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| Farm Credit Co-ops Declare $120.5 Million in Patronage to Customers | |
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AUSTIN, Texas – Twenty Farm Credit financing cooperatives across Alabama, Louisiana, Mississippi, New Mexico and Texas declared a total of $120.5 million in patronage distributions to their customer-stockholders during 2006. For these rural lending co-ops, which are part of the Tenth Farm Credit District, the record patronage represents more than half of their 2006 earnings. It is more than double the $53.6 million in patronage that the Tenth District association lenders declared to customers last year. The announcement highlighted the strong 2006 year-end financial results reported by the rural lending network. “Our mission as cooperatives is to operate in the best interest of our customers, who are also our stockholders. We are extremely pleased to share our earnings with our Farm Credit customers, knowing that this record patronage payment effectively reduces their cost of borrowing,” said Farm Credit Bank of Texas (FCBT) Board Chairman Ralph W. Cortese. The Tenth Farm Credit District is composed of the Austin-based Farm Credit Bank of Texas and the 20 rural financing co-ops, or associations, in the five-state region. Together, they finance approximately 50,000 farmers, ranchers, country homeowners, agribusiness firms and other rural landowners. The Farm Credit Bank of Texas declared $34.42 million in patronage to the Tenth District financing co-ops and four Other Financing Institutions that own the bank, thereby reducing their cost of funds. In addition to record patronage, the Tenth Farm Credit District reported record loan volume growth, outstanding credit quality and strong net income for the year. District loan volume totaled $12.9 billion at Dec. 31, 2006, an increase of 26.3 percent, or $2.7 billion, from Dec. 31, 2005. The credit quality of the loan portfolio remained very high, improving slightly to 98.9 percent acceptable from 98.4 percent acceptable a year earlier. “In just five years, the Tenth District has more than doubled its loan portfolio, from $6 billion in 2001 to almost $13 billion in 2006. Such phenomenal growth is partly the result of a healthy rural economy in our region and strong demand for rural real estate,” said FCBT Chief Executive Officer Larry Doyle. “But largely this success is the result of sheer determination by our lending associations to capture more market share through competitive pricing, strong patronage programs and top-notch customer service,” he said. District net income totaled $240.1 million in 2006, up 9.2 percent from 2005 net income of $219.9 million. Net interest income of $386.2 million in 2006 reflected a 13.4 percent increase from the $340.5 million reported for 2005. The district’s assets totaled $16.0 billion at Dec. 31, 2006, compared with $13.2 billion at year-end 2005, reflecting an increase of 21 percent. The Farm Credit Bank of Texas also reported strong results in 2006. The bank’s loan volume totaled $10.1 billion at Dec. 31, 2006, an 18.5 percent increase from year-end 2005. Net income of $65 million for the year was 12.8 percent higher than 2005 net income. The Tenth Farm Credit District is part of the nationwide Farm Credit System, a network of rural lending cooperatives established in 1916. The System reported net income of $2.4 billion in 2006, compared with net income of $2.1 billion in 2005. The System had $162.9 billion in assets at Dec. 31, 2006. |
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