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Business Segment Reporting | 12 Months Ended
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Dec. 31, 2019
Segment Reporting [Abstract] |
BUSINESS SEGMENT REPORTING | BUSINESS SEGMENT REPORTING Farmer Mac's operations consist of four operating segments – Farm & Ranch, USDA Guarantees, Rural Utilities, and Institutional Credit. The Institutional Credit segment comprises Farmer Mac's purchases and guarantees of AgVantage securities related to general obligations of lenders that are secured by pools of eligible loans. Each segment is based on distinct products and distinct business activities. In addition to these four operating segments, a corporate segment is presented. That segment represents activity in Farmer Mac's investment portfolio and other corporate activities. Each operating segment's financial results include directly attributable revenues and expenses. Corporate charges for administrative expenses that are not directly attributable to an operating segment are allocated to each segment based on headcount. Farmer Mac uses core earnings to measure corporate economic performance and develop financial plans because, in management's view, core earnings is a useful alternative measure in understanding Farmer Mac's economic performance, transaction economics, and business trends. Core earnings principally differs from net income attributable to common stockholders by excluding the effects of fair value fluctuations, which are not expected to have a cumulative net impact on financial condition or results of operations reported in accordance with generally accepted accounting principles if the related financial instruments are held to maturity, as is generally expected. Core earnings also differs from net income attributable to common stockholders by excluding specified infrequent or unusual transactions that Farmer Mac believes are not indicative of future operating results and that may not reflect the trends and economic financial performance of Farmer Mac's core business. This corporate economic performance measure may not be comparable to similarly labeled measures disclosed by other companies. Farmer Mac uses net effective spread to measure the net spread Farmer Mac earns between its interest-earning assets and the related net funding costs of these assets. Net effective spread differs from net interest income and net interest yield because it excludes: (1) the amortization of premiums and discounts on assets consolidated at fair value that are amortized as adjustments to yield in interest income over the contractual or estimated remaining lives of the underlying assets; (2) interest income and interest expense related to consolidated trusts with beneficial interests owned by third parties, which are presented on Farmer Mac's consolidated balance sheets as "Loans held for investment in consolidated trusts, at amortized cost"; and (3) the fair value changes of financial derivatives and the corresponding assets or liabilities designated in a fair value hedge accounting relationship. The financial information presented below reflects the accounts of Farmer Mac and its subsidiaries on a consolidated basis. Accordingly, the core earnings for Farmer Mac's reportable operating segments will differ from the stand-alone financial statements of Farmer Mac's subsidiaries. These differences will be due to various factors, including the exclusion of unrealized gains and losses related to fair value changes of trading assets and financial derivatives, as well as the allocation of certain expenses such as dividends and interest expense related to the issuance of capital and the issuance of indebtedness managed at the corporate level. The allocation of general and administrative expenses that are not directly attributable to an operating segment may also result in differences. The following tables present core earnings for Farmer Mac's operating segments and a reconciliation to consolidated net income for the years ended December 31, 2019, 2018, and 2017: Table 14.1
Core Earnings by Business Segment |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |
| Farm & Ranch |  | USDA Guarantees |  | Rural Utilities |  | Institutional Credit |  | Corporate |  | Reconciling Adjustments |  | Consolidated Net Income
| (in thousands) |  |  |  |  |  |  |  |  |  |  |  |
Net interest income | $ | 65,098 |  |  | $ | 17,470 |  |  | $ | 10,459 |  |  | $ | 69,039 |  |  | $ | 11,069 |  |  | $ | — |  |  | $ | 173,135 |
Less: reconciling adjustments(1)(2)(3) | (9,471) |  |  | (732) |  |  | 6,143 |  |  | 520 |  |  | (987) |  |  | 4,527 |  |  | — |
Net effective spread | 55,627 |  |  | 16,738 |  |  | 16,602 |  |  | 69,559 |  |  | 10,082 |  |  | 4,527 |  |  | — |
Guarantee and commitment fees(2) | 18,593 |  |  | 958 |  |  | 1,412 |  |  | 372 |  |  | — |  |  | (7,669) |  |  | 13,666 |
Other income/(expense)(3) | 1,397 |  |  | 174 |  |  | 38 |  |  | — |  |  | 166 |  |  | 5,501 |  |  | 7,276 |
Non-interest income/(loss) | 19,990 |  |  | 1,132 |  |  | 1,450 |  |  | 372 |  |  | 166 |  |  | (2,168) |  |  | 20,942 |
Provision for loan losses | (3,504) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (3,504) |
Release of reserve for losses | 3 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3 |
Other non-interest expense | (19,375) |  |  | (5,757) |  |  | (3,898) |  |  | (8,390) |  |  | (14,505) |  |  | — |  |  | (51,925) |
Non-interest expense(4) | (19,372) |  |  | (5,757) |  |  | (3,898) |  |  | (8,390) |  |  | (14,505) |  |  | — |  |  | (51,922) |
Core earnings before income taxes | 52,741 |  |  | 12,113 |  |  | 14,154 |  |  | 61,541 |  |  | (4,257) |  |  | 2,359 |  | (5) | 138,651 |
Income tax (expense)/benefit | (11,076) |  |  | (2,545) |  |  | (2,972) |  |  | (12,924) |  |  | 907 |  |  | (495) |  |  | (29,105) |
Core earnings before preferred stock dividends | 41,665 |  |  | 9,568 |  |  | 11,182 |  |  | 48,617 |  |  | (3,350) |  |  | 1,864 |  | (5) | 109,546 |
Preferred stock dividends | — |  |  | — |  |  | — |  |  | — |  |  | (13,940) |  |  | — |  |  | (13,940) |
Loss on retirement of preferred stock | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (1,956) |  |  | (1,956) |
Segment core earnings/(losses) | $ | 41,665 |  |  | $ | 9,568 |  |  | $ | 11,182 |  |  | $ | 48,617 |  |  | $ | (17,290) |  |  | $ | (92) |  | (5) | $ | 93,650 |
Total assets at carrying value | $ | 5,408,302 |  |  | $ | 2,311,932 |  |  | $ | 1,717,405 |  |  | $ | 8,606,912 |  |  | $ | 3,664,823 |  |  | $ | — |  |  | $ | 21,709,374 |
Total on- and off-balance sheet program assets at principal balance | $ | 7,776,950 |  |  | $ | 2,620,175 |  |  | $ | 2,280,571 |  |  | $ | 8,440,246 |  |  | $ | — |  |  | $ | — |  |  | $ | 21,117,942 |
(1)Includes 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" on the consolidated financial statements, to determine the effective funding cost for each operating segment. (4)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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 reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.
Core Earnings by Business Segment |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2018 |  |  |  |  |  |  |  |  |  |  |  |  |
| Farm & Ranch |  | USDA Guarantees |  | Rural Utilities |  | Institutional Credit |  | Corporate |  | Reconciling Adjustments |  | Consolidated Net Income
| (in thousands) |  |  |  |  |  |  |  |  |  |  |  |
Net interest income | $ | 62,951 |  |  | $ | 20,554 |  |  | $ | 12,505 |  |  | $ | 69,321 |  |  | $ | 9,105 |  |  | $ | — |  |  | $ | 174,436 |
Less: reconciling adjustments(1)(2)(3) | (9,889) |  |  | (2,499) |  |  | (922) |  |  | (7,884) |  |  | (2,047) |  |  | 23,241 |  |  | — |
Net effective spread | 53,062 |  |  | 18,055 |  |  | 11,583 |  |  | 61,437 |  |  | 7,058 |  |  | 23,241 |  |  | — |
Guarantee and commitment fees(2) | 17,976 |  |  | 797 |  |  | 1,599 |  |  | 360 |  |  | — |  |  | (6,756) |  |  | 13,976 |
Other income/(expense)(3) | 1,371 |  |  | 20 |  |  | 33 |  |  | — |  |  | (913) |  |  | (2,747) |  |  | (2,236) |
Non-interest income/(loss) | 19,347 |  |  | 817 |  |  | 1,632 |  |  | 360 |  |  | (913) |  |  | (9,503) |  |  | 11,740 |
Provision for loan losses | (238) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (238) |
Provision for reserve for losses | (97) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (97) |
Other non-interest expense | (19,026) |  |  | (5,309) |  |  | (3,062) |  |  | (8,011) |  |  | (14,411) |  |  | — |  |  | (49,819) |
Non-interest expense(4) | (19,123) |  |  | (5,309) |  |  | (3,062) |  |  | (8,011) |  |  | (14,411) |  |  | — |  |  | (49,916) |
Core earnings before income taxes | 53,048 |  |  | 13,563 |  |  | 10,153 |  |  | 53,786 |  |  | (8,266) |  |  | 13,738 |  | (5) | 136,022 |
Income tax (expense)/benefit | (11,140) |  |  | (2,848) |  |  | (2,133) |  |  | (11,295) |  |  | 2,361 |  |  | (2,887) |  |  | (27,942) |
Core earnings before preferred stock dividends | 41,908 |  |  | 10,715 |  |  | 8,020 |  |  | 42,491 |  |  | (5,905) |  |  | 10,851 |  | (5) | 108,080 |
Preferred stock dividends | — |  |  | — |  |  | — |  |  | — |  |  | (13,182) |  |  | — |  |  | (13,182) |
Segment core earnings/(losses) | $ | 41,908 |  |  | $ | 10,715 |  |  | $ | 8,020 |  |  | $ | 42,491 |  |  | $ | (19,087) |  |  | $ | 10,851 |  | (5) | $ | 94,898 |
Total assets at carrying value | $ | 4,701,736 |  |  | $ | 2,240,906 |  |  | $ | 945,282 |  |  | $ | 8,089,410 |  |  | $ | 2,716,994 |  |  | $ | — |  |  | $ | 18,694,328 |
Total on- and off-balance sheet program assets at principal balance | $ | 7,233,972 |  |  | $ | 2,515,620 |  |  | $ | 1,592,115 |  |  | $ | 8,382,817 |  |  | $ | — |  |  | $ | — |  |  | $ | 19,724,524 |
(1)Includes 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" on the consolidated financial statements, to determine the effective funding cost for each operating segment. (4)Includes directly attributable costs and an allocation of indirectly attributable costs based on employee headcount. (5)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 reconciled to net income; and segment core earnings reconciled to net income attributable to common stockholders.
Core Earnings by Business Segment |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Year Ended December 31, 2017 |  |  |  |  |  |  |  |  |  |  |  |  |
| Farm & Ranch |  | USDA Guarantees |  | Rural Utilities |  | Institutional Credit |  | Corporate |  | Reconciling Adjustments |  | Consolidated Net Income
| (in thousands) |  |  |  |  |  |  |  |  |  |  |  |
Net interest income | $ | 54,290 |  |  | $ | 21,106 |  |  | $ | 11,598 |  |  | $ | 59,842 |  |  | $ | 10,811 |  |  | $ | — |  |  | $ | 157,647 |
Less: reconciling adjustments(1)(2)(3) | (8,922) |  |  | (2,287) |  |  | (539) |  |  | (3,505) |  |  | (1,091) |  |  | 16,344 |  |  | — |
Net effective spread | 45,368 |  |  | 18,819 |  |  | 11,059 |  |  | 56,337 |  |  | 9,720 |  |  | 16,344 |  |  | — |
Guarantee and commitment fees(2) | 17,175 |  |  | 456 |  |  | 1,914 |  |  | 805 |  |  | — |  |  | (6,236) |  |  | 14,114 |
Other income(3)(4) | 2,449 |  |  | 43 |  |  | 20 |  |  | — |  |  | 171 |  |  | 715 |  |  | 3,398 |
Non-interest income/(loss) | 19,624 |  |  | 499 |  |  | 1,934 |  |  | 805 |  |  | 171 |  |  | (5,521) |  |  | 17,512 |
Provision for loan losses | (1,708) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (1,708) |
Provision for reserve for losses | (50) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (50) |
Other non-interest expense | (16,554) |  |  | (4,384) |  |  | (2,430) |  |  | (6,439) |  |  | (12,908) |  |  | — |  |  | (42,715) |
Non-interest expense(5) | (16,604) |  |  | (4,384) |  |  | (2,430) |  |  | (6,439) |  |  | (12,908) |  |  | — |  |  | (42,765) |
Core earnings before income taxes | 46,680 |  |  | 14,934 |  |  | 10,563 |  |  | 50,703 |  |  | (3,017) |  |  | 10,823 |  | (6) | 130,686 |
Income tax (expense)/benefit | (16,338) |  |  | (5,227) |  |  | (3,696) |  |  | (17,746) |  |  | 1,792 |  |  | (5,154) |  |  | (46,369) |
Core earnings before preferred stock dividends and attribution of income to non-controlling interest | 30,342 |  |  | 9,707 |  |  | 6,867 |  |  | 32,957 |  |  | (1,225) |  |  | 5,669 |  | (6) | 84,317 |
Preferred stock dividends | — |  |  | — |  |  | — |  |  | — |  |  | (13,182) |  |  | — |  |  | (13,182) |
Non-controlling interest | — |  |  | — |  |  | — |  |  | — |  |  | 165 |  |  | — |  |  | 165 |
Segment core earnings/(losses) | $ | 30,342 |  |  | $ | 9,707 |  |  | $ | 6,867 |  |  | $ | 32,957 |  |  | $ | (14,242) |  |  | $ | 5,669 |  | (6) | $ | 71,300 |
Total assets at carrying value | $ | 4,274,693 |  |  | $ | 2,195,189 |  |  | $ | 1,088,986 |  |  | $ | 7,627,749 |  |  | $ | 2,605,657 |  |  | $ | — |  |  | $ | 17,792,274 |
Total on- and off-balance sheet program assets at principal balance | $ | 6,867,586 |  |  | $ | 2,352,214 |  |  | $ | 1,882,633 |  |  | $ | 7,904,878 |  |  | — |  |  | — |  |  | $ | 19,007,311 |
(1)Includes 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" on the consolidated financial statements, to determine the effective funding cost for each operating segment. (4)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. (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.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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