The national secondary market for agricultural real estate loans continued its upward trend in production, but its net income followed a different path, decreasing by more than half.
The Federal Agricultural Mortgage Corporation (Farmer Mac) reported purchases, guarantees and commitments totaled $349.1 million for the third quarter. This figure represents an increase from the prior quarter's $322.3 million and the 2002 third quarter's $236.0 million.
The new business volume total was derived from three separate loan types in its portfolio. Long-term standby purchase commitments contributed the highest amount totaling $199.6 million, and Farmer Mac II followed with $106.7 million. While volume has increased for both of these sectors all year long, Farmer Mac I volume decreased, accounting $42.8 million of the third quarter's total, compared to the $65.6 million it contributed in the second quarter.
New business volume for the first nine months of the year amounted to $0.9 billion, a decrease from $1.6 billion during the same period last year, according to the Washington, D.C.-based company's latest report.
Furthermore, a company executive said in the announcement that "as a result of Farmer Mac's ongoing credit risk management efforts, 90-day delinquencies in Farmer Mac's portfolio were at their lowest levels in more than two years: $47.1 million…down from the September 30, 2002 levels of $79.8 million."
But, third quarter net income reportedly did not fare so well -- falling steeply to $3.3 million from the second quarter's $8.4 million. Net income in the third quarter in 2002 totaled $5.0 million, the company reported.