-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O5K4VPSkq/g+Tej7gjjXla1DVK6X4ectzL1Flul0SgH3aJn5B028U7WjsatxjWVj MAmvVSVWT5itwJ60RFvLZw== /in/edgar/work/0000845877-00-000012/0000845877-00-000012.txt : 20001115 0000845877-00-000012.hdr.sgml : 20001115 ACCESSION NUMBER: 0000845877-00-000012 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20001114 FILED AS OF DATE: 20001114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FEDERAL AGRICULTURAL MORTGAGE CORP CENTRAL INDEX KEY: 0000845877 STANDARD INDUSTRIAL CLASSIFICATION: [6111 ] IRS NUMBER: 521578738 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-14951 FILM NUMBER: 765358 BUSINESS ADDRESS: STREET 1: 919 18TH ST N W STREET 2: STE 200 CITY: WASHINGTON STATE: DC ZIP: 20006 BUSINESS PHONE: 2028727700 MAIL ADDRESS: STREET 1: 919 18TH STREET NW STREET 2: SUITE 200 CITY: WASHINGTON STATE: DC ZIP: 20006 10-Q 1 0001.txt 10-Q As filed with the Securities and Exchange Commission on - -------------------------------------------------------------------------------- November 14, 2000 - -------------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 - -------------------------------------------------------------------------------- FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2000. Commission File Number 0-17440 FEDERAL AGRICULTURAL MORTGAGE CORPORATION (Exact name of registrant as specified in its charter) Federally chartered instrumentality 52-1578738 of the United States (I.R.S. employer identification number) (State or other jurisdiction of incorporation or organization) 919 18th Street, N.W., Suite 200, 20006 Washington, D.C. (Zip code) (Address of principal executive offices) (202) 872-7700 (Registrant's telephone number, including area code) ----------------------------------------------- Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the last practicable date. As of November 14, 2000, there were 1,030,780 shares of Class A Voting Common Stock, 500,301 shares of Class B Voting Common Stock and 9,598,489 shares of Class C Non-Voting Common Stock outstanding. PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements The following interim consolidated financial statements of the Federal Agricultural Mortgage Corporation ("Farmer Mac" or the "Corporation") have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. These financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Certain information and footnote disclosures normally included in annual consolidated financial statements have been condensed or omitted as permitted by such rules and regulations. Management believes that the disclosures are adequate to present fairly the consolidated financial position, consolidated results of operations and consolidated cash flows at the dates and for the periods presented. These financial statements should be read in conjunction with the audited 1999 financial statements of Farmer Mac. Results for interim periods are not necessarily indicative of those to be expected for the fiscal year. The following information concerning Farmer Mac's financial statements is included herein. Consolidated Balance Sheets at September 30, 2000 and December 31, 1999....3 Consolidated Statements of Income for the three and nine months ended September 30, 2000 and 1999.............................................4 Consolidated Statements of Cash Flows for the nine months ended September 30, 2000 and 1999.............................................5 FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED BALANCE SHEETS
September 30, December 31, 2000 1999 ------------------- ------------------ (in thousands) Assets: Cash and cash equivalents $ 460,812 $ 336,282 Investment securities 896,301 847,220 Farmer Mac guaranteed securities 1,599,822 1,306,223 Loans 21,943 38,509 Interest receivable 38,050 42,900 Guarantee fees receivable 3,667 4,358 Prepaid expenses and other assets 14,526 14,918 ------------------- ------------------ Total Assets $ 3,035,121 $ 2,590,410 ------------------- ------------------ Liabilities and Stockholders' Equity: Liabilities: Notes payable Due within one year $ 2,207,501 $ 1,722,061 Due after one year 701,027 750,337 ------------------- ------------------ Total notes payable 2,908,528 2,472,398 Accrued interest payable 11,548 18,549 Accounts payable and accrued expenses 5,396 5,736 Reserve for losses 10,026 6,584 ------------------- ------------------ Total Liabilities 2,935,498 2,503,267 Stockholders' Equity: Common stock: Class A Voting, $1 par value, no maximum authorization, 1,030,780 shares issued and outstanding at September 30, 2000 and December 31, 1999. 1,031 1,031 Class B Voting, $1 par value, no maximum authorization, 500,301 shares issued and outstanding at September 30, 2000 and December 31, 1999. 500 500 Class C Non-Voting, $1 par value, no maximum authorization, 9,598,936 and 9,370,961 shares issued and outstanding at September 30, 2000 and December 31, 1999. 9,599 9,371 Additional paid-in capital 72,837 71,097 Accumulated other comprehensive income (loss) 1,291 (1,657) Retained earnings 14,365 6,801 ------------------- ------------------ Total Stockholders' Equity 99,623 87,143 ------------------- ------------------ Total Liabilities and Stockholders' Equity $ 3,035,121 $ 2,590,410 ------------------- ------------------ See accompanying notes to consolidated financial statements.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Nine Months Ended ------------------------------ ----------------------------- Sept. 30, Sept. 30, Sept. 30, Sept. 30, 2000 1999 2000 1999 -------------- -------------- -------------- -------------- (in thousands, except per share amounts) Interest income: Investments and cash equivalents $ 23,760 $ 19,202 $ 68,758 $ 50,506 Farmer Mac guaranteed securities 26,671 18,776 71,763 42,365 Loans 586 1,145 2,332 5,818 -------------- -------------- -------------- -------------- Total interest income 51,017 39,123 142,853 98,689 Interest expense 46,685 35,310 129,661 87,349 -------------- -------------- -------------- -------------- Net interest income 4,332 3,813 13,192 11,340 Other income: Guarantee fees 2,972 1,899 8,309 5,008 Miscellaneous 78 (88) 250 110 -------------- -------------- -------------- -------------- Total other income 3,050 1,811 8,559 5,118 -------------- -------------- -------------- -------------- Total revenues 7,382 5,624 21,751 16,458 Expenses: Compensation and employee benefits 1,037 1,127 3,353 3,387 Regulatory fees 150 142 451 352 General and administrative 888 916 2,777 2,660 -------------- -------------- -------------- -------------- Total operating expenses 2,075 2,185 6,581 6,399 Provision for losses 1,068 782 3,442 2,442 -------------- -------------- -------------- -------------- Total expenses 3,143 2,967 10,023 8,841 -------------- -------------- -------------- -------------- Income before income taxes 4,239 2,657 11,728 7,617 Income tax expense 1,505 901 4,164 2,588 -------------- -------------- -------------- -------------- Net income $ 2,734 $ 1,756 $ 7,564 $ 5,029 -------------- -------------- -------------- -------------- Earnings per share: Basic earnings per share $ 0.25 $ 0.16 $ 0.69 $ 0.46 Diluted earnings per share $ 0.24 $ 0.16 $ 0.66 $ 0.45 See accompanying notes to consolidated financial statements.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended September 30, -------------------------------------- 2000 1999 ----------------- ------------------ (in thousands) Cash flows from operating activities: Net income $ 7,564 $ 5,029 Adjustments to reconcile net income to cash provided by operating activities: Amortization of investment premiums and discounts 1,313 2,748 Decrease (increase) in interest receivable 4,850 (5,256) Decrease (increase) in guarantee fees receivable 691 (622) Increase in prepaid expenses and other assets 132 (7,754) Amortization of debt premiums, discounts and issuance costs 89,728 62,336 Increase in accrued interest payable (7,001) 2,672 Increase in accounts payable and accrued expenses (340) 508 Provision for losses 3,442 2,442 ----------------- ------------------ Net cash provided by operating activities 100,379 62,103 Cash flows from investing activities: Purchases of available-for-sale investments (199,599) (464,040) Purchases of investment securities (5,067) (10,399) Purchases of Farmer Mac guaranteed securities (338,589) (687,912) Purchases of loans (401,664) (323,200) Proceeds from repayment of available-for-sale investments 135,961 207,952 Proceeds from repayment of investment securities 16,988 53,922 Proceeds from repayment of Farmer Mac guaranteed securities 390,760 448,555 Proceeds from repayment of loans 709 5,206 Proceeds from sale of loans 76,024 - ----------------- ------------------ Net cash used by investing activities (324,477) (769,916) Cash flows from financing activities: Proceeds from issuance of discount notes 46,613,148 61,620,288 Proceeds from issuance of medium-term notes 65,853 376,315 Payments to redeem discount notes (46,299,039) (61,288,287) Payments to redeem medium-term notes (33,300) (35,840) Proceeds from common stock issuance 1,966 928 ----------------- ------------------ Net cash provided by financing activities 348,628 673,404 ----------------- ------------------ Net increase in cash and cash equivalents 124,530 (34,409) Cash and cash equivalents at beginning of period 336,282 540,626 ----------------- ------------------ Cash and cash equivalents at end of period $ 460,812 $ 506,217 ----------------- ------------------ See accompanying notes to consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1. Accounting Policies (a) Cash and Cash Equivalents Farmer Mac considers highly liquid investment securities with original maturities of three months or less to be cash equivalents. Changes in the balance of cash and cash equivalents are reported in the Consolidated Statements of Cash Flows using the indirect method of presentation. The following table sets forth information regarding certain cash and non-cash transactions for the nine months ended September 30, 2000 and 1999.
Nine Months Ended September 30, -------------------------- 2000 1999 ------------- ------------ (in thousands) Cash paid for: Interest $ 42,333 $ 20,935 Income taxes 3,825 3,787 Non-cash activity: Real estate owned acquired through foreclosure - 578 Loans securitized and retained as Farmer Mac guaranteed securities 340,619 467,198 Loans acquired in exchange for AMBS - 73,597
(b) Loans At September 30, 2000, loans held by Farmer Mac included $16.5 million held for sale and $5.5 million held for investment. At December 31, 1999, loans held by Farmer Mac included $21.4 million held for sale and $17.1 million held for investment. (c) Interest-Rate Contracts and Hedge Instruments Interest-rate contracts, including interest-rate swaps and caps, are used to alter synthetically the interest rate characteristics of specific investments or debt. As such, the net differential received or paid is recorded as an adjustment to interest income or expense of the associated assets or liabilities, on an accrual basis. Farmer Mac uses hedge instruments, including forward sale contracts involving debt and mortgage-backed securities of other government-sponsored enterprises ("GSEs") and futures contracts involving U.S. Treasury securities, to manage interest-rate risk exposure related to the purchase of loans and the issuances of debt. Farmer Mac measures correlation using changes in interest rates for the hedged items against changes in interest rates for the hedge instruments. Gains and losses on effective hedge instruments that have been terminated or have matured are deferred as an adjustment to the cost basis of the hedged item. Gains and losses on ineffective hedge instruments are marked-to-fair value directly through the consolidated statement of income. (d) Earnings Per Share Basic earnings per share are based on the weighted average common shares outstanding. Diluted earnings per share are based on the weighted average number of common shares outstanding adjusted to include all dilutive potential common stock. The following schedule reconciles basic and diluted earnings per share for the three and nine months ended September 30, 2000 and 1999:
September 30, 2000 September 30, 1999 ----------------------------------- ----------------------------------- Dilutive Dilutive Stock Diluted Stock Diluted Basic EPS options EPS Basic EPS options EPS ----------------------------------- ----------------------------------- (in thousands, except per share amounts) Three months ended: Net income $ 2,734 $ - $ 2,734 $ 1,756 $ - $ 1,756 Weighted average shares 11,123 291 11,414 10,850 419 11,269 Earnings per share $ 0.25 $ 0.24 $ 0.16 $ 0.16 Nine months ended: Net income $ 7,564 $ - $ 7,564 $ 5,029 $ - $ 5,029 Weighted average shares 11,039 444 11,483 10,824 404 11,228 Earnings per share $ 0.69 $ 0.66 $ 0.46 $ 0.45
(e) Reclassifications Certain reclassifications of prior period information were made to conform to the current period presentation. (f) New Accounting Standards In June 1998 and in June 2000, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 133 and No. 138, "Accounting for Certain Derivative Instruments and Certain Hedging Activities" ("SFAS 133" and "SFAS 138"). The statements establish accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts) be recorded in the balance sheet as either an asset or liability measured at its fair value. The statements require that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. Accounting for qualifying hedges allows a derivative's gains and losses to offset related results on the hedged item in the income statement, and requires that a company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. SFAS 133 and SFAS 138 are effective for fiscal years beginning after June 15, 2000 and cannot be applied retroactively. The statements must be applied to (a) free-standing derivative instruments and (b) certain derivative instruments embedded in hybrid contracts that were issued, acquired, or substantively modified after December 31, 1998. Farmer Mac is currently assessing the impact of adopting SFAS 133 and SFAS 138 on its financial statements. However, the adoption of the statements could increase volatility in earnings and other comprehensive income. In September 2000, the FASB issued Statement of Financial Accounting Standards No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities" ("SFAS 140"). Farmer Mac will incorporate SFAS 140's disclosure requirements relating to securitization transactions in its Annual Report on Form 10-K for the year 2000 to be filed in March 2001. Other provisions of SFAS 140 will be applied prospectively beginning April 1, 2001 as required by the standard. Management does not expect the implementation of SFAS 140 to materially affect Farmer Mac's reported results of operations and financial position. Note 2. Off-Balance Sheet Financial Instruments In the ordinary course of its business, Farmer Mac incurs off-balance sheet risk in connection with the issuance of commitments to purchase and sell loans, the issuance of its guarantee and the use of interest-rate contracts and hedge instruments. At September 30, 2000, outstanding commitments to purchase Farmer Mac I and II loans totaled $11.7 million. There were $17.6 million of commitments outstanding to sell loans at September 30, 2000. For information regarding the off-balance sheet risks associated with off-balance sheet guarantees, see "Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Management - Credit Risk." For information related to the use of interest-rate contracts and hedge instruments, see Note 1 (c) and "Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Management - Interest Rate Risk." Note 3. Comprehensive Income Comprehensive income is comprised of net income plus other changes in stockholders' equity not resulting from investments by or distributions to stockholders. The following table sets forth comprehensive income for the three and nine months ended September 30, 2000 and 1999. The change in unrealized gains on securities available-for-sale is net of the related tax expense of $1.8 million and $1.6 million for the three and nine months ended September 30, 2000, respectively, and $629 thousand and $283 thousand for the three and nine months ended September 30, 1999, respectively.
Three Months Ended Nine Months Ended September 30, September 30, --------------------------- ------------------------ 2000 1999 2000 1999 ------------ -------------- ----------- ----------- (in thousands) Net income $ 2,734 $ 1,756 $ 7,564 $ 5,029 Change in unrealized gain on securities available-for-sale, net of taxes 3,303 1,221 2,948 550 ------------ -------------- ----------- ----------- Comprehensive income $ 6,037 $ 2,977 $10,512 $ 5,579 ------------ -------------- ----------- -----------
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Special Note Regarding Forward-Looking Statements Certain statements made in this Form 10-Q are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 pertaining to management's current expectations as to Farmer Mac's future financial results, business prospects and business developments. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and typically are accompanied by, and identified with, such terms as "anticipates," "believes," "expects," "intends," "should" and similar phrases. The following management's discussion and analysis includes forward-looking statements addressing Farmer Mac's prospects for earnings and growth in loan purchase, guarantee and securitization volume; trends in net interest income, delinquencies and provision for losses; changes in capital position; and other business and financial matters. Management's expectations for Farmer Mac's future necessarily involve a number of assumptions and estimates and the evaluation of risks and uncertainties. Various factors could cause Farmer Mac's actual results or events to differ materially from the expectations as expressed or implied by the forward-looking statements, including: uncertainties regarding the rate and direction of development of the secondary market for agricultural mortgage loans; the possible establishment of additional statutory or regulatory restrictions applicable to Farmer Mac, such as the imposition of regulatory risk-based capital requirements in excess of current statutory minimum and critical capital levels or restrictions on Farmer Mac's investment authority; substantial changes in interest rates, the agricultural economy (including agricultural land values, commodity prices, export demand for U.S. agricultural products and federal assistance to farmers) or the general economy; protracted adverse weather, market or other conditions affecting particular geographic regions or particular commodities related to agricultural mortgage loans backing Farmer Mac guaranteed securities; legislative or regulatory developments or interpretations of Farmer Mac's statutory charter that could adversely affect Farmer Mac or the ability of certain lenders to participate in its programs or the terms of any such participation; the availability of debt funding in sufficient quantities and at favorable rates to support continued growth; the rate of growth in agricultural mortgage indebtedness; the size of the agricultural mortgage market; borrower preferences for fixed-rate agricultural mortgage indebtedness; the willingness of lenders to sell agricultural mortgage loans into the Farmer Mac secondary market; the willingness of investors to invest in agricultural mortgage-backed securities; competition in the origination or purchase of agricultural mortgage loans and the sale of agricultural mortgage-backed and debt securities; or changes in Farmer Mac's status as a government-sponsored enterprise. The foregoing factors are not exhaustive. Other sections of this report may include additional factors that could adversely impact Farmer Mac's business and its financial performance. Furthermore, new risk factors emerge from time to time and it is not possible for management to predict all such risk factors, nor assess the impact of such factors on Farmer Mac's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from the expectations expressed or implied by the forward-looking statements. Given these potential risks and uncertainties, no undue reliance should be placed on any forward-looking statements expressed in this report. Furthermore, Farmer Mac undertakes no obligation to release publicly the results of revisions to any forward-looking statements that may be made to reflect any future events or circumstances. Results of Operations Overview. Net income totaled $2.7 million for third quarter 2000, or $0.24 per share on a diluted basis, compared to $1.8 million, or $0.16 per share, for third quarter 1999. Earnings per share for the third quarter increased 50 percent over third quarter 1999. Farmer Mac's revenue growth continued in the third quarter of 2000, reflecting the effect of outstanding guarantee volume 46 percent higher than in the third quarter of 1999 and 17 percent higher than in the second quarter of 2000. By focusing its marketing resources during the first half of 2000 on promoting portfolio transactions, in an effort to stimulate interest in the use by portfolio lenders of sale, swap and standby transactions, Farmer Mac established a basis for higher business activity during the last six months of the year. Consequently, several significant transactions increased third quarter loan purchase and guarantee volume to $451 million -- several times the levels of third quarter 1999. Total year-to-date volume for 2000 continues to be below the 1999 levels for the same period, largely due to the continuation of unfavorable economic conditions in the agricultural sector during the past year, as well as higher interest rates. Weak market opportunities for agricultural commodities and products and low commodity prices have persisted throughout 2000. These conditions led to the enactment of legislation providing substantial government financial support for farmers earlier this year -- higher than the level of support provided in 1999. While these actions have maintained farm sector income at a level above the 1990-99 average and contributed to strong farmland values in most regions of the nation, government payments and persistent economic uncertainty in the agricultural sector have muted farmers' demand for new agricultural mortgage loans. Farmer Mac responded to these market conditions by re-emphasizing to agricultural lenders their ability to use Farmer Mac's programs to reduce their concentrated exposures to agricultural credit risks. The Corporation believes that the increase in portfolio sales, swaps and long-term standby commitments during the third quarter of 2000 is a good indication that Farmer Mac has positioned itself for growth in the coming months and anticipates additional transactions during the fourth quarter of 2000 and into 2001; although the total volume of those transactions is uncertain at this time, the Corporation's current estimates for fourth quarter 2000 are for at least $200 million. Farmer Mac also expects two established agricultural lending networks to begin originating new mortgage loans for sale into Farmer Mac's cash window during the fourth quarter. Set forth below is a more detailed discussion of Farmer Mac's results of operations. Net Interest Income. Net interest income was $4.3 million for third quarter 2000, and $13.2 million for year-to-date 2000, compared to $3.8 million and $11.3 million for the same periods in 1999. The increase in net interest income was primarily attributable to increases in the balance of program assets, driven by Farmer Mac's retention of its guaranteed agricultural mortgage-backed securities ("AMBS"). The following table provides information regarding the average balances and rates of interest-earning assets and funding for the nine months ended September 30, 2000 and 1999. The decrease in net interest yield from the first nine months of 1999 to the first nine months of 2000, as reflected in the table below, was due to a combination of generally higher debt spreads, as well as tighter spreads on short-term and variable rate investments and on Farmer Mac guaranteed securities.
Nine Months Ended September 30, ---------------------------------------------------------------------- 2000 1999 --------------------------------- -------------------------------- Average Income/ Average Average Income/ Average Balance Expense Rate Balance Expense Rate --------- --------- --------- --------- --------- --------- (dollars in thousands) Assets Cash and cash equivalents $ 511,150 $ 24,400 6.37% $ 587,847 $ 22,158 5.03% Investments 888,745 44,358 6.66% 695,068 28,348 5.44% Farmer Mac guaranteed securities 1,397,364 71,763 6.85% 862,645 42,365 6.55% Loans 38,756 2,332 8.02% 115,609 5,818 6.71% --------- --------- --------- --------- --------- --------- Total interest earning assets 2,836,015 142,853 6.72% 2,261,169 98,689 5.82% --------- --------- --------- --------- --------- --------- Liabilities and Stockholders' Equity Notes and bonds, net 2,797,990 129,661 6.18% 2,202,154 87,349 5.29% --------- --------- Total interest bearing liabilities 2,797,990 2,202,154 Net non-interest bearing funding 38,025 - 0.00% 59,015 - 0.00% --------- --------- --------- --------- --------- --------- Total liabilities and stockholders' equity 2,836,015 129,661 6.10% 2,261,169 87,349 5.15% --------- --------- --------- --------- --------- --------- Net interest income/spread 13,192 0.62% 11,340 0.67% --------- --------- --------- ---------
The table below sets forth certain information regarding the changes in the components of Farmer Mac's net interest income for the periods indicated. For each category, information is provided on changes attributable to changes in volume (change in volume multiplied by old rate) and changes in rate (change in rate multiplied by old volume). Combined rate/volume variances, a third element of the calculation, are allocated based on their relative size.
Nine Months Ended September 30, 2000 Compared to Nine Months Ended September 30, 1999 --------------------------------------- Increase/(Decrease) Due to --------------------------------------- Rate Volume Total ------------- ------------- --------- (in thousands) Income from interest-earning assets Cash and cash equivalents 5,386 (3,144) 2,242 Investments 7,131 8,879 16,010 Farmer Mac guaranteed securities 2,020 27,378 29,398 Loans 965 (4,451) (3,486) ------------ ------------- --------- Total 15,502 28,662 44,164 Expense from interest-bearing liabilities 16,227 26,085 42,312 ------------ ------------- --------- Change in net interest income (725) 2,577 1,852 ------------ ------------- ---------
Other Income. Other income, which is comprised of guarantee fee income and miscellaneous income, totaled $3.1 million for third quarter 2000 and $8.6 million for year-to-date 2000, compared to $1.8 million and $5.1 million, respectively, in 1999. Guarantee fee income, the largest component of other income, was $3.0 million for third quarter 2000, as compared to $1.9 million for third quarter 1999 and $2.8 million for second quarter 2000. The relative increases in guarantee fees reflect an increase in the average balance of outstanding guarantees. Miscellaneous income was $78 thousand for third quarter 2000, compared to losses of $88 thousand and $10 thousand for third quarter 1999 and second quarter 2000, respectively. Expenses. During the third quarter 2000, operating expenses totaled $2.1 million compared to $2.2 million for third quarter 1999 and $2.1 million for second quarter 2000. Operating expenses also declined as a percentage of total revenues for the same quarters to 28 percent from 39 percent and 30 percent, respectively. For year-to-date 2000, operating expenses totaled $6.6 million compared to $6.4 million for the same period in 1999. Farmer Mac's provision for principal and interest losses was $1.1 million for third quarter 2000, and $3.4 million for year-to-date 2000, compared to $782 thousand and $2.4 million, respectively, for 1999. At September 30, 2000, Farmer Mac's reserve for losses totaled $10.0 million, or 0.43 percent of outstanding post-1996 Act loans, compared to $5.7 million 0.38 percent, at September 30, 1999. Income Tax Expense. The provision for income taxes totaled $1.5 million for third quarter 2000, and $4.2 million for year-to-date 2000, compared to $901 thousand and $2.6 million for the same periods in 1999. Farmer Mac's effective tax rates for the nine months ended September 30, 2000 and 1999 were 35.5 percent and 34.0 percent, respectively. Business Volume. The following table sets forth the amount of loans purchased or guaranteed, and AMBS issued during the periods indicated:
Three Months Ended Nine Months Ended September 30, September 30, ---------------------------- ---------------------------- 2000 1999 2000 1999 ------------- ------------- ------------- ------------ (in thousands) Purchase and guarantee volume: Farmer Mac I Cash window $ 292,658 $ 70,561 $ 396,519 $ 319,436 Swap transactions - - 73,597 LTSPC 158,291 - 192,700 407,701 Farmer Mac II 40,036 28,239 157,476 97,635 ------------- ------------- ------------- ------------ Total loans purchased or guaranteed $ 490,985 $ 98,800 $ 746,695 $ 898,369 ------------- ------------- ------------- ------------ AMBS issuances: Retained $ 272,497 $ 153,397 $ 340,619 $ 467,198 Sold $ 20,247 - 144,815 - Swap transactions - - - 73,597 ------------- ------------- ------------- ------------ Total AMBS issuances $ 292,744 $ 153,397 $ 485,434 $ 540,795 ------------- ------------- ------------- ------------
See "Overview" above for a discussion regarding changes in the amount of loans purchased and guaranteed by Farmer Mac. Indicators of future purchase and guarantee volume, particularly cash window activity, include outstanding commitments to purchase loans and the total balance of loans submitted for approval or approved but not yet purchased. Most purchase commitments entered into by Farmer Mac are mandatory delivery commitments. If a seller obtains a mandatory commitment and is unable to deliver the loans required thereunder within the specified time period, Farmer Mac requires the seller to pay a fee to extend or cancel the commitment. At September 30, 2000, outstanding commitments to purchase or guarantee Farmer Mac I loans totaled $11.0 million, compared to $17.0 million at September 30, 1999. Of the total commitments outstanding at September 30, 2000 and 1999, $5.8 million and $850 thousand, respectively, were optional commitments. Loans submitted for approval or approved but not yet committed to purchase totaled $109.1 million at September 30, 2000, compared to $181.6 million at September 30, 1999. Not all of these loans are expected to be purchased, as Farmer Mac expects to deny some for credit reasons and to have others withdrawn by the seller. While significant progress has been made in developing the secondary market for agricultural mortgages, Farmer Mac continues to face the challenges of establishing a new market. Management believes that acceptance of Farmer Mac's programs is increasing among lenders, reflecting the competitive rates, terms and products offered and the advantages we believe Farmer Mac's programs provide. For Farmer Mac to succeed in realizing its business development and profitability goals over the long term, however, agricultural mortgage lenders, whether traditional or non-traditional, must value the benefits of selling loans to Farmer Mac or otherwise obtaining the benefits of the Farmer Mac guarantee and must be persuaded to modify their business practices accordingly. Balance Sheet Review Total assets grew by $444.7 million over the nine months of 2000, due to a $277.0 million increase in on-balance sheet program assets (Farmer Mac guaranteed securities and loans), and a $173.6 million increase in non-program assets (cash and cash equivalents and investments). For further information regarding both on- and off-balance sheet guaranteed securities, see "Supplemental Information" below. Total liabilities increased by $432.2 million from December 31, 1999 to September 30, 2000 due to growth in notes payable, which corresponded to the net increase in program and non-program assets. Medium-term notes, including $340.1 million of discount notes synthetically altered to long-term debt through interest-rate swap contracts, totaled $1.17 billion at September 30, 2000, compared to $797.5 million at December 31, 1999. The increase in medium-term notes corresponds to AMBS issued and retained by Farmer Mac during the first three quarters. Farmer Mac's regulatory core capital totaled $98.3 million at September 30, 2000, compared with $88.8 million at December 31, 1999 and $95.5 million at June 30, 2000. The capital balance at September 30, 2000 exceeded Farmer Mac's regulatory minimum capital requirements by approximately $4.7 million. Farmer Mac's current surplus capital would support additional guarantee growth in amounts ranging from $171 million of on-balance sheet guarantees to $627 million of off-balance sheet guarantees, based on existing minimum capital requirements. Furthermore, should Farmer Mac deem it appropriate, on-balance sheet non-program investment assets (cash and cash equivalents and investment securities) of $1.4 billion could be sold, resulting in the ability to carry total additional guarantees (including the aforementioned $171 million and $627 million) ranging from approximately $1.5 billion of on-balance sheet guarantees to over $5 billion of off-balance sheet guarantees. Ultimately, Farmer Mac could sell on-balance sheet program assets of $1.6 billion in order to support further increases in on- and off-balance sheet program guarantees, resulting in the cumulative ability to carry over $10 billion of off-balance sheet guarantees. Any of these transactions would, of course, be evaluated for optimization of Farmer Mac's return on equity and capital flexibility. Return on average equity increased to 11.3 percent during third quarter 2000, compared to 8.0 percent during third quarter 1999 and 11.0 percent during second quarter 2000. Risk Management Interest Rate Risk. Farmer Mac's asset and liability management objective is to limit the effect of changes in interest rates on its equity and earnings to within acceptable risk tolerance levels. In doing so, Farmer Mac enters into off-balance sheet derivative financial instruments, including interest-rate swaps and caps (collectively "interest-rate contracts"), forward sale contracts involving GSE debt and mortgage-backed securities and futures contracts involving U.S. Treasury securities. Farmer Mac uses interest-rate contracts to alter synthetically the interest rate characteristics of specific investments or debt, which enables Farmer Mac to achieve a better matching of the interest rate characteristics of its investments and debt. At September 30, 2000, the notional amount of interest-rate contracts was $1.2 billion compared to $769.5 million at December 31, 1999. Farmer Mac uses forward sale and futures contracts to reduce its interest rate risk exposure to loans committed or purchased and not yet sold or funded as retained investments, which totaled $10.2 million at September 30, 2000 and $19.7 million at December 31, 1999. At September 30, 2000, the notional amount of outstanding forward sale and futures contracts totaled $8.5 million, compared to $16.7 million at December 31, 1999. Farmer Mac monitors its exposure to interest rate risk by measuring the sensitivity of its market value of equity (MVE) to an immediate and permanent parallel shift in the Treasury yield curve. The following schedule summarizes the results of Farmer Mac's MVE sensitivity analysis at September 30, 2000 and December 31, 1999. The increase in MVE sensitivity in the increasing interest rate scenarios reflects an increase in the amount of short-term debt at September 30, 2000 as compared to December 31, 1999 (see "Balance Sheet Review" above).
Percentage Change in MVE from Base Case --------------------------- Interest Rate September 30, December 31, Scenario 2000 1999 ------------- ------------- ------------ + 300 bp -19.2% -9.4% + 200 bp -12.5% -5.6% + 100 bp -5.6% -2.1% - 100 bp 2.7% -1.1% - 200 bp 3.1% -6.5% - 300 bp 1.9% -15.0%
Credit Risk. The outstanding principal balance of those loans held or guaranteed by Farmer Mac as of September 30, 2000 and December 31, 1999 is summarized in the table below.
September 30, 2000 December 31, 1999 ------------------ ----------------- (in thousands) Farmer Mac I: Pre-1996 Act $ 104,755 $ 132,047 Post-1996 Act 2,349,781 1,878,749 Farmer Mac II 491,820 383,266 ------------------ ----------------- Total $ 2,946,356 $ 2,394,062 ------------------ -----------------
Farmer Mac believes it has little or no credit risk exposure to pre-1996 Act Farmer Mac I loans because of the first loss subordinated interests related to the pools of those loans, or to Farmer Mac II loans because they are guaranteed by the USDA. Farmer Mac assumes 100 percent of the credit risk on post-1996 Act loans; pre-1996 Act loans are supported by mandatory 10 percent first loss subordinated interests that mitigate credit exposure. At September 30, 2000, post-1996 Act loans that were 90 days or more past due represented 1.80 percent of the principal amount of all post-1996 Act loans, compared to 1.56 percent at September 30, 1999 and 1.05 percent at December 31, 1999. Farmer Mac anticipates fluctuations in the delinquency rate from quarter to quarter as demonstrated by the increase in such rate at September 30, 2000 as compared to December 31, 1999. Higher levels are likely to be reported during the first and third quarters of each year due to the semiannual payment characteristics of most Farmer Mac loans. Congress has provided significant income support to the agricultural sector for 2000, which, based on forecast reports issued by the U.S. Department of Agriculture, should result in farm income in 2000 being at levels greater than in 1999. This increase in farm income should help to moderate delinquencies during the remainder of 2000 and into 2001. The federal income support is not allocated equally to producers of all agricultural commodities, and is paid to the owners of agricultural land and may not be received by farmers and ranchers who rent part or all of the land on which they operate. Farmers and ranchers that do not receive significant federal income support may be more likely to become delinquent on their agricultural mortgage loans than are those who receive such support. The following table shows Farmer Mac I delinquencies distributed by Post-1996 Act loans and Pre-1996 Act loans.
Farmer Mac I Delinquencies (1) (2) -------------------------------------------------------------------- Post-1996 Act Pre-1996 Act Total ------------- ------------ ----------- As of: September 30, 2000 1.80% 5.55% 1.96% June 30, 2000 1.25% 4.12% 1.41% March 31, 2000 1.45% 4.89% 1.65% December 31, 1999 1.05% 3.04% 1.18% September 30, 1999 1.56% 3.53% 1.74% (1) Includes loans 90 days or more past due, in foreclosure or in bankruptcy. (2) Pre-1996 Act loans back securities that are supported by unguaranteed subordinated interests representing approximately 10 percent of the balance of the loans backing each security. 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.
Farmer Mac maintains a reserve to cover credit losses incurred on post-1996 Act loans. The following schedule summarizes the change in the reserve for loan losses for the three and nine months ended September 30, 2000 and 1999:
Three Months Ended Nine Months Ended September 30, September 30, -------------------------------------------------------- 2000 1999 2000 1999 -------------- ------------ -------------- ------------ (in thousands) Beginning balance $ 8,958 $4,915 $ 6,584 $3,259 Provision for losses 1,068 782 3,442 2,442 Net charge-offs - (4) -------------- ------------ -------------- ------------ Ending balance $10,026 $5,697 $10,026 $5,697 -------------- ------------ -------------- ------------
Although some credit losses are expected to be incurred on the existing post-1996 Act Farmer Mac I delinquencies, Farmer Mac expects those losses to be within current reserve levels based on the collateral values supporting the loans. The following table summarizes the post-1996 Act delinquencies by loan-to-value ratio (calculated by dividing the current loan principal balance by the original appraised value):
Distribution of Post- 1996 Act Delinquencies as of September 30, 2000 ----------------------- By loan-to-value ratio: 0.00% to 40.00% 13% 40.01% to 50.00% 22% 50.01% to 60.00% 29% 60.01% to 70.00% 33% 70.01% to 80.00% 3% ----------------------- Total 100% -----------------------
As of September 30, 2000, the weighted average loan-to-value ratio of post-1996 Act loans was 51 percent and the weighted average loan-to-value ratio for all post-1996 Act delinquent loans that were 90 days or more past due, in foreclosure or in bankruptcy was 58 percent. The following table segregates the post-1996 Act delinquencies at September 30, 2000 by year of origination, geographic region and commodity.
Distribution of Post-1996 Delinquency Loans Rate ----------------- ------------- By year of origination: Before 1996 23% 0.12% 1996 8% 0.00% 1997 28% 0.45% 1998 9% 6.43% 1999 11% 3.23% 2000 20% 3.51% ---------------- Total 100% 1.80% ---------------- By geographic region: (1) Mid-north 17% 0.69% Mid-south 5% 0.00% Northeast 2% 3.85% Northwest 35% 2.89% Southeast 3% 3.41% Southwest 38% 1.25% ---------------- Total 100% 1.80% ---------------- By commodity: Crops 49% 2.57% Livestock 18% 0.96% Other 1% 0.00% Permanent plantings 27% 1.31% Part-Time Farm 5% 0.31% ---------------- Total 100% 1.80% ---------------- (1)Geographic regions - Mid-North (IA, IL, IN, MI, MN, MO, WI); Mid-South (KS, OK, TX); Northeast (CT, DE, KY, MA, MD, ME, NC, NH, NJ, NY, OH, PA, RI, TN, VA, VT, WV); Northwest (ID, MT, ND, NE, OR, SD, WA, WY); Southeast (AL, AR, FL, GA, LA, MS, SC); and Southwest (AZ, CA, CO, NM, NV, UT).
Supplemental Information The following tables set forth quarterly activity regarding commitments to purchase loans, purchases and guarantees of loans, AMBS issuances, delinquencies and outstanding guarantees.
Commitments to Purchase or Guarantee Farmer Mac I Loans (1) (2) - ------------------------------------------------------------------------------------------------------- Long-Term Fixed Rate Resets ARMs Total Outstanding ------------- ----------- ---------- ---------- ------------- (in thousands) For the quarter ended: September 30, 2000 $ 288,274 $ 126,909 $ 40,097 $ 455,280 $ 10,983 June 30, 2000 45,838 2,822 32,361 81,021 8,641 March 31, 2000 10,369 16,835 32,438 59,642 10,707 December 31,1999 317,357 6,882 75,326 399,565 12,470 September 30, 1999 26,623 19,384 34,170 80,177 17,010 For the year ended: December 31, 1999 537,190 58,065 203,536 798,791 12,470 December 31, 1998 302,227 48,412 502,283 852,922 431,544
Purchases and Guarantees of Farmer Mac I Loans (1) (2) - ---------------------------------------------------------------------------------------- Long-Term Fixed Rate Resets ARMs Total ------------- ----------- ---------- ---------- (in thousands) For the quarter ended: September 30, 2000 $ 286,303 $ 126,845 $ 37,801 $ 450,949 June 30, 2000 43,508 5,702 30,777 79,987 March 31, 2000 11,917 13,185 33,181 58,283 December 31, 1999 319,478 9,522 73,030 402,030 September 30, 1999 26,670 14,862 29,029 70,561 For the year ended: December 31, 1999 662,186 57,176 483,402 1,202,764 December 31, 1998 164,436 48,086 211,737 424,259
Farmer Mac I AMBS Issuances (1) (3) - ---------------------------------------------------------------------------------------- Long-Term Fixed Rate Resets ARMs Total ------------- ----------- ---------- ---------- (in thousands) For the quarter ended: September 30, 2000 $ 126,639 $ 130,188 $ 35,916 $ 292,743 June 30, 2000 15,122 4,950 36,748 56,820 March 31, 2000 6,582 14,616 45,880 67,078 December 31, 1999 128,641 8,084 17,069 153,794 September 30, 1999 95,121 33,532 24,744 153,397 For the year ended: December 31, 1999 359,185 57,887 277,517 694,589 December 31, 1998 165,383 51,941 84,322 301,646
Outstanding Guarantees (4) - ------------------------------------------------------------------------------------------------------------ Farmer Mac I --------------------------------------------- Post-1996 Act ------------------------------ Pre-1996 Farmer Held in AMBS LTSPC Act Mac II Total Portfolio (5) -------------- --------------- -------------- --------------- -------------- -------------- (in thousands) As of: September 30, 2000 $1,621,516 $ 707,850 $ 92,536 $ 491,820 $2,913,722 $1,571,315 June 30, 2000 1,354,623 575,143 100,414 467,352 2,497,532 1,292,359 March 31, 2000 1,310,710 551,423 107,403 387,992 2,357,528 1,268,889 December 31,1999 1,266,522 575,097 118,214 383,266 2,343,099 1,237,623 September 30, 1999 1,118,266 367,934 130,452 377,663 1,994,315 1,190,741 (1) Includes guarantees issued by Farmer Mac through swap transactions. Such transactions totaled $103.2 million in fourth quarter 1999 and $73.6 million in first quarter 1999. (2) Includes long-term standby purchase commitments (LTSPC) of $158.3 million committed to and executed in the third quarter of 2000, $34.4 million and $226.8 million committed to and executed in second quarter 2000 and fourth quarter 1999, respectively, and $407.7 million committed to in fourth quarter 1998 and executed in first quarter 1999. Such transactions obligate Farmer Mac to purchase loans in the pool at par when they become four or more months delinquent. In exchange, Farmer Mac receives an annual commitment fee on the outstanding balance of the pool over the life of the loans. (3) Includes AMBS issued and retained by Farmer Mac. Such transactions totaled $272.5 million in the third quarter of 2000, $21.7 million in second quarter 2000, $46.5 million in first quarter 2000, $50.6 million in fourth quarter 1999, and $153.4 million in third quarter 1999. (4) 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. (5) Included in total outstanding guarantees.
Item 3. Quantitative and Qualitative Disclosures About Market Risk Farmer Mac is exposed to market risk from changes in interest rates. Farmer Mac manages this market risk by entering into various financial transactions, including off-balance sheet derivative financial instruments, and by monitoring its exposure to changes in interest rates. See "Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Management - Interest Rate Risk" for further information regarding Farmer Mac's exposure to interest rate risk and strategies to manage such risk. For information regarding Farmer Mac's use of off-balance sheet derivative financial instruments, including Farmer Mac's accounting policies for such instruments, see Notes 1(c) and 2 to the Consolidated Financial Statements. PART II - OTHER INFORMATION Item 1. Legal Proceedings The Registrant is not a party to any material pending legal proceedings. Item 2. Changes in Securities and Use of Proceeds (a) Not applicable (b) Not applicable. (c) Farmer Mac is a federally chartered instrumentality of the United States and its Common Stock is exempt from registration pursuant to Section 3(a)(2) of the Securities Act of 1933. Pursuant to Farmer Mac's policy which permits Directors of Farmer Mac to elect to receive shares of Class C Non-Voting Common Stock in lieu of their annual cash retainers, on July 12, 2000, Farmer Mac issued an aggregate of 943 shares of its Class C Non-Voting Common Stock at an issue price of $14.56 per share to the 10 Directors who elected to receive such stock in lieu of their cash retainers. On August 14, 2000, Farmer Mac granted options under its 1997 Stock Option Plan to purchase an aggregate of 2,000 shares of Class C Non-Voting Common Stock, at an exercise price of $15.625 per share to a non-officer employee in connection with such employee's commencement of employment. On September 8, 2000, Farmer Mac granted options under its 1997 Stock Option Plan to purchase an aggregate of 59,227 shares of Class C Non-Voting Common Stock, at an exercise price of $16.375 per share to non-officer employees as incentive compensation. (d) Not applicable. Item 3. Defaults upon Senior Securities Not applicable. Item 4. Submission of Matters to a Vote of Securityholders. Not applicable. Item 5. Other Information. None. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits. * 3.1 - Title VIII of the Farm Credit Act of 1971, as most recently amended by the Farm Credit System Reform Act of 1996, P.L. 104-105 (Form 10-K filed March 29, 1996). * 3.2 - Amended and restated Bylaws of the Registrant (Form 10-Q filed August 12, 1999). +* 10.1 - Stock Option Plan (Previously filed as Exhibit 19.1 to Form 10-Q filed November 10, 1992). +* 10.1.1 - Amendment No. 1 to Stock Option Plan (Previously filed as Exhibit 10.2 to Form 10-Q filed August 16, 1993). +* 10.1.2 - 1996 Stock Option Plan (Form 10-Q filed November 10, 1996). +* 10.1.3 - Amended and Restated 1997 Stock Option Plan. +* 10.2 - Employment Agreement dated May 5, 1989 between Henry D. Edelman and the Registrant (Previously filed as Exhibit 10.4 to Form 10-K filed February 14, 1990). +* 10.2.1 - Amendment No. 1 dated as of January 10, 1991 to Employment Contract between Henry D. Edelman and the Registrant (Previously filed as Exhibit 10.4 to Form 10-K filed April 1, 1991). +* 10.2.2 - Amendment to Employment Contract dated as of September 1, 1993 between Henry D. Edelman and the Registrant (Previously filed as Exhibit 10.5 to Form 10-Q filed November 15, 1993). +* 10.2.3 - Amendment No. 3 dated as of September 1, 1994 to Employment Contract between Henry D. Edelman and the Registrant (Previously filed as Exhibit 10.5 to Form 10-Q filed November 15, 1994). _______________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan. +* 10.2.4 - Amendment No. 4 dated as of February 8, 1996 to Employment Contract between Henry D. Edelman and the Registrant (Form 10-K filed March 29, 1996). +* 10.2.5 - Amendment No. 5 dated as of September 13, 1996 to Employment Contract between Henry D. Edelman and the Registrant (Form 10-Q filed November 10, 1996). +* 10.2.6 - Amendment No. 6 dated as of August 7, 1997 to Employment Contract between Henry D. Edelman and the Registrant (Form 10-Q filed November 14, 1997). +* 10.2.7 - Amendment No. 7 dated as of September 4, 1998 to Employment Contract between Henry D. Edelman and the Registrant (Form 10-Q filed August 14, 1998). +* 10.2.8 - Amendment No. 8 dated as of June 3, 1999 to Employment Contract between Henry D. Edelman and the Registrant (Form 10-Q filed August 12, 1999). +* 10.2.9 - Amendment No. 9 dated as of June 1, 2000 to Employment Contract between Henry D. Edelman and the Registrant (Form 10-Q filed August 14, 2000). +* 10.3 - Employment Agreement dated May 11, 1989 between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.5 to Form 10-K filed February 14, 1990). +* 10.3.1 - Amendment dated December 14, 1989 to Employment Agreement between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.5 to Form 10-K filed February 14, 1990). +* 10.3.2 - Amendment No. 2 dated February 14, 1991 to Employment Agreement between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.7 to Form 10-K filed April 1, 1991). +* 10.3.3 - Amendment to Employment Contract dated as of September 1, 1993 between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.9 to Form 10-Q filed November 15, 1993). +* 10.3.4 - Amendment No. 4 dated September 1, 1993 to Employment Contract between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.11 to Form 10-K filed March 30, 1994). _______________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan. +* 10.3.5 - Amendment No.5 dated as of September 1, 1994 to Employment Contract between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.12 to Form 10-Q filed August 15, 1994). +* 10.3.6 - Amendment No.6 dated as of September 1, 1995 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-Q filed November 10, 1995). +* 10.3.7 - Amendment No. 7 dated as of February 8, 1996 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-K filed March 29, 1996). +* 10.3.8 - Amendment No. 8 dated as of September 13, 1996 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-Q filed November 10, 1996). +* 10.3.9 - Amendment No. 9 dated as of August 7, 1997 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-Q filed November 14, 1997). +* 10.3.10 - Amendment No. 10 dated as of September 4, 1998 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 14, 1998). +* 10.3.11 - Amendment No. 11 dated as of June 3, 1999 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 12, 1999). +* 10.3.12 - Amendment No. 12 dated as of June 1, 2000 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 14, 2000). +* 10.4 - Employment Agreement dated September 13, 1989 between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.6 to Form 10-K filed April 1, 1990). +* 10.4.1 - Amendment No. 1 dated February 14, 1991 to Employment Agreement between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.9 to Form 10-K filed April 1, 1991). +* 10.4.2 - Amendment to Employment Contract dated as of September 1, 1993 between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.12 to Form 10-Q filed November 15, 1993). _______________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan. +* 10.4.3 - Amendment No. 3 dated September 1, 1993 to Employment Contract between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.16 to Form 10-K filed March 30, 1994). +* 10.4.4 - Amendment No. 4 dated as of September 1, 1994 to Employment Contract between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.17 to Form 10-Q filed August 15, 1994). +* 10.4.5 - Amendment No.5 dated as of September 1, 1995 to Employment Contract between Thomas R. Clark and the Registrant (Form 10-Q filed November 10, 1995). +* 10.4.6 - Amendment No. 6 dated as of February 8, 1996 to Employment Contract between Thomas R. Clark and the Registrant (Form 10-K filed March 29, 1996). +* 10.4.7 - Amendment No. 7 dated as of September 13, 1996 to Employment Contract between Thomas R. Clark and the Registrant (Form 10-Q filed November 10, 1996). +* 10.4.8 - Amendment No. 8 dated as of August 7, 1997 to Employment Contract between Thomas R. Clark and the Registrant(Form 10-Q filed November 14, 1997). +* 10.4.9 - Amendment No.9 dated as of September 4, 1998 to Employment Contract between Thomas R. Clark and the Registrant (Form 10-Q filed August 14, 1998). +* 10.4.10 - Amendment No. 10 dated as of September 3, 1999 to Employment Contract between Thomas R. Clark and the Registrant(Form 10-Q filed August 12, 1999). +* 10.4.11 - Amendment No. 11 dated as of June 1, 2000 to Employment Contract between Thomas R. Clark and the Registrant (Form 10-Q filed August 14, 2000). +* 10.5 - Employment Contract dated as of September 1, 1997 between Tom D. Stenson and the Registrant(Previously filed as Exhibit 10.8 to Form 10-Q filed November 14, 1997). +* 10.5.1 - Amendment No.1 dated as of September 4, 1998 to Employment Contract between Tom D. Stenson and the Registrant (Previously filed as Exhibit 10.8.1 to Form 10-Q filed August 14, 1998). _______________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan. +* 10.5.2 - Amendment No.2 dated as of September 3, 1999 to Employment Contract between Tom D. Stenson and the Registrant (Form 10-Q filed August 12, 1999). +* 10.5.3 - Amendment No.3 dated as of September 1, 2000 to Employment Contract between Tom D. Stenson and the Registrant (Form 10-Q filed August 14, 2000). +* 10.6 - Employment Agreement dated February 1, 2000 between Jerome G. Oslick and the Registrant (Form 10-Q filed May 11, 2000). +* 10.6.1 - Amendment No. 1 dated as of June 1, 2000 to Employment Contract between Jerome G. Oslick and the Registrant (Form 10-Q filed August 14, 2000). * 10.9 - Lease Agreement, dated September 30, 1991 between 919 Eighteenth Street, N. W. Associates Limited Partnership and the Registrant (Previously filed as Exhibit 10.20 to Form 10-K filed March 30, 1992). * 21 - Farmer Mac Mortgage Securities Corporation, a Delaware Corporation. * 99.1 - Map of U.S. Department of Agriculture (Secretary of Agriculture's) Regions (Previously filed as Exhibit 1.1 to Form 10-K filed April 1, 1991). (b) Reports on Form 8-K. The Registrant did not file any reports on Form 8-K during the quarter ended September 30, 2000. _______________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FEDERAL AGRICULTURAL MORTGAGE CORPORATION November 14, 2000 By: /s/ Henry D. Edelman __________________________________________ Henry D. Edelman President and Chief Executive Officer (Principal Executive Officer) /s/ Nancy E. Corsiglia __________________________________________ Nancy E. Corsiglia Vice President - Finance (Principal Financial Officer) SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FEDERAL AGRICULTURAL MORTGAGE CORPORATION November 14, 2000 By: __________________________________________ Henry D. Edelman President and Chief Executive Officer (Principal Executive Officer) __________________________________________ Nancy E. Corsiglia Vice President - Finance (Principal Financial Officer) EX-27 2 0002.txt
5 Basic earnings per share are $0.69. Diluted earnings per share are $0.66. 1,000 9-mos DEC-31-2000 SEP-30-2000 460,812 2,496,123 41,717 0 0 517,055 220 0 3,035,121 2,224,445 701,027 0 0 11,130 88,493 3,035,121 0 142,853 0 0 10,023 3,442 129,661 11,728 4,164 7,564 0 0 0 7,564 0.69 0.66
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