AUSTIN, Texas – Farm Credit Bank of Texas (FCBT), a cooperatively owned source of financing for agriculture and rural America, reported increased growth and strong earnings in the third quarter.
Total assets increased 6.5 percent year-to-date to $17.26 billion at Sept. 30, 2014, driven primarily by a 7.9 percent increase in gross loan volume during the same period. The bank’s $12.7 billion loan portfolio includes direct notes to its retail lending cooperatives and other financing institutions, as well as capital markets loans that provide capital and liquidity for food, agribusiness, energy and rural infrastructure companies.
Net income for the third quarter and first nine months of 2014 was $55.1 million and $146.4 million, respectively, compared with $43.5 million and $139.9 million for the same periods in 2013.
With increased loan growth and a decrease in nonperforming assets, the bank’s credit quality remained strong in the third quarter, with 98.7 percent of the portfolio classified acceptable and special mention, compared with 98.2 percent at year-end.
As of Sept. 30, 2014, the bank’s shareholders’ equity exceeded $1.5 billion, and its permanent capital ratio of 18.59 percent was well in excess of the 7.0 percent minimum established by the bank’s independent regulator, the Farm Credit Administration (FCA). The bank held cash and investments totaling $4.4 billion, and its 238 days of liquidity exceeded FCA liquidity requirements.
“Our mission is about helping the agriculture industry and rural America to be successful by providing reliable and competitive financing for our customers,” said Larry Doyle, chief executive officer. “Our consistent strong performance and sound financial position enhances our ability to accomplish that mission and add value throughout rural America.”
The Austin-based bank and its 15 affiliated retail lending cooperatives make up the Texas Farm Credit District — the largest network of rural lenders serving Alabama, Louisiana, Mississippi, New Mexico and Texas. Together, the Texas District reported net income of $136.6 million and $360.0 million for the third quarter and first nine months of 2014, respectively, compared with $105.9 million and $325.3 million for the same periods in 2013.
“Our affiliated retail lenders are doing a very good job of serving rural America,” said Jimmy Dodson, FCBT board chairman. “The growth and quality of the loan portfolio throughout our territory continues an excellent trend.”
Collectively, the Texas District reported loan volume of $18.69 billion at quarter-end, up from $17.73 billion at year-end, with total assets increasing from $22.37 billion to $23.5 billion. Credit quality remained strong, with 98.5 percent of district loans classified as acceptable and special mention.
The results discussed herein are preliminary and unaudited. The bank’s financial statements and the combined statements of the Texas District for the quarter are expected to be available on or about Nov. 7, 2014.
The district is a part of the Farm Credit System, the nation’s largest source of financing for agriculture and rural America. Nationally, the System reported combined net income of $1.23 billion and $3.57 billion for the three-month and nine-month periods ended Sept. 30, 2014, compared with $1.25 billion and $3.50 billion for the same periods in 2013.