Federal Agricultural Mortgage Corp
NYSE:AGM
Federal Agricultural Mortgage Corp
Federal Agricultural Mortgage Corporation, known as Farmer Mac, was born from Congress's innovative vision in 1988, aimed at bolstering the rural and agricultural economy. As a key player in the U.S. secondary market for agricultural loans, Farmer Mac stands tall with a mission to provide liquidity and increase lending opportunities for underserved agricultural communities. The company doesn’t directly lend to farmers; instead, it purchases loans from lenders such as banks and Farm Credit System institutions. By doing so, it injects the much-needed cash back into the lenders' coffers, encouraging them to extend more credit to the agricultural sector. This model ensures that farmers have access to more diverse and competitive financing options, creating a robust agricultural economy that fuels both community growth and the broader U.S. economy.
The core of Farmer Mac’s business hinges on its ability to package these purchased loans into mortgage-backed securities, which are then sold to investors. This not only allows Farmer Mac to mitigate the risk associated with agricultural lending but also generates revenue through fees and interest rate spreads. Essentially, Farmer Mac earns money by bridging the gap between agricultural loan originators and the capital markets, providing a steady flow of credit across the agricultural landscape. Its role is akin to that of a vital artery, ensuring constant and reliable financial circulation within the agriculture sector. Through this sophisticated intermediation, Farmer Mac supports the stability and growth of rural America, underpinning the livelihoods of countless farmers and agribusinesses.
Federal Agricultural Mortgage Corporation, known as Farmer Mac, was born from Congress's innovative vision in 1988, aimed at bolstering the rural and agricultural economy. As a key player in the U.S. secondary market for agricultural loans, Farmer Mac stands tall with a mission to provide liquidity and increase lending opportunities for underserved agricultural communities. The company doesn’t directly lend to farmers; instead, it purchases loans from lenders such as banks and Farm Credit System institutions. By doing so, it injects the much-needed cash back into the lenders' coffers, encouraging them to extend more credit to the agricultural sector. This model ensures that farmers have access to more diverse and competitive financing options, creating a robust agricultural economy that fuels both community growth and the broader U.S. economy.
The core of Farmer Mac’s business hinges on its ability to package these purchased loans into mortgage-backed securities, which are then sold to investors. This not only allows Farmer Mac to mitigate the risk associated with agricultural lending but also generates revenue through fees and interest rate spreads. Essentially, Farmer Mac earns money by bridging the gap between agricultural loan originators and the capital markets, providing a steady flow of credit across the agricultural landscape. Its role is akin to that of a vital artery, ensuring constant and reliable financial circulation within the agriculture sector. Through this sophisticated intermediation, Farmer Mac supports the stability and growth of rural America, underpinning the livelihoods of countless farmers and agribusinesses.
Record Revenue: Farmer Mac reported record revenue of $410 million for 2025, a 13% increase over the prior year.
Business Volume Growth: Outstanding business volume surpassed $33 billion, with $3.8 billion in net new business volume across all segments.
Dividend Increase: The quarterly dividend was raised by $0.10 to $1.60 per share, marking the 15th consecutive annual increase.
Credit Costs: Core earnings for Q4 declined due to credit provisions from a small number of specific loans, but management emphasized these were not systemic.
Expense Management: Operating expenses rose 14% year-over-year to support growth, but management remains committed to their 30% efficiency ratio target.
Shareholder Returns: $78 million was returned to shareholders through dividends and share repurchases in 2025.
Positive Outlook: Management expects continued strong growth, especially in Farm & Ranch AgVantage, infrastructure, and data center financing.
