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For Immediate Release
February 27, 2004

AUSTIN, Texas - The Tenth Farm Credit District today reported record loan volume and net income for the year ended Dec. 31, 2003. The district is the largest rural lending network serving Alabama, Louisiana, Mississippi, New Mexico and Texas. It comprises the Austin-based Farm Credit Bank of Texas (FCBT) and 21 financing cooperatives in the five-state area.

For the ninth consecutive year, the district loan volume reached a new record level. Gross loan volume totaled $7.3 billion at year-end 2003, representing an increase of 7.0 percent and 21.0 percent from Dec. 31, 2002 and 2001, respectively.

"Last year, producers in the Tenth District benefited from the lower interest rate environment, stable land prices and improved prices in several major crops," said Larry Doyle, FCBT chief executive officer. "However, farmers also had to contend with rising production expenses, input costs and fuel prices. Despite these challenges, the district experienced loan volume growth, strong earnings and strong credit quality."

A solid demand for real estate, competitive pricing by the bank and associations, and continued marketing efforts contributed to the increase in the loan portfolio. Overall district loan credit quality was high, with acceptable loan volume remaining at 97.4 percent at year-end, unchanged from the previous year.

District net income totaled $168.6 million for the year ended Dec. 31, 2003, reflecting an increase of 31.7 percent from net income of $128.1 million for the previous year and 50.4 percent from net income reported at year-end 2001. The substantial increase is credited, in part, to the sale of the bank's mineral rights holdings for a gain of $30.5 million. Net interest income increased by 11.8 percent from 2002 to total $265.1 million for 2003.

As customer-owned financing cooperatives, the Farm Credit Bank of Texas and its affiliated local lending associations place a high priority on sharing their success with their customers. In 2003, the district returned $26.8 million in patronage and dividend distributions to stockholders, compared with $26.1 million in distributions in 2002.

The Farm Credit Bank of Texas provides funds and services to nine Federal Land Credit Associations, which provide rural mortgage financing, and 12 Agricultural Credit Associations, which offer both agricultural and rural mortgage loans. Together, these lending cooperatives had approximately 63,000 loans outstanding to farmers, ranchers, rural homeowners, agribusinesses and other rural landowners at year-end 2003. District assets totaled more than $8.8 billion.

The Tenth Farm Credit District is part of the nationwide Farm Credit System, established more than 85 years ago. The System reported combined net income of $1.825 billion for the year ended Dec. 31, 2003, as compared with $1.773 billion for 2002.