to Farmer Mac's equity securities that were not registered under the Securities Act of 1933 and were not otherwise reported on a Current Report on Form 8-K:
Class C Non-Voting Common Stock. Under Farmer Mac's policy that permits directors of Farmer Mac to elect to receive shares of Class C non-voting common stock in lieu of their cash retainers, Farmer Mac issued an aggregate of 415 shares of its Class C non-voting common stock in April 2026 to the seven directors who elected to receive stock in lieu of their cash retainers. Farmer Mac calculated the number of shares issued to the directors based on a price of $148.35 per share, which was the closing price of the Class C non-voting common stock on March 31, 2026 (the last trading day of the previous quarter) as reported by the New York Stock Exchange.
(b) Not applicable.
(c) None.
Item 3.Defaults Upon Senior Securities
(a) None.
(b) None.
Item 4.Mine Safety Disclosures
Not applicable.
87
Item 5.Other Information
Director and Officer Trading Arrangements
None of Farmer Mac's directors or executive officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted terminated
Item 6.Exhibits
88
| * | 3.1 | — | Title VIII of the Farm Credit Act of 1971, as most recently amended on June 18, 2020 (Previously filed as Exhibit 3.1 to Form 10-Q filed August 10, 2020). | |||||||||||||||||
* | 3.2 | — | Amended and Restated By-Laws of the Registrant (Previously filed as Exhibit 3.1 to Form 8-K filed February 2, 2026). | |||||||||||||||||
| * | 4.1 | — | Specimen Certificate for Farmer Mac Class A Voting Common Stock (Previously filed as Exhibit 4.1 to Form 10-Q filed May 15, 2003). | |||||||||||||||||
| * | 4.2 | — | Specimen Certificate for Farmer Mac Class B Voting Common Stock (Previously filed as Exhibit 4.2 to Form 10-Q filed May 15, 2003). | |||||||||||||||||
| * | 4.3 | — | Specimen Certificate for Farmer Mac Class C Non-Voting Common Stock (Previously filed as Exhibit 4.3 to Form 10-Q filed May 15, 2003). | |||||||||||||||||
| * | 4.4 | — | Specimen Certificate for 5.700% Non-Cumulative Preferred Stock, Series D (Previously filed as Exhibit 4.7 to Form 10-Q filed August 1, 2019). | |||||||||||||||||
| * | 4.4.1 | — | Certificate of Designation of Terms and Conditions of 5.700% Non-Cumulative Preferred Stock, Series D (Previously filed as Exhibit 4.1 to Form 8-A filed May 13, 2019). | |||||||||||||||||
| * | 4.5 | — | Specimen Certificate for 5.750% Non-Cumulative Preferred Stock, Series E (Previously filed as Exhibit 4.7 to Form 10-Q filed August 10, 2020). | |||||||||||||||||
| * | 4.5.1 | — | Certificate of Designation of Terms and Conditions of 5.750% Non-Cumulative Preferred Stock, Series E (Previously filed as Exhibit 4.1 to Form 8-A filed May 20, 2020). | |||||||||||||||||
| * | 4.6 | — | Specimen Certificate for 5.250% Non-Cumulative Preferred Stock, Series F (Previously filed as Exhibit 4.8 to Form 10-Q filed November 9, 2020). | |||||||||||||||||
| * | 4.6.1 | — | Certificate of Designation of Terms and Conditions of 5.250% Non-Cumulative Preferred Stock, Series F (Previously filed as Exhibit 4.1 to Form 8-A filed August 20, 2020). | |||||||||||||||||
| * | 4.7 | — | Specimen Certificate for 4.875% Non-Cumulative Preferred Stock, Series G (Previously filed as Exhibit 4.8 to Form 10-Q filed August 5, 2021). | |||||||||||||||||
| * | 4.7.1 | — | Certificate of Designation of Terms and Conditions of 4.875% Non-Cumulative Preferred Stock, Series G (Previously filed as Exhibit 4.1 to Form 8-A filed May 27, 2021). | |||||||||||||||||
* | 4.8 | Specimen Certificate for 6.500% Non-Cumulative Preferred Stock, Series H (Previously filed as Exhibit 4.8 to Form 10-Q filed November 3, 2025). | ||||||||||||||||||
| * | 4.8.1 | Certificate of Designation of Terms and Conditions of 6.500% Non-Cumulative Preferred Stock, Series H (Previously filed as Exhibit 4.1 to Form 8-A filed August 25, 2025). | ||||||||||||||||||
| ** | 4.9 | Specimen Certificate for 6.875% Non-Cumulative Preferred Stock, Series I. | ||||||||||||||||||
| * | 4.9.1 | Certificate of Designation of Terms and Conditions of 6.875% Non-Cumulative Preferred Stock, Series I (Previously filed as Exhibit 4.1 to Form 8-A filed May 19, 2026). | ||||||||||||||||||
| ** | 4.10 | — | Description of the Registrant's securities that are registered under Section 12 of the Securities Exchange Act of 1934. | |||||||||||||||||
| * | 10.1 | Third Amendment to Amended Employment Agreement between Farmer Mac and Bradford T. Nordholm dated June 3, 2026. (Previously filed as Exhibit 10.1 to Form 8-K filed June 8, 2026). | ||||||||||||||||||
| ** | 31.1 | — | Certification of Registrant's principal executive officer relating to the Registrant's Annual Report on Form 10-Q for the quarter ended March 31, 2026, pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||||||||||||||
| ** | 31.2 | — | Certification of Registrant's principal financial officer relating to the Registrant's Annual Report on Form 10-Q for the quarter ended March 31, 2026, pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||||||||||||||
| ** | 32 | — | Certification of Registrant's principal executive officer and principal financial officer relating to the Registrant's Annual Report on Form 10-Q for the quarter ended March 31, 2026, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||||||||||||||
| ** | 101.INS | — | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||||||||||||
| ** | 101.SCH | — | Inline XBRL Taxonomy Extension Schema | |||||||||||||||||
| ** | 101.CAL | — | Inline XBRL Taxonomy Extension Calculation | |||||||||||||||||
| ** | 101.DEF | — | Inline XBRL Taxonomy Extension Definition | |||||||||||||||||
| ** | 101.LAB | — | Inline XBRL Taxonomy Extension Label | |||||||||||||||||
| ** | 101.PRE | — | Inline XBRL Taxonomy Extension Presentation | |||||||||||||||||
| ** | 104 | — | Cover Page Inline Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document included as Exhibit 101 | |||||||||||||||||
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| * | Incorporated by reference to the indicated prior filing. | ||||
| ** | Filed with this report. | ||||
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
| /s/ Zachary N. Carpenter | July 30, 2026 | ||||||||||
| By: | Zachary N. Carpenter | ||||||||||
| President and Chief Executive Officer | |||||||||||
| (Principal Executive Officer) | |||||||||||
/s/ Matthew M. Pullins | July 30, 2026 | ||||||||||
| By: | Matthew M. Pullins | ||||||||||
Executive Vice President – Chief Financial Officer and Treasurer | |||||||||||
(Principal Financial Officer) | |||||||||||
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