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Business Segment Reporting | 9 Months Ended
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Sep. 30, 2021
Segment Reporting [Abstract] |
BUSINESS SEGMENT REPORTING | BUSINESS SEGMENT REPORTING The following tables present core earnings for Farmer Mac's operating segments and a reconciliation to consolidated net income for the three and nine months ended September 30, 2021 and 2020: Table 10.1
Core Earnings by Business Segment
For the Three Months Ended September 30, 2021
| Farm & Ranch |  | USDA Guarantees |  | Rural Utilities |  | Institutional Credit |  | Corporate |  | Reconciling Adjustments |  | Consolidated Net Income
| (in thousands)
Net interest income | $ | 24,893 |  |  | $ | 6,449 |  |  | $ | 7,018 |  |  | $ | 13,707 |  |  | $ | 2,938 |  |  | $ | — |  |  | $ | 55,005 |
Less: reconciling adjustments(1)(2)(3) | (526) |  |  | 398 |  |  | (554) |  |  | 1,652 |  |  | (50) |  |  | (920) |  |  | — |
Net effective spread | 24,367 |  |  | 6,847 |  |  | 6,464 |  |  | 15,359 |  |  | 2,888 |  |  | (920) |  |  | — |
Guarantee and commitment fees(2) | 3,831 |  |  | 166 |  |  | 320 |  |  | 5 |  |  | — |  |  | (1,167) |  |  | 3,155 |
Other income/(expense)(3) | 405 |  |  | 152 |  |  | 2 |  |  | — |  |  | 128 |  |  | (2,162) |  |  | (1,475) |
Non-interest income/(loss) | 4,236 |  |  | 318 |  |  | 322 |  |  | 5 |  |  | 128 |  |  | (3,329) |  |  | 1,680 |
(Provision for)/release of losses | (414) |  |  | — |  |  | 120 |  |  | (78) |  |  | 6 |  |  | — |  |  | (366) |
Release of reserve for losses | 91 |  |  | — |  |  | 20 |  |  | — |  |  | — |  |  | — |  |  | 111 |
Other non-interest expense | (6,275) |  |  | (2,284) |  |  | (1,889) |  |  | (2,514) |  |  | (4,145) |  |  | — |  |  | (17,107) |
Non-interest expense(4) | (6,184) |  |  | (2,284) |  |  | (1,869) |  |  | (2,514) |  |  | (4,145) |  |  | — |  |  | (16,996) |
Core earnings before income taxes | 22,005 |  |  | 4,881 |  |  | 5,037 |  |  | 12,772 |  |  | (1,123) |  |  | (4,249) |  | (5) | 39,323 |
Income tax (expense)/benefit | (4,621) |  |  | (1,025) |  |  | (1,058) |  |  | (2,682) |  |  | 234 |  |  | 892 |  |  | (8,260) |
Core earnings before preferred stock dividends | 17,384 |  |  | 3,856 |  |  | 3,979 |  |  | 10,090 |  |  | (889) |  |  | (3,357) |  | (5) | 31,063 |
Preferred stock dividends | — |  |  | — |  |  | — |  |  | — |  |  | (6,774) |  |  | — |  |  | (6,774) |
Segment core earnings/(losses) | $ | 17,384 |  |  | $ | 3,856 |  |  | $ | 3,979 |  |  | $ | 10,090 |  |  | $ | (7,663) |  |  | $ | (3,357) |  | (5) | $ | 24,289 |
Total assets at carrying value | $ | 6,883,879 |  |  | $ | 2,522,382 |  |  | $ | 2,249,071 |  |  | $ | 8,395,286 |  |  | $ | 4,693,750 |  |  | $ | — |  |  | $ | 24,744,368 |
Total on- and off-balance sheet program assets at principal balance | $ | 9,445,359 |  |  | $ | 2,722,702 |  |  | $ | 2,817,427 |  |  | $ | 8,133,303 |  |  | $ | — |  |  | $ | — |  |  | $ | 23,118,791 |
(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 "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 Three Months Ended September 30, 2020
| Farm & Ranch |  | USDA Guarantees |  | Rural Utilities |  | Institutional Credit |  | Corporate |  | Reconciling Adjustments |  | Consolidated Net Income
| (in thousands)
Net interest income | $ | 18,093 |  |  | $ | 4,747 |  |  | $ | 5,709 |  |  | $ | 14,171 |  |  | $ | 1,941 |  |  | $ | — |  |  | $ | 44,661 |
Less: reconciling adjustments(1)(2)(3) | (68) |  |  | 1,118 |  |  | 1,230 |  |  | 4,430 |  |  | 431 |  |  | (7,141) |  |  | — |
Net effective spread | 18,025 |  |  | 5,865 |  |  | 6,939 |  |  | 18,601 |  |  | 2,372 |  |  | (7,141) |  |  | — |
Guarantee and commitment fees(2) | 4,111 |  |  | 213 |  |  | 328 |  |  | 7 |  |  | — |  |  | (1,500) |  |  | 3,159 |
Other income/(expense)(3) | 443 |  |  | 135 |  |  | — |  |  | — |  |  | (125) |  |  | (681) |  |  | (228) |
Non-interest income/(loss) | 4,554 |  |  | 348 |  |  | 328 |  |  | 7 |  |  | (125) |  |  | (2,181) |  |  | 2,931 |
Release of/(provision for) losses | 300 |  |  | — |  |  | (1,182) |  |  | 228 |  |  | 1 |  |  | — |  |  | (653) |
(Provision for)/release of reserve for losses | (628) |  |  | — |  |  | 81 |  |  | — |  |  | — |  |  | — |  |  | (547) |
Other non-interest expense | (5,381) |  |  | (1,643) |  |  | (1,438) |  |  | (2,160) |  |  | (3,938) |  |  | — |  |  | (14,560) |
Non-interest expense(4) | (6,009) |  |  | (1,643) |  |  | (1,357) |  |  | (2,160) |  |  | (3,938) |  |  | — |  |  | (15,107) |
Core earnings before income taxes | 16,870 |  |  | 4,570 |  |  | 4,728 |  |  | 16,676 |  |  | (1,690) |  |  | (9,322) |  | (5) | 31,832 |
Income tax (expense)/benefit | (3,543) |  |  | (960) |  |  | (993) |  |  | (3,502) |  |  | 701 |  |  | 1,957 |  |  | (6,340) |
Core earnings before preferred stock dividends | 13,327 |  |  | 3,610 |  |  | 3,735 |  |  | 13,174 |  |  | (989) |  |  | (7,365) |  | (5) | 25,492 |
Preferred stock dividends | — |  |  | — |  |  | — |  |  | — |  |  | (5,166) |  |  | — |  |  | (5,166) |
Loss on retirement of preferred stock | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (1,667) |  |  | (1,667) |
Segment core earnings/(losses) | $ | 13,327 |  |  | $ | 3,610 |  |  | $ | 3,735 |  |  | $ | 13,174 |  |  | $ | (6,155) |  |  | $ | (9,032) |  | (5) | $ | 18,659 |
Total assets at carrying value | $ | 5,961,307 |  |  | $ | 2,487,687 |  |  | $ | 2,256,011 |  |  | $ | 8,716,923 |  |  | $ | 4,576,909 |  |  | $ | — |  |  | $ | 23,998,837 |
Total on- and off-balance sheet program assets at principal balance | $ | 8,249,349 |  |  | $ | 2,735,128 |  |  | $ | 2,685,309 |  |  | $ | 8,319,502 |  |  | $ | — |  |  | $ | — |  |  | $ | 21,989,288 |
(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 "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 Nine Months Ended September 30, 2021
| Farm & Ranch |  | USDA Guarantees |  | Rural Utilities |  | Institutional Credit |  | Corporate |  | Reconciling Adjustments |  | Consolidated Net Income
| (in thousands)
Net interest income | $ | 70,805 |  |  | $ | 18,227 |  |  | $ | 19,995 |  |  | $ | 46,124 |  |  | $ | 8,234 |  |  | $ | — |  |  | $ | 163,385 |
Less: reconciling adjustments(1)(2)(3) | (1,006) |  |  | 1,969 |  |  | (242) |  |  | 2,039 |  |  | 190 |  |  | (2,950) |  |  | — |
Net effective spread | 69,799 |  |  | 20,196 |  |  | 19,753 |  |  | 48,163 |  |  | 8,424 |  |  | (2,950) |  |  | — |
Guarantee and commitment fees(2) | 11,403 |  |  | 522 |  |  | 956 |  |  | 15 |  |  | — |  |  | (3,714) |  |  | 9,182 |
Other income/(expense)(3) | 1,118 |  |  | 441 |  |  | 3 |  |  | — |  |  | (123) |  |  | (744) |  |  | 695 |
Non-interest income/(loss) | 12,521 |  |  | 963 |  |  | 959 |  |  | 15 |  |  | (123) |  |  | (4,458) |  |  | 9,877 |
Release of/(provision for) losses | 239 |  |  | — |  |  | (701) |  |  | (40) |  |  | (16) |  |  | — |  |  | (518) |
Release of reserve for losses | 994 |  |  | — |  |  | 283 |  |  | — |  |  | — |  |  | — |  |  | 1,277 |
Other non-interest expense | (18,679) |  |  | (7,080) |  |  | (5,784) |  |  | (7,420) |  |  | (13,903) |  |  | — |  |  | (52,866) |
Non-interest expense(4) | (17,685) |  |  | (7,080) |  |  | (5,501) |  |  | (7,420) |  |  | (13,903) |  |  | — |  |  | (51,589) |
Core earnings before income taxes | 64,874 |  |  | 14,079 |  |  | 14,510 |  |  | 40,718 |  |  | (5,618) |  |  | (7,408) |  | (5) | 121,155 |
Income tax (expense)/benefit | (13,623) |  |  | (2,957) |  |  | (3,047) |  |  | (8,551) |  |  | 1,043 |  |  | 1,556 |  |  | (25,579) |
Core earnings before preferred stock dividends | 51,251 |  |  | 11,122 |  |  | 11,463 |  |  | 32,167 |  |  | (4,575) |  |  | (5,852) |  | (5) | 95,576 |
Preferred stock dividends | — |  |  | — |  |  | — |  |  | — |  |  | (17,885) |  |  | — |  |  | (17,885) |
Segment core earnings/(losses) | $ | 51,251 |  |  | $ | 11,122 |  |  | $ | 11,463 |  |  | $ | 32,167 |  |  | $ | (22,460) |  |  | $ | (5,852) |  | (5) | $ | 77,691 |
Total assets at carrying value | $ | 6,883,879 |  |  | $ | 2,522,382 |  |  | $ | 2,249,071 |  |  | $ | 8,395,286 |  |  | $ | 4,693,750 |  |  | $ | — |  |  | $ | 24,744,368 |
Total on- and off-balance sheet program assets at principal balance | $ | 9,445,359 |  |  | $ | 2,722,702 |  |  | $ | 2,817,427 |  |  | $ | 8,133,303 |  |  | $ | — |  |  | $ | — |  |  | $ | 23,118,791 |
(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 "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 Nine Months Ended September 30, 2020
| Farm & Ranch |  | USDA Guarantees |  | Rural Utilities |  | Institutional Credit |  | Corporate |  | Reconciling Adjustments |  | Consolidated Net Income
| (in thousands)
Net interest income | $ | 53,768 |  |  | $ | 14,691 |  |  | $ | 12,778 |  |  | $ | 48,059 |  |  | $ | 5,025 |  |  | $ | — |  |  | $ | 134,321 |
Less: reconciling adjustments(1)(2)(3) | (4,072) |  |  | 488 |  |  | 4,597 |  |  | 7,026 |  |  | 74 |  |  | (8,113) |  |  | — |
Net effective spread | 49,696 |  |  | 15,179 |  |  | 17,375 |  |  | 55,085 |  |  | 5,099 |  |  | (8,113) |  |  | — |
Guarantee and commitment fees(2) | 12,822 |  |  | 658 |  |  | 995 |  |  | 23 |  |  | — |  |  | (5,003) |  |  | 9,495 |
Other income/(expense)(3) | 2,197 |  |  | 864 |  |  | 12 |  |  | — |  |  | (413) |  |  | (3,048) |  |  | (388) |
Non-interest income/(loss) | 15,019 |  |  | 1,522 |  |  | 1,007 |  |  | 23 |  |  | (413) |  |  | (8,051) |  |  | 9,107 |
Release of/(provision for) losses | 412 |  |  | — |  |  | (4,704) |  |  | (222) |  |  | (28) |  |  | — |  |  | (4,542) |
Provision for reserve for losses | (262) |  |  | — |  |  | (278) |  |  | — |  |  | — |  |  | — |  |  | (540) |
Other non-interest expense | (16,632) |  |  | (5,045) |  |  | (4,428) |  |  | (6,606) |  |  | (12,171) |  |  | — |  |  | (44,882) |
Non-interest expense(4) | (16,894) |  |  | (5,045) |  |  | (4,706) |  |  | (6,606) |  |  | (12,171) |  |  | — |  |  | (45,422) |
Core earnings before income taxes | 48,233 |  |  | 11,656 |  |  | 8,972 |  |  | 48,280 |  |  | (7,513) |  |  | (16,164) |  | (5) | 93,464 |
Income tax (expense)/benefit | (10,129) |  |  | (2,448) |  |  | (1,884) |  |  | (10,139) |  |  | 1,689 |  |  | 3,395 |  |  | (19,516) |
Core earnings before preferred stock dividends | 38,104 |  |  | 9,208 |  |  | 7,088 |  |  | 38,141 |  |  | (5,824) |  |  | (12,769) |  | (5) | 73,948 |
Preferred stock dividends | — |  |  | — |  |  | — |  |  | — |  |  | (12,536) |  |  | — |  |  | (12,536) |
Loss on retirement of preferred stock | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (1,667) |  |  | (1,667) |
Segment core earnings/(losses) | $ | 38,104 |  |  | $ | 9,208 |  |  | $ | 7,088 |  |  | $ | 38,141 |  |  | $ | (18,360) |  |  | $ | (14,436) |  | (5) | $ | 59,745 |
Total assets at carrying value | $ | 5,961,307 |  |  | $ | 2,487,687 |  |  | $ | 2,256,011 |  |  | $ | 8,716,923 |  |  | $ | 4,576,909 |  |  | $ | — |  |  | $ | 23,998,837 |
Total on- and off-balance sheet program assets at principal balance | $ | 8,249,349 |  |  | $ | 2,735,128 |  |  | $ | 2,685,309 |  |  | $ | 8,319,502 |  |  | $ | — |  |  | $ | — |  |  | $ | 21,989,288 |
(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 "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.

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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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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