MidAtlantic Farm Credit, a members-owned cooperative and an institution of the national Farm Credit System, recently reported their first quarter financial results for 2015. Net income for the quarter was $10.8 million, a 2.1 percent increase compared to the first quarter of 2014. Net interest income for the first quarter was $16.6 million, a 1.4 percent decrease from the same time period in 2014. Average accruing loan volume for the first three months of 2015 was $2.2 billion, an increase of 3.4 percent compared to the same 2014 period.
“We continue to see improvement in the credit quality of our portfolio,” said John Wheeler, CFO of MidAtlantic Farm Credit. He noted that the credit quality of acceptable loans at the end of March 2015 was the highest percentage since the beginning of the recession in 2008.
Nonaccrual loans increased $.7 million in the first quarter of 2015 to $25.7 million, compared to $25.0 million at December 31, 2014 and $25.3 million at March 31, 2014. The association’s nonaccrual loans as a percentage of total loans remained at 1.1 percent at the end of the first quarter of 2015, compared to the end of 2014 and at March 31, 2014.
Bob Frazee, CEO of MidAtlantic Farm Credit, stated, “Our association continues to maintain steady quality loan growth in our marketplace. Over the past two years, accruing loan volume has increased $168 million or 8 percent, which evidences continuing economic recovery and demand for agricultural financing in our region.” Frazee continued, “Our margins, however, have been declining as there remains strong competition for loans in our sector.”
At March 31, 2015, shareholder’s equity totaled $525.6 million, up 1.5 percent from December 31, 2014, and the permanent capital ratio was 21.10 percent, compared with the 7.0 percent minimum mandated by the Farm Credit Administration (FCA), the Association’s independent regulators.