MidAtlantic Farm Credit, a members-owned cooperative and an institution of the national Farm Credit system, recently reported their third quarter financial results for 2019.
Average accruing loan volume for the first nine months of 2019 was $2.77 billion, an increase of 2.25 percent compared to the same 2018 period. Net income for the quarter was $13.0 million, a 2.28 percent increase compared to the third quarter of 2018. For the first nine months of 2019, net income was $38.1 million, a 0.70 percent decrease from the same period in 2018. The difference was a result of higher distributions from the Farm Credit System Insurance Corporation in 2018 compared to 2019. Net interest income for the third quarter was $18.5 million, a 3.67 percent increase from the same time period in 2018.
Nonaccrual loans of $50.9 million at September 30, 2019 were up $7.4 million from December 31, 2018 and up $8.9 million from September 30, 2018. The Association’s nonaccrual loans as a percentage of total loans also increased to 1.79 percent at the end of the third quarter of 2019, compared to 1.51 percent at September 30, 2018. The Association recorded a $3 million provision for loan losses in the first nine months of 2019 and 2018. The allowance for loan losses represented 64.71 percent of nonaccrual loans at September 30, 2019, compared to 69.05 percent at September 30, 2018.
Thomas Truitt, Chief Executive Officer of MidAtlantic Farm Credit, states, “As we enter into the fourth quarter of the year, we remain optimistic for our members. Although net income for 2019 has decreased, our net income for the quarter increased, as well as average accruing loan volume, net interest, and nonaccrual loans.”
At September 30, 2019, shareholders’ equity totaled $661.9 million, up 4.24 percent from December 31, 2018, and the Total Capital Ratio was 21.79 percent. That number is compared with the 9.875 percent minimum mandated by the Farm Credit Administration (FCA), the lender’s independent regulator. The Association distributed cash patronage to its member-borrowers of $30.6 million so far in 2019.