Loans and Allowance for Losses and Concentrations of Credit Risk (Tables)

3 Months Ended

Mar. 31, 2013

Loans and Allowance for Losses [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

Loans

Farmer Mac classifies loans as either held for investment or held for sale. Loans held for investment are recorded at the unpaid principal balance, net of unamortized premium or discount and other cost adjustments. Loans held for sale are reported at the lower of cost or fair value determined on a pooled basis. The following table displays the composition of the loan balances as of March 31, 2013 and December 31, 2012:

	March 31, 2013									December 31, 2012
	Unsecuritized			In Consolidated Trusts			Total			Unsecuritized			In Consolidated Trusts			Total
	(in thousands)
Farm & Ranch	$	1,538,381		$	166,163		$	1,704,544		$	1,519,415		$	160,436		$	1,679,851
Rural Utilities	677,931			361,767			1,039,698			663,097			368,848			1,031,945
Total unpaid principal balance (1)	2,216,312			527,930			2,744,242			2,182,512			529,284			2,711,796
Unamortized premiums, discounts and other cost basis adjustments	(4,101		)	33,752			29,651			981			34,291			35,272
Lower of cost or fair value adjustment on loans held for sale	—			—			—			(5,943		)	—			(5,943		)
Total loans	$	2,212,211		$	561,682		$	2,773,893		$	2,177,550		$	563,575		$	2,741,125
Loans held for investment, at amortized cost	$	2,212,211		$	561,682		$	2,773,893		$	1,503,559		$	563,575		$	2,067,134
Loans held for sale, at lower of cost or fair value	—			—			—			673,991			—			673,991
Total loans	2,212,211			561,682			2,773,893			2,177,550			563,575			2,741,125
Allowance for loan losses	(7,643		)	(324		)	(7,967		)	(10,986		)	(365		)	(11,351		)
Loans held for sale, at lower of cost or fair value	$	2,204,568		$	561,358		$	2,765,926		$	2,166,564		$	563,210		$	2,729,774

Allowance for Credit Losses on Financing Receivables [Table Text Block]

The following is a summary of the changes in the allowance for losses for the three months ended March 31, 2013 and 2012:

	March 31, 2013								March 31, 2012
	Allowance for Loan Losses			Reserve for Losses		Total Allowance for Losses			Allowance for Loan Losses		Reserve for Losses		Total Allowance for Losses
	(in thousands)
For the Three Months Ended:
Beginning Balance	$	11,351		$	5,539	$	16,890		$	10,161	$	7,355	$	17,516
Provision for losses	430			746		1,176			420		30		450
Charge-offs	(3,814		)	—		(3,814		)	—		—		—
Ending Balance	$	7,967		$	6,285	$	14,252		$	10,581	$	7,385	$	17,966

During first quarter 2013, Farmer Mac recorded provisions to its allowance for loan losses of $0.4 million and provisions to its reserve for losses of $0.7 million. The increased provisions recorded during first quarter 2013 were primarily attributable to increased estimated probable losses inherent in Farmer Mac's non-ethanol related Ag. Storage and Processing loans. Farmer Mac also recorded charge-offs of

$3.8 million to its allowance for loan losses during first quarter 2013. The charge-offs recorded in first quarter 2013 included a $3.6 million charge-off related to one ethanol loan that transitioned to REO during the quarter and for which Farmer Mac had previously provided a specific allowance. During first quarter 2012, Farmer Mac recorded provisions to its allowance for loan losses of $0.4 million and provisions to its reserve for losses of $30,000. Farmer Mac recorded no charge-offs to its allowance for losses during first quarter 2012.

The following tables present the changes in the allowance for losses for the three months ended March 31, 2013 and 2012 by commodity type:

	For the Three Months Ended March 31, 2013
	Crops		Permanent Plantings			Livestock		Part-time Farm			Ag. Storage and Processing (including ethanol facilities)			Other		Total
	(in thousands)
Beginning Balance	$	2,589	$	2,316		$	1,534	$	784		$	9,661		$	6	$	16,890
Provision for/(release of) losses	28		199			53		(51		)	935			12		1,176
Charge-offs	—		(189		)	—		—			(3,625		)	—		(3,814		)
Ending Balance	$	2,617	$	2,326		$	1,587	$	733		$	6,971		$	18	$	14,252

	For the three Months Ended March 31, 2012
	Crops		Permanent Plantings		Livestock			Part-time Farm		Ag. Storage and Processing (including ethanol facilities)			Other		Total
	(in thousands)
Beginning Balance	$	4,133	$	3,365	$	685		$	1,223	$	8,106		$	4	$	17,516
Provision for/(release of) losses	133		117		(49		)	252		(6		)	3		450
Charge-offs	—		—		—			—		—			—		—
Ending Balance	$	4,266	$	3,482	$	636		$	1,475	$	8,100		$	7	$	17,966

Schedule of Allowance for Losses by Impairment Method and Commodity [Table Text Block]

The following tables present the ending balances of loans held and loans underlying LTSPCs and Farmer Mac Guaranteed Securities and the related allowance for losses by impairment method and commodity type as of March 31, 2013 and December 31, 2012:

	As of March 31, 2013
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Ending Balance:
Collectively evaluated for impairment:
On-balance sheet	$	999,390	$	245,448	$	264,593	$	48,215	$	43,450	$	—	$	1,601,096
Off-balance sheet	1,197,974		569,230		973,358		128,349		177,488		9,993		3,056,392
Total	$	2,197,364	$	814,678	$	1,237,951	$	176,564	$	220,938	$	9,993	$	4,657,488
Individually evaluated for impairment:
On-balance sheet	$	31,342	$	47,429	$	13,667	$	10,895	$	—	$	115	$	103,448
Off-balance sheet	6,894		7,022		4,731		2,125		—		901		21,673
Total	$	38,236	$	54,451	$	18,398	$	13,020	$	—	$	1,016	$	125,121
Total Farm & Ranch loans:
On-balance sheet	$	1,030,732	$	292,877	$	278,260	$	59,110	$	43,450	$	115	$	1,704,544
Off-balance sheet	1,204,868		576,252		978,089		130,474		177,488		10,894		3,078,065
Total	$	2,235,600	$	869,129	$	1,256,349	$	189,584	$	220,938	$	11,009	$	4,782,609
Allowance for Losses:
Collectively evaluated for impairment:
On-balance sheet	$	1,485	$	499	$	478	$	45	$	2,281	$	—	$	4,788
Off-balance sheet	395		210		656		48		4,690		4		6,003
Total	$	1,880	$	709	$	1,134	$	93	$	6,971	$	4	$	10,791
Individually evaluated for impairment:
On-balance sheet	$	688	$	1,547	$	328	$	616	$	—	$	—	$	3,179
Off-balance sheet	49		70		125		24		—		14		282
Total	$	737	$	1,617	$	453	$	640	$	—	$	14	$	3,461
Total Farm & Ranch loans:
On-balance sheet	$	2,173	$	2,046	$	806	$	661	$	2,281	$	—	$	7,967
Off-balance sheet	444		280		781		72		4,690		18		6,285
Total	$	2,617	$	2,326	$	1,587	$	733	$	6,971	$	18	$	14,252

	As of December 31, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Ending Balance:
Collectively evaluated for impairment:
On-balance sheet	$	977,564	$	260,047	$	268,869	$	50,287	$	42,812	$	—	$	1,599,579
Off-balance sheet	1,169,710		584,880		1,002,164		136,482		144,637		11,000		3,048,873
Total	$	2,147,274	$	844,927	$	1,271,033	$	186,769	$	187,449	$	11,000	$	4,648,452
Individually evaluated for impairment:
On-balance sheet	$	22,002	$	29,647	$	11,511	$	12,660	$	4,337	$	115	$	80,272
Off-balance sheet	2,073		7,958		5,197		2,436		—		901		18,565
Total	$	24,075	$	37,605	$	16,708	$	15,096	$	4,337	$	1,016	$	98,837
Total Farm & Ranch loans:
On-balance sheet	$	999,566	$	289,694	$	280,380	$	62,947	$	47,149	$	115	$	1,679,851
Off-balance sheet	1,171,783		592,838		1,007,361		138,918		144,637		11,901		3,067,438
Total	$	2,171,349	$	882,532	$	1,287,741	$	201,865	$	191,786	$	12,016	$	4,747,289
Allowance for Losses:
Collectively evaluated for impairment:
On-balance sheet	$	1,406	$	586	$	499	$	46	$	2,265	$	—	$	4,802
Off-balance sheet	476		215		680		57		3,996		5		5,429
Total	$	1,882	$	801	$	1,179	$	103	$	6,261	$	5	$	10,231
Individually evaluated for impairment:
On-balance sheet	$	684	$	1,465	$	335	$	665	$	3,400	$	—	$	6,549
Off-balance sheet	23		50		20		16		—		1		110
Total	$	707	$	1,515	$	355	$	681	$	3,400	$	1	$	6,659
Total Farm & Ranch loans:
On-balance sheet	$	2,090	$	2,051	$	834	$	711	$	5,665	$	—	$	11,351
Off-balance sheet	499		265		700		73		3,996		6		5,539
Total	$	2,589	$	2,316	$	1,534	$	784	$	9,661	$	6	$	16,890

Impaired Financing Receivables [Table Text Block]

The following tables present by commodity type the unpaid principal balances, recorded investment, and specific allowance for losses related to impaired loans and the recorded investment in loans on nonaccrual status as of March 31, 2013 and December 31, 2012:

	As of March 31, 2013
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
Impaired Loans:
With no specific allowance:
Recorded investment	$	18,255	$	23,574	$	6,800	$	1,934	$	—	$	—	$	50,563
Unpaid principal balance	18,027		23,428		6,659		1,914		—		—		50,028
With a specific allowance:
Recorded investment	20,896		31,692		12,008		11,202		—		1,022		76,820
Unpaid principal balance	20,209		31,023		11,739		11,106		—		1,016		75,093
Associated allowance	737		1,617		453		640		—		14		3,461
Total:
Recorded investment	39,151		55,266		18,808		13,136		—		1,022		127,383
Unpaid principal balance	38,236		54,451		18,398		13,020		—		1,016		125,121
Associated allowance	737		1,617		453		640		—		14		3,461
Recorded investment of loans on nonaccrual status (1)	$	10,582	$	15,358	$	4,024	$	6,722	$	—	$	—	$	36,686

(1) Includes $4.5 million of loans that are less than 90 days delinquent but which have not met Farmer Mac's performance criteria for returning to accrual status.

	As of December 31, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
Impaired Loans:
With no specific allowance:
Recorded investment	$	7,295	$	11,652	$	7,644	$	3,140	$	—	$	907	$	30,638
Unpaid principal balance	7,247		11,509		7,489		3,090		—		901		30,236
With a specific allowance:
Recorded investment	17,214		26,567		9,360		12,118		4,337		117		69,713
Unpaid principal balance	16,829		26,095		9,219		12,007		4,337		114		68,601
Associated allowance	706		1,515		355		682		3,400		1		6,659
Total:
Recorded investment	24,509		38,219		17,004		15,258		4,337		1,024		100,351
Unpaid principal balance	24,076		37,604		16,708		15,097		4,337		1,015		98,837
Associated allowance	706		1,515		355		682		3,400		1		6,659
Recorded investment of loans on nonaccrual status (1)	$	11,888	$	15,789	$	5,141	$	8,180	$	4,337	$	—	$	45,335

(1) Includes $15.7 million of loans that are less than 90 days delinquent but which have not met Farmer Mac's performance criteria for returning to accrual status.

The following table presents by commodity type the average recorded investment and interest income recognized on impaired loans for the three months ended March 31, 2013 and 2012:

	For the Three Months Ended March 31, 2013
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
Average recorded investment in impaired loans	$	31,830	$	46,743	$	17,906	$	14,197	$	2,169	$	1,023	$	113,868
Income recognized on impaired loans	342		374		154		194		—		—		1,064

	For the Three Months Ended March 31, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including  ethanol facilities)		Other		Total
	(in thousands)
Average recorded investment in impaired loans	$	27,676	$	34,003	$	12,303	$	15,729	$	5,121	$	1,037	$	95,869
Income recognized on impaired loans	87		280		62		104		—		—		533

Schedule of Certain Loans Acquired in Transfer Acquired During Period [Table Text Block]

During the three months ended March 31, 2013, Farmer Mac purchased two defaulted loans having an unpaid principal balance of $0.1 million from pools underlying Farm & Ranch Guaranteed Securities and LTSPCs.  During the three months ended March 31, 2012, Farmer Mac purchased one defaulted loan having an unpaid principal balance of $0.7 million from pools underlying Farm & Ranch Guaranteed Securities and LTSPCs.

The following tables present information related to Farmer Mac's acquisition of defaulted loans for the three months ended March 31, 2013 and 2012 and the outstanding balances and carrying amounts of all such loans as of March 31, 2013 and December 31, 2012:

	For the Three Months Ended
	March 31, 2013		March 31, 2012
	(in thousands)
Unpaid principal balance at acquisition date:
Loans underlying LTSPCs	$	37	$	—
Loans underlying Farmer Mac Guaranteed Securities	103		729
Total unpaid principal balance at acquisition date	140		729
Contractually required payments receivable	143		732
Impairment recognized subsequent to acquisition	386		15
Recovery/release of allowance for defaulted loans	50		40

	March 31, 2013		December 31, 2012
	(in thousands)
Outstanding balance	$	34,166	$	41,737
Carrying amount	29,870		33,798

Schedule of Certain Loans Acquired in Transfer Acquired During Period, Delinquencies and Credit Losses [Table Text Block]

Net credit losses and 90-day delinquencies as of and for the periods indicated for loans held and loans underlying Farm & Ranch Guaranteed Securities and LTSPCs are presented in the table below. Information is not presented for loans underlying Farm & Ranch AgVantage securities and the USDA Guarantees and Rural Utilities lines of business.  Each AgVantage security is a general obligation of an issuing institution approved by Farmer Mac and is secured by eligible loans in an amount at least equal to the outstanding principal amount of the security.  Farmer Mac excludes the loans that secure AgVantage securities from the credit risk metrics it discloses because of the credit quality of the issuing institutions, the collateralization level for the securities, and because delinquent loans are required to be removed from the pool of pledged loans and replaced with current eligible loans.  

As of March 31, 2013, there were no probable losses inherent in Farmer Mac's AgVantage securities due to the credit quality of the obligors, as well as the underlying collateral.  To date, Farmer Mac has not experienced any credit losses on any Farm & Ranch AgVantage securities. The USDA-guaranteed portions presented as USDA Guaranteed Securities, as well as those that collateralize Farmer Mac Guaranteed Securities, are guaranteed by the USDA. Each USDA guarantee is an obligation backed by the full faith and credit of the United States. As of March 31, 2013, neither Farmer Mac nor Farmer Mac II LLC had experienced any credit losses on any of those USDA Guaranteed Securities or Farmer Mac Guaranteed Securities. As of March 31, 2013, there were no delinquencies and no probable losses inherent in the Farmer Mac's rural utilities loans held or in any Farmer Mac Guaranteed Securities – Rural Utilities.  As of March 31, 2013, Farmer Mac has not experienced any credit losses on any of those loans or securities.

	90-Day Delinquencies (1)				Net Credit Losses
	As of				For the Three Months Ended
	March 31, 2013		December 31, 2012		March 31, 2013		March 31, 2012
	(in thousands)
On-balance sheet assets:
Farm & Ranch:
Loans	$	32,198	$	29,592	$	3,810	$	—
Total on-balance sheet	$	32,198	$	29,592	$	3,810	$	—
Off-balance sheet assets:
Farm & Ranch:
LTSPCs	$	7,465	$	3,671	$	—	$	—
Total off-balance sheet	$	7,465	$	3,671	$	—	$	—
Total	$	39,663	$	33,263	$	3,810	$	—

(1) Includes loans and loans underlying Farm & Ranch Guaranteed Securities and LTSPCs that are 90 days or more past due, in foreclosure, restructured after delinquency, and in bankruptcy, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.

Of the $32.2 million and $29.6 million of on-balance sheet loans reported as 90-day delinquencies as of March 31, 2013 and December 31, 2012, respectively, $11.3 million and $4.6 million, respectively, are loans subject to "removal-of-account" provisions.

Financing Receivable Credit Quality Indicators [Table Text Block]

The following tables present credit quality indicators related to loans held and loans underlying LTSPCs and Farm & Ranch Guaranteed Securities (excluding AgVantage securities) as of March 31, 2013 and December 31, 2012:  

	As of March 31, 2013
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Credit risk profile by internally assigned grade (1)
On-balance sheet:
Acceptable	$	970,854	$	226,463	$	251,822	$	45,379	$	13,258	$	—	$	1,507,776
Other assets especially mentioned ("OAEM") (2)	28,572		18,401		12,771		2,836		10,201		—		72,781
Substandard (2)	31,306		48,013		13,667		10,895		19,991		115		123,987
Total on-balance sheet	$	1,030,732	$	292,877	$	278,260	$	59,110	$	43,450	$	115	$	1,704,544
Off-Balance Sheet:
Acceptable	$	1,175,751	$	551,729	$	907,719	$	122,724	$	147,942	$	9,287	$	2,915,152
Other assets especially mentioned ("OAEM") (2)	8,255		8,574		35,532		3,381		7,201		598		63,541
Substandard (2)	20,862		15,949		34,838		4,369		22,345		1,009		99,372
Total off-balance sheet	$	1,204,868	$	576,252	$	978,089	$	130,474	$	177,488	$	10,894	$	3,078,065
Total Ending Balance:
Acceptable	$	2,146,605	$	778,192	$	1,159,541	$	168,103	$	161,200	$	9,287	$	4,422,928
Other assets especially mentioned ("OAEM") (2)	36,827		26,975		48,303		6,217		17,402		598		136,322
Substandard (2)	52,168		63,962		48,505		15,264		42,336		1,124		223,359
Total	$	2,235,600	$	869,129	$	1,256,349	$	189,584	$	220,938	$	11,009	$	4,782,609
Commodity analysis of past due loans (1)
On-balance sheet	$	3,828	$	16,961	$	6,905	$	4,385	$	—	$	119	$	32,198
Off-balance sheet	4,275		42		2,876		272		—		—		7,465
90-days or more past due	$	8,103	$	17,003	$	9,781	$	4,657	$	—	$	119	$	39,663

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans. 

(2) Assets in the OAEM category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.  Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

	As of December 31, 2012
	Crops		Permanent Plantings		Livestock		Part-time Farm		Ag. Storage and Processing (including ethanol facilities)		Other		Total
	(in thousands)
Credit risk profile by internally assigned grade (1)
On-balance sheet:
Acceptable	$	947,097	$	226,253	$	252,525	$	48,156	$	11,972	$	—	$	1,486,003
Other assets especially mentioned ("OAEM") (2)	30,466		33,794		16,344		2,131		19,981		—		102,716
Substandard (2)	22,003		29,647		11,511		12,660		15,196		115		91,132
Total on-balance sheet	$	999,566	$	289,694	$	280,380	$	62,947	$	47,149	$	115	$	1,679,851
Off-Balance Sheet
Acceptable	$	1,143,790	$	567,064	$	922,254	$	130,557	$	114,983	$	10,287	$	2,888,935
Other assets especially mentioned ("OAEM") (2)	10,459		5,068		40,410		3,220		23,372		592		83,121
Substandard (2)	17,534		20,706		44,697		5,141		6,282		1,022		95,382
Total off-balance sheet	$	1,171,783	$	592,838	$	1,007,361	$	138,918	$	144,637	$	11,901	$	3,067,438
Total Ending Balance:
Acceptable	$	2,090,887	$	793,317	$	1,174,779	$	178,713	$	126,955	$	10,287	$	4,374,938
Other assets especially mentioned ("OAEM") (2)	40,925		38,862		56,754		5,351		43,353		592		185,837
Substandard (2)	39,537		50,353		56,208		17,801		21,478		1,137		186,514
Total	$	2,171,349	$	882,532	$	1,287,741	$	201,865	$	191,786	$	12,016	$	4,747,289
Commodity analysis of past due loans (1)
On-balance sheet	$	3,971	$	10,756	$	4,389	$	6,022	$	4,337	$	117	$	29,592
Off-balance sheet	697		45		2,833		96		—		—		3,671
90-days or more past due	$	4,668	$	10,801	$	7,222	$	6,118	$	4,337	$	117	$	33,263

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.  

(2) Assets in the OAEM category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.  Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

Schedules of Concentration of Risk, by Risk Factor [Table Text Block]

The following table sets forth the geographic and commodity/collateral diversification, as well as the range of original loan-to-value ratios, for all loans held and loans underlying Farm & Ranch Guaranteed Securities (excluding AgVantage securities) and LTSPCs as of March 31, 2013 and December 31, 2012:

	March 31, 2013		December 31, 2012
	(in thousands)
By commodity/collateral type:
Crops	$	2,235,600	$	2,171,349
Permanent plantings	869,129		882,532
Livestock	1,256,349		1,287,741
Part-time farm	189,584		201,865
Ag. Storage and Processing (including ethanol facilities)	220,938		191,786
Other	11,009		12,016
Total	$	4,782,609	$	4,747,289
By geographic region (1):
Northwest	$	464,878	$	840,693
Southwest	1,742,298		1,781,822
Mid-North	1,411,917		989,903
Mid-South	569,876		504,914
Northeast	250,982		261,756
Southeast	342,658		368,201
Total	$	4,782,609	$	4,747,289
By original loan-to-value ratio:
0.00% to 40.00%	$	1,219,929	$	1,338,715
40.01% to 50.00%	923,067		851,980
50.01% to 60.00%	1,345,849		1,296,225
60.01% to 70.00%	1,132,798		1,091,427
70.01% to 80.00%	118,843		122,259
80.01% to 90.00%	42,123		46,683
Total	$	4,782,609	$	4,747,289

(1) Geographic regions:  Northwest (AK, ID, MT, OR, WA, WY); Southwest (AZ, CA, CO, HI, NM, NV, UT); Mid-North (IA, IL, IN, MI, MN, NE, ND, SD, WI); Mid-South (AR, KS, LA, MO, OK, TX); Northeast (CT, DE, KY, MA, MD, ME, NH, NJ, NY, OH, PA, RI, VA, VT, WV); Southeast (AL, FL, GA, MS, NC, SC, TN).