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Business Segment Reporting
 6 Months Ended
Jun. 30, 2018
Segment Reporting [Abstract]  
Segment Reporting Disclosure [Text Block]
BUSINESS SEGMENT REPORTING

The following tables present core earnings for Farmer Mac's operating segments and a reconciliation to consolidated net income for the three and six months ended June 30, 2018 and 2017:

Table 9.1
Core Earnings by Business Segment
For the Three Months Ended June 30, 2018
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
15,889

 
$
5,072

 
$
3,313

 
$
18,805

 
$
854

 
$
—

 
$
43,933

Less: reconciling adjustments(1)(2)(3)(4)
(2,542
)
 
(674
)
 
(390
)
 
(3,585
)
 
(580
)
 
7,771

 
—

Net effective spread
13,347

 
4,398

 
2,923

 
15,220

 
274

 
7,771

 
—

Guarantee and commitment fees(2)
4,488

 
190

 
402

 
91

 
—

 
(1,690
)
 
3,481

Other income/(expense)(3)
341

 
8

 
5

 
—

 
(209
)
 
2,754

 
2,899

Non-interest income/(loss)
4,829

 
198

 
407

 
91

 
(209
)
 
1,064

 
6,380

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
(424
)
 
—

 
—

 
—

 
—

 
—

 
(424
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
(158
)
 
—

 
—

 
—

 
—

 
—

 
(158
)
Other non-interest expense
(4,954
)
 
(1,312
)
 
(739
)
 
(2,030
)
 
(3,728
)
 
—

 
(12,763
)
Non-interest expense(5)
(5,112
)
 
(1,312
)
 
(739
)
 
(2,030
)
 
(3,728
)
 
—

 
(12,921
)
Core earnings before income taxes
12,640

 
3,284

 
2,591

 
13,281

 
(3,663
)
 
8,835

(6) 
36,968

Income tax (expense)/benefit
(2,654
)
 
(690
)
 
(544
)
 
(2,789
)
 
1,200

 
(1,855
)
 
(7,332
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
9,986

 
2,594

 
2,047

 
10,492

 
(2,463
)
 
6,980

(6) 
29,636

Preferred stock dividends
—

 
—

 
—

 
—

 
(3,296
)
 
—

 
(3,296
)
Segment core earnings/(losses)
$
9,986

 
$
2,594

 
$
2,047

 
$
10,492

 
$
(5,759
)
 
$
6,980

(6) 
$
26,340

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
4,428,172

 
$
2,177,345

 
$
995,068

 
$
8,144,763

 
$
2,881,423

 
$
—

 
$
18,626,771

Total on- and off-balance sheet program assets at principal balance
$
7,045,397

 
$
2,418,115

 
$
1,669,440

 
$
8,391,885

 
—

 
—

 
$
19,524,837

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(6) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.


Core Earnings by Business Segment
For the Three Months Ended June 30, 2017
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
13,338

 
$
5,176

 
$
3,003

 
$
15,431

 
$
2,783

 
$
—

 
$
39,731

Less: reconciling adjustments(1)(2)(3)(4)
(2,180
)
 
(625
)
 
(334
)
 
(964
)
 
(294
)
 
4,397

 
—

Net effective spread
11,158

 
4,551

 
2,669

 
14,467

 
2,489

 
4,397

 
—

Guarantee and commitment fees(2)
4,191

 
99

 
487

 
165

 
—

 
(1,470
)
 
3,472

Other income/(expense)(3)(5)
994

 
11

 
5

 
—

 
(146
)
 
(592
)
 
272

Non-interest income/(loss)
5,185

 
110

 
492

 
165

 
(146
)
 
(2,062
)
 
3,744

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
(327
)
 
—

 
—

 
—

 
—

 
—

 
(327
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
(139
)
 
—

 
—

 
—

 
—

 
—

 
(139
)
Other non-interest expense
(4,446
)
 
(1,166
)
 
(643
)
 
(1,622
)
 
(3,374
)
 
—

 
(11,251
)
Non-interest expense(6)
(4,585
)
 
(1,166
)
 
(643
)
 
(1,622
)
 
(3,374
)
 
—

 
(11,390
)
Core earnings before income taxes
11,431

 
3,495

 
2,518

 
13,010

 
(1,031
)
 
2,335

(7) 
31,758

Income tax (expense)/benefit
(4,001
)
 
(1,223
)
 
(881
)
 
(4,554
)
 
352

 
(817
)
 
(11,124
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
7,430

 
2,272

 
1,637

 
8,456

 
(679
)
 
1,518

(7) 
20,634

Preferred stock dividends
—

 
—

 
—

 
—

 
(3,296
)
 
—

 
(3,296
)
Non-controlling interest
—

 
—

 
—

 
—

 
150

 
—

 
150

Segment core earnings/(losses)
$
7,430

 
$
2,272

 
$
1,637

 
$
8,456

 
$
(3,825
)
 
$
1,518

(7) 
$
17,488

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
3,958,344

 
$
2,141,569

 
$
1,038,383

 
$
7,425,774

 
$
2,703,315

 
$
—

 
$
17,267,385

Total on- and off-balance sheet program assets at principal balance
$
6,426,518

 
$
2,237,013

 
$
1,883,909

 
$
7,711,418

 
$
—

 
$
—

 
$
18,258,858

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes reconciling adjustments for fair value adjustments on financial derivatives and trading assets. Also includes a reconciling adjustment related to the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.
(6) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(7) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.

Core Earnings by Business Segment
For the Six Months Ended June 30, 2018
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
30,830

 
$
10,142

 
$
5,850

 
$
36,637

 
$
3,703

 
$
—

 
$
87,162

Less: reconciling adjustments(1)(2)(3)(4)
(4,943
)
 
(1,344
)
 
23

 
(6,593
)
 
(1,042
)
 
13,899

 
—

Net effective spread
25,887

 
8,798

 
5,873

 
30,044

 
2,661

 
13,899

 
—

Guarantee and commitment fees(2)
8,867

 
356

 
851

 
180

 
—

 
(3,274
)
 
6,980

Other income/(expense)(3)
899

 
13

 
10

 
—

 
(349
)
 
(934
)
 
(361
)
Non-interest income/(loss)
9,766

 
369

 
861

 
180

 
(349
)
 
(4,208
)
 
6,619

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
7

 
—

 
—

 
—

 
—

 
—

 
7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
(179
)
 
—

 
—

 
—

 
—

 
—

 
(179
)
Other non-interest expense
(9,474
)
 
(2,505
)
 
(1,412
)
 
(3,876
)
 
(7,117
)
 
—

 
(24,384
)
Non-interest expense(5)
(9,653
)
 
(2,505
)
 
(1,412
)
 
(3,876
)
 
(7,117
)
 
—

 
(24,563
)
Core earnings before income taxes
26,007

 
6,662

 
5,322

 
26,348

 
(4,805
)
 
9,691

(6) 
69,225

Income tax (expense)/benefit
(5,461
)
 
(1,399
)
 
(1,118
)
 
(5,533
)
 
1,775

 
(2,034
)
 
(13,770
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
20,546

 
5,263

 
4,204

 
20,815

 
(3,030
)
 
7,657

(6) 
55,455

Preferred stock dividends
—

 
—

 
—

 
—

 
(6,591
)
 
—

 
(6,591
)
Segment core earnings/(losses)
$
20,546

 
$
5,263

 
$
4,204

 
$
20,815

 
$
(9,621
)
 
$
7,657

(6) 
$
48,864

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
4,428,172

 
$
2,177,345

 
$
995,068

 
$
8,144,763

 
$
2,881,423

 
$
—

 
$
18,626,771

Total on- and off-balance sheet program assets at principal balance
$
7,045,397

 
$
2,418,115

 
$
1,669,440

 
$
8,391,885

 
—

 
—

 
$
19,524,837

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(6) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.



Core Earnings by Business Segment
For the Six Months Ended June 30, 2017
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
26,092

 
$
10,459

 
$
5,951

 
$
28,933

 
$
5,367

 
$
—

 
$
76,802

Less: reconciling adjustments(1)(2)(3)(4)
(4,423
)
 
(1,347
)
 
(714
)
 
(1,851
)
 
(607
)
 
8,942

 
—

Net effective spread
21,669

 
9,112

 
5,237

 
27,082

 
4,760

 
8,942

 
—

Guarantee and commitment fees(2)
8,486

 
173

 
979

 
620

 
—

 
(2,942
)
 
7,316

Other income/(expense)(3)(5)
1,188

 
25

 
10

 
—

 
121

 
1,880

 
3,224

Non-interest income/(loss)
9,674

 
198

 
989

 
620

 
121

 
(1,062
)
 
10,540

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
(964
)
 
—

 
—

 
—

 
—

 
—

 
(964
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
54

 
—

 
—

 
—

 
—

 
—

 
54

Other non-interest expense
(8,511
)
 
(2,253
)
 
(1,230
)
 
(3,143
)
 
(6,856
)
 
—

 
(21,993
)
Non-interest expense(6)
(8,457
)
 
(2,253
)
 
(1,230
)
 
(3,143
)
 
(6,856
)
 
—

 
(21,939
)
Core earnings before income taxes
21,922

 
7,057

 
4,996

 
24,559

 
(1,975
)
 
7,880

(7) 
64,439

Income tax (expense)/benefit
(7,673
)
 
(2,470
)
 
(1,748
)
 
(8,596
)
 
1,336

 
(2,759
)
 
(21,910
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
14,249

 
4,587

 
3,248

 
15,963

 
(639
)
 
5,121

(7) 
42,529

Preferred stock dividends
—

 
—

 
—

 
—

 
(6,591
)
 
—

 
(6,591
)
Non-controlling interest
—

 
—

 
—

 
—

 
165

 
—

 
165

Segment core earnings/(losses)
$
14,249

 
$
4,587

 
$
3,248

 
$
15,963

 
$
(7,065
)
 
$
5,121

(7) 
$
36,103

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
3,958,344

 
$
2,141,569

 
$
1,038,383

 
$
7,425,774

 
$
2,703,315

 
$
—

 
$
17,267,385

Total on- and off-balance sheet program assets at principal balance
$
6,426,518

 
$
2,237,013

 
$
1,883,909

 
$
7,711,418

 
—

 
—

 
$
18,258,858

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes reconciling adjustments for fair value adjustments on financial derivatives and trading assets. Also includes a reconciling adjustment related to the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.
(6) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(7) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.
Schedule of Segment Reporting Information, by Segment [Table Text Block]
Table 9.1
Core Earnings by Business Segment
For the Three Months Ended June 30, 2018
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
15,889

 
$
5,072

 
$
3,313

 
$
18,805

 
$
854

 
$
—

 
$
43,933

Less: reconciling adjustments(1)(2)(3)(4)
(2,542
)
 
(674
)
 
(390
)
 
(3,585
)
 
(580
)
 
7,771

 
—

Net effective spread
13,347

 
4,398

 
2,923

 
15,220

 
274

 
7,771

 
—

Guarantee and commitment fees(2)
4,488

 
190

 
402

 
91

 
—

 
(1,690
)
 
3,481

Other income/(expense)(3)
341

 
8

 
5

 
—

 
(209
)
 
2,754

 
2,899

Non-interest income/(loss)
4,829

 
198

 
407

 
91

 
(209
)
 
1,064

 
6,380

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
(424
)
 
—

 
—

 
—

 
—

 
—

 
(424
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
(158
)
 
—

 
—

 
—

 
—

 
—

 
(158
)
Other non-interest expense
(4,954
)
 
(1,312
)
 
(739
)
 
(2,030
)
 
(3,728
)
 
—

 
(12,763
)
Non-interest expense(5)
(5,112
)
 
(1,312
)
 
(739
)
 
(2,030
)
 
(3,728
)
 
—

 
(12,921
)
Core earnings before income taxes
12,640

 
3,284

 
2,591

 
13,281

 
(3,663
)
 
8,835

(6) 
36,968

Income tax (expense)/benefit
(2,654
)
 
(690
)
 
(544
)
 
(2,789
)
 
1,200

 
(1,855
)
 
(7,332
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
9,986

 
2,594

 
2,047

 
10,492

 
(2,463
)
 
6,980

(6) 
29,636

Preferred stock dividends
—

 
—

 
—

 
—

 
(3,296
)
 
—

 
(3,296
)
Segment core earnings/(losses)
$
9,986

 
$
2,594

 
$
2,047

 
$
10,492

 
$
(5,759
)
 
$
6,980

(6) 
$
26,340

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
4,428,172

 
$
2,177,345

 
$
995,068

 
$
8,144,763

 
$
2,881,423

 
$
—

 
$
18,626,771

Total on- and off-balance sheet program assets at principal balance
$
7,045,397

 
$
2,418,115

 
$
1,669,440

 
$
8,391,885

 
—

 
—

 
$
19,524,837

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(6) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.


Core Earnings by Business Segment
For the Three Months Ended June 30, 2017
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
13,338

 
$
5,176

 
$
3,003

 
$
15,431

 
$
2,783

 
$
—

 
$
39,731

Less: reconciling adjustments(1)(2)(3)(4)
(2,180
)
 
(625
)
 
(334
)
 
(964
)
 
(294
)
 
4,397

 
—

Net effective spread
11,158

 
4,551

 
2,669

 
14,467

 
2,489

 
4,397

 
—

Guarantee and commitment fees(2)
4,191

 
99

 
487

 
165

 
—

 
(1,470
)
 
3,472

Other income/(expense)(3)(5)
994

 
11

 
5

 
—

 
(146
)
 
(592
)
 
272

Non-interest income/(loss)
5,185

 
110

 
492

 
165

 
(146
)
 
(2,062
)
 
3,744

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
(327
)
 
—

 
—

 
—

 
—

 
—

 
(327
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
(139
)
 
—

 
—

 
—

 
—

 
—

 
(139
)
Other non-interest expense
(4,446
)
 
(1,166
)
 
(643
)
 
(1,622
)
 
(3,374
)
 
—

 
(11,251
)
Non-interest expense(6)
(4,585
)
 
(1,166
)
 
(643
)
 
(1,622
)
 
(3,374
)
 
—

 
(11,390
)
Core earnings before income taxes
11,431

 
3,495

 
2,518

 
13,010

 
(1,031
)
 
2,335

(7) 
31,758

Income tax (expense)/benefit
(4,001
)
 
(1,223
)
 
(881
)
 
(4,554
)
 
352

 
(817
)
 
(11,124
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
7,430

 
2,272

 
1,637

 
8,456

 
(679
)
 
1,518

(7) 
20,634

Preferred stock dividends
—

 
—

 
—

 
—

 
(3,296
)
 
—

 
(3,296
)
Non-controlling interest
—

 
—

 
—

 
—

 
150

 
—

 
150

Segment core earnings/(losses)
$
7,430

 
$
2,272

 
$
1,637

 
$
8,456

 
$
(3,825
)
 
$
1,518

(7) 
$
17,488

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
3,958,344

 
$
2,141,569

 
$
1,038,383

 
$
7,425,774

 
$
2,703,315

 
$
—

 
$
17,267,385

Total on- and off-balance sheet program assets at principal balance
$
6,426,518

 
$
2,237,013

 
$
1,883,909

 
$
7,711,418

 
$
—

 
$
—

 
$
18,258,858

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes reconciling adjustments for fair value adjustments on financial derivatives and trading assets. Also includes a reconciling adjustment related to the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.
(6) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(7) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.

Core Earnings by Business Segment
For the Six Months Ended June 30, 2018
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
30,830

 
$
10,142

 
$
5,850

 
$
36,637

 
$
3,703

 
$
—

 
$
87,162

Less: reconciling adjustments(1)(2)(3)(4)
(4,943
)
 
(1,344
)
 
23

 
(6,593
)
 
(1,042
)
 
13,899

 
—

Net effective spread
25,887

 
8,798

 
5,873

 
30,044

 
2,661

 
13,899

 
—

Guarantee and commitment fees(2)
8,867

 
356

 
851

 
180

 
—

 
(3,274
)
 
6,980

Other income/(expense)(3)
899

 
13

 
10

 
—

 
(349
)
 
(934
)
 
(361
)
Non-interest income/(loss)
9,766

 
369

 
861

 
180

 
(349
)
 
(4,208
)
 
6,619

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
7

 
—

 
—

 
—

 
—

 
—

 
7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
(179
)
 
—

 
—

 
—

 
—

 
—

 
(179
)
Other non-interest expense
(9,474
)
 
(2,505
)
 
(1,412
)
 
(3,876
)
 
(7,117
)
 
—

 
(24,384
)
Non-interest expense(5)
(9,653
)
 
(2,505
)
 
(1,412
)
 
(3,876
)
 
(7,117
)
 
—

 
(24,563
)
Core earnings before income taxes
26,007

 
6,662

 
5,322

 
26,348

 
(4,805
)
 
9,691

(6) 
69,225

Income tax (expense)/benefit
(5,461
)
 
(1,399
)
 
(1,118
)
 
(5,533
)
 
1,775

 
(2,034
)
 
(13,770
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
20,546

 
5,263

 
4,204

 
20,815

 
(3,030
)
 
7,657

(6) 
55,455

Preferred stock dividends
—

 
—

 
—

 
—

 
(6,591
)
 
—

 
(6,591
)
Segment core earnings/(losses)
$
20,546

 
$
5,263

 
$
4,204

 
$
20,815

 
$
(9,621
)
 
$
7,657

(6) 
$
48,864

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
4,428,172

 
$
2,177,345

 
$
995,068

 
$
8,144,763

 
$
2,881,423

 
$
—

 
$
18,626,771

Total on- and off-balance sheet program assets at principal balance
$
7,045,397

 
$
2,418,115

 
$
1,669,440

 
$
8,391,885

 
—

 
—

 
$
19,524,837

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(6) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.



Core Earnings by Business Segment
For the Six Months Ended June 30, 2017
 
Farm & Ranch
 
USDA Guarantees
 
Rural 
Utilities
 
Institutional Credit
 
Corporate
 
Reconciling
Adjustments
 
Consolidated Net Income
 
(in thousands)
Net interest income
$
26,092

 
$
10,459

 
$
5,951

 
$
28,933

 
$
5,367

 
$
—

 
$
76,802

Less: reconciling adjustments(1)(2)(3)(4)
(4,423
)
 
(1,347
)
 
(714
)
 
(1,851
)
 
(607
)
 
8,942

 
—

Net effective spread
21,669

 
9,112

 
5,237

 
27,082

 
4,760

 
8,942

 
—

Guarantee and commitment fees(2)
8,486

 
173

 
979

 
620

 
—

 
(2,942
)
 
7,316

Other income/(expense)(3)(5)
1,188

 
25

 
10

 
—

 
121

 
1,880

 
3,224

Non-interest income/(loss)
9,674

 
198

 
989

 
620

 
121

 
(1,062
)
 
10,540

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
(964
)
 
—

 
—

 
—

 
—

 
—

 
(964
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for reserve for losses
54

 
—

 
—

 
—

 
—

 
—

 
54

Other non-interest expense
(8,511
)
 
(2,253
)
 
(1,230
)
 
(3,143
)
 
(6,856
)
 
—

 
(21,993
)
Non-interest expense(6)
(8,457
)
 
(2,253
)
 
(1,230
)
 
(3,143
)
 
(6,856
)
 
—

 
(21,939
)
Core earnings before income taxes
21,922

 
7,057

 
4,996

 
24,559

 
(1,975
)
 
7,880

(7) 
64,439

Income tax (expense)/benefit
(7,673
)
 
(2,470
)
 
(1,748
)
 
(8,596
)
 
1,336

 
(2,759
)
 
(21,910
)
Core earnings before preferred stock dividends and attribution of income to non-controlling interest
14,249

 
4,587

 
3,248

 
15,963

 
(639
)
 
5,121

(7) 
42,529

Preferred stock dividends
—

 
—

 
—

 
—

 
(6,591
)
 
—

 
(6,591
)
Non-controlling interest
—

 
—

 
—

 
—

 
165

 
—

 
165

Segment core earnings/(losses)
$
14,249

 
$
4,587

 
$
3,248

 
$
15,963

 
$
(7,065
)
 
$
5,121

(7) 
$
36,103

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets at carrying value
$
3,958,344

 
$
2,141,569

 
$
1,038,383

 
$
7,425,774

 
$
2,703,315

 
$
—

 
$
17,267,385

Total on- and off-balance sheet program assets at principal balance
$
6,426,518

 
$
2,237,013

 
$
1,883,909

 
$
7,711,418

 
—

 
—

 
$
18,258,858

(1) 
Excludes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts.
(2) 
Includes the reclassification of interest income and interest expense from consolidated trusts owned by third parties to guarantee and commitment fees, to reflect management's view that the net interest income Farmer Mac earns is effectively a guarantee fee.
(3) 
Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains/(losses) on financial derivatives and hedging activities" on the consolidated financial statements, to determine the effective funding cost for each operating segment.
(4) 
Effective in fourth quarter 2017, Farmer Mac revised its methodology for calculating net effective spread, a component of core earnings, to also include the net effects of gains/(losses) due to terminations or net settlements on financial derivatives and hedging activities. All prior period information has been recast to reflect the revised methodology. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures—Net Effective Spread."
(5) 
Includes reconciling adjustments for fair value adjustments on financial derivatives and trading assets. Also includes a reconciling adjustment related to the recognition of deferred gains over the estimated lives of certain Farmer Mac Guaranteed Securities and USDA Securities.
(6) 
Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount.
(7) 
Net adjustments to reconcile to the corresponding income measures: core earnings before income taxes reconciled to income before income taxes; core earnings before preferred stock dividends and attribution of income to non-controlling interest reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.