UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 18, 2002
Federal Agricultural Mortgage Corporation
----------------------------------------------
(Exact name of registrant as specified in its charter)
Federally chartered
instrumentality of
the United States 0-17440 52-1578738
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(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
1133 Twenty-First Street, N.W., Suite 600, Washington, D.C. 20036
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (202) 872-7700
No change
--------------------
(Former name or former address, if changed since last report)
Item 7. Financial Statements and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits:
99 Press release dated July 18, 2002.
Item 9. Regulation FD Disclosure.
On July 18, 2002, the Registrant issued a press release to announce the
Registrant's financial results for second quarter 2002. The press release is
filed as Exhibit 99 hereto and incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FEDERAL AGRICULTURAL
MORTGAGE CORPORATION
By: /s/ Jerome G. Oslick
-------------------------
Name: Jerome G. Oslick
Title: Vice President - General Counsel
Dated: July 19, 2002
EXHIBIT INDEX
Exhibit No. Description Page No.
99 Press Release Dated July 18, 2002 5
NEWS
FOR IMMEDIATE RELEASE CONTACT
July 18, 2002 Jerome Oslick
202-872-7700
Farmer Mac Achieves Record Earnings
Operating Earnings Per Share Up 50%
Washington, D.C. -- The Federal Agricultural Mortgage Corporation (Farmer
Mac, NYSE: AGM and AGMA) today announced that it achieved record earnings for
its second quarter, ended June 30, 2002. Diluted operating earnings per share
grew to $0.48, a 50 percent increase over second quarter 2001 diluted operating
earnings per share of $0.32. Operating income for the second quarter 2002
reached $5.8 million and $11.1 million for the year-to-date, compared to $3.7
million and $6.9 million for the same periods in 2001. Operating income,
revenues and earnings per share are measures that exclude the effects of
Statement of Financial Accounting Standards No. 133, Accounting for Derivative
Instruments and Hedging Activities ("FAS 133") and the net after-tax
extraordinary gain of $0.6 million recognized on the repurchase of a portion of
the Company's debt in second quarter 2002. Net income for second quarter 2002,
including the effects of FAS 133 and the extraordinary gain, was $6.3 million or
$0.52 per diluted share.
Farmer Mac President and Chief Executive Officer Henry D. Edelman stated,
"We are extremely pleased with the growth and performance of Farmer Mac as it
achieved record operating earnings of $0.48 per share. During the quarter,
Farmer Mac added $1.3 million to its loss reserves, loss experience and
delinquencies are consistent with our expectations and our guarantee business
continues to grow. In the quarter, we completed $890 million of guarantee
business and our guarantees outstanding surpassed the $5 billion mark for the
first time. This growth of our guarantee business, important as it is in
enhancing lenders' liquidity and loan capacity, truly underscores the value that
we provide for America's farmers, ranchers and agricultural lenders - increased
availability of long-term mortgage financing at competitive rates. We believe
that Farmer Mac is on track to meet or exceed the market analyst's current
projection for its financial performance in 2002.
"Since the middle of the second quarter we have been subject to the efforts
of admitted short sellers to depress the price of Farmer Mac's securities for
their own gain. The activities of these short sellers have caused a substantial
loss in stockholder value over a relatively compressed period of time -
something that cannot be explained by any business development. Responding to
the attention that has been focused on Farmer Mac, the Senate Agriculture
Committee has sought the General Accounting Office's assistance `to ensure that
Farmer Mac's mission continues to be met in a financially sound manner.' We
welcome that investigation for the objective review it should afford us. Farmer
Mac, unlike many companies, is subject to examination of its operations, as well
as related internal controls, by a federal regulator that examines the Company
with full access to all related information. Furthermore, we now have in place a
risk-based capital ("RBC") standard that measures our capital adequacy,
providing assurance that we stay within the risk parameters that the Congress
expected of us. The Board and management are fully committed to building the
value of Farmer Mac for our stockholders and the country's agricultural sector."
Net Interest Income
Net interest income was $8.9 million for second quarter 2002 and $16.4
million year-to-date, compared to $6.4 million and $11.9 million for the same
periods in 2001. The net interest yield, which does not include guarantee fees
for loans purchased prior to April 1, 2001 (the effective date of Statement of
Financial Accounting Standards No. 140, Accounting for Transfers and Servicing
of Financial Assets and Extinguishments of Liabilities ("FAS 140")), was 93
basis points for second quarter 2002, compared to 89 basis points for first
quarter 2002 and 82 basis points for second quarter 2001. The net interest
yields for second quarter 2002, first quarter 2002 and second quarter 2001
included the benefits of yield maintenance payments of 7 basis points, 7 basis
points and 4 basis points, respectively. The effect of the adoption of FAS 140
for the second quarter 2002 was a reclassification of approximately $0.7 million
(7 basis points) of guarantee fee income as interest income. Adjusted for the
effects of yield maintenance and excluding the effects of FAS 140, the net
interest yields for second quarter 2002, first quarter 2002 and second quarter
2001 were 79 basis points, 82 basis points and 78 basis points, respectively.
Guarantee Fees
Guarantee fees were $4.7 million for second quarter 2002, compared to $4.6
million for first quarter 2002 and $3.7 million for second quarter 2001. The
relative increase in guarantee fees reflects an increase in the average balance
of outstanding guarantees. Excluding the effects of the adoption of FAS 140 that
reclassified $0.7 million of guarantee fee income as interest income, guarantee
fees for second quarter 2002 would have been $5.4 million.
Operating Expenses
Operating expenses totaled $3.0 million in the second quarter of 2002,
compared to $2.5 million for first quarter 2002 and $2.8 million for second
quarter 2001. The increase in operating expenses in second quarter 2002
primarily reflects an increase in legal and consulting fees. Operating expenses
as a percentage of operating revenues were 22 percent for second quarter 2002,
compared to 21 percent for first quarter 2002 and 28 percent for second quarter
2001.
Extraordinary Item
During second quarter 2002, Farmer Mac recognized a net after-tax
extraordinary gain of $0.6 million resulting from the repurchase of $18.9
million of outstanding Farmer Mac debt.
Credit
As of June 30, 2002, Farmer Mac I loans purchased or guaranteed after the
enactment in 1996 of changes to Farmer Mac's statutory charter ("post-1996 Act
loans") covered by a Farmer Mac guarantee, both on- and off-balance sheet, that
were 90 days or more past due, in foreclosure, in bankruptcy and REO (real
estate owned) totaled $60.4 million and represented 1.35 percent of the
principal balance of all post-1996 Act loans, compared to $87.1 million (2.32
percent) as of March 31, 2002, $58.3 million (1.70 percent) as of December 31,
2001, and $53.1 million (1.72 percent) as of June 30, 2001. (Farmer Mac assumes
100 percent of the credit risk on post-1996 Act loans; pre-1996 Act loans are
supported by mandatory 10 percent subordinated interests that mitigate Farmer
Mac's credit exposure.) From quarter to quarter, Farmer Mac anticipates
fluctuations in the delinquencies, both in dollars and as a percentage of the
outstanding portfolio, with higher levels likely at the end of the first and
third quarters of each year due to the semi-annual payment characteristics of
most Farmer Mac loans. The year-over-year increase in dollars is reflective of
the continued maturation of a significant segment of Farmer Mac's portfolio of
guarantees into its peak default years. The year-over-year decline in the ratio
of delinquencies to outstanding guarantees is reflective of the growth of the
portfolio.
Farmer Mac conducts a loan-by-loan analysis of its delinquencies to assess
the value of the collateral supporting each individual loan relative to the
total amount due, including principal, interest and advances. In the event that
the updated or discounted collateral value does not support the total amount
due, Farmer Mac specifically allocates reserves to the loan. Farmer Mac charges
off losses against the reserve for losses when management believes a loss has
occurred, but no later than when the Company takes possession of the property.
As of June 30, 2002, Farmer Mac's loan-by-loan analysis of its $60.4 million of
delinquent loans and their updated or discounted collateral values indicated
that $14.4 million have insufficient collateral to cover the loan balance,
accrued interest and expenses. Farmer Mac has specifically allocated $2.8
million of reserves to those under-collateralized loans. Farmer Mac's
loan-by-loan analyses indicated that the remaining $46.0 million of delinquent
loans were adequately collateralized, based on updated or discounted collateral
values, and that the allocation of specific reserves to those loans was not
necessary. As of June 30, 2002, after the allocation of specific reserves to
under-collateralized loans, Farmer Mac had additional non-specific or general
reserves of $15.5 million, bringing total reserves to $18.3 million.
Based on Farmer Mac's loan-by-loan analyses, loan collection experience,
and continuing provisions for the reserve for losses, Farmer Mac believes that
ongoing losses will be covered adequately by the reserve for losses. During
second quarter 2002, Farmer Mac charged off $902,000 in losses against the
reserve for losses. In certain collateral liquidation scenarios, Farmer Mac may
recover amounts previously charged-off or incur additional losses, if
liquidation proceeds vary from previous estimates. As of June 30, 2002, the
weighted-average original loan-to-value ratio for all post-1996 Act loans was 49
percent, and the weighted-average original loan-to-value ratio for delinquent
loans was 57 percent. Farmer Mac's provision for losses was $2.0 million for
second quarter 2002, compared to $2.0 million for first quarter 2002 and $1.4
million for second quarter 2001. As of June 30, 2002, Farmer Mac's reserve for
losses totaled $18.3 million, or 41 basis points of the outstanding post-1996
Act loans and AMBS, compared to $17.0 million (45 basis points) as of March 31,
2002 and $13.2 million (43 basis points) as of June 30, 2001.
Provision for Income Taxes
The provision for income taxes totaled $2.6 million for second quarter 2002
and $5.1 million year-to-date, compared to $2.1 million and $3.7 million for the
same periods in 2001. Farmer Mac's effective tax rate for second quarter 2002
was 30.1 percent compared to 31.0 percent for first quarter 2002 and 33.1
percent for 2001. The reduction in the rate from the prior year reflects the
effects of certain tax-advantaged investment securities.
Capital
Farmer Mac's core capital totaled $176.2 million as of June 30, 2002,
compared to $126.0 million as of December 31, 2001 and $134.0 million as of
March 31, 2002. This increase reflects Farmer Mac's issuance of preferred stock
on May 6, 2002, which added $34.7 million to its core capital during second
quarter 2002. The regulatory methodology for calculating core capital excludes
the effects of Statement of Financial Accounting Standards No. 115, Accounting
for Certain Investments in Debt and Equity Securities ("FAS 115"), and FAS 133.
Farmer Mac's actual core capital balance as of June 30, 2002 exceeded the
statutory minimum capital requirement of $130.4 million by approximately $45.8
million.
The FCA issued its final risk-based capital regulation for Farmer Mac on
April 12, 2001 and the Company was required to meet the risk-based capital
standards beginning on May 23, 2002. We have maintained a dialogue with FCA
regarding the application of the regulation and the complex underlying economic
model. Farmer Mac is in compliance with the risk-based capital standards under
the regulation and we are confident that Farmer Mac will continue to be in
compliance.
The first application after the effective compliance date of the definitive
risk-based capital stress test promulgated by the FCA ("RBC test") showed that
Farmer Mac's actual regulatory capital of $194.5 million was $114.4 million in
excess of the $80.1 million risk-based capital requirement as of June 30, 2002.
That RBC requirement was also $50.3 million below the minimum capital
requirement of $130.4 million. The relevant measure for the RBC test is
regulatory capital, which under the regulatory methodology is core capital plus
loss reserves. Although the RBC test results show capital requirements below the
statutory minimum, we still need to hold the higher of the statutory minimum
capital requirement or the amount required to pass the RBC test.
Average return on common equity, excluding the effects of FAS 115, FAS 133
and the extraordinary item, was 16.9 percent for second quarter 2002, compared
to 13.8 percent for second quarter 2001 and 16.4 percent for first quarter 2002.
Interest Rate Risk
The most comprehensive measure of Farmer Mac's interest rate risk is the
sensitivity of our Market Value of Equity ("MVE") to parallel yield curve
shocks. As of June 30, 2002, a uniform or "parallel" increase of 100 basis
points across the entire U.S. Treasury yield curve would increase MVE by 3.6
percent, while a parallel decrease of 100 basis points would decrease MVE by 5.4
percent. Net Interest Income ("NII") sensitivity, a shorter-term measure of
interest rate risk, demonstrates a similar lack of exposure to interest rate
movements. As of June 30, 2002, a uniform or "parallel" increase of 100 basis
points would increase NII by 9.4 percent, while a parallel decrease of 100 basis
points would decrease NII by 8.6 percent. We also measure the sensitivity of
both MVE and NII to a variety of non-parallel interest rate shocks. MVE and NII
are even less sensitive to these non-parallel shocks. Finally, our duration gap,
a static measure of interest-rate risk, was minus 2.9 months as of June 30,
2002. Our MVE tests demonstrate the effectiveness of our asset-liability match
over the life of our assets and liabilities on a present value basis
The economic effects of derivatives, including interest rate swaps, is
included in our MVE analysis. Farmer Mac enters into contracts in which the
Company pays fixed rates of interest and receives floating rates of interest
from counterparties. These "floating-to-fixed interest rate swaps" are used to
adjust the characteristics of our short-term debt to match more closely the cash
flow and duration characteristics of our longer-term mortgages, thereby reducing
interest rate risk, and also to derive an overall lower effective fixed rate
cost of borrowing than would otherwise be available in the conventional debt
market. As of June 30, 2002, Farmer Mac had $675.1 million notional amount of
floating-to-fixed interest rate swaps for terms ranging from 2 to 15 years.
Farmer Mac uses derivative instruments as an end-user for hedging purposes,
not for speculative purposes. All of Farmer Mac's derivative transactions are
conducted through standard, collateralized agreements that limit Farmer Mac's
potential credit exposure to any counterparty. As of June 30, 2002, Farmer Mac
had no uncollateralized net exposure to any counterparty.
Derivatives and Financial Statement Effects of FAS 133
Farmer Mac accounts for its derivatives under FAS 133, which became
effective January 1, 2001. The implementation of FAS 133 resulted in significant
accounting changes to both the Company's income statement and balance sheet.
During second quarter 2002, the reduction in net after-tax income resulting from
FAS 133 was $149,500, and the net after-tax decrease in accumulated other
comprehensive income was $14.6 million. For first quarter 2002, the increase in
net after-tax income and the net after-tax increase in accumulated other
comprehensive income resulting from FAS 133 were $145,000 and $3.2 million,
respectively. For second quarter 2001, the reductions in net after-tax income
and accumulated other comprehensive income resulting from FAS 133 were $102,000,
and $3.3 million, respectively. Accumulated other comprehensive income is not a
component of Farmer Mac's regulatory core capital. Management believes that
reporting financial results by reference to operating income, revenues and
earnings per share (excluding the effects of FAS 133) provides a more accurate
comparison of Farmer Mac's financial performance to previous presentations.
Forward-Looking Statements
In addition to historical information, this release includes
forward-looking statements that reflect management's current expectations for
Farmer Mac's future financial results, business prospects and business
developments. Management's expectations for Farmer Mac's future necessarily
involve assumptions, estimates and the evaluation of risks and uncertainties.
Various factors could cause actual events or results to differ materially from
those expectations. Some of the important factors that could cause Farmer Mac's
actual results to differ materially from management's expectations include
uncertainties regarding: (1) the rate and direction of the development of the
secondary market for agricultural mortgage loans; (2) the effect on the
agricultural economy resulting from low commodity prices, weak demand for U.S.
agricultural products and crop damage from natural disasters; (3) the effect on
the agricultural economy of federal assistance for agriculture provided for in
the recently enacted farm bill; (4) the possible effect of the risk-based
capital requirement which could, under certain circumstances, be in excess of
the statutory minimum capital level; (5) the possible establishment of
additional statutory or regulatory restrictions on Farmer Mac, such as
restrictions on Farmer Mac's investment authority; (6) the outcome of the
pending investigation of Farmer Mac by the General Accounting Office; and (7)
Farmer Mac's continuing access to the debt markets at favorable rates and terms.
Other factors are discussed in Farmer Mac's Annual Report on Form 10-K for the
year ended December 31, 2001, as filed with the Securities and Exchange
Commission ("SEC") on March 27, 2002, Farmer Mac's Quarterly Report on Form 10-Q
for the quarter ended March 31, 2002, as filed with the SEC on May 15, 2002 and
Farmer Mac's Current Report on Form 8-K as filed with the SEC on May 30, 2002.
The forward-looking statements contained herein represent management's
expectations as of the date of this release. Farmer Mac undertakes no obligation
to release publicly the results of any revisions to the forward-looking
statements included herein to reflect events or circumstances after today, or to
reflect the occurrence of unanticipated events, except as otherwise mandated by
the SEC.
Farmer Mac is a stockholder-owned instrumentality of the United States
chartered by Congress to establish a secondary market for agricultural real
estate and rural housing mortgage loans, and to facilitate capital market
funding for USDA guaranteed farm program and rural development loans. Farmer
Mac's Class C and Class A common stocks are listed on the New York Stock
Exchange under the symbols AGM and AGMA, respectively. Additional information
about Farmer Mac (as well as the Form 10-K, Form 10-Q and Form 8-K referenced
above) is available on Farmer Mac's website at www.farmermac.com. The conference
call to discuss Farmer Mac's second quarter 2002 earnings and this press release
will be webcast on Farmer Mac's website beginning at 11:00 a.m. eastern time,
Friday, July 19, 2002, and an audio recording of that call will be available for
two weeks on Farmer Mac's website after the call is concluded.
Federal Agricultural Mortgage Corporation
Consolidated Balance Sheets
(in thousands)
June 30, December 31, June 30,
2002 2001 2001
--------------- ------------- --------------
(unaudited) (audited) (unaudited)
Assets:
Cash and cash equivalents $ 479,585 $ 437,831 $ 473,546
Investment securities 977,474 1,007,954 890,065
Farmer Mac guaranteed securities 1,655,356 1,690,376 1,698,207
Loans 837,102 199,355 79,089
Real estate owned 2,489 2,457 -
Financial derivatives 721 15 625
Interest receivable 63,076 56,253 48,851
Guarantee fees receivable 5,051 6,004 4,594
Prepaid expenses and other assets 16,720 16,963 14,104
Total assets $ 4,037,574 $3,417,208 $ 3,209,081
Liabilities and stockholders' equity:
Notes payable:
Due within one year $ 2,661,792 $2,233,267 $ 2,280,276
Due after one year 1,086,671 968,463 759,544
Total notes payable 3,748,463 3,201,730 3,039,820
Financial derivatives 35,035 20,762 14,767
Accrued interest payable 30,744 26,358 22,121
Accounts payable and accrued expenses 19,997 18,037 8,508
Reserve for losses 18,327 15,884 13,180
Total liabilities 3,852,566 3,282,771 3,098,396
Stockholders' equity 185,008 134,437 110,685
Total liabilities and stockholders' equity $ 4,037,574 $3,417,208 $ 3,209,081
Federal Agricultural Mortgage Corporation
Consolidated Statements of Operations
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
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June 30, June 30, June 30, June 30,
2002 2001 2002 2001
(unaudited) (unaudited) (unaudited) (unaudited)
Interest income:
Investments and cash equivalents $ 10,612 $ 17,148 $ 20,938 $ 38,236
Farmer Mac guaranteed securities 22,541 28,481 45,560 57,221
Loans 10,394 740 14,193 1,343
Total interest income 43,547 46,369 80,691 96,800
Interest expense 34,641 39,947 64,315 84,925
Net interest income 8,906 6,422 16,376 11,875
Gains/(Losses) on financial derivatives
and trading assets (230) (159) (6) (748)
Other income:
Guarantee fees 4,723 3,669 9,290 7,097
Miscellaneous 368 116 760 282
Total other income 5,091 3,785 10,050 7,379
Total revenues 13,767 10,048 26,420 18,506
Expenses:
Compensation and employee benefits 1,324 1,496 2,580 2,733
Regulatory fees 197 245 393 468
General and administrative 1,499 1,107 2,592 2,252
Total operating expenses 3,020 2,848 5,565 5,453
Provision for losses 2,022 1,394 4,038 2,777
Total expenses 5,042 4,242 9,603 8,230
Income before income taxes 8,725 5,806 16,817 10,276
Income tax provision 2,630 2,091 5,135 3,679
Net income before cumulative effect 6,095 3,715 11,682 6,597
of change in accounting principles and
extraordinary item
Cumulative effect of change - - - (726)
in accounting principles, net of tax
Extraordinary gain, net of tax 583 - 2,203 -
Net income 6,678 3,715 13,885 5,871
Preferred stock dividends 336 - 336 -
Net income available to common stockholders $ 6,342 $ 3,715 $ 13,549 $ 5,871
Earnings per share:
Basic earnings per share $ 0.55 $ 0.33 $ 1.17 $ 0.52
Diluted earnings per share $ 0.52 $ 0.32 $ 1.12 $ 0.50
Earnings per share before cumulative
effect of change in accounting principles
and extraordinary item:
Basic earnings per share $ 0.50 $ 0.33 $ 0.98 $ 0.59
Diluted earnings per share $ 0.48 $ 0.32 $ 0.94 $ 0.57
Operating earnings per share:*
Basic earnings per share $ 0.50 $ 0.33 $ 0.96 $ 0.61
Diluted earnings per share $ 0.48 $ 0.32 $ 0.92 $ 0.59
* operating earnings per share excludes the effects of FAS 133 and extraordinary item
Federal Agricultural Mortgage Corporation
Supplemental Information
The following tables present quarterly and annual information regarding loan
purchases and guarantees, outstanding guarantees and delinquencies.
Farmer Mac Purchases and Guarantees
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Farmer Mac I
--------------------------
Loans & AMBS LTSPC Farmer Mac II Total
-------------- ---------- ---------------- ----------
(in thousands)
For the quarter ended:
June 30, 2002 $551,690 $280,904 $ 57,769 $890,363
March 31, 2002 74,875 338,821 39,154 452,850
December 31, 2001 62,953 237,292 51,056 351,301
September 30, 2001 69,561 246,472 42,396 358,429
June 30, 2001 85,439 499,508 57,012 641,959
March 31, 2001 48,600 49,695 47,707 146,002
For the year ended:
December 31, 2001 266,553 1,032,967 198,171 1,497,691
December 31, 2000 442,246 373,202 193,505 1,008,953
Farmer Mac Outstanding Guarantees (1)
---------------------------------------------------------------------------------------------------------------------------------
Farmer Mac I
------------------------------------------------
Post-1996 Act
--------------------------------
Loans & AMBS (2) LTSPC Pre-1996 Act Farmer Mac II Total Held in Portfolio (3)
------------------- ----------- --------------- ----------------- ----------- -----------------------
(in thousands)
As of:
June 30, 2002 $ 2,180,948 $ 2,336,886 $ 37,873 $617,503 $ 5,173,210 $ 2,426,626
March 31, 2002 1,655,485 2,126,485 41,414 592,836 4,416,220 1,899,484
December 31, 2001 1,658,716 1,884,260 48,979 595,156 4,187,111 1,857,232
September 30, 2001 1,605,160 1,731,861 58,813 608,944 4,004,778 1,804,391
June 30, 2001 1,572,800 1,537,061 65,709 579,251 3,754,821 1,763,676
March 31, 2001 1,466,443 1,083,528 72,646 549,003 3,171,620 1,648,896
Farmer Mac Loans and AMBS Held in Portfolio
------------------------------------------------------------------------------------------------------
Total
5-to-10-Year 1-Month-to-3-Year Held in
Fixed Rate ARMs & Resets ARMs Portfolio
------------------------------------------------------------------
(in thousands)
As of:
June 30, 2002 $ 1,016,997 $892,737 $ 516,892 $2,426,626
March 31, 2002 751,222 797,780 350,482 1,899,484
December 31, 2001 764,115 790,948 302,169 1,857,232
Post-1996 Act Loan Delinquencies (4)
------------------------------------------------
Outstanding
Delinquencies Guarantees Percentage
---------------- --------------- ---------------
(dollars in thousands)
As of:
June 30, 2002 $ 60,431 $ 4,489,735 1.35%
March 31, 2002 87,097 3,754,171 2.32%
December 31, 2001 58,279 3,428,176 1.70%
September 30, 2001 71,686 3,318,796 2.16%
June 30, 2001 53,139 3,089,460 1.72%
March 31, 2001 67,134 2,562,374 2.62%
Distribution of Post-1996 Act Loan Delinquencies
As of June 30, 2002
--------------------------------------------------------
(dollars in thousands)
Original LTV Ratio Delinquencies Percentage
---------------------- ------------- ----------
0.00% to 40.00% $ 5,813 10%
40.01% to 50.00% 9,816 16%
50.01% to 60.00% 21,498 36%
60.01% to 70.00% 22,021 36%
70.01% to 80.00% 1,283 2%
Total $ 60,431 100%
Distribution of Post-1996 Act Loan Delinquencies
As of June 30, 2002
---------------------------------------------------------------------
(dollars in thousands)
Loan
Origination Outstanding Delinquency
Date Delinquencies Guarantees Rate
------------------- --------------- ------------- -------------------
Before 1994 $ 2,324 $ 722,068 0.32%
1994 862 167,325 0.52%
1995 4,254 153,527 2.77%
1996 14,310 360,862 3.97%
1997 13,724 414,808 3.31%
1998 13,485 696,792 1.94%
1999 9,047 768,622 1.18%
2000 2,338 423,335 0.55%
2001 87 575,172 0.02%
2002 - 207,224 0.00%
------------ --------------- -------------
Total $ 60,431 $ 4,489,735 1.35%
------------ --------------- -------------
(1) Pre-1996 Act loans back securities that are supported by unguaranteed
subordinated interests representing approximately 10 percent of the balance
of the loans. Farmer Mac assumes 100 percent of the credit risk on
post-1996 Act loans. Farmer Mac II loans are guaranteed by the U.S.
Department of Agriculture.
(2) Periods prior to June 30, 2001 include only AMBS.
(3) Included in total outstanding guarantees.
(4) Includes loans 90 days or more past due, in foreclosure, in bankruptcy and
REO.