Farmer Mac reported net income of $5 million in the second quarter, more than double the $2 million net profit recorded the same period last year, as it saw increased net interest income earned on a higher level of business volume plus releases from its allowance for loan losses.
Guarantee and commitment fees increased to $6.3 million for 2Q11 from $5.7 million one year prior. There was also an $800,000 release from its allowance for loan losses.
It added $608 million in program volume during the quarter, bringing the total to $12.2 billion, unchanged from the end of the year. In the first six months, there was $1.6 billion of principal paydowns.
The second quarter program volume included the purchase of $300 million in Farmer Mac I AgVantage Securities and the purchase of $117 million of Farmer Mac I loans. It also purchased $100 million of USDA-guaranteed portions of loans.
After the quarter ended, Farmer Mac came to an agreement with MetLife to replace a $1 billion off-balance sheet AgVantage security that matured in July with new AgVantage securities issued by MetLife totaling $1 billion with maturities ranging from 2014 through 2021. Farmer Mac has already purchased $800 million of these new securities. This new transaction will be on Farmer Mac's balance sheet.
As of June 30, 90-day delinquencies in the Farmer Mac I portfolio were $54.6 million or 1.27% of the portfolio, down from $56 million or 1.3% one year previous.
When Farmer Mac II (USDA-guaranteed loans) plus AgVantage Securities and rural utility loans are included in the 90-day late calculation, the overall level of delinquencies is 0.45%.
