What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-05-09 compared with 2022-11-07 · 320 added, 592 removed, 1181 unchanged (44% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

(in thousands)

53 unchanged sentences

Additional paid-in capital 130,004 128,939

Accumulated other comprehensive (loss)/income, net of tax ( 63,589 ) 3,853

Accumulated other comprehensive loss, net of tax ( 59,862 ) ( 50,843 )

Retained earnings 726,892 698,530

4 unchanged sentences

CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three Months Ended For the Nine Months Ended

September 30, 2022 September 30, 2021 September 30, 2022 September 30, 2021

For the Three Months Ended

March 31, 2023 March 31, 2022

(in thousands, except per share amounts)

6 unchanged sentences

Net interest income 79,058 65,538

(Provision for)/release of losses ( 617 ) ( 366 ) 699 ( 518 )

Net interest income after (provision for)/release of losses 67,236 58,550 198,004 167,597

Provision for losses ( 547 ) ( 56 )

Net interest income after provision for losses 78,511 65,482

Non-interest income/(expense):

Guarantee and commitment fees 3,933 3,695

Gains/(losses) on financial derivatives 772 ( 888 ) 21,551 2,581

(Losses)/gains on trading securities ( 41 ) 37 ( 75 ) ( 38 )

Gains on sale of available-for-sale investment securities — 253 — 253

Release of reserve for losses 167 111 440 1,277

Gains on financial derivatives 399 16,988

Gains/(losses) on trading securities 25 ( 63 )

(Provision for)/release of reserve for losses ( 203 ) 110

Other income 1,201 675

16 unchanged sentences

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Three Months Ended For the Nine Months Ended

September 30, 2022 September 30, 2021 September 30, 2022 September 30, 2021

For the Three Months Ended

March 31, 2023 March 31, 2022

(in thousands

1 unchanged sentence

Other comprehensive (loss)/income:

Net unrealized (losses)/gains on available-for-sale securities ( 41,827 ) 991 ( 158,273 ) 29,966

Net unrealized gains/(losses) on available-for-sale securities 658 ( 86,267 )

Net changes in held-to-maturity securities ( 782 ) ( 23 )

Net unrealized gains on cash flow hedges 24,596 3,258 72,684 16,899

Other comprehensive (loss)/income before tax ( 17,853 ) 1,864 ( 85,369 ) 40,670

Income tax benefit/(expense) related to other comprehensive (loss)/income 3,748 ( 391 ) 17,927 ( 8,541 )

Other comprehensive (loss)/income net of tax ( 14,105 ) 1,473 ( 67,442 ) 32,129

Comprehensive income/(loss) $ 27,313 $ 36,778 $ 67,284 $ 134,365

Net unrealized (losses)/gains on cash flow hedges ( 11,292 ) 31,204

Other comprehensive loss before tax ( 11,416 ) ( 55,086 )

Income tax benefit related to other comprehensive loss 2,397 11,568

Other comprehensive loss net of tax ( 9,019 ) ( 43,518 )

Comprehensive income $ 38,016 $ 7,935

The accompanying notes are an integral part of these consolidated financial statements.

16 unchanged sentences

Balance as of March 31, 2023 19,980 $ 484,531 10,820 $ 10,820 $ 130,004 $ ( 59,862 ) $ 726,892 $ 1,292,385

Net Income — — — — — — 41,855 41,855

Other comprehensive loss, net of tax — — — — — ( 9,819 ) — ( 9,819 )

Cash dividends:

Preferred stock — — — — — — ( 6,792 ) ( 6,792 )

Common stock (cash dividend of $ 0.95 per share)

— — — — — — ( 10,256 ) ( 10,256 )

Issuance of Class C Common Stock — — 9 9 46 — — 55

Stock-based compensation cost — — — — 862 — — 862

Other stock-based award activity — — — — ( 442 ) — — ( 442 )

Balance as of June 30, 2022 19,980 $ 484,531 10,797 $ 10,797 $ 127,569 $ ( 49,484 ) $ 647,797 $ 1,221,210

Net Income — — — — — — 41,418 41,418

Other comprehensive loss, net of tax — — — — — ( 14,105 ) — ( 14,105 )

Cash dividends:

Preferred stock — — — — — — ( 6,791 ) ( 6,791 )

Common stock (cash dividend of $ 0.95 per share)

— — — — — — ( 10,260 ) ( 10,260 )

Issuance of Class C Common Stock — — 3 3 48 — — 51

Stock-based compensation cost — — — — 832 — — 832

Other stock-based award activity — — — — ( 332 ) — — ( 332 )

Balance as of September 30, 2022 19,980 $ 484,531 10,800 $ 10,800 $ 128,117 $ ( 63,589 ) $ 672,164 $ 1,232,023

Additional Other

Preferred Stock Common Stock Paid-In Comprehensive Retained Total

Shares Amount Shares Amount Capital Income/(Loss) Earnings Equity

(in thousands)

Balance as of December 31, 2021 19,980 $ 484,531 10,766 $ 10,766 $ 125,993 $ 3,853 $ 588,557 $ 1,213,700

Net Income — — — — — — 51,453 51,453

Other comprehensive income, net of tax — — — — — 65,667 — 65,667

Cash dividends:

Preferred stock — — — — — — ( 5,269 ) ( 5,269 )

Common stock (cash dividend of $ 0.88 per share)

— — — — — — ( 9,450 ) ( 9,450 )

Issuance of Class C Common Stock — — 21 21 12 — — 33

Stock-based compensation cost — — — — 1,665 — — 1,665

Other stock-based award activity — — — — ( 858 ) — — ( 858 )

Balance as of March 31, 2021 14,980 $ 363,204 10,758 $ 10,758 $ 123,718 $ 51,744 $ 538,367 $ 1,087,791

Net Income — — — — — — 28,863 28,863

Other comprehensive loss, net of tax — — — — — ( 43,518 ) — ( 43,518 )

3 unchanged sentences

— — — — — — ( 10,229 ) ( 10,229 )

Issuance of Series G Preferred Stock 5,000 121,327 — — — — — 121,327

Issuance of Class C Common Stock — — 22 22 46 — — 68

1 unchanged sentence

Other stock-based award activity — — — — ( 1,049 ) — — ( 1,049 )

Balance as of June 30, 2021 19,980 $ 484,531 10,765 $ 10,765 $ 124,148 $ 16,733 $ 551,914 $ 1,188,091

Net Income — — — — — — 35,305 35,305

Other comprehensive income, net of tax — — — — — 1,473 — 1,473

Cash dividends:

Preferred stock — — — — — — ( 6,774 ) ( 6,774 )

Common stock (cash dividend of $ 0.88 per share)

— — — — — — ( 9,474 ) ( 9,474 )

Issuance of Class C Common Stock — — 1 1 45 — — 46

Stock-based compensation cost — — — — 749 — — 749

Balance as of September 30, 2021 19,980 $ 484,531 10,766 $ 10,766 $ 124,942 $ 18,206 $ 570,971 $ 1,209,416

Balance as of March 31, 2022 19,980 $ 484,531 10,788 $ 10,788 $ 127,103 $ ( 39,665 ) $ 622,990 $ 1,205,747

The accompanying notes are an integral part of these consolidated financial statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Nine Months Ended

September 30, 2022 September 30, 2021

For the Three Months Ended

March 31, 2023 March 31, 2022

(in thousands)

5 unchanged sentences

Net change in fair value of trading securities, hedged assets, and financial derivatives ( 62,398 ) 235,964

Gain on the sale of available-for-sale investment securities — ( 253 )

Total release of allowance for losses ( 1,139 ) ( 759 )

Total provision for/(release of) allowance for losses 750 ( 54 )

Excess tax benefits related to stock-based awards ( 201 ) ( 137 )

9 unchanged sentences

Other liabilities ( 8,227 ) 6,191

Net cash provided by operating activities 706,258 433,219

Net cash provided by/(used in) operating activities 60,561 269,305

Cash flows from investing activities:

3 unchanged sentences

Purchases of loans held for investment ( 554,787 ) ( 718,008 )

Purchases of defaulted loans — ( 8,713 )

Proceeds from repayment of available-for-sale investment securities 505,848 418,414

1 unchanged sentence

Proceeds from repayment of loans purchased as held for investment 431,483 463,602

Proceeds from sale of loans previously classified as held for investment 9,000 10,000

Proceeds from sale of available-for-sale investment securities — 257,524

Proceeds from sale of Farmer Mac Guaranteed Securities — 25,928

8 unchanged sentences

Proceeds from common stock issuance 51 46

Proceeds from preferred stock issuance, net of stock issuance costs — 121,327

Tax payments related to share-based awards 18 ( 119 )

5 unchanged sentences

Non-cash activity:

Loans acquired and securitized as Farmer Mac Guaranteed Securities 47,212 84,131

Consolidation of Farmer Mac Guaranteed Securities from off-balance sheet to loans held for investment in consolidated trusts and to debt securities of consolidated trusts held by third parties 47,212 84,131

Loans securitized as Farmer Mac Guaranteed Securities 4,174 25,928

Loans held for investment transferred to consolidated trusts 281,027 —

Reclassification of defaulted loans from loans held for investment in consolidated trusts to loans held for investment 1,781 24,690

Reclassification of loans held for investment to loans held for sale — 9,000

Capitalized interest 446 1,253

Charge-off from the allowance for losses 84 —

Matured securities receivable ( 97,500 ) ( 1,566 )

(Recovery)/charge-off from the allowance for losses — 84

Loan payoff not yet received ( 4,537 ) —

Purchases of securities - traded, not yet settled 49,414 348,020

14 unchanged sentences

from Farmer Mac's audited 2022 consolidated financial statements, as revised.

Management believes that the disclosures are adequate to present fairly the consolidated financial statements as of the dates and for the periods presented.

Management believes that

the disclosures are adequate to present fairly the consolidated financial statements as of the dates and for

the periods presented.

These interim unaudited consolidated financial statements should be read in

2 unchanged sentences

on February 24, 2023.

Results for interim periods are not necessarily indicative of those that may be expected for the fiscal year.

Results for interim periods are not necessarily indicative of those that may be

expected for the fiscal year.

Presented below are Farmer Mac's significant accounting policies that contain

updated information for the three and nine months ended September 30, 2022.

updated information for the three months ended March 31, 2023.

Farmer Mac has revised its prior period financial information to correct an error that was not material to those previous consolidated financial statements, taken as a whole.

6 unchanged sentences

Consolidation of Variable Interest Entities

As of September 30, 2022

As of March 31, 2023

Agricultural Finance Treasury Total

21 unchanged sentences

(1) Includes borrower remittances of $ 0.6 million.

The borrower remittances had not been passed through to third-party investors as of September 30, 2022.

(2) Includes $ 39.1 million in unamortized discount related to a structured securitization transaction.

The borrower remittances had not been passed through to third-party investors as of March 31, 2023.

(2) Includes $ 94.6 million in unamortized discount related to structured securitization transactions.

(3) Farmer Mac uses unpaid principal balance and outstanding face amount of investment securities to represent maximum exposure to loss.

27 unchanged sentences

The borrower remittances had not been passed through to third-party investors as of December 31, 2022.

(2) Includes $ 37.7 million in unamortized discount related to a structured securitization transaction.

(3) Farmer Mac uses unpaid principal balance and outstanding face amount of investment securities to represent maximum exposure to loss.

4 unchanged sentences

Diluted earnings per common share is based on the daily weighted-average number of shares of common stock outstanding adjusted to include all potentially dilutive stock appreciation rights ("SARs") and unvested restricted stock awards.

The following schedule reconciles basic and diluted EPS for the three and nine months ended September 30, 2022 and 2021:

The following schedule reconciles basic and diluted EPS for the three months ended March 31, 2023 and 2022:

For the Three Months Ended

September 30, 2022 September 30, 2021

Income Weighted-Average Shares $ per

(in thousands, except per share amounts)

Net income attributable to common stockholders $ 34,627 10,799 $ 3.21 $ 28,531 10,766 $ 2.65

Effect of dilutive securities (1)

SARs and restricted stock — 75 ( 0.03 ) — 76 ( 0.02 )

Diluted EPS $ 34,627 10,874 $ 3.18 $ 28,531 10,842 $ 2.63

(1) For the three months ended September 30, 2022 and 2021, SARs and restricted stock of 18,432 and 28,575 , respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive.

For the three months ended September 30, 2022 and 2021 contingent shares of unvested restricted stock of 18,535 and 18,183 respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.

For the Nine Months Ended

September 30, 2022 September 30, 2021

March 31, 2023 March 31, 2022

Income Weighted-Average Shares $ per

5 unchanged sentences

Diluted EPS $ 40,244 10,918 $ 3.69 $ 44,662 10,887 $ 4.10

(1) For the nine months ended September 30, 2022 and 2021, SARs and restricted stock of 37,120 and 52,434 , respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive.

For the nine months ended September 30, 2022 and 2021 contingent shares of unvested restricted stock of 18,535 and 18,183 respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.

(1) For the three months ended March 31, 2023 and 2022, SARs and restricted stock of 62,709 and 50,005 respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive.

For the three months ended March 31, 2023 and 2022, contingent shares of unvested restricted stock of 32,282 and 18,535 respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because performance conditions had not yet been met.

(b) Comprehensive Income

Comprehensive income represents all changes in stockholders' equity except those resulting from investments by or distributions to stockholders, and is comprised of net income and unrealized gains and losses on available-for-sale securities, certain held-to-maturity securities transferred from the available-for-sale classification, and cash flow hedges, net of related taxes.

The following table presents the changes in accumulated other comprehensive income ("AOCI"), net of tax, by component for the three and nine months ended September 30, 2022 and 2021.

As of September 30, 2022 As of September 30, 2021

The following table presents the changes in accumulated other comprehensive income ("AOCI"), net of tax, by component for the three months ended March 31, 2023 and 2022.

As of March 31, 2023 As of March 31, 2022

Available-for-Sale Securities Held-to-Maturity Securities Cash Flow Hedges Total Available-for-Sale Securities Held-to-Maturity Securities Cash Flow Hedges Total

6 unchanged sentences

Ending Balance $ ( 115,041 ) $ 15,739 $ 39,440 $ ( 59,862 ) $ ( 75,083 ) $ 16,134 $ 19,284 $ ( 39,665 )

For the Nine Months Ended:

Beginning Balance $ ( 6,932 ) $ 16,153 $ ( 5,368 ) $ 3,853 $ ( 13,937 ) $ 22,829 $ ( 22,815 ) $ ( 13,923 )

Other comprehensive (loss)/income before reclassifications ( 125,027 ) — 55,766 ( 69,261 ) 25,734 — 9,041 34,775

Amounts reclassified from AOCI ( 8 ) 173 1,654 1,819 ( 2,061 ) ( 4,894 ) 4,309 ( 2,646 )

Net comprehensive (loss)/income ( 125,035 ) 173 57,420 ( 67,442 ) 23,673 ( 4,894 ) 13,350 32,129

Ending Balance $ ( 131,967 ) $ 16,326 $ 52,052 $ ( 63,589 ) $ 9,736 $ 17,935 $ ( 9,465 ) $ 18,206

The following table presents other comprehensive income activity, the impact on net income of amounts reclassified from each component of AOCI, and the related tax impact for the three and nine months ended September 30, 2022 and 2021:

For the Three Months Ended

September 30, 2022 September 30, 2021

Before Tax Provision (Benefit) After Tax Before Tax Provision (Benefit) After Tax

(in thousands)

Other comprehensive income:

Available-for-sale-securities:

Unrealized holding (losses)/gains on available-for-sale securities $ ( 41,824 ) $ ( 8,783 ) $ ( 33,041 ) $ 1,614 $ 339 $ 1,275

Less reclassification adjustments included in:

Net interest income (1)

— — — ( 362 ) ( 76 ) ( 286 )

Gains on sale of available-for-sale investment securities (2)

— — — ( 253 ) ( 53 ) ( 200 )

Other income (3)

( 3 ) ( 1 ) ( 2 ) ( 8 ) ( 1 ) ( 7 )

Total $ ( 41,827 ) $ ( 8,784 ) $ ( 33,043 ) $ 991 $ 209 $ 782

Held-to-maturity securities:

Less reclassification adjustments included in:

Net interest income (4)

( 622 ) ( 130 ) ( 492 ) ( 2,385 ) ( 501 ) ( 1,884 )

Total $ ( 622 ) $ ( 130 ) $ ( 492 ) $ ( 2,385 ) $ ( 501 ) $ ( 1,884 )

Cash flow hedges

Unrealized gains on cash flow hedges $ 25,668 $ 5,391 $ 20,277 $ 1,326 $ 277 $ 1,049

Less reclassification adjustments included in:

Net interest income (5)

( 1,072 ) ( 225 ) ( 847 ) 1,932 406 1,526

Total $ 24,596 $ 5,166 $ 19,430 $ 3,258 $ 683 $ 2,575

Other comprehensive (loss)/income $ ( 17,853 ) $ ( 3,748 ) $ ( 14,105 ) $ 1,864 $ 391 $ 1,473

(1) Relates to the amortization of unrealized gains on hedged items prior to the application of fair value hedge accounting.

(2) Represents unrealized gains and losses on sales of available-for-sale securities.

(3) Represents amortization of deferred gains related to certain available-for-sale USDA Securities and Farmer Mac Guaranteed USDA Securities.

(4) Relates to the amortization of unrealized gains or losses prior to the reclassification of these securities from available-for-sale to held-to-maturity.

The amortization of unrealized gains or losses reported in AOCI for held-to-maturity securities will be offset by the amortization of the premium or discount created from the transfer into held-to-maturity securities, which occurred at fair value.

These unrealized gains or losses will be recorded over the remaining life of the security with no impact on future net income.

(5) Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI.

For the Nine Months Ended

September 30, 2022 September 30, 2021

March 31, 2023 March 31, 2022

Before Tax Provision (Benefit) After Tax Before Tax Provision (Benefit) After Tax

2 unchanged sentences

Available-for-sale-securities:

Unrealized holding (losses)/gains on available-for-sale securities $ ( 158,263 ) $ ( 33,236 ) $ ( 125,027 ) $ 32,574 $ 6,840 $ 25,734

Unrealized holding gains/(losses) on available-for-sale securities $ 664 $ 139 $ 525 $ ( 86,263 ) $ ( 18,115 ) $ ( 68,148 )

Less reclassification adjustments included in:

Net interest income (1)

— — — ( 2,333 ) ( 490 ) ( 1,843 )

Gains on sale of available-for-sale investment securities (2)

— — — ( 253 ) ( 53 ) ( 200 )

Other income (2)

7 unchanged sentences

Cash flow hedges

Unrealized gains on cash flow hedges $ 70,590 $ 14,824 $ 55,766 $ 11,445 $ 2,404 $ 9,041

Unrealized (losses)/gains on cash flow hedges $ ( 6,901 ) $ ( 1,449 ) $ ( 5,452 ) $ 29,193 $ 6,131 $ 23,062

Less reclassification adjustments included in:

2 unchanged sentences

Total $ ( 11,292 ) $ ( 2,371 ) $ ( 8,921 ) $ 31,204 $ 6,552 $ 24,652

Other comprehensive (loss)/income $ ( 85,369 ) $ ( 17,927 ) $ ( 67,442 ) $ 40,670 $ 8,541 $ 32,129

Other comprehensive loss $ ( 11,416 ) $ ( 2,397 ) $ ( 9,019 ) $ ( 55,086 ) $ ( 11,568 ) $ ( 43,518 )

(1) Relates to the amortization of unrealized gains on hedged items prior to the application of fair value hedge accounting.

(2) Represents unrealized gains and losses on sales of available-for-sale securities.

(2) Represents amortization of deferred gains related to certain available-for-sale USDA Securities and Farmer Mac Guaranteed USDA Securities.

11 unchanged sentences

January 1, 2020 Farmer Mac adopted optional expedients specific to discounting transition on a retrospective basis, and as a result of this election, the discounting transition did not have a material effect on Farmer Mac's financial position, results of operations, or cash flows.

Farmer Mac is exploring the adoption of additional optional expedients, including contract modification relief, and is not expected to have a material effect on Farmer Mac's financial position, results of operations, or cash flows.

Recently Issued Accounting Guidance

Standard Description Effect on Consolidated Financial Statements

Farmer Mac expects to adopt additional optional expedients, including contract modification relief, and does not expect this to have a material effect on Farmer Mac's financial position, results of operations, or cash flows.

ASU 2022-06 , Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848

The amendments in this Update deferred the sunset date in Topic 848 from December 31, 2022 to December 31, 2024.

December 21, 2022 Farmer Mac continues to evaluate the impact of ASC 848.

ASU 2022-02 , Financial Instruments-Credit Losses (Topic 326):

Troubled Debt Restructurings and Vintage Disclosures

The Update addresses and amends areas identified by the Financial Accounting Standards Board ("FASB") as part of its post-implementation review of the accounting standard that introduced the current expected credit losses (“CECL”) model.

The Update addresses and amends areas identified by the Financial Accounting Standards Board as part of its post-implementation review of the accounting standard that introduced the current expected credit losses (“CECL”) model.

The amendments eliminate the accounting guidance for troubled debt restructurings by creditors that have adopted the CECL model and enhance the disclosure requirements for loan refinancings and restructurings made with borrowers experiencing financial difficulty.

In addition, the amendments require disclosure of current-period gross writeoffs for financing receivables and net investment in leases by year of origination in the vintage disclosures.

ASU 2022-02 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years for entities that have adopted the CECL accounting standard.

Early adoption, however, is permitted if an entity has adopted the CECL accounting standard.

Farmer Mac is still assessing the impact of the new accounting standard but does not expect that adoption of the new guidance will have a material effect on Farmer Mac's financial position, results of operations, or cash flows.

January 1, 2023 The adoption of this Update did not have a material effect on Farmer Mac's financial position, results of operations, or cash flows.

Recently Issued Accounting Guidance

Standard Description Effect on Consolidated Financial Statements

ASU 2022-01 , Fair Value Hedging - Portfolio Layer Method

The Update introduces the portfolio layer method, which expands the current single-layer method to allow multiple hedged layers of a single closed portfolio under the method (previously named, last-of-layer method).

Additionally, it expands the scope of the portfolio layer method to include non-prepayable assets, specifies eligible hedging instruments in a single-layer hedge, provides additional guidance on the accounting for and disclosure of hedge basis adjustments under the portfolio layer method, specifies how hedge basis adjustments should be considered when determining credit losses for the assets included in the closed portfolio, and provides that an entity may reclassify HTM debt securities identified within 30 days of the date of adoption to AFS if the entity applies portfolio layer method hedging to those debt securities.

Farmer Mac is continuing to evaluate the use of the portfolio layer method in its hedging programs, although future use of the standard is dependent on its asset-liability management strategies in the context of the then current interest rate outlook.

Farmer Mac does not believe adoption of the standard will have a material effect on Farmer Mac's financial position, results of operations, or cash flows.

(d) Reclassifications

Certain reclassifications of prior period information were made to conform to the current period presentation.

The reclassifications of prior period information were not material to the consolidated financial statements.

INVESTMENT SECURITIES

The following tables set forth information about Farmer Mac's available-for-sale and held-to-maturity investment securities as of September 30, 2022 and December 31, 2021:

As of September 30, 2022

The following tables set forth information about Farmer Mac's available-for-sale and held-to-maturity investment securities as of March 31, 2023 and December 31, 2022:

As of March 31, 2023

Amount Outstanding Unamortized Premium/(Discount) Amortized

14 unchanged sentences

Total held-to-maturity $ 45,032 $ — $ 45,032 $ — $ 611 $ — $ 45,643

(1) Amounts presented exclude $ 6.3 million of accrued interest receivable on investment securities as of September 30, 2022.

(1) Amounts presented exclude $ 12.4 million of accrued interest receivable on investment securities as of March 31, 2023.

(2) Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the consolidated statement of operations as a provision for losses.

Amount excludes unrealized losses relating to non-credit factors.

(3) The held-to-maturity investment securities had a weighted average yield of 3.0 % as of September 30, 2022.

(3) The held-to-maturity investment securities had a weighted average yield of 5.8 % as of March 31, 2023.

As of December 31, 2022

19 unchanged sentences

(3) The held-to-maturity investment securities had a weighted average yield of 4.5 % as of December 31, 2022.

Farmer Mac did no t sell any securities from its available-for-sale investment portfolio during the three and nine months ended September 30, 2022.

During the three and nine months ended September 30, 2021, Farmer Mac received proceeds of $ 232.0 million and $ 257.5 million, respectively, from the sale of securities from its available-for-sale investment portfolio, resulting in gains of $ 0.3 million and $ 0.3 million, respectively.

As of September 30, 2022 and December 31, 2021, unrealized losses on available-for-sale investment securities were as follows:

As of September 30, 2022

Farmer Mac did no t sell any securities from its available-for-sale investment portfolio during the three months March 31, 2023 and 2022.

As of March 31, 2023 and December 31, 2022, unrealized losses on available-for-sale investment securities were as follows:

As of March 31, 2023

Available-for-Sale Securities

27 unchanged sentences

Number of securities in loss position 174 51

The unrealized losses presented above are principally due to a general widening of market spreads and changes in the levels of interest rates from the dates of acquisition to September 30, 2022 and December 31, 2021, as applicable.

The unrealized losses presented above are principally due to a general widening of market spreads and changes in the levels of interest rates from the dates of acquisition to March 31, 2023 and December 31, 2022, as applicable.

The resulting decrease in fair values reflects an increase in the perceived risk by the financial markets related to those securities.

As of both September 30, 2022 and December 31, 2021, all of the investment securities in an unrealized loss position either were backed by the full faith and credit of the U.S.

As of both March 31, 2023 and December 31, 2022, all of the investment securities in an unrealized loss position either were backed by the full faith and credit of the U.S.

government or had credit ratings of at least "AA+."

Securities in unrealized loss positions for 12 months or longer have a fair value as of September 30, 2022 that is, on average, approximately 94.0 % of their amortized cost basis.

Securities in unrealized loss positions for 12 months or longer have a fair value as of March 31, 2023 that is, on average, approximately 93.7 % of their amortized cost basis.

Farmer Mac believes that all of these unrealized losses are recoverable within a reasonable period of time by way of maturity or changes in credit spreads.

The amortized cost, fair value, and weighted-average yield of available-for-sale investment securities by remaining contractual maturity as of September 30, 2022 are set forth below.

The amortized cost, fair value, and weighted-average yield of available-for-sale investment securities by remaining contractual maturity as of March 31, 2023 are set forth below.

Asset-backed and mortgage-backed securities are included based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets.

As of September 30, 2022

As of March 31, 2023

Available-for-Sale Securities

7 unchanged sentences

FARMER MAC GUARANTEED SECURITIES AND USDA SECURITIES

The following tables set forth information about on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities as of September 30, 2022 and December 31, 2021:

As of September 30, 2022

The following tables set forth information about on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities as of March 31, 2023 and December 31, 2022:

As of March 31, 2023

Unpaid Principal Balance Unamortized Premium/(Discount) Amortized

16 unchanged sentences

$ 1,391 $ 72 $ 1,463 $ — $ — $ ( 58 ) $ 1,405

(1) Amounts presented exclude $ 44.0 million, $ 41.1 million, and $ 38,000 of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of September 30, 2022.

(1) Amounts presented exclude $ 63.6 million, $ 36.9 million, and $ 27,000 of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of March 31, 2023.

(2) Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the statement of financial operations as a provision for losses.

1 unchanged sentence

(3) Fair value includes $ 8.0 million of an interest-only security with a notional amount of $ 244.6 million.

(4) The trading USDA securities had a weighted average yield of 4.84 % as of September 30, 2022.

(4) The trading USDA securities had a weighted average yield of 5.52 % as of March 31, 2023.

As of December 31, 2022

17 unchanged sentences

$ 1,770 $ 80 $ 1,850 $ — $ — $ ( 83 ) $ 1,767

(1) Amounts presented exclude $ 29.8 million, $ 42.1 million, and $ 0.1 million of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of December 31, 2021.

(1) Amounts presented exclude $ 51.5 million, $ 44.4 million, and $ 47,000 of accrued interest receivable on available-for-sale, held-to-maturity, and trading securities, respectively, as of December 31, 2022.

(2) Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in the statement of financial operations as a provision for losses.

2 unchanged sentences

(4) The trading USDA securities had a weighted average yield of 4.84 % as of December 31, 2022.

As of September 30, 2022 and December 31, 2021, unrealized losses on held-to-maturity and available-for-sale on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities were as follows:

As of September 30, 2022

As of March 31, 2023 and December 31, 2022, unrealized losses on held-to-maturity and available-for-sale on-balance sheet Farmer Mac Guaranteed Securities and USDA Securities were as follows:

As of March 31, 2023

Held-to-Maturity and Available-for-Sale Securities

24 unchanged sentences

AgVantage $ 548,634 $ ( 11,455 ) $ 382,358 $ ( 42,643 )

Farmer Mac Guaranteed USDA Securities 19,790 ( 856 ) — —

USDA Securities 2,086,108 ( 312,824 ) — —

2 unchanged sentences

AgVantage $ 4,642,096 $ ( 267,886 ) $ 1,548,551 $ ( 143,123 )

The unrealized losses presented above are principally due to changes in interest rates from the date of acquisition to September 30, 2022 and December 31, 2021, as applicable.

The unrealized losses on the held-to-maturity USDA Securities as of both September 30, 2022 and December 31, 2021 reflect their increased cost basis resulting from their transfer to held-to-maturity as of October 1, 2016.

Farmer Mac Guaranteed Securities 7,847 ( 2,775 ) — —

Total available-for-sale $ 4,649,943 $ ( 270,661 ) $ 1,548,551 $ ( 143,123 )

The unrealized losses presented above are principally due to changes in interest rates from the date of acquisition to March 31, 2023 and December 31, 2022, as applicable.

The credit exposure related to Farmer Mac's USDA Securities in the Agricultural Finance line of business is covered by the full faith and credit guarantee of the United States of America.

The unrealized losses from AgVantage securities were on 97 and 13 available-for-sale securities as of September 30, 2022 and December 31, 2021, respectively.

There were 44 and 10 held-to-maturity AgVantage securities with an unrealized loss as of September 30, 2022 and December 31, 2021, respectively.

As of September 30, 2022 and December 31, 2021, 9 and 2 available-for-sale AgVantage securities, respectively, had been in a loss position for more than 12 months.

As of September 30, 2022, there were 4 held-to-maturity AgVantage securities in a loss position for more than 12 months.

As of December 31, 2021, there were no held-to-maturity AgVantage securities in a loss position for more than 12 months.

During the three and nine months ended September 30, 2022 and 2021, Farmer Mac had no sales of AgVantage Farmer Mac Guaranteed Securities, USDA Farmer Mac Guaranteed Securities or USDA Trading Securities and, therefore, Farmer Mac realized no gains or losses.

The amortized cost, fair value, and weighted-average yield of available-for-sale and held-to-maturity Farmer Mac Guaranteed Securities and USDA Securities by remaining contractual maturity as of September 30, 2022 are set forth below.

The unrealized losses from AgVantage securities were on 94 and 95 available-for-sale securities as of March 31, 2023 and December 31, 2022, respectively.

There were 33 and 37 held-to-maturity AgVantage securities with an unrealized loss as of March 31, 2023 and December 31, 2022, respectively.

As of March 31, 2023 and December 31, 2022, 28 and 13 available-for-sale AgVantage securities, respectively, had been in a loss position for more than 12 months.

As of March 31, 2023 and December 31, 2022, there were 16 and 4 held-to-maturity AgVantage securities, respectively, in a loss position for more than 12 months.

During the three months ended March 31, 2023 and 2022 Farmer Mac had no sales of AgVantage Farmer Mac Guaranteed Securities, USDA Farmer Mac Guaranteed Securities or USDA Trading Securities and, therefore, Farmer Mac realized no gains or losses.

The balances presented are based on their contractual maturities, although the actual maturities may differ due to prepayments of the underlying assets.

As of September 30, 2022

As of March 31, 2023

Available-for-Sale Securities

7 unchanged sentences

(1) Amounts presented exclude $ 63.6 million of accrued interest receivable.

As of September 30, 2022

As of March 31, 2023

Held-to-Maturity Securities

9 unchanged sentences

Farmer Mac enters into financial derivative transactions to protect against risk from the effects of market price, or interest rate movements, on the value of certain assets, future cash flows, or debt issuance, and not for trading or speculative purposes.

For more information about Farmer Mac's financial derivatives, see Note 6 in Farmer Mac's Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as filed with the SEC on February 28, 2022.

Certain financial derivatives are designated as fair value hedges of

fixed rate assets, classified as available-for-sale, to protect against fair value changes in the assets related

to changes in a benchmark interest rate (e.g., LIBOR or SOFR).

Certain other financial derivatives are

designated as cash flow hedges to mitigate the volatility of future interest rate payments on floating rate

Certain financial derivatives are not designated in hedge accounting relationships.

Farmer Mac manages the interest rate risk related to loans it has committed to acquire, but has not yet

permanently funded, primarily through the use of forward sale contracts on the debt of other GSEs and

futures contracts involving U.S.

Treasury securities.

Farmer Mac uses forward sale contracts on GSE

securities to reduce its interest rate exposure to changes in both U.S.

Treasury rates and spreads on Farmer

Farmer Mac aims to achieve a duration-matched hedge ratio between the hedged item and the

hedge instrument.

Gains or losses generated by these hedge transactions are expected to offset changes in

funding costs.

All financial derivatives are recorded on the balance sheet at fair value as a freestanding

asset or liability.

The following tables summarize information related to Farmer Mac's financial derivatives on a gross basis without giving consideration to master netting arrangements.

The table below includes accrued interest on cleared swaps, but excludes $ 4.3 million and $ 3.0 million of accrued interest receivable and $ 1.5 million and $ 1.9 million of accrued interest payable on uncleared swaps as of September 30, 2022 and December 31, 2021, respectively.

The aforementioned accrued interest on uncleared swaps is included within Accrued Interest Receivable and Accrued Interest Payable on the Consolidated Balance Sheet.

As of September 30, 2022

The table below includes accrued interest on cleared swaps, but excludes $ 8.2 million and $ 6.1 million of accrued interest receivable and $ 4.5 million and $ 3.6 million of accrued interest payable on uncleared swaps as of March 31, 2023 and December 31, 2022, respectively.

The aforementioned accrued interest on uncleared swaps is included within Accrued Interest Receivable and Accrued Interest Payable on the consolidated balance sheets.

As of March 31, 2023

Fair Value Weighted-

33 unchanged sentences

Interest rate swaps:

Pay fixed non-callable $ 6,238,438 $ 205 $ ( 9,525 ) 2.06 % 0.13 % 11.64

Receive fixed non-callable $ 10,033,750 $ 19 $ ( 4,686 ) 4.31 % 2.03 % 1.64

Pay fixed non-callable 8,149,871 13,689 ( 366 ) 2.23 % 4.33 % 10.76

Receive fixed callable 2,764,577 461 ( 174,757 ) 4.21 % 1.98 % 3.18

8 unchanged sentences

Treasury futures 6,800 — ( 142 ) 114.38

Credit valuation adjustment — 14

Netting adjustments (1)

2 unchanged sentences

(1) Amounts represent the application of the netting requirements that allow Farmer Mac to settle positive and negative positions, including accrued interest, held or placed with the same clearing agent.

As of September 30, 2022, Farmer Mac expects to reclassify $ 12.9 million after-tax from accumulated other comprehensive income to earnings over the next twelve months related to cash flow hedges.

This amount could differ from amounts actually recognized due to changes in interest rates, hedge de-designations, and the addition of other hedges after September 30, 2022.

During the three and nine months ended September 30, 2022 and 2021, there were no gains or losses from interest rate swaps designated as cash flow hedges reclassified to earnings because it was probable that the originally forecasted transactions would occur.

The following tables summarize the net income/(expense) recognized in the consolidated statements of operations related to derivatives for the three and nine months ended September 30, 2022 and 2021:

For the Three Months Ended September 30, 2022

As of March 31, 2023, Farmer Mac expects to reclassify $ 13.7 million after-tax from accumulated other comprehensive income to earnings over the next twelve months related to cash flow hedges.

This amount could differ from amounts actually recognized due to changes in interest rates, hedge de-designations, and the addition of other hedges after March 31, 2023.

During the three months ended March 31, 2023 and 2022, there were no gains or losses from interest rate swaps designated as cash flow hedges reclassified to earnings because it was probable that the originally forecasted transactions would occur.

The following tables summarize the net income/(expense) recognized in the consolidated statements of operations related to derivatives for the three months ended March 31, 2023 and 2022:

For the Three Months Ended March 31, 2023

Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives

22 unchanged sentences

Gains on financial derivatives not designated in hedge relationships $ — $ — $ — $ — $ 399 $ 399

For the Three Months Ended September 30, 2021

Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives

Net Interest Income Non-Interest Income Total

Interest Income Investments and Cash Equivalents Interest Income Farmer Mac Guaranteed Securities and USDA Securities Interest Income Loans Total Interest Expense Losses on financial derivatives

(in thousands)

Total amounts presented in the consolidated statement of operations $ 4,121 $ 42,339 $ 61,923 $ ( 49,467 ) $ ( 888 ) $ 58,028

Income/(expense) related to interest settlements on fair value hedging relationships:

Recognized on derivatives ( 141 ) ( 20,925 ) ( 6,911 ) 10,886 — ( 17,091 )

Recognized on hedged items 274 28,937 11,817 ( 12,940 ) — 28,088

Discount amortization recognized on hedged items — — — ( 287 ) — ( 287 )

Income/(expense) related to interest settlements on fair value hedging relationships $ 133 $ 8,012 $ 4,906 $ ( 2,341 ) $ — $ 10,710

Gains/(losses) on fair value hedging relationships:

Recognized on derivatives $ 1,827 $ 33,972 $ 19,652 $ ( 9,727 ) $ — $ 45,724

Recognized on hedged items ( 1,737 ) ( 31,523 ) ( 19,184 ) 8,712 — ( 43,732 )

Gains/(losses) on fair value hedging relationships $ 90 $ 2,449 $ 468 $ ( 1,015 ) $ — $ 1,992

Expense related to interest settlements on cash flow hedging relationships:

Interest settlements reclassified from AOCI into net income on derivatives $ — $ — $ — $ ( 1,932 ) $ — $ ( 1,932 )

Recognized on hedged items — — — ( 685 ) — ( 685 )

Discount amortization recognized on hedged items — — — ( 11 ) — ( 11 )

Expense recognized on cash flow hedges $ — $ — $ — $ ( 2,628 ) $ — $ ( 2,628 )

Losses on financial derivatives not designated in hedging relationships:

Losses on interest rate swaps $ — $ — $ — $ — $ ( 634 ) $ ( 634 )

Interest expense on interest rate swaps — — — — 168 168

Treasury futures — — — — ( 422 ) ( 422 )

Losses on financial derivatives not designated in hedge relationships $ — $ — $ — $ — $ ( 888 ) $ ( 888 )

For the Nine Months Ended September 30, 2022

For the Three Months Ended March 31, 2022

Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives

3 unchanged sentences

Total amounts presented in the consolidated statement of operations:

Income/(expense) related to interest settlements on fair value hedging relationships:

Recognized on derivatives ( 1,536 ) ( 37,687 ) ( 9,568 ) ( 3,831 ) — ( 52,622 )

Recognized on hedged items 10,433 102,123 41,146 ( 76,862 ) — 76,840

Premium/discount amortization recognized on hedged items ( 816 ) — — ( 1,478 ) — ( 2,294 )

Income/(expense) related to interest settlements on fair value hedging relationships $ 8,081 $ 64,436 $ 31,578 $ ( 82,171 ) $ — $ 21,924

Gains/(losses) on fair value hedging relationships:

Recognized on derivatives $ 106,935 $ 563,897 $ 347,034 $ ( 523,432 ) $ — $ 494,434

Recognized on hedged items ( 108,002 ) ( 564,679 ) ( 337,443 ) 521,643 — ( 488,481 )

Gains/(losses) on fair value hedging relationships $ ( 1,067 ) $ ( 782 ) $ 9,591 $ ( 1,789 ) $ — $ 5,953

Expense related to interest settlements on cash flow hedging relationships:

Interest settlements reclassified from AOCI into net income on derivatives $ — $ — $ — $ ( 2,094 ) $ — $ ( 2,094 )

Recognized on hedged items — — — ( 6,654 ) — ( 6,654 )

Discount amortization recognized on hedged items — — — ( 43 ) — ( 43 )

Expense recognized on cash flow hedges $ — $ — $ — $ ( 8,791 ) $ — $ ( 8,791 )

Gains on financial derivatives not designated in hedging relationships:

Gains on interest rate swaps $ — $ — $ — $ — $ 10,954 $ 10,954

Interest expense on interest rate swaps — — — — ( 5,496 ) ( 5,496 )

Treasury futures — — — — 16,093 16,093

Gains on financial derivatives not designated in hedge relationships $ — $ — $ — $ — $ 21,551 $ 21,551

For the Nine Months Ended September 30, 2021

Net Income/(Expense) Recognized in Consolidated Statement of Operations on Derivatives

Net Interest Income Non-Interest Income Total

Interest Income Investments and Cash Equivalents Interest Income Farmer Mac Guaranteed Securities and USDA Securities Interest Income Loans Total Interest Expense Losses on financial derivatives

(in thousands)

Total amounts presented in the consolidated statement of operations:

$ 5,716 $ 42,920 $ 67,247 $ ( 50,345 ) $ 16,988 $ 82,526

13 unchanged sentences

Expense recognized on cash flow hedges $ — $ — $ — $ ( 2,811 ) $ — $ ( 2,811 )

(Losses)/gains on financial derivatives not designated in hedge relationships:

Losses on interest rate swaps $ — $ — $ — $ — $ ( 662 ) $ ( 662 )

Gains on financial derivatives not designated in hedge relationships:

Gains on interest rate swaps $ — $ — $ — $ — $ 1,617 $ 1,617

Interest expense on interest rate swaps — — — — ( 927 ) ( 927 )

Treasury futures — — — — 16,298 16,298

Losses on financial derivatives not designated in hedge relationships $ — $ — $ — $ — $ 2,581 $ 2,581

The following table shows the carrying amount and associated cumulative basis adjustment related to the application of hedge accounting that is included in the carrying amount of hedged assets and liabilities in fair value hedging relationships as of September 30, 2022 and December 31, 2021:

Gains on financial derivatives not designated in hedge relationships $ — $ — $ — $ — $ 16,988 $ 16,988

Hedged Items in Fair Value Relationship

Carrying Amount of Hedged Assets/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustments included in the Carrying Amount of the Hedged Assets/(Liabilities)

September 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022

(in thousands)

5 unchanged sentences

(1) Carrying amount represents amortized cost.

The following tables present the fair value of financial assets and liabilities, based on the terms of Farmer Mac's master netting arrangements as of September 30, 2022 and December 31, 2021:

September 30, 2022

The following tables present the fair value of financial assets and liabilities, based on the terms of Farmer Mac's master netting arrangements as of March 31, 2023 and December 31, 2022:

March 31, 2023

Gross Amounts Not Offset in the Consolidated Balance Sheet

25 unchanged sentences

Any investment securities posted as collateral are included in the investment securities balances on the consolidated balance sheets.

If Farmer Mac had breached certain provisions of the derivative contracts as of September 30, 2022 or December 31, 2021, it could have been required to settle its obligations under the agreements, but would not have been required to post additional collateral.

As of September 30, 2022 and December 31, 2021, there were no financial derivatives in a net payable position where Farmer Mac was required to pledge collateral which the counterparty had the right to sell or repledge.

Of Farmer Mac's $ 22.4 billion notional amount of interest rate swaps outstanding as of September 30, 2022, $ 18.5 billion were cleared through the swap clearinghouse, the Chicago Mercantile Exchange ("CME").

If Farmer Mac had breached certain provisions of the derivative contracts as of March 31, 2023 or December 31, 2022, it could have been required to settle its obligations under the agreements, but would not have been required to post additional collateral.

As of March 31, 2023 and December 31, 2022, there were no financial derivatives in a net payable position where Farmer Mac was required to pledge collateral which the counterparty had the right to sell or repledge.

Of Farmer Mac's $ 25.0 billion notional amount of interest rate swaps outstanding as of March 31, 2023, $ 20.3 billion were cleared through the swap clearinghouse, the Chicago Mercantile Exchange ("CME").

Of Farmer Mac's $ 23.9 billion notional amount of interest rate swaps outstanding as of December 31, 2022, $ 19.5 billion were cleared through the CME.

During the first nine months of 2022 and throughout 2021, Farmer Mac continued the use of non-cleared basis swaps to prepare for the transition away from the use of LIBOR as a reference rate.

During 2023 and throughout 2022, Farmer Mac continued the use of non-cleared basis swaps to prepare for the transition away from the use of LIBOR as a reference rate.

Farmer Mac classifies loans as either held for investment or held for sale.

1 unchanged sentence

Loans held for sale are reported at the lower of cost or fair value determined on a pooled

As of both September 30, 2022 and December 31, 2021, Farmer Mac had no loans held for sale, respectively.

Farmer Mac did not record any lower of cost or fair value adjustments during the three and nine months ended September 30, 2022 and 2021.

The following table includes loans held for investment and displays the composition of the loan balances as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 As of December 31, 2021

As of both March 31, 2023 and December 31, 2022, Farmer Mac had no loans held for sale.

Under the Agricultural Finance line of business, Farmer Mac has two segments – Farm & Ranch and Corporate AgFinance.

The segments are characterized by similarities in risk attributes and the manner in which Farmer Mac monitors and assesses credit risk.

The following table includes loans held for investment and displays the composition of the loan balances as of March 31, 2023 and December 31, 2022:

As of March 31, 2023 As of December 31, 2022

Unsecuritized In Consolidated Trusts Total Unsecuritized In Consolidated Trusts Total

(in thousands)

Agricultural Finance mortgage loans $ 6,254,755 $ 1,120,403 $ 7,375,158 $ 5,898,370 $ 948,623 $ 6,846,993

Agricultural Finance loans

Farm & Ranch $ 4,837,722 $ 1,468,357 $ 6,306,079 $ 5,150,750 $ 1,211,576 $ 6,362,326

Corporate AgFinance 1,172,864 — 1,172,864 1,166,253 — 1,166,253

Total Agricultural Finance loans 6,010,586 1,468,357 7,478,943 6,317,003 1,211,576 7,528,579

Rural Infrastructure Finance loans 3,178,104 — 3,178,104 3,021,266 — 3,021,266

7 unchanged sentences

Allowance for Losses

The following table is a summary, by asset type, of the allowance for losses as of September 30, 2022 and December 31, 2021:

September 30, 2022 December 31, 2021

The following table is a summary, by asset type, of the allowance for losses as of March 31, 2023 and December 31, 2022:

March 31, 2023 December 31, 2022

Allowance for Losses Allowance for Losses

(in thousands)

Agricultural Finance mortgage loans $ 4,196 $ 3,442

Agricultural Finance loans

Farm & Ranch $ 3,933 $ 4,044

Corporate AgFinance 7,039 2,731

Total Agricultural Finance Loans 10,972 6,775

Rural Infrastructure Finance loans 4,701 8,314

Total $ 15,673 $ 15,089

The following is a summary of the changes in the allowance for losses for the three and nine month period ended September 30, 2022 and 2021:

For the Three Months Ended For the Nine Months Ended

September 30, 2022 September 30, 2021 September 30, 2022 September 30, 2021

Allowance for Losses Allowance for Losses Allowance for Losses Allowance for Losses

The following is a summary of the changes in the allowance for losses for the three months ended March 31, 2023 and 2022:

For the Three Months Ended

March 31, 2023 March 31, 2022

Agricultural Finance loans Rural Infrastructure

Finance loans (3)

Agricultural Finance loans Rural Infrastructure

Finance loans (3)

Farm & Ranch (1)

Corporate AgFinance (2)

Total Farm & Ranch (1)

Corporate AgFinance (2)

(in thousands)

Agricultural Finance mortgage loans

Beginning Balance $ 4,044 $ 2,731 $ 6,775 $ 8,314 $ 2,882 $ 560 $ 3,442 $ 10,599

2 unchanged sentences

Ending Balance $ 3,933 $ 7,039 $ 10,972 $ 4,701 $ 2,875 $ 1,073 $ 3,948 $ 9,622

$ 4,196 $ 3,506 $ 4,196 $ 3,506

Rural Infrastructure Finance loans

Beginning Balance $ 8,388 $ 10,908 $ 10,599 $ 10,087

Provision for/(release of) losses 418 ( 120 ) ( 1,793 ) 701

Charge-offs — — — —

Ending Balance (2)

$ 8,806 $ 10,788 $ 8,806 $ 10,788

(1) As of September 30, 2022 and 2021, allowance for losses for Agricultural Finance mortgage loans includes $ 1.7 million and $ 1.8 million allowance for collateral dependent assets secured by agricultural real estate, respectively.

(2) As of both September 30, 2022 and 2021, allowance for losses for Rural Infrastructure Finance loans includes no allowance for collateral dependent assets.

The net provision to the allowance for Rural Infrastructure Finance loan losses of $ 0.4 million recorded during third quarter 2022 was primarily attributable to net new loan volume.

The $ 0.2 million net provision to the allowance for the Agricultural Finance mortgage loan portfolio during third quarter 2022 was primarily attributable to the deterioration of a single agricultural storage and processing loan.

The $ 1.8 million net release from the allowance for the Rural Infrastructure Finance portfolio for the nine months ended September 30, 2022 was primarily attributable to improvements in forecasts of future economic conditions, and a first quarter risk rating upgrade on a single loan.

The risk rating upgrade on that loan reflected that borrower's successful securitization of its large payable that arose during the arctic freeze that struck Texas in February 2021.

The $ 0.8 million net provision to the allowance for the Agricultural Finance mortgage loan portfolio for the nine months ended September 30, 2022 was primarily attributable to a risk rating downgrade on a single agricultural storage and processing loan.

The release from the allowance for Rural Infrastructure Finance loan losses of $ 0.1 million recorded during third quarter 2021 was primarily attributable to the impact of improving economic factor forecasts.

The $ 0.4 million provision to the allowance for the Agricultural Finance mortgage loan portfolio during third quarter 2021 was primarily attributable to a decline in the economic factor forecast for commodity prices in Farmer Mac's fruit and nuts portfolio.

The net provision recorded to the allowance for the nine months ended September 30, 2021 was primarily

a result of the impact of the Texas Arctic Freeze on the Rural Infrastructure Finance portfolio, partially offset by improving economic factor forecasts.

The net release from the allowance for the nine months ended September 30, 2021 was primarily a result of improving agricultural commodity prices on the Agricultural Finance mortgage loan portfolio in the first half of the year, partially offset by declines in the third quarter.

The following table presents the unpaid principal balances by delinquency status of Farmer Mac's loans and non-performing assets as of September 30, 2022 and December 31, 2021:

As of September 30, 2022

(1) As of March 31, 2023 and 2022, allowance for losses for Agricultural Finance Farm & Ranch loans includes $ 1.1 million and no allowance for collateral dependent assets secured by agricultural real estate, respectively.

(2) As of March 31, 2023 and 2022, allowance for losses for Agricultural Finance Corporate AgFinance loans includes $ 4.6 million and no allowance for collateral dependent assets secured by agricultural real estate, respectively.

(3) As of both March 31, 2023 and 2022, allowance for losses for Rural Infrastructure Finance loans includes no allowance for collateral dependent assets.

The $ 3.6 million net release from the allowance for the Rural Infrastructure Finance portfolio during the quarter ended March 31, 2023 was primarily attributable to an updated estimate of expected losses based on newly available industry data.

The $ 4.2 million net provision to the allowance for the Agricultural Finance mortgage loan portfolio during the quarter ended March 31, 2023 was primarily attributable to declining valuation of a single agricultural storage and processing loan, due to its ongoing bankruptcy proceedings and an updated estimate of expected losses based on additional availability of industry data.

The net release from the allowance for Rural Infrastructure Finance loan losses of $ 1.0 million recorded during first quarter 2022 was primarily attributable to a risk rating upgrade on a single loan related to the borrower's successful securitization of a large payable incurred as a result of the arctic freeze that struck Texas in February 2021, and was partially offset by new loan volume.

The $ 0.6 million net provision to the allowance for the Agricultural Finance mortgage loan portfolio during first quarter 2022 was primarily attributable to a risk rating downgrade on a single agricultural storage and processing loan.

The following table presents the unpaid principal balances by delinquency status of Farmer Mac's loans and non-performing assets as of March 31, 2023 and December 31, 2022:

As of March 31, 2023

Current 30-59 Days 60-89 Days 90 Days and Greater (2)

1 unchanged sentence

(in thousands)

Agricultural Finance mortgage loans $ 7,277,623 $ 4,665 $ 2,424 $ 6,239 $ 13,328 $ 84,207 $ 7,375,158

Agricultural Finance loans

Farm & Ranch $ 6,210,739 $ 4,403 $ 1,989 $ 6,922 $ 13,314 $ 82,026 $ 6,306,079

Corporate AgFinance 1,159,609 — — — — 13,255 1,172,864

Total Agricultural Finance loans 7,370,348 4,403 1,989 6,922 13,314 95,281 7,478,943

Rural Infrastructure Finance loans 3,178,104 — — — — — 3,178,104

4 unchanged sentences

(4) Includes $ 16.1 million of nonaccrual loans for which there was no associated allowance.

During the three and nine months ended September 30, 2022, Farmer Mac received $ 1.3 million and $ 5.0 million in interest on nonaccrual loans, respectively.

During the three months ended March 31, 2023, Farmer Mac received $ 0.5 million in interest on nonaccrual loans.

As of December 31, 2022

2 unchanged sentences

(in thousands)

Agricultural Finance mortgage loans $ 6,715,070 $ 4,548 $ 568 $ — $ 5,116 $ 126,807 $ 6,846,993

Agricultural Finance loans

Farm & Ranch $ 6,287,326 $ 10,066 $ 392 $ 1,140 $ 11,598 $ 63,402 $ 6,362,326

Corporate AgFinance 1,150,690 — — — — 15,563 1,166,253

Total Agricultural Finance loans 7,438,016 10,066 392 1,140 11,598 78,965 7,528,579

Rural Infrastructure Finance loans 3,021,266 — — — — — 3,021,266

6 unchanged sentences

Credit Quality Indicators

The following tables present credit quality indicators related to Agricultural Finance mortgage loans and Rural Infrastructure Finance loans held as of September 30, 2022 and December 31, 2021, by year of origination:

As of September 30, 2022

The following tables present credit quality indicators related to Agricultural Finance mortgage loans and Rural Infrastructure Finance loans held as of March 31, 2023 and December 31, 2022, by year of origination:

As of March 31, 2023

Year of Origination:

1 unchanged sentence

(in thousands)

Agricultural Finance mortgage loans (1) :

Agricultural Finance - Farm & Ranch loans (1) :

Internally Assigned Risk Rating:

5 unchanged sentences

Total $ 114,254 $ 1,243,916 $ 1,738,509 $ 1,200,554 $ 387,733 $ 1,244,914 $ 376,199 $ 6,306,079

For the Three Months Ended September 30, 2022:

For the Three Months Ended March 31, 2023:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2022:

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.

(2) Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.

(3) Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

As of March 31, 2023

Year of Origination:

2023 2022 2021 2020 2019 Prior Revolving Loans - Amortized Cost Basis Total

(in thousands)

Agricultural Finance - Corporate AgFinance (1) :

Internally Assigned Risk Rating:

Acceptable $ 91,825 $ 144,361 $ 280,569 $ 124,825 $ 107,234 $ 119,813 $ 216,575 $ 1,085,202

Special mention (2)

— — — 51,737 20,525 — 2,145 74,407

Substandard (3)

11,099 — — 1,128 — — 1,028 13,255

Total $ 102,924 $ 144,361 $ 280,569 $ 177,690 $ 127,759 $ 119,813 $ 219,748 $ 1,172,864

For the Three Months Ended March 31, 2023:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ ( 84 ) $ — $ ( 84 )

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.

1 unchanged sentence

(3) Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

As of September 30, 2022

As of March 31, 2023

Year of Origination:

9 unchanged sentences

Total $ 247,553 $ 727,714 $ 177,165 $ 619,983 $ 730,252 $ 635,181 $ 40,256 $ 3,178,104

For the Three Months Ended September 30, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2022:

For the Three Months Ended March 31, 2023:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.

5 unchanged sentences

(in thousands)

Agricultural Finance mortgage loans (1) :

Agricultural Finance - Farm & Ranch loans (1) :

Internally Assigned Risk Rating:

5 unchanged sentences

Total $ 1,252,022 $ 1,781,621 $ 1,236,079 $ 395,895 $ 265,661 $ 1,032,986 $ 398,062 $ 6,362,326

For the Three Months Ended September 30, 2021:

For the Three Months Ended March 31, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ ( 84 ) $ — $ ( 84 )

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2021:

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.

(2) Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.

(3) Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

As of December 31, 2022

Year of Origination:

2022 2021 2020 2019 2018 Prior Revolving Loans - Amortized Cost Basis Total

(in thousands)

Agricultural Finance - Corporate AgFinance loans (1) :

Internally Assigned Risk Rating:

Acceptable $ 145,263 $ 299,729 $ 221,560 $ 108,230 $ 76,454 $ 44,827 $ 232,107 $ 1,128,170

Special mention (2)

— — — 20,698 — — 2,145 22,843

Substandard (3)

— — 4,598 — — — 10,642 15,240

Total $ 145,263 $ 299,729 $ 226,158 $ 128,928 $ 76,454 $ 44,827 $ 244,894 $ 1,166,253

For the Three Months Ended March 31, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.

13 unchanged sentences

Total $ 741,021 $ 220,420 $ 629,223 $ 739,270 $ 7,932 $ 649,830 $ 33,570 $ 3,021,266

For the Three Months Ended September 30, 2021:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2021:

For the Three Months Ended March 31, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

(1) Amounts represent unpaid principal balance of risk-rated loans, which is the basis Farmer Mac uses to analyze its portfolio, and recorded investment of past due loans.

2 unchanged sentences

GUARANTEES AND COMMITMENTS

The following table presents the maximum principal amount of potential undiscounted future payments that Farmer Mac could be required to make under all off-balance sheet Farmer Mac Guaranteed Securities as of September 30, 2022 and December 31, 2021, not including offsets provided by any recourse provisions, recoveries from third parties, or collateral for the underlying loans:

The following table presents the maximum principal amount of potential undiscounted future payments that Farmer Mac could be required to make under all off-balance sheet Farmer Mac Guaranteed Securities as of March 31, 2023 and December 31, 2022, not including offsets provided by any recourse provisions, recoveries from third parties, or collateral for the underlying loans:

Outstanding Balance of Off-Balance Sheet Farmer Mac Guaranteed Securities

As of September 30, 2022 As of December 31, 2021

As of March 31, 2023 As of December 31, 2022

(in thousands)

5 unchanged sentences

Eligible loans and other eligible assets may be placed into trusts that are used as vehicles for the securitization of the transferred assets and the Farmer Mac-guaranteed beneficial interests in the trusts are sold to investors.

During third quarter 2022, Farmer Mac executed a structured securitization transaction, whereby it sold and securitized agricultural mortgage loans resulting in $ 297.7 million of Farmer Mac Guaranteed Securities.

In this transaction, Farmer Mac transferred selected loans to a depositor which then deposited the loans into a trust, at which time the loans became assets of the trust.

Farmer Mac does not consider these trust fund assets to be available to satisfy the claims of the creditors of Farmer Mac and/or the depositor.

The following table summarizes the significant cash flows received from and paid to trusts used for Farmer Mac securitizations:

For the Nine Months Ended

September 30, 2022 September 30, 2021

For the Three Months Ended

March 31, 2023 March 31, 2022

(in thousands)

3 unchanged sentences

The following table presents the liability and the weighted-average remaining maturity of all loans underlying off-balance sheet Farmer Mac Guaranteed Securities:

As of September 30, 2022 As of December 31, 2021

As of March 31, 2023 As of December 31, 2022

(dollars in thousands)

6 unchanged sentences

The following table presents the liability, the maximum principal amount of potential undiscounted future payments that Farmer Mac could be requested to make under all LTSPCs, not including offsets provided by any recourse provisions, recoveries from third parties, or collateral for the underlying loans, as well as the weighted-average remaining maturity of all loans underlying LTSPCs:

As of September 30, 2022 As of December 31, 2021

As of March 31, 2023 As of December 31, 2022

(dollars in thousands)

5 unchanged sentences

Reserve for Losses

The following table is a summary, by asset type, of the reserve for losses as of September 30, 2022 and December 31, 2021:

September 30, 2022 December 31, 2021

The following table is a summary, by asset type, of the reserve for losses as of March 31, 2023 and December 31, 2022:

March 31, 2023 December 31, 2022

Reserve for Losses Reserve for Losses

1 unchanged sentence

Agricultural Finance $ 1,396 $ 819

LTSPCs and Farmer Mac Guaranteed Securities $ 743 $ 1,068

Rural Infrastructure Finance 240 614

LTSPCs 767 882

Total $ 1,636 $ 1,433

The following is a summary of the changes in the reserve for losses for the three and nine month periods ended September 30, 2022 and 2021:

For the Three Months Ended For the Nine Months Ended

September 30, 2022 September 30, 2021 September 30, 2022 September 30, 2021

Reserve for Losses Reserve for Losses Reserve for Losses Reserve for Losses

The following is a summary of the changes in the reserve for losses for the three month period ended March 31, 2023 and 2022:

For the Three Months Ended

March 31, 2023 March 31, 2022

Reserve for Losses Reserve for Losses

(in thousands)

Agricultural Finance mortgage loans

Agricultural Finance

Beginning Balance $ 819 $ 1,068

Release of losses ( 139 ) ( 91 ) ( 325 ) ( 994 )

Charge-offs — — — —

Provision for/(release of )losses 577 ( 75 )

Ending Balance $ 1,396 $ 993

Rural Infrastructure Finance loans

Rural Infrastructure Finance

Beginning Balance $ 614 $ 882

Release of losses ( 374 ) ( 35 )

Charge-offs — — — —

Ending Balance $ 240 $ 847

The release from the reserve for losses in both the Agricultural Finance and Rural Infrastructure Finance LTSPC and Farmer Mac Guaranteed portfolios recorded during the three and nine months ended September 30, 2022 was primarily due to improvements in risk ratings in those portfolios.

The release from the reserve for losses in the Rural Infrastructure Finance LTSPC portfolio recorded during the three and nine months ended September 30, 2021 was primarily due to improving economic factor forecasts and ratings upgrades.

The release in the Agricultural Finance LTSPC portfolio was primarily due to ratings upgrades and updated loss-given-default assumptions.

The following table presents the unpaid principal balances by delinquency status of Agricultural Finance and Rural Infrastructure loans underlying LTSPCs and Farmer Mac Guaranteed Securities as of September 30, 2022 and December 31, 2021:

As of September 30, 2022

The release from the reserve for losses in the Rural Infrastructure Finance LTSPC portfolio recorded during first quarter 2023 was primarily due to an updated estimate of expected losses based on additional available industry data.

The provision to the reserve for losses in the Agricultural Finance LTSPC portfolio recorded during first quarter 2023 was primarily due to an updated estimate of expected losses based on additional available industry data.

The release from the reserve for losses in both the Agricultural Finance and Rural Infrastructure Finance

LTSPC portfolios and Farmer Mac Guaranteed portfolios recorded during the three months ended March 31, 2022

was primarily due to decreased net volume in those portfolios.

As of March 31, 2023

Current 30-59 Days 60-89 Days 90 Days and Greater (1)

2 unchanged sentences

Agricultural Finance:

LTSPCs and Farmer Mac Guaranteed Securities $ 3,127,963 $ 2,586 $ 626 $ 2,217 $ 5,429 $ 3,133,392

Rural Infrastructure:

LTSPCs $ 541,228 $ — $ — $ — $ — $ 541,228

(1) Includes loans underlying off-balance sheet Agricultural Finance Guaranteed Securities and LTSPCs that are 90 days of more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.

$ 3,193,633 $ 2,432 $ 366 $ 5,045 $ 7,843 $ 3,201,476

Rural Infrastructure Finance:

503,588 — — — — 503,588

Total $ 3,697,221 $ 2,432 $ 366 $ 5,045 $ 7,843 $ 3,705,064

(1) Includes loans underlying off-balance sheet Farmer Mac Guaranteed Securities and LTSPCs that are 90 days of more past due, in foreclosure, or in bankruptcy with at least one missed payment, excluding loans performing under either their original loan terms or a court-approved bankruptcy plan.

As of December 31, 2022

3 unchanged sentences

Agricultural Finance:

LTSPCs and Farmer Mac Guaranteed Securities $ 2,953,091 $ 8,068 $ — $ 3,597 $ 11,665 $ 2,964,756

Rural Infrastructure:

LTSPCs $ 556,837 $ — $ — $ — $ — $ 556,837

$ 3,174,939 $ 11,614 $ 622 $ 3,817 $ 16,053 $ 3,190,992

Rural Infrastructure Finance:

523,192 — — — — 523,192

Total $ 3,698,131 $ 11,614 $ 622 $ 3,817 $ 16,053 $ 3,714,184

Credit Quality Indicators

The following tables present credit quality indicators related to Agricultural Finance and Rural Infrastructure loans underlying LTSPCs and Farmer Mac Guaranteed Securities as of September 30, 2022 and December 31, 2021, by year of origination:

As of September 30, 2022

The following tables present credit quality indicators related to Agricultural Finance and Rural Infrastructure loans underlying LTSPCs and Farmer Mac Guaranteed Securities as of March 31, 2023 and December 31, 2022, by year of origination:

As of March 31, 2023

Year of Origination:

1 unchanged sentence

(in thousands)

Agricultural Finance LTSPCs and Farmer Mac Guaranteed Securities:

Agricultural Finance:

Internally Assigned Risk Rating:

5 unchanged sentences

Total $ 36,192 $ 232,884 $ 493,125 $ 531,462 $ 255,456 $ 1,343,393 $ 308,964 $ 3,201,476

For the Three Months Ended September 30, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2022:

For the Three Months Ended March 31, 2023:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

(1) Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.

(2) Substandard assets have a well-defined weakness or weaknesses and there is a distinct possibility that some loss will be sustained if deficiencies are not corrected.

As of September 30, 2022

As of March 31, 2023

Year of Origination:

1 unchanged sentence

(in thousands)

Rural Infrastructure Finance LTSPCs:

Rural Infrastructure Finance:

Internally Assigned Risk Rating:

5 unchanged sentences

Total $ — $ — $ — $ — $ — $ 441,459 $ 62,129 $ 503,588

For the Three Months Ended September 30, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2022:

For the Three Months Ended March 31, 2023:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

(1) Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.

4 unchanged sentences

(in thousands)

Agricultural Finance LTSPCs and Farmer Mac Guaranteed Securities:

Agricultural Finance:

Internally Assigned Risk Rating:

5 unchanged sentences

Total $ 202,998 $ 497,588 $ 537,752 $ 254,293 $ 212,165 $ 1,183,111 $ 303,085 $ 3,190,992

For the Three Months Ended September 30, 2021:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2021:

For the Three Months Ended March 31, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Agricultural Finance net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

(1) Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.

4 unchanged sentences

(in thousands)

Rural Infrastructure Finance LTSPCs:

Rural Infrastructure Finance:

Internally Assigned Risk Rating:

5 unchanged sentences

Total $ — $ — $ — $ — $ — $ 470,659 $ 52,533 $ 523,192

For the Three Months Ended September 30, 2021:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

For the Nine Months Ended September 30, 2021:

For the Three Months Ended March 31, 2022:

Current period charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period recoveries — — — — — — — —

Current period Rural Infrastructure net charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

(1) Assets in the "Special mention" category generally have potential weaknesses due to performance issues but are currently considered to be adequately secured.

3 unchanged sentences

Discount notes generally have original maturities of 1.0 year or less, whereas medium-term notes generally have maturities of 0.5 years to 25.0 years.

The following tables set forth information related to Farmer Mac's borrowings as of September 30, 2022 and December 31, 2021:

September 30, 2022

Outstanding as of September 30 Average Outstanding During the Quarter

The following tables set forth information related to Farmer Mac's borrowings as of March 31, 2023 and December 31, 2022:

March 31, 2023

Outstanding as of March 31

Average Outstanding During the Quarter

Amount Weighted- Average Rate Amount Weighted- Average Rate

36 unchanged sentences

Total $ 24,469,113

The maximum amount of Farmer Mac's discount notes outstanding at any month end during the nine months ended September 30, 2022 and 2021 was $ 2.2 billion and $ 2.4 billion, respectively.

The maximum amount of Farmer Mac's discount notes outstanding at any month end during each of the three months ended March 31, 2023 and 2022 was $ 0.9 billion and $ 2.2 billion, respectively.

Callable medium-term notes give Farmer Mac the option to redeem the debt at par value on a specified call date or at any time on or after a specified call date.

The following table summarizes by maturity date the amounts and costs for Farmer Mac debt callable in 2022 as of September 30, 2022:

Debt Callable in 2022 as of September 30, 2022, by Maturity

The following table summarizes by maturity date the amounts and costs for Farmer Mac debt callable in 2023 as of March 31, 2023:

Debt Callable in 2023 as of March 31, 2023, by Maturity

Amount Weighted-Average Rate

6 unchanged sentences

Total $ 4,907,057 2.04 %

The following schedule summarizes the earliest interest rate reset date, or debt maturities, of total borrowings outstanding as of September 30, 2022, including callable and non-callable medium-term notes, assuming callable notes are redeemed at the initial call date:

The following schedule summarizes the earliest interest rate reset date, or debt maturities, of total borrowings outstanding as of March 31, 2023, including callable and non-callable medium-term notes, assuming callable notes are redeemed at the initial call date:

Earliest Interest Rate Reset Date, or Debt Maturities, of Borrowings Outstanding

9 unchanged sentences

Total principal net of discounts $ 25,245,778 2.45 %

During the nine months ended September 30, 2022 and 2021, Farmer Mac called $ 26.0 million and $ 1.7 billion of callable medium-term notes, respectively.

During the three months ended March 31, 2023 and 2022, Farmer Mac called none and $ 26.0 million of callable medium-term notes, respectively.

Authority to Borrow from the U.S.

4 unchanged sentences

Any debt obligations issued by Farmer Mac under this authority would bear interest at a rate determined by the U.S.

Treasury, taking into consideration the average rate on outstanding marketable obligations of the United States as of the last day of the last calendar month ending before the date of the purchase of the obligations from Farmer Mac.

obligations from Farmer Mac.

The charter requires Farmer Mac to repurchase any of its debt obligations held by the U.S.

Treasury within a reasonable time.

As of September 30, 2022, Farmer Mac had not used this borrowing authority.

Gains on Repurchase of Outstanding Debt

No outstanding debt repurchases were made in the three and nine months ended September 30, 2022.

During the three and nine months ended September 30, 2021, Farmer Mac repurchased $ 23.0 million of

outstanding debt at a gain of $ 14,000 .

During each of the first, second, and third quarters 2022, Farmer Mac paid a quarterly dividend of $ 0.95 per share on all classes of its common stock.

For each quarter in 2021, Farmer Mac paid a quarterly dividend of $ 0.88 per share on all classes of its common stock.

As of March 31, 2023, Farmer Mac had not used this borrowing authority.

Gains on Repurchases of Outstanding Debt

No outstanding debt repurchases were made in the three months ended March 31, 2023 and 2022.

During first quarter 2023, Farmer Mac paid a quarterly dividend of $ 1.10 per share on all classes of its common stock.

For each quarter in 2022, Farmer Mac paid a quarterly dividend of $ 0.95 per share on all

classes of its common stock.

Farmer Mac's board of directors approved a share repurchase program during third quarter 2015 authorizing Farmer Mac to repurchase up to $ 25.0 million of its outstanding Class C non-voting common stock.

3 unchanged sentences

In March 2021, Farmer Mac's board of directors reinstated the share repurchase program on its previous terms (with a remaining authorization of up to $ 9.8 million in stock repurchases) and extended the expiration date of the program to March 2023.

Farmer Mac did no t repurchase any shares of its Class C non-voting common stock during the first nine months of 2022.

As of September 30, 2022, Farmer Mac had repurchased approximately 673,000 shares of Class C non-voting common stock at a cost of approximately $ 19.8 million under the share repurchase program since 2015.

Farmer Mac did no t repurchase any shares of its Class C non-voting common stock during first quarter 2023.

As of March 31, 2023, Farmer Mac had repurchased approximately 673,000 shares of Class C non-voting common stock at a cost of approximately $ 19.8 million under the share repurchase program since 2015.

Capital Requirements

Farmer Mac is required to comply with the higher of the minimum capital requirement and the risk-based capital requirement.

As of both September 30, 2022 and December 31, 2021, the minimum capital requirement was greater than the risk-based capital requirement.

As of both March 31, 2023 and December 31, 2022, the minimum capital requirement was greater than the risk-based capital requirement.

Farmer Mac's ability to declare and pay dividends could be restricted if it fails to comply with applicable capital requirements.

As of September 30, 2022, Farmer Mac's minimum capital requirement was $ 781.7 million and its core capital level was $ 1.3 billion, which was $ 513.9 million above the minimum capital requirement as of that date.

As of March 31, 2023, Farmer Mac's minimum capital requirement was $ 817.9 million and its core capital level was $ 1.4 billion, which was $ 534.4 million above the minimum capital requirement as of that date.

As of December 31, 2022, Farmer Mac's minimum capital requirement was $ 805.9 million and its core capital level was $ 1.3 billion, which was $ 516.9 million above the minimum capital requirement as of that date.

In accordance with the Farm Credit Administration's rule on Farmer Mac's capital planning, and as part of Farmer Mac's capital plan, Farmer Mac has adopted a policy for maintaining a sufficient level of Tier 1 capital (consisting of retained earnings, paid-in-capital, common stock, and qualifying preferred stock) and imposing restrictions on Tier 1-eligible dividends and any discretionary bonus payments in the event that this capital falls below specified thresholds.

In accordance with a rule of the Farm Credit Administration ("FCA") on Farmer Mac's capital planning, and as part of Farmer Mac's capital plan, Farmer Mac has adopted a policy for maintaining a sufficient level of Tier 1 capital (consisting of retained earnings, paid-in-capital, common stock, and qualifying

preferred stock) and imposing restrictions on Tier 1-eligible dividends and any discretionary bonus payments in the event that this capital falls below specified thresholds.

FAIR VALUE DISCLOSURES

Fair Value Classification and Transfers

The following tables present information about Farmer Mac's assets and liabilities measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021, respectively, and indicate the fair value hierarchy of the valuation techniques used by Farmer Mac to determine such fair value:

Assets and Liabilities Measured at Fair Value as of September 30, 2022

The following tables present information about Farmer Mac's assets and liabilities measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022, respectively, and indicate the fair value hierarchy of the valuation techniques used by Farmer Mac to determine such fair value:

Assets and Liabilities Measured at Fair Value as of March 31, 2023

Level 1 Level 2 Level 3 (1)

46 unchanged sentences

Total Liabilities at fair value $ 142 $ 175,184 $ — $ 175,326

Non-recurring:

Mortgage Servicing Rights $ — $ — $ 2,681 $ 2,681

Total non-recurring assets at fair value $ — $ — $ 2,681 $ 2,681

(1) Level 3 assets represent 28 % of total assets and 62 % of financial instruments measured at fair value.

There were no material assets or liabilities measured at fair value on a non-recurring basis as of September 30, 2022 or December 31, 2021.

There were no material assets or liabilities measured at fair value on a non-recurring basis as of March 31, 2023 or December 31, 2022.

Transfers in and/or out of the different levels within the fair value hierarchy are based on the fair values of the assets and liabilities as of the beginning of the reporting period.

During the nine months ended September 30, 2022 and 2021, there were no transfers within the fair value hierarchy.

During the three months ended March 31, 2023 and 2022, there were no transfers within the fair value hierarchy.

The following tables present additional information about assets and liabilities measured at fair value on a recurring basis for which Farmer Mac has used significant unobservable inputs to determine fair value.

Net transfers in and/or out of Level 3 are based on the fair values of the assets and liabilities as of the beginning of the reporting period.

There were no liabilities measured at fair value using significant unobservable inputs during the three and nine months ended September 30, 2022 and 2021.

Level 3 Assets and Liabilities Measured at Fair Value for the Three Months Ended September 30, 2022

Beginning Balance Purchases Sales Settlements Allowance for Losses Realized and

unrealized losses included

in Income Unrealized gains/(losses)

There were no liabilities measured at fair value using significant unobservable inputs during the three months ended March 31, 2023 and 2022.

Level 3 Assets and Liabilities Measured at Fair Value for the Three Months Ended March 31, 2023

Beginning Balance Purchases Settlements Allowance for Losses Realized and

unrealized gains included

in Income Unrealized (losses)/gains

included in Other

18 unchanged sentences

Total Assets at fair value $ 7,632,487 $ 687,650 $ ( 142,437 ) $ 36 $ 93,701 $ ( 20,977 ) $ 8,250,460

Level 3 Assets and Liabilities Measured at Fair Value for the Three Months Ended September 30, 2021

Beginning Balance Purchases Sales Settlements Allowance for Losses Realized and

Level 3 Assets and Liabilities Measured at Fair Value for the Three Months Ended March 31, 2022

Beginning Balance Purchases Settlements Allowance for Losses Realized and

unrealized (losses)/gains included

in Income Unrealized gains

included in Other

Comprehensive

Income Ending Balance

(in thousands)

Investment Securities:

Available-for-sale:

Floating rate auction-rate certificates backed by Government guaranteed student loans $ 19,248 $ — $ — $ — $ 6 $ — $ 246 $ 19,500

Total available-for-sale 19,248 — — — 6 — 246 19,500

Farmer Mac Guaranteed Securities:

Available-for-sale:

AgVantage 6,877,405 — — ( 708,882 ) ( 70 ) ( 31,462 ) 1,768 6,138,759

Total available-for-sale 6,877,405 — — ( 708,882 ) ( 70 ) ( 31,462 ) 1,768 6,138,759

USDA Securities:

Trading 5,050 — — ( 294 ) — 37 — 4,793

Total USDA Securities 5,050 — — ( 294 ) — 37 — 4,793

Total Assets at fair value $ 6,901,703 $ — $ — $ ( 709,176 ) $ ( 64 ) $ ( 31,425 ) $ 2,014 $ 6,163,052

Level 3 Assets and Liabilities Measured at Fair Value for the Nine Months Ended September 30, 2022

Beginning Balance Purchases Sales Settlements Allowance for Losses Realized and

unrealized losses included

in Income Unrealized losses

10 unchanged sentences

AgVantage 6,316,145 832,750 ( 295,284 ) ( 418 ) ( 210,587 ) ( 53,382 ) 6,589,224

Farmer Mac Guaranteed Securities 12,414 — — ( 1,205 ) — — ( 2,968 ) 8,241

Farmer Mac Guaranteed

Securities 12,414 — ( 379 ) — — ( 1,013 ) 11,022

Total available-for-sale 6,328,559 832,750 ( 295,663 ) ( 418 ) ( 210,587 ) ( 54,395 ) 6,600,246

6 unchanged sentences

Total Assets at fair value $ 6,358,451 $ 832,750 $ ( 296,870 ) $ ( 416 ) $ ( 210,494 ) $ ( 54,690 ) $ 6,628,731

Level 3 Assets and Liabilities Measured at Fair Value for the Nine Months Ended September 30, 2021

Beginning Balance Purchases Sales Settlements Allowance for Losses Realized and

unrealized losses included

in Income Unrealized gains

included in Other

Comprehensive

Income Ending Balance

(in thousands)

Investment Securities:

Available-for-sale:

Floating rate auction-rate certificates backed by Government guaranteed student loans $ 19,171 $ — $ — $ — $ ( 16 ) $ — $ 345 $ 19,500

Total available-for-sale 19,171 — — — ( 16 ) — 345 19,500

Farmer Mac Guaranteed Securities:

Available-for-sale:

AgVantage 6,947,701 578,115 — ( 1,263,117 ) 19 ( 150,265 ) 26,306 6,138,759

Total available-for-sale 6,947,701 578,115 — ( 1,263,117 ) 19 ( 150,265 ) 26,306 6,138,759

USDA Securities:

Trading 6,695 — — ( 1,864 ) — ( 38 ) — 4,793

Total USDA Securities 6,695 — — ( 1,864 ) — ( 38 ) — 4,793

Total Assets at fair value $ 6,973,567 $ 578,115 $ — $ ( 1,264,981 ) $ 3 $ ( 150,303 ) $ 26,651 $ 6,163,052

The following tables present additional information about the significant unobservable inputs, such as discount rates and constant prepayment rates ("CPR"), used in the fair value measurements categorized in Level 3 of the fair value hierarchy as of September 30, 2022 and December 31, 2021:

As of September 30, 2022

As of March 31, 2023

Financial Instruments Fair Value Valuation Technique Unobservable Input Range (Weighted-Average)

19 unchanged sentences

Guarantee Asset $ 4,467 Discounted cash flow Discount rate 5.4 % - 5.9 % ( 5.7 %)

CPR 7 % - 12 % ( 8 %)

The significant unobservable input used in the fair value measurements of AgVantage Farmer Mac Guaranteed Securities is the discount rate commensurate with the risks involved.

9 unchanged sentences

Disclosures on Fair Value of Financial Instruments

The following table sets forth the estimated fair values and carrying values for financial assets, liabilities, and guarantees and commitments as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 As of December 31, 2021

The following table sets forth the estimated fair values and carrying values for financial assets, liabilities, and guarantees and commitments as of March 31, 2023 and December 31, 2022:

As of March 31, 2023 As of December 31, 2022

Fair Value Carrying

22 unchanged sentences

These fair value measurements do not take into consideration the fair value of the underlying property and are classified as Level 3.

Financial derivatives primarily are valued using unadjusted counterparty valuations and are classified as Level 2.

The fair value of the

guarantee fees receivable/obligation and debt securities of consolidated trusts are estimated based on the present value of expected future cash flows of the underlying mortgage assets using management's best estimate of certain key assumptions, which include prepayments speeds, forward yield curves, and discount rates commensurate with the risks involved and are classified as Level 3.

Financial derivatives primarily are valued using the market standard methodology of netting the discounted future fixed cash payments (or

receipts) and the discounted expected variable cash receipts (or payments) and are classified as Level 2.

The fair value of the guarantee fees receivable/obligation and debt securities of consolidated trusts are estimated based on the present value of expected future cash flows of the underlying mortgage assets using management's best estimate of certain key assumptions, which include prepayments speeds, forward yield curves, and discount rates commensurate with the risks involved and are classified as Level 3.

Notes payable are valued by discounting the expected cash flows of these instruments using a yield curve derived from market prices observed for similar agency securities and are also classified as Level 3.

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These differences would 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 operating expenses, dividends and interest expense related to the issuance of capital and the issuance of indebtedness managed at the corporate level.

The following tables present core earnings for Farmer Mac's segments and a reconciliation to consolidated net income for the three and nine months ended September 30, 2022 and 2021.

The amounts for the three and nine months ended September 30, 2021 have been revised to conform to the current year's segment alignment.

Core Earnings by Business Segment

For the Three Months Ended September 30, 2022

Agricultural Finance Rural Infrastructure Treasury Corporate

Farm & Ranch Corporate AgFinance Rural

Renewable Energy Funding Investments Reconciling

Adjustments Consolidated Net Income

(in thousands)

Net interest income $ 34,173 $ 7,600 $ 4,253 $ 705 $ 23,913 $ ( 2,791 ) $ — $ — $ 67,853

reconciling adjustments (1)(2)(3)

( 830 ) — ( 33 ) — ( 1,349 ) — — 2,212 —

Net effective spread 33,343 7,600 4,220 705 22,564 ( 2,791 ) — 2,212 —

Guarantee and commitment fees 3,833 46 309 13 — — — ( 1,558 ) 2,643

Other income/(expense) (3)

469 4 — — — — — 909 1,382

Total revenues 37,645 7,650 4,529 718 22,564 ( 2,791 ) — 1,563 71,878

Release of/(provision for) losses 93 ( 333 ) ( 414 ) 26 — 11 — — ( 617 )

Release of reserve for losses 139 — 28 — — — — — 167

Operating expenses — — — — — — ( 19,379 ) — ( 19,379 )

Total non-interest expense 139 — 28 — — — ( 19,379 ) — ( 19,212 )

Core earnings before income taxes 37,877 7,317 4,143 744 22,564 ( 2,780 ) ( 19,379 ) 1,563 (4)

Income tax (expense)/benefit ( 7,953 ) ( 1,536 ) ( 869 ) ( 156 ) ( 4,739 ) 584 4,366 ( 328 ) ( 10,631 )

Core earnings before preferred stock dividends 29,924 5,781 3,274 588 17,825 ( 2,196 ) ( 15,013 ) 1,235 (4)

Preferred stock dividends — — — — — — ( 6,791 ) — ( 6,791 )

Segment core earnings/(losses) $ 29,924 $ 5,781 $ 3,274 $ 588 $ 17,825 $ ( 2,196 ) $ ( 21,804 ) $ 1,235 (4)

Total Assets $ 14,113,686 $ 1,558,139 $ 5,779,300 $ 186,832 $ — $ 4,608,868 $ 194,763 $ — 26,441,588

Total on- and off-balance sheet program assets at principal balance $ 17,199,347 $ 1,634,786 $ 6,296,263 $ 196,242 $ — $ — $ — $ — 25,326,638

(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) 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.

The following tables present core earnings for Farmer Mac's segments and a reconciliation to consolidated net income for the three months ended March 31, 2023 and 2022.

Core Earnings by Business Segment

For the Three Months Ended September 30, 2021

For the Three Months Ended March 31, 2023

Agricultural Finance Rural Infrastructure Treasury Corporate

12 unchanged sentences

Release of/(provision for) losses 128 ( 4,301 ) 3,484 138 — 4 — — ( 547 )

Provision for reserve for losses 91 — 20 — — — — — 111

(Provision for)/release of reserve for losses ( 577 ) — 374 — — — — — ( 203 )

Operating expenses — — — — — — ( 23,713 ) — ( 23,713 )

4 unchanged sentences

Preferred stock dividends — — — — — — ( 6,791 ) — ( 6,791 )

Loss on retirement of preferred stock — — — — — — — — —

Segment core earnings/(losses) $ 29,526 $ 2,291 $ 7,620 $ 809 $ 25,073 $ ( 426 ) $ ( 26,009 ) $ 1,360 (4)

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(3) Includes the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "Gains on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment.

(4) Net adjustments to reconcile to the corresponding income measures:

3 unchanged sentences

Core Earnings by Business Segment

For the Nine Months Ended September 30, 2022

For the Three Months Ended March 31, 2022

Agricultural Finance Rural Infrastructure Treasury Corporate

11 unchanged sentences

Total revenues 34,970 7,342 3,445 411 16,738 4 — 23,923 86,833

Release of/(provision for) losses 440 ( 1,498 ) 1,927 ( 184 ) — 14 — — 699

(Provision for)/release of losses ( 510 ) ( 515 ) 1,169 ( 202 ) — 2 — — ( 56 )

Release of reserve for losses 75 — 35 — — — — — 110

10 unchanged sentences

(4) 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

Agricultural Finance Rural Infrastructure Treasury Corporate

Farm & Ranch Corporate AgFinance Rural

Renewable Energy Funding Investments Reconciling

Adjustments Consolidated Net Income

(in thousands)

Net interest income $ 88,186 $ 20,760 $ 5,648 $ 863 $ 52,260 $ 398 $ — $ — $ 168,115

reconciling adjustments (1)(2)(3)

( 3,647 ) — ( 102 ) — 1,969 — — 1,780 —

Net effective spread 84,539 20,760 5,546 863 54,229 398 — 1,780 —

Guarantee and commitment fees 11,906 18 958 14 — — — ( 3,714 ) 9,182

Other income/(expense) (3)

1,560 — 4 — — — ( 125 ) 2,957 4,396

Total revenues 98,005 20,778 6,508 877 54,229 398 ( 125 ) 1,023 181,693

Release of/(provision for) losses 322 ( 157 ) ( 490 ) ( 177 ) — ( 16 ) — — ( 518 )

Provision for reserve for losses 996 — 281 — — — — — 1,277

Operating expenses — — — — — — ( 52,866 ) — ( 52,866 )

Total non-interest expense 996 — 281 — — — ( 52,866 ) — ( 51,589 )

Core earnings before income taxes 99,323 20,621 6,299 700 54,229 382 ( 52,991 ) 1,023 (4)

Income tax (expense)/benefit ( 20,857 ) ( 4,330 ) ( 1,322 ) ( 147 ) ( 11,388 ) ( 80 ) 10,989 ( 215 ) ( 27,350 )

Core earnings before preferred stock dividends 78,466 16,291 4,977 553 42,841 302 ( 42,002 ) 808 (4)

Preferred stock dividends — — — — — — ( 17,885 ) — ( 17,885 )

Segment core earnings/(losses) $ 78,466 $ 16,291 $ 4,977 $ 553 $ 42,841 $ 302 $ ( 59,887 ) $ 808 (4)

Total Assets $ 12,845,105 $ 1,347,182 $ 5,511,782 $ 88,738 $ — $ 4,919,431 $ 32,130 $ — $ 24,744,368

Total on- and off-balance sheet program assets at principal balance $ 15,565,589 $ 1,379,816 $ 6,080,691 $ 92,695 $ — $ — $ — $ — $ 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.

(4) Net adjustments to reconcile to the corresponding income measures:

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Although Farmer Mac has concluded these errors are immaterial to the previously issued consolidated financial statements, Farmer Mac has corrected this error by revising the accompanying consolidated financial statements.

Farmer Mac will also correct previously reported financial information for such immaterial errors in future filings, as applicable.

Farmer Mac will also correct previously reported financial information

for such immaterial errors in future filings, as applicable.

The following tables summarize the effect of the revision on each financial statement line item:

Revised Consolidated Balance Sheet

As of December 31, 2021

As previously Reported Adjustments As Revised

(in thousands)

Financial Derivatives, at fair value $ 19,139 $ ( 13,058 ) $ 6,081

Interest Receivable 177,355 ( 11,751 ) 165,604

Deferred Tax Asset, net 15,558 311 15,869

Prepaid Expenses and Other Assets 45,318 16 45,334

Total Assets $ 25,145,491 $ ( 24,482 ) $ 25,121,009

Notes Payable $ 22,716,156 $ ( 2,385 ) $ 22,713,771

Financial Derivatives, at fair value 34,248 1,306 35,554

Accrued Interest Payable 83,992 ( 24,989 ) 59,003

Accounts Payable and Accrued Expenses 79,427 ( 7,701 ) 71,726

Total Liabilities $ 23,941,078 $ ( 33,769 ) $ 23,907,309

Retained Earnings $ 579,270 $ 9,287 $ 588,557

Total Equity 1,204,413 9,287 1,213,700

Total Liabilities and Equity $ 25,145,491 $ ( 24,482 ) $ 25,121,009

Revised Consolidated Statements of Operations

Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021

As previously Reported Adjustments As Revised As previously Reported Adjustments As Revised

Three Months Ended March 31, 2022

As previously Reported Adjustments As Revised

(in thousands)

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Revised Consolidated Statements of Comprehensive Income

Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021

As previously Reported Adjustments As Revised As previously Reported Adjustments As Revised

Three Months Ended March 31, 2022

As previously Reported Adjustments As Revised

(in thousands)

8 unchanged sentences

Balance as of March 31, 2022 $ 610,087 $ 12,903 $ 622,990 $ 1,192,844 $ 12,903 $ 1,205,747

Net Income 45,896 ( 4,041 ) 41,855 45,896 ( 4,041 ) 41,855

Balance as of June 30, 2022 $ 638,935 $ 8,862 $ 647,797 $ 1,212,348 $ 8,862 $ 1,221,210

Retained Earnings Total Equity

As previously Reported Adjustments As Revised As previously Reported Adjustments As Revised

(in thousands)

Balance as of December 31, 2020 $ 509,560 $ 5,457 $ 515,017 $ 992,477 $ 5,457 $ 997,934

Net Income 33,227 4,842 38,069 33,227 4,842 38,069

Balance as of March 31, 2021 $ 528,068 $ 10,299 $ 538,367 $ 1,077,492 $ 10,299 $ 1,087,791

Net Income 31,286 ( 2,423 ) 28,863 31,286 ( 2,423 ) 28,863

Balance as of June 30, 2021 $ 544,038 $ 7,876 $ 551,914 $ 1,180,215 $ 7,876 $ 1,188,091

Net Income 31,063 4,242 35,305 31,063 4,242 35,305

Balance as of September 30, 2021 $ 558,853 $ 12,118 $ 570,971 $ 1,197,298 $ 12,118 $ 1,209,416

Revised Consolidated Statements of Cash Flows

For the Nine Months Ended September 30, 2021

Three Months Ended March 31, 2022

As previously Reported Adjustments As Revised

12 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements