FEDERAL AGRICULTURAL MORTGAGE CORP 10-K

Item 8. Financial Statements Management's Report on Internal Control over Financial Reporting The management of Farmer Mac is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f). Internal control over financial reporting is a process designed under the supervision of Farmer Mac's Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Farmer Mac's financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Farmer Mac's internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Farmer Mac; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of Farmer Mac are being made only in accordance with authorizations of management and directors of Farmer Mac; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of Farmer Mac's assets that could have a material effect on the consolidated financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of Farmer Mac's Chief Executive Officer and Chief Financial Officer, Farmer Mac's management assessed the effectiveness of Farmer Mac's internal control over financial reporting as of December 31, 2025. In making this assessment, Farmer Mac's management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control - Integrated Framework (2013) . Based on its evaluation under the COSO criteria, management concluded that Farmer Mac's internal control over financial reporting as of December 31, 2025 was effective. Farmer Mac's independent registered public accounting firm, PricewaterhouseCoopers LLP, has audited the effectiveness of Farmer Mac's internal control over financial reporting as of December 31, 2025, as stated in their report appearing below. 94 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of the Federal Agricultural Mortgage Corporation Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of the Federal Agricultural Mortgage Corporation and its subsidiaries (the "Company") as of December 31, 2025 and 2024, and the related consolidated statements of operations, of comprehensive income, of equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes (collectively referred to as the "consolidated financial statements"). We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. Basis for Opinions The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, 95 assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Valuation of AgVantage Securities As described in Notes 4 and 11 to the consolidated financial statements, as of December 31, 2025, the Company had $6.7 billion of available-for-sale AgVantage securities measured at fair value on a recurring basis and are classified as Level 3 within the fair value hierarchy, and $1.5 billion of held-to-maturity AgVantage securities disclosed at fair value. Management applies a discount rate in calculating the net present value of future expected cash flows that is both significant to the estimate of the fair value of AgVantage securities and unobservable in the market. The principal considerations for our determination that performing procedures relating to the valuation of AgVantage securities is a critical audit matter are (i) the high degree of audit effort in performing procedures related to the valuation of AgVantage securities and evaluating audit evidence related to the discount rate assumption and (ii) the audit effort involved the use of professionals with specialized skill and knowledge. 96 Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the valuation of the AgVantage securities, including controls over the discount rate assumption. These procedures also included, among others, (i) testing the completeness and accuracy of certain data provided by management and (ii) the involvement of professionals with specialized skill and knowledge to assist in evaluating the reasonableness of management’s estimate by (a) developing an independent range of prices for a sample of AgVantage securities using an independently developed discount rate assumption and (b) comparing the independent range of prices to management’s estimate. /s/ PricewaterhouseCoopers LLP Washington, District of Columbia February 19, 2026 We have served as the Company’s auditor since 2010. 97 FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of December 31, 2025 December 31, 2024 (in thousands) Assets: Cash and cash equivalents (includes restricted cash of $ 24,475 and $ 16,190 , respectively) $ 931,067 $ 1,024,007 Investment securities: Available-for-sale, at fair value (amortized cost of $ 13,813,551 and $ 11,940,774 , respectively) 13,580,285 11,467,560 Held-to-maturity, at amortized cost 3,954,223 5,097,492 Other investments 15,871 11,835 Total Investment Securities 17,550,379 16,576,887 Loans: Loans held for sale, at lower of cost or fair value — 6,170 Loans held for investment, at amortized cost 13,877,051 11,183,408 Loans held for investment in consolidated trusts, at amortized cost 2,482,010 2,038,283 Allowance for losses ( 37,785 ) ( 23,223 ) Total loans, net of allowance 16,321,276 13,204,638 Financial derivatives, at fair value 44,875 27,789 Accrued interest receivable (includes $ 40,945 and $ 28,563 , respectively, related to consolidated trusts) 357,155 310,592 Guarantee and commitment fees receivable 57,214 50,499 Deferred tax asset, net 173 1,544 Prepaid expenses and other assets 108,018 128,786 Total Assets $ 35,370,157 $ 31,324,742 Liabilities and Equity: Liabilities: Notes payable $ 30,822,570 $ 27,371,174 Debt securities of consolidated trusts held by third parties 2,365,435 1,929,628 Financial derivatives, at fair value 21,618 77,326 Accrued interest payable (includes $ 15,795 and $ 12,387 , respectively, related to consolidated trusts) 233,714 195,113 Guarantee and commitment obligation 54,770 48,326 Other liabilities 153,101 214,149 Total Liabilities 33,651,208 29,835,716 Commitments and Contingencies (Note 10) Equity: Preferred stock: Series D, par value $ 25 per share, 4,000,000 shares authorized, issued and outstanding 96,659 96,659 Series E, par value $ 25 per share, 3,180,000 shares authorized, issued and outstanding 77,003 77,003 Series F, par value $ 25 per share, 4,800,000 shares authorized, issued and outstanding 116,160 116,160 Series G, par value $ 25 per share, 5,000,000 shares authorized, issued and outstanding 121,327 121,327 Series H, par value $ 25 per share, 4,000,000 shares authorized, issued and outstanding 96,844 — Common stock: Class A Voting, $ 1 par value, no maximum authorization, 1,030,780 shares outstanding 1,031 1,031 Class B Voting, $ 1 par value, no maximum authorization, 500,301 shares outstanding 500 500 Class C Non-Voting, $ 1 par value, no maximum authorization, 9,325,556 shares and 9,360,083 shares outstanding, respectively 9,326 9,360 Additional paid-in capital 139,370 135,894 Accumulated other comprehensive income/(loss), net of tax 13,382 ( 12,147 ) Retained earnings 1,047,347 943,239 Total Equity 1,718,949 1,489,026 Total Liabilities and Equity $ 35,370,157 $ 31,324,742 The accompanying notes are an integral part of these consolidated financial statements. 98 FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS For the Years Ended December 31, 2025 2024 2023 (in thousands, except per share amounts) Interest income: Investment securities and cash equivalents $ 846,441 $ 974,329 $ 877,394 Loans 765,806 629,187 514,894 Total interest income 1,612,247 1,603,516 1,392,288 Total interest expense 1,221,513 1,249,649 1,064,741 Net interest income 390,734 353,867 327,547 Provision for losses ( 32,860 ) ( 11,579 ) ( 858 ) Net interest income after provision for losses 357,874 342,288 326,689 Non-interest income/(expense): Guarantee and commitment fees 19,575 15,738 16,712 (Losses)/gains on financial derivatives ( 5,120 ) 2,636 2,882 Other income 3,183 2,827 3,917 Non-interest income 17,638 21,201 23,511 Operating expenses: Compensation and employee benefits 71,325 63,975 58,914 General and administrative 44,613 38,236 34,963 Regulatory fees 3,863 3,175 3,222 Operating expenses 119,801 105,386 97,099 Income before income taxes 255,711 258,103 253,101 Income tax expense 48,296 50,910 53,098 Net income 207,415 207,193 200,003 Preferred stock dividends ( 24,922 ) ( 25,146 ) ( 27,165 ) Loss on retirement of preferred stock — ( 1,619 ) — Net income attributable to common stockholders $ 182,493 $ 180,428 $ 172,838 Earnings per common share: Basic earnings per common share $ 16.73 $ 16.59 $ 15.97 Diluted earnings per common share $ 16.62 $ 16.44 $ 15.81 The accompanying notes are an integral part of these consolidated financial statements. 99 FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the Years Ended December 31, 2025 2024 2023 (in thousands) Net income $ 207,415 $ 207,193 $ 200,003 Other comprehensive income/(loss): Net unrealized gains on available-for-sale securities 51,123 39,078 59,640 Net changes in held-to-maturity securities ( 26 ) ( 636 ) ( 31,750 ) Net unrealized losses on cash flow hedges ( 18,781 ) ( 3,002 ) ( 14,348 ) Other comprehensive income before tax 32,316 35,440 13,542 Income tax expense related to other comprehensive income ( 6,787 ) ( 7,442 ) ( 2,844 ) Other comprehensive income net of tax 25,529 27,998 10,698 Comprehensive income $ 232,944 $ 235,191 $ 210,701 The accompanying notes are an integral part of these consolidated financial statements. 100 FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EQUITY Accumulated 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, 2022 19,980 $ 484,531 10,801 $ 10,801 $ 128,939 $ ( 50,843 ) $ 698,530 $ 1,271,958 Net income — — — — — — 200,003 200,003 Other comprehensive income, net of tax — — — — — 10,698 — 10,698 Cash dividends: Preferred stock — — — — — — ( 27,165 ) ( 27,165 ) Common stock (cash dividend of $ 1.10 per share) — — — — — — ( 47,652 ) ( 47,652 ) Issuance of Class C Common Stock — — 41 41 233 — — 274 Stock-based compensation cost — — — — 6,801 — — 6,801 Other stock-based award activity — — — — ( 3,054 ) — — ( 3,054 ) Balance as of December 31, 2023 19,980 $ 484,531 10,842 $ 10,842 $ 132,919 $ ( 40,145 ) $ 823,716 $ 1,411,863 Net income — — — — — — 207,193 207,193 Other comprehensive income, net of tax — — — — — 27,998 — 27,998 Cash dividends: Preferred stock — — — — — — ( 25,146 ) ( 25,146 ) Common stock (cash dividend of $ 1.40 per share) — — — — — — ( 60,905 ) ( 60,905 ) Redemption of Series C preferred stock ( 3,000 ) ( 73,382 ) — — — — — ( 73,382 ) Loss on retirement of preferred stock — — — — — — ( 1,619 ) ( 1,619 ) Issuance of Class C Common Stock — — 49 49 287 — — 336 Stock-based compensation cost — — — — 8,087 — — 8,087 Other stock-based award activity — — — — ( 5,399 ) — — ( 5,399 ) Balance as of December 31, 2024 16,980 $ 411,149 10,891 $ 10,891 $ 135,894 $ ( 12,147 ) $ 943,239 $ 1,489,026 Net income — — — — — — 207,415 207,415 Other comprehensive income, net of tax — — — — — 25,529 — 25,529 Cash dividends: Preferred stock — — — — — — ( 24,922 ) ( 24,922 ) Common stock (cash dividend of $ 1.50 per share) — — — — — — ( 65,439 ) ( 65,439 ) Issuance of Series H Preferred Stock 4,000 96,844 — — — — — 96,844 Issuance of Class C Common Stock — — 44 44 288 — — 332 Repurchase of Class C Common Stock — — ( 78 ) ( 78 ) — — ( 12,946 ) ( 13,024 ) Stock-based compensation cost — — — — 8,340 — — 8,340 Other stock-based award activity — — — — ( 5,152 ) — — ( 5,152 ) Balance as of December 31, 2025 20,980 $ 507,993 10,857 $ 10,857 $ 139,370 $ 13,382 $ 1,047,347 $ 1,718,949 The accompanying notes are an integral part of these consolidated financial statements. 101 FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2025 2024 2023 (in thousands) Cash flows from operating activities: Net income $ 207,415 $ 207,193 $ 200,003 Adjustments to reconcile net income to net cash provided by operating activities: Net amortization of deferred gains, premiums, and discounts on loans, investments, Farmer Mac Guaranteed Securities, and USDA Securities ( 21,545 ) ( 23,879 ) ( 17,025 ) Net amortization of debt premiums, discounts, and issuance costs 23,278 21,242 31,421 Net change in fair value of hedged items, financial derivatives, loans held sale, and trading securities ( 165,736 ) 214,319 78,249 Total provision for allowance for losses 32,913 11,490 1,136 Stock-based compensation expense 8,340 8,088 6,801 Proceeds from repayment of loans purchased as held for sale 40,266 29,216 24,378 Purchases of tax credits ( 61,459 ) ( 29,186 ) — Other ( 5,803 ) 410 7,213 Net change in: Interest receivable ( 59,127 ) ( 31,885 ) ( 63,944 ) Guarantee and commitment fees receivable ( 271 ) 96 ( 1,700 ) Other assets 105,739 47,776 54,369 Accrued interest payable 38,601 13,272 63,954 Custodial deposit liability ( 97,244 ) 130,643 ( 10,778 ) Other liabilities 34,695 13,851 1,721 Net cash provided by operating activities 80,062 612,646 375,798 Cash flows from investing activities: Purchases of equipment and leasehold improvements — ( 5,272 ) — Purchases of available-for-sale investment securities ( 3,744,720 ) ( 3,109,301 ) ( 3,649,087 ) Purchases of held-to-maturity investment securities ( 354,413 ) ( 922,743 ) ( 2,377,904 ) Purchases of other investment securities ( 4,420 ) ( 3,293 ) ( 3,145 ) Purchases of loans held for investment ( 5,345,105 ) ( 3,870,628 ) ( 2,164,053 ) Purchases of defaulted loans ( 2,544 ) ( 4,447 ) — Proceeds from repayment of available-for-sale investment securities 1,865,144 1,951,127 2,958,508 Proceeds from repayment of held-to-maturity investment securities 1,497,209 2,445,086 1,916,712 Proceeds from repayment of loans purchased as held for investment 2,249,450 1,655,784 1,363,588 Proceeds from sale of real estate owned 1,045 — — Proceeds from sale of available-for-sale investment securities 19,537 115,247 — Proceeds from sale of loans previously classified as held for investment 6,045 5,775 — Proceeds from sale of Farmer Mac Guaranteed Securities — 60,192 — Net cash used in investing activities ( 3,812,772 ) ( 1,682,473 ) ( 1,955,381 ) Cash flows from financing activities: Proceeds from issuance of notes payable 90,081,802 68,283,121 57,565,783 Proceeds from issuance of debt securities of consolidated trusts 592,777 588,250 222,188 Payments to redeem notes payable ( 86,798,052 ) ( 67,361,321 ) ( 56,001,041 ) Payments to third parties on debt securities of consolidated trusts ( 226,843 ) ( 138,807 ) ( 102,045 ) Purchases of common stock ( 12,894 ) — — Proceeds from common stock issuance 288 287 233 Proceeds from preferred stock issuance, net of stock issuance costs 96,844 — — Tax payments related to share-based awards ( 5,109 ) ( 5,351 ) ( 3,013 ) Retirement of preferred stock — ( 75,000 ) — Dividends paid on common and preferred stock ( 89,043 ) ( 86,052 ) ( 74,817 ) Net cash provided by financing activities 3,639,770 1,205,127 1,607,288 Net change in cash and cash equivalents ( 92,940 ) 135,300 27,705 Cash, cash equivalents, and restricted cash at beginning of period 1,024,007 888,707 861,002 Cash, cash equivalents, and restricted cash at end of period $ 931,067 $ 1,024,007 $ 888,707 Cash paid during the period for: Interest 910,556 819,959 582,960 Federal income taxes — 39,200 48,000 Non-cash activity: Loans securitized as Farmer Mac Guaranteed Securities 48,067 109,546 36,497 Loans held for investment transferred to consolidated trusts 611,615 624,097 281,027 The accompanying notes are an integral part of these consolidated financial statements. 102 FEDERAL AGRICULTURAL MORTGAGE CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. ORGANIZATION The Federal Agricultural Mortgage Corporation ("Farmer Mac") is a stockholder-owned, federally chartered instrumentality of the United States established under Title VIII of the Farm Credit Act of 1971, as amended (12 U.S.C. §§ 2279aa et seq.), which is sometimes referred to as Farmer Mac's Charter. Farmer Mac was originally created by the United States Congress to provide a secondary market for a variety of loans made to borrowers in rural America. This secondary market is designed to increase the accessibility of finance at stable interest rates to America's rural communities and to provide rural borrowers with the benefits of capital markets pricing and product innovation. Farmer Mac's secondary market activities include: • purchasing eligible loans directly from lenders, including participation interests, syndicated notes, revolving and non-revolving credit facilities, and unfunded loan commitments. "Eligible Loans" include obligations which are: secured by a first lien mortgage on real estate used in agricultural production or processing, including part-time farms and rural housing loans; agricultural and rural development loans guaranteed by the United States Department of Agriculture ("USDA"); and loans by lenders organized as cooperatives to finance electrification and telecommunications facilities, including broadband and middle mile broadband infrastructure, and renewable energy projects in rural areas; • guaranteeing and purchasing securities issued by lenders and other financial institutions that obtain funding by pledging pools of Eligible Loans that they retain (Farmer Mac refers to these securities as "AgVantage," one of our registered trademarks); • issuing and guaranteeing securities that represent interests in, or obligations secured by, pools of Eligible Loans that we purchase and transfer to trusts (together with AgVantage, Farmer Mac refers to these securities as "Farmer Mac Guaranteed Securities," which may be retained by the seller of the underlying loans, retained by Farmer Mac, or sold to third-party investors); • servicing (including as master servicer) Eligible Loans, including those we purchase, securitize, or service on behalf of third-parties; and • providing long-term standby purchase commitments ("LTSPCs") for Eligible Loans. Farmer Mac conducts its secondary market activities through two lines of business — Agricultural Finance and Infrastructure Finance. For more information about those lines of business and the segments within them, see Note 12—Business Segments. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting and reporting policies of Farmer Mac conform with accounting principles generally accepted in the United States of America ("generally accepted accounting principles" or "GAAP"). The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The following are the significant accounting policies that Farmer Mac follows in preparing and presenting its consolidated financial statements: 103 (a) Principles of Consolidation The consolidated financial statements include the accounts of Farmer Mac and its two subsidiaries during the year: (1) Farmer Mac Mortgage Securities Corporation, whose principal activities are to facilitate the purchase and issuance of Farmer Mac Guaranteed Securities; and (2) Farmer Mac II LLC, which operated substantially all of the business related to the USDA Securities included in the Agricultural Finance line of business from 2010 through 2023 and continues to hold a "run-off" portfolio of USDA Securities. The consolidated financial statements also include the accounts of Variable Interest Entities ("VIEs") in which Farmer Mac determined itself to be the primary beneficiary. (b) Cash, Cash Equivalents and Restricted Cash Farmer Mac considers cash on hand and highly liquid investment securities with maturities at the time of purchase of three months or less to be cash equivalents. Cash that is legally restricted from use by Farmer Mac for its discretionary purposes, or for general corporate use, is classified as restricted cash. (c) Investment Securities Securities for which Farmer Mac has the intent and ability to hold to maturity are classified as held-to-maturity and are carried at amortized cost. Securities for which Farmer Mac does not have the positive intent and ability to hold to maturity are classified as available-for-sale or trading and are carried at estimated fair value. Unrealized gains and losses on available-for-sale securities are reported as a component of accumulated other comprehensive income in stockholders' equity. For securities classified as trading, unrealized gains and losses are included in earnings. Gains and losses on the sale of available-for-sale and trading securities are determined using the specific identification cost method. Premiums, discounts, and other deferred costs are amortized to interest income using the effective interest method. See Note 2(m)—Fair Value Measurements for more information on the accounting policy related to fair value measurement. (d) Loans Loans for which Farmer Mac has the positive intent and ability to hold for the foreseeable future are classified as held for investment and reported at their unpaid principal balance, net of unamortized purchase discounts or premiums. Loans for which Farmer Mac has made a decision to sell the loan are classified as held for sale and reported at the lower of cost or fair value determined on a pooled basis. Farmer Mac de-recognizes sold loans, and recognizes any associated gain or loss, when they have been legally isolated from Farmer Mac, the buyer has the right to pledge or exchange them, and Farmer Mac does not maintain effective control over them. When Farmer Mac consolidates a trust, it recognizes the loans underlying the trust in the consolidated balance sheets as "Loans held for investment in consolidated trusts, at amortized cost." See Note 2(n)—Consolidation of Variable Interest Entities for more information on the accounting policy related to consolidation. 104 Non-accrual Loans Non-accrual loans are loans for which it is probable that Farmer Mac will be unable to collect all amounts due according to the contractual terms of the loan agreement and generally includes loans 90 days or more past due. In addition, certain loans may be placed on non-accrual status even if they are not yet 90 days delinquent when emerging credit deterioration, borrower financial stress, or other adverse information indicates that full collection of contractual principal and interest is no longer probable. When a loan is placed on non-accrual, interest accrual on the loan is discontinued and interest previously accrued is reversed against interest income in the current period. While on non-accrual status, interest is recognized under either the cash basis method or the cost recovery method, depending on the circumstances. Under the cash basis method, interest income is recognized only as payments are received in cash. Under the cost recovery method, all cash receipts are applied first to reduce the recorded investment in the loan, and interest income is not recognized until the loan balance has been fully recovered.. Loans are returned to accrual status when all the principal and interest payments contractually due are collected and certain performance criteria are met. (e) Transfers of Financial Assets Farmer Mac accounts for transfers of financial assets as sales when it has surrendered control over the related assets. Whether control has been relinquished requires, among other things, an evaluation of relevant legal considerations and an assessment of the nature and extent of Farmer Mac's continuing involvement with the assets transferred. Gains and losses stemming from transfers reported as sales are included in the accompanying consolidated statements of operations when incurred. Assets obtained and liabilities incurred in connection with transfers reported as sales are initially recognized in the consolidated balance sheets at fair value. (f) Financial Derivatives Farmer Mac enters into financial derivative transactions principally 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, not for trading or speculative purposes. Farmer Mac enters into interest rate swap contracts to adjust the characteristics of its short-term debt to match more closely the cash flow and duration characteristics of its longer-term loans and other assets, and also to adjust the characteristics of its long-term debt to match more closely the cash flow and duration characteristics of its short-term assets, thereby reducing interest rate risk and, often times, deriving an overall lower effective cost of borrowing than would otherwise be available to Farmer Mac . Accounting for financial derivatives differs depending on whether a derivative is designated in a hedge accounting relationship. Derivative instruments designated in fair value hedge accounting relationships mitigate exposure to changes in the fair value of assets or liabilities. Derivative instruments designated in cash flow hedge accounting relationships mitigate exposure to the variability in expected future cash flows or other forecasted transactions. In order to qualify for fair value or cash flow hedge accounting treatment, documentation must indicate the intention to designate the derivative as a hedge of a specific asset, or liability, or a future cash flow. Effectiveness of the hedge is assessed before the end of the quarter of inception and monitored over the life of the hedging relationship. Changes in the fair value of financial derivatives not designated as cash flow or fair value hedges are reported in "(Losses)/gains on financial derivatives" in the consolidated statements of operations. For 105 financial derivatives designated in fair value hedge accounting relationships, changes in the fair value of the designated portion of the derivative hedging instrument (i.e., interest-rate swap) and related interest accruals are reported in the same interest income or expense line item in the consolidated statements of operations as the hedged item. For financial derivatives designated in cash flow hedge relationships, the unrealized gain or loss on the derivative is recorded in other comprehensive income. Because the hedging instrument is an interest rate swap and the hedged forecasted transactions are future interest payments on variable rate debt, amounts recorded in accumulated other comprehensive income are reclassified to "Total interest expense" in conjunction with the recognition of interest expense on the hedged debt. Collateralized Agreements and Offsetting Arrangements Over-the-Counter Derivatives Farmer Mac uses master netting and collateral agreements to reduce our credit risk exposure to our over-the-counter derivative ("OTC") counterparties for interest-rate swap derivatives. Master netting agreements provide for the netting of amounts receivable and payable from an individual counterparty, as well as posting of collateral in the form of cash depending on which party is in a liability position. Farmer Mac has master netting agreements in place with all of our OTC derivative counterparties. The market value of each counterparty's derivatives outstanding is calculated to determine the amount of our net credit exposure, which is equal to the market value of derivatives in net gain position by counterparty after giving consideration to collateral posted. In the event a counterparty defaults on its obligation under the derivatives agreement and the default is not remedied in the manner prescribed by the agreement, Farmer Mac has a right under the agreement to sell the collateral. As a result, Farmer Mac's use of master netting and collateral agreements reduce our exposure to our counterparties in the event of default. Cleared Derivatives The majority of Farmer Mac's interest-rate swaps are subject to the central clearing requirement. Changes in the value of cleared derivatives are settled daily via payments made through the clearinghouse. Farmer Mac nets the exposure by clearinghouse and clearing member. (g) Notes Payable Debt issuance costs and premiums and discounts are deferred and amortized to interest expense using the effective interest method over the contractual life of the related debt. (h) Allowance for Losses and Reserve for Losses Farmer Mac maintains an allowance for credit losses to cover current expected credit losses as of the balance sheet date for on-balance sheet investment securities and loans held for investment (collectively referred to as "allowance for losses"). Farmer Mac also maintains a reserve for credit losses to cover current expected credit losses as of the balance sheet date for off-balance sheet loans underlying LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities (collectively referred to as "reserve for losses"). Both the allowance for losses and reserve for losses are based on historical information and reasonable and supportable forecasts. See Note 2(l)—Guarantees for more information on the accounting policy related to LTSPCs and off-balance sheet Farmer Mac Guaranteed Securities. 106 The allowance for losses increases through periodic provisions for loan losses that are charged against net interest income and the reserve for losses increases through provisions for losses that are charged to non-interest expense. Both the allowance for losses and reserve for losses are decreased by charge-offs for realized losses, net of recoveries. Releases from the allowance for losses or reserve for losses occur when the estimate of expected credit losses as of the end of a period is less than the estimate at the beginning of the period. The total allowance for losses consists of the allowance for losses and the reserve for losses. Charge-offs Farmer Mac records a charge-off from the allowance for losses when either a) a loan, or a portion of a loan, is deemed uncollectible; or b) a loss has been confirmed through the receipt of assets, generally the underlying collateral, in full satisfaction of the loan. The charge-off equals the excess of the recorded investment in the loan over the fair value of the collateral less estimated selling costs. Estimation Methodology Farmer Mac bases its methodology for determining its current estimate of expected losses on a statistical model, which incorporates credit loss history and reasonable and supportable forecasts. Farmer Mac's estimation methodology includes the following key components: • An economic model for each portfolio, including Agricultural Finance loans (Corporate AgFinance and Farm & Ranch), Infrastructure Finance loans (Power & Utilities, Broadband Infrastructure, and Renewable Energy), and AgVantage securities; • A migration matrix for each portfolio that reasonably predicts the movement of each financial asset among various risk categories over the course of each asset's expected life (the migration matrix forms the basis for our estimate of the probability of default of each financial asset); • A loss-given-default ("LGD") model that reasonably predicts the amount of loss that Farmer Mac would incur upon the default of each financial asset; • An economic factor forecast that updates the migration matrix model and the LGD model with current assumptions for the economic indicators that Farmer Mac has determined are most correlated with or relevant to the performance of each portfolio of assets (including Gross Domestic Product ("GDP"), credit spreads, unemployment rates, land values, and commodity prices); and • A discounted cash flow analysis, which relies upon each of the above model outputs, plus the contractual terms of each financial asset, and the effective interest rate of each financial asset. Management evaluates these assumptions by considering many relevant factors, including: • economic conditions; • geographic and agricultural commodity/product concentrations in the portfolio; • the credit profile of the portfolio, including risk ratings and financial metrics; • delinquency trends of the portfolio; • historical charge-off and recovery activities of the portfolio; and • other factors to capture current portfolio trends and characteristics that differ from historical experience. When a borrower is either in foreclosure or is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral by Farmer Mac the loan is 107 considered to be a collateral dependent asset ("CDA"). The current expected credit loss for CDA loans is calculated as the difference between the amortized cost basis of the loan and the estimated collateral value as of the reporting date, less costs to sell. Subsequent changes in the estimated collateral value are recognized in the provision for credit losses. Management believes that its methodology produces a reasonable estimate of expected credit losses, as of the balance sheet date, for the expected life of all of its financial assets. Allowance for Loss on Available-for-Sale (AFS) Securities To measure current expected credit losses on impaired AFS securities, Farmer Mac first considers those impaired securities that: 1) Farmer Mac does not intend to sell, and 2) it is not more likely than not that Farmer Mac will be required to sell before recovering its amortized cost basis. In assessing whether a credit loss exists, Farmer Mac compares the present value, discounted at the security's effective interest rate, of cash flows expected to be collected from an impaired AFS debt security to its amortized cost basis. If the present value of cash flows expected to be collected is less than the amortized cost basis of the impaired security, a credit loss exists and Farmer Mac records an allowance for loss for that credit loss. However, the amount of that allowance is limited by the amount that the security’s fair value is less than its amortized cost basis. Accrued interest receivable is recorded separately on the Consolidated Balance Sheet, and the allowance for credit losses excludes uncollectible accrued interest receivable. (i) Earnings Per Common Share Basic earnings per common share ("EPS") is based on the daily weighted-average number of shares of common stock outstanding. 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 unit awards. The following schedule reconciles basic and diluted EPS for the years ended December 31, 2025, 2024, and 2023: Table 2.1 For the Years Ended December 31, 2025 2024 2023 Net Income Weighted-Average Shares $ per Share Net Income Weighted-Average Shares $ per Share Net Income Weighted-Average Shares $ per Share (in thousands, except per share amounts) Basic EPS Net income attributable to common stockholders $ 182,493 10,911 $ 16.73 $ 180,428 10,874 $ 16.59 $ 172,838 10,829 $ 15.97 Effect of dilutive securities (1) SARs and restricted stock units — 72 ( 0.11 ) — 101 ( 0.15 ) — 108 ( 0.16 ) Diluted EPS $ 182,493 10,983 $ 16.62 $ 180,428 10,975 $ 16.44 $ 172,838 10,937 $ 15.81 (1) For the years ended December 31, 2025, 2024, and 2023, average SARs and restricted stock units of 47,629 , 30,891 , and 32,683 respectively, were outstanding but not included in the computation of diluted earnings per share of common stock because they were anti-dilutive. For the years ended December 31, 2025, 2024, and 2023, contingent shares of unvested restricted stock units of 23,630 , 28,670 , and 30,648 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. 108 (j) Income Taxes Deferred federal income tax assets and liabilities are established for temporary differences between financial and taxable income and are measured using the current enacted statutory tax rate. Income tax expense is equal to the income taxes payable in the current year plus the net change in the deferred tax asset or liability balance. Deferred tax assets are measured at rates enacted for the periods in which they are expected to be realized. To the extent rates change, the deferred tax asset will be adjusted to reflect the new rate. An increase in corporate tax rates would result in an increase in the value of the deferred tax asset. Farmer Mac evaluates its tax positions quarterly to identify and recognize any liabilities related to uncertain tax positions in its federal income tax returns. Farmer Mac uses a two-step approach in which income tax benefits are recognized if, based on the technical merits of a tax position, it is more likely than not (a probability of greater than 50%) that the tax position would be sustained upon examination by the taxing authority, which includes all related appeals and litigation process. The amount of tax benefit recognized is then measured at the largest amount of tax benefit that is greater than 50% likely to be realized upon settlement with the taxing authority, considering all information available at the reporting date. Farmer Mac's policy for recording interest and penalties associated with uncertain tax positions is to record them as a component of income tax expense. Farmer Mac establishes a valuation allowance for deferred tax assets if it is more likely than not that some portion or all of the deferred tax assets will not be realized. In determining its deferred tax asset valuation allowance, Farmer Mac considered its taxable income of the appropriate character (for example, ordinary income or capital gain) within the carryback and carryforward periods available under the tax law and the impact of possible tax planning strategies. (k) 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. 109 The following table presents the changes in accumulated other comprehensive income ("AOCI"), net of tax, by component for the years ended December 31, 2025, 2024, and 2023. Table 2.2 Available-for-Sale Securities Held-to-Maturity Securities Cash Flow Hedges Total (in thousands) Balance as of January 1, 2023 $ ( 115,561 ) $ 16,357 $ 48,361 $ ( 50,843 ) Other comprehensive income/(loss) before reclassifications 47,114 ( 25,199 ) 4,973 26,888 Amounts reclassified from AOCI — 118 ( 16,308 ) ( 16,190 ) Net comprehensive income/(loss) 47,114 ( 25,081 ) ( 11,335 ) 10,698 Balance as of December 31, 2023 $ ( 68,447 ) $ ( 8,724 ) $ 37,026 $ ( 40,145 ) Other comprehensive income/(loss) before reclassifications 31,715 — 13,947 45,662 Amounts reclassified from AOCI ( 843 ) ( 502 ) ( 16,319 ) ( 17,664 ) Net comprehensive income/(loss) 30,872 ( 502 ) ( 2,372 ) 27,998 Balance as of December 31, 2024 $ ( 37,575 ) $ ( 9,226 ) $ 34,654 $ ( 12,147 ) Other comprehensive income/(loss) before reclassifications 40,266 — ( 3,666 ) 36,600 Amounts reclassified from AOCI 120 ( 20 ) ( 11,171 ) ( 11,071 ) Net comprehensive income/(loss) 40,386 ( 20 ) ( 14,837 ) 25,529 Balance as of December 31, 2025 $ 2,811 $ ( 9,246 ) $ 19,817 $ 13,382 110 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 years ended December 31, 2025, 2024, and 2023: Table 2.3 For the Years Ended December 31, 2025 2024 2023 Before Tax Provision (Benefit) After Tax Before Tax Provision (Benefit) After Tax Before Tax Provision (Benefit) After Tax (in thousands) Other comprehensive income: Available-for-sale-securities: Unrealized holding gains on available-for-sale securities $ 50,971 $ 10,705 $ 40,266 $ 40,145 $ 8,430 $ 31,715 $ 59,640 $ 12,526 $ 47,114 Less reclassification adjustments included in: Losses/(gains) on sale of available-for-sale investment securities (1) 163 34 129 ( 1,052 ) ( 221 ) ( 831 ) — — — Other income (2) ( 11 ) ( 2 ) ( 9 ) ( 15 ) ( 3 ) ( 12 ) — — — Total $ 51,123 $ 10,737 $ 40,386 $ 39,078 $ 8,206 $ 30,872 $ 59,640 $ 12,526 $ 47,114 Held-to-maturity securities: Change in fair value (3) $ — $ — $ — $ — $ — $ — $ ( 31,898 ) $ ( 6,699 ) $ ( 25,199 ) Less reclassification adjustments included in: Net interest income (4) ( 26 ) ( 6 ) ( 20 ) ( 636 ) ( 134 ) ( 502 ) 148 30 118 Total $ ( 26 ) $ ( 6 ) $ ( 20 ) $ ( 636 ) $ ( 134 ) $ ( 502 ) $ ( 31,750 ) $ ( 6,669 ) $ ( 25,081 ) Cash flow hedges Unrealized (losses)/gains on cash flow hedges $ ( 4,641 ) $ ( 975 ) $ ( 3,666 ) $ 17,655 $ 3,708 $ 13,947 $ 6,295 $ 1,322 $ 4,973 Less reclassification adjustments included in: Net interest income (5) ( 14,140 ) ( 2,969 ) ( 11,171 ) ( 20,657 ) ( 4,338 ) ( 16,319 ) ( 20,643 ) ( 4,335 ) ( 16,308 ) Total $ ( 18,781 ) $ ( 3,944 ) $ ( 14,837 ) $ ( 3,002 ) $ ( 630 ) $ ( 2,372 ) $ ( 14,348 ) $ ( 3,013 ) $ ( 11,335 ) Other comprehensive income $ 32,316 $ 6,787 $ 25,529 $ 35,440 $ 7,442 $ 27,998 $ 13,542 $ 2,844 $ 10,698 (1) 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. (3) Represents the accumulated unrealized loss on the AgVantage Securities transferred from available-for-sale to held-to-maturity. (4) Represents amortization of unrealized gain/loss reported in AOCI prior to the reclassification of certain securities from available-for-sale to held-to-maturity, which occurred at fair value. (5) Relates to the recognition of unrealized gains and losses on cash flow hedges recorded in AOCI. (l) Guarantees LTSPCs and securitization trusts where Farmer Mac is not the primary beneficiary result in the creation of guarantee obligations for Farmer Mac. Farmer Mac records, at the inception of a guarantee or LTSPC, a liability for the fair value of its obligation to stand ready to perform under the terms of each guarantee or LTSPC and an asset that is equal to the fair value of the fees that will be received over the life of each guarantee or LTSPC. The fair values of the guarantee obligation and asset at inception are based on the present value of expected cash flows using management's best estimate of certain key assumptions, which include prepayment speeds, forward yield curves, and discount rates commensurate with the risks involved. Because the cash flows of these instruments may be interest rate path dependent, these values 111 and projected discount rates are derived using a Monte Carlo simulation model. The guarantee obligation and corresponding asset are later amortized into guarantee and commitment fee income in relation to the decrease in the unpaid principal balance on the underlying Agricultural Finance real estate mortgage loans and Infrastructure Finance loans. (m) Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, Farmer Mac uses various valuation approaches, including market and income based approaches. When available, the fair value of Farmer Mac's financial instruments is based on quoted market prices, valuation techniques that use observable market-based inputs, or unobservable inputs that are corroborated by market data. Pricing information obtained from third parties is internally validated for reasonableness before use in the consolidated financial statements. Fair value measurements related to financial instruments that are reported at fair value in the consolidated financial statements each period are referred to as recurring fair value measurements. Fair value measurements related to financial instruments that are not reported at fair value each period but are subject to fair value adjustments in certain circumstances are referred to as nonrecurring fair value measurements. Fair Value Classification and Transfers The fair value hierarchy ranks the quality and reliability of the information used to determine fair values. The hierarchy gives highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The following three levels are used to classify fair value measurements: Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2 Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly. Level 3 Prices or valuations that require unobservable inputs that are significant to the fair value measurement. Farmer Mac performs a detailed analysis of the assets and liabilities carried at fair value to determine the appropriate level based on the transparency of the inputs used in the valuation techniques. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an instrument's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Farmer Mac's assessment of the significance of a particular input to the fair value measurement of an instrument requires judgment and consideration of factors specific to the instrument. While Farmer Mac believes its valuation methods are appropriate and consistent with those of other market participants, using different methodologies or assumptions to determine fair value could result in a materially different estimate of fair value for some financial instruments. The following is a description of the fair value techniques used for instruments measured at fair value as well as the general classification of those instruments under the valuation hierarchy described above. 112 Recurring Fair Value Measurements and Classification Available-for-Sale and Trading Investment Securities The fair value of investments in U.S. Treasuries is based on unadjusted quoted prices for identical securities in active markets. Farmer Mac classifies these fair value measurements as "Level 1." For a significant portion of Farmer Mac's investment portfolio, including most asset-backed securities, senior agency debt securities, and Government or government-sponsored enterprise ("GSE") guaranteed mortgage-backed securities, fair value is primarily determined using a reputable and nationally recognized third-party pricing service. The prices obtained are non-binding and generally representative of recent market trades on similar securities. The fair value of certain asset-backed and Government guaranteed mortgage-backed securities are estimated based on quotations from brokers or dealers. Farmer Mac corroborates its primary valuation source by obtaining a secondary price from another independent third-party pricing service. Farmer Mac classifies these fair value measurements as "Level 2." For certain investment securities that are thinly traded or not quoted, Farmer Mac estimates fair value using internally-developed models that employ a discounted cash flow approach. Farmer Mac maximizes the use of observable market data, including prices of financial instruments with similar maturities and characteristics, interest rate yield curves, measures of volatility, and prepayment rates. Farmer Mac generally considers a market to be thinly traded or not quoted if the following conditions exist: (1) there are few transactions for the financial instruments; (2) the prices in the market are not current; (3) the price quotes vary significantly either over time or among independent pricing services or dealers; or (4) there is limited availability of public market information. Farmer Mac classifies these fair value measurements as "Level 3" because there is limited market activity and therefore require the use of significant unobservable inputs in estimating the fair value. Financial Derivatives The fair value of exchange-traded U.S. Treasury futures is based on unadjusted quoted prices for identical financial instruments. Farmer Mac classifies these fair value measurements as Level 1. Farmer Mac's derivative portfolio consists primarily of interest rate swaps and forward sales contracts on the debt of other GSEs. Farmer Mac estimates the fair value of these financial instruments primarily based upon a third-party accounting and valuation system. The third-party accounting and valuation system determines the fair value of the interest rate swaps using the market standard methodology of netting the discounted future fixed cash payments (or receipts) and the discounted expected variable cash receipts (or payments). Farmer Mac also incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements of its derivatives. The credit valuation adjustments associated with Farmer Mac’s derivatives utilize model-derived credit spreads, which are Level 3 inputs. As of December 31, 2025, Farmer Mac has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of these interest rate contracts and has determined that the credit valuation adjustments were not significant to the overall valuation of its derivative portfolio. As a result, Farmer Mac classifies these derivative instruments as Level 2 due to the observable nature of the significant inputs utilized. 113 Farmer Mac also internally values its derivative portfolio using a discounted cash flow valuation technique and obtains counterparty valuations to corroborate management's estimate of fair value, which is based upon a third-party accounting and valuation system. (n) Consolidation of Variable Interest Entities Farmer Mac has interests in various entities that are considered to be VIEs. These interests include investments in securities issued by VIEs, such as Farmer Mac agricultural mortgage-backed securities created pursuant to Farmer Mac's securitization transactions and mortgage- and asset-backed trusts that Farmer Mac did not create. The consolidation model uses a qualitative evaluation that requires consolidation of an entity when the reporting enterprise both: (1) has the power to direct matters which significantly impact the activities and success of the entity, and (2) has exposure to benefits and/or losses that could potentially be significant to the entity. The reporting enterprise that meets both these conditions is deemed the primary beneficiary of the VIE. Upon consolidation of a VIE, Farmer Mac accounts for the incremental assets and liabilities initially at their carrying amounts. The VIEs in which Farmer Mac has a variable interest are limited to securitization trusts. Given the interests Farmer Mac holds, the major factor in determining if Farmer Mac is the primary beneficiary is whether Farmer Mac has the power to direct the activities of the trust that potentially have the most significant impact on the economic performance of the trust. Generally, the ability to make decisions regarding default mitigation is evidence of that power. Farmer Mac determined that it is the primary beneficiary for the securitization trusts related to most Agricultural Finance securitization transactions because of its ability to control the default mitigation activities of the trusts through its role as master servicer. For those trusts where Farmer Mac is the primary beneficiary, the assets and liabilities are presented on the consolidated balance sheets as "Loans held for investment in consolidated trusts, at amortized cost" and "Debt securities of consolidated trusts held by third parties," respectively. The assets can only be used to satisfy the obligations of the related trust. For those trusts in which Farmer Mac has a variable interest but is not the primary beneficiary, Farmer Mac's interests are presented as "Investment securities" on the consolidated balance sheets. Farmer Mac's involvement in VIEs include securitization trusts under the Agricultural Finance line of business. In the case of USDA guaranteed trusts, Farmer Mac is not determined to be the primary beneficiary because it does not have the decision-making power over default mitigation activities. Based on the USDA's program authority over the servicing and default mitigation activities of the USDA guaranteed portions of loans, Farmer Mac believes that the USDA has the power to direct the activities that most significantly impact the trust's economic performance. Farmer Mac does not have exposure to losses that could be significant to the trust and there are no triggers that would result in Farmer Mac superseding the USDA's authority with regard to directing the activities of the trust. The following table provides a summary of unconsolidated VIEs with which Farmer Mac has significant continuing involvement but is not the primary beneficiary. The balances presented in the table below excludes certain transactions with unconsolidated VIEs where Farmer Mac's continuing involvement is insignificant. Farmer Mac considers continuing involvement to be insignificant when it relates to a VIE 114 where Farmer Mac only invests in securities issued by the VIE and where Farmer Mac was not involved in the design of the VIE or where no transfers have occurred between Farmer Mac and the VIE. Table 2.4 Unconsolidated Variable Interest Entities As of December 31, 2025 As of December 31, 2024 (in thousands) On-Balance Sheet: Farmer Mac Guaranteed Securities: Carrying value 80,570 59,317 Maximum exposure to loss (1) 80,384 58,985 Off-Balance Sheet: Farmer Mac Guaranteed Securities: Maximum exposure to loss (1)(2)(3) 386,057 426,310 (1) Farmer Mac uses the guaranteed portion of unpaid principal balance and outstanding face amount of investment securities to represent maximum exposure to loss. (2) The amount relates to unconsolidated trusts where Farmer Mac is not the primary beneficiary, either due to shared power with an unrelated party or a subordinate class majority holder has the unilateral right to remove Farmer Mac as Master Servicer without cause. (3) Farmer Mac presents a liability for its obligation to stand ready under its guarantee in "Guarantee and commitment obligation" on the Consolidated Balance Sheets, which was $ 5.0 million and $ 5.6 million as of December 31, 2025 and 2024, respectively. The weighted average remaining maturity of the loans underlying the guarantee was 20.7 years and 21.2 years as of December 31, 2025 and 2024, respectively. (o) Custodial Deposit Liability Farmer Mac, as a servicer, collects cash from borrowers in advance of the borrower's contractual payment date. Under the terms of Farmer Mac's servicing agreement, the cash is not applied to the loan until the contractual payment due date. As such, Farmer Mac's policy is to include the cash in the consolidated balance sheet as "Cash and cash equivalents" with an offsetting liability to "Accounts payable and accrued expenses" until the payment is contractually due, at which point the payment is applied to the loan. The net change in the amount of this custodial cash will also be disclosed in the consolidated statements of cash flows as "Custodial deposit liability." The balance of this liability was $ 59.9 million and $ 157.1 million as of December 31, 2025 and 2024, respectively. (p) Business Segments During fourth quarter 2024, Farmer Mac's Chief Operating Decision Maker ("CODM") – its Chief Executive Officer – began to be provided with financial information of an additional operating segment, "Broadband Infrastructure." Prior to fourth quarter 2024, the financial information of the Broadband Infrastructure segment had been included within the Rural Utilities segment, which was renamed as "Power & Utilities" in fourth quarter 2024. The CODM reviews segment core earnings to make decisions about allocating resources and to assess the financial performance of the segments. Prior to fourth quarter 2024, the reportable segments were: Farm & Ranch, Corporate AgFinance, Rural Utilities, Renewable Energy, Funding, Investments, and Corporate. Beginning in fourth quarter 2024, the reportable segments are: Farm & Ranch, Corporate AgFinance, Power & Utilities, Broadband Infrastructure, Renewable Energy, Funding, and Investments. The purpose of separately reporting the financial results of the Broadband Infrastructure segment is for the CODM to separately review and analyze its financial 115 performance according to this type of customer and market because it is meaningfully distinct from the Power & Utilities customer and market. Prior to 2024, all operating expenses were allocated to a Corporate segment. Beginning in fourth quarter 2024, operating expenses that are directly attributable to the operating segments are allocated to each respective segment. The remaining operating expenses that are not directly attributable to operating segments are unallocated and reported as a reconciling adjustment between total segment results and consolidated net income. For the years ended December 31, 2024 and 2023, Farmer Mac has recast its segment results to reflect these changes. (q) New Accounting Standards Recently Adopted Accounting Guidance Standard Description Date of Adoption Effect on Consolidated Financial Statements ASU 2023-09 , Income Taxes (Topic 740): Improvements to Income Tax Disclosures The Update provides guidance on improvements to annual income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. Additionally, public entities must provide a separate disclosure for any reconciling item that meets a quantitative threshold. January 1, 2025 Farmer Mac adopted the new standard on a retrospective basis. The adoption of this Update did not have a material impact on Farmer Mac's financial position, results of operations, or cash flows. See Note 9 to the financial statements. 116 Recently Issued Accounting Guidance, Not Yet Adopted Within Our Consolidated Financial Statements Farmer Mac is still assessing the impact of the new accounting standards in the table below but does not expect that adoption of the new guidance will have a material impact on Farmer Mac's financial position, results of operations, or cash flows. Standard Description ASU 2024-03 , Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. ASU 2025-06 , Intangibles - Goodwill and Other - Internal-use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software The Update amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. It removes all references to "development stages" and establishes new criteria to be met for the entity to begin capitalizing software costs. New guidance is then given for how to evaluate whether the probable-to-complete recognition threshold has been met. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, with early adoption permitted. ASU 2025-08 , Financial Instruments - Credit Losses (Topic 326): Purchased Loans This Update expands the scope of the "gross-up" approach from applicable only to purchased credit-deteriorated ("PCD") assets to include financial assets acquired without credit deterioration and deemed "seasoned." Non-PCD loans are seasoned if they were purchased at least 90 days after origination and the acquirer was not involved in the origination of the loans. Under this model, an allowance for expected credit losses is recognized at acquisition, offsetting the loan's amortized cost basis, thereby eliminating the day-one credit-loss expense previously required for non-PCD assets. ASU 2025-08 is effective for annual periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods, with early adoption permitted. ASU 2025-09 , Derivatives and Hedging (Topic 815): Hedge Accounting Improvements ASU 2025-09 amends ASC 815 to align hedge accounting more closely with the economics of an entity's risk management practices. Among other things, key amendments include: similar risk assessment for cash flow hedges, hedging interest payments on choose-your-rate debt, cash flow hedges of nonfinancial forecasted transactions, and net written options as hedging instruments. ASU 2025-09 is effective for annual periods beginning after December 15, 2026, and interim periods within those annual reporting periods, with early adoption permitted. ASU 2025-11 , Interim Reporting (Topic 270): Narrow-Scope Improvements This Update clarifies interim disclosure requirements, including providing a comprehensive list of interim disclosure requirements under U.S. GAAP and a disclosure principle that requires entities to disclose events since the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods, with early adoption permitted. (r) 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. 117 3. RELATED PARTY TRANSACTIONS As provided by Farmer Mac's statutory Charter, only banks, insurance companies, and other financial institutions or similar entities may hold Farmer Mac's Class A voting common stock and only institutions of the Farm Credit System may hold Farmer Mac's Class B voting common stock. Farmer Mac's statutory Charter also provides that Class A stockholders elect 5 members of Farmer Mac's 15 -member board of directors and that Class B stockholders elect 5 members of the board of directors. Farmer Mac generally requires financial institutions to own a requisite amount of common stock, based on the size and type of institution, to participate in the Agricultural Finance line of business. As a result of these requirements, Farmer Mac conducts business with related parties in the normal course of Farmer Mac's business. All related party transactions were conducted with terms and conditions comparable to those available to any other participant in Farmer Mac's lines of business not related to Farmer Mac. In general, Farmer Mac's related parties include entities that hold more than 10 % of total Farmer Mac voting common stock outstanding. Material related party transactions during 2025, 2024, and 2023 are disclosed below. Zions Bancorporation, National Association : Zions Bancorporation, National Association and its affiliates ("Zions") is a related party as they own approximately 21.0 % of Farmer Mac's total voting common stock outstanding. The following transactions occurred between Farmer Mac and Zions during 2025, 2024, and 2023: Table 3.1 For the Years Ended December 31, 2025 2024 2023 (in thousands) Unpaid Principal Balance: Purchases: Loans $ 148,118 $ 173,928 $ 160,079 USDA Securities — 363 231 Sales of Farmer Mac Guaranteed Securities — 60,192 — As of December 31, 2025, Farmer Mac had entered into mandatory purchase commitments with Zions of $ 4.6 million. Zions retained servicing fees of $ 11.6 million, $ 11.2 million, and $ 11.2 million in 2025, 2024, and 2023, respectively, for its work as a Farmer Mac servicer. CoBank : CoBank is a related party as they own approximately 10.7 % of Farmer Mac's total voting common stock outstanding. The following transactions occurred between Farmer Mac and CoBank during 2025, 2024, and 2023: 118 Table 3.2 For the Years Ended December 31, 2025 2024 2023 (in thousands) Unpaid Principal Balance: Purchases: Loans $ 529,156 $ 442,749 $ 438,821 CoBank retained servicing fees of $ 4.1 million, $ 4.0 million, and $ 3.6 million in 2025, 2024, and 2023, respectively, for its work as a Farmer Mac central servicer. 4. INVESTMENT SECURITIES Farmer Mac’s investment securities portfolio is comprised primarily of the following major portfolios, which is based on the issuer and associated security characteristics: Liquidity Investments: • U.S. Government guaranteed securities: single-family and multi-family mortgage-backed securities issued by Government National Mortgage Association (Ginnie Mae) and pass-through securities issued by the Small Business Administration, which are guaranteed by the U.S. Government; • GSE guaranteed securities: single-family and multi-family mortgage-backed securities issued by Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac). GSE securities are not guaranteed by the U.S. government; • U.S. Treasury Obligations: sovereign debt issued by the United States of America. Program Investments: • AgVantage Securities: securities backed by corporate obligations of approved agricultural or rural infrastructure financial institution counterparties, backed by a pledge of eligible agricultural or infrastructure finance mortgages. • USDA Securities: securities backed by the guaranteed portion of a loan guaranteed by the USDA under the Consolidated Farm and Rural Development Act. 119 The following tables set forth information about Farmer Mac's available-for-sale and held-to-maturity investment securities as of December 31, 2025 and 2024: Table 4.1 As of December 31, 2025 Amortized Cost (1) Allowance for losses (2) Unrealized Gains Unrealized Losses Fair Value (in thousands) Available-for-sale: Government/GSE guaranteed mortgage-backed securities $ 5,351,174 $ — $ 35,078 $ ( 89,234 ) $ 5,297,018 U.S. Treasuries 1,537,112 — 7,083 ( 48 ) 1,544,147 AgVantage 6,917,225 ( 130 ) 29,056 ( 215,234 ) 6,730,917 Interest-Only Farmer Mac Guaranteed Securities 8,040 — 163 — 8,203 Total available-for-sale $ 13,813,551 $ ( 130 ) $ 71,380 $ ( 304,516 ) $ 13,580,285 Held-to-maturity: Government/GSE guaranteed mortgage-backed securities $ 8,657 $ — $ 281 $ — $ 8,938 AgVantage 1,486,284 ( 77 ) 16,444 ( 3,731 ) 1,498,920 USDA Securities 2,459,359 — 5,851 ( 179,116 ) 2,286,094 Total held-to-maturity $ 3,954,300 $ ( 77 ) $ 22,576 $ ( 182,847 ) $ 3,793,952 (1) Amounts presented exclude $ 91.3 million and $ 56.7 million of accrued interest receivable on available-for-sale and held-to-maturity securities, respectively, as of December 31, 2025. (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. As of December 31, 2024 Amortized Cost (1) Allowance for losses (2) Unrealized Gains Unrealized Losses Fair Value (in thousands) Available-for-sale: Auction-rate certificates backed by Government guaranteed student loans $ 19,700 $ ( 27 ) $ — $ ( 197 ) $ 19,476 Government/GSE guaranteed mortgage-backed securities 4,793,482 — 6,910 ( 156,700 ) 4,643,692 U.S. Treasuries 1,291,934 — 2,604 ( 4,692 ) 1,289,846 AgVantage 5,826,948 ( 236 ) 6,295 ( 327,476 ) 5,505,531 Interest-Only Farmer Mac Guaranteed Securities 8,710 — 305 — 9,015 Total available-for-sale $ 11,940,774 $ ( 263 ) $ 16,114 $ ( 489,065 ) $ 11,467,560 Held-to-maturity: Government/GSE guaranteed mortgage-backed securities $ 9,270 $ — $ 270 $ — $ 9,540 AgVantage 2,667,564 ( 178 ) 5,978 ( 21,592 ) 2,651,772 USDA Securities 2,420,836 — 426 ( 259,410 ) 2,161,852 Total held-to-maturity $ 5,097,670 $ ( 178 ) $ 6,674 $ ( 281,002 ) $ 4,823,164 (1) Amounts presented exclude $ 79.7 million and $ 59.9 million of accrued interest receivable on available-for-sale and held-to-maturity securities, respectively, as of December 31, 2024. (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. As of December 31, 2025 and 2024, to satisfy initial margin requirements for centrally cleared derivatives, Farmer Mac pledged U.S. Treasuries with fair value of $ 250.6 million and $ 213.4 million, respectively, as collateral at the Chicago Mercantile Exchange ("CME"). During the year ended December 31, 2025, Farmer Mac sold floating rate auction-rate certificates backed by government guaranteed student loans for $ 19.5 million from its available-for-sale investment portfolio, resulting in a realized loss of $ 0.2 million. During the year ended December 31, 2024, Farmer Mac sold floating rate government/GSE guaranteed mortgage-backed securities for $ 115.2 million from its 120 available-for-sale investment portfolio, resulting in a gain of $ 1.1 million. These sales were done to rebalance the liquidity investment portfolio given the lower level of business volume activity while demonstrating that the portfolio provides strong contingent liquidity. Farmer Mac did not sell any securities from its available-for-sale investment portfolio during the year ended December 31, 2023. As of December 31, 2025 and 2024, unrealized losses on available-for-sale investment securities were as follows: Table 4.2 As of December 31, 2025 Available-for-Sale Securities Unrealized loss position for less than 12 months Unrealized loss position for more than 12 months Fair Value Unrealized Loss Fair Value Unrealized Loss (dollars in thousands) Government/GSE guaranteed mortgage-backed securities $ 799,619 $ ( 4,695 ) $ 2,008,388 $ ( 84,539 ) U.S. Treasuries 29,902 ( 13 ) 95,270 ( 35 ) AgVantage 1,607,457 ( 18,768 ) 3,123,117 ( 196,466 ) Total $ 2,436,978 $ ( 23,476 ) $ 5,226,775 $ ( 281,040 ) As of December 31, 2024 Available-for-Sale Securities Unrealized loss position for less than 12 months Unrealized loss position for more than 12 months Fair Value Unrealized Loss Fair Value Unrealized Loss (dollars in thousands) Auction-rate certificates backed by Government guaranteed student loans $ — $ — $ 19,476 $ ( 197 ) Government/GSE guaranteed mortgage-backed securities 1,269,655 ( 18,102 ) 1,971,526 ( 138,598 ) U.S. Treasuries 590,307 ( 4,375 ) 58,523 ( 317 ) AgVantage 1,152,227 ( 12,889 ) 3,649,845 ( 314,587 ) Total $ 3,012,189 $ ( 35,366 ) $ 5,699,370 $ ( 453,699 ) The unrealized losses presented above are primarily due to changes in the levels of interest rates from the dates of acquisition to December 31, 2025 and 2024, as applicable. 121 The amortized cost, fair value, and weighted-average yield of available-for-sale investment securities by remaining contractual maturity as of December 31, 2025 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. Table 4.3 As of December 31, 2025 Available-for-Sale Securities Amortized Cost (1) Fair Value Weighted-Average Yield (dollars in thousands) Due within one year $ 1,494,158 $ 1,488,988 3.46 % Due after one year through five years 6,668,349 6,659,089 4.07 % Due after five years through ten years 3,451,994 3,324,384 3.59 % Due after ten years 2,199,050 2,107,824 4.26 % Total $ 13,813,551 $ 13,580,285 3.93 % (1) Amounts presented exclude $ 91.3 million of accrued interest receivable. As of December 31, 2025 Held-to-Maturity Securities Amortized Cost (1) Fair Value Weighted-Average Yield (dollars in thousands) Due within one year $ 566,164 $ 571,874 2.73 % Due after one year through five years 396,194 389,606 4.81 % Due after five years through ten years 328,640 301,797 3.83 % Due after ten years 2,663,302 2,530,675 4.24 % Total $ 3,954,300 $ 3,793,952 4.04 % (1) Amounts presented exclude $ 56.7 million of accrued interest receivable. 122 5. FINANCIAL DERIVATIVES 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 $ 24.2 million and $ 15.8 million of accrued interest receivable and $ 2.4 million and $ 4.9 million of accrued interest payable on uncleared swaps as of December 31, 2025 and 2024, respectively. The aforementioned accrued interest on uncleared swaps is included within Accrued Interest Receivable and Accrued Interest Payable on the Consolidated Balance Sheets. Table 5.1 As of December 31, 2025 Fair Value Weighted- Average Pay Rate Weighted- Average Receive Rate Weighted- Average Forward Price Weighted- Average Remaining Term (in years) Notional Amount Asset (Liability) (dollars in thousands) Fair value hedges: Interest rate swaps: Receive fixed non-callable $ 6,388,935 $ 330 $ ( 2,954 ) 4.08 % 3.56 % 1.12 Pay fixed non-callable 10,681,418 16,685 ( 168 ) 2.79 % 3.93 % 8.66 Receive fixed callable 5,446,883 19,322 ( 19,911 ) 3.96 % 3.73 % 3.14 Cash flow hedges: Interest rate swaps: Pay fixed non-callable 452,000 9,335 ( 1 ) 1.92 % 4.22 % 3.00 No hedge designation: Interest rate swaps: Pay fixed non-callable 159,684 613 ( 1 ) 2.88 % 4.13 % 3.61 Receive fixed non-callable 1,963,363 66 ( 9 ) 3.89 % 3.93 % 0.28 Basis swaps 382,811 1 ( 190 ) 4.13 % 3.89 % 5.03 Treasury futures 102,000 154 ( 15 ) 112.57 Netting adjustments (1) — ( 1,631 ) 1,631 Total financial derivatives $ 25,577,094 $ 44,875 $ ( 21,618 ) (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. 123 As of December 31, 2024 Fair Value Weighted- Average Pay Rate Weighted- Average Receive Rate Weighted- Average Forward Price Weighted- Average Remaining Term (in years) Notional Amount Asset (Liability) (dollars in thousands) Fair value hedges: Interest rate swaps: Receive fixed non-callable $ 7,460,685 $ 174 $ ( 12,165 ) 4.71 % 3.40 % 1.53 Pay fixed non-callable 9,657,181 5,134 ( 97 ) 2.67 % 4.56 % 9.12 Receive fixed callable 4,592,077 5,119 ( 65,167 ) 4.54 % 3.67 % 2.65 Cash flow hedges: Interest rate swaps: Pay fixed non-callable 540,000 16,903 ( 2 ) 1.92 % 4.87 % 3.43 No hedge designation: Interest rate swaps: Pay fixed non-callable 157,776 819 ( 1 ) 2.92 % 4.75 % 3.40 Receive fixed non-callable 1,803,328 48 ( 2 ) 4.52 % 4.43 % 0.30 Basis swaps 655,384 8 ( 354 ) 4.69 % 4.52 % 3.83 Treasury futures 29,900 46 — 108.91 Netting adjustments (1) — ( 462 ) 462 Total financial derivatives $ 24,896,331 $ 27,789 $ ( 77,326 ) (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 December 31, 2025, Farmer Mac expects to reclassify $ 6.5 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 December 31, 2025. 124 The following tables summarize the net income/(expense) recognized in the Consolidated Statements of Operations related to derivatives for the years ended December 31, 2025, 2024, and 2023: Table 5.2 For the Year Ended December 31, 2025 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 Loans Total Interest Expense Losses on financial derivatives (in thousands) Total amounts presented in the Consolidated Statement of Operations $ 846,441 $ 765,806 $ ( 1,221,513 ) $ ( 5,120 ) $ 385,614 Income/(expense) related to interest settlements on fair value hedging relationships: Recognized on derivatives 113,183 48,551 ( 104,089 ) — 57,645 Recognized on hedged items 284,605 83,603 ( 410,306 ) — ( 42,098 ) Premium/discount amortization recognized on hedged items 2,551 — ( 2,606 ) — ( 55 ) Income/(expense) related to interest settlements on fair value hedging relationships $ 400,339 $ 132,154 $ ( 517,001 ) $ — $ 15,492 (Losses)/gains on fair value hedging relationships: Recognized on derivatives $ ( 188,941 ) $ ( 38,209 ) $ 159,983 $ — $ ( 67,167 ) Recognized on hedged items 188,506 41,128 ( 155,689 ) — 73,945 (Losses)/gains on fair value hedging relationships $ ( 435 ) $ 2,919 $ 4,294 $ — $ 6,778 Expense related to interest settlements on cash flow hedging relationships: Interest settlements reclassified from AOCI into net income on derivatives $ — $ — $ 14,140 $ — $ 14,140 Recognized on hedged items — — ( 23,454 ) — ( 23,454 ) Discount amortization recognized on hedged items — — ( 68 ) — ( 68 ) Expense recognized on cash flow hedges $ — $ — $ ( 9,382 ) $ — $ ( 9,382 ) Losses on financial derivatives not designated in hedging relationships: Losses on interest rate swaps $ — $ — $ — $ ( 2,784 ) $ ( 2,784 ) Interest expense on interest rate swaps — — — ( 441 ) ( 441 ) Treasury futures — — — ( 1,895 ) ( 1,895 ) Losses on financial derivatives not designated in hedge relationships $ — $ — $ — $ ( 5,120 ) $ ( 5,120 ) 125 For the Year Ended December 31, 2024 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 Loans Total Interest Expense Gains on financial derivatives (in thousands) Total amounts presented in the Consolidated Statement of Operations: $ 974,329 $ 629,187 $ ( 1,249,649 ) $ 2,636 $ 356,503 Income/(expense) related to interest settlements on fair value hedging relationships: Recognized on derivatives 188,146 68,346 ( 275,387 ) — ( 18,895 ) Recognized on hedged items 258,062 69,516 ( 423,428 ) — ( 95,850 ) Premium/discount amortization recognized on hedged items 2,134 — ( 3,197 ) — ( 1,063 ) Income/(expense) related to interest settlements on fair value hedging relationships $ 448,342 $ 137,862 $ ( 702,012 ) $ — $ ( 115,808 ) Gains/(losses) on fair value hedging relationships: Recognized on derivatives $ 81,675 $ 71,213 $ 105,355 $ — $ 258,243 Recognized on hedged items ( 78,424 ) ( 66,852 ) ( 101,419 ) — ( 246,695 ) Gains/(losses) on fair value hedging relationships $ 3,251 $ 4,361 $ 3,936 $ — $ 11,548 Expense related to interest settlements on cash flow hedging relationships: Interest settlements reclassified from AOCI into net income on derivatives $ — $ — $ 20,657 $ — $ 20,657 Recognized on hedged items — — ( 31,241 ) — ( 31,241 ) Discount amortization recognized on hedged items — — ( 34 ) — ( 34 ) Expense recognized on cash flow hedges $ — $ — $ ( 10,618 ) $ — $ ( 10,618 ) Gains on financial derivatives not designated in hedge relationships: Gains on interest rate swaps $ — $ — $ — $ 2,424 $ 2,424 Interest expense on interest rate swaps — — — ( 1,377 ) ( 1,377 ) Treasury futures — — — 1,589 1,589 Gains on financial derivatives not designated in hedge relationships $ — $ — $ — $ 2,636 $ 2,636 126 For the Year Ended December 31, 2023 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 Loans Total Interest Expense Gains on financial derivatives (in thousands) Total amounts presented in the Consolidated Statement of Operations: $ 877,394 $ 514,894 $ ( 1,064,741 ) $ 2,882 $ 330,429 Income/(expense) related to interest settlements on fair value hedging relationships: Recognized on derivatives 181,404 64,648 ( 345,852 ) — ( 99,800 ) Recognized on hedged items 216,884 63,133 ( 341,523 ) — ( 61,506 ) Premium/discount amortization recognized on hedged items 1,860 — ( 2,865 ) — ( 1,005 ) Income/(expense) related to interest settlements on fair value hedging relationships $ 400,148 $ 127,781 $ ( 690,240 ) $ — $ ( 162,311 ) (Losses)/gains on fair value hedging relationships: Recognized on derivatives $ ( 110,596 ) $ ( 23,528 ) $ 279,803 $ — $ 145,679 Recognized on hedged items 107,909 21,686 ( 280,668 ) — ( 151,073 ) (Losses)/gains on fair value hedging relationships $ ( 2,687 ) $ ( 1,842 ) $ ( 865 ) $ — $ ( 5,394 ) Expense related to interest settlements on cash flow hedging relationships: Interest settlements reclassified from AOCI into net income on derivatives $ — $ — $ 20,643 $ — $ 20,643 Recognized on hedged items — — ( 31,610 ) — ( 31,610 ) Discount amortization recognized on hedged items — — ( 55 ) — ( 55 ) Expense recognized on cash flow hedges $ — $ — $ ( 11,022 ) $ — $ ( 11,022 ) Gains on financial derivatives not designated in hedge relationships: Gains on interest rate swaps $ — $ — $ — $ 4,395 $ 4,395 Interest expense on interest rate swaps — — — ( 4,845 ) ( 4,845 ) Treasury futures — — — 3,332 3,332 Gains on financial derivatives not designated in hedge relationships $ — $ — $ — $ 2,882 $ 2,882 127 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 December 31, 2025 and 2024: Table 5.3 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) December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 (in thousands) Investment securities, Available-for-Sale, at fair value (1) $ 7,818,278 $ 6,956,364 $ ( 235,989 ) $ ( 424,495 ) Loans held for investment, at amortized cost 2,278,212 1,816,738 ( 331,315 ) ( 372,444 ) Notes Payable (2) ( 11,837,713 ) ( 11,899,049 ) ( 6,690 ) 148,999 (1) Amortized cost of $ 8.0 billion and $ 7.4 billion as of December 31, 2025 and 2024, respectively. (2) 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 December 31, 2025 and 2024: Table 5.4 December 31, 2025 Gross Amount Recognized Gross Amounts offset in the Consolidated Balance Sheet Net Amount Presented in the Consolidated Balance Sheet (1) Gross Amounts Not Offset in the Consolidated Balance Sheet Netting Adjustments Financial instruments pledged Cash Collateral Net Amount (2) (in thousands) Assets: Uncleared derivatives $ 29,179 $ — $ 29,179 $ ( 15,601 ) $ — $ ( 11,684 ) $ 1,894 Cleared derivatives 17,242 ( 1,631 ) 15,611 — ( 15,611 ) — — Total $ 46,421 $ ( 1,631 ) $ 44,790 $ ( 15,601 ) $ ( 15,611 ) $ ( 11,684 ) $ 1,894 Liabilities: Uncleared derivatives $ ( 21,512 ) $ — $ ( 21,512 ) $ 15,601 $ — $ 2,093 $ ( 3,818 ) Cleared derivatives ( 1,631 ) 1,631 — — — — — Total $ ( 23,143 ) $ 1,631 $ ( 21,512 ) $ 15,601 $ — $ 2,093 $ ( 3,818 ) (1) Amounts presented may not agree to the consolidated balance sheet related to counterparties not subject to master netting agreements. (2) Any over-collateralization at an individual clearing agent and/or counterparty level is not included in the determination of the net amount. As of December 31, 2025, Farmer Mac had additional net exposure of $ 235.0 million due to instances where Farmer Mac's collateral to a counterparty exceeded the net derivative position and $ 16.9 million due to instances where Farmer Mac's collateral from a counterparty exceeded the net derivative position. 128 December 31, 2024 Gross Amount Recognized Gross Amounts offset in the Consolidated Balance Sheet Net Amount Presented in the Consolidated Balance Sheet Gross Amounts Not Offset in the Consolidated Balance Sheet Netting Adjustments Financial instruments pledged Cash Collateral Net Amount (1) (in thousands) Assets: Uncleared derivatives $ 22,759 $ — $ 22,759 $ ( 22,061 ) $ — $ ( 652 ) $ 46 Cleared derivatives 5,492 ( 462 ) 5,030 — ( 5,030 ) — — Total $ 28,251 $ ( 462 ) $ 27,789 $ ( 22,061 ) $ ( 5,030 ) $ ( 652 ) $ 46 Liabilities: Uncleared derivatives $ ( 77,326 ) $ — $ ( 77,326 ) $ 22,061 $ — $ 44,299 $ ( 10,966 ) Cleared derivatives ( 462 ) 462 — — — — — Total $ ( 77,788 ) $ 462 $ ( 77,326 ) $ 22,061 $ — $ 44,299 $ ( 10,966 ) (1) Any over-collateralization at an individual clearing agent and/or counterparty level is not included in the determination of the net amount. As of December 31, 2024, Farmer Mac had additional net exposure of $ 209.0 million due to instances where Farmer Mac's collateral to a counterparty exceeded the net derivative position and $ 4.7 million due to instances where Farmer Mac's collateral from a counterparty exceeded the net derivative position. Farmer Mac records posted cash as a reduction in the outstanding balance of cash and cash equivalents and an increase in the balance of prepaid expenses and other assets. 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 December 31, 2025 or 2024, it could have been required to settle its obligations under the agreements, but would not have been required to post additional collateral. As of December 31, 2025 and 2024, 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 $ 25.5 billion notional amount of interest rate swaps outstanding as of December 31, 2025, $ 19.4 billion were cleared through CME. Of Farmer Mac's $ 24.9 billion notional amount of interest rate swaps outstanding as of December 31, 2024, $ 19.1 billion were cleared through the CME. 6. NOTES PAYABLE Farmer Mac's borrowings consist of discount notes and medium-term notes, both of which are unsecured general obligations of Farmer Mac. Discount notes generally have original maturities of 1 year or less, whereas medium-term notes generally have original maturities of 0.5 years to 25.0 years. 129 The following tables set forth information related to Farmer Mac's borrowings as of December 31, 2025 and 2024: Table 6.1 December 31, 2025 Outstanding as of December 31 Average Outstanding During the Year Amount Weighted- Average Rate Amount Weighted- Average Rate (dollars in thousands) Due within one year: Discount notes $ 2,614,571 3.87 % $ 1,854,488 4.22 % Medium-term notes 2,822,454 4.02 % 2,901,863 4.35 % Current portion of medium-term notes 5,834,657 2.77 % Total due within one year $ 11,271,682 3.34 % Due after one year: Medium-term notes due in: Two years $ 6,641,397 3.65 % Three years 3,740,471 3.97 % Four years 2,836,656 4.24 % Five years 3,889,804 3.71 % Thereafter 2,435,870 2.88 % Total due after one year $ 19,544,198 3.71 % Total principal net of discounts $ 30,815,880 3.58 % Hedging adjustments 6,690 Total $ 30,822,570 December 31, 2024 Outstanding as of December 31 Average Outstanding During the Year Amount Weighted- Average Rate Amount Weighted- Average Rate (dollars in thousands) Due within one year: Discount notes $ 2,167,258 4.42 % $ 1,928,884 5.11 % Medium-term notes 2,343,264 4.64 % 1,000,290 5.28 % Current portion of medium-term notes 5,927,101 3.20 % Total due within one year $ 10,437,623 3.77 % Due after one year: Medium-term notes due in: Two years $ 4,844,538 2.66 % Three years 3,822,999 3.53 % Four years 2,732,980 4.13 % Five years 2,491,831 4.41 % Thereafter 3,190,202 2.63 % Total due after one year $ 17,082,550 3.34 % Total principal net of discounts $ 27,520,173 3.51 % Hedging adjustments ( 148,999 ) Total $ 27,371,174 130 The maximum amount of Farmer Mac's discount notes outstanding at any month end during the years ended December 31, 2025 and 2024 was $ 2.6 billion and $ 2.3 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 2026 as of December 31, 2025: Table 6.2 Debt Callable in 2026 as of December 31, 2025, by Maturity Amount Weighted-Average Rate (dollars in thousands) Maturity: 2027 $ 1,144,586 2.99 % 2028 1,408,199 4.04 % 2029 1,493,927 4.45 % 2030 1,395,746 3.22 % Thereafter 1,472,467 2.66 % Total $ 6,914,925 3.49 % The following schedule summarizes the earliest interest rate reset date, or debt maturities, of total borrowings outstanding as of December 31, 2025, including callable and non-callable medium-term notes, assuming callable notes are redeemed at the initial call date: Table 6.3 Earliest Interest Rate Reset Date, or Debt Maturities, of Borrowings Outstanding Amount Weighted-Average Rate (dollars in thousands) Debt with interest rate resets, or debt maturities in: 2026 $ 14,354,481 3.49 % 2027 4,248,054 3.42 % 2028 3,497,592 3.96 % 2029 2,669,771 4.25 % 2030 3,854,837 3.70 % Thereafter 2,191,145 2.73 % Total principal net of discounts $ 30,815,880 3.58 % During the years ended December 31, 2025 and 2024, Farmer Mac called $ 2.2 billion and $ 1.9 billion of callable medium-term notes, respectively. Authority to Borrow from the U.S. Treasury Farmer Mac's statutory Charter authorizes it to borrow up to $ 1.5 billion from the U.S. Treasury through the issuance of debt obligations to the U.S. Treasury. Any funds borrowed from the U.S. Treasury may be used solely to fulfill Farmer Mac's guarantee obligations. The Charter provides that the U.S. Treasury is required to purchase debt obligations up to the authorized limit if Farmer Mac certifies that: 131 • a portion of the guarantee fees have been set aside as a reserve against losses arising from guarantee activities in an amount determined by Farmer Mac's board of directors to be necessary and such reserve has been exhausted; and • the proceeds of the purchase of such obligations are needed to fulfill Farmer Mac's guarantee obligations. 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. The Charter requires Farmer Mac to repurchase any of its debt obligations held by the U.S. Treasury within a reasonable time. As of December 31, 2025, Farmer Mac had not used this borrowing authority. 7. LOANS Farmer Mac classifies loans as either held for investment or held for sale. Loans held for investment are recorded at the unpaid principal balance, net of unamortized premium or discount and other cost basis adjustments. Loans held for sale are reported at the lower of cost or fair value determined on a pooled basis. Under the Agricultural Finance line of business, Farmer Mac has two segments – Farm & Ranch and Corporate AgFinance. Farmer Mac monitors and assesses credit risk for each segment, recognizing the different credit risk profiles within each segment. The following table includes loans held for investment and loans held for sale and displays the composition of the loan balances as of December 31, 2025 and 2024: Table 7.1 As of December 31, 2025 As of December 31, 2024 Unsecuritized In Consolidated Trusts Total Unsecuritized In Consolidated Trusts Total (in thousands) Agricultural Finance loans Farm & Ranch $ 6,002,738 $ 2,482,010 $ 8,484,748 $ 5,414,732 $ 2,038,283 $ 7,453,015 Corporate AgFinance 1,460,691 — 1,460,691 1,381,674 — 1,381,674 Total Agricultural Finance loans 7,463,429 2,482,010 9,945,439 6,796,406 2,038,283 8,834,689 Infrastructure Finance loans 6,761,081 — 6,761,081 4,774,483 — 4,774,483 Total unpaid principal balance (1) 14,224,510 2,482,010 16,706,520 11,570,889 2,038,283 13,609,172 Unamortized premiums, discounts, fair value hedge basis adjustment, and other cost basis adjustments ( 347,459 ) — ( 347,459 ) ( 381,311 ) — ( 381,311 ) Total loans 13,877,051 2,482,010 16,359,061 11,189,578 2,038,283 13,227,861 Allowance for losses ( 36,673 ) ( 1,112 ) ( 37,785 ) ( 22,594 ) ( 629 ) ( 23,223 ) Total loans, net of allowance $ 13,840,378 $ 2,480,898 $ 16,321,276 $ 11,166,984 $ 2,037,654 $ 13,204,638 (1) Unpaid principal balance is the basis of presentation in disclosures of outstanding balances for Farmer Mac's lines of business. 132 Allowance for Losses The following table is a summary, by asset type, of the allowance for losses as of December 31, 2025 and 2024: Table 7.2 December 31, 2025 December 31, 2024 Allowance for Losses Allowance for Losses (in thousands) Loans: Agricultural Finance loans Farm & Ranch $ 9,400 $ 5,132 Corporate AgFinance 6,631 5,379 Total Agricultural Finance loans 16,031 10,511 Infrastructure Finance loans 21,754 12,712 Total $ 37,785 $ 23,223 The following is a summary of the changes in the allowance for losses for each year in the three-year period ended December 31, 2025: Table 7.3 Agricultural Finance loans Infrastructure Finance loans (3) Farm & Ranch (1) Corporate AgFinance (2) Total (in thousands) Balance as of December 31, 2022 $ 4,044 $ 2,731 $ 6,775 $ 8,314 (Release of)/provision for losses ( 108 ) 217 109 833 Charge-offs — — — — Balance as of December 31, 2023 $ 3,936 $ 2,948 $ 6,884 $ 9,147 Provision for losses 1,297 6,828 8,125 3,565 Charge-offs ( 101 ) ( 4,397 ) ( 4,498 ) — Balance as of December 31, 2024 $ 5,132 $ 5,379 $ 10,511 $ 12,712 Provision for losses 8,657 15,394 24,051 9,042 Charge-offs ( 6,064 ) ( 14,819 ) ( 20,883 ) — Recovery 1,675 677 2,352 — Balance as of December 31, 2025 $ 9,400 $ 6,631 $ 16,031 $ 21,754 (1) As of December 31, 2025, 2024, and 2023, the allowance for losses for Agricultural Finance Farm & Ranch loans includes $ 1.6 million, $ 1.2 million, and $ 1.0 million allowance for collateral dependent assets secured by agricultural real estate, respectively. (2) As of December 31, 2025, 2024, and 2023, the allowance for losses for Agricultural Finance Corporate AgFinance loans includes $ 1.0 million, $ 1.0 million, and $ 0.0 million allowance for collateral dependent assets secured by agricultural real estate, respectively. (3) As of December 31, 2025, the allowance for losses for Infrastructure Finance loans includes $ 5.2 million allowance for collateral dependent assets. As of December 31, 2024 and 2023 there was no allowance for collateral dependent assets. The $ 24.1 million net provision to the allowance for the Agricultural Finance mortgage loan portfolio during the year ended December 31, 2025 primarily consisted of: • $ 14.6 million related to individually significant credit deteriorations within the Corporate AgFinance portfolio, which we also charged off because we deemed these amounts to be uncollectible. 133 • $ 5.0 million related to credit deterioration within the Farm & Ranch portfolio, of which we had a net charge off of $ 4.4 million because we deemed that amount to be uncollectible. • The remainder was attributable to net volume growth during 2025. The $ 9.0 million net provision to the allowance for the Infrastructure Finance portfolio during year ended December 31, 2025 was primarily attributable to $ 5.1 million in individually significant credit deterioration in the Broadband Infrastructure portfolio and $ 3.9 million in net volume growth. The $ 8.1 million net provision to the allowance for the Agricultural Finance mortgage loan portfolio during the year ended December 31, 2024 was primarily attributable to two permanent planting borrower relationships and other risk rating downgrades. During the year ended December 31, 2024, Farmer Mac had charge-offs of $ 4.5 million, which was primarily related to a single permanent planting borrower that entered into bankruptcy during second quarter 2024, at which time $ 3.9 million was deemed uncollectible. The $ 3.6 million net provision to the allowance for the Infrastructure Finance portfolio during the year ended December 31, 2024 was primarily attributable to new loan volume within the Broadband Infrastructure and Renewable Energy segments and a single renewable energy project that became substandard during fourth quarter 2024. The $ 0.1 million net provision to the allowance for the Agricultural Finance mortgage loan portfolio during the year ended December 31, 2023 was primarily attributable to increased loan volume. The $ 0.8 million net provision to the allowance for the Infrastructure Finance portfolio during the year ended December 31, 2023 was primarily attributable to a single telecommunications loan that was downgraded to substandard during the year. The following table presents the unpaid principal balances by delinquency status of Farmer Mac's loans and non-performing assets as of December 31, 2025 and 2024: Table 7.4 As of December 31, 2025 Accruing Current 30-59 Days 60-89 Days 90 Days and Greater Total Past Due Nonaccrual Loans (2)(3) Total Loans (in thousands) Loans (1) : Agricultural Finance loans Farm & Ranch $ 8,271,176 $ 21,209 $ 8,595 $ 4,290 $ 34,094 $ 179,478 $ 8,484,748 Corporate AgFinance 1,415,507 — — — — 45,184 1,460,691 Total Agricultural Finance loans 9,686,683 21,209 8,595 4,290 34,094 224,662 9,945,439 Infrastructure Finance loans 6,747,694 — — — — 13,387 6,761,081 Total $ 16,434,377 $ 21,209 $ 8,595 $ 4,290 $ 34,094 $ 238,049 $ 16,706,520 (1) Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on the recorded investment of the loan. (2) Includes loans that are 90 days or 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) Includes $ 59.2 million of nonaccrual loans for which there was no associated allowance. During the year ended December 31, 2025, Farmer Mac received $ 6.5 million in interest on nonaccrual loans, respectively. 134 As of December 31, 2024 Accruing Current 30-59 Days 60-89 Days 90 Days and Greater Total Past Due Nonaccrual Loans (2)(3) Total Loans (in thousands) Loans (1) : Agricultural Finance loans Farm & Ranch $ 7,299,364 $ 16,478 $ 7,268 $ 6,359 $ 30,105 $ 123,546 $ 7,453,015 Corporate AgFinance 1,336,305 — — — — 45,369 1,381,674 Total Agricultural Finance loans 8,635,669 16,478 7,268 6,359 30,105 168,915 8,834,689 Infrastructure Finance loans 4,774,483 — — — — — 4,774,483 Total $ 13,410,152 $ 16,478 $ 7,268 $ 6,359 $ 30,105 $ 168,915 $ 13,609,172 (1) Current loan amounts are presented based on contractual unpaid principal balance, while past due loan amounts are presented based on the recorded investment of the loan. (2) Primarily consists of loans that are 90 days or 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) Includes $ 41.5 million of nonaccrual loans for which there was no associated allowance. During the year ended December 31, 2024, Farmer Mac received $ 4.9 million in interest on nonaccrual loans. Credit Quality Indicators The following tables present credit quality indicators related to Agricultural Finance mortgage loans and Infrastructure Finance loans held as of December 31, 2025 and 2024, by year of origination: Table 7.5 As of December 31, 2025 Year of Origination: 2025 2024 2023 2022 2021 Prior Revolving Loans - Amortized Cost Basis Total (in thousands) Agricultural Finance - Farm & Ranch loans (1) : Internally Assigned Risk Rating: Acceptable $ 1,474,950 $ 938,955 $ 451,188 $ 921,048 $ 1,447,158 $ 1,964,423 $ 418,798 $ 7,616,520 Special mention (2) 260,579 95,950 28,693 37,269 25,928 35,505 22,958 506,882 Substandard (3) 17,583 40,618 35,538 71,201 33,835 140,445 22,126 361,346 Total $ 1,753,112 $ 1,075,523 $ 515,419 $ 1,029,518 $ 1,506,921 $ 2,140,373 $ 463,882 $ 8,484,748 For the Year Ended December 31, 2025: Current period charge-offs $ — $ — $ — $ 1,321 $ 721 $ 2,347 $ 1,675 $ 6,064 (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) Special mention assets 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. 135 As of December 31, 2025 Year of Origination: 2025 2024 2023 2022 2021 Prior Revolving Loans - Amortized Cost Basis Total (in thousands) Agricultural Finance - Corporate AgFinance (1) : Internally Assigned Risk Rating: Acceptable $ 364,140 $ 177,260 $ 120,428 $ 58,073 $ 131,421 $ 232,710 $ 212,487 $ 1,296,519 Special mention (2) — 16,514 7,273 — — 45,753 17,954 87,494 Substandard (3) — — 5,658 — 9,870 41,933 19,217 76,678 Total $ 364,140 $ 193,774 $ 133,359 $ 58,073 $ 141,291 $ 320,396 $ 249,658 $ 1,460,691 For the Year Ended December 31, 2025: Current period charge-offs $ — $ — $ — $ — $ 13,210 $ — $ 1,609 $ 14,819 (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) Special mention assets 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, 2025 Year of Origination: 2025 2024 2023 2022 2021 Prior Revolving Loans - Amortized Cost Basis Total (in thousands) Infrastructure Finance loans (1) : Internally Assigned Risk Rating: Acceptable $ 1,652,127 $ 1,238,560 $ 578,518 $ 488,572 $ 175,962 $ 1,668,596 $ 829,382 $ 6,631,717 Special mention (2) — — 18,863 37,244 — — — 56,107 Substandard (3) — — 27,903 45,354 — — — 73,257 Total $ 1,652,127 $ 1,238,560 $ 625,284 $ 571,170 $ 175,962 $ 1,668,596 $ 829,382 $ 6,761,081 For the Year Ended December 31, 2025: Current period 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) Special mention assets 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. 136 As of December 31, 2024 Year of Origination: 2024 2023 2022 2021 2020 Prior Revolving Loans - Amortized Cost Basis Total (in thousands) Agricultural Finance - Farm & Ranch loans (1) : Internally Assigned Risk Rating: Acceptable $ 987,444 $ 525,559 $ 1,079,933 $ 1,577,305 $ 1,019,779 $ 1,287,334 $ 404,950 $ 6,882,304 Special mention (2) 139,297 34,290 32,886 24,204 7,533 23,099 22,087 283,396 Substandard (3) 8,077 28,790 52,350 24,733 60,418 92,594 20,353 287,315 Total $ 1,134,818 $ 588,639 $ 1,165,169 $ 1,626,242 $ 1,087,730 $ 1,403,027 $ 447,390 $ 7,453,015 For the Year Ended December 31, 2024: Current period charge-offs $ — $ — $ — $ 101 $ — $ — $ — $ 101 (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) Special mention assets 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, 2024 Year of Origination: 2024 2023 2022 2021 2020 Prior Revolving Loans - Amortized Cost Basis Total (in thousands) Agricultural Finance - Corporate AgFinance loans (1) : Internally Assigned Risk Rating: Acceptable $ 210,807 $ 152,918 $ 64,860 $ 235,493 $ 80,085 $ 161,354 $ 262,295 $ 1,167,812 Special mention (2) — 37,010 — 14,557 75,440 — 7,158 134,165 Substandard (3) — 7,309 7,652 — 14,335 33,479 16,922 79,697 Total $ 210,807 $ 197,237 $ 72,512 $ 250,050 $ 169,860 $ 194,833 $ 286,375 $ 1,381,674 For the Year Ended December 31, 2024: Current period charge-offs $ — $ — $ 455 $ — $ — $ — $ 3,942 $ 4,397 (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) Special mention assets 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. 137 As of December 31, 2024 Year of Origination: 2024 2023 2022 2021 2020 Prior Revolving Loans - Amortized Cost Basis Total (in thousands) Infrastructure Finance loans (1) : Internally Assigned Risk Rating: Acceptable $ 1,158,427 $ 521,143 $ 578,882 $ 174,232 $ 574,135 $ 1,229,626 $ 461,162 $ 4,697,607 Special mention (2) — — 34,388 — — — — 34,388 Substandard (3) — 13,356 29,132 — — — — 42,488 Total $ 1,158,427 $ 534,499 $ 642,402 $ 174,232 $ 574,135 $ 1,229,626 $ 461,162 $ 4,774,483 For the Year Ended December 31, 2024: Current period 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) Special mention assets 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. Loan Modifications to Borrowers Experiencing Financial Difficulty As a part of our loss mitigation activities, Farmer Mac may agree to the modify the contractual terms of loans to borrowers experiencing financial difficulty. These modifications generally include payment deferrals, capitalization of interest, and extensions of maturities. During the years ended December 31, 2025, 2024, and 2023, within Agricultural Finance - Farm & Ranch loans, Farmer Mac modified loans to borrowers experiencing financial difficulty with aggregate unpaid principal balances of $ 33.8 million, $ 47.7 million, and $ 18.4 million, respectively. These amounts represented approximately 0.40 %, 0.64 %, and 0.28 % of the total Farm & Ranch loan portfolio for each respective year. There were no modifications to borrowers experiencing financial difficulty within the Agricultural Finance - Corporate AgFinance loans portfolio during the years ended December 31, 2025, 2024, and 2023. During the year ended December 31, 2025, within Infrastructure Finance loans, Farmer Mac modified loans to borrowers experiencing financial difficulty with aggregate unpaid principal balances of $ 13.2 million, which represented approximately 0.19 % of the Infrastructure Finance loans portfolio. There were no modifications to borrowers experiencing financial difficulty within the Infrastructure Finance loans portfolio during the years ended December 31, 2024 and 2023. The weighted‑average internal risk ratings for both the Agricultural Finance and Infrastructure Finance population of modified loans as of December 31, 2025 and 2024, were within the "substandard" internally assigned risk rating category. For additional information regarding Farmer Mac’s internally assigned risk ratings, see Table 7.5. 138 8. EQUITY Common Stock Farmer Mac has three classes of common stock outstanding: • Class A voting common stock, which may be held only by banks, insurance companies, and other financial institutions or similar entities that are not institutions of the Farm Credit System. By federal statute, no holder of Class A voting common stock may directly or indirectly be a beneficial owner of more than 33% of the outstanding shares of Class A voting common stock. • Class B voting common stock, which may be held only by institutions of the Farm Credit System. There are no restrictions on the maximum holdings of Class B voting common stock. • Class C non-voting common stock, which has no ownership restrictions. During 2025, 2024, and 2023, Farmer Mac paid a quarterly dividend of $ 1.50 , $ 1.40 , and $ 1.10 per share on all classes of its common stock. Farmer Mac's ability to declare and pay dividends on its common stock could be restricted if it fails to comply with applicable capital requirements. On August 5, 2025, Farmer Mac's board of directors revised the terms of the company's share repurchase program to increase the total authorized amount of repurchases from the then remaining $ 9.8 million to $ 50.0 million, and to extend the expiration date of the program to August 5, 2027. During fourth quarter 2025, Farmer Mac repurchased 78,481 shares of Class C non-voting common stock at a cost of approximately $ 12.9 million. As of December 31, 2025, Farmer Mac had repurchased approximately 751,000 shares of Class C non-voting common stock at a cost of approximately $ 32.7 million under the share repurchase program since its inception in 2015. As of December 31, 2025, $ 37.1 million remain available for repurchase under the program. Preferred Stock The following table presents the Outstanding Preferred Stock as of December 31, 2025: Table 8.1 Name Issuance Date Issuance Cost Shares Issued Annual Dividend Rate (1) Liquidation Value Per Share First Possible Redemption Date (2) Series D May 13, 2019 $ 3,340,456 4,000,000 5.700 % $ 25.00 July 17, 2024 Series E May 20, 2020 $ 2,496,750 3,180,000 5.750 % $ 25.00 July 17, 2025 Series F August 20, 2020 $ 3,839,902 4,800,000 5.250 % $ 25.00 October 17, 2025 Series G May 27, 2021 $ 3,673,677 5,000,000 4.875 % $ 25.00 July 17, 2026 Series H August 25, 2025 $ 3,156,010 4,000,000 6.500 % $ 25.00 October 17, 2030 (1) Dividends on all series of Outstanding Preferred Stock are non-cumulative, which means that if Farmer Mac's board of directors has not declared a dividend before the applicable dividend payment date for any dividend period, such dividend will not be paid or cumulate, and Farmer Mac will have no obligation to pay dividends for such dividend period, whether or not dividends on any series of Outstanding Preferred Stock are declared for any future dividend period. (2) Farmer Mac has the right but not the obligation to redeem. In August 2025, Farmer Mac issued 4.0 million shares of 6.500 % non-cumulative perpetual Series H preferred stock, par value $ 25.00 per share. Farmer Mac incurred direct costs of $ 3.1 million related to the issuance of the Series H preferred stock. The dividend rate on the Series H preferred stock will remain at a 139 non-cumulative, fixed rate of 6.500 % per year, when, as, and if a dividend is declared by the Board of Directors of Farmer Mac, for so long as the Series H preferred stock remains outstanding. The Series H preferred stock has no maturity date, but Farmer Mac has the option to redeem the preferred stock at any time on any dividend payment date on and after October 17, 2030. On July 18, 2024, Farmer Mac redeemed all outstanding shares of its 6.000 % Fixed-to-Floating Rate Non-Cumulative Series C Preferred Stock, plus any declared and unpaid dividends through and including the redemption date. As a result of this redemption, Farmer Mac recognized $ 1.6 million of loss on retirement of preferred stock in third quarter 2024, which was related to deferred issuance costs. Equity-Based Incentive Compensation Plans Farmer Mac's Amended and Restated 2008 Omnibus Incentive Compensation Plan authorizes the grant of restricted stock units and SARs, among other alternative forms of equity-based compensation, to Farmer Mac's directors, officers, and employees. SARs awarded to officers and employees vest annually in thirds. Farmer Mac has not granted SARs to directors since 2008. If not exercised or cancelled earlier due to the termination of employment, SARs granted to officers or employees expire after 10 years from the grant date. For all SARs granted, the exercise price is equal to the closing price of Farmer Mac's Class C non-voting common stock on the date of grant. Farmer Mac accounts for its stock-based employee compensation plans using the grant date fair value method of accounting. Under the fair value-based method of accounting for stock-based compensation cost, Farmer Mac recognized compensation expense of $ 8.3 million , $ 8.1 million, and $ 6.8 million during the years ended December 31, 2025, 2024, and 2023, respectively. During the years ended December 31, 2025, 2024, and 2023 , Farmer Mac recorded a net decrease to additional paid-in capital of $ 5.2 million, $ 5.4 million, and $ 3.1 million, respectively, related to stock-based compensation awards. 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 December 31, 2025 and 2024, 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 December 31, 2025, Farmer Mac's minimum capital requirement was $ 1.0 billion and its core capital level was $ 1.7 billion, which was $ 677.7 million above the minimum capital requirement as of that date. As of December 31, 2024, Farmer Mac's minimum capital requirement was $ 917.6 million and its core capital level was $ 1.5 billion, which was $ 583.5 million above the minimum capital requirement as of that date. 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. 140 9. INCOME TAXES Farmer Mac is subject to federal corporate income taxes but is exempt from state and local corporate income taxes. The components of the federal corporate income tax expense for the years ended December 31, 2025, 2024, and 2023 were as follows: Table 9.1 For the Year Ended December 31, 2025 2024 2023 (in thousands) Current income tax expense $ 59,371 $ 54,687 $ 46,712 Deferred income tax expense ( 11,075 ) ( 3,777 ) 6,386 Income tax expense $ 48,296 $ 50,910 $ 53,098 A reconciliation of income tax at the statutory federal corporate income tax rate to the income tax expense for the years ended December 31, 2025, 2024, and 2023 is as follows: Table 9.2 For the Year Ended December 31, 2025 2024 2023 Amount Percent Amount Percent Amount Percent (dollars in thousands) U.S. Federal Statutory Tax Rate $ 53,699 21.0 % $ 54,201 21.0 % $ 53,151 21.0 % Tax Credits Renewable Energy Investment Tax Credits ( 4,791 ) ( 1.9 ) % ( 2,627 ) ( 1.0 ) % — — % Other Tax Credits ( 869 ) ( 0.3 ) % ( 633 ) ( 0.3 ) % ( 305 ) ( 0.1 ) % Nontaxable or Nondeductible Items 257 0.1 % ( 31 ) — % 252 0.1 % Income tax expense $ 48,296 18.9 % $ 50,910 19.7 % $ 53,098 21.0 % 141 The components of the deferred tax assets and liabilities as of December 31, 2025 and 2024 were as follows: Table 9.3 As of December 31, 2025 2024 (in thousands) Deferred tax assets: Basis difference related to hedge items $ 120,907 $ 136,589 Unrealized losses on available-for-sale securities 1,711 12,441 Allowance for losses 8,331 5,310 Compensation and Benefits 2,506 1,779 Stock-based compensation 3,261 3,014 Other 5,789 5,887 Total deferred tax assets $ 142,505 $ 165,020 Deferred tax liability: Basis differences related to financial derivatives $ 120,446 $ 135,528 Unrealized gains on cash flow hedges 5,268 9,212 Basis difference related to structured securitizations 16,420 18,726 Other 198 10 Total deferred tax liability $ 142,332 $ 163,476 Net deferred tax asset $ 173 $ 1,544 As of December 31, 2025 and 2024, Farmer Mac did not identify any uncertain tax positions. Farmer Mac did no t have any unrecognized tax benefits for the years ended December 31, 2025, 2024, and 2023. Tax years 2022 through 2025 remain subject to examination. 142 10. GUARANTEES AND COMMITMENTS Farmer Mac has recorded a liability for its obligation to stand ready under Farmer Mac's LTSPCs in the guarantee and commitment obligation on the consolidated balance sheets. The following table presents Farmer Mac's liability, the maximum principal amount of potential undiscounted future payments that Farmer Mac could be requested to make under all LTSPCs (excluding offsets from recourse provisions, third-party recoveries, or loan collateral), the weighted-average remaining maturity of loans underlying LTSPCs, and the amount of the reserve for losses for the periods indicated: Table 10.1 As of December 31, 2025 As of December 31, 2024 (dollars in thousands) Guarantee and commitment obligation $ 49,750 $ 42,731 Maximum principal amount 4,997,829 4,029,019 Weighted-average remaining maturity 14.4 years 14.5 years Reserve for losses 1,586 1,623 Commitments Farmer Mac enters into mandatory and optional delivery commitments to purchase loans. Most loan purchase commitments entered into by Farmer Mac are mandatory commitments, in which Farmer Mac charges a fee to extend or cancel the commitment. As of December 31, 2025 and 2024, commitments to purchase Agricultural Finance loans and USDA Guarantees totaled $ 95.8 million and $ 54.0 million, respectively, all of which were mandatory commitments. Farmer Mac also has unfunded commitments and letters of credit under which Farmer Mac earns a nominal fee for the obligation to provide funding at a future date. As of December 31, 2025 and 2024, Farmer Mac had $ 1.1 billion and $ 0.6 billion of these unfunded commitments and letters of credit under the Agricultural Finance and Infrastructure lines of business. Any optional loan purchase commitments are sold forward under optional commitments to deliver Farmer Mac Guaranteed Securities that may be canceled by Farmer Mac without penalty. 143 11. 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 December 31, 2025 and 2024, respectively, and indicate the fair value hierarchy of the valuation techniques used by Farmer Mac to determine such fair value: Table 11.1 Assets and Liabilities Measured at Fair Value as of December 31, 2025 Level 1 Level 2 Level 3 (1) Total (in thousands) Recurring: Assets: Investment Securities: Available-for-sale: Government/GSE guaranteed mortgage-backed securities $ — $ 5,297,018 $ — $ 5,297,018 U.S. Treasuries 1,544,147 — — 1,544,147 AgVantage — — 6,730,917 6,730,917 Interest-Only Farmer Mac Guaranteed Securities — — 8,203 8,203 Total Available-for-sale Investment Securities 1,544,147 5,297,018 6,739,120 13,580,285 Financial derivatives 154 44,721 — 44,875 Other Assets (2) — — 4,897 4,897 Total Assets at fair value $ 1,544,301 $ 5,341,739 $ 6,744,017 $ 13,630,057 Liabilities: Financial derivatives $ 15 $ 21,603 $ — $ 21,618 Total Liabilities at fair value $ 15 $ 21,603 $ — $ 21,618 (1) Level 3 assets represent 19 % of total assets and 49 % of financial instruments measured at fair value. (2) Represents a retained beneficial interest related to transfers of financial assets. Assets and Liabilities Measured at Fair Value as of December 31, 2024 Level 1 Level 2 Level 3 (1) Total (in thousands) Recurring: Assets: Investment Securities: Available-for-sale: Auction-rate certificates backed by Government guaranteed student loans $ — $ — $ 19,476 $ 19,476 Government/GSE guaranteed mortgage-backed securities — 4,643,692 — 4,643,692 U.S. Treasuries 1,289,846 — — 1,289,846 AgVantage — — 5,505,531 5,505,531 Interest-Only Farmer Mac Guaranteed Securities — — 9,015 9,015 Total Available-for-sale Investment Securities 1,289,846 4,643,692 5,534,022 11,467,560 Loans: Loans held for sale, at lower of cost or fair value — 6,160 — 6,160 Total Loans — 6,160 — 6,160 Financial derivatives 47 27,742 — 27,789 Other Assets (2) — — 5,382 5,382 Total Assets at fair value $ 1,289,893 $ 4,677,594 $ 5,539,404 $ 11,506,891 Liabilities: Financial derivatives $ — $ 77,326 $ — $ 77,326 Total Liabilities at fair value $ — $ 77,326 $ — $ 77,326 (1) Level 3 assets represent 18 % of total assets and 48 % of financial instruments measured at fair value. (2) Represents a retained beneficial interest related to transfers of financial assets. 144 There were no material assets or liabilities measured at fair value on a non-recurring basis as of December 31, 2025 or 2024. 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 years ended December 31, 2025 and 2024, 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 years ended December 31, 2025, 2024, and 2023. Table 11.2 Level 3 Assets and Liabilities Measured at Fair Value for the Year Ended December 31, 2025 Beginning Balance Purchases Sales Settlements Allowance for Losses Realized and unrealized (losses)/gains included in Income Unrealized gains/(losses) included in Other Comprehensive Income Ending Balance (in thousands) Recurring: Assets: Investment Securities: Available-for-sale: Auction-rate certificates backed by Government guaranteed student loans $ 19,476 $ — $ ( 19,537 ) $ — $ 27 $ ( 163 ) $ 197 $ — AgVantage 5,505,531 2,013,475 — ( 923,198 ) 106 130,539 4,464 6,730,917 Interest-Only Farmer Mac Guaranteed Securities 9,015 — — ( 670 ) — — ( 142 ) 8,203 Total available-for-sale 5,534,022 2,013,475 ( 19,537 ) ( 923,868 ) 133 130,376 4,519 6,739,120 Other Assets 5,382 — — ( 341 ) — ( 144 ) — 4,897 Total Assets at fair value $ 5,539,404 $ 2,013,475 $ ( 19,537 ) $ ( 924,209 ) $ 133 $ 130,232 $ 4,519 $ 6,744,017 145 Level 3 Assets and Liabilities Measured at Fair Value for the Year Ended December 31, 2024 Beginning Balance Purchases Settlements Allowance for Losses Realized and unrealized losses included in Income Unrealized gains/(losses) included in Other Comprehensive Income Ending Balance (in thousands) Recurring: Assets: Investment Securities: Available-for-sale: Auction-rate certificates backed by Government guaranteed student loans $ 19,082 $ — $ — $ — $ — $ 394 $ 19,476 AgVantage 5,522,712 677,400 ( 666,476 ) 81 ( 49,727 ) 21,541 5,505,531 Interest-Only Farmer Mac Guaranteed Securities 9,767 — ( 699 ) — — ( 53 ) 9,015 Total available-for-sale 5,551,561 677,400 ( 667,175 ) 81 ( 49,727 ) 21,882 5,534,022 Other Assets 5,831 — ( 343 ) — ( 106 ) — 5,382 Total Assets at fair value $ 5,557,392 $ 677,400 $ ( 667,518 ) $ 81 $ ( 49,833 ) $ 21,882 $ 5,539,404 Level 3 Assets and Liabilities Measured at Fair Value for the Year Ended December 31, 2023 Beginning Balance Purchases Settlements Allowance for Losses Realized and unrealized gains included in Income Unrealized gains/(losses) included in Other Comprehensive Income Transfers Out (1) Ending Balance (in thousands) Recurring: Assets: Investment Securities: Available-for-sale: Auction-rate certificates backed by Government guaranteed student loans $ 19,027 $ — $ — $ 6 $ — $ 49 $ — $ 19,082 AgVantage 7,599,379 2,084,650 ( 1,561,507 ) 230 89,629 ( 5,573 ) ( 2,684,096 ) 5,522,712 Interest-Only Farmer Mac Guaranteed Securities 7,847 — ( 1,213 ) — — 3,133 — 9,767 Total available-for-sale 7,626,253 2,084,650 ( 1,562,720 ) 236 89,629 ( 2,391 ) ( 2,684,096 ) 5,551,561 Other Assets 4,467 — ( 590 ) — 1,954 — — 5,831 Total Assets at fair value $ 7,630,720 $ 2,084,650 $ ( 1,563,310 ) $ 236 $ 91,583 $ ( 2,391 ) $ ( 2,684,096 ) $ 5,557,392 (1) Includes $ 2.7 billion of AgVantage securities transferred from available-for-sale to held-to-maturity on July 1, 2023. 146 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 December 31, 2025 and 2024: Table 11.3 As of December 31, 2025 Financial Instruments Fair Value Valuation Technique Unobservable Input Range (Weighted-Average) (in thousands) Assets: Investment securities: AgVantage $ 6,730,917 Discounted cash flow Discount rate 4.3 % - 4.9 % ( 4.5 %) Interest-Only Farmer Mac Guaranteed Securities $ 8,203 Discounted cash flow Discount rate 7.8 % CPR 3 % Other Assets $ 4,897 Discounted cash flow Discount rate 7.8 % CPR 3 % As of December 31, 2024 Financial Instruments Fair Value Valuation Technique Unobservable Input Range (Weighted-Average) (in thousands) Assets: Investment securities: Auction-rate certificates backed by Government guaranteed student loans $ 19,476 Indicative bids Range of broker quotes 99.0 % - 99.0 % ( 99.0 %) AgVantage $ 5,505,531 Discounted cash flow Discount rate 5.0 % - 5.5 % ( 5.1 %) Interest-Only Farmer Mac Guaranteed Securities $ 9,015 Discounted cash flow Discount rate 7.9 % CPR 3 % Other Assets $ 5,382 Discounted cash flow Discount rate 7.9 % CPR 3 % The significant unobservable input used in the fair value measurements of AgVantage securities is the discount rate commensurate with the risks involved. Typically, significant increases (decreases) in this input in isolation may result in materially lower (higher) fair value measurements. Generally, in a rising interest rate environment, Farmer Mac would expect average discount rates to increase. Conversely, in a declining interest rate environment, Farmer Mac would expect average discount rates to decrease. CPR are not presented in the table above for AgVantage securities because they generally have fixed maturity dates when the secured general obligations are due and do not prepay. 147 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 December 31, 2025 and 2024: Table 11.4 As of December 31, 2025 As of December 31, 2024 Fair Value Carrying Amount Fair Value Carrying Amount (in thousands) Financial assets: Cash and cash equivalents $ 931,067 $ 931,067 $ 1,024,007 $ 1,024,007 Investment securities 17,390,108 17,550,379 16,302,559 16,576,887 Loans 16,342,149 16,321,276 12,924,604 13,204,638 Financial derivatives 44,875 44,875 27,789 27,789 Guarantee and commitment fees receivable 63,677 57,214 57,562 50,499 Financial liabilities: Notes payable 30,489,417 30,822,570 26,759,873 27,371,174 Debt securities of consolidated trusts held by third parties 2,420,149 2,365,435 1,910,302 1,929,628 Financial derivatives 21,618 21,618 77,326 77,326 Guarantee and commitment obligations 61,234 54,770 55,388 48,326 The carrying value of cash and cash equivalents is a reasonable estimate of their approximate fair value and is classified as Level 1. The fair value of investments in U.S. Treasuries are valued based on unadjusted quoted prices in active markets and are classified as Level 1. A significant portion of Farmer Mac's investment portfolio is valued using a reputable nationally recognized third-party pricing service. The prices obtained are non-binding and generally representative of recent market trades and are classified as Level 2. Farmer Mac internally models the fair value of its portfolio assets; including loans held for investment and loans held for investment in consolidated trusts, Farmer Mac Guaranteed Securities, and USDA Securities by discounting the projected cash flows of these instruments at projected interest rates. The fair values are based on the present value of expected cash flows using management's best estimate of certain key assumptions, which include prepayment speeds, forward yield curves and discount rates commensurate with the risks involved. These fair value measurements do not take into consideration the fair value of the underlying property and are classified as Level 3. Level 3 Farmer Mac Guaranteed Securities include our AgVantage securities for which we apply a discount rate in calculating the net present value of future expected cash flows that is both significant to the estimate of their fair value and unobservable in the market. We rely upon this significant unobservable input to estimate the fair value of AgVantage because there are no observable transactions in these securities in the market. 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 148 these instruments using a yield curve derived from market prices observed for similar agency securities and are also classified as Level 3. Because the cash flows of Farmer Mac's financial instruments may be interest rate path dependent, estimated fair values and projected discount rates for Level 3 financial instruments are derived using a Monte Carlo simulation model. Different market assumptions and estimation methodologies could significantly affect estimated fair value amounts. 12. BUSINESS SEGMENT REPORTING Farmer Mac has seven reportable segments: Farm & Ranch, Corporate AgFinance, Power & Utilities, Broadband Infrastructure, Renewable Energy, Funding, and Investments. The Farm & Ranch segment includes the financial results of the USDA Securities portfolio, Farm & Ranch loans, and AgVantage securities secured by Farm & Ranch loans. The Corporate AgFinance segment includes loans and AgVantage securities to larger and more complex farming operations, agribusinesses focused on food and fiber processing, and other supply chain production. The Power & Utilities segment includes loans to rural electric generation and transmission cooperatives and distribution cooperatives, as well as AgVantage securities secured by those types of loans. The Broadband Infrastructure segment includes loans to rural fiber, cable/broadband, tower, wireless, local exchange carrier, and data center projects. The Renewable Energy segment includes rural electric solar, wind, and gas projects. The Funding segment includes the financial results of Farmer Mac's debt issuance, hedging, asset/liability management, and capital allocation strategies. Farmer Mac allocates interest expense to each of the other segments using a funds transfer pricing process. The Funding segment reflects the benefits and costs from the execution of Farmer Mac's funding and hedging strategies. The Investments segment includes the financial results of Farmer Mac's investment portfolio, which is held for liquidity purposes. Interest expense is allocated to the Investments segment using the same funds transfer pricing process that is used to allocate interest expense to the other segments. The following table presents Farmer Mac's seven segments: Agricultural Finance Infrastructure Finance Treasury Farm & Ranch Corporate AgFinance Power & Utilities Broadband Infrastructure Renewable Energy Funding Investments The Chief Executive Officer serves as the Chief Operating Decision Maker ("CODM"). The CODM reviews segment core earnings to make decisions about allocating resources and to assess the financial performance of the segments. The main difference between core earnings and net income is the exclusion of the effects of fair value fluctuations. These fluctuations are not expected to have a cumulative net impact on Farmer Mac's financial condition or results of operations reported in accordance with GAAP if the related financial instruments are held to maturity, as is expected. Another difference is that core earnings excludes specified infrequent or unusual transactions that are not indicative of future operating results and that may not reflect the trends and economic financial performance of Farmer Mac's core business. The CODM also looks at changes in the segments' on- and off-balance sheet unpaid principal balances to assess the performance of the segments. 149 The following tables present segment core earnings and assets for the years ended December 31, 2025, 2024, and 2023. Table 12.1 Core Earnings by Business Segment For the Year Ended December 31, 2025 Agricultural Finance Infrastructure Finance Treasury Farm & Ranch Corporate AgFinance Power & Utilities Broadband Infrastructure Renewable Energy Funding Investments Total (in thousands) Interest income $ 614,331 $ 102,439 $ 273,500 $ 52,109 $ 104,276 $ 137,024 $ 328,568 $ 1,612,247 Interest expense (1) ( 469,656 ) ( 67,542 ) ( 250,362 ) ( 34,622 ) ( 76,212 ) ( 1,523 ) ( 321,596 ) ( 1,221,513 ) Less: reconciling adjustments (2)(3) ( 4,060 ) — ( 104 ) — — ( 3,758 ) 229 ( 7,693 ) Net effective spread 140,615 34,897 23,034 17,487 28,064 131,743 7,201 383,041 Guarantee and commitment fees (3) 18,224 917 850 2,452 1,349 — — 23,792 Other income/(expense) 1,849 440 ( 7 ) — 8 — ( 128 ) 2,162 (Provision for)/release of losses ( 8,619 ) ( 15,325 ) 84 ( 5,505 ) ( 3,574 ) — 26 ( 32,913 ) Operating expenses (1) ( 27,664 ) ( 10,372 ) ( 4,575 ) ( 5,103 ) ( 6,633 ) ( 11,644 ) ( 3,370 ) ( 69,361 ) Income tax expense ( 26,120 ) ( 2,220 ) ( 4,069 ) ( 1,960 ) ( 4,035 ) ( 25,222 ) ( 784 ) ( 64,410 ) Segment core earnings $ 98,285 $ 8,337 $ 15,317 $ 7,371 $ 15,179 $ 94,877 $ 2,945 $ 242,311 Reconciliation to net income: Net effects of derivatives and trading securities $ ( 679 ) Unallocated (expenses)/income ( 50,331 ) Income tax effect related to reconciling items 16,114 Net income $ 207,415 Total Assets: Total on- and off-balance sheet segment assets at principal balance $ 19,564,916 $ 1,950,536 $ 7,860,622 $ 1,532,206 $ 2,443,289 $ — $ — $ 33,351,569 Off-balance sheet assets under management ( 5,765,446 ) Unallocated assets 7,784,034 Total assets on the Consolidated Balance Sheets $ 35,370,157 (1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. (2) Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "(Losses)/gains on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships. (3) 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. 150 Core Earnings by Business Segment For the Year Ended December 31, 2024 Agricultural Finance Infrastructure Finance Treasury Farm & Ranch Corporate AgFinance Power & Utilities Broadband Infrastructure Renewable Energy Funding Investments Total (in thousands) Interest income $ 615,016 $ 100,820 $ 260,636 $ 38,225 $ 54,188 $ 224,390 $ 310,241 $ 1,603,516 Interest expense (1) ( 475,248 ) ( 70,695 ) ( 240,600 ) ( 27,282 ) ( 40,471 ) ( 89,698 ) ( 305,655 ) ( 1,249,649 ) Less: reconciling adjustments (2)(3) ( 4,458 ) — ( 49 ) — — ( 9,796 ) — ( 14,303 ) Net effective spread 135,310 30,125 19,987 10,943 13,717 124,896 4,586 339,564 Guarantee and commitment fees (3) 17,695 571 966 464 625 — — 20,321 Other income/(expense) 3,167 ( 2,055 ) — — — — 1,076 2,188 (Provision for)/release of losses ( 1,147 ) ( 6,850 ) 274 1,469 ( 5,236 ) — — ( 11,490 ) Operating expenses (1) ( 24,741 ) ( 7,905 ) ( 4,281 ) ( 3,666 ) ( 4,848 ) ( 10,855 ) ( 3,108 ) ( 59,404 ) Income tax expense ( 27,360 ) ( 2,916 ) ( 3,559 ) ( 1,934 ) ( 894 ) ( 23,949 ) ( 536 ) ( 61,148 ) Segment core earnings $ 102,924 $ 10,970 $ 13,387 $ 7,276 $ 3,364 $ 90,092 $ 2,018 $ 230,031 Reconciliation to net income: Net effects of derivatives and trading securities $ 13,141 Unallocated (expense)/income ( 46,217 ) Income tax effect related to reconciling items 10,238 Net income $ 207,193 Total Assets: Total on- and off-balance sheet segment assets at principal balance $ 18,606,968 $ 1,887,705 $ 6,809,366 $ 802,466 $ 1,416,525 $ — $ — $ 29,523,030 Off-balance sheet assets under management ( 4,981,285 ) Unallocated assets 6,782,997 Total assets on the Consolidated Balance Sheets $ 31,324,742 (1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. (2) Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "(Losses)/gains on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships. (3) 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. 151 Core Earnings by Business Segment For the Year Ended December 31, 2023 Agricultural Finance Infrastructure Finance Treasury Farm & Ranch Corporate AgFinance Power & Utilities Broadband Infrastructure Renewable Energy Funding Investments Total (in thousands) Interest income $ 559,730 $ 92,335 $ 232,106 $ 30,299 $ 18,923 $ 200,264 $ 258,631 $ 1,392,288 Interest expense (1) ( 422,651 ) ( 61,111 ) ( 215,763 ) ( 21,455 ) ( 14,275 ) ( 71,849 ) ( 257,637 ) ( 1,064,741 ) Less: reconciling adjustments (2)(3) ( 4,179 ) — ( 168 ) — — 3,594 186 ( 567 ) Net effective spread 132,900 31,224 16,175 8,844 4,648 132,009 1,180 326,980 Guarantee and commitment fees (3) 17,415 283 1,090 43 97 — — 18,928 Other income 2,952 35 — — — 3 29 3,019 (Provision for)/release of losses ( 507 ) ( 207 ) 4,117 ( 4,324 ) ( 219 ) — 4 ( 1,136 ) Operating expenses (1) ( 23,306 ) ( 5,540 ) ( 3,553 ) ( 2,415 ) ( 3,382 ) ( 11,037 ) ( 3,184 ) ( 52,417 ) Income tax (expense)/benefit ( 27,183 ) ( 5,418 ) ( 3,746 ) ( 453 ) ( 238 ) ( 25,405 ) 414 ( 62,029 ) Segment core earnings $ 102,271 $ 20,377 $ 14,083 $ 1,695 $ 906 $ 95,570 $ ( 1,557 ) $ 233,345 Reconciliation to net income: Net effects of derivatives and trading securities $ 1,954 Unallocated (expense)/income ( 44,227 ) Income tax effect related to reconciling items 8,931 Net income $ 200,003 Total Assets: Total on- and off-balance sheet segment assets at principal balance $ 18,808,801 $ 1,693,979 $ 6,979,570 $ 501,153 $ 487,521 $ — $ — $ 28,471,024 Off-balance sheet assets under management ( 4,710,199 ) Unallocated assets 5,763,557 Total assets on the Consolidated Balance Sheets $ 29,524,382 (1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. (2) Includes the amortization of premiums and discounts on assets consolidated at fair value, originally included in interest income, to reflect core earnings amounts; the reclassification of interest expense related to interest rate swaps not designated as hedges, which are included in "(Losses)/gains on financial derivatives" on the consolidated financial statements, to determine the effective funding cost for each operating segment; and excludes the fair value changes of financial derivatives and the corresponding assets or liabilities designated in fair value hedge accounting relationships. (3) 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. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.