MidAtlantic Farm Credit, a members-owned cooperative and a lending institution of the nation-wide Farm Credit System, recently announced financial results for the first quarter of 2012.
Net income for the quarter was $10.7 million compared with $10.8 million for the first quarter of 2011. Net interest income for the first quarter was $16.8 million, the same as in the first quarter last year. Average loan volume for the first quarter was $2.187 billion, compared to $2.306 billion for the same period in 2011.
“Agricultural producers in our area are doing fairly well,” said Bob Frazee, president and CEO of MidAtlantic. “Commodity prices are generally good, and we’ve seen our membership strengthening their operations by managing their expenses and paying down some of their debt. In addition, the lack of growth in the housing sector is impacting some of our industries—especially nurseries and greenhouses, sawmilling, and timber.”
Members have been cautious about incurring more debt in MidAtlantic’s five-state territory; the lender’s portfolio has been showing a positive trend in credit quality. Nonaccrual loans decreased to $64.4 million in the first quarter of 2012, compared to $69.6 million at December 31, 2011 and $85.2 million at March 31, 2011. The Association’s nonaccrual loans as a percentage of total loans also decreased to 3.00 percent at the end of the quarter, compared to 3.21 percent at the end of 2011.
“Since the peak during the third quarter of 2011–when we were managing over $90 million of nonaccrual loans–we have successfully worked with our borrowers to reduce the nonaccrual loans while helping to preserve other agriculture related activities which had some dependency on the stressed borrowers businesses,” said Frazee.
During the first quarter of 2012, the Association recorded a provision for loan losses of $1.75 million, compared to $2.0 million in the first quarter of 2011.
MidAtlantic’s capital ratios remain well in excess of regulatory minimums. At March 31, 2012, shareholder’s equity totaled $427.8 million, and the permanent capital ratio was 17.43 percent, compared with the 7.00 percent minimum mandated by the Farm Credit Administration (FCA).
About MidAtlantic Farm Credit
MidAtlantic Farm Credit (MidAtlantic) is one of the largest agricultural lenders on the East Coast. Their chartered territory includes parts of Delaware, Maryland, Pennsylvania, Virginia and West Virginia. They are part of the national Farm Credit System, a cooperative lender with more than 500,000 borrowers and a portfolio of over $178 billion. For more information about MidAtlantic, visit https://www.mafc.com.