Document and Entity Information
Document and Entity Information | 12 Months Ended |
May 31, 2020USD ($)shares | |
Document and Entity Information | |
Entity Registrant Name | NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORP /DC/ |
Entity Central Index Key | 0000070502 |
Document Type | 10-K |
Document Period End Date | May 31, 2020 |
Amendment Flag | false |
Current Fiscal Year End Date | --05-31 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Public Float | $ | $ 0 |
Entity Common Stock, Shares Outstanding | shares | 0 |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Interactive Data Current | Yes |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |||
May 31, 2020 | May 31, 2019 | May 31, 2018 | ||
Income Statement [Abstract] | ||||
Interest income | $ 1,151,286 | $ 1,135,670 | $ 1,077,357 | |
Interest expense | [1],[2] | (821,089) | (836,209) | (792,735) |
Net interest income | 330,197 | 299,461 | 284,622 | |
Benefit (provision) for loan losses | (35,590) | 1,266 | 18,575 | |
Net interest income after benefit (provision) for loan losses | 294,607 | 300,727 | 303,197 | |
Non-interest income: | ||||
Fee and other income | 22,961 | 15,355 | 17,578 | |
Derivative gains (losses) | (790,151) | (363,341) | 231,721 | |
Investment securities losses | 9,431 | (1,799) | 0 | |
Total non-interest income | (757,759) | (349,785) | 249,299 | |
Non-interest expense: | ||||
Salaries and employee benefits | (54,522) | (49,824) | (51,422) | |
Other general and administrative expenses | (46,645) | (43,342) | (39,462) | |
Losses on early extinguishment of debt | (683) | (7,100) | 0 | |
Other non-interest expense | (25,588) | (1,675) | (1,943) | |
Total non-interest expense | (127,438) | (101,941) | (92,827) | |
Income (loss) before income taxes | (590,590) | (150,999) | 459,669 | |
Income tax benefit (expense) | 1,160 | (211) | (2,305) | |
Net income (loss) | (589,430) | (151,210) | 457,364 | |
Less: Net (income) loss attributable to noncontrolling interests | 4,190 | 1,979 | (2,178) | |
Net income (loss) attributable to CFC | $ (585,240) | $ (149,231) | $ 455,186 | |
[1] | (1) Includes amortization of debt discounts and debt issuance costs, which are generally deferred and recognized as interest expense using the effective interest method. Issuance costs related to dealer commercial paper, however, are recognized as interest expense immediately as incurred. | |||
[2] | (2) Includes fees related to funding arrangements, such as up-front fees paid to banks participating in our committed bank revolving line of credit agreements. Depending on the nature of the fee, amounts may be deferred and recognized as interest expense ratably over the term of the arrangement or recognized immediately as incurred. |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Net income (loss) | $ (589,430) | $ (151,210) | $ 457,364 |
Other comprehensive income (loss): | |||
Unrealized losses on equity securities | 0 | 0 | (3,222) |
Unrealized gains (losses) on cash flow hedges | 0 | 1,059 | (1,059) |
Reclassification of derivative gains to net income | (441) | (468) | (663) |
Defined benefit plan adjustments | (1,322) | (488) | 313 |
Other comprehensive income (loss) | (1,763) | 103 | (4,631) |
Total comprehensive income (loss) | (591,193) | (151,107) | 452,733 |
Less: Total comprehensive (income) loss attributable to noncontrolling interests | 4,190 | 1,979 | (2,178) |
Total comprehensive income (loss) attributable to CFC | $ (587,003) | $ (149,128) | $ 450,555 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Assets: | |||
Cash and cash equivalents | $ 671,372 | $ 177,922 | |
Restricted cash | 8,647 | 8,282 | |
Total cash, cash equivalents and restricted cash | 680,019 | 186,204 | |
Investment securities: | |||
Equity securities | 60,735 | 87,533 | |
Debt securities trading, at fair value | 309,400 | 0 | |
Debt securities held-to-maturity, at amortized cost | 0 | 565,444 | |
Total investment securities | 370,135 | 652,977 | |
Loans to members | 26,702,380 | 25,916,904 | [1] |
Less: Allowance for loan losses | (53,125) | (17,535) | |
Loans to members, net | 26,649,255 | 25,899,369 | |
Accrued interest receivable | 117,138 | 133,605 | |
Other receivables | 41,099 | 36,712 | |
Fixed assets, net | 89,137 | 120,627 | |
Derivative assets | 173,195 | 41,179 | |
Other assets | 37,627 | 53,699 | |
Total assets | 28,157,605 | 27,124,372 | |
Liabilities: | |||
Accrued interest payable | 139,619 | 158,997 | |
Total debt outstanding | |||
Short-term borrowings | 3,961,985 | 3,607,726 | |
Long-term debt | 19,712,024 | 19,210,793 | |
Subordinated deferrable debt | 986,119 | 986,020 | |
Members’ subordinated certificates: | |||
Membership subordinated certificates | 630,483 | 630,474 | |
Loan and guarantee subordinated certificates | 482,965 | 505,485 | |
Member capital securities | 226,170 | 221,170 | |
Total members’ subordinated certificates | 1,339,618 | 1,357,129 | |
Total debt outstanding | 25,999,746 | 25,161,668 | |
Deferred income | 59,303 | 57,989 | |
Derivative liabilities | 1,258,459 | 391,724 | |
Other liabilities | 51,656 | 50,112 | |
Total liabilities | 27,508,783 | 25,820,490 | |
CFC equity: | |||
Retained equity | 628,031 | 1,276,882 | |
Accumulated other comprehensive income | (1,910) | (147) | |
Total CFC equity | 626,121 | 1,276,735 | |
Noncontrolling interests | 22,701 | 27,147 | |
Total equity | 648,822 | 1,303,882 | |
Total liabilities and equity | $ 28,157,605 | $ 27,124,372 | |
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Noncontrolling interests | Total CFC equity | Accumulated other comprehensive income | CFC retained equity | Unallocated Net Income (Loss) | Members' capital reserve | Patronage Capital Allocated | Membership Fees and Education Fund |
Balance at May. 31, 2017 | $ 1,098,805 | $ 28,852 | $ 1,069,953 | $ 13,175 | $ 1,056,778 | $ (338,128) | $ 630,305 | $ 761,701 | $ 2,900 |
Net income (loss) | 457,364 | 2,178 | 455,186 | 455,186 | 301,694 | 57,480 | 95,012 | 1,000 | |
Other comprehensive income (loss) | (4,631) | (4,631) | (4,631) | ||||||
Patronage capital retirement | (45,220) | (45,220) | (45,220) | (45,220) | |||||
Other | (465) | 490 | (955) | (955) | (955) | ||||
Balance at May. 31, 2018 | 1,505,853 | 31,520 | 1,474,333 | 8,544 | 1,465,789 | (36,434) | 687,785 | 811,493 | 2,945 |
Cumulative effect from adoption of new accounting standard | Cumulative effect from adoption of new accounting standard | 1,505,853 | 31,520 | 1,474,333 | (250) | 1,474,583 | (27,640) | 687,785 | 811,493 | 2,945 |
Net income (loss) | (151,210) | (1,979) | (149,231) | (149,231) | (318,135) | 71,312 | 96,592 | 1,000 | |
Other comprehensive income (loss) | 103 | 103 | 103 | ||||||
Patronage capital retirement | (50,415) | (2,908) | (47,507) | (47,507) | (47,507) | ||||
Other | (449) | 514 | (963) | (963) | (963) | ||||
Balance at May. 31, 2019 | 1,303,882 | 27,147 | 1,276,735 | (147) | 1,276,882 | (345,775) | 759,097 | 860,578 | 2,982 |
Balance (Cumulative effect from adoption of new accounting standard) at May. 31, 2019 | (8,794) | 8,794 | 8,794 | ||||||
Net income (loss) | (589,430) | (4,190) | (585,240) | (585,240) | (730,773) | 48,223 | 96,310 | 1,000 | |
Other comprehensive income (loss) | (1,763) | (1,763) | (1,763) | ||||||
Patronage capital retirement | (64,755) | (1,933) | (62,822) | (62,822) | (62,822) | ||||
Other | 888 | 1,677 | (789) | (789) | (789) | ||||
Balance at May. 31, 2020 | $ 648,822 | $ 22,701 | $ 626,121 | $ (1,910) | $ 628,031 | $ (1,076,548) | $ 807,320 | $ 894,066 | $ 3,193 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (589,430) | $ (151,210) | $ 457,364 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Amortization of deferred loan fees | (9,309) | (10,009) | (11,296) |
Amortization of debt issuance costs and deferred charges | 9,095 | 10,439 | 10,456 |
Amortization of discount on long-term debt | 10,896 | 10,605 | 10,164 |
Amortization of issuance costs for bank revolving lines of credit | 4,972 | 5,324 | 5,346 |
Depreciation and amortization | 9,238 | 9,305 | 7,931 |
Provision (benefit) for loan losses | 35,590 | (1,266) | (18,575) |
Loss on early extinguishment of debt | 683 | 7,100 | 0 |
Fixed assets impairment | 31,284 | 0 | 0 |
Gain on sale of land | (7,713) | 0 | 0 |
Investment securities unrealized (gains) losses | (5,975) | 1,799 | 0 |
Derivative forward value (gains) losses | 734,278 | 319,730 | (306,002) |
Changes in operating assets and liabilities: | |||
Accrued interest receivable | 16,467 | (6,163) | (15,949) |
Accrued interest payable | (19,378) | 9,713 | 11,808 |
Deferred income | 10,973 | 2,077 | 3,246 |
Other | (12,456) | (10,401) | 741 |
Net cash provided by operating activities | 219,215 | 197,043 | 155,234 |
Cash flows from investing activities: | |||
Advances on loans, net | (785,190) | (738,171) | (811,164) |
Investment in fixed assets | (9,565) | (14,725) | (15,194) |
Proceeds from sale of land | 21,268 | 0 | 0 |
Net proceeds from time deposits | 0 | (100,000) | (125,000) |
Purchase of trading securities | (3,883) | 0 | 0 |
Proceeds from sales and maturities of trading securities | 277,687 | ||
Proceeds from redemption of equity securities | 25,000 | 0 | 0 |
Purchases of held-to-maturity investments | (76,339) | (80,123) | (510,598) |
Proceeds from maturities of held-to-maturity investments | 69,726 | 35,340 | 1,394 |
Net cash used by investing activities | (481,296) | (697,679) | (1,210,562) |
Cash flows from financing activities: | |||
Proceeds from (repayments of) short-term borrowings, net | (208,340) | (452,618) | 126,211 |
Proceeds from short-term borrowings with original maturity greater than 90 days | 3,022,910 | 1,652,005 | 1,331,910 |
Repayments of short term-borrowings with original maturity greater than 90 days | (2,460,311) | (1,387,571) | (1,005,111) |
Payments for issuance costs for revolving bank lines of credit | (1,025) | (2,382) | (2,441) |
Proceeds from issuance of long-term debt, net of discount and issuance costs | 2,156,711 | 3,281,595 | 2,349,885 |
Payments for retirement of long-term debt | (1,675,288) | (2,806,639) | (1,611,002) |
Payments made for early extinguishment of debt | (683) | (7,100) | 0 |
Payments for issuance costs for subordinated deferrable debt | (84) | (6,535) | 0 |
Proceeds from issuance of subordinated debt | 0 | 250,000 | 0 |
Proceeds from issuance of members’ subordinated certificates | 9,621 | 1,986 | 6,136 |
Payments for retirement of members’ subordinated certificates | (24,572) | (24,861) | (45,180) |
Payments for retirement of patronage capital | (63,035) | (49,860) | (44,667) |
Repayments for membership fees, net | (8) | (4) | (10) |
Net cash provided by financing activities | 755,896 | 448,016 | 1,105,731 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 493,815 | (52,620) | 50,403 |
Beginning cash, cash equivalents and restricted cash | 186,204 | 238,824 | 188,421 |
Ending cash, cash equivalents and restricted cash | 680,019 | 186,204 | 238,824 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 805,086 | 801,966 | 766,059 |
Cash paid for income taxes | 20 | $ 112 | $ 321 |
Net decrease in debt service reserve funds/debt service reserve certificates | $ 2,560 |
Summary of Significant Accounti
Summary of Significant Accounting Policies (Notes) | 12 Months Ended |
May 31, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company National Rural Utilities Cooperative Finance Corporation (“CFC”) is a member-owned cooperative association incorporated under the laws of the District of Columbia in April 1969. CFC’s principal purpose is to provide its members with financing to supplement the loan programs of the Rural Utilities Service (“RUS”) of the United States Department of Agriculture (“USDA”). CFC makes loans to its rural electric members so they can acquire, construct and operate electric distribution systems, generation and transmission (“power supply”) systems and related facilities. CFC also provides its members with credit enhancements in the form of letters of credit and guarantees of debt obligations. As a cooperative, CFC is owned by and exclusively serves its membership, which consists of not-for-profit entities or subsidiaries or affiliates of not-for-profit entities. CFC is exempt from federal income taxes. National Cooperative Services Corporation (“NCSC”) is a taxable cooperative incorporated in 1981 in the District of Columbia as a member-owned cooperative association. NCSC’s principal purpose is to provide financing to members of CFC, entities eligible to be members of CFC and the for-profit and nonprofit entities that are owned, operated or controlled by or provide significant benefit to certain members of CFC. NCSC’s membership consists of distribution systems, power supply systems and statewide and regional associations that are members of CFC. CFC is the primary source of funding for NCSC and manages NCSC’s business operations under a management agreement that is automatically renewable on an annual basis unless terminated by either party. NCSC pays CFC a fee and, in exchange, CFC reimburses NCSC for loan losses under a guarantee agreement. As a taxable cooperative, NCSC pays income tax based on its reported taxable income and deductions. NCSC is headquartered with CFC in Dulles, Virginia. Rural Telephone Finance Cooperative (“RTFC”) is a taxable Subchapter T cooperative association originally incorporated in South Dakota in 1987 and reincorporated as a member-owned cooperative association in the District of Columbia in 2005. RTFC’s principal purpose is to provide financing for its rural telecommunications members and their affiliates. RTFC’s membership consists of a combination of not-for-profit and for-profit entities. CFC is the sole lender to and manages the business operations of RTFC through a management agreement that is automatically renewable on an annual basis unless terminated by either party. RTFC pays CFC a fee and, in exchange, CFC reimburses RTFC for loan losses under a guarantee agreement. As permitted under Subchapter T of the Internal Revenue Code, RTFC pays income tax based on its net income, excluding patronage-sourced earnings allocated to its patrons. RTFC is headquartered with CFC in Dulles, Virginia. Basis of Presentation and Use of Estimates The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and related disclosures during the period. Management's most significant estimates and assumptions involve determining the allowance for loan losses and the fair value of financial assets and liabilities. Actual results could differ from these estimates. Certain reclassifications have been made to prior periods to conform to the current presentation. Risks and Uncertainties We have considered the impact of the emergence in 2019 and continued spread of a novel strain of coronavirus that causes coronavirus disease 2019 (“COVID-19”), which was declared a global pandemic by the World Health Organization (“WHO”) in March 2020, on our consolidated financial statements. Although the effects of COVID-19 and the response to the virus have negatively impacted financial markets and overall economic conditions, we have been able to navigate the challenges of the pandemic reasonably well. We have been monitoring developments closely, and the future impact of COVID-19 on our operations is highly uncertain and cannot be predicted. The extent of the impact of COVID-19 on our operational and financial performance will depend on certain developments, including, among others, the duration and severity of the COVID-19 pandemic, the ultimate impact on our members, potential further disruption and deterioration in the corporate debt markets and additional, or extended, federal, state and local government orders and regulations that might be imposed in response to the pandemic, all of which are uncertain. Principles of Consolidation The accompanying consolidated financial statements include the accounts of CFC, variable interest entities (“VIEs”) where CFC is the primary beneficiary and subsidiary entities created and controlled by CFC to hold foreclosed assets. CFC did no t have any entities that held foreclosed assets as of May 31, 2020 or May 31, 2019 . All intercompany balances and transactions have been eliminated. NCSC and RTFC are VIEs that are required to be consolidated by CFC. Unless stated otherwise, references to “we, “our” or “us” relate to CFC and its consolidated entities. Variable Interest Entities A VIE is an entity that has a total equity investment at risk that is not sufficient to finance its activities without additional subordinated financial support provided by another party, or where the group of equity holders does not have: (i) the ability to make decisions about the entity’s activities that most significantly impact its economic performance; (ii) the obligation to absorb the entity’s expected losses; or (iii) the right to receive the entity’s expected residual returns. NCSC and RTFC meet the definition of VIEs because they do not have sufficient equity investment at risk to finance their activities without additional financial support. When evaluating an entity for possible consolidation, we must determine whether or not we have a variable interest in the entity. If it is determined that we do not have a variable interest in the entity, no further analysis is required and we do not consolidate the entity. If we have a variable interest in the entity, we must evaluate whether we are the primary beneficiary based on an assessment of quantitative and qualitative factors. We are considered the primary beneficiary holder if we have a controlling financial interest in the VIE that provides (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. We consolidate the results of NCSC and RTFC with CFC because CFC is the primary beneficiary holder. Cash and Cash Equivalents Cash, certificates of deposit, due from banks and other investments with original maturities of less than 90 days are classified as cash and cash equivalents. Restricted Cash Restricted cash, which consists primarily of member funds held in escrow for certain specifically designed cooperative programs, totaled $9 million and $8 million as of May 31, 2020 and 2019 , respectively. Investment Securities We currently hold investments in equity and debt securities. We record purchases and sales of securities on a trade-date basis. The accounting and measurement framework for investment securities differs depending on the security type and the classification. Our equity securities consist of investments in Federal Agricultural Mortgage Corporation (“Farmer Mac”) Series A common stock and Farmer Mac Series A and Series C non-cumulative preferred stock. We previously had investments in equity securities that were classified as available for sale as of May 31, 2018. The unrealized gains and losses on these securities were recorded in other comprehensive income. Effective with our June 1, 2018 adoption of the financial instrument accounting standard on the recognition and measurement of financial assets and financial liabilities, unrealized gains and losses on equity securities are required to be recorded in earnings. Equity securities are carried at fair value on our consolidated balance sheets with unrealized gains and losses recorded as a component of other non-interest income. Our debt securities consist of investments in certificates of deposit with maturities greater than 90 days, corporate debt securities, municipality debt securities, commercial mortgage-backed securities (“MBS”) and other asset-backed securities (“ABS”). We currently classify and account for our investments in debt securities as trading. We previously had investments in debt securities that were classified as held to maturity as of May 31, 2019. During the fourth quarter of fiscal year 2020, in light of the extreme volatility and disruptions in the capital and credit markets in early March 2020 resulting from the COVID-19 crisis, we transferred the debt securities in our held-to-maturity investment portfolio to trading, as we revised our objective for the use of our held-to-maturity investment portfolio from previously serving as a supplemental source of liquidity to serving as a readily available source of liquidity. In conjunction with the transfer, recognized an unrealized gain of $1 million in earnings. We report debt securities classified as trading on our consolidated balance sheets at fair value with unrealized gains and losses recorded as a component of other non-interest income. Interest income is generally recognized over the contractual life of the securities based on the effective yield method. Loans to Members Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are considered as held for investment. Loans held for investment are carried at the outstanding unpaid principal balance, net of unamortized loan origination costs. We classify and account for loans to members as held for investment. Deferred loan origination costs are amortized using the straight-line method, which approximates the effective interest method, into interest income over the life of the loan. Nonperforming Loans A loan is considered past due if a full payment of interest and principal is not received within 30 days of its due date. Loans are classified as nonperforming when the collection of interest and principal has become 90 days past due; court proceedings indicate that collection of interest and principal in accordance with the contractual terms is unlikely; or the full and timely collection of interest or principal becomes otherwise due. Once a loan is classified as nonperforming, we typically place the loan on nonaccrual status and reverse any accrued and unpaid interest recorded during the period in which the loan is classified as nonperforming. We generally apply all cash received during the nonaccrual period to the reduction of principal, thereby foregoing interest income recognition. The decision to return a loan to accrual status is determined on a case-by-case basis. We fully charge off or write down loans to the estimated net realizable value in the period that it becomes evident that collectability of the full contractual amount is highly unlikely; however, our efforts to recover all charged-off amounts may continue. The determination to write off all or a portion of a loan balance is made based on various factors on a case-by-case basis including, but not limited to, cash flow analysis and the fair value of collateral securing the borrower’s loans. Impaired Loans A loan is considered impaired when, based on current information and events, we determine that it is probable that we will be unable to collect all interest and principal amounts due as scheduled in accordance with the contractual terms of the loan agreement, other than an insignificant delay in payment or insignificant shortfall in payment amount. Factors considered in determining impairment may include, but are not limited to: • the review of the borrower’s audited financial statements and interim financial statements if available, • the borrower’s payment history, • communication with the borrower, • economic conditions in the borrower’s service territory, • pending legal action involving the borrower, • restructure agreements between us and the borrower, and • estimates of the value of the borrower’s assets that have been pledged as collateral to secure our loans. We recognize interest income on impaired loans on a case-by-case basis. An impaired loan to a borrower that is nonperforming will typically be placed on nonaccrual status and we will reverse all accrued and unpaid interest. We generally apply all cash received during the nonaccrual period to the reduction of principal, thereby foregoing interest income recognition. Interest income may be recognized on an accrual basis for restructured impaired loans where the borrower is performing and is expected to continue to perform based on agreed-upon terms. We may modify the terms of a loan to maximize the collection of amounts due when a borrower is experiencing financial difficulties. Concessionary modifications are classified as troubled debt restructurings (“TDRs”) unless the modification results in only an insignificant delay in payments to be received. All of our restructured loans are considered TDRs. Allowance for Loan Losses The allowance for loan losses represents management’s estimate of probable credit losses inherent in our loan portfolio, which consists of CFC, NCSC and RTFC loan portfolio segments. Our allowance for loan losses for our portfolio segments consists of a collective allowance for loans that are not individually impaired and a specific allowance for loans identified as individually impaired. We increase or decrease the allowance for loan losses by recording a provision or benefit for loan losses in the statement of operations. We record charge-offs against the allowance for loan losses when management determines that any portion of a loan is uncollectible. We add subsequent recoveries, if any, to the allowance for loan losses. Collective Allowance The collective allowance is established, by loan portfolio segment, using an internal model to estimate probable incurred losses as of each balance sheet date. We further stratify our loan portfolio segments and group loans into pools based on member borrower type—distribution, power supply, telecommunications, and statewide and associates—as we consider our members with the same operations to share similar risk characteristics. We delineate each of our loan pools by borrower risk rating and apply loss factors to the outstanding principal balance at the end of each reporting period to determine the collective allowance for loan losses. The loss factors consist of a probability of default, or default rate, and the loss given default, or loss severity or recovery, for each loan pool. We derive the total collective loss estimate by applying the default rate, based on a five-year loss emergence period, and recovery rate, based on our historical experience, to each loan pool. Following is additional information on the key inputs and assumptions used in determining our collective allowance for loan losses. • Internal Risk Ratings : As part of our credit risk-management process, we regularly evaluate each borrower and loan facility in our loan portfolio and assign an internal risk rating. Our borrower risk rating is intended to reflect probability of default. We engage an independent third party to perform an annual review of a sample of borrowers and loan facilities to corroborate our internally assigned risk ratings. The risk ratings are based on quantitative and qualitative factors, including the general financial condition of the borrower; our judgment of the quality of the borrower’s management; our judgment of the borrower’s competitive position within its service territory and industry; our estimate of the potential impact of proposed regulation and litigation; and other factors specific to individual borrowers or classes of borrowers. • Loss Emergence Period : The loss emergence period represents the average time between when a loss-triggering event, such as a successful new investment or expansion of services, a severe weather event or deterioration in operations, occurs and the problem loan is charged-off, restructured or otherwise resolved. Our loss emergence period of five years is based on CFC’s historical average loss emergence period. • Default Rates : Because we have a limited history of defaults to develop reasonable and supportable estimated probability of default rates for our existing loan portfolio, we utilize third-party default data for the utility sector as a proxy to estimate probability of default rates for our loan portfolio segments. The third-party default data provides historical expected default rates, based on credit ratings and remaining maturities of outstanding bonds, for the utility sector. We align our internal borrower risk ratings to the credit ratings provided in the utility default rate table and apply the cumulative default rates for our estimated average loss emergence period of five years to each of our loan pools. • Recovery Rates : We utilize our internal historical loss experience to estimate loss given default, or the recovery rate, for each of our loan portfolio segments, as we believe it provides a more reliable estimate than third-party loss severity data due to the organizational structure and operating environment of rural utility cooperatives, our lending practice of generally requiring a senior security position on the assets and revenues of borrowers for long-term loans, and the approach we take in working with borrowers that may be experiencing operational or financial issues. The historical recovery rates for each portfolio segment may be adjusted based on management’s consideration and assessment of current conditions and relevant factors, such as recent trends in credit performance, historical variability of recovery rates and additional analysis of long-term loss severity experience, changes in risk-management practices, current and past underwriting standards, specific industry issues and trends and general economic conditions. Specific Allowance The specific allowance for individually impaired loans that are not collateral dependent is calculated based on the difference between the recorded investment in the loan and the present value of the expected future cash flows, discounted at the loan’s effective interest rate. If the loan is collateral dependent, we measure the impairment based on the current fair value of the collateral less estimated selling costs. Loans are considered to be collateral dependent if repayment of the loan is expected to be provided solely by the underlying collateral and there are no other available and reliable sources of repayment. Unadvanced Loan Commitments Unadvanced commitments represent amounts for which we have approved and executed loan contracts, but the funds have not been advanced. The majority of the unadvanced commitments reported represent amounts that are subject to material adverse change clauses at the time of the loan advance. Prior to making an advance on these facilities, we would confirm there has been no material adverse change in the business or condition, financial or otherwise, of the borrower since the time the loan was approved and confirm the borrower is currently in compliance with loan terms and conditions. The remaining unadvanced commitments relate to line of credit loans that are not subject to a material adverse change clause at the time of each loan advance. As such, we would be required to advance amounts on these committed facilities as long as the borrower is in compliance with the terms and conditions of the loan commitment. Unadvanced loan commitments related to line of credit loans are typically for periods not to exceed five years and are generally revolving facilities used for working capital and backup liquidity purposes. Historically, we have experienced a very low utilization rate on line of credit loan facilities, whether or not there is a material adverse change clause. Since we generally do not charge a fee on the unadvanced portion of the majority of our loan facilities, our borrowers will typically request long-term facilities to fund construction work plans and other capital expenditures for periods of up to five years and draw down on the facility over that time. In addition, borrowers will typically request an amount in excess of their immediate estimated loan requirements to avoid the expense related to seeking additional loan funding for unexpected items. These factors contribute to our expectation that the majority of the unadvanced loan commitments will expire without being fully drawn upon and that the total unadvanced amount does not necessarily represent future cash funding requirements. Reserve for Unadvanced Loan Commitments We maintain a reserve for unadvanced loan commitments and committed lines of credit. This reserve is included as a component of other liabilities on our consolidated balance sheets, and changes in the reserve are included in other non-interest expense on our consolidated statements of operations. Our estimate of the reserve for potential losses on these commitments takes into consideration various factors, including the existence of a material adverse change clause, the historical utilization of the committed lines of credit, the probability of funding, historical loss experience on unadvanced loan commitments and other inputs along with management judgment consistent with the methodology used to determine our allowance for loan losses. Fixed Assets Fixed assets are recorded at cost less accumulated depreciation. We recognize depreciation expense for each category of our depreciable fixed assets on a straight-line basis over the estimated useful life, which ranges from three to 40 years. We recognized depreciation expense of $9 million , $9 million and $8 million in fiscal years 2020 , 2019 and 2018 , respectively. The following table displays the components of our fixed assets. Our headquarters facility in Loudoun County, Virginia, which is owned by CFC, is included as a component of building and building equipment. May 31, (Dollars in thousands) 2020 2019 Building and building equipment $ 50,087 $ 50,167 Furniture and fixtures 6,015 6,012 Computer software and hardware 49,944 71,915 Other 1,051 1,069 Depreciable fixed assets 107,097 129,163 Less: Accumulated depreciation (59,007 ) (53,695 ) Net depreciable fixed assets 48,090 75,468 Land 23,796 23,796 Software development in progress 17,251 21,363 Fixed assets, net $ 89,137 $ 120,627 In the fourth quarter of fiscal year 2020, management made a decision to abandon a project to develop an internal-use loan origination and servicing platform. The project was intended to update our loan platform to provide increased functionality and flexibility and enhance the operational efficiency of our lending, loan servicing and loan accounting processes. As a result of the decision to abandon the project, we wrote off the capitalized amounts related to this project, which were recorded as a component of computer software and hardware and software development in progress, and recognized a non-cash impairment charge of $31 million in the fourth quarter of fiscal year 2020. The impairment charge is reported as a component of other non-interest expense on our consolidated statements of operations. Assets Held for Sale An asset is classified as held for sale when (i) management commits to a plan to sell the asset or business; (ii) the asset or business is available for sale in its present condition; (iii) the asset or business is actively marketed for sale at a reasonable price; (iv) the sale is expected to be completed within one year; and (v) it is unlikely significant changes to the plan will be made or that the plan will be withdrawn. Long-lived assets classified as held for sale are initially measured at the lower of their carrying amount or fair value less cost to sell. If the carrying value exceeds the estimated fair value less cost to sell in the period the held for sale criteria are met, an impairment charge is recorded equal to the amount by which the carrying amount exceeds the fair value less cost to sell. Subsequent changes in the long-lived asset’s fair value less cost to sell is reported as an adjustment to the carrying amount to the extent that the adjusted carrying amount does not exceed the carrying amount of the long-lived asset at the time it was initially classified as held for sale. On March 14, 2018, CFC entered into a purchase and sale agreement (“the agreement”), which was subsequently amended, for the sale of a parcel of land, consisting of approximately 28 acres, located in Loudoun County, Virginia. We designated the property, which had a carrying value of $14 million , as held for sale and reclassified it from fixed assets, net to other assets on our consolidated balance sheet. On July 22, 2019, we closed on the sale of the land and received net proceeds of $22 million , resulting in a gain of $8 million on the sale of this property, which is reported in other non-interest expense on our consolidated statements of operations. Foreclosed Assets Foreclosed assets acquired through our lending activities in satisfaction of indebtedness may be held in operating entities created and controlled by CFC and presented separately in our consolidated balance sheets under foreclosed assets, net. These assets are initially recorded at estimated fair value as of the date of acquisition. Subsequent to acquisition, foreclosed assets not classified as held for sale are evaluated for impairment, and the results of operations and any impairment are reported on our consolidated statements of operations under results of operations of foreclosed assets. When foreclosed assets meet the accounting criteria to be classified as held for sale, they are recorded at the lower of cost or fair value less estimated cost to sell at the date of transfer, with the amount at the date of transfer representing the new cost basis. Subsequent changes are recognized in our consolidated statements of operations under results of operations of foreclosed assets. We also review foreclosed assets classified as held for sale each reporting period to determine whether the existing carrying amounts are fully recoverable in comparison to estimated fair values. We did no t carry any foreclosed assets on our consolidated balance sheet as of May 31, 2020 or May 31, 2019 . Debt We report debt at cost net of unamortized issuance costs and discounts or premiums. Issuance costs, discounts and premiums are deferred and amortized into interest expense using the effective interest method or a method approximating the effective interest method over the legal maturity of each bond issue. Short-term borrowings consist of borrowings with an original contractual maturity of one year or less and do not include the current portion of long-term debt. Borrowings with an original contractual maturity of greater than one year are classified as long-term debt. Derivative Instruments We are an end user of derivative financial instruments and do not engage in derivative trading. We use derivatives, primarily interest rate swaps and Treasury rate locks, to manage interest rate risk. Derivatives may be privately negotiated contracts, which are often referred to as over-the-counter (“OTC”) derivatives, or they may be listed and traded on an exchange. We generally engage in OTC derivative transactions. In accordance with the accounting standards for derivatives and hedging activities, we record derivative instruments at fair value as either a derivative asset or derivative liability on our consolidated balance sheets. We report derivative asset and liability amounts on a gross basis based on individual contracts, which does not take into consideration the effects of master netting agreements or collateral netting. Derivatives in a gain position are reported as derivative assets on our consolidated balance sheets, while derivatives in a loss position are reported as derivative liabilities. Accrued interest related to derivatives is reported on our consolidated balance sheets as a component of either accrued interest receivable or accrued interest payable. If we do not elect hedge accounting treatment, changes in the fair value of derivative instruments, which consist of net accrued periodic derivative cash settlements expense and derivative forward value amounts, are recognized in our consolidated statements of operations under derivative gains (losses). If we elect hedge accounting treatment for derivatives, we formally document, designate and assess the effectiveness of the hedge relationship. Changes in the fair value of derivatives designated as qualifying fair value hedges are recorded in earnings together with offsetting changes in the fair value of the hedged item and any related ineffectiveness. Changes in the fair value of derivatives designated as qualifying cash flow hedges are recorded as a component of other comprehensive income (“OCI”), to the extent that the hedge relationships are effective, and reclassified from accumulated other comprehensive income (“AOCI”) to earnings using the effective interest method over the term of the forecasted transaction. Any ineffectiveness in the hedging relationship is recognized as a component of derivative gains (losses) in our consolidated statement of operations. We generally do not designate interest rate swaps, which represent the substantial majority of our derivatives, for hedge accounting. Accordingly, changes in the fair value of interest rate swaps are reported in our consolidated statements of operations under derivative gains (losses). Net periodic cash settlements expense related to interest rate swaps are classified as an operating activity in our consolidated statements of cash flows. We typically designate Treasury rate locks as cash flow hedges of forecasted debt issuances or repricings. Changes in the fair value of treasury locks designated as cash flow hedges are recorded as a component of OCI and reclassified from AOCI into interest expense when the forecasted transaction occurs using the effective interest method. Any ineffectiveness is recognized as a component of derivative gains (losses) in our consolidated statements of operations. Guarantee Liability We maintain a guarantee liability that represents our contingent and noncontingent exposure related to guarantees and standby liquidity obligations associated with our members’ debt. The guarantee liability is included in the other liabilities line item on the consolidated balance sheet, and the provision for guarantee liability is reported in non-interest expense as a separate line item on the consolidated statement of operations. The contingent portion of the guarantee liability represents management’s estimate of our exposure to losses within the guarantee portfolio. The methodology used to estimate the contingent guarantee liability is consistent with the methodology used to determine the allowance for loan losses. We have recorded a noncontingent guarantee liability for all new or modified guarantees since January 1, 2003. Our noncontingent guarantee liability represents our obligation to stand ready to perform over the term of our guarantees and liquidity obligations that we have entered into or modified since January 1, 2003. Our noncontingent obligation is estimated based on guarantee and liquidity fees charged for guarantees issued, which represents management’s estimate of the fair value of our obligation to stand ready to perform. The fees are deferred and amortized using the straight-line method into interest income over the term of the guarantee. Fair Value Valuation Processes We present certain financial instruments at fair value, including equity and debt securities, and derivatives. Fair value is defined as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date (also referred to as an exit price). We have various processes and controls in place to ensure that fair value is reasonably estimated. We consider observable prices in the principal market in our valua |
Variable Interest Entities (Not
Variable Interest Entities (Notes) | 12 Months Ended |
May 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entity Disclosure | NOTE 2—VARIABLE INTEREST ENTITIES NCSC and RTFC meet the definition of a VIE because they do not have sufficient equity investment at risk to finance their activities without financial support. CFC is the primary source of funding for NCSC and the sole source of funding for RTFC. Under the terms of management agreements with each company, CFC manages the business operations of NCSC and RTFC. CFC also unconditionally guarantees full indemnification for any loan losses of NCSC and RTFC pursuant to guarantee agreements with each company. CFC earns management and guarantee fees from its agreements with NCSC and RTFC. All loans that require NCSC board approval also require CFC board approval. CFC is not a member of NCSC and does not elect directors to the NCSC board. If CFC becomes a member of NCSC, it would control the nomination process for one NCSC director. NCSC members elect directors to the NCSC board based on one vote for each member. NCSC is a Class C member of CFC. All loans that require RTFC board approval also require approval by CFC for funding under RTFC’s credit facilities with CFC. CFC is not a member of RTFC and does not elect directors to the RTFC board. RTFC is a non-voting associate of CFC. RTFC members elect directors to the RTFC board based on one vote for each member. NCSC and RTFC creditors have no recourse against CFC in the event of a default by NCSC and RTFC, unless there is a guarantee agreement under which CFC has guaranteed NCSC or RTFC debt obligations to a third party. The following table provides information on incremental consolidated assets and liabilities of VIEs included in CFC’s consolidated financial statements, after intercompany eliminations, as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Total loans outstanding $ 1,083,197 $ 1,087,988 Other assets 11,352 10,963 Total assets $ 1,094,549 $ 1,098,951 Long-term debt $ — $ 6,000 Other liabilities 38,803 33,385 Total liabilities $ 38,803 $ 39,385 The following table provides information on CFC’s credit commitments to NCSC and RTFC, and its potential exposure to loss as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 CFC credit commitments $ 5,500,000 $ 5,500,000 Outstanding commitments: Borrowings payable to CFC (1) 1,062,103 1,059,629 Credit enhancements: CFC third-party guarantees 9,999 10,091 Other credit enhancements 11,755 14,251 Total credit enhancements (2) 21,754 24,342 Total outstanding commitments 1,083,857 1,083,971 CFC available credit commitments $ 4,416,143 $ 4,416,029 ____________________________ (1) Borrowings payable to CFC are eliminated in consolidation. (2) Excludes interest due on these instruments. CFC loans to NCSC and RTFC are secured by all assets and revenue of NCSC and RTFC. CFC’s maximum potential exposure, including interest due, for the credit enhancements totaled $22 million . The maturities for obligations guaranteed by CFC extend through 2031. |
Investment Securities (Notes)
Investment Securities (Notes) | 12 Months Ended |
May 31, 2020 | |
Investments [Abstract] | |
INVESTMENT SECURITIES | NOTE 3—INVESTMENT SECURITIES We currently hold investments in equity and debt securities. We record purchases and sales of our investment securities on a trade-date basis. Investments are denominated in US dollars exclusively. The accounting and measurement framework for investment securities differs depending on the security type and the classification. See “Note 1—Summary of Significant Accounting Policies” for additional information on our investment securities Equity Securities The following table presents the fair value of our equity securities, all of which had readily determinable fair values, as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Equity securities at fair value: Farmer Mac—Series A, B and C non-cumulative preferred stock $ 55,640 $ 82,445 Farmer Mac—class A common stock 5,095 5,088 Total equity securities at fair value $ 60,735 $ 87,533 We recognized net unrealized losses on our investments in equity securities of $2 million for both years ended May 31, 2020 and 2019 . These unrealized amounts are reported as a component of non-interest income on our consolidated statements of operations. For additional information on our investments in equity securities, see “Note 1—Summary of Significant Accounting Policies” and “Note 11—Equity—Accumulated Other Comprehensive Income.” On June 12, 2019, Farmer Mac redeemed its Series B non-cumulative preferred stock at a redemption price of $25.00 per share, plus any declared and unpaid dividends through and including the redemption date. The amortized cost of our investment in the Farmer Mac Series B non-cumulative preferred stock was $25 million as of the redemption date, which equaled the per share redemption price. In connection with this redemption, we recorded a realized loss on equity securities of $0.2 million for the year ended May 31, 2020 . Debt Securities Pursuant to our investment policy guidelines, all fixed-income debt securities, at the time of purchase, must be rated at least investment grade and on stable outlook based on external credit ratings from at least two of the leading global credit rating agencies, when available, or the corresponding equivalent, when not available. Securities rated investment grade, that is those rated Baa3 or higher by Moody’s Investors Service (“Moody’s”) or BBB- or higher by S&P or BBB- or higher by Fitch Ratings Inc. (“Fitch”), are generally considered by the rating agencies to be of lower credit risk than non-investment grade securities. In light of the extreme volatility and disruptions in the capital and credit markets in early March 2020 resulting from the COVID-19 crisis, including a significant decline in corporate debt and equity issuances and a deterioration in the commercial paper market, we took a number of precautionary actions in March to enhance our financial flexibility by bolstering our cash position to ensure we have adequate cash readily available to meet both expected and unexpected cash needs without adversely affecting our daily operations. These actions included, among others, revising our objective for the use of our held-to-maturity investment portfolio from previously serving as a supplemental source of liquidity to serving as a readily available source of liquidity and executing a plan for the orderly liquidation of a portion of debt securities in our investment portfolio. We therefore transferred securities with an amortized cost of $571 million from our held-to-maturity investment portfolio to trading and, in conjunction with the transfer, recognized an unrealized gain of $1 million in earnings in the fourth quarter of fiscal year 2020. Debt Securities Trading, at Fair Value The following table presents the fair value of our debt securities classified as trading by major security type as of May 31, 2020 . (Dollars in thousands) May 31, 2020 Debt securities trading, at fair value: Certificates of deposit $ 5,585 Corporate debt securities 253,153 Commercial MBS: Agency 7,655 Non-agency 3,207 Total commercial MBS 10,862 U.S. state and municipality debt securities 8,296 Other ABS (1) 31,504 Total debt securities trading, at fair value $ 309,400 ____________________________ (1) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. Realized and Unrealized Gains and Losses During the year ended May 31, 2020 , we sold debt investment securities totaling $239 million . The following table presents the gross realized and unrealized gains and losses on our debt securities classified as trading as of May 31, 2020 . These realized and unrealized amounts are reported as a component of non-interest income on our consolidated statements of operations. For additional information on our investments in debt securities, see “Note 1—Summary of Significant Accounting Policies.” (Dollars in thousands) May 31, 2020 Debt securities gains (losses): Realized gains $ 3,686 Unrealized gains 7,543 Total gains on debt securities trading $ 11,229 Debt Securities Held-to-Maturity, at Amortized Cost Amortized Cost and Fair Value of Debt Securities The following table presents the amortized cost and fair value of our debt securities classified as held to maturity and the corresponding gross unrealized gains and losses, by classification category and major security type, as of May 31, 2019 . May 31, 2019 (Dollars in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Debt securities held-to-maturity: Certificates of deposit $ 1,000 $ — $ — $ 1,000 Commercial paper 12,395 — — 12,395 U.S. agency debt securities 3,207 108 — 3,315 Corporate debt securities 478,578 4,989 (912 ) 482,655 Commercial MBS: Agency 7,255 291 — 7,546 Non-agency 3,453 — (7 ) 3,446 Total commercial MBS 10,708 291 (7 ) 10,992 U.S. state and municipality debt securities 9,608 352 — 9,960 Foreign government debt securities 1,254 42 — 1,296 Other ABS (1) 48,694 290 (48 ) 48,936 Total debt securities held-to-maturity $ 565,444 $ 6,072 $ (967 ) $ 570,549 ____________________________ (1) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. Debt Securities in Gross Unrealized Loss Position An unrealized loss exists when the fair value of an individual security is less than its amortized cost basis. The following table presents the fair value and gross unrealized losses for debt securities in a gross loss position, aggregated by security type, and the length of time the securities have been in a continuous unrealized loss position as of May 31, 2019 . The securities are segregated between investments that have been in a continuous unrealized loss position for less than 12 months and 12 months or more based on the point in time that the fair value declined below the amortized cost basis. May 31, 2019 Unrealized Loss Position Less than 12 Months Unrealized Loss Position 12 Months or Longer Total (Dollars in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Debt securities held-to-maturity: Commercial paper (1) $ 2,688 $ — $ — $ — $ 2,688 $ — Corporate debt securities 45,999 (198 ) 164,086 (714 ) 210,085 (912 ) Commercial MBS, non-agency 1,996 (4 ) 1,448 (3 ) 3,444 (7 ) Other ABS (2) 1,982 (4 ) 13,840 (44 ) 15,822 (48 ) Total debt securities held-to-maturity $ 52,665 $ (206 ) $ 179,374 $ (761 ) $ 232,039 $ (967 ) ____________________________ (1) Unrealized losses on the commercial paper investments are less than $1,000 . (2) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. Other-Than-Temporary Impairment During fiscal year 2019, we conducted periodic reviews of all securities with unrealized losses to evaluate whether the impairment is other than temporary. The number of individual securities in an unrealized loss position was 187 as of May 31, 2019 . We assessed each security with gross unrealized losses included in the above table for credit impairment. As part of that assessment, we concluded that the unrealized losses are driven by changes in market interest rates rather than by adverse changes in the credit quality of these securities. Based on our assessment, we expected to recover the entire amortized cost basis of these securities, as we did not intend to sell any of the securities and concluded that it is more likely than not that we will not be required to sell prior to recovery of the amortized cost basis. Accordingly, we considered the impairment of these securities to be temporary. Contractual Maturity and Yield The following table presents, by major security type, the remaining contractual maturity based on amortized cost and fair value of our held-to-maturity investment securities as of May 31, 2019 . Because borrowers may have the right to call or prepay certain obligations, the expected maturities of our investments may differ from the scheduled contractual maturities presented below. May 31, 2019 (Dollars in thousands) Due in 1 Year or Less Due > 1 Year through 5 Years Due > 5 Years through 10 Years Due >10 Years Total Amortized cost: Certificates of deposit $ — $ 1,000 $ — $ — $ 1,000 Commercial paper 12,395 — — — 12,395 U.S. agency debt securities — 2,678 529 — 3,207 Corporate debt securities 51,923 414,788 11,867 — 478,578 Commercial MBS: Agency — 310 6,945 — 7,255 Non-Agency — — — 3,453 3,453 Total Commercial MBS — 310 6,945 3,453 10,708 U.S. state and municipality debt securities — 9,608 — — 9,608 Foreign government debt securities — 1,254 — — 1,254 Other ABS (1) 510 45,730 2,454 — 48,694 Total $ 64,828 $ 475,368 $ 21,795 $ 3,453 $ 565,444 Fair value: Certificates of deposit $ — $ 1,000 $ — $ — $ 1,000 Commercial paper 12,395 — — — 12,395 U.S. agency debt securities — 2,769 546 — 3,315 Corporate debt securities 51,818 418,606 12,231 — 482,655 Commercial MBS: Agency — 317 7,229 — 7,546 Non-Agency — — — 3,446 3,446 Total Commercial MBS — 317 7,229 3,446 10,992 U.S. state and municipality debt securities — 9,960 — — 9,960 Foreign government debt securities — 1,296 — — 1,296 Other ABS (1) 509 45,916 2,511 — 48,936 Total $ 64,722 $ 479,864 $ 22,517 $ 3,446 $ 570,549 Weighted average coupon (2) 2.08 % 3.10 % 3.07 % 3.26 % 2.98 % ____________________________ (1) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. (2) Calculated based on the weighted-average coupon rate, which excludes the impact of amortization of premium and accretion of discount. The average contractual maturity and weighted-average coupon of our HTM investment securities was three years and 2.98% , respectively, as of May 31, 2019 . The average credit rating of these securities, based on the equivalent lowest credit rating by Moody’s, S&P and Fitch was A2, A and A, respectively, as of May 31, 2019 . Realized Gains and Losses We did not sell any of our debt investment securities during the year ended May 31, 2019 , and therefore have not recorded any realized gains or losses during fiscal year 2019. |
Loans (Notes)
Loans (Notes) | 12 Months Ended |
May 31, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Loans | NOTE 4—LOANS We offer loans under secured long-term facilities with terms up to 35 years and line of credit loans. Under secured long-term facilities, borrowers have the option of selecting a fixed or variable rate for a period of one to 35 years for each long-term loan advance. When a selected fixed interest rate term expires, the borrower may select another fixed-rate term or a variable rate. Line of credit loans are typically variable-rate revolving facilities and are generally unsecured. Collateral and security requirements for advances on loan commitments are identical to those required at the time of the initial loan approval. The following table presents the outstanding principal balance of loans to members, including deferred loan origination costs, and unadvanced loan commitments by loan type and member class, as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Loans Outstanding Unadvanced Commitments (1) Loans Outstanding Unadvanced Commitments (1) Loan type: Long-term loans: Fixed rate $ 24,472,003 $ — $ 23,094,253 $ — Variable rate 655,704 5,458,676 1,066,880 5,448,636 Total long-term loans 25,127,707 5,458,676 24,161,133 5,448,636 Lines of credit 1,563,147 7,929,950 1,744,531 7,788,922 Total loans outstanding 26,690,854 13,388,626 25,905,664 13,237,558 Deferred loan origination costs 11,526 — 11,240 — Loans to members $ 26,702,380 $ 13,388,626 $ 25,916,904 $ 13,237,558 Member class: CFC: Distribution $ 20,769,653 $ 8,992,457 $ 20,155,266 $ 8,773,018 Power supply 4,731,506 3,409,227 4,578,841 3,466,680 Statewide and associate 106,498 153,626 83,569 165,687 Total CFC 25,607,657 12,555,310 24,817,676 12,405,385 NCSC 697,862 551,674 742,888 552,840 RTFC 385,335 281,642 345,100 279,333 Total loans outstanding 26,690,854 13,388,626 25,905,664 13,237,558 Deferred loan origination costs 11,526 — 11,240 — Loans to members $ 26,702,380 $ 13,388,626 $ 25,916,904 $ 13,237,558 ____________________________ (1) The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. Unadvanced Loan Commitments Unadvanced loan commitments represent approved and executed loan contracts for which funds have not been advanced to borrowers. The following table summarizes, by loan type, the available balance under unadvanced loan commitments as of May 31, 2020 and related maturities by fiscal year for each of the next five fiscal years and thereafter. Available Notional Maturities of Unadvanced Loan Commitments (Dollars in thousands) 2021 2022 2023 2024 2025 Thereafter Line of credit loans $ 7,929,950 $ 4,050,588 $ 613,528 $ 1,223,510 $ 961,034 $ 1,032,749 $ 48,541 Long-term loans 5,458,676 497,104 1,364,755 873,822 1,674,029 1,044,671 4,295 Total $ 13,388,626 $ 4,547,692 $ 1,978,283 $ 2,097,332 $ 2,635,063 $ 2,077,420 $ 52,836 Unadvanced line of credit commitments accounted for 59% of total unadvanced loan commitments as of May 31, 2020 , while unadvanced long-term loan commitments accounted for 41% of total unadvanced loan commitments. Unadvanced line of credit commitments are typically revolving facilities for periods not to exceed five years. Unadvanced line of credit commitments generally serve as supplemental back-up liquidity to our borrowers. Historically, borrowers have not drawn the full commitment amount for line of credit facilities, and we have experienced a very low utilization rate on line of credit loan facilities regardless of whether or not we are obligated to fund the facility where a material adverse change exists. Our unadvanced long-term loan commitments have a five -year draw period under which a borrower may advance funds prior to the expiration of the commitment. We expect that the majority of the long-term unadvanced loan commitments of $5,459 million will be advanced prior to the expiration of the commitment. Because we historically have experienced a very low utilization rate on line of credit loan facilities, which account for the majority of our total unadvanced loan commitments, we believe the unadvanced loan commitment total of $13,389 million as of May 31, 2020 is not necessarily representative of our future funding cash requirements. Unadvanced Loan Commitments—Conditional The substantial majority of our line of credit commitments and all of our unadvanced long-term loan commitments include material adverse change clauses. Unadvanced loan commitments subject to material adverse change clauses totaled $10,532 million and $10,294 million as of May 31, 2020 and 2019 , respectively. Prior to making an advance on these facilities, we confirm there has been no material adverse change in the business or condition, financial or otherwise, of the borrower since the time the loan was approved and confirm the borrower is currently in compliance with loan terms and conditions. In some cases, the borrower’s access to the full amount of the facility is further constrained by the designated purpose, imposition of borrower-specific restrictions or by additional conditions that must be met prior to advancing funds. Unadvanced Loan Commitments—Unconditional Unadvanced loan commitments not subject to material adverse change clauses at the time of each advance consisted of unadvanced committed lines of credit totaling $2,857 million and $2,944 million as of May 31, 2020 and 2019 , respectively. As such, we are required to advance amounts on these committed facilities as long as the borrower is in compliance with the terms and conditions of the facility. The following table summarizes the available balance under unconditional committed lines of credit and the related maturities by fiscal year and thereafter, as of May 31, 2020 . Available Balance Notional Maturities of Unconditional Committed Lines of Credit (Dollars in thousands) 2021 2022 2023 2024 2025 Committed lines of credit $2,857,029 $115,815 $194,105 $970,366 $698,396 $878,347 Loan Sales We transfer, from time to time, whole loans and participating interests to third parties. These transfers, which meet the accounting criteria required to qualify for sale accounting, are made concurrently with the closing of the loan or participation agreement at par value. Accordingly, we remove the transferred loans or participating interests from our consolidated balance sheets when control has been surrendered and recognize a gain or loss on the sale. We retain a servicing performance obligation on the transferred loans and recognize related servicing fees on an accrual basis over the period for which servicing is provided, as we believe the servicing fee represents adequate compensation. Other than the servicing performance obligation, we do not hold any continuing interest in the loans sold to date. In addition, we have no obligation to repurchase loans that are sold, except in the case of breaches of representations and warranties. We sold CFC loans with outstanding balances totaling $151 million , $35 million and $119 million at par for cash in fiscal years 2020 , 2019 and 2018 , respectively. We recorded immaterial losses on the sale of these loans, which were attributable to unamortized deferred loan origination costs associated with the transferred loans. Pledging of Loans We are required to pledge eligible mortgage notes in an amount at least equal to the outstanding balance of our secured debt. The following table summarizes our loans outstanding as collateral pledged to secure our collateral trust bonds, Clean Renewable Energy Bonds, notes payable to Farmer Mac and notes payable under USDA’s Guaranteed Underwriter Program (“Guaranteed Underwriter Program”) and the amount of the corresponding debt outstanding as of May 31, 2020 and 2019 . See “Note 6—Short-Term Borrowings” and “Note 7—Long-Term Debt” for information on our borrowings. May 31, (Dollars in thousands) 2020 2019 Collateral trust bonds: 2007 indenture: Distribution system mortgage notes $ 8,244,202 $ 8,775,231 RUS-guaranteed loans qualifying as permitted investments 128,361 134,678 Total pledged collateral $ 8,372,563 $ 8,909,909 Collateral trust bonds outstanding 7,422,711 7,622,711 1994 indenture: Distribution system mortgage notes $ 39,785 $ 47,331 Collateral trust bonds outstanding 35,000 40,000 Farmer Mac: Distribution and power supply system mortgage notes $ 3,687,418 $ 3,751,798 Notes payable outstanding 3,059,637 3,054,914 Clean Renewable Energy Bonds Series 2009A: Distribution and power supply system mortgage notes $ 7,269 $ 10,349 Cash 395 415 Total pledged collateral $ 7,664 $ 10,764 Notes payable outstanding 6,068 9,225 Federal Financing Bank: Distribution and power supply system mortgage notes $ 7,535,931 $ 6,157,218 Notes payable outstanding 6,261,312 5,410,507 Credit Concentration Concentrations may exist when there are amounts loaned to borrowers engaged in similar activities or in geographic areas that would cause them to be similarly impacted by economic or other conditions or when there are large exposures to single borrowers. As a tax-exempt, member-owned finance cooperative, CFC’s principal focus is to provide funding to its rural electric utility cooperative members to assist them in acquiring, constructing and operating electric distribution systems, power supply systems and related facilities. We serve electric and telecommunications members throughout the United States, with a total of 889 borrowers located in 49 states as of May 31, 2020 . Loans to borrowers in Texas accounted for approximately 16% and 15% of total loans outstanding as of May 31, 2020 and 2019 , respectively, representing the largest concentration of loans outstanding to borrowers and also the highest number of borrowers in any one state. Because we lend primarily to our rural electric utility cooperative members, we have a loan portfolio subject to single-industry and single-obligor concentration risks. Loans outstanding to electric utility organizations represented approximately 99% of total loans outstanding as of May 31, 2020 , unchanged from May 31, 2019 . The remaining loans outstanding in our portfolio were to RTFC members, affiliates and associates in the telecommunications industry. The outstanding loan exposure for our 20 largest borrowers was 22% as of both May 31, 2020 and 2019 . The 20 largest borrowers consisted of 11 distribution systems and nine power supply systems as of May 31, 2020 . The 20 largest borrowers consisted of 10 distribution systems, nine power supply systems and one NCSC associate as of May 31, 2019 . The largest outstanding loan exposure to a single borrower or controlled group represented approximately 2% of total loans outstanding as of both May 31, 2020 and 2019 . As part of our strategy in managing our credit exposure, we entered into a long-term standby purchase commitment agreement with Farmer Mac during fiscal year 2016. Under this agreement, we may designate certain long-term loans to be covered under the commitment, subject to approval by Farmer Mac, and in the event any such loan later goes into payment default for at least 90 days, upon request by us, Farmer Mac must purchase such loan at par value. The aggregate unpaid principal balance of designated and Farmer Mac-approved loans was $569 million and $619 million as of May 31, 2020 and 2019 , respectively. Under the agreement, we are required to pay Farmer Mac a monthly fee based on the unpaid principal balance of loans covered under the purchase commitment. No loans had been put to Farmer Mac for purchase, pursuant to this agreement, as of May 31, 2020 . Also, we had long-term loans guaranteed by RUS totaling $147 million and $154 million as of May 31, 2020 and 2019 , respectively. Credit Quality Assessing the overall credit quality of our loan portfolio and measuring our credit risk is an ongoing process that involves tracking payment status, charge-offs, troubled debt restructurings, nonperforming and impaired loans, the internal risk ratings of our borrowers and other indicators of credit risk. We monitor and subject each borrower and loan facility in our loan portfolio to an individual risk assessment based on quantitative and qualitative factors. Internal risk ratings and payment status trends are indicators, among others, of the probability of borrower default and level of credit risk in our loan portfolio. Borrower Risk Ratings As part of our credit risk management process, we monitor and evaluate each borrower and loan in our loan portfolio and assign internal borrower and loan facility risk ratings based on quantitative and qualitative assessments. Our borrower risk ratings are intended to assess probability of default. Each risk rating is reassessed annually following the receipt of the borrower’s audited financial statements; however, interim risk-rating downgrades or upgrades may occur as a result of significant developments or trends. Our borrower risk ratings are intended to align with the interagency banking regulatory guidance on the framework for credit risk ratings and the definitions for the classification of credit exposures as pass or criticized. Pass ratings indicate relatively low probability of default, while criticized ratings, which consist of the categories special mention, substandard and doubtful indicate higher probability of default. Following is a description of each rating category. • Pass : Borrowers that are not experiencing difficulty and/or not showing a potential or well-defined credit weakness. • Special Mention : Borrowers that may be characterized by a potential credit weakness or deteriorating financial condition that is not sufficiently serious to warrant a classification of substandard or doubtful. • Substandard : Borrowers that display a well-defined credit weakness that may jeopardize the full collection of principal and interest. • Doubtful : Borrowers that have a well-defined credit weakness or weaknesses that make full collection of principal and interest, on the basis of currently known facts, conditions and collateral values, highly questionable and improbable. Loans to borrowers in the pass, special mention and substandard categories are generally considered not to be individually impaired and are included in our loan pools for determining the collective component of the allowance for loan losses. Loans to borrowers in the doubtful category are considered to be impaired and are therefore individually assessed for impairment in determining the asset-specific component of the allowance for loan losses. The following tables present total loans outstanding, by member class and borrower risk-rating category, based on the risk ratings as of May 31, 2020 and 2019 . If a parent company provides a guarantee of full repayment of loans of a subsidiary borrower, we group the outstanding loans in the borrower risk-rating category of the guarantor parent company instead of the risk-rating category of the subsidiary borrower for purposes of estimating the allowance for loan losses. The borrower risk ratings for loans outstanding presented in the tables below are based on this risk-rating grouping. May 31, 2020 (Dollars in thousands) Pass Special Mention Substandard Doubtful Total CFC: Distribution $ 20,643,737 $ 7,743 $ 118,173 $ — $ 20,769,653 Power supply 4,516,595 — 47,203 167,708 4,731,506 Statewide and associate 90,274 16,224 — — 106,498 CFC total 25,250,606 23,967 165,376 167,708 25,607,657 NCSC 697,862 — — — 697,862 RTFC 371,507 8,736 5,092 — 385,335 Total loans outstanding $ 26,319,975 $ 32,703 $ 170,468 $ 167,708 $ 26,690,854 May 31, 2019 (Dollars in thousands) Pass Special Mention Substandard Doubtful Total CFC: Distribution $ 20,022,193 $ 10,375 $ 122,698 $ — $ 20,155,266 Power supply 4,530,708 — 48,133 — 4,578,841 Statewide and associate 68,569 15,000 — — 83,569 CFC total 24,621,470 25,375 170,831 — 24,817,676 NCSC 742,888 — — — 742,888 RTFC 339,508 — 5,592 — 345,100 Total loans outstanding $ 25,703,866 $ 25,375 $ 176,423 $ — $ 25,905,664 The substantial majority of the loan amount in the substandard category is attributable to one electric distribution borrower and its subsidiary, which had loans outstanding totaling $165 million and $171 million as of May 31, 2020 and 2019 , respectively. The electric distribution cooperative borrower owns and operates a distribution and transmission system. Several years ago, it established a subsidiary to deploy retail broadband service in underserved rural communities. Although the borrower has experienced financial difficulties due to recent net losses and liquidity constraints, the borrower and its subsidiary are current with regard to all principal and interest payments and have never been delinquent. The borrower, which operates in a territory that is not rate-regulated, increased its electric and broadband rates in March 2019 and has taken other actions to improve its financial performance and liquidity. All of the loans outstanding to this borrower were secured under our typical collateral requirements for long-term loan advances as of May 31, 2020 . We currently expect to collect all principal and interest amounts due from the borrower and its subsidiary. Accordingly, the loans outstanding to this borrower and its subsidiary were not deemed to be impaired as of May 31, 2020 r. The loan amount in the doubtful category of $168 million as of May 31, 2020 , represents one loan to a CFC power supply borrower. Under the terms of the loan, which matures in December 2026, the amount the borrower is required to pay in 2024 and 2025 may vary as the payments are contingent on the borrower’s financial performance in those years. As of May 31, 2020 , the borrower was current with respect to required payments on the loan and not in default. However, based on our review and assessment of the most recent forecast and underlying assumptions provided by the borrower in May 2020, we no longer believe that the total future expected cash payments from the borrower through the maturity of the loan in December 2026 will be sufficient to repay the outstanding loan balance of $168 million as of May 31, 2020 . We therefore determined that it was appropriate to classify the loan as nonperforming, designate it as impaired and include it in the doubtful risk-rating category as of May 31, 2020 . Payment Status of Loans The following tables present the payment status of loans outstanding by member class as of May 31, 2020 and 2019 . As indicated in the table below, we did not have any delinquent loans as of either May 31, 2020 or May 31, 2019 . Although, as discussed above, the CFC power supply borrower with an outstanding loan of $168 million was current with respect to required payments on the loan and not in default, we classified this loan as nonperforming and placed it on nonaccrual status as of May 31, 2020 . May 31, 2020 (Dollars in thousands) Current 30-89 Days Past Due 90 Days or More Past Due (1) Total Past Due Total Loans Outstanding Nonaccrual Loans CFC: Distribution $ 20,769,653 $ — $ — $ — $ 20,769,653 $ — Power supply 4,731,506 — — — 4,731,506 167,708 Statewide and associate 106,498 — — — 106,498 — CFC total 25,607,657 — — — 25,607,657 167,708 NCSC 697,862 — — — 697,862 — RTFC 385,335 — — — 385,335 — Total loans outstanding $ 26,690,854 $ — $ — $ — $ 26,690,854 $ 167,708 Percentage of total loans 100.00 % — % — % — % 100.00 % 0.63 % May 31, 2019 (Dollars in thousands) Current 30-89 Days Past Due 90 Days or More Past Due (1) Total Total Loans Outstanding Nonaccrual Loans CFC: Distribution $ 20,155,266 $ — $ — $ — $ 20,155,266 $ — Power supply 4,578,841 — — — 4,578,841 — Statewide and associate 83,569 — — — 83,569 — CFC total 24,817,676 — — — 24,817,676 — NCSC 742,888 — — — 742,888 — RTFC 345,100 — — — 345,100 — Total loans outstanding $ 25,905,664 $ — $ — $ — $ 25,905,664 $ — Percentage of total loans 100.00 % — % — % — % 100.00 % — % ____________________________ (1) All loans 90 days or more past due are on nonaccrual status. Troubled Debt Restructurings We did not have any loans modified as TDRs during the year ended May 31, 2020 . The following table provides a summary of loans modified as TDRs in prior periods, the performance status of these loans and the unadvanced loan commitments related to the TDR loans, by member class, as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Loans Outstanding % of Total Loans Unadvanced Commitments Loans Outstanding % of Total Loans Unadvanced Commitments TDR loans: Performing TDR loans: CFC/Distribution $ 5,755 0.02 % $ — $ 6,261 0.03 % $ — RTFC 5,092 0.02 — 5,592 0.02 — Total performing TDR loans 10,847 0.04 — 11,853 0.05 — Total TDR loans $ 10,847 0.04 % $ — $ 11,853 0.05 % $ — We did not have any TDR loans classified as nonperforming as of May 31, 2020 or May 31, 2019 . TDR loans classified as performing as of May 31, 2020 and 2019 were performing in accordance with the terms of their respective restructured loan agreement and on accrual status as of the respective reported dates. The TDR loan outstanding amount for CFC relates to a loan with one borrower. This borrower also had two line of credit facilities as of May 31, 2020 and 2019 . One line of credit facility for $6 million as of both May 31, 2020 and 2019 , is restricted for fuel purchases only. Outstanding loans under this facility totaled less than $1 million as of May 31, 2020 and $3 million as of May 31, 2019 , and were classified as performing as of each respective date. The other line of credit facility for $2 million as of May 31, 2020 and 2019 , was put in place during fiscal year 2019 to provide bridge funding for electric work plan expenditures in anticipation of receiving RUS funding. Outstanding loans under this facility totaled $2 million and $1 million as of May 31, 2020 and 2019 , respectively, and were classified as performing as of each respective date. The TDR loan outstanding amount for RTFC relates to a loan with one borrower. During fiscal year 2020, we amended the restructured loan agreement with the borrower to extend the maturity by two years. The amended RTFC loan currently remains on accrual status and will continue to amortize monthly through the maturity date of the loan. Nonperforming Loans In addition to TDR loans that may be classified as nonperforming, we also may have nonperforming loans that have not been modified as a TDR. We had one loan to a CFC power supply borrower with an outstanding balance of $168 million , which we classified as nonperforming and designated as impaired as of May 31, 2020 , and also classified as doubtful. Under the terms of the loan, which matures in December 2026, the amount the borrower is required to pay in 2024 and 2025 may vary as the payments are contingent on the borrower’s financial performance in those years. As of May 31, 2020 , the borrower was current with respect to required payments on the loan and not in default. However, based on our review and assessment of the most recent forecast and underlying assumptions provided by the borrower in May 2020, we no longer believe that the total future expected cash payments from the borrower through the maturity of the loan in December 2026 will be sufficient to repay the outstanding loan balance of $168 million as of May 31, 2020 . We therefore determined that it was appropriate to classify the loan as nonperforming and place it on nonaccrual status as of May 31, 2020 . We did not have any loans classified as nonperforming as of May 31, 2019 . We had no foregone interest income for loans on nonaccrual status for the years ended May 31, 2020, 2019 and 2018 . Impaired Loans The following table provides information on loans classified as individually impaired as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Recorded Investment Related Allowance Recorded Investment Related Allowance With no specific allowance recorded: CFC $ 5,756 $ — $ 6,261 $ — With a specific allowance recorded: CFC 167,708 33,854 RTFC 5,092 979 5,592 1,021 Total impaired loans $ 178,556 $ 34,833 $ 11,853 $ 1,021 The following table presents, by company, the average recorded investment for individually impaired loans and the interest income recognized on these loans for fiscal years ended May 31, 2020, 2019 and 2018 . Average Recorded Investment Interest Income Recognized (Dollars in thousands) 2020 2019 2018 2020 2019 2018 CFC $ 11,834 $ 6,322 $ 6,524 $ 568 $ 553 $ 571 RTFC 5,361 5,861 6,361 268 293 318 Total impaired loans $ 17,195 $ 12,183 $ 12,885 $ 836 $ 846 $ 889 Net Charge-Offs Charge-offs represent the amount of a loan that has been removed from our consolidated balance sheet when the loan is deemed uncollectible. Generally the amount of a charge-off is the recorded investment in excess of the fair value of the expected cash flows from the loan, or, if the loan is collateral dependent, the fair value of the underlying collateral securing the loan. We report charge-offs net of amounts recovered on previously charged-off loans. We had no loan defaults or charge-offs during the years ended May 31, 2020, 2019 and 2018 . |
Allowance for Loan Losses - (No
Allowance for Loan Losses - (Notes) | 12 Months Ended |
May 31, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Allowance for Credit Losses | NOTE 5—ALLOWANCE FOR LOAN LOSSES The following tables summarize changes, by company, in the allowance for loan losses as of and for the years ended May 31, 2020, 2019 and 2018 . Year Ended May 31, 2020 (Dollars in thousands) CFC NCSC RTFC Total Balance as of May 31, 2019 $ 13,120 $ 2,007 $ 2,408 $ 17,535 Provision (benefit) for loan losses 34,318 (1,201 ) 2,473 35,590 Balance as of May 31, 2020 $ 47,438 $ 806 $ 4,881 $ 53,125 Year Ended May 31, 2019 (Dollars in thousands) CFC NCSC RTFC Total Balance as of May 31, 2018 $ 12,300 $ 2,082 $ 4,419 $ 18,801 Provision (benefit) for loan losses 820 (75 ) (2,011 ) (1,266 ) Balance as of May 31, 2019 $ 13,120 $ 2,007 $ 2,408 $ 17,535 Year Ended May 31, 2018 (Dollars in thousands) CFC NCSC RTFC Total Balance as of May 31, 2017 $ 29,499 $ 2,910 $ 4,967 $ 37,376 Benefit for loan losses (17,199 ) (828 ) (548 ) (18,575 ) Balance as of May 31, 2018 $ 12,300 $ 2,082 $ 4,419 $ 18,801 The following tables present, by company, the components of our allowance for loan losses and the recorded investment of the related loans as of May 31, 2020 and 2019 . May 31, 2020 (Dollars in thousands) CFC NCSC RTFC Total Ending balance of the allowance: Collective allowance $ 13,584 $ 806 $ 3,902 $ 18,292 Asset-specific allowance 33,854 — 979 34,833 Total ending balance of the allowance $ 47,438 $ 806 $ 4,881 $ 53,125 Recorded investment in loans: Collectively evaluated loans $ 25,434,193 $ 697,862 $ 380,243 $ 26,512,298 Individually evaluated loans 173,464 — 5,092 178,556 Total recorded investment in loans $ 25,607,657 $ 697,862 $ 385,335 $ 26,690,854 Total recorded investment in loans, net (1) $ 25,560,219 $ 697,056 $ 380,454 $ 26,637,729 Allowance coverage ratio: Allowance as a percentage of total recorded investment in loans 0.19 % 0.12 % 1.27 % 0.20 % May 31, 2019 (Dollars in thousands) CFC NCSC RTFC Total Ending balance of the allowance: Collective allowance $ 13,120 $ 2,007 $ 1,387 $ 16,514 Asset-specific allowance — — 1,021 1,021 Total ending balance of the allowance $ 13,120 $ 2,007 $ 2,408 $ 17,535 Recorded investment in loans: Collectively evaluated loans $ 24,811,415 $ 742,888 $ 339,508 $ 25,893,811 Individually evaluated loans 6,261 — 5,592 11,853 Total recorded investment in loans $ 24,817,676 $ 742,888 $ 345,100 $ 25,905,664 Total recorded investment in loans, net (1) $ 24,804,556 $ 740,881 $ 342,692 $ 25,888,129 Allowance coverage ratio: Allowance as a percentage of total recorded investment in loans 0.05 % 0.27 % 0.70 % 0.07 % ___________________________ (1) Excludes unamortized deferred loan origination costs of $11 million as of both May 31, 2020 and 2019 . As indicated above in “Note 4—Loans,” we had one loan classified as nonperforming totaling $168 million with an asset-specific allowance of $34 million as of May 31, 2020 . We did not have any loans classified as nonperforming as of May 31, 2019 . In addition to the allowance for loan losses, we also maintain a reserve for unadvanced loan commitments at a level estimated by management to provide for probable losses under these commitments as of each balance sheet date. The reserve for unadvanced loan commitments was less than $1 million as of both May 31, 2020 and 2019 . |
Short-Term Borrowings (Notes)
Short-Term Borrowings (Notes) | 12 Months Ended |
May 31, 2020 | |
Debt Disclosure [Abstract] | |
Short-Term Borrowings | NOTE 6—SHORT-TERM BORROWINGS Short-term borrowings consist of borrowings with an original contractual maturity of one year or less and do not include the current portion of long-term debt. Our short-term borrowings totaled $3,962 million and accounted for 15% of total debt outstanding as of May 31, 2020 , compared with $3,608 million , or 14% , of total debt outstanding as of May 31, 2019 . The following table provides comparative information on our short-term borrowings and weighted-average interest rates as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amount Weighted- Average Interest Rate Amount Weighted-Average Interest Rate Short-term borrowings: Commercial paper: Commercial paper sold through dealers, net of discounts $ — — % $ 944,616 2.46 % Commercial paper sold directly to members, at par 1,318,566 0.34 1,111,795 2.52 Total commercial paper 1,318,566 0.34 % 2,056,411 2.49 % Select notes 1,597,959 0.75 1,023,952 2.70 Daily liquidity fund notes 508,618 0.10 298,817 2.25 Medium-term notes sold to members 286,842 1.64 228,546 2.87 Farmer Mac notes payable (1) 250,000 1.06 — — Total short-term borrowings $ 3,961,985 0.62 $ 3,607,726 2.56 ___________________________ (1) Advanced under the revolving note purchase agreement with Farmer Mac dated March 24, 2011. See “Note 7—Long-Term Debt” for additional information on this revolving note purchase agreement with Farmer Mac. We issue commercial paper for periods of one to 270 days . We also issue select notes for periods ranging from 30 to 270 days . Select notes are unsecured obligations that do not require backup bank lines of credit for liquidity purposes. These notes require a larger minimum investment than our commercial paper sold to members and, as a result, offer a higher interest rate than our commercial paper. We also issue daily liquidity fund notes, which are unsecured obligations that do not require backup bank lines of credit for liquidity purposes. We also issue medium-term notes, which represent unsecured obligations that may be issued through dealers in the capital markets or directly to our members. Committed Bank Revolving Line of Credit Agreements We had $2,725 million and $2,975 million of commitments under committed bank revolving line of credit agreements as of May 31, 2020 and 2019 , respectively. Under our current committed bank revolving line of credit agreements, we have the ability to request up to $300 million of letters of credit, which would result in a reduction in the remaining available amount under the facilities. On November 26, 2019, we amended the three-year and five-year committed bank revolving line of credit agreements to extend the maturity date of the three-year agreement to November 28, 2022, and to terminate certain bank commitments totaling $125 million under the three-year agreement and $125 million under the five-year agreement. As a result, the total commitment amount from third parties under the three-year facility and the five-year facility is $1,315 million and $1,410 million , respectively, resulting in a combined total commitment amount under the two facilities of $2,725 million . The following table presents the total commitment, the net amount available for use and the outstanding letters of credit under our committed bank revolving line of credit agreements as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in millions) Total Commitment Letters of Credit Outstanding Net Available for Use Total Commitment Letters of Credit Outstanding Net Available for Use Maturity Annual Facility Fee (1) 3-year agreement, 2021 $ — $ — $ — $ 1,440 $ — $ 1,440 November 28, 2021 7.5 bps 3-year agreement, 2022 1,315 — 1,315 — — — November 28, 2022 7.5 bps Total 3-year agreement 1,315 — 1,315 1,440 — 1,440 5-year agreement, 2023 1,410 3 1,407 1,535 3 1,532 November 28, 2023 10 bps Total $ 2,725 $ 3 $ 2,722 $ 2,975 $ 3 $ 2,972 ___________________________ (1) Facility fee determined by CFC’s senior unsecured credit ratings based on the pricing schedules put in place at the inception of the related agreement. We had no borrowings outstanding under our committed bank revolving line of credit agreements as of May 31, 2020 and 2019 , and we were in compliance with all covenants and conditions under the agreements as of each date. |
Long-Term Debt (Notes)
Long-Term Debt (Notes) | 12 Months Ended |
May 31, 2020 | |
Debt Instruments [Abstract] | |
Long-Term Debt | NOTE 7—LONG-TERM DEBT The following table displays long-term debt outstanding and the weighted-average interest rates, by debt type, as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amount Weighted- Average Maturity Date Amount Weighted- Average Maturity Date Secured long-term debt: Collateral trust bonds $ 7,457,711 3.23 % 2020-2049 $ 7,662,711 3.19 % 2019-2049 Unamortized discount (236,461 ) (244,643 ) Debt issuance costs (32,697 ) (34,336 ) Total collateral trust bonds 7,188,553 7,383,732 Guaranteed Underwriter Program notes payable 6,261,312 2.74 2025-2040 5,410,507 2.97 2025-2039 Farmer Mac notes payable 2,809,637 2.07 2020-2049 3,054,914 3.33 2019-2049 Other secured notes payable 6,068 2.69 2023 9,225 2.70 2024 Debt issuance costs (117 ) (178 ) Total other secured notes payable 5,951 9,047 Total secured notes payable 9,076,900 2.53 8,474,468 3.10 Total secured long-term debt 16,265,453 2.85 15,858,200 3.14 Unsecured long-term debt: Medium-term notes sold through dealers 3,086,733 3.34 2020-2032 2,962,375 3.55 2019-2032 Medium-term notes sold to members 372,117 2.85 2020-2037 397,080 3.03 2019-2037 Subtotal medium-term notes 3,458,850 3.29 3,359,455 3.49 Unamortized discount (997 ) (931 ) Debt issuance costs (16,943 ) (19,399 ) Total unsecured medium-term notes 3,440,910 3,339,125 Unsecured notes payable: 5,794 — 2023 13,701 3.97 2022-2023 Unamortized discount (107 ) (187 ) Debt issuance costs (26 ) (46 ) Total unsecured notes payable 5,661 13,468 Total unsecured long-term debt 3,446,571 3.29 3,352,593 3.49 Total long-term debt $ 19,712,024 2.92 $ 19,210,793 3.20 The following table presents the amount of long-term debt maturing in each of the five fiscal years subsequent to May 31, 2020 and thereafter. (Dollars in thousands) Amount Weighted-Average Interest Rate 2021 $ 2,016,164 2.41 % 2022 2,517,356 2.12 2023 1,221,908 2.33 2024 1,117,749 3.00 2025 807,793 2.77 Thereafter 12,031,054 3.24 Total $ 19,712,024 2.92 Medium-Term Notes Medium-term notes represent unsecured obligations that may be issued through dealers in the capital markets or directly to our members. On February 5, 2020, we issued $500 million aggregate principal amount of 1.75% dealer medium-term notes due 2022. Collateral Trust Bonds Collateral trust bonds represent secured obligations sold to investors in the capital markets. Collateral trust bonds are secured by the pledge of mortgage notes or eligible securities in an amount at least equal to the principal balance of the bonds outstanding. On October 15, 2019, we redeemed the $300 million outstanding principal amount of our 2.30% collateral trust bonds due November 15, 2019 at par. On December 27, 2019, we redeemed the $400 million outstanding principal amount of our 2.00% collateral trust bonds due January 27, 2020 at par. On February 5, 2020, we issued $500 million aggregate principal amount of 2.40% collateral trust bonds due 2030. Secured Notes Payable We had outstanding secured notes payable totaling $6,261 million and $5,411 million as of May 31, 2020 and 2019 , respectively, under bond purchase agreements with the Federal Financing Bank and a bond guarantee agreement with RUS issued under the Guaranteed Underwriter Program, which provides guarantees to the Federal Financing Bank. We pay RUS a fee of 30 basis points per year on the total amount outstanding. On February 13, 2020, we closed on a $500 million committed loan facility (“Series P”) from the Federal Financing Bank under the Guaranteed Underwriter Program. Pursuant to this facility, we may borrow any time before July 15, 2024. Each advance is subject to quarterly amortization and a final maturity not longer than 30 years from the date of the advance. During the year ended May 31, 2020 , we borrowed $950 million under our committed loan facilities with the Federal Financing Bank. We had up to $900 million available for access under the Guaranteed Underwriter Program as of May 31, 2020 . The notes outstanding under the Guaranteed Underwriter Program contain a provision that if during any portion of the fiscal year, our senior secured credit ratings do not have at least two of the following ratings: (i) A3 or higher from Moody’s, (ii) A- or higher from S&P, (iii) A- or higher from Fitch or (iv) an equivalent rating from a successor rating agency to any of the above rating agencies, we may not make cash patronage capital distributions in excess of 5% of total patronage capital. We are required to pledge eligible distribution system or power supply system loans as collateral in an amount at least equal to the total principal amount of notes outstanding under the Guaranteed Underwriter Program. See “Note 4—Loans” for additional information on the collateral pledged to secure notes payable under this program. We had one revolving note purchase agreement with Farmer Mac as of May 31, 2020 , which allowed us to borrow up to $5,500 million from Farmer Mac. Under this revolving note purchase agreement, dated March 24, 2011, as amended, we can borrow up to $5,500 million as of May 31, 2020 , at any time, subject to market conditions, through January 11, 2022. This date automatically extends on each anniversary date of the closing for an additional year, unless prior to any such anniversary date, Farmer Mac provides us with a notice that the draw period will not be extended beyond the remaining term. Pursuant to this revolving note purchase agreement, we can borrow, repay and re-borrow funds at any time through maturity, as market conditions permit, provided that the outstanding principal amount at any time does not exceed the total available under the agreement. Each borrowing under the revolving note purchase agreement is evidenced by a pricing agreement setting forth the interest rate, maturity date and other related terms as we may negotiate with Farmer Mac at the time of each such borrowing. We may select a fixed rate or variable rate at the time of each advance with a maturity as determined in the applicable pricing agreement. We had outstanding secured long-term notes payable totaling $2,810 million and $3,055 million , as of May 31, 2020 and 2019 , respectively, under this Farmer Mac revolving note purchase agreement. We borrowed $250 million under this note purchase agreement with Farmer Mac during the year ended May 31, 2020 . The available borrowing amount totaled $2,440 million as of May 31, 2020 . As of May 31, 2019 , we had a second revolving note purchase agreement with Farmer Mac, dated July 31, 2015, as amended, under which we could borrow up to $300 million at any time through December 20, 2023 at a fixed spread over London Interbank Offered Rate (“LIBOR”). This agreement also allowed us to borrow, repay and re-borrow funds at any time through maturity, provided that the outstanding principal amount at any time does not exceed the total available under the agreement. We had no notes payable outstanding under this agreement as of May 31, 2019 . On December 20, 2019, we terminated the $300 million revolving note purchase agreement with Farmer Mac. As a result of the termination of this revolving note purchase agreement, the commitment amount under the $5,200 million revolving note purchase agreement with Farmer Mac discussed above, increased to $5,500 million , effective December 20, 2019. Pursuant to the Farmer Mac revolving note purchase agreement, we are required to pledge eligible distribution system or power supply system loans as collateral in an amount at least equal to the total principal amount of notes outstanding. See “Note 4—Loans” for additional information on the pledged collateral. On March 31, 2020, we prepaid approximately $2 million of our secured Clean Renewable Energy Bond due to a prepayment of a loan associated with the bond. Unsecured Notes Payable On November 15, 2019, we redeemed the $6 million outstanding principal amount of our 9.07% notes payable due May 15, 2022, at a premium of less than $1 million . We were in compliance with all covenants and conditions under our senior debt indentures as of May 31, 2020 and 2019 . |
Subordinated Deferrable Debt (N
Subordinated Deferrable Debt (Notes) | 12 Months Ended |
May 31, 2020 | |
Subordinated Debt [Abstract] | |
Subordinated Deferrable Debt | NOTE 8—SUBORDINATED DEFERRABLE DEBT Subordinated deferrable debt is long-term debt that is subordinated to our outstanding debt and senior to subordinated certificates held by our members. Our 4.75% and 5.25% subordinated debt due 2043 and 2046, respectively, was issued for a term of up to 30 years , pays interest semi-annually, may be called at par after 10 years, converts to a variable rate after 10 years, and allows us to defer the payment of interest for one or more consecutive interest periods not exceeding five consecutive years. Our 5.50% subordinated debt due 2064 was issued for a term of up to 45 years , pays interest quarterly, may be called at par after five years and allows us to defer the payment of interest for one or more consecutive interest periods not exceeding 40 consecutive quarterly periods. To date, we have not exercised our right to defer interest payments. The following table presents subordinated deferrable debt outstanding and the weighted-average interest rates as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amount Weighted- Average Interest Rate Amount Weighted-Average Interest Rate 4.75% due 2043 with a call date of April 30, 2023 $ 400,000 4.75 % $ 400,000 4.75 % 5.25% due 2046 with a call date of April 20, 2026 350,000 5.25 350,000 5.25 5.50% due 2064 with a call date of May 15, 2024 250,000 5.50 250,000 5.50 % Debt issuance costs (13,881 ) (13,980 ) Total subordinated deferrable debt $ 986,119 5.11 $ 986,020 5.11 |
Members' Subordinated Certifica
Members' Subordinated Certificates (Notes) | 12 Months Ended |
May 31, 2020 | |
Subordinated Borrowings [Abstract] | |
Members' Subordinated Certificates | NOTE 9—MEMBERS’ SUBORDINATED CERTIFICATES Membership Subordinated Certificates CFC members were required to purchase membership subordinated certificates as a condition of membership prior to June 2009. Such certificates are interest-bearing, unsecured, subordinated debt. Membership certificates typically have an original maturity of 100 years and pay interest at 5% semi-annually. No requirement to purchase membership certificates has existed for NCSC or RTFC members. Loan and Guarantee Subordinated Certificates Members obtaining long-term loans, certain line of credit loans or guarantees may be required to purchase additional loan or guarantee subordinated certificates with each such loan or guarantee based on the borrower’s debt-to-equity ratio with CFC. These certificates are unsecured, subordinated debt and may be interest bearing or non-interest bearing. Under our current policy, most borrowers requesting standard loans are not required to buy subordinated certificates as a condition of a loan or guarantee. Borrowers meeting certain criteria, including but not limited to, high leverage ratios, or borrowers requesting large facilities, may be required to purchase loan or guarantee subordinated certificates or member capital securities (described below) as a condition of the loan. Loan subordinated certificates have the same maturity as the related long-term loan. Some certificates may amortize annually based on the outstanding loan balance. The interest rates payable on guarantee subordinated certificates purchased in conjunction with our guarantee program vary in accordance with applicable CFC policy. Guarantee subordinated certificates have the same maturity as the related guarantee. Member Capital Securities CFC offers member capital securities to its voting members. Member capital securities are interest-bearing, unsecured obligations of CFC, which are subordinate to all existing and future senior and subordinated indebtedness of CFC held by non-members of CFC, but rank proportionally to our member subordinated certificates. Member capital securities mature 30 years from the date of issuance, typically pay interest at 5% and are callable at par at our option 10 years from the date of issuance and anytime thereafter. These securities represent voluntary investments in CFC by the members. The following table displays members’ subordinated certificates and the weighted-average interest rates as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amounts Outstanding Weighted- Interest Rate Amounts Outstanding Weighted- Interest Rate Membership subordinated certificates: Certificates maturing 2020 through 2119 $ 630,467 $ 630,466 Subscribed and unissued (1) 16 8 Total membership subordinated certificates 630,483 4.95 % 630,474 4.95 % Loan and guarantee subordinated certificates: Interest-bearing loan subordinated certificates maturing through 2045 280,372 290,259 Non-interest-bearing loan subordinated certificates maturing through 2047 144,258 150,152 Subscribed and unissued (1) 45 45 Total loan subordinated certificates 424,675 2.71 440,456 2.73 Interest-bearing guarantee subordinated certificates maturing through 2044 43,700 47,878 Non-interest-bearing guarantee subordinated certificates maturing through 2037 14,590 17,151 Total guarantee subordinated certificates 58,290 4.43 65,029 4.49 Total loan and guarantee subordinated certificates 482,965 2.92 505,485 2.95 Member capital securities: Securities maturing through 2050 226,170 5.00 221,170 5.00 Total members’ subordinated certificates $ 1,339,618 4.22 $ 1,357,129 4.21 ___________________________ (1) The subscribed and unissued subordinated certificates represent subordinated certificates that members are required to purchase. Upon collection of full payment of the subordinated certificate amount, the certificate will be reclassified from subscribed and unissued to outstanding. The weighted-average maturity for all membership subordinated certificates outstanding was 56 years and 57 years as of May 31, 2020 and 2019 , respectively. The following table presents the amount of members’ subordinated certificates maturing in each of the five fiscal years following May 31, 2020 and thereafter. (Dollars in thousands) Amount Maturing (1) Weighted-Average Interest Rate 2021 $ 40,511 3.60 % 2022 13,339 3.07 2023 22,321 3.70 2024 15,240 2.37 2025 24,212 1.66 Thereafter 1,223,934 4.34 Total $ 1,339,557 4.22 ___________________________ (1) Excludes $0.06 million in subscribed and unissued member subordinated certificates for which a payment has been received, but no certificate has been issued. Amortizing member loan subordinated certificates totaling $239 million are amortizing annually based on the unpaid principal balance of the related loan. Amortization payments on these certificates totaled $14 million in fiscal year 2020 and represented 6% of amortizing loan subordinated certificates outstanding. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities (Notes) | 12 Months Ended |
May 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | NOTE 10—DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES We are an end user of derivative financial instruments and do not engage in derivative trading. We use derivatives, primarily interest rate swaps and Treasury rate locks, to manage interest rate risk. Derivatives may be privately negotiated contracts, which are often referred to as OTC derivatives, or they may be listed and traded on an exchange. We generally engage in OTC derivative transactions. Outstanding Notional Amount and Maturities of Derivatives Not Designated as Accounting Hedges The notional amount provides an indication of the volume of our derivatives activity, but this amount is not recorded on our consolidated balance sheets. The notional amount is used only as the basis on which interest payments are determined and is not the amount exchanged. The following table shows the outstanding notional amounts and the weighted-average rate paid and received for our interest rate swaps, by type, as of May 31, 2020 and 2019 . The substantial majority of our interest rate swaps use an index based on LIBOR for either the pay or receive leg of the swap agreement. May 31, 2020 2019 (Dollars in thousands) Notional Amount Weighted- Average Rate Paid Weighted- Average Rate Received Notional Weighted- Weighted- Pay-fixed swaps $ 6,604,808 2.78 % 0.88 % $ 7,379,280 2.83 % 2.60 % Receive-fixed swaps 2,699,000 1.54 2.75 3,399,000 3.25 2.56 Total interest rate swaps 9,303,808 2.42 1.42 10,778,280 2.97 2.58 Forward pay-fixed swaps 3,000 65,000 Total $ 9,306,808 $ 10,843,280 The following table presents the maturities for each of the next five fiscal years and thereafter based on the notional amount of our interest rate swaps as of May 31, 2020 . Notional Amount Notional Amortization and Maturities (Dollars in thousands) 2021 2022 2023 2024 2025 Thereafter Interest rate swaps $9,306,808 $466,602 $749,854 $323,082 $655,899 $100,000 $7,011,371 Cash Flow Hedge In anticipation of the repricing of $100 million in notes payable outstanding under the Guaranteed Underwriter Program, we entered into a Treasury rate lock agreement with a notional amount of $100 million on May 25, 2018. The agreement, which was scheduled to mature on October 12, 2018, was designated as a cash flow hedge of the forecasted transaction. We recorded an unrealized loss in AOCI of $1 million as of May 31, 2018 related to this cash flow hedge. On September 25, 2018, we terminated this cash flow hedge as the forecasted transaction was no longer expected to occur. Upon termination, the fair value of the derivative had shifted to a gain of $1 million from a loss of $1 million as of May 31, 2018 . We reversed the loss recorded in AOCI and recognized the gain in earnings as a component of derivative gains on our consolidated statements of operations as of May 31, 2019 . Impact of Derivatives on Consolidated Balance Sheets The following table displays the fair value of the derivative assets and derivative liabilities recorded on our consolidated balance sheets and the related outstanding notional amount of our interest rate swaps by derivatives type as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Fair Value Notional Balance Fair Value Notional Balance Derivative assets: Interest rate swaps $ 173,195 $ 2,699,000 $ 41,179 $ 2,332,104 Derivative liabilities: Interest rate swaps $ 1,258,459 $ 6,607,808 $ 391,724 $ 8,511,176 All of our master swap agreements include netting provisions that allow for offsetting of all contracts with a given counterparty in the event of default by one of the two parties. However, as indicated above, in “Note 1—Summary of Significant Accounting Policies,” we report derivative asset and liability amounts on a gross basis by individual contracts. The following table presents the gross fair value of derivative assets and liabilities reported on our consolidated balance sheets as of May 31, 2020 and 2019 , and provides information on the impact of netting provisions and collateral pledged. May 31, 2020 Gross Amount of Recognized Assets/ Liabilities Gross Amount Offset in the Balance Sheet Net Amount of Assets/ Liabilities Presented in the Balance Sheet Gross Amount Not Offset in the Balance Sheet (Dollars in thousands) Financial Instruments Cash Collateral Pledged Net Amount Derivative assets: Interest rate swaps $ 173,195 $ — $ 173,195 $ 173,195 $ — $ — Derivative liabilities: Interest rate swaps 1,258,459 — 1,258,459 173,195 — 1,085,264 May 31, 2019 Gross Amount Gross Amount Net Amount of Assets/ Liabilities Gross Amount (Dollars in thousands) Financial Cash Net Derivative assets: Interest rate swaps $ 41,179 $ — $ 41,179 $ 41,176 $ — $ 3 Derivative liabilities: Interest rate swaps 391,724 — 391,724 41,176 — 350,548 Impact of Derivatives on Consolidated Statements of Operations Derivative gains (losses) reported in our consolidated statements of operations consist of derivative cash settlements expense and derivative forward value gains (losses). Derivative cash settlements expense represents net contractual interest expense accruals on interest rate swaps during the period. The derivative forward value gains (losses) represent the change in fair value of our interest rate swaps during the reporting period due to changes in the estimate of future interest rates over the remaining life of our derivative contracts. The following table presents the components of the derivative gains (losses) reported in our consolidated statements of operations for our interest rate swaps for fiscal years 2020 , 2019 and 2018 . Year Ended May 31, (Dollars in thousands) 2020 2019 2018 Derivative gains (losses) attributable to: Derivative cash settlements expense $ (55,873 ) $ (43,611 ) $ (74,281 ) Derivative forward value gains (losses) (734,278 ) (319,730 ) 306,002 Derivative gains (losses) $ (790,151 ) $ (363,341 ) $ 231,721 As noted above, during fiscal year 2018 , we entered into a treasury rate lock agreement that was designated as a cash flow hedge of a forecasted transaction. This cash flow hedge was terminated on September 25, 2018 and a gain of $1 million was recorded upon termination as a component of derivative cash settlements expense in our consolidated statements of operations during fiscal year 2019 . Credit Risk-Related Contingent Features Our derivative contracts typically contain mutual early-termination provisions, generally in the form of a credit rating trigger. Under the mutual credit rating trigger provisions, either counterparty may, but is not obligated to, terminate and settle the agreement if the credit rating of the other counterparty falls below a level specified in the agreement. If a derivative contract is terminated, the amount to be received or paid by us would be equal to the prevailing fair value, as defined in the agreement, as of the termination date. Our senior unsecured credit ratings from Moody’s and S&P were A2 and A, respectively, as of May 31, 2020 . Both Moody’s and S&P had our ratings on stable outlook as of May 31, 2020 . The following table displays the notional amounts of our derivative contracts with rating triggers as of May 31, 2020 , and the payments that would be required if the contracts were terminated as of that date because of a downgrade of our unsecured credit ratings or the counterparty’s unsecured credit ratings below A3/A-, below Baa1/BBB+, to or below Baa2/BBB, below Baa3/BBB-, or to or below Ba2/BB+ by Moody’s or S&P, respectively. In calculating the payment amounts that would be required upon termination of the derivative contracts, we assumed that the amounts for each counterparty would be netted in accordance with the provisions of the master netting agreements for each counterparty. The net payment amounts are based on the fair value of the underlying derivative instrument, excluding the credit risk valuation adjustment, plus any unpaid accrued interest amounts. (Dollars in thousands) Notional Amount Payable Due from CFC Receivable Due to CFC Net (Payable)/Receivable Impact of rating downgrade trigger: Falls below A3/A- (1) $ 45,860 $ (11,305 ) $ — $ (11,305 ) Falls below Baa1/BBB+ 6,091,198 (692,210 ) — (692,210 ) Falls to or below Baa2/BBB (2) 421,303 (33,958 ) — (33,958 ) Falls below Baa3/BBB- 45,280 (15,677 ) — (15,677 ) Total $ 6,603,641 $ (753,150 ) $ — $ (753,150 ) ___________________________ (1) Rating trigger for CFC falls below A3/A-, while rating trigger for counterparty falls below Baa1/BBB+ by Moody’s or S&P, respectively. (2) Rating trigger for CFC falls to or below Baa2/BBB, while rating trigger for counterparty falls to or below Ba2/BB+ by Moody’s or S&P, respectively. We have outstanding notional amount of derivatives with one counterparty subject to a ratings trigger and early termination provision in the event of a downgrade of CFC’s senior unsecured credit ratings below Baa3, BBB- or BBB- by Moody’s, S&P or Fitch, respectively, which is not included in the above table , totaling $166 million as of May 31, 2020 . These contracts were in an unrealized loss position of $62 million as of May 31, 2020 . Our largest counterparty exposure, based on the outstanding notional amount, accounted for approximately 25% and 23% of the total outstanding notional amount of derivatives as of May 31, 2020 and 2019 , respectively. The aggregate fair value amount, including the credit valuation adjustment, of all interest rate swaps with rating triggers that were in a net liability position was $798 million as of May 31, 2020 . |
Equity (Notes)
Equity (Notes) | 12 Months Ended |
May 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Equity | NOTE 11—EQUITY Total equity decreased by $655 million to $649 million as of May 31, 2020 . The decrease was primarily attributable to our reported net loss of $589 million for the year ended May 31, 2020 and the patronage capital retirement of $63 million during the second quarter of fiscal year 2020 . The following table presents the components of equity as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Membership fees $ 969 $ 969 Educational fund 2,224 2,013 Total membership fees and educational fund 3,193 2,982 Patronage capital allocated 894,066 860,578 Members’ capital reserve 807,320 759,097 Unallocated net income (loss): Prior year-end cumulative derivative forward value losses (348,965 ) (30,831 ) Current-year derivative forward value losses (1) (730,774 ) (318,134 ) Current year-end cumulative derivative forward value losses (1,079,739 ) (348,965 ) Other unallocated net income 3,191 3,190 Unallocated net loss (1,076,548 ) (345,775 ) CFC retained equity 628,031 1,276,882 Accumulated other comprehensive loss (1,910 ) (147 ) Total CFC equity 626,121 1,276,735 Noncontrolling interests 22,701 27,147 Total equity $ 648,822 $ 1,303,882 ____________________________ (1) Represents derivative forward value gains (losses) for CFC only, as total CFC equity does not include the noncontrolling interests of the consolidated variable interest entities NCSC and RTFC. See “Note 15—Business Segments” for the statements of operations for CFC. Allocation of Net Earnings and Retirement of Patronage Capital—CFC District of Columbia cooperative law requires cooperatives to allocate net earnings to patrons, to a general reserve in an amount sufficient to maintain a balance of at least 50% of paid-in capital and to a cooperative educational fund, as well as permits additional allocations to board-approved reserves. District of Columbia cooperative law also requires that a cooperative’s net earnings be allocated to all patrons in proportion to their individual patronage and each patron’s allocation be distributed to the patron unless the patron agrees that the cooperative may retain its share as additional capital. Annually, the CFC Board of Directors allocates its net earnings to its patrons in the form of patronage capital, to a cooperative educational fund, to a general reserve, if necessary, and to board-approved reserves. An allocation to the general reserve is made, if necessary, to maintain the balance of the general reserve at 50% of the membership fees collected. CFC’s bylaws require the allocation to the cooperative educational fund to be at least 0.25% of its net earnings. Funds from the cooperative educational fund are disbursed annually to statewide cooperative organizations to fund the teaching of cooperative principles and for other cooperative education programs. Currently, CFC has one additional board-approved reserve, the members’ capital reserve. The CFC Board of Directors determines the amount of net earnings that is allocated to the members’ capital reserve, if any. The members’ capital reserve represents net earnings that CFC holds to increase equity retention. The net earnings held in the members’ capital reserve have not been specifically allocated to members, but may be allocated to individual members in the future as patronage capital if authorized by the CFC Board of Directors. All remaining net earnings are allocated to CFC’s members in the form of patronage capital. The amount of net earnings allocated to each member is based on the member’s patronage of CFC’s lending programs during the year. No interest is earned by members on allocated patronage capital. There is no effect on CFC’s total equity as a result of allocating net earnings to members in the form of patronage capital or to board-approved reserves. The CFC Board of Directors has voted annually to retire a portion of the patronage capital allocation. Upon retirement, patronage capital is paid out in cash to the members to whom it was allocated. CFC’s total equity is reduced by the amount of patronage capital retired to its members and by amounts disbursed from board-approved reserves. CFC’s net earnings for determining allocations is based on CFC’s non-GAAP adjusted net income, which excludes the impact of derivative forward value gains and losses. The current policy of the CFC Board of Directors is to retire 50% of the prior year’s allocated patronage capital and hold the remaining 50% for 25 years . The retirement amount and timing is subject to annual approval by the CFC Board of Directors. In May 2020 , the CFC Board of Directors authorized the allocation of $1 million of net earnings for fiscal year 2020 to the cooperative educational fund. In July 2020 , the CFC Board of Directors authorized the allocation of net earnings for fiscal year 2020 as follows: $96 million to members in the form of patronage capital and $48 million to the members’ capital reserve. In July 2020 , the CFC Board of Directors also authorized the retirement of patronage capital totaling $60 million , of which $48 million represented 50% of the patronage capital allocation for fiscal year 2020 and $12 million represented the portion of the allocation from net earnings for fiscal year 1995 that has been held for 25 years pursuant to the CFC Board of Directors’ policy. We expect to return the authorized patronage capital retirement amount of $60 million to members in cash in the second quarter of fiscal year 2021 . The remaining portion of the patronage capital allocation for fiscal year 2020 will be retained by CFC for 25 years pursuant to the guidelines adopted by the CFC Board of Directors in June 2009. In July 2019 , the CFC Board of Directors authorized the allocation of net earnings for fiscal year 2019 as follows: $97 million to members in the form of patronage capital, $71 million to the members’ capital reserve and $1 million to the cooperative educational fund. In July 2019 , the CFC Board of Directors also authorized the retirement of patronage capital totaling $63 million , of which $48 million represented 50% of the patronage capital allocation for fiscal year 2019 and $15 million represented the portion of the allocation from net earnings for fiscal year 1994 that has been held for 25 years pursuant to the CFC Board of Directors’ policy. This amount was returned to members in cash in September 2019 . The remaining portion of the patronage capital allocation for fiscal year 2019 will be retained by CFC for 25 years pursuant to the guidelines adopted by the CFC Board of Directors in June 2009. Future allocations and retirements of net earnings may be made annually as determined by the CFC Board of Directors with due regard for its financial condition. The CFC Board of Directors has the authority to change the current practice for allocating and retiring net earnings at any time, subject to applicable laws and regulations. CFC’s total equity includes noncontrolling interests, which consist of 100% of the equity of NCSC and RTFC, as the members of NCSC and RTFC own or control 100% of the interests in their respective companies. NCSC and RTFC also allocate annual net earnings, subject to approval by the board of directors for each company. The allocation of net earnings by NCSC and RTFC to members or board-approved reserves does not affect noncontrolling interests; however, the cash retirement of amounts allocated to members or to disbursements from board-approved reserves results in a reduction to noncontrolling interests. Allocation of Net Earnings and Retirement of Patronage Capital—RTFC In accordance with District of Columbia cooperative law and its bylaws and board policies, RTFC allocates its net earnings to its patrons, a cooperative educational fund and a general reserve, if necessary. RTFC’s bylaws require that it allocate at least 1% of net income to a cooperative educational fund. Funds from the cooperative educational fund are disbursed annually to fund the teaching of cooperative principles and for other cooperative education programs. An allocation to the general reserve is made, if necessary, to maintain the balance of the general reserve at 50% of the membership fees collected. The remainder is allocated to borrowers in proportion to their patronage. RTFC retires at least 20% of its annual allocation, if any, to members in cash prior to filing the applicable tax return. Any additional amounts are retired as determined by the RTFC Board of Directors taking into consideration RTFC’s financial condition. Allocation of Net Earnings—NCSC NCSC’s bylaws require that it allocate at least 0.25% of its net earnings to a cooperative educational fund and an amount to the general reserve required to maintain the general reserve balance at 50% of membership fees collected. Funds from the cooperative educational fund are disbursed annually to fund the teaching of cooperative principles and for other cooperative education programs. Accumulated Other Comprehensive Income (Loss) The following tables summarize, by component, the activity in AOCI as of and for the years ended May 31, 2020 and 2019 . Year Ended May 31, 2020 (Dollars in thousands) Unrealized Gains (Losses) Equity Securities Unrealized Gains (1) Unrealized Gains (Losses) Cash Flow Hedges Unrealized Losses Defined Benefit Plan (2) Total Beginning balance $ — $ 2,571 $ — $ (2,718 ) $ (147 ) Gains reclassified into earnings — (441 ) — — (441 ) Defined benefit plan adjustments — — — (1,322 ) (1,322 ) Other comprehensive loss — (441 ) — (1,322 ) (1,763 ) Ending balance $ — $ 2,130 $ — $ (4,040 ) $ (1,910 ) Year Ended May 31, 2019 (Dollars in thousands) Unrealized Gains (Losses) Equity Securities Unrealized Gains Derivatives (1) Unrealized Gains (Losses) Cash Flow Hedges Unrealized Losses Defined Benefit Plan (2) Total Beginning balance $ 8,794 $ 3,039 $ (1,059 ) $ (2,230 ) $ 8,544 Cumulative effect of changes from adoption of new accounting standards (8,794 ) — — — (8,794 ) Unrealized gains — — 1,059 — 1,059 Gains reclassified into earnings — (468 ) — — (468 ) Defined benefit plan adjustments — — — (488 ) (488 ) Other comprehensive income (loss) — (468 ) 1,059 (488 ) 103 Ending balance $ — $ 2,571 $ — $ (2,718 ) $ (147 ) ____________________________ (1) Amounts are reclassified into income in the derivative forward value gains (losses) component of the derivative gains (losses) line item of our consolidated statements of operations. (2) Amounts are reclassified into income in the other general and administrative expenses line item of our consolidated statements of operations. We expect to reclassify less than $1 million of amounts in AOCI related to unrealized derivative gains into earnings over the next 12 months. |
Employee Benefits (Notes)
Employee Benefits (Notes) | 12 Months Ended |
May 31, 2020 | |
Retirement Benefits [Abstract] | |
Employee Benefits | NOTE 12—EMPLOYEE BENEFITS National Rural Electric Cooperative Association (“NRECA”) Retirement Security Plan CFC is a participant in the NRECA Retirement Security Plan (“the Retirement Security Plan”), a multiple-employer defined benefit pension plan. The employer identification number of the Retirement Security Plan is 53-0116145, and the plan number is 333. Plan information is available publicly through the annual Form 5500, including attachments. The Retirement Security Plan is a qualified plan in which all employees are eligible to participate upon completion of one year of service. Under this plan, participating employees are entitled to receive annually, under a 50% joint and surviving spouse annuity, 1.70% of the average of their five highest base salaries during their participation in the plan, multiplied by the number of years of participation in the plan. The risks of participating in the multiple-employer plan are different from the risks of single-employer plans due to the following characteristics of the plan: • Assets contributed to the multiple-employer plan by one participating employer may be used to provide benefits to employees of other participating employers. • If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. • If CFC chooses to stop participating in the plan, CFC may be required to pay a withdrawal liability representing an amount based on the underfunded status of the Plan. Because of the current funding status of the Retirement Security Plan, it is not subject to a certified zone status determination under the Pension Protection Act of 2006 (“PPA”). Based on the PPA target and PPA actuarial value of the plan assets, it was more than 80% funded as of January 1, 2020 , 2019 and 2018 . We made contributions to the Retirement Security Plan of $5 million in each of fiscal years 2020 , 2019 and 2018 , respectively. In each of these years, our contribution represented less than 5% of total contributions made to the plan by all participating employers. Our contribution did not include a surcharge. CFC’s expense is limited to the annual premium to participate in the Retirement Security Plan. Because it is a multiple-employer plan, there is no funding liability for CFC for the plan. There were no funding improvement plans, rehabilitation plans implemented or pending, and no required minimum contributions. There are no collective bargaining agreements in place that cover CFC’s employees. Pension Restoration Plan The Pension Restoration Plan (“PRP”) is a nonqualified defined benefit plan established to provide supplemental benefits to certain eligible employees whose compensation exceeds the IRS limits for the qualified Retirement Security Plan. The PRP restores the value of the Retirement Security Plan for eligible officers to the level it would be if the IRS limits on annual pay and annual annuity benefits were not in place. The limit was $285,000 for calendar year 2020 . The PRP, which is administered by NRECA, was frozen as of December 31, 2014. The benefit and payout formula under the nonqualified PRP component of the Retirement Security Plan is similar to that under the qualified plan component. Under the PRP, the amount NRECA invoices us for the Retirement Security Plan is based on the full compensation paid to each covered employee. Upon retirement of an employee covered under the PRP, NRECA will calculate the retirement benefits to be paid both with and without consideration of the IRS compensation limits. We will then pay the nonqualified supplemental benefit to the covered employee. NRECA will provide a credit for supplemental benefit payments made by us to covered employees against future contributions we are required to make to the Retirement Security Plan. The two participating executive officers have satisfied the provisions established to receive the benefit from this plan. Since there is no longer a risk of forfeiture of the benefit under the PRP, we will make distributions of any earned benefit from the plan to each of the executive officers included in the plan and the distributions will be credited back to us by NRECA. Accordingly, the distributions have no impact on our consolidated financial statements. Executive Benefit Restoration Plan NRECA restricted additional participation in the PRP in December 2014. We therefore adopted a supplemental top-hat Executive Benefit Restoration (“EBR”) Plan, effective January 1, 2015. The EBR Plan is a nonqualified, unfunded plan maintained by CFC to provide retirement benefits to a select group of executive officers whose compensation exceeds IRS limits for qualified defined benefit plans. There is a risk of forfeiture if participants leave the company prior to becoming fully vested in the EBR Plan. There were seven plan participants as of May 31, 2020 . The unfunded projected benefit obligation of this plan, which is included on our consolidated balance sheets as a component of other liabilities, was $7 million and $6 million as of May 31, 2020 and 2019 , respectively. We recognized pension expense for this plan of approximatively $2 million , $1 million and $1 million in fiscal years 2020 , 2019 and 2018 , respectively. Accumulated other comprehensive income as of May 31, 2020 includes net unrecognized pension costs of $4 million , of which $1 million is expected to be amortized into benefit cost during fiscal year 2021. During fiscal year 2020 , we recognized settlement losses of $1 million in connection with a $2 million lump-sum benefit distribution from the EBR Plan that was funded by contributions from CFC. The settlement losses were recorded as a component of non-interest expense on our consolidated statements of operations for fiscal year 2020 . Two plan participants who became fully vested received their EBR Plan benefit payments in the form of lump-sum settlements. Pro-rata settlement losses, which can occasionally occur as a result of these lump-sum distributions, are recognized only in years when the total of such distributions exceeds the sum of the service and interest expense components of net periodic benefit cost. Defined Contribution Plan CFC offers a 401(k) defined contribution savings program, the 401(k) Pension Plan, to all employees who have completed a minimum of 1,000 hours of service in either the first 12 consecutive months or first full calendar year of employment. We contribute an amount up to 2% of an employee’s salary each year for all employees participating in the program with a minimum 2% employee contribution. We contributed approximatively $1 million to the plan in each of fiscal years 2020 , 2019 and 2018 . |
Guarantees (Notes)
Guarantees (Notes) | 12 Months Ended |
May 31, 2020 | |
Guarantees [Abstract] | |
Guarantees | NOTE 13—GUARANTEES We guarantee certain contractual obligations of our members so they may obtain various forms of financing. We use the same credit policies and monitoring procedures in providing guarantees as we do for loans and commitments. If a member system defaults on its obligation to pay debt service, then we are obligated to pay any required amounts under our guarantees. Meeting our guarantee obligations satisfies the underlying obligation of our member systems and prevents the exercise of remedies by the guarantee beneficiary based upon a payment default by a member system. In general, the member system is required to repay any amount advanced by us with interest, pursuant to the documents evidencing the member system’s reimbursement obligation. The following table summarizes total guarantees, by type of guarantee and by member class, as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Guarantee type: Long-term tax-exempt bonds (1) $ 263,875 $ 312,190 Letters of credit (2) 413,839 379,001 Other guarantees 143,072 146,244 Total $ 820,786 $ 837,435 Member class: CFC: Distribution $ 266,301 $ 235,919 Power supply 538,532 586,717 Statewide and associate (3) 5,954 4,708 CFC total 810,787 827,344 NCSC 9,999 8,517 RTFC — 1,574 Total $ 820,786 $ 837,435 ____________________________ (1) Represents the outstanding principal amount of long-term fixed-rate and variable-rate guaranteed bonds. (2) Reflects our maximum potential exposure for letters of credit. (3) Includes CFC guarantees to NCSC and RTFC members totaling $3 million and $1 million as of May 31, 2020 and 2019 , respectively. We guarantee debt issued in connection with the construction or acquisition of pollution control, solid waste disposal, industrial development and electric distribution facilities, classified as long-term tax-exempt bonds in the table above. We unconditionally guarantee to the holders or to trustees for the benefit of holders of these bonds the full principal, interest, and in most cases, premium, if any, on each bond when due. If a member system defaults in its obligation to pay debt service, then we are obligated to pay any required amounts under our guarantees. Such payment will prevent the occurrence of an event of default that would otherwise permit acceleration of the bond issue. In general, the member system is required to repay any amount advanced by us with interest, pursuant to the documents evidencing the member system’s reimbursement obligation. Long-term tax-exempt bonds of $264 million and $312 million as of May 31, 2020 and 2019 , respectively, included $244 million and $247 million , respectively, of adjustable or variable-rate bonds that may be converted to a fixed rate as specified in the applicable indenture for each bond offering. We are unable to determine the maximum amount of interest that we may be required to pay related to the remaining adjustable and variable-rate bonds. Many of these bonds have a call provision that allows us to call the bond in the event of a default, which would limit our exposure to future interest payments on these bonds. Our maximum potential exposure generally is secured by mortgage liens on the members’ assets and future revenue. If a member’s debt is accelerated because of a determination that the interest thereon is not tax-exempt, the member’s obligation to reimburse us for any guarantee payments will be treated as a long-term loan. The remaining long-term tax-exempt bonds of $20 million as of May 31, 2020 are fixed-rate. The maximum potential exposure for these bonds, including the outstanding principal of $20 million and related interest through maturity, totaled $34 million as of May 31, 2020 . The maturities for long-term tax-exempt bonds and the related guarantees extend through calendar year 2040. Of the outstanding letters of credit of $414 million and $379 million as of May 31, 2020 and 2019 , respectively, $106 million and $126 million , respectively, were secured. We did not have any letters of credit outstanding that provided for standby liquidity for adjustable and floating-rate tax-exempt bonds issued for the benefit of our members as of May 31, 2020 . The maturities for the outstanding letters of credit as of May 31, 2020 extend through calendar year 2039. In addition to the letters of credit listed in the table above, under master letter of credit facilities in place as of May 31, 2020 , we may be required to issue up to an additional $70 million in letters of credit to third parties for the benefit of our members. All of our master letter of credit facilities were subject to material adverse change clauses at the time of issuance as of May 31, 2020 . Prior to issuing a letter of credit, we would confirm there has been no material adverse change in the business or condition, financial or otherwise, of the borrower since the time the loan was approved and confirm that the borrower is currently in compliance with the letter of credit terms and conditions. The maximum potential exposure for other guarantees was $143 million and $147 million as of May 31, 2020 and 2019 , respectively, of which $25 million was secured as of both May 31, 2020 and 2019 . The maturities for these other guarantees listed in the table above extend through calendar year 2025. Guarantees under which our right of recovery from our members was not secured totaled $426 million and $374 million and represented 52% and 45% of total guarantees as of May 31, 2020 and 2019 , respectively. In addition to the guarantees described above, we were also the liquidity provider for $244 million of variable-rate tax-exempt bonds as of May 31, 2020 , issued for our member cooperatives. While the bonds are in variable-rate mode, in return for a fee, we have unconditionally agreed to purchase bonds tendered or put for redemption if the remarketing agents are unable to sell such bonds to other investors. We were not required to perform as liquidity provider pursuant to these obligations during fiscal years 2020 , 2019 or 2018 . Guarantee Liability As of May 31, 2020 and 2019 , we recorded a guarantee liability of $11 million and $14 million , respectively, which represents the contingent and noncontingent exposures related to guarantees and liquidity obligations. The contingent guarantee liability was $1 million as of both May 31, 2020 and 2019 , based on management’s estimate of exposure to losses within the guarantee portfolio. The remaining balance of the total guarantee liability of $10 million and $13 million as of May 31, 2020 and 2019 , respectively, relates to our noncontingent obligation to stand ready to perform over the term of our guarantees and liquidity obligations we have entered into or modified since January 1, 2003. The following table details the scheduled maturities of our outstanding guarantees in each of the five fiscal years following May 31, 2020 and thereafter: (Dollars in thousands) Amount Maturing 2021 $ 339,979 2022 29,265 2023 157,411 2024 32,824 2025 83,628 Thereafter 177,679 Total $ 820,786 |
Fair Value Measurement (Notes)
Fair Value Measurement (Notes) | 12 Months Ended |
May 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | NOTE 14—FAIR VALUE MEASUREMENT We use fair value measurements for the initial recording of certain assets and liabilities and periodic remeasurement of certain assets and liabilities on a recurring or nonrecurring basis. The accounting guidance for fair value measurements and disclosures establishes a three-level fair value hierarchy that prioritizes the inputs into the valuation techniques used to measure fair value. The levels of the fair value hierarchy, in priority order, include Level 1, Level 2 and Level 3. We describe the valuation technique for each level in “Note 1—Summary of Significant Accounting Policies.” The following tables present the carrying value and fair value for all of our financial instruments, including those carried at amortized cost, as of May 31, 2020 and 2019 . The tables also display the classification within the fair value hierarchy of the valuation technique used in estimating fair value. May 31, 2020 Fair Value Measurement Level (Dollars in thousands) Carrying Value Fair Value Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 671,372 $ 671,372 $ 671,372 $ — $ — Restricted cash 8,647 8,647 8,647 — — Equity securities 60,735 60,735 60,735 — — Debt securities trading 309,400 309,400 — 309,400 — Deferred compensation investments 5,496 5,496 5,496 — — Loans to members, net 26,649,255 29,252,065 — — 29,252,065 Accrued interest receivable 117,138 117,138 — 117,138 — Debt service reserve funds 14,591 14,591 14,591 — — Derivative assets 173,195 173,195 — 173,195 — Liabilities: Short-term borrowings $ 3,961,985 $ 3,963,164 $ — $ 3,713,164 $ 250,000 Long-term debt 19,712,024 21,826,337 — 11,981,580 9,844,757 Accrued interest payable 139,619 139,619 — 139,619 — Guarantee liability 10,937 11,948 — — 11,948 Derivative liabilities 1,258,459 1,258,459 — 1,258,459 — Subordinated deferrable debt 986,119 1,030,108 — 1,030,108 — Members’ subordinated certificates 1,339,618 1,339,618 — — 1,339,618 May 31, 2019 Fair Value Measurement Level (Dollars in thousands) Carrying Value Fair Value Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 177,922 $ 177,922 $ 177,922 $ — $ — Restricted cash 8,282 8,282 8,282 — — Equity securities 87,533 87,533 87,533 — — Debt securities held-to-maturity 565,444 570,549 — 570,549 — Deferred compensation investments 4,984 4,984 4,984 — — Loans to members, net 25,899,369 25,743,503 — — 25,743,503 Accrued interest receivable 133,605 133,605 — 133,605 — Debt service reserve funds 17,151 17,151 17,151 — — Derivative assets 41,179 41,179 — 41,179 — Liabilities: Short-term borrowings $ 3,607,726 $ 3,608,259 $ — $ 3,608,259 $ — Long-term debt 19,210,793 20,147,183 — 11,482,715 8,664,468 Accrued interest payable 158,997 158,997 — 158,997 — Guarantee liability 13,666 13,307 — — 13,307 Derivative liabilities 391,724 391,724 — 391,724 — Subordinated deferrable debt 986,020 1,004,707 — 1,004,707 — Members’ subordinated certificates 1,357,129 1,357,129 — — 1,357,129 Loans to Members, Net Because of the interest rate repricing options we provide to borrowers on loan advances and other characteristics of our loans, there is no ready market from which to obtain fair value quotes or observable inputs for similar loans. As a result, we are unable to use the exit price to estimate the fair value of loans to members. We therefore estimate fair value for fixed-rate loans by discounting the expected future cash flows based on the current rate at which we would make a similar new loan for the same remaining maturity to a borrower. The assumed maturity date used in estimating the fair value of loans with a fixed rate for a selected rate term is the next repricing date because at the repricing date, the loan will reprice at the current market rate. The carrying value of our variable-rate loans adjusted for credit risk approximates fair value since variable-rate loans are eligible to be reset at least monthly. The fair value of loans with different risk characteristics, specifically nonperforming and restructured loans, is estimated using collateral valuations or by adjusting cash flows for credit risk and discounting those cash flows using the current rates at which similar loans would be made by us to borrowers for the same remaining maturities. See below for information on how we estimate the fair value of certain impaired loans. Recurring Fair Value Measurements The following table presents the carrying value and fair value of financial instruments reported in our consolidated financial statements at fair value on a recurring basis as of May 31, 2020 and 2019 and the classification of the valuation technique within the fair value hierarchy. May 31, 2020 2019 (Dollars in thousands) Level 1 Level 2 Total Level 1 Level 2 Total Equity securities $ 60,735 $ — $ 60,735 $ 87,533 $ — $ 87,533 Debt securities trading — 309,400 309,400 — — — Deferred compensation investments 5,496 — 5,496 4,984 — 4,984 Derivative assets — 173,195 173,195 — 41,179 41,179 Derivative liabilities — 1,258,459 1,258,459 — 391,724 391,724 Below is a description of the valuation techniques we use to estimate fair value of our financial assets and liabilities recorded at fair value on a recurring basis, the significant inputs used in those techniques, if applicable, and the classification within the fair value hierarchy. Equity Securities Our investments in equity securities consist of investments in Farmer Mac Class A common stock and Series A, Series B and Series C preferred stock. These securities are reported at fair value in our consolidated balance sheets. We determine the fair value based on quoted prices on the stock exchange where the stock is traded. That stock exchange with respect to Farmer Mac Class A common stock is an active market based on the volume of shares transacted. Fair values for these securities are classified within Level 1 of the fair value hierarchy. Debt Securities Trading As discussed above in “Note 1—Summary of Significant Accounting Policies” our debt securities consist of investments in certificates of deposit with maturities greater than 90 days, corporate debt securities, municipality debt securities, commercial MBS and other ABS and were classified as trading as of May 31, 2020 . We previously classified our investments in debt securities as held to maturity as of May 31, 2019. During the fourth quarter of fiscal year 2020, in light of the extreme volatility and disruptions in the capital and credit markets in early March 2020 resulting from the COVID-19 pandemic, we transferred the debt securities in our held-to-maturity investment portfolio to trading, as we revised our objective for the use of our held-to-maturity investment portfolio from previously serving as a supplemental source of liquidity to serving as a readily available source of liquidity. Management estimates the fair value of our debt securities utilizing the assistance of third-party pricing services. Methodologies employed, controls relied upon and inputs used by third-party pricing vendors are subject to management review when such services are provided. This review may consist of, in part, obtaining and evaluating control reports issued and pricing methodology materials distributed. We review the pricing methodologies provided by the vendors in order to determine if observable market information is being used to determine the fair value versus unobservable inputs. Investment securities traded in secondary markets are typically valued using unadjusted vendor prices. These investment securities, which include those measured using unadjusted vendor prices, are generally classified as Level 2 because the valuation typically involves using quoted market prices for similar securities, pricing models, discounted cash flow analyses using significant observable market where available or a combination of multiple valuation techniques for which all significant assumptions are observable in the market. Deferred Compensation Investments CFC offers a nonqualified 457(b) deferred compensation plan to highly compensated employees and board members. Such amounts deferred by employees are invested by the company. The deferred compensation investments are presented as other assets in the consolidated balance sheets in the other assets category at fair value. We calculate fair value based on the daily published and quoted net asset value, and these investments are classified within Level 1 of the fair value hierarchy. Derivative Instruments Our derivatives primarily consist of over-the-counter interest rate swaps. All of our swap agreements are subject to master netting agreements. There is not an active secondary market for the types of interest rate swaps we use. We determine the fair value of our derivatives using models that incorporate observable market inputs, such as spot LIBOR rates, Eurodollar futures contracts and market swap rates. These inputs can vary depending on the type of derivative and nature of the underlying rate, price or index upon which the derivative’s value is based. The impact of counterparty nonperformance risk is considered when measuring the fair value of derivative assets. Internal pricing is compared against additional pricing sources, such as external valuation agents and other sources. Pricing variances among different pricing sources are analyzed and validated. The technique for determining the fair value for our interest rate swaps is classified as Level 2. Transfers Between Levels We monitor the availability of observable market data to assess the appropriate classification of financial instruments within the fair value hierarchy and transfer between Level 1, Level 2 and Level 3 accordingly. Observable market data includes, but is not limited to, quoted prices and market transactions. Changes in economic conditions or market liquidity generally will drive changes in availability of observable market data. Changes in availability of observable market data, which also may result in changes in the valuation technique used, are generally the cause of transfers between levels. We did not have any transfers between levels for financial instruments measured at fair value on a recurring basis for the fiscal years ended May 31, 2020 and 2019 . Nonrecurring Fair Value Measurements We may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis on our consolidated balance sheets. These assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, such as in the application of lower of cost or fair value accounting or when we evaluate for impairment. Assets measured at fair value on a nonrecurring basis and still held during fiscal years ended May 31, 2020 and 2019 consisted of certain impaired loans. Fair value measurement adjustments for individually impaired loans are recorded in the provision for loan losses on our consolidated statements of operations. The fair value of these assets is determined based on the use of significant unobservable inputs, which are considered Level 3 in the fair value hierarchy. We did not have any nonrecurring fair value measurement adjustments recorded in earnings attributable to these assets during fiscal years 2020 , 2019 or 2018 . Significant Unobservable Level 3 Inputs Impaired Loans The fair value of impaired loans is typically measured based on the present value of expected future cash flows. Our estimate of expected future cash flows incorporates, among other items, assumptions regarding default rates, loss severities, the amounts and timing of prepayments, as well as the characteristics of the loan. If we expect repayment to be provided solely by the continued operation or sale of the underlying collateral, the fair value of the collateral less estimated costs to sell is used as the basis for measuring fair value. We employ various approaches and techniques to determine the fair value of collateral-dependent loans, including developing market multiples and obtaining valuations from third-party specialists. The significant unobservable inputs used in measuring the fair value of collateral-dependent loans include estimated cash flows before interest, taxes, depreciation and amortization and market multiples for comparable companies. Our Credit Risk Management group reviews the unobservable inputs to assess the reasonableness of the assumptions used and the accuracy of the work performed. We did not have any impaired collateral-dependent loans as of May 31, 2020 or May 31, 2019 . |
Business Segments (Notes)
Business Segments (Notes) | 12 Months Ended |
May 31, 2020 | |
Segment Reporting [Abstract] | |
Business Segments | NOTE 15—BUSINESS SEGMENTS Our consolidated financial statements include the financial results of CFC, NCSC and RTFC and certain entities created and controlled by CFC to hold foreclosed assets. Separate financial statements are produced for CFC, NCSC and RTFC and are the primary reports that management reviews in evaluating performance. The separate financial statements for CFC represent the consolidation of the financial results for CFC and the entities controlled by CFC. For more detail on the requirement to consolidate the financial results of NCSC and RTFC see “Note 1—Summary of Significant Accounting Policies.” The consolidated CFC financial statements include three operating segments: CFC, NCSC and RTFC. The NCSC and RTFC operating segments are not required to be separately reported as the financial results of NCSC and RTFC do not meet the quantitative thresholds outlined by the accounting standards for segment reporting as of May 31, 2020 . As a result, we have elected to aggregate the NCSC and RTFC financial results into a combined “Other” segment. CFC is the primary source of funding to NCSC. CFC is the sole source of funding to RTFC. Pursuant to a guarantee agreement, CFC has agreed to indemnify NCSC and RTFC for loan losses. The loan loss allowance at NCSC and RTFC is offset by a guarantee receivable from CFC. The following tables display segment results for the years ended May 31, 2020, 2019 and 2018 , and assets attributable to each segment as of May 31, 2020 and 2019 . Year Ended May 31, 2020 (Dollars in thousands) CFC Other Elimination Consolidated Statement of operations: Interest income $ 1,143,397 $ 47,107 $ (39,218 ) $ 1,151,286 Interest expense (820,841 ) (39,466 ) 39,218 (821,089 ) Net interest income 322,556 7,641 — 330,197 Provision for loan losses (35,590 ) — — (35,590 ) Net interest income after provision for loan losses 286,966 7,641 — 294,607 Non-interest income: Fee and other income 28,309 9,524 (14,872 ) 22,961 Derivative losses: Derivative cash settlements expense (54,707 ) (1,166 ) — (55,873 ) Derivative forward value losses (730,774 ) (3,504 ) — (734,278 ) Derivative losses (785,481 ) (4,670 ) — (790,151 ) Investment securities gains 9,431 — — 9,431 Total non-interest income (747,741 ) 4,854 (14,872 ) (757,759 ) Non-interest expense: General and administrative expenses (98,808 ) (8,940 ) 6,581 (101,167 ) Losses on early extinguishment of debt (69 ) (614 ) — (683 ) Other non-interest expense (25,588 ) (8,291 ) 8,291 (25,588 ) Total non-interest expense (124,465 ) (17,845 ) 14,872 (127,438 ) Loss before income taxes (585,240 ) (5,350 ) — (590,590 ) Income tax benefit — 1,160 — 1,160 Net loss $ (585,240 ) $ (4,190 ) $ — $ (589,430 ) May 31, 2020 CFC Other Elimination Consolidated Assets: Total loans outstanding $ 26,669,759 $ 1,083,197 $ (1,062,102 ) $ 26,690,854 Deferred loan origination costs 11,526 — — 11,526 Loans to members 26,681,285 1,083,197 (1,062,102 ) 26,702,380 Less: Allowance for loan losses (53,125 ) — — (53,125 ) Loans to members, net 26,628,160 1,083,197 (1,062,102 ) 26,649,255 Other assets 1,496,998 106,525 (95,173 ) 1,508,350 Total assets $ 28,125,158 $ 1,189,722 $ (1,157,275 ) $ 28,157,605 Year Ended May 31, 2019 (Dollars in thousands) CFC Other Elimination Consolidated Statement of operations: Interest income $ 1,126,869 $ 51,741 $ (42,940 ) $ 1,135,670 Interest expense (835,491 ) (43,658 ) 42,940 (836,209 ) Net interest income 291,378 8,083 — 299,461 Benefit for loan losses 1,266 — — 1,266 Net interest income after benefit for loan losses 292,644 8,083 — 300,727 Non-interest income: Fee and other income 20,515 2,655 (7,815 ) 15,355 Derivative losses: Derivative cash settlements expense (42,618 ) (993 ) — (43,611 ) Derivative forward value losses (318,135 ) (1,595 ) — (319,730 ) Derivative losses (360,753 ) (2,588 ) — (363,341 ) Investment securities losses (1,799 ) — — (1,799 ) Total non-interest income (342,037 ) 67 (7,815 ) (349,785 ) Non-interest expense: General and administrative expenses (91,063 ) (8,477 ) 6,374 (93,166 ) Losses on early extinguishment of debt (7,100 ) — — (7,100 ) Other non-interest expense (1,675 ) (1,441 ) 1,441 (1,675 ) Total non-interest expense (99,838 ) (9,918 ) 7,815 (101,941 ) Loss before income taxes (149,231 ) (1,768 ) — (150,999 ) Income tax expense — (211 ) — (211 ) Net loss $ (149,231 ) $ (1,979 ) $ — $ (151,210 ) May 31, 2019 CFC Other Elimination Consolidated Assets: Total loans outstanding $ 25,877,305 $ 1,087,988 $ (1,059,629 ) $ 25,905,664 Deferred loan origination costs 11,240 — — 11,240 Loans to members 25,888,545 1,087,988 (1,059,629 ) 25,916,904 Less: Allowance for loan losses (17,535 ) — — (17,535 ) Loans to members, net 25,871,010 1,087,988 (1,059,629 ) 25,899,369 Other assets 1,214,045 104,890 (93,932 ) 1,225,003 Total assets $ 27,085,055 $ 1,192,878 $ (1,153,561 ) $ 27,124,372 Year Ended May 31, 2018 (Dollars in thousands) CFC Other Elimination Consolidated Statement of operations: Interest income $ 1,067,016 $ 49,182 $ (38,841 ) $ 1,077,357 Interest expense (791,836 ) (39,740 ) 38,841 (792,735 ) Net interest income 275,180 9,442 — 284,622 Benefit for loan losses 18,575 — — 18,575 Net interest income after benefit for loan losses 293,755 9,442 — 303,197 Non-interest income: Fee and other income 17,369 1,372 (1,163 ) 17,578 Derivative gains (losses): Derivative cash settlements expense (71,906 ) (2,375 ) — (74,281 ) Derivative forward value gains 301,694 4,308 — 306,002 Derivative gains 229,788 1,933 — 231,721 Total non-interest income 247,157 3,305 (1,163 ) 249,299 Non-interest expense: General and administrative expenses (83,783 ) (7,101 ) — (90,884 ) Other non-interest expense (1,943 ) (1,163 ) 1,163 (1,943 ) Total non-interest expense (85,726 ) (8,264 ) 1,163 (92,827 ) Income before income taxes 455,186 4,483 — 459,669 Income tax expense — (2,305 ) — (2,305 ) Net income $ 455,186 $ 2,178 $ — $ 457,364 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
May 31, 2020 | |
Accounting Policies [Abstract] | |
General Information | The Company National Rural Utilities Cooperative Finance Corporation (“CFC”) is a member-owned cooperative association incorporated under the laws of the District of Columbia in April 1969. CFC’s principal purpose is to provide its members with financing to supplement the loan programs of the Rural Utilities Service (“RUS”) of the United States Department of Agriculture (“USDA”). CFC makes loans to its rural electric members so they can acquire, construct and operate electric distribution systems, generation and transmission (“power supply”) systems and related facilities. CFC also provides its members with credit enhancements in the form of letters of credit and guarantees of debt obligations. As a cooperative, CFC is owned by and exclusively serves its membership, which consists of not-for-profit entities or subsidiaries or affiliates of not-for-profit entities. CFC is exempt from federal income taxes. National Cooperative Services Corporation (“NCSC”) is a taxable cooperative incorporated in 1981 in the District of Columbia as a member-owned cooperative association. NCSC’s principal purpose is to provide financing to members of CFC, entities eligible to be members of CFC and the for-profit and nonprofit entities that are owned, operated or controlled by or provide significant benefit to certain members of CFC. NCSC’s membership consists of distribution systems, power supply systems and statewide and regional associations that are members of CFC. CFC is the primary source of funding for NCSC and manages NCSC’s business operations under a management agreement that is automatically renewable on an annual basis unless terminated by either party. NCSC pays CFC a fee and, in exchange, CFC reimburses NCSC for loan losses under a guarantee agreement. As a taxable cooperative, NCSC pays income tax based on its reported taxable income and deductions. NCSC is headquartered with CFC in Dulles, Virginia. Rural Telephone Finance Cooperative (“RTFC”) is a taxable Subchapter T cooperative association originally incorporated in South Dakota in 1987 and reincorporated as a member-owned cooperative association in the District of Columbia in 2005. RTFC’s principal purpose is to provide financing for its rural telecommunications members and their affiliates. RTFC’s membership consists of a combination of not-for-profit and for-profit entities. CFC is the sole lender to and manages the business operations of RTFC through a management agreement that is automatically renewable on an annual basis unless terminated by either party. RTFC pays CFC a fee and, in exchange, CFC reimburses RTFC for loan losses under a guarantee agreement. As permitted under Subchapter T of the Internal Revenue Code, RTFC pays income tax based on its net income, excluding patronage-sourced earnings allocated to its patrons. RTFC is headquartered with CFC in Dulles, Virginia. |
Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and related disclosures during the period. Management's most significant estimates and assumptions involve determining the allowance for loan losses and the fair value of financial assets and liabilities. Actual results could differ from these estimates. Certain reclassifications have been made to prior periods to conform to the current presentation. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of CFC, variable interest entities (“VIEs”) where CFC is the primary beneficiary and subsidiary entities created and controlled by CFC to hold foreclosed assets. CFC did no t have any entities that held foreclosed assets as of May 31, 2020 or May 31, 2019 . All intercompany balances and transactions have been eliminated. NCSC and RTFC are VIEs that are required to be consolidated by CFC. Unless stated otherwise, references to “we, “our” or “us” relate to CFC and its consolidated entities. |
Variable Interest Entities | Variable Interest Entities A VIE is an entity that has a total equity investment at risk that is not sufficient to finance its activities without additional subordinated financial support provided by another party, or where the group of equity holders does not have: (i) the ability to make decisions about the entity’s activities that most significantly impact its economic performance; (ii) the obligation to absorb the entity’s expected losses; or (iii) the right to receive the entity’s expected residual returns. NCSC and RTFC meet the definition of VIEs because they do not have sufficient equity investment at risk to finance their activities without additional financial support. When evaluating an entity for possible consolidation, we must determine whether or not we have a variable interest in the entity. If it is determined that we do not have a variable interest in the entity, no further analysis is required and we do not consolidate the entity. If we have a variable interest in the entity, we must evaluate whether we are the primary beneficiary based on an assessment of quantitative and qualitative factors. We are considered the primary beneficiary holder if we have a controlling financial interest in the VIE that provides (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. We consolidate the results of NCSC and RTFC with CFC because CFC is the primary beneficiary holder. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash, certificates of deposit, due from banks and other investments with original maturities of less than 90 days are classified as cash and cash equivalents. |
Restricted Cash | Restricted Cash Restricted cash, which consists primarily of member funds held in escrow for certain specifically designed cooperative programs, totaled $9 million and $8 million as of May 31, 2020 and 2019 |
Investments | Investment Securities We currently hold investments in equity and debt securities. We record purchases and sales of securities on a trade-date basis. The accounting and measurement framework for investment securities differs depending on the security type and the classification. Our equity securities consist of investments in Federal Agricultural Mortgage Corporation (“Farmer Mac”) Series A common stock and Farmer Mac Series A and Series C non-cumulative preferred stock. We previously had investments in equity securities that were classified as available for sale as of May 31, 2018. The unrealized gains and losses on these securities were recorded in other comprehensive income. Effective with our June 1, 2018 adoption of the financial instrument accounting standard on the recognition and measurement of financial assets and financial liabilities, unrealized gains and losses on equity securities are required to be recorded in earnings. Equity securities are carried at fair value on our consolidated balance sheets with unrealized gains and losses recorded as a component of other non-interest income. Our debt securities consist of investments in certificates of deposit with maturities greater than 90 days, corporate debt securities, municipality debt securities, commercial mortgage-backed securities (“MBS”) and other asset-backed securities (“ABS”). We currently classify and account for our investments in debt securities as trading. We previously had investments in debt securities that were classified as held to maturity as of May 31, 2019. During the fourth quarter of fiscal year 2020, in light of the extreme volatility and disruptions in the capital and credit markets in early March 2020 resulting from the COVID-19 crisis, we transferred the debt securities in our held-to-maturity investment portfolio to trading, as we revised our objective for the use of our held-to-maturity investment portfolio from previously serving as a supplemental source of liquidity to serving as a readily available source of liquidity. In conjunction with the transfer, recognized an unrealized gain of $1 million in earnings. We report debt securities classified as trading on our consolidated balance sheets at fair value with unrealized gains and losses recorded as a component of other non-interest income. Interest income is generally recognized over the contractual life of the securities based on the effective yield method. |
Loans to Members | Loans to Members Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are considered as held for investment. Loans held for investment are carried at the outstanding unpaid principal balance, net of unamortized loan origination costs. We classify and account for loans to members as held for investment. Deferred loan origination costs are amortized using the straight-line method, which approximates the effective interest method, into interest income over the life of the loan |
Non-performing Loans | Nonperforming Loans A loan is considered past due if a full payment of interest and principal is not received within 30 days of its due date. Loans are classified as nonperforming when the collection of interest and principal has become 90 days past due; court proceedings indicate that collection of interest and principal in accordance with the contractual terms is unlikely; or the full and timely collection of interest or principal becomes otherwise due. Once a loan is classified as nonperforming, we typically place the loan on nonaccrual status and reverse any accrued and unpaid interest recorded during the period in which the loan is classified as nonperforming. We generally apply all cash received during the nonaccrual period to the reduction of principal, thereby foregoing interest income recognition. The decision to return a loan to accrual status is determined on a case-by-case basis. We fully charge off or write down loans to the estimated net realizable value in the period that it becomes evident that collectability of the full contractual amount is highly unlikely; however, our efforts to recover all charged-off amounts may continue. The determination to write off all or a portion of a loan balance is made based on various factors on a case-by-case basis including, but not limited to, cash flow analysis and the fair value of collateral securing the borrower’s loans. |
Impaired Loans | Impaired Loans A loan is considered impaired when, based on current information and events, we determine that it is probable that we will be unable to collect all interest and principal amounts due as scheduled in accordance with the contractual terms of the loan agreement, other than an insignificant delay in payment or insignificant shortfall in payment amount. Factors considered in determining impairment may include, but are not limited to: • the review of the borrower’s audited financial statements and interim financial statements if available, • the borrower’s payment history, • communication with the borrower, • economic conditions in the borrower’s service territory, • pending legal action involving the borrower, • restructure agreements between us and the borrower, and • estimates of the value of the borrower’s assets that have been pledged as collateral to secure our loans. We recognize interest income on impaired loans on a case-by-case basis. An impaired loan to a borrower that is nonperforming will typically be placed on nonaccrual status and we will reverse all accrued and unpaid interest. We generally apply all cash received during the nonaccrual period to the reduction of principal, thereby foregoing interest income recognition. Interest income may be recognized on an accrual basis for restructured impaired loans where the borrower is performing and is expected to continue to perform based on agreed-upon terms. We may modify the terms of a loan to maximize the collection of amounts due when a borrower is experiencing financial difficulties. Concessionary modifications are classified as troubled debt restructurings (“TDRs”) unless the modification results in only an insignificant delay in payments to be received. All of our restructured loans are considered TDRs. |
Allowance for Credit Losses | Allowance for Loan Losses The allowance for loan losses represents management’s estimate of probable credit losses inherent in our loan portfolio, which consists of CFC, NCSC and RTFC loan portfolio segments. Our allowance for loan losses for our portfolio segments consists of a collective allowance for loans that are not individually impaired and a specific allowance for loans identified as individually impaired. We increase or decrease the allowance for loan losses by recording a provision or benefit for loan losses in the statement of operations. We record charge-offs against the allowance for loan losses when management determines that any portion of a loan is uncollectible. We add subsequent recoveries, if any, to the allowance for loan losses. Collective Allowance The collective allowance is established, by loan portfolio segment, using an internal model to estimate probable incurred losses as of each balance sheet date. We further stratify our loan portfolio segments and group loans into pools based on member borrower type—distribution, power supply, telecommunications, and statewide and associates—as we consider our members with the same operations to share similar risk characteristics. We delineate each of our loan pools by borrower risk rating and apply loss factors to the outstanding principal balance at the end of each reporting period to determine the collective allowance for loan losses. The loss factors consist of a probability of default, or default rate, and the loss given default, or loss severity or recovery, for each loan pool. We derive the total collective loss estimate by applying the default rate, based on a five-year loss emergence period, and recovery rate, based on our historical experience, to each loan pool. Following is additional information on the key inputs and assumptions used in determining our collective allowance for loan losses. • Internal Risk Ratings : As part of our credit risk-management process, we regularly evaluate each borrower and loan facility in our loan portfolio and assign an internal risk rating. Our borrower risk rating is intended to reflect probability of default. We engage an independent third party to perform an annual review of a sample of borrowers and loan facilities to corroborate our internally assigned risk ratings. The risk ratings are based on quantitative and qualitative factors, including the general financial condition of the borrower; our judgment of the quality of the borrower’s management; our judgment of the borrower’s competitive position within its service territory and industry; our estimate of the potential impact of proposed regulation and litigation; and other factors specific to individual borrowers or classes of borrowers. • Loss Emergence Period : The loss emergence period represents the average time between when a loss-triggering event, such as a successful new investment or expansion of services, a severe weather event or deterioration in operations, occurs and the problem loan is charged-off, restructured or otherwise resolved. Our loss emergence period of five years is based on CFC’s historical average loss emergence period. • Default Rates : Because we have a limited history of defaults to develop reasonable and supportable estimated probability of default rates for our existing loan portfolio, we utilize third-party default data for the utility sector as a proxy to estimate probability of default rates for our loan portfolio segments. The third-party default data provides historical expected default rates, based on credit ratings and remaining maturities of outstanding bonds, for the utility sector. We align our internal borrower risk ratings to the credit ratings provided in the utility default rate table and apply the cumulative default rates for our estimated average loss emergence period of five years to each of our loan pools. • Recovery Rates : We utilize our internal historical loss experience to estimate loss given default, or the recovery rate, for each of our loan portfolio segments, as we believe it provides a more reliable estimate than third-party loss severity data due to the organizational structure and operating environment of rural utility cooperatives, our lending practice of generally requiring a senior security position on the assets and revenues of borrowers for long-term loans, and the approach we take in working with borrowers that may be experiencing operational or financial issues. The historical recovery rates for each portfolio segment may be adjusted based on management’s consideration and assessment of current conditions and relevant factors, such as recent trends in credit performance, historical variability of recovery rates and additional analysis of long-term loss severity experience, changes in risk-management practices, current and past underwriting standards, specific industry issues and trends and general economic conditions. Specific Allowance The specific allowance for individually impaired loans that are not collateral dependent is calculated based on the difference between the recorded investment in the loan and the present value of the expected future cash flows, discounted at the loan’s effective interest rate. If the loan is collateral dependent, we measure the impairment based on the current fair value of the collateral less estimated selling costs. Loans are considered to be collateral dependent if repayment of the loan is expected to be provided solely by the underlying collateral and there are no other available and reliable sources of repayment. |
Unadvanced Loan Commitments | Unadvanced Loan Commitments Unadvanced commitments represent amounts for which we have approved and executed loan contracts, but the funds have not been advanced. The majority of the unadvanced commitments reported represent amounts that are subject to material adverse change clauses at the time of the loan advance. Prior to making an advance on these facilities, we would confirm there has been no material adverse change in the business or condition, financial or otherwise, of the borrower since the time the loan was approved and confirm the borrower is currently in compliance with loan terms and conditions. The remaining unadvanced commitments relate to line of credit loans that are not subject to a material adverse change clause at the time of each loan advance. As such, we would be required to advance amounts on these committed facilities as long as the borrower is in compliance with the terms and conditions of the loan commitment. Unadvanced loan commitments related to line of credit loans are typically for periods not to exceed five years and are generally revolving facilities used for working capital and backup liquidity purposes. Historically, we have experienced a very low utilization rate on line of credit loan facilities, whether or not there is a material adverse change clause. Since we generally do not charge a fee on the unadvanced portion of the majority of our loan facilities, our borrowers will typically request long-term facilities to fund construction work plans and other capital expenditures for periods of up to five years and draw down on the facility over that time. In addition, borrowers will typically request an amount in excess of their immediate estimated loan requirements to avoid the expense related to seeking additional loan funding for unexpected items. These factors contribute to our expectation that the majority of the unadvanced loan commitments will expire without being fully drawn upon and that the total unadvanced amount does not necessarily represent future cash funding requirements. Reserve for Unadvanced Loan Commitments We maintain a reserve for unadvanced loan commitments and committed lines of credit. This reserve is included as a component of other liabilities on our consolidated balance sheets, and changes in the reserve are included in other non-interest expense on our consolidated statements of operations. Our estimate of the reserve for potential losses on these commitments takes into consideration various factors, including the existence of a material adverse change clause, the historical utilization of the committed lines of credit, the probability of funding, historical loss experience on unadvanced loan commitments and other inputs along with management judgment consistent with the methodology used to determine our allowance for loan losses. |
Fixed Assets | Fixed Assets Fixed assets are recorded at cost less accumulated depreciation. We recognize depreciation expense for each category of our depreciable fixed assets on a straight-line basis over the estimated useful life, which ranges from three to 40 years. We recognized depreciation expense of $9 million , $9 million and $8 million in fiscal years 2020 , 2019 and 2018 , respectively. The following table displays the components of our fixed assets. Our headquarters facility in Loudoun County, Virginia, which is owned by CFC, is included as a component of building and building equipment. May 31, (Dollars in thousands) 2020 2019 Building and building equipment $ 50,087 $ 50,167 Furniture and fixtures 6,015 6,012 Computer software and hardware 49,944 71,915 Other 1,051 1,069 Depreciable fixed assets 107,097 129,163 Less: Accumulated depreciation (59,007 ) (53,695 ) Net depreciable fixed assets 48,090 75,468 Land 23,796 23,796 Software development in progress 17,251 21,363 Fixed assets, net $ 89,137 $ 120,627 |
Assets Held for Sale | In the fourth quarter of fiscal year 2020, management made a decision to abandon a project to develop an internal-use loan origination and servicing platform. The project was intended to update our loan platform to provide increased functionality and flexibility and enhance the operational efficiency of our lending, loan servicing and loan accounting processes. As a result of the decision to abandon the project, we wrote off the capitalized amounts related to this project, which were recorded as a component of computer software and hardware and software development in progress, and recognized a non-cash impairment charge of $31 million in the fourth quarter of fiscal year 2020. The impairment charge is reported as a component of other non-interest expense on our consolidated statements of operations. Assets Held for Sale An asset is classified as held for sale when (i) management commits to a plan to sell the asset or business; (ii) the asset or business is available for sale in its present condition; (iii) the asset or business is actively marketed for sale at a reasonable price; (iv) the sale is expected to be completed within one year; and (v) it is unlikely significant changes to the plan will be made or that the plan will be withdrawn. Long-lived assets classified as held for sale are initially measured at the lower of their carrying amount or fair value less cost to sell. If the carrying value exceeds the estimated fair value less cost to sell in the period the held for sale criteria are met, an impairment charge is recorded equal to the amount by which the carrying amount exceeds the fair value less cost to sell. Subsequent changes in the long-lived asset’s fair value less cost to sell is reported as an adjustment to the carrying amount to the extent that the adjusted carrying amount does not exceed the carrying amount of the long-lived asset at the time it was initially classified as held for sale. On March 14, 2018, CFC entered into a purchase and sale agreement (“the agreement”), which was subsequently amended, for the sale of a parcel of land, consisting of approximately 28 acres, located in Loudoun County, Virginia. We designated the property, which had a carrying value of $14 million , as held for sale and reclassified it from fixed assets, net to other assets on our consolidated balance sheet. On July 22, 2019, we closed on the sale of the land and received net proceeds of $22 million , resulting in a gain of $8 million on the sale of this property, which is reported in other non-interest expense on our consolidated statements of operations. |
Foreclosed Assets | Foreclosed Assets Foreclosed assets acquired through our lending activities in satisfaction of indebtedness may be held in operating entities created and controlled by CFC and presented separately in our consolidated balance sheets under foreclosed assets, net. These assets are initially recorded at estimated fair value as of the date of acquisition. Subsequent to acquisition, foreclosed assets not classified as held for sale are evaluated for impairment, and the results of operations and any impairment are reported on our consolidated statements of operations under results of operations of foreclosed assets. When foreclosed assets meet the accounting criteria to be classified as held for sale, they are recorded at the lower of cost or fair value less estimated cost to sell at the date of transfer, with the amount at the date of transfer representing the new cost basis. Subsequent changes are recognized in our consolidated statements of operations under results of operations of foreclosed assets. We also review foreclosed assets classified as held for sale each reporting period to determine whether the existing carrying amounts are fully recoverable in comparison to estimated fair values. We did no t carry any foreclosed assets on our consolidated balance sheet as of May 31, 2020 or May 31, 2019 |
Debt | Debt We report debt at cost net of unamortized issuance costs and discounts or premiums. Issuance costs, discounts and premiums are deferred and amortized into interest expense using the effective interest method or a method approximating the effective interest method over the legal maturity of each bond issue. Short-term borrowings consist of borrowings with an original contractual maturity of one year or less and do not include the current portion of long-term debt. Borrowings with an original contractual maturity of greater than one year are classified as long-term debt. |
Derivative Financial Instruments | Derivative Instruments We are an end user of derivative financial instruments and do not engage in derivative trading. We use derivatives, primarily interest rate swaps and Treasury rate locks, to manage interest rate risk. Derivatives may be privately negotiated contracts, which are often referred to as over-the-counter (“OTC”) derivatives, or they may be listed and traded on an exchange. We generally engage in OTC derivative transactions. In accordance with the accounting standards for derivatives and hedging activities, we record derivative instruments at fair value as either a derivative asset or derivative liability on our consolidated balance sheets. We report derivative asset and liability amounts on a gross basis based on individual contracts, which does not take into consideration the effects of master netting agreements or collateral netting. Derivatives in a gain position are reported as derivative assets on our consolidated balance sheets, while derivatives in a loss position are reported as derivative liabilities. Accrued interest related to derivatives is reported on our consolidated balance sheets as a component of either accrued interest receivable or accrued interest payable. If we do not elect hedge accounting treatment, changes in the fair value of derivative instruments, which consist of net accrued periodic derivative cash settlements expense and derivative forward value amounts, are recognized in our consolidated statements of operations under derivative gains (losses). If we elect hedge accounting treatment for derivatives, we formally document, designate and assess the effectiveness of the hedge relationship. Changes in the fair value of derivatives designated as qualifying fair value hedges are recorded in earnings together with offsetting changes in the fair value of the hedged item and any related ineffectiveness. Changes in the fair value of derivatives designated as qualifying cash flow hedges are recorded as a component of other comprehensive income (“OCI”), to the extent that the hedge relationships are effective, and reclassified from accumulated other comprehensive income (“AOCI”) to earnings using the effective interest method over the term of the forecasted transaction. Any ineffectiveness in the hedging relationship is recognized as a component of derivative gains (losses) in our consolidated statement of operations. We generally do not designate interest rate swaps, which represent the substantial majority of our derivatives, for hedge accounting. Accordingly, changes in the fair value of interest rate swaps are reported in our consolidated statements of operations under derivative gains (losses). Net periodic cash settlements expense related to interest rate swaps are classified as an operating activity in our consolidated statements of cash flows. We typically designate Treasury rate locks as cash flow hedges of forecasted debt issuances or repricings. Changes in the fair value of treasury locks designated as cash flow hedges are recorded as a component of OCI and reclassified from AOCI into interest expense when the forecasted transaction occurs using the effective interest method. Any ineffectiveness is recognized as a component of derivative gains (losses) in our consolidated statements of operations. |
Guarantee Liability | Guarantee Liability We maintain a guarantee liability that represents our contingent and noncontingent exposure related to guarantees and standby liquidity obligations associated with our members’ debt. The guarantee liability is included in the other liabilities line item on the consolidated balance sheet, and the provision for guarantee liability is reported in non-interest expense as a separate line item on the consolidated statement of operations. The contingent portion of the guarantee liability represents management’s estimate of our exposure to losses within the guarantee portfolio. The methodology used to estimate the contingent guarantee liability is consistent with the methodology used to determine the allowance for loan losses. We have recorded a noncontingent guarantee liability for all new or modified guarantees since January 1, 2003. Our noncontingent guarantee liability represents our obligation to stand ready to perform over the term of our guarantees and liquidity obligations that we have entered into or modified since January 1, 2003. Our noncontingent obligation is estimated based on guarantee and liquidity fees charged for guarantees issued, which represents management’s estimate of the fair value of our obligation to stand ready to perform. The fees are deferred and amortized using the straight-line method into interest income over the term of the guarantee. |
Fair Value of Financial Instruments | Fair Value Valuation Processes We present certain financial instruments at fair value, including equity and debt securities, and derivatives. Fair value is defined as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date (also referred to as an exit price). We have various processes and controls in place to ensure that fair value is reasonably estimated. We consider observable prices in the principal market in our valuations where possible. Fair value estimates were developed at the reporting date and may not necessarily be indicative of amounts that could ultimately be realized in a market transaction at a future date. With the exception of redeeming debt under early redemption provisions, terminating derivative instruments under early-termination provisions and allowing borrowers to prepay their loans, we held and intend to hold all financial instruments to maturity excluding common stock and preferred stock investments that have no stated maturity and our trading debt securities. Fair Value Hierarchy The fair value accounting guidance provides a three-level fair value hierarchy for classifying financial instruments. This hierarchy is based on the markets in which the assets or liabilities trade and whether the inputs to the valuation techniques used to measure fair value are observable or unobservable. Fair value measurement of a financial asset or liability is assigned a level based on the lowest level of any input that is significant to the fair value measurement in its entirety. The three levels of the fair value hierarchy are summarized below: • Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities • Level 2: Observable market-based inputs, other than quoted prices in active markets for identical assets or liabilities • Level 3: Unobservable inputs The degree of management judgment involved in determining the fair value of a financial instrument is dependent upon the availability of quoted prices in active markets or observable market parameters. When quoted prices and observable data in active markets are not fully available, management’s judgment is necessary to estimate fair value. Changes in market conditions, such as reduced liquidity in the capital markets or changes in secondary market activities, may reduce the availability and reliability of quoted prices or observable data used to determine fair value. |
Membership Fees | Membership Fees Members are charged a one-time membership fee based on member class. CFC distribution system members, power supply system members and national associations of cooperatives pay a $1,000 membership fee. CFC service organization members pay a $200 membership fee and CFC associates pay a $1,000 fee. RTFC voting members pay a $1,000 membership fee and RTFC associates pay a $100 fee. NCSC members pay a $100 membership fee. Membership fees are accounted for as members’ equity. |
Financial Instruments with Off-Balance Sheet Risk | Financial Instruments with Off-Balance Sheet Risk In the normal course of business, we are a party to financial instruments with off-balance sheet risk to meet the financing needs of our member borrowers. These financial instruments include committed lines of credit, standby letters of credit and guarantees of members’ obligations. |
Interest Income | Interest Income Interest income on loans and investments is recognized using the effective interest method. The following table presents interest income, by interest-earning asset category, for fiscal years 2020 , 2019 and 2018 . Year Ended May 31, (Dollars in thousands) 2020 2019 2018 Interest income by interest-earning asset type: Long-term fixed-rate loans (1) $ 1,043,918 $ 1,012,277 $ 1,000,492 Long-term variable-rate loans 31,293 41,219 27,152 Line of credit loans 55,140 57,847 38,195 TDR loans (2) 836 846 889 Other income, net (3) (1,304 ) (1,128 ) (1,185 ) Total loans 1,129,883 1,111,061 1,065,543 Cash, time deposits and investment securities 21,403 24,609 11,814 Total interest income $ 1,151,286 $ 1,135,670 $ 1,077,357 ____________________________ (1) Includes loan conversion fees, which are generally deferred and recognized as interest income using the effective interest method. (2) Troubled debt restructured (“TDR”) loans. (3) Consists of late payment fees, commitment fees and net amortization of deferred loan fees and loan origination costs. Deferred income of $59 million and $58 million as of May 31, 2020 and 2019 , respectively, consists primarily of deferred loan conversion fees totaling $53 million and $52 million , respectively. Deferred loan conversion fees are recognized in interest income using the effective interest method. |
Interest Expense | Interest Expense The following table presents interest expense, by debt product type, for fiscal years 2020 , 2019 and 2018 . Year Ended May 31, (Dollars in thousands) 2020 2019 2018 Interest expense by debt product type: (1)(2) Short-term borrowings $ 77,995 $ 92,854 $ 50,616 Medium-term notes 125,954 133,797 111,814 Collateral trust bonds 257,396 273,413 336,079 Guaranteed Underwriter Program notes payable 162,929 147,895 140,551 Farmer Mac notes payable 87,617 90,942 56,004 Other notes payable 671 1,237 1,509 Subordinated deferrable debt 51,527 38,628 37,661 Subordinated certificates 57,000 57,443 58,501 Total interest expense $ 821,089 $ 836,209 $ 792,735 ____________________________ (1) Includes amortization of debt discounts and debt issuance costs, which are generally deferred and recognized as interest expense using the effective interest method. Issuance costs related to dealer commercial paper, however, are recognized as interest expense immediately as incurred. (2) Includes fees related to funding arrangements, such as up-front fees paid to banks participating in our committed bank revolving line of credit agreements. Depending on the nature of the fee, amounts may be deferred and recognized as interest expense ratably over the term of the arrangement or recognized immediately as incurred. |
Early Extinguishment of Debt | Early Extinguishment of Debt We redeem outstanding debt early from time to time to manage liquidity and interest rate risk. When we redeem outstanding debt early, we recognize a gain or loss related to the difference between the amount paid to redeem the debt and the net book value of the extinguished debt as a component of non-interest expense in the gain (loss) on early extinguishment of debt line item. |
Income Taxes | Income Taxes While CFC is exempt under Section 501(c)(4) of the Internal Revenue Code, it is subject to tax on unrelated business taxable income. NCSC is a taxable cooperative that pays income tax on the full amount of its reportable taxable income and allowable deductions. RTFC is a taxable cooperative under Subchapter T of the Internal Revenue Code and is not subject to income taxes on income from patronage sources that is allocated to its borrowers, as long as the allocation is properly noticed and at least 20% of the amount allocated is retired in cash prior to filing the applicable tax return. The income tax benefit (expense) recorded in the consolidated statement of operations represents the income tax benefit (expense) at the applicable combined federal and state income tax rates resulting in a statutory tax rate. The federal statutory tax rate for both NCSC and RTFC was 21% for fiscal year 2020 . The federal statutory tax rate for both NCSC and RTFC was 21% for fiscal year 2019 and the federal statutory tax rate for NCSC and RTFC was 29% and 12% , respectively, for fiscal year 2018 . Substantially all of the income tax expense recorded in our consolidated statements of operations relates to NCSC. NCSC had a deferred tax asset of $3 million and $2 million as of May 31, 2020 and 2019 , respectively, primarily arising from differences in the accounting and tax treatment for derivatives. We believe that it is more likely than not that the deferred tax assets will be realized through taxable earnings. |
New Accounting Pronouncements | Accounting Standards Adopted in Fiscal Year 2020 Derivatives and Hedging—Targeted Improvements to Accounting for Hedging Activities In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging—Targeted Improvements to Accounting for Hedging Activities (Topic 815) , which expands the types of risk management strategies that qualify for hedge accounting treatment to more closely align the results of hedge accounting with the economics of certain risk-management activities and simplifies certain hedge documentation and assessment requirements. It also eliminates the concept of separately recording hedge ineffectiveness and expands disclosure requirements. The guidance is effective for public entities for fiscal years beginning after December 15, 2018, including interim periods within those years. Early adoption is permitted in any interim period or fiscal year before the effective date. We adopted this guidance on June 1, 2019. Hedge accounting is elective, and we currently apply hedge accounting on a limited basis, specifically when we enter into Treasury rate lock agreements. The adoption of this guidance did not have an impact on our consolidated financial statements or cash flows. If we continue to elect not to apply hedge accounting to our interest rate swaps, the guidance will not have an impact on our consolidated financial statements or liquidity. Receivables—Nonrefundable Fees and Other Costs In March 2017, the FASB issued ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) , which shortens the amortization period for the premium on certain callable debt securities to the earliest call date rather the maturity date. The guidance is applicable to any individual debt security, purchased at a premium, with an explicit and noncontingent call feature with a fixed price on a preset date. The guidance does not impact the accounting for purchased callable debt securities held at a discount. The guidance is effective for public entities in fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We adopted this guidance on June 1, 2019. The adoption of this guidance did not have a material impact on our consolidated financial statements or liquidity. Leases In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which provides new guidance that is intended to improve financial reporting about leasing transactions. The new guidance requires the recognition of a right-of-use asset and lease liability on the consolidated balance sheet by lessees for those leases classified as operating leases under previous guidance. It also requires new disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. We adopted this guidance on June 1, 2019. The adoption of this guidance did not have a material impact on our consolidated financial statements or liquidity. Accounting Standards Adopted Subsequent to Fiscal Year 2020 Fair Value Measurement—Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement—Changes to the Disclosure Requirements for Fair Value Measurement (Topic 820), which eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. The guidance is effective for public entities for fiscal years beginning after December 15, 2019, including interim periods within those years. Early adoption is permitted in any interim period or fiscal year before the effective date. We adopted this guidance on June 1, 2020. The adoption of this guidance did not have a material impact on our consolidated financial statements or liquidity. Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments (Topic 326), which replaces the existing incurred credit loss model and establishes a single credit loss framework based on a current expected credit loss (“CECL”) model for financial assets carried at amortized cost, including loans and held-to-maturity debt securities. CECL requires an entity to estimate credit losses expected over the life of the credit exposure upon initial recognition of that exposure when the financial asset is originated or acquired, which will generally result in earlier recognition of credit losses. The guidance also expands credit quality disclosures and amends the other-than-temporary model for available-for-sale debt securities by requiring the use of an allowance, rather than directly reducing the carrying value of the security. The CECL model is applicable to our loans held-for-investment, unadvanced loan commitments and financial guarantees. Our investment securities are not within the scope of the CECL model because they are classified as trading. We adopted CECL on June 1, 2020, using a modified retrospective approach. We leveraged our existing probability of default/loss given default model for estimating incurred credit losses and recalibrated this model to serve as the framework for our approach in estimating life-time credit losses for our loan portfolio under CECL. Due to the disruption, rapidly changing conditions and uncertainty caused by the ongoing COVID-19 pandemic, management is continuing to review, assess and refine considerations and judgments related to our qualitative framework under CECL prior to finalizing our estimate of expected credit losses. However, we currently do not believe that the impact at adoption of CECL will have a material impact on our consolidated financial statements. We expect the ultimate impact from our June 1, 2020 adoption of CECL, which we are required to record as a cumulative-effect adjustment to retained earnings, will result in an immaterial decrease in retained earnings and a corresponding increase in our allowance for loan losses. Subsequent to June 1, 2020, expected credit losses for newly recognized loans held for investment, unadvanced loan commitments and financial guarantees, as well as changes in our estimate of expected credit losses on existing financial instruments subject to CECL, will be recognized in earnings. We will be subject to the expanded credit quality disclosure requirements under CECL beginning with the filing of our fiscal year 2021 first quarter Form 10-Q report for the quarterly period ended August 31, 2020. |
Fair Value Measurement | Recurring Fair Value Measurements The following table presents the carrying value and fair value of financial instruments reported in our consolidated financial statements at fair value on a recurring basis as of May 31, 2020 and 2019 and the classification of the valuation technique within the fair value hierarchy. May 31, 2020 2019 (Dollars in thousands) Level 1 Level 2 Total Level 1 Level 2 Total Equity securities $ 60,735 $ — $ 60,735 $ 87,533 $ — $ 87,533 Debt securities trading — 309,400 309,400 — — — Deferred compensation investments 5,496 — 5,496 4,984 — 4,984 Derivative assets — 173,195 173,195 — 41,179 41,179 Derivative liabilities — 1,258,459 1,258,459 — 391,724 391,724 Below is a description of the valuation techniques we use to estimate fair value of our financial assets and liabilities recorded at fair value on a recurring basis, the significant inputs used in those techniques, if applicable, and the classification within the fair value hierarchy. Equity Securities Our investments in equity securities consist of investments in Farmer Mac Class A common stock and Series A, Series B and Series C preferred stock. These securities are reported at fair value in our consolidated balance sheets. We determine the fair value based on quoted prices on the stock exchange where the stock is traded. That stock exchange with respect to Farmer Mac Class A common stock is an active market based on the volume of shares transacted. Fair values for these securities are classified within Level 1 of the fair value hierarchy. Debt Securities Trading As discussed above in “Note 1—Summary of Significant Accounting Policies” our debt securities consist of investments in certificates of deposit with maturities greater than 90 days, corporate debt securities, municipality debt securities, commercial MBS and other ABS and were classified as trading as of May 31, 2020 . We previously classified our investments in debt securities as held to maturity as of May 31, 2019. During the fourth quarter of fiscal year 2020, in light of the extreme volatility and disruptions in the capital and credit markets in early March 2020 resulting from the COVID-19 pandemic, we transferred the debt securities in our held-to-maturity investment portfolio to trading, as we revised our objective for the use of our held-to-maturity investment portfolio from previously serving as a supplemental source of liquidity to serving as a readily available source of liquidity. Management estimates the fair value of our debt securities utilizing the assistance of third-party pricing services. Methodologies employed, controls relied upon and inputs used by third-party pricing vendors are subject to management review when such services are provided. This review may consist of, in part, obtaining and evaluating control reports issued and pricing methodology materials distributed. We review the pricing methodologies provided by the vendors in order to determine if observable market information is being used to determine the fair value versus unobservable inputs. Investment securities traded in secondary markets are typically valued using unadjusted vendor prices. These investment securities, which include those measured using unadjusted vendor prices, are generally classified as Level 2 because the valuation typically involves using quoted market prices for similar securities, pricing models, discounted cash flow analyses using significant observable market where available or a combination of multiple valuation techniques for which all significant assumptions are observable in the market. Deferred Compensation Investments CFC offers a nonqualified 457(b) deferred compensation plan to highly compensated employees and board members. Such amounts deferred by employees are invested by the company. The deferred compensation investments are presented as other assets in the consolidated balance sheets in the other assets category at fair value. We calculate fair value based on the daily published and quoted net asset value, and these investments are classified within Level 1 of the fair value hierarchy. Derivative Instruments Our derivatives primarily consist of over-the-counter interest rate swaps. All of our swap agreements are subject to master netting agreements. There is not an active secondary market for the types of interest rate swaps we use. We determine the fair value of our derivatives using models that incorporate observable market inputs, such as spot LIBOR rates, Eurodollar futures contracts and market swap rates. These inputs can vary depending on the type of derivative and nature of the underlying rate, price or index upon which the derivative’s value is based. The impact of counterparty nonperformance risk is considered when measuring the fair value of derivative assets. Internal pricing is compared against additional pricing sources, such as external valuation agents and other sources. Pricing variances among different pricing sources are analyzed and validated. The technique for determining the fair value for our interest rate swaps is classified as Level 2. Transfers Between Levels We monitor the availability of observable market data to assess the appropriate classification of financial instruments within the fair value hierarchy and transfer between Level 1, Level 2 and Level 3 accordingly. Observable market data includes, but is not limited to, quoted prices and market transactions. Changes in economic conditions or market liquidity generally will drive changes in availability of observable market data. Changes in availability of observable market data, which also may result in changes in the valuation technique used, are generally the cause of transfers between levels. We did not have any transfers between levels for financial instruments measured at fair value on a recurring basis for the fiscal years ended May 31, 2020 and 2019 . Nonrecurring Fair Value Measurements We may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis on our consolidated balance sheets. These assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, such as in the application of lower of cost or fair value accounting or when we evaluate for impairment. Assets measured at fair value on a nonrecurring basis and still held during fiscal years ended May 31, 2020 and 2019 consisted of certain impaired loans. Fair value measurement adjustments for individually impaired loans are recorded in the provision for loan losses on our consolidated statements of operations. The fair value of these assets is determined based on the use of significant unobservable inputs, which are considered Level 3 in the fair value hierarchy. We did not have any nonrecurring fair value measurement adjustments recorded in earnings attributable to these assets during fiscal years 2020 , 2019 or 2018 . Significant Unobservable Level 3 Inputs Impaired Loans The fair value of impaired loans is typically measured based on the present value of expected future cash flows. Our estimate of expected future cash flows incorporates, among other items, assumptions regarding default rates, loss severities, the amounts and timing of prepayments, as well as the characteristics of the loan. If we expect repayment to be provided solely by the continued operation or sale of the underlying collateral, the fair value of the collateral less estimated costs to sell is used as the basis for measuring fair value. We employ various approaches and techniques to determine the fair value of collateral-dependent loans, including developing market multiples and obtaining valuations from third-party specialists. The significant unobservable inputs used in measuring the fair value of collateral-dependent loans include estimated cash flows before interest, taxes, depreciation and amortization and market multiples for comparable companies. Our Credit Risk Management group reviews the unobservable inputs to assess the reasonableness of the assumptions used and the accuracy of the work performed. We did not have any impaired collateral-dependent loans as of May 31, 2020 or May 31, 2019 . |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
May 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of fixed assets | The following table displays the components of our fixed assets. Our headquarters facility in Loudoun County, Virginia, which is owned by CFC, is included as a component of building and building equipment. May 31, (Dollars in thousands) 2020 2019 Building and building equipment $ 50,087 $ 50,167 Furniture and fixtures 6,015 6,012 Computer software and hardware 49,944 71,915 Other 1,051 1,069 Depreciable fixed assets 107,097 129,163 Less: Accumulated depreciation (59,007 ) (53,695 ) Net depreciable fixed assets 48,090 75,468 Land 23,796 23,796 Software development in progress 17,251 21,363 Fixed assets, net $ 89,137 $ 120,627 |
Schedule of components of interest income | Interest income on loans and investments is recognized using the effective interest method. The following table presents interest income, by interest-earning asset category, for fiscal years 2020 , 2019 and 2018 . Year Ended May 31, (Dollars in thousands) 2020 2019 2018 Interest income by interest-earning asset type: Long-term fixed-rate loans (1) $ 1,043,918 $ 1,012,277 $ 1,000,492 Long-term variable-rate loans 31,293 41,219 27,152 Line of credit loans 55,140 57,847 38,195 TDR loans (2) 836 846 889 Other income, net (3) (1,304 ) (1,128 ) (1,185 ) Total loans 1,129,883 1,111,061 1,065,543 Cash, time deposits and investment securities 21,403 24,609 11,814 Total interest income $ 1,151,286 $ 1,135,670 $ 1,077,357 ____________________________ (1) Includes loan conversion fees, which are generally deferred and recognized as interest income using the effective interest method. (2) Troubled debt restructured (“TDR”) loans. (3) Consists of late payment fees, commitment fees and net amortization of deferred loan fees and loan origination costs. |
Schedule of components of interest expense | The following table presents interest expense, by debt product type, for fiscal years 2020 , 2019 and 2018 . Year Ended May 31, (Dollars in thousands) 2020 2019 2018 Interest expense by debt product type: (1)(2) Short-term borrowings $ 77,995 $ 92,854 $ 50,616 Medium-term notes 125,954 133,797 111,814 Collateral trust bonds 257,396 273,413 336,079 Guaranteed Underwriter Program notes payable 162,929 147,895 140,551 Farmer Mac notes payable 87,617 90,942 56,004 Other notes payable 671 1,237 1,509 Subordinated deferrable debt 51,527 38,628 37,661 Subordinated certificates 57,000 57,443 58,501 Total interest expense $ 821,089 $ 836,209 $ 792,735 ____________________________ (1) Includes amortization of debt discounts and debt issuance costs, which are generally deferred and recognized as interest expense using the effective interest method. Issuance costs related to dealer commercial paper, however, are recognized as interest expense immediately as incurred. (2) Includes fees related to funding arrangements, such as up-front fees paid to banks participating in our committed bank revolving line of credit agreements. Depending on the nature of the fee, amounts may be deferred and recognized as interest expense ratably over the term of the arrangement or recognized immediately as incurred. |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 12 Months Ended |
May 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities | The following table provides information on incremental consolidated assets and liabilities of VIEs included in CFC’s consolidated financial statements, after intercompany eliminations, as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Total loans outstanding $ 1,083,197 $ 1,087,988 Other assets 11,352 10,963 Total assets $ 1,094,549 $ 1,098,951 Long-term debt $ — $ 6,000 Other liabilities 38,803 33,385 Total liabilities $ 38,803 $ 39,385 |
Schedule of Variable Interest Entities, Credit Commitments | The following table provides information on CFC’s credit commitments to NCSC and RTFC, and its potential exposure to loss as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 CFC credit commitments $ 5,500,000 $ 5,500,000 Outstanding commitments: Borrowings payable to CFC (1) 1,062,103 1,059,629 Credit enhancements: CFC third-party guarantees 9,999 10,091 Other credit enhancements 11,755 14,251 Total credit enhancements (2) 21,754 24,342 Total outstanding commitments 1,083,857 1,083,971 CFC available credit commitments $ 4,416,143 $ 4,416,029 ____________________________ (1) Borrowings payable to CFC are eliminated in consolidation. (2) Excludes interest due on these instruments. |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
May 31, 2020 | |
Debt and Equity Securities, FV-NI [Line Items] | |
Debt Securities, Trading, and Equity Securities, FV-NI [Table Text Block] | Debt Securities Trading, at Fair Value The following table presents the fair value of our debt securities classified as trading by major security type as of May 31, 2020 . (Dollars in thousands) May 31, 2020 Debt securities trading, at fair value: Certificates of deposit $ 5,585 Corporate debt securities 253,153 Commercial MBS: Agency 7,655 Non-agency 3,207 Total commercial MBS 10,862 U.S. state and municipality debt securities 8,296 Other ABS (1) 31,504 Total debt securities trading, at fair value $ 309,400 |
Schedule of investments in equity securities | The following table presents the fair value of our equity securities, all of which had readily determinable fair values, as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Equity securities at fair value: Farmer Mac—Series A, B and C non-cumulative preferred stock $ 55,640 $ 82,445 Farmer Mac—class A common stock 5,095 5,088 Total equity securities at fair value $ 60,735 $ 87,533 |
Debt Securities, Held-to-maturity | The following table presents the fair value of our debt securities classified as trading by major security type as of May 31, 2020 . (Dollars in thousands) May 31, 2020 Debt securities trading, at fair value: Certificates of deposit $ 5,585 Corporate debt securities 253,153 Commercial MBS: Agency 7,655 Non-agency 3,207 Total commercial MBS 10,862 U.S. state and municipality debt securities 8,296 Other ABS (1) 31,504 Total debt securities trading, at fair value $ 309,400 ____________________________ (1) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. Realized and Unrealized Gains and Losses During the year ended May 31, 2020 , we sold debt investment securities totaling $239 million . The following table presents the gross realized and unrealized gains and losses on our debt securities classified as trading as of May 31, 2020 . These realized and unrealized amounts are reported as a component of non-interest income on our consolidated statements of operations. For additional information on our investments in debt securities, see “Note 1—Summary of Significant Accounting Policies.” (Dollars in thousands) May 31, 2020 Debt securities gains (losses): Realized gains $ 3,686 Unrealized gains 7,543 Total gains on debt securities trading $ 11,229 Debt Securities Held-to-Maturity, at Amortized Cost Amortized Cost and Fair Value of Debt Securities The following table presents the amortized cost and fair value of our debt securities classified as held to maturity and the corresponding gross unrealized gains and losses, by classification category and major security type, as of May 31, 2019 . May 31, 2019 (Dollars in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Debt securities held-to-maturity: Certificates of deposit $ 1,000 $ — $ — $ 1,000 Commercial paper 12,395 — — 12,395 U.S. agency debt securities 3,207 108 — 3,315 Corporate debt securities 478,578 4,989 (912 ) 482,655 Commercial MBS: Agency 7,255 291 — 7,546 Non-agency 3,453 — (7 ) 3,446 Total commercial MBS 10,708 291 (7 ) 10,992 U.S. state and municipality debt securities 9,608 352 — 9,960 Foreign government debt securities 1,254 42 — 1,296 Other ABS (1) 48,694 290 (48 ) 48,936 Total debt securities held-to-maturity $ 565,444 $ 6,072 $ (967 ) $ 570,549 ____________________________ (1) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. |
Gain (Loss) on Securities [Table Text Block] | The following table presents the gross realized and unrealized gains and losses on our debt securities classified as trading as of May 31, 2020 . These realized and unrealized amounts are reported as a component of non-interest income on our consolidated statements of operations. For additional information on our investments in debt securities, see “Note 1—Summary of Significant Accounting Policies.” (Dollars in thousands) May 31, 2020 Debt securities gains (losses): Realized gains $ 3,686 Unrealized gains 7,543 Total gains on debt securities trading $ 11,229 |
Schedule of Unrealized Loss on Investments | The securities are segregated between investments that have been in a continuous unrealized loss position for less than 12 months and 12 months or more based on the point in time that the fair value declined below the amortized cost basis. May 31, 2019 Unrealized Loss Position Less than 12 Months Unrealized Loss Position 12 Months or Longer Total (Dollars in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Debt securities held-to-maturity: Commercial paper (1) $ 2,688 $ — $ — $ — $ 2,688 $ — Corporate debt securities 45,999 (198 ) 164,086 (714 ) 210,085 (912 ) Commercial MBS, non-agency 1,996 (4 ) 1,448 (3 ) 3,444 (7 ) Other ABS (2) 1,982 (4 ) 13,840 (44 ) 15,822 (48 ) Total debt securities held-to-maturity $ 52,665 $ (206 ) $ 179,374 $ (761 ) $ 232,039 $ (967 ) ____________________________ (1) Unrealized losses on the commercial paper investments are less than $1,000 . (2) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. |
Investments Classified by Contractual Maturity Date | The following table presents, by major security type, the remaining contractual maturity based on amortized cost and fair value of our held-to-maturity investment securities as of May 31, 2019 . Because borrowers may have the right to call or prepay certain obligations, the expected maturities of our investments may differ from the scheduled contractual maturities presented below. May 31, 2019 (Dollars in thousands) Due in 1 Year or Less Due > 1 Year through 5 Years Due > 5 Years through 10 Years Due >10 Years Total Amortized cost: Certificates of deposit $ — $ 1,000 $ — $ — $ 1,000 Commercial paper 12,395 — — — 12,395 U.S. agency debt securities — 2,678 529 — 3,207 Corporate debt securities 51,923 414,788 11,867 — 478,578 Commercial MBS: Agency — 310 6,945 — 7,255 Non-Agency — — — 3,453 3,453 Total Commercial MBS — 310 6,945 3,453 10,708 U.S. state and municipality debt securities — 9,608 — — 9,608 Foreign government debt securities — 1,254 — — 1,254 Other ABS (1) 510 45,730 2,454 — 48,694 Total $ 64,828 $ 475,368 $ 21,795 $ 3,453 $ 565,444 Fair value: Certificates of deposit $ — $ 1,000 $ — $ — $ 1,000 Commercial paper 12,395 — — — 12,395 U.S. agency debt securities — 2,769 546 — 3,315 Corporate debt securities 51,818 418,606 12,231 — 482,655 Commercial MBS: Agency — 317 7,229 — 7,546 Non-Agency — — — 3,446 3,446 Total Commercial MBS — 317 7,229 3,446 10,992 U.S. state and municipality debt securities — 9,960 — — 9,960 Foreign government debt securities — 1,296 — — 1,296 Other ABS (1) 509 45,916 2,511 — 48,936 Total $ 64,722 $ 479,864 $ 22,517 $ 3,446 $ 570,549 Weighted average coupon (2) 2.08 % 3.10 % 3.07 % 3.26 % 2.98 % ____________________________ (1) Consists primarily of securities backed by auto lease loans, equipment-backed loans, auto loans and credit card loans. (2) Calculated based on the weighted-average coupon rate, which excludes the impact of amortization of premium and accretion of discount. |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
May 31, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Summary of loans outstanding to members and unadvanced commitments by loan type and by member class | The following table presents the outstanding principal balance of loans to members, including deferred loan origination costs, and unadvanced loan commitments by loan type and member class, as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Loans Outstanding Unadvanced Commitments (1) Loans Outstanding Unadvanced Commitments (1) Loan type: Long-term loans: Fixed rate $ 24,472,003 $ — $ 23,094,253 $ — Variable rate 655,704 5,458,676 1,066,880 5,448,636 Total long-term loans 25,127,707 5,458,676 24,161,133 5,448,636 Lines of credit 1,563,147 7,929,950 1,744,531 7,788,922 Total loans outstanding 26,690,854 13,388,626 25,905,664 13,237,558 Deferred loan origination costs 11,526 — 11,240 — Loans to members $ 26,702,380 $ 13,388,626 $ 25,916,904 $ 13,237,558 Member class: CFC: Distribution $ 20,769,653 $ 8,992,457 $ 20,155,266 $ 8,773,018 Power supply 4,731,506 3,409,227 4,578,841 3,466,680 Statewide and associate 106,498 153,626 83,569 165,687 Total CFC 25,607,657 12,555,310 24,817,676 12,405,385 NCSC 697,862 551,674 742,888 552,840 RTFC 385,335 281,642 345,100 279,333 Total loans outstanding 26,690,854 13,388,626 25,905,664 13,237,558 Deferred loan origination costs 11,526 — 11,240 — Loans to members $ 26,702,380 $ 13,388,626 $ 25,916,904 $ 13,237,558 ____________________________ (1) The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Schedule of Available Balance and Maturities of Lines of Credit [Table Text Block] | The following table summarizes, by loan type, the available balance under unadvanced loan commitments as of May 31, 2020 and related maturities by fiscal year for each of the next five fiscal years and thereafter. Available Notional Maturities of Unadvanced Loan Commitments (Dollars in thousands) 2021 2022 2023 2024 2025 Thereafter Line of credit loans $ 7,929,950 $ 4,050,588 $ 613,528 $ 1,223,510 $ 961,034 $ 1,032,749 $ 48,541 Long-term loans 5,458,676 497,104 1,364,755 873,822 1,674,029 1,044,671 4,295 Total $ 13,388,626 $ 4,547,692 $ 1,978,283 $ 2,097,332 $ 2,635,063 $ 2,077,420 $ 52,836 |
Summary of available balance under committed lines of credit and the related maturities by fiscal year | The following table summarizes the available balance under unconditional committed lines of credit and the related maturities by fiscal year and thereafter, as of May 31, 2020 . Available Balance Notional Maturities of Unconditional Committed Lines of Credit (Dollars in thousands) 2021 2022 2023 2024 2025 Committed lines of credit $2,857,029 $115,815 $194,105 $970,366 $698,396 $878,347 |
Summary of loans outstanding as collateral pledged to secure the entity's collateral trust bonds, Clean Renewable Energy Bonds and notes payable to the Federal Agricultural Mortgage Corporation and the amount of the corresponding debt outstanding | The following table summarizes our loans outstanding as collateral pledged to secure our collateral trust bonds, Clean Renewable Energy Bonds, notes payable to Farmer Mac and notes payable under USDA’s Guaranteed Underwriter Program (“Guaranteed Underwriter Program”) and the amount of the corresponding debt outstanding as of May 31, 2020 and 2019 . See “Note 6—Short-Term Borrowings” and “Note 7—Long-Term Debt” for information on our borrowings. May 31, (Dollars in thousands) 2020 2019 Collateral trust bonds: 2007 indenture: Distribution system mortgage notes $ 8,244,202 $ 8,775,231 RUS-guaranteed loans qualifying as permitted investments 128,361 134,678 Total pledged collateral $ 8,372,563 $ 8,909,909 Collateral trust bonds outstanding 7,422,711 7,622,711 1994 indenture: Distribution system mortgage notes $ 39,785 $ 47,331 Collateral trust bonds outstanding 35,000 40,000 Farmer Mac: Distribution and power supply system mortgage notes $ 3,687,418 $ 3,751,798 Notes payable outstanding 3,059,637 3,054,914 Clean Renewable Energy Bonds Series 2009A: Distribution and power supply system mortgage notes $ 7,269 $ 10,349 Cash 395 415 Total pledged collateral $ 7,664 $ 10,764 Notes payable outstanding 6,068 9,225 Federal Financing Bank: Distribution and power supply system mortgage notes $ 7,535,931 $ 6,157,218 Notes payable outstanding 6,261,312 5,410,507 |
Schedule of loan portfolio by risk rating category and member class based on available data | May 31, 2020 and 2019 . If a parent company provides a guarantee of full repayment of loans of a subsidiary borrower, we group the outstanding loans in the borrower risk-rating category of the guarantor parent company instead of the risk-rating category of the subsidiary borrower for purposes of estimating the allowance for loan losses. The borrower risk ratings for loans outstanding presented in the tables below are based on this risk-rating grouping. May 31, 2020 (Dollars in thousands) Pass Special Mention Substandard Doubtful Total CFC: Distribution $ 20,643,737 $ 7,743 $ 118,173 $ — $ 20,769,653 Power supply 4,516,595 — 47,203 167,708 4,731,506 Statewide and associate 90,274 16,224 — — 106,498 CFC total 25,250,606 23,967 165,376 167,708 25,607,657 NCSC 697,862 — — — 697,862 RTFC 371,507 8,736 5,092 — 385,335 Total loans outstanding $ 26,319,975 $ 32,703 $ 170,468 $ 167,708 $ 26,690,854 May 31, 2019 (Dollars in thousands) Pass Special Mention Substandard Doubtful Total CFC: Distribution $ 20,022,193 $ 10,375 $ 122,698 $ — $ 20,155,266 Power supply 4,530,708 — 48,133 — 4,578,841 Statewide and associate 68,569 15,000 — — 83,569 CFC total 24,621,470 25,375 170,831 — 24,817,676 NCSC 742,888 — — — 742,888 RTFC 339,508 — 5,592 — 345,100 Total loans outstanding $ 25,703,866 $ 25,375 $ 176,423 $ — $ 25,905,664 |
Schedule of analysis of the age of the recorded investment in loans outstanding by member class | May 31, 2020 (Dollars in thousands) Current 30-89 Days Past Due 90 Days or More Past Due (1) Total Past Due Total Loans Outstanding Nonaccrual Loans CFC: Distribution $ 20,769,653 $ — $ — $ — $ 20,769,653 $ — Power supply 4,731,506 — — — 4,731,506 167,708 Statewide and associate 106,498 — — — 106,498 — CFC total 25,607,657 — — — 25,607,657 167,708 NCSC 697,862 — — — 697,862 — RTFC 385,335 — — — 385,335 — Total loans outstanding $ 26,690,854 $ — $ — $ — $ 26,690,854 $ 167,708 Percentage of total loans 100.00 % — % — % — % 100.00 % 0.63 % May 31, 2019 (Dollars in thousands) Current 30-89 Days Past Due 90 Days or More Past Due (1) Total Total Loans Outstanding Nonaccrual Loans CFC: Distribution $ 20,155,266 $ — $ — $ — $ 20,155,266 $ — Power supply 4,578,841 — — — 4,578,841 — Statewide and associate 83,569 — — — 83,569 — CFC total 24,817,676 — — — 24,817,676 — NCSC 742,888 — — — 742,888 — RTFC 345,100 — — — 345,100 — Total loans outstanding $ 25,905,664 $ — $ — $ — $ 25,905,664 $ — Percentage of total loans 100.00 % — % — % — % 100.00 % — % ____________________________ (1) All loans 90 days or more past due are on nonaccrual status. |
Schedule of nonperforming and restructured loans | The following table provides a summary of loans modified as TDRs in prior periods, the performance status of these loans and the unadvanced loan commitments related to the TDR loans, by member class, as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Loans Outstanding % of Total Loans Unadvanced Commitments Loans Outstanding % of Total Loans Unadvanced Commitments TDR loans: Performing TDR loans: CFC/Distribution $ 5,755 0.02 % $ — $ 6,261 0.03 % $ — RTFC 5,092 0.02 — 5,592 0.02 — Total performing TDR loans 10,847 0.04 — 11,853 0.05 — Total TDR loans $ 10,847 0.04 % $ — $ 11,853 0.05 % $ — |
Summary of recorded investment in individually-impaired loans and the related specific valuation allowance by member class | he following table provides information on loans classified as individually impaired as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Recorded Investment Related Allowance Recorded Investment Related Allowance With no specific allowance recorded: CFC $ 5,756 $ — $ 6,261 $ — With a specific allowance recorded: CFC 167,708 33,854 RTFC 5,092 979 5,592 1,021 Total impaired loans $ 178,556 $ 34,833 $ 11,853 $ 1,021 |
Schedule of average recorded investment in impaired loans and the interest income recognized by member class | he following table presents, by company, the average recorded investment for individually impaired loans and the interest income recognized on these loans for fiscal years ended May 31, 2020, 2019 and 2018 . Average Recorded Investment Interest Income Recognized (Dollars in thousands) 2020 2019 2018 2020 2019 2018 CFC $ 11,834 $ 6,322 $ 6,524 $ 568 $ 553 $ 571 RTFC 5,361 5,861 6,361 268 293 318 Total impaired loans $ 17,195 $ 12,183 $ 12,885 $ 836 $ 846 $ 889 |
Allowance for Loan Losses - (Ta
Allowance for Loan Losses - (Tables) | 12 Months Ended |
May 31, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Financing Receivable, Allowance for Credit Loss | The following tables summarize changes, by company, in the allowance for loan losses as of and for the years ended May 31, 2020, 2019 and 2018 . Year Ended May 31, 2020 (Dollars in thousands) CFC NCSC RTFC Total Balance as of May 31, 2019 $ 13,120 $ 2,007 $ 2,408 $ 17,535 Provision (benefit) for loan losses 34,318 (1,201 ) 2,473 35,590 Balance as of May 31, 2020 $ 47,438 $ 806 $ 4,881 $ 53,125 Year Ended May 31, 2019 (Dollars in thousands) CFC NCSC RTFC Total Balance as of May 31, 2018 $ 12,300 $ 2,082 $ 4,419 $ 18,801 Provision (benefit) for loan losses 820 (75 ) (2,011 ) (1,266 ) Balance as of May 31, 2019 $ 13,120 $ 2,007 $ 2,408 $ 17,535 Year Ended May 31, 2018 (Dollars in thousands) CFC NCSC RTFC Total Balance as of May 31, 2017 $ 29,499 $ 2,910 $ 4,967 $ 37,376 Benefit for loan losses (17,199 ) (828 ) (548 ) (18,575 ) Balance as of May 31, 2018 $ 12,300 $ 2,082 $ 4,419 $ 18,801 |
Schedule of loan loss allowance and the recorded investment in outstanding loans by impairment methodology and by company | The following tables present, by company, the components of our allowance for loan losses and the recorded investment of the related loans as of May 31, 2020 and 2019 . May 31, 2020 (Dollars in thousands) CFC NCSC RTFC Total Ending balance of the allowance: Collective allowance $ 13,584 $ 806 $ 3,902 $ 18,292 Asset-specific allowance 33,854 — 979 34,833 Total ending balance of the allowance $ 47,438 $ 806 $ 4,881 $ 53,125 Recorded investment in loans: Collectively evaluated loans $ 25,434,193 $ 697,862 $ 380,243 $ 26,512,298 Individually evaluated loans 173,464 — 5,092 178,556 Total recorded investment in loans $ 25,607,657 $ 697,862 $ 385,335 $ 26,690,854 Total recorded investment in loans, net (1) $ 25,560,219 $ 697,056 $ 380,454 $ 26,637,729 Allowance coverage ratio: Allowance as a percentage of total recorded investment in loans 0.19 % 0.12 % 1.27 % 0.20 % May 31, 2019 (Dollars in thousands) CFC NCSC RTFC Total Ending balance of the allowance: Collective allowance $ 13,120 $ 2,007 $ 1,387 $ 16,514 Asset-specific allowance — — 1,021 1,021 Total ending balance of the allowance $ 13,120 $ 2,007 $ 2,408 $ 17,535 Recorded investment in loans: Collectively evaluated loans $ 24,811,415 $ 742,888 $ 339,508 $ 25,893,811 Individually evaluated loans 6,261 — 5,592 11,853 Total recorded investment in loans $ 24,817,676 $ 742,888 $ 345,100 $ 25,905,664 Total recorded investment in loans, net (1) $ 24,804,556 $ 740,881 $ 342,692 $ 25,888,129 Allowance coverage ratio: Allowance as a percentage of total recorded investment in loans 0.05 % 0.27 % 0.70 % 0.07 % ___________________________ (1) Excludes unamortized deferred loan origination costs of $11 million as of both May 31, 2020 and 2019 . |
Short-Term Borrowings (Tables)
Short-Term Borrowings (Tables) | 12 Months Ended |
May 31, 2020 | |
Debt Disclosure [Abstract] | |
Summary of short-term debt outstanding and the weighted-average effective interest rates | The following table provides comparative information on our short-term borrowings and weighted-average interest rates as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amount Weighted- Average Interest Rate Amount Weighted-Average Interest Rate Short-term borrowings: Commercial paper: Commercial paper sold through dealers, net of discounts $ — — % $ 944,616 2.46 % Commercial paper sold directly to members, at par 1,318,566 0.34 1,111,795 2.52 Total commercial paper 1,318,566 0.34 % 2,056,411 2.49 % Select notes 1,597,959 0.75 1,023,952 2.70 Daily liquidity fund notes 508,618 0.10 298,817 2.25 Medium-term notes sold to members 286,842 1.64 228,546 2.87 Farmer Mac notes payable (1) 250,000 1.06 — — Total short-term borrowings $ 3,961,985 0.62 $ 3,607,726 2.56 |
Schedule of total available and outstanding letters of credit under the revolving credit agreements | The following table presents the total commitment, the net amount available for use and the outstanding letters of credit under our committed bank revolving line of credit agreements as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in millions) Total Commitment Letters of Credit Outstanding Net Available for Use Total Commitment Letters of Credit Outstanding Net Available for Use Maturity Annual Facility Fee (1) 3-year agreement, 2021 $ — $ — $ — $ 1,440 $ — $ 1,440 November 28, 2021 7.5 bps 3-year agreement, 2022 1,315 — 1,315 — — — November 28, 2022 7.5 bps Total 3-year agreement 1,315 — 1,315 1,440 — 1,440 5-year agreement, 2023 1,410 3 1,407 1,535 3 1,532 November 28, 2023 10 bps Total $ 2,725 $ 3 $ 2,722 $ 2,975 $ 3 $ 2,972 ___________________________ |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
May 31, 2020 | |
Debt Instruments [Abstract] | |
Summary of long-term debt outstanding and the weighted-average effective interest rates | The following table displays long-term debt outstanding and the weighted-average interest rates, by debt type, as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amount Weighted- Average Maturity Date Amount Weighted- Average Maturity Date Secured long-term debt: Collateral trust bonds $ 7,457,711 3.23 % 2020-2049 $ 7,662,711 3.19 % 2019-2049 Unamortized discount (236,461 ) (244,643 ) Debt issuance costs (32,697 ) (34,336 ) Total collateral trust bonds 7,188,553 7,383,732 Guaranteed Underwriter Program notes payable 6,261,312 2.74 2025-2040 5,410,507 2.97 2025-2039 Farmer Mac notes payable 2,809,637 2.07 2020-2049 3,054,914 3.33 2019-2049 Other secured notes payable 6,068 2.69 2023 9,225 2.70 2024 Debt issuance costs (117 ) (178 ) Total other secured notes payable 5,951 9,047 Total secured notes payable 9,076,900 2.53 8,474,468 3.10 Total secured long-term debt 16,265,453 2.85 15,858,200 3.14 Unsecured long-term debt: Medium-term notes sold through dealers 3,086,733 3.34 2020-2032 2,962,375 3.55 2019-2032 Medium-term notes sold to members 372,117 2.85 2020-2037 397,080 3.03 2019-2037 Subtotal medium-term notes 3,458,850 3.29 3,359,455 3.49 Unamortized discount (997 ) (931 ) Debt issuance costs (16,943 ) (19,399 ) Total unsecured medium-term notes 3,440,910 3,339,125 Unsecured notes payable: 5,794 — 2023 13,701 3.97 2022-2023 Unamortized discount (107 ) (187 ) Debt issuance costs (26 ) (46 ) Total unsecured notes payable 5,661 13,468 Total unsecured long-term debt 3,446,571 3.29 3,352,593 3.49 Total long-term debt $ 19,712,024 2.92 $ 19,210,793 3.20 |
Schedule of amount of long-term debt maturities | The following table presents the amount of long-term debt maturing in each of the five fiscal years subsequent to May 31, 2020 and thereafter. (Dollars in thousands) Amount Weighted-Average Interest Rate 2021 $ 2,016,164 2.41 % 2022 2,517,356 2.12 2023 1,221,908 2.33 2024 1,117,749 3.00 2025 807,793 2.77 Thereafter 12,031,054 3.24 Total $ 19,712,024 2.92 |
Subordinated Deferrable Debt (T
Subordinated Deferrable Debt (Tables) | 12 Months Ended |
May 31, 2020 | |
Subordinated Debt [Abstract] | |
Schedule of Subordinated Borrowing | The following table presents subordinated deferrable debt outstanding and the weighted-average interest rates as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amount Weighted- Average Interest Rate Amount Weighted-Average Interest Rate 4.75% due 2043 with a call date of April 30, 2023 $ 400,000 4.75 % $ 400,000 4.75 % 5.25% due 2046 with a call date of April 20, 2026 350,000 5.25 350,000 5.25 5.50% due 2064 with a call date of May 15, 2024 250,000 5.50 250,000 5.50 % Debt issuance costs (13,881 ) (13,980 ) Total subordinated deferrable debt $ 986,119 5.11 $ 986,020 5.11 |
Members' Subordinated Certifi_2
Members' Subordinated Certificates (Tables) | 12 Months Ended |
May 31, 2020 | |
Members' subordinated certificates | |
Schedule of Subordinated Borrowing | The following table presents subordinated deferrable debt outstanding and the weighted-average interest rates as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amount Weighted- Average Interest Rate Amount Weighted-Average Interest Rate 4.75% due 2043 with a call date of April 30, 2023 $ 400,000 4.75 % $ 400,000 4.75 % 5.25% due 2046 with a call date of April 20, 2026 350,000 5.25 350,000 5.25 5.50% due 2064 with a call date of May 15, 2024 250,000 5.50 250,000 5.50 % Debt issuance costs (13,881 ) (13,980 ) Total subordinated deferrable debt $ 986,119 5.11 $ 986,020 5.11 |
Schedule of amount of members' subordinated certificates maturing in each of the five fiscal years | The following table presents the amount of long-term debt maturing in each of the five fiscal years subsequent to May 31, 2020 and thereafter. (Dollars in thousands) Amount Weighted-Average Interest Rate 2021 $ 2,016,164 2.41 % 2022 2,517,356 2.12 2023 1,221,908 2.33 2024 1,117,749 3.00 2025 807,793 2.77 Thereafter 12,031,054 3.24 Total $ 19,712,024 2.92 |
Subordinated certificates | |
Members' subordinated certificates | |
Schedule of Subordinated Borrowing | The following table displays members’ subordinated certificates and the weighted-average interest rates as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Amounts Outstanding Weighted- Interest Rate Amounts Outstanding Weighted- Interest Rate Membership subordinated certificates: Certificates maturing 2020 through 2119 $ 630,467 $ 630,466 Subscribed and unissued (1) 16 8 Total membership subordinated certificates 630,483 4.95 % 630,474 4.95 % Loan and guarantee subordinated certificates: Interest-bearing loan subordinated certificates maturing through 2045 280,372 290,259 Non-interest-bearing loan subordinated certificates maturing through 2047 144,258 150,152 Subscribed and unissued (1) 45 45 Total loan subordinated certificates 424,675 2.71 440,456 2.73 Interest-bearing guarantee subordinated certificates maturing through 2044 43,700 47,878 Non-interest-bearing guarantee subordinated certificates maturing through 2037 14,590 17,151 Total guarantee subordinated certificates 58,290 4.43 65,029 4.49 Total loan and guarantee subordinated certificates 482,965 2.92 505,485 2.95 Member capital securities: Securities maturing through 2050 226,170 5.00 221,170 5.00 Total members’ subordinated certificates $ 1,339,618 4.22 $ 1,357,129 4.21 ___________________________ (1) The subscribed and unissued subordinated certificates represent subordinated certificates that members are required to purchase. Upon collection of full payment of the subordinated certificate amount, the certificate will be reclassified from subscribed and unissued to outstanding. |
Schedule of amount of members' subordinated certificates maturing in each of the five fiscal years | The following table presents the amount of members’ subordinated certificates maturing in each of the five fiscal years following May 31, 2020 and thereafter. (Dollars in thousands) Amount Maturing (1) Weighted-Average Interest Rate 2021 $ 40,511 3.60 % 2022 13,339 3.07 2023 22,321 3.70 2024 15,240 2.37 2025 24,212 1.66 Thereafter 1,223,934 4.34 Total $ 1,339,557 4.22 ___________________________ (1) Excludes $0.06 million in subscribed and unissued member subordinated certificates for which a payment has been received, but no certificate has been issued. Amortizing member loan subordinated certificates totaling $239 million are amortizing annually based on the unpaid principal balance of the related loan. Amortization payments on these certificates totaled $14 million in fiscal year 2020 and represented 6% of amortizing loan subordinated certificates outstanding. |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
May 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of notional amounts outstanding and the weighted average interest rate paid and received for the entity's interest rate swaps | The following table shows the outstanding notional amounts and the weighted-average rate paid and received for our interest rate swaps, by type, as of May 31, 2020 and 2019 . The substantial majority of our interest rate swaps use an index based on LIBOR for either the pay or receive leg of the swap agreement. May 31, 2020 2019 (Dollars in thousands) Notional Amount Weighted- Average Rate Paid Weighted- Average Rate Received Notional Weighted- Weighted- Pay-fixed swaps $ 6,604,808 2.78 % 0.88 % $ 7,379,280 2.83 % 2.60 % Receive-fixed swaps 2,699,000 1.54 2.75 3,399,000 3.25 2.56 Total interest rate swaps 9,303,808 2.42 1.42 10,778,280 2.97 2.58 Forward pay-fixed swaps 3,000 65,000 Total $ 9,306,808 $ 10,843,280 |
Schedule of Derivative Instruments Maturity | The following table presents the maturities for each of the next five fiscal years and thereafter based on the notional amount of our interest rate swaps as of May 31, 2020 . Notional Amount Notional Amortization and Maturities (Dollars in thousands) 2021 2022 2023 2024 2025 Thereafter Interest rate swaps $9,306,808 $466,602 $749,854 $323,082 $655,899 $100,000 $7,011,371 |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table displays the fair value of the derivative assets and derivative liabilities recorded on our consolidated balance sheets and the related outstanding notional amount of our interest rate swaps by derivatives type as of May 31, 2020 and 2019 . May 31, 2020 2019 (Dollars in thousands) Fair Value Notional Balance Fair Value Notional Balance Derivative assets: Interest rate swaps $ 173,195 $ 2,699,000 $ 41,179 $ 2,332,104 Derivative liabilities: Interest rate swaps $ 1,258,459 $ 6,607,808 $ 391,724 $ 8,511,176 |
Offsetting Assets | The following table presents the gross fair value of derivative assets and liabilities reported on our consolidated balance sheets as of May 31, 2020 and 2019 , and provides information on the impact of netting provisions and collateral pledged. May 31, 2020 Gross Amount of Recognized Assets/ Liabilities Gross Amount Offset in the Balance Sheet Net Amount of Assets/ Liabilities Presented in the Balance Sheet Gross Amount Not Offset in the Balance Sheet (Dollars in thousands) Financial Instruments Cash Collateral Pledged Net Amount Derivative assets: Interest rate swaps $ 173,195 $ — $ 173,195 $ 173,195 $ — $ — Derivative liabilities: Interest rate swaps 1,258,459 — 1,258,459 173,195 — 1,085,264 May 31, 2019 Gross Amount Gross Amount Net Amount of Assets/ Liabilities Gross Amount (Dollars in thousands) Financial Cash Net Derivative assets: Interest rate swaps $ 41,179 $ — $ 41,179 $ 41,176 $ — $ 3 Derivative liabilities: Interest rate swaps 391,724 — 391,724 41,176 — 350,548 |
Offsetting Liabilities | The following table presents the gross fair value of derivative assets and liabilities reported on our consolidated balance sheets as of May 31, 2020 and 2019 , and provides information on the impact of netting provisions and collateral pledged. May 31, 2020 Gross Amount of Recognized Assets/ Liabilities Gross Amount Offset in the Balance Sheet Net Amount of Assets/ Liabilities Presented in the Balance Sheet Gross Amount Not Offset in the Balance Sheet (Dollars in thousands) Financial Instruments Cash Collateral Pledged Net Amount Derivative assets: Interest rate swaps $ 173,195 $ — $ 173,195 $ 173,195 $ — $ — Derivative liabilities: Interest rate swaps 1,258,459 — 1,258,459 173,195 — 1,085,264 May 31, 2019 Gross Amount Gross Amount Net Amount of Assets/ Liabilities Gross Amount (Dollars in thousands) Financial Cash Net Derivative assets: Interest rate swaps $ 41,179 $ — $ 41,179 $ 41,176 $ — $ 3 Derivative liabilities: Interest rate swaps 391,724 — 391,724 41,176 — 350,548 |
Summary of gains and losses recorded on the consolidated statements of operations for the entity's interest rate swaps | The following table presents the components of the derivative gains (losses) reported in our consolidated statements of operations for our interest rate swaps for fiscal years 2020 , 2019 and 2018 . Year Ended May 31, (Dollars in thousands) 2020 2019 2018 Derivative gains (losses) attributable to: Derivative cash settlements expense $ (55,873 ) $ (43,611 ) $ (74,281 ) Derivative forward value gains (losses) (734,278 ) (319,730 ) 306,002 Derivative gains (losses) $ (790,151 ) $ (363,341 ) $ 231,721 |
Schedule of notional amounts of derivative instruments having rating triggers | The following table displays the notional amounts of our derivative contracts with rating triggers as of May 31, 2020 , and the payments that would be required if the contracts were terminated as of that date because of a downgrade of our unsecured credit ratings or the counterparty’s unsecured credit ratings below A3/A-, below Baa1/BBB+, to or below Baa2/BBB, below Baa3/BBB-, or to or below Ba2/BB+ by Moody’s or S&P, respectively. In calculating the payment amounts that would be required upon termination of the derivative contracts, we assumed that the amounts for each counterparty would be netted in accordance with the provisions of the master netting agreements for each counterparty. The net payment amounts are based on the fair value of the underlying derivative instrument, excluding the credit risk valuation adjustment, plus any unpaid accrued interest amounts. (Dollars in thousands) Notional Amount Payable Due from CFC Receivable Due to CFC Net (Payable)/Receivable Impact of rating downgrade trigger: Falls below A3/A- (1) $ 45,860 $ (11,305 ) $ — $ (11,305 ) Falls below Baa1/BBB+ 6,091,198 (692,210 ) — (692,210 ) Falls to or below Baa2/BBB (2) 421,303 (33,958 ) — (33,958 ) Falls below Baa3/BBB- 45,280 (15,677 ) — (15,677 ) Total $ 6,603,641 $ (753,150 ) $ — $ (753,150 ) ___________________________ (1) Rating trigger for CFC falls below A3/A-, while rating trigger for counterparty falls below Baa1/BBB+ by Moody’s or S&P, respectively. (2) Rating trigger for CFC falls to or below Baa2/BBB, while rating trigger for counterparty falls to or below Ba2/BB+ by Moody’s or S&P, respectively. |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
May 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of components of equity | The following table presents the components of equity as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Membership fees $ 969 $ 969 Educational fund 2,224 2,013 Total membership fees and educational fund 3,193 2,982 Patronage capital allocated 894,066 860,578 Members’ capital reserve 807,320 759,097 Unallocated net income (loss): Prior year-end cumulative derivative forward value losses (348,965 ) (30,831 ) Current-year derivative forward value losses (1) (730,774 ) (318,134 ) Current year-end cumulative derivative forward value losses (1,079,739 ) (348,965 ) Other unallocated net income 3,191 3,190 Unallocated net loss (1,076,548 ) (345,775 ) CFC retained equity 628,031 1,276,882 Accumulated other comprehensive loss (1,910 ) (147 ) Total CFC equity 626,121 1,276,735 Noncontrolling interests 22,701 27,147 Total equity $ 648,822 $ 1,303,882 ____________________________ (1) Represents derivative forward value gains (losses) for CFC only, as total CFC equity does not include the noncontrolling interests of the consolidated variable interest entities NCSC and RTFC. See “Note 15—Business Segments” for the statements of operations for CFC. |
Summary of activity in accumulated other comprehensive income account by component | The following tables summarize, by component, the activity in AOCI as of and for the years ended May 31, 2020 and 2019 . Year Ended May 31, 2020 (Dollars in thousands) Unrealized Gains (Losses) Equity Securities Unrealized Gains (1) Unrealized Gains (Losses) Cash Flow Hedges Unrealized Losses Defined Benefit Plan (2) Total Beginning balance $ — $ 2,571 $ — $ (2,718 ) $ (147 ) Gains reclassified into earnings — (441 ) — — (441 ) Defined benefit plan adjustments — — — (1,322 ) (1,322 ) Other comprehensive loss — (441 ) — (1,322 ) (1,763 ) Ending balance $ — $ 2,130 $ — $ (4,040 ) $ (1,910 ) Year Ended May 31, 2019 (Dollars in thousands) Unrealized Gains (Losses) Equity Securities Unrealized Gains Derivatives (1) Unrealized Gains (Losses) Cash Flow Hedges Unrealized Losses Defined Benefit Plan (2) Total Beginning balance $ 8,794 $ 3,039 $ (1,059 ) $ (2,230 ) $ 8,544 Cumulative effect of changes from adoption of new accounting standards (8,794 ) — — — (8,794 ) Unrealized gains — — 1,059 — 1,059 Gains reclassified into earnings — (468 ) — — (468 ) Defined benefit plan adjustments — — — (488 ) (488 ) Other comprehensive income (loss) — (468 ) 1,059 (488 ) 103 Ending balance $ — $ 2,571 $ — $ (2,718 ) $ (147 ) |
Guarantees (Tables)
Guarantees (Tables) | 12 Months Ended |
May 31, 2020 | |
Guarantees [Abstract] | |
Summary of total guarantees by type of guarantee and member class | The following table summarizes total guarantees, by type of guarantee and by member class, as of May 31, 2020 and 2019 . May 31, (Dollars in thousands) 2020 2019 Guarantee type: Long-term tax-exempt bonds (1) $ 263,875 $ 312,190 Letters of credit (2) 413,839 379,001 Other guarantees 143,072 146,244 Total $ 820,786 $ 837,435 Member class: CFC: Distribution $ 266,301 $ 235,919 Power supply 538,532 586,717 Statewide and associate (3) 5,954 4,708 CFC total 810,787 827,344 NCSC 9,999 8,517 RTFC — 1,574 Total $ 820,786 $ 837,435 ____________________________ (1) Represents the outstanding principal amount of long-term fixed-rate and variable-rate guaranteed bonds. (2) Reflects our maximum potential exposure for letters of credit. |
Schedule of maturities of outstanding guarantees | The following table details the scheduled maturities of our outstanding guarantees in each of the five fiscal years following May 31, 2020 and thereafter: (Dollars in thousands) Amount Maturing 2021 $ 339,979 2022 29,265 2023 157,411 2024 32,824 2025 83,628 Thereafter 177,679 Total $ 820,786 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
May 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of carrying and fair values for entity's financial instruments | The following tables present the carrying value and fair value for all of our financial instruments, including those carried at amortized cost, as of May 31, 2020 and 2019 . The tables also display the classification within the fair value hierarchy of the valuation technique used in estimating fair value. May 31, 2020 Fair Value Measurement Level (Dollars in thousands) Carrying Value Fair Value Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 671,372 $ 671,372 $ 671,372 $ — $ — Restricted cash 8,647 8,647 8,647 — — Equity securities 60,735 60,735 60,735 — — Debt securities trading 309,400 309,400 — 309,400 — Deferred compensation investments 5,496 5,496 5,496 — — Loans to members, net 26,649,255 29,252,065 — — 29,252,065 Accrued interest receivable 117,138 117,138 — 117,138 — Debt service reserve funds 14,591 14,591 14,591 — — Derivative assets 173,195 173,195 — 173,195 — Liabilities: Short-term borrowings $ 3,961,985 $ 3,963,164 $ — $ 3,713,164 $ 250,000 Long-term debt 19,712,024 21,826,337 — 11,981,580 9,844,757 Accrued interest payable 139,619 139,619 — 139,619 — Guarantee liability 10,937 11,948 — — 11,948 Derivative liabilities 1,258,459 1,258,459 — 1,258,459 — Subordinated deferrable debt 986,119 1,030,108 — 1,030,108 — Members’ subordinated certificates 1,339,618 1,339,618 — — 1,339,618 May 31, 2019 Fair Value Measurement Level (Dollars in thousands) Carrying Value Fair Value Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 177,922 $ 177,922 $ 177,922 $ — $ — Restricted cash 8,282 8,282 8,282 — — Equity securities 87,533 87,533 87,533 — — Debt securities held-to-maturity 565,444 570,549 — 570,549 — Deferred compensation investments 4,984 4,984 4,984 — — Loans to members, net 25,899,369 25,743,503 — — 25,743,503 Accrued interest receivable 133,605 133,605 — 133,605 — Debt service reserve funds 17,151 17,151 17,151 — — Derivative assets 41,179 41,179 — 41,179 — Liabilities: Short-term borrowings $ 3,607,726 $ 3,608,259 $ — $ 3,608,259 $ — Long-term debt 19,210,793 20,147,183 — 11,482,715 8,664,468 Accrued interest payable 158,997 158,997 — 158,997 — Guarantee liability 13,666 13,307 — — 13,307 Derivative liabilities 391,724 391,724 — 391,724 — Subordinated deferrable debt 986,020 1,004,707 — 1,004,707 — Members’ subordinated certificates 1,357,129 1,357,129 — — 1,357,129 |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents the carrying value and fair value of financial instruments reported in our consolidated financial statements at fair value on a recurring basis as of May 31, 2020 and 2019 and the classification of the valuation technique within the fair value hierarchy. May 31, 2020 2019 (Dollars in thousands) Level 1 Level 2 Total Level 1 Level 2 Total Equity securities $ 60,735 $ — $ 60,735 $ 87,533 $ — $ 87,533 Debt securities trading — 309,400 309,400 — — — Deferred compensation investments 5,496 — 5,496 4,984 — 4,984 Derivative assets — 173,195 173,195 — 41,179 41,179 Derivative liabilities — 1,258,459 1,258,459 — 391,724 391,724 |
Business Segments (Tables)
Business Segments (Tables) | 12 Months Ended |
May 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of segment presentation for the consolidated statements of operations and consolidated balance sheets | The following tables display segment results for the years ended May 31, 2020, 2019 and 2018 , and assets attributable to each segment as of May 31, 2020 and 2019 . Year Ended May 31, 2020 (Dollars in thousands) CFC Other Elimination Consolidated Statement of operations: Interest income $ 1,143,397 $ 47,107 $ (39,218 ) $ 1,151,286 Interest expense (820,841 ) (39,466 ) 39,218 (821,089 ) Net interest income 322,556 7,641 — 330,197 Provision for loan losses (35,590 ) — — (35,590 ) Net interest income after provision for loan losses 286,966 7,641 — 294,607 Non-interest income: Fee and other income 28,309 9,524 (14,872 ) 22,961 Derivative losses: Derivative cash settlements expense (54,707 ) (1,166 ) — (55,873 ) Derivative forward value losses (730,774 ) (3,504 ) — (734,278 ) Derivative losses (785,481 ) (4,670 ) — (790,151 ) Investment securities gains 9,431 — — 9,431 Total non-interest income (747,741 ) 4,854 (14,872 ) (757,759 ) Non-interest expense: General and administrative expenses (98,808 ) (8,940 ) 6,581 (101,167 ) Losses on early extinguishment of debt (69 ) (614 ) — (683 ) Other non-interest expense (25,588 ) (8,291 ) 8,291 (25,588 ) Total non-interest expense (124,465 ) (17,845 ) 14,872 (127,438 ) Loss before income taxes (585,240 ) (5,350 ) — (590,590 ) Income tax benefit — 1,160 — 1,160 Net loss $ (585,240 ) $ (4,190 ) $ — $ (589,430 ) May 31, 2020 CFC Other Elimination Consolidated Assets: Total loans outstanding $ 26,669,759 $ 1,083,197 $ (1,062,102 ) $ 26,690,854 Deferred loan origination costs 11,526 — — 11,526 Loans to members 26,681,285 1,083,197 (1,062,102 ) 26,702,380 Less: Allowance for loan losses (53,125 ) — — (53,125 ) Loans to members, net 26,628,160 1,083,197 (1,062,102 ) 26,649,255 Other assets 1,496,998 106,525 (95,173 ) 1,508,350 Total assets $ 28,125,158 $ 1,189,722 $ (1,157,275 ) $ 28,157,605 Year Ended May 31, 2019 (Dollars in thousands) CFC Other Elimination Consolidated Statement of operations: Interest income $ 1,126,869 $ 51,741 $ (42,940 ) $ 1,135,670 Interest expense (835,491 ) (43,658 ) 42,940 (836,209 ) Net interest income 291,378 8,083 — 299,461 Benefit for loan losses 1,266 — — 1,266 Net interest income after benefit for loan losses 292,644 8,083 — 300,727 Non-interest income: Fee and other income 20,515 2,655 (7,815 ) 15,355 Derivative losses: Derivative cash settlements expense (42,618 ) (993 ) — (43,611 ) Derivative forward value losses (318,135 ) (1,595 ) — (319,730 ) Derivative losses (360,753 ) (2,588 ) — (363,341 ) Investment securities losses (1,799 ) — — (1,799 ) Total non-interest income (342,037 ) 67 (7,815 ) (349,785 ) Non-interest expense: General and administrative expenses (91,063 ) (8,477 ) 6,374 (93,166 ) Losses on early extinguishment of debt (7,100 ) — — (7,100 ) Other non-interest expense (1,675 ) (1,441 ) 1,441 (1,675 ) Total non-interest expense (99,838 ) (9,918 ) 7,815 (101,941 ) Loss before income taxes (149,231 ) (1,768 ) — (150,999 ) Income tax expense — (211 ) — (211 ) Net loss $ (149,231 ) $ (1,979 ) $ — $ (151,210 ) May 31, 2019 CFC Other Elimination Consolidated Assets: Total loans outstanding $ 25,877,305 $ 1,087,988 $ (1,059,629 ) $ 25,905,664 Deferred loan origination costs 11,240 — — 11,240 Loans to members 25,888,545 1,087,988 (1,059,629 ) 25,916,904 Less: Allowance for loan losses (17,535 ) — — (17,535 ) Loans to members, net 25,871,010 1,087,988 (1,059,629 ) 25,899,369 Other assets 1,214,045 104,890 (93,932 ) 1,225,003 Total assets $ 27,085,055 $ 1,192,878 $ (1,153,561 ) $ 27,124,372 Year Ended May 31, 2018 (Dollars in thousands) CFC Other Elimination Consolidated Statement of operations: Interest income $ 1,067,016 $ 49,182 $ (38,841 ) $ 1,077,357 Interest expense (791,836 ) (39,740 ) 38,841 (792,735 ) Net interest income 275,180 9,442 — 284,622 Benefit for loan losses 18,575 — — 18,575 Net interest income after benefit for loan losses 293,755 9,442 — 303,197 Non-interest income: Fee and other income 17,369 1,372 (1,163 ) 17,578 Derivative gains (losses): Derivative cash settlements expense (71,906 ) (2,375 ) — (74,281 ) Derivative forward value gains 301,694 4,308 — 306,002 Derivative gains 229,788 1,933 — 231,721 Total non-interest income 247,157 3,305 (1,163 ) 249,299 Non-interest expense: General and administrative expenses (83,783 ) (7,101 ) — (90,884 ) Other non-interest expense (1,943 ) (1,163 ) 1,163 (1,943 ) Total non-interest expense (85,726 ) (8,264 ) 1,163 (92,827 ) Income before income taxes 455,186 4,483 — 459,669 Income tax expense — (2,305 ) — (2,305 ) Net income $ 455,186 $ 2,178 $ — $ 457,364 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies Fixed Assets (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Fixed Assets | ||
Fixed assets, gross | $ 107,097 | $ 129,163 |
Less: accumulated depreciation | (59,007) | (53,695) |
Net depreciable fixed assets | 48,090 | 75,468 |
Fixed assets, net | 89,137 | 120,627 |
Building and building equipment | ||
Fixed Assets | ||
Fixed assets, gross | 50,087 | 50,167 |
Furniture and fixtures | ||
Fixed Assets | ||
Fixed assets, gross | 6,015 | 6,012 |
Computer software and hardware | ||
Fixed Assets | ||
Fixed assets, gross | 49,944 | 71,915 |
Other | ||
Fixed Assets | ||
Fixed assets, gross | 1,051 | 1,069 |
Land | ||
Fixed Assets | ||
Fixed assets, gross | 23,796 | 23,796 |
Construction-in-progress and software | ||
Fixed Assets | ||
Fixed assets, gross | $ 17,251 | $ 21,363 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies Interest Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
May 31, 2020 | May 31, 2019 | May 31, 2018 | ||
Components of interest income | ||||
Interest income | $ (1,151,286) | $ (1,135,670) | $ (1,077,357) | |
Investment Income, Interest | 21,403 | 24,609 | 11,814 | |
Fixed rate | ||||
Components of interest income | ||||
Interest income | [1] | (1,043,918) | (1,012,277) | (1,000,492) |
Variable rate | ||||
Components of interest income | ||||
Interest income | (31,293) | (41,219) | (27,152) | |
Lines of credit | ||||
Components of interest income | ||||
Interest income | (55,140) | (57,847) | (38,195) | |
Restructured loans | ||||
Components of interest income | ||||
Interest income | [2] | (836) | (846) | (889) |
Fee income | ||||
Components of interest income | ||||
Interest income | [3] | (1,304) | (1,128) | (1,185) |
Loans Receivable [Member] | ||||
Components of interest income | ||||
Interest income | $ (1,129,883) | $ (1,111,061) | $ (1,065,543) | |
[1] | Includes loan conversion fees, which are generally deferred and recognized as interest income using the effective interest method. | |||
[2] | Troubled debt restructured (“TDR”) loans. | |||
[3] | Consists of late payment fees, commitment fees and net amortization of deferred loan fees and loan origination costs. |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies Interest Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
May 31, 2020 | May 31, 2019 | May 31, 2018 | ||
Interest expense on debt: | ||||
Total interest expense | [1],[2] | $ 821,089 | $ 836,209 | $ 792,735 |
Short-term borrowings | ||||
Interest expense on debt: | ||||
Interest expense on debt | [1],[2] | 77,995 | 92,854 | 50,616 |
Medium-term notes | ||||
Interest expense on debt: | ||||
Interest expense on debt | [1],[2] | 125,954 | 133,797 | 111,814 |
Collateral trust bonds | ||||
Interest expense on debt: | ||||
Interest expense on debt | [1],[2] | 257,396 | 273,413 | 336,079 |
Guaranteed Underwriter Program Notes Payable | ||||
Interest expense on debt: | ||||
Interest expense on debt | 162,929 | 147,895 | 140,551 | |
Farmer Mac Notes Payable | ||||
Interest expense on debt: | ||||
Interest expense on debt | [1],[2] | 87,617 | 90,942 | 56,004 |
Long-term notes payable | ||||
Interest expense on debt: | ||||
Interest expense on debt | [1],[2] | 671 | 1,237 | 1,509 |
Subordinated deferrable debt | ||||
Interest expense on debt: | ||||
Interest expense on debt | [1],[2] | 51,527 | 38,628 | 37,661 |
Subordinated certificates | ||||
Interest expense on debt: | ||||
Interest expense on debt | [1],[2] | $ 57,000 | $ 57,443 | $ 58,501 |
[1] | (1) Includes amortization of debt discounts and debt issuance costs, which are generally deferred and recognized as interest expense using the effective interest method. Issuance costs related to dealer commercial paper, however, are recognized as interest expense immediately as incurred. | |||
[2] | (2) Includes fees related to funding arrangements, such as up-front fees paid to banks participating in our committed bank revolving line of credit agreements. Depending on the nature of the fee, amounts may be deferred and recognized as interest expense ratably over the term of the arrangement or recognized immediately as incurred. |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies Additional Information (Details) - USD ($) | Jul. 22, 2019 | May 31, 2020 | May 31, 2019 | May 31, 2018 |
Summary of Significant Accounting Policies [Line Items] | ||||
Debt Securities, Held-to-maturity, Transfer to Trading, Unrealized Gain (Loss) | $ 1,000,000 | |||
Repossessed Assets | 0 | $ 0 | ||
Restricted cash | 8,647,000 | 8,282,000 | ||
Depreciation and amortization | 9,238,000 | 9,305,000 | $ 7,931,000 | |
Real Estate Held-for-sale | 14,000,000 | |||
Deferred income | 59,303,000 | 57,989,000 | ||
Deferred Loan Conversion Fees | 53,000,000 | 52,000,000 | ||
Proceeds from Sale of Land Held-for-investment | $ 22,000,000 | |||
Gain on sale of land | (7,713,000) | 0 | 0 | |
Asset Impairment Charges | $ 31,284,000 | $ 0 | $ 0 | |
Maximum | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Estimated useful lives | 40 years | |||
Minimum | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Estimated useful lives | 3 years | |||
NCSC | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Membership fees (in dollars per share) | $ 100 | |||
Effective percentage of tax rate | 21.00% | 21.00% | 29.00% | |
Deferred Tax Assets, Net | $ 3,000,000 | $ 2,000,000 | ||
RTFC | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Effective percentage of tax rate | 21.00% | 21.00% | 12.00% | |
RTFC | Minimum | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Percentage of income from patronage sources allocated to borrowers to be retired in cash prior to filing the applicable tax return | 20.00% | |||
Distribution system members | CFC | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Membership fees (in dollars per share) | $ 1,000 | |||
Service organization members | CFC | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Membership fees (in dollars per share) | 200 | |||
Associates | CFC | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Membership fees (in dollars per share) | 1,000 | |||
Associates | RTFC | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Membership fees (in dollars per share) | 100 | |||
Voting members | RTFC | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Membership fees (in dollars per share) | $ 1,000 | |||
Unadvanced commitments not subject to material adverse change clauses | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Loans and Leases Receivable Unadvanced Commitments Period Maximum | 5 years | |||
Unadvanced commitments | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Loans and Leases Receivable Unadvanced Commitments Period Maximum | 5 years | |||
Land | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Gain on sale of land | $ (8,000,000) |
Variable Interest Entities Cons
Variable Interest Entities Consolidated Assets and Liabilities of VIEs included in CFC's Consolidated Financial Statements (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Variable Interest Entity [Line Items] | |||
Loans to members | $ 26,702,380 | $ 25,916,904 | [1] |
Other assets | 37,627 | 53,699 | |
Total assets | 28,157,605 | 27,124,372 | |
Long-term Debt | 19,712,024 | 19,210,793 | |
Other liabilities | 51,656 | 50,112 | |
Total liabilities | $ 27,508,783 | $ 25,820,490 | |
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Variable Interest Entities - In
Variable Interest Entities - Information on CFCs Credit Commitments to NCSC and RTFC (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |||
Variable Interest Entity [Line Items] | |||||
Guarantor Obligations, Current Carrying Value | $ 820,786 | $ 837,435 | |||
Loans and Leases Receivable, Gross | 26,702,380 | 25,916,904 | [1] | ||
Liabilities | 27,508,783 | 25,820,490 | |||
Assets | 28,157,605 | 27,124,372 | |||
Other Liabilities | 51,656 | 50,112 | |||
Long-term Debt | 19,712,024 | 19,210,793 | |||
Consolidated variable interest entities | |||||
Variable Interest Entity [Line Items] | |||||
CFC credit commitments | 5,500,000 | 5,500,000 | |||
Other Borrowings | 1,062,103 | [2] | 1,059,629 | ||
Guarantor Obligations, Current Carrying Value | 9,999 | 10,091 | |||
Other credit enhancements | 11,755 | 14,251 | |||
Total credit enhancements(2) | [3] | 21,754 | 24,342 | ||
Total outstanding commitments | 1,083,857 | 1,083,971 | |||
CFC available credit commitments | 4,416,143 | 4,416,029 | |||
Guarantor Obligations, Maximum Exposure, Undiscounted | 22,000 | ||||
Loans and Leases Receivable, Gross | 1,083,197 | 1,087,988 | |||
Liabilities | 38,803 | 39,385 | |||
Assets | 1,094,549 | 1,098,951 | |||
Other Liabilities | 38,803 | 33,385 | |||
Long-term Debt | $ 0 | $ 6,000 | |||
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. | ||||
[2] | Borrowings payable to CFC are eliminated in consolidation. | ||||
[3] | Excludes interest due on these instruments. |
Variable Interest Entities Addi
Variable Interest Entities Additional Information (Details) $ in Thousands | May 31, 2020USD ($)directorvote | May 31, 2019USD ($) |
Variable Interest Entity [Line Items] | ||
Prepaid Expense and Other Assets | $ | $ 37,627 | $ 53,699 |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Variable Interest Entity [Line Items] | ||
Prepaid Expense and Other Assets | $ | $ 11,352 | $ 10,963 |
RTFC | Variable Interest Entity, Primary Beneficiary [Member] | ||
Variable Interest Entity [Line Items] | ||
Number of Votes Per Member for Election of Directors | vote | 1 | |
NCSC | Variable Interest Entity, Primary Beneficiary [Member] | ||
Variable Interest Entity [Line Items] | ||
Number of Directors for Whom Nomination Process is Controlled | director | 1 | |
Number of Votes Per Member for Election of Directors | vote | 1 |
Investment Securities - Fair va
Investment Securities - Fair value of Equity Securities (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Debt and Equity Securities, FV-NI [Line Items] | ||
Equity securities | $ 60,735 | $ 87,533 |
Preferred Stock | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Equity securities | 55,640 | 82,445 |
Common Stock | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Equity securities | $ 5,095 | $ 5,088 |
Investment Securities - Debt Se
Investment Securities - Debt Securities and Corresponding Gross Unrealized Gains and Losses (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | $ 309,400 | $ 0 |
Debt Securities, Held-to-maturity | 0 | 565,444 |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 6,072 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | (967) | |
Certificates of deposit | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | 5,585 | |
Debt Securities, Held-to-maturity | 1,000 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 0 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | 0 | |
Commercial paper | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt Securities, Held-to-maturity | 12,395 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 0 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | 0 | |
U.S. agency debt securities | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt Securities, Held-to-maturity | 3,207 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 108 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | 0 | |
Corporate debt securities | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | 253,153 | |
Debt Securities, Held-to-maturity | 478,578 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 4,989 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | (912) | |
Agency | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | 7,655 | |
Debt Securities, Held-to-maturity | 7,255 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 291 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | 0 | |
Non-agency | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | 3,207 | |
Debt Securities, Held-to-maturity | 3,453 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 0 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | (7) | |
Total commercial MBS | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | 10,862 | |
Debt Securities, Held-to-maturity | 10,708 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 291 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | (7) | |
U.S. state and municipality debt securities | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | 8,296 | |
Debt Securities, Held-to-maturity | 9,608 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 352 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | 0 | |
Foreign government debt securities | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt Securities, Held-to-maturity | 1,254 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 42 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | 0 | |
Asset-backed Securities | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Debt securities trading, at fair value | $ 31,504 | |
Debt Securities, Held-to-maturity | 48,694 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Gain | 290 | |
Debt Securities, Held-to-maturity, Accumulated Unrecognized Loss | $ (48) |
Investment Securities - Fair _2
Investment Securities - Fair Value and Gross Unrealized Losses for Investments in a Gross Loss Position (Details) - USD ($) | May 31, 2020 | May 31, 2019 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Loss [Abstract] (Deprecated 2018-01-31) | ||
Less than 12 months, Fair value, held-to-maturity | $ 52,665,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (206,000) | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Fair Value | 179,374,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (761,000) | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Fair Value | 232,039,000 | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Accumulated Loss | (967,000) | |
Commercial paper | ||
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Loss [Abstract] (Deprecated 2018-01-31) | ||
Less than 12 months, Fair value, held-to-maturity | 2,688,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Fair Value | $ 1,000 | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Fair Value | 2,688,000 | |
Corporate debt securities | ||
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Loss [Abstract] (Deprecated 2018-01-31) | ||
Less than 12 months, Fair value, held-to-maturity | 45,999,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (198,000) | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Fair Value | 164,086,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (714,000) | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Fair Value | 210,085,000 | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Accumulated Loss | (912,000) | |
Non-agency | ||
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Loss [Abstract] (Deprecated 2018-01-31) | ||
Less than 12 months, Fair value, held-to-maturity | 1,996,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (4,000) | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Fair Value | 1,448,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (3,000) | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Fair Value | 3,444,000 | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Accumulated Loss | (7,000) | |
Asset-backed Securities | ||
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Loss [Abstract] (Deprecated 2018-01-31) | ||
Less than 12 months, Fair value, held-to-maturity | 1,982,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (4,000) | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Fair Value | 13,840,000 | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (44,000) | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Fair Value | 15,822,000 | |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Accumulated Loss | $ (48,000) |
Investment Securities - Remaini
Investment Securities - Remaining Contractual Maturity Based on Amortized Cost and Fair Value of HTM by Type (Details) (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Schedule of Held-to-maturity Securities [Line Items] | ||
Due in 1 Year or Less | $ 64,828 | |
Due 1 Year through 5 Years | 475,368 | |
Due 5 Years through 10 Years | 21,795 | |
Due 10 Years | 3,453 | |
Debt Securities, Held-to-maturity | $ 0 | 565,444 |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling within One Year, Fair Value | 64,722 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 479,864 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value | 22,517 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after 10 Years, Fair Value | 3,446 | |
Debt Securities, Held-to-maturity, Fair Value | $ 570,549 | |
Held to Maturity Securities Expected Debt Maturities Next Rolling Twelve Months Weighted Average Yield | 2.08% | |
Held to Maturity Securities, Expected Debt Maturities, Rolling Year Two Through Five, Weighted-Average Yield | 3.10% | |
Held-to-Maturity Securities, Expected Debt Maturities, Rolling Year Six Through Ten, Weighted-Average Yield | 3.07% | |
Debt Securities, Held-to-Maturity, Weighted Average Yield, Maturity, after Year 10 | 3.26% | |
Held To Maturity Securities Expected Debt Maturities Weighted Average Yield | 2.98% | |
Certificates of deposit | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due in 1 Year or Less | $ 0 | |
Due 1 Year through 5 Years | 1,000 | |
Debt Securities, Held-to-maturity | 1,000 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling within One Year, Fair Value | 0 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 1,000 | |
Debt Securities, Held-to-maturity, Fair Value | 1,000 | |
Commercial paper | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due in 1 Year or Less | 12,395 | |
Debt Securities, Held-to-maturity | 12,395 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling within One Year, Fair Value | 12,395 | |
Debt Securities, Held-to-maturity, Fair Value | 12,395 | |
U.S. agency debt securities | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due 1 Year through 5 Years | 2,678 | |
Due 5 Years through 10 Years | 529 | |
Debt Securities, Held-to-maturity | 3,207 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 2,769 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value | 546 | |
Debt Securities, Held-to-maturity, Fair Value | 3,315 | |
Corporate debt securities | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due in 1 Year or Less | 51,923 | |
Due 1 Year through 5 Years | 414,788 | |
Due 5 Years through 10 Years | 11,867 | |
Debt Securities, Held-to-maturity | 478,578 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling within One Year, Fair Value | 51,818 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 418,606 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value | 12,231 | |
Debt Securities, Held-to-maturity, Fair Value | 482,655 | |
Agency | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due 1 Year through 5 Years | 310 | |
Due 5 Years through 10 Years | 6,945 | |
Debt Securities, Held-to-maturity | 7,255 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 317 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value | 7,229 | |
Debt Securities, Held-to-maturity, Fair Value | 7,546 | |
Non-agency | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due 10 Years | 3,453 | |
Debt Securities, Held-to-maturity | 3,453 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after 10 Years, Fair Value | 3,446 | |
Debt Securities, Held-to-maturity, Fair Value | 3,446 | |
Total commercial MBS | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due 1 Year through 5 Years | 310 | |
Due 5 Years through 10 Years | 6,945 | |
Due 10 Years | 3,453 | |
Debt Securities, Held-to-maturity | 10,708 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 317 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value | 7,229 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after 10 Years, Fair Value | 3,446 | |
Debt Securities, Held-to-maturity, Fair Value | 10,992 | |
U.S. state and municipality debt securities | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due 1 Year through 5 Years | 9,608 | |
Due 5 Years through 10 Years | 0 | |
Debt Securities, Held-to-maturity | 9,608 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 9,960 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value | 0 | |
Debt Securities, Held-to-maturity, Fair Value | 9,960 | |
Foreign government debt securities | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due 1 Year through 5 Years | 1,254 | |
Debt Securities, Held-to-maturity | 1,254 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 1,296 | |
Debt Securities, Held-to-maturity, Fair Value | 1,296 | |
Asset-backed Securities | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Due in 1 Year or Less | 510 | |
Due 1 Year through 5 Years | 45,730 | |
Due 5 Years through 10 Years | 2,454 | |
Debt Securities, Held-to-maturity | 48,694 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling within One Year, Fair Value | 509 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after One Through Five Years, Fair Value | 45,916 | |
Debt Securities, Held-to-maturity, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value | 2,511 | |
Debt Securities, Held-to-maturity, Fair Value | $ 48,936 |
Investment Securities Additiona
Investment Securities Additional Information (Details) - USD ($) | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Debt and Equity Securities, FV-NI [Line Items] | |||
Equity Securities, FV-NI, Unrealized Gain (Loss) | $ (1,799,000) | ||
Proceeds from Sale of Debt and Equity Securities, FV-NI, Held-for-investment | $ 239,000,000 | ||
Investment securities gains (losses) | 2,000,000 | ||
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax | $ 0 | $ 0 | $ 3,222,000 |
Preferred Stock, Redemption Price Per Share | $ 25 | ||
Equity Securities, FV-NI, Realized Gain (Loss) | $ 200,000 | ||
Debt Securities, Held-to-maturity, Transfer, Amount | 571,000,000 | ||
Average Contractual Maturity of Held-to-maturity Securities | 3 years | ||
Held To Maturity Securities Expected Debt Maturities Weighted Average Yield | 2.98% | ||
Held-to-maturity security in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 187 | ||
Proceeds from Sale, Maturity and Collection of Investments | $ 0 | ||
Debt and Equity Securities, Realized Gain (Loss) | $ 0 | ||
Debt Securities, Held-to-maturity, Transfer to Trading, Unrealized Gain (Loss) | 1,000,000 | ||
Preferred Stock | |||
Debt and Equity Securities, FV-NI [Line Items] | |||
Equity securities | $ 25,000,000 |
Investment Securities Debt Secu
Investment Securities Debt Securities, Trading Gains and Losses (Details) $ in Thousands | 12 Months Ended |
May 31, 2020USD ($) | |
Debt and Equity Securities, FV-NI [Line Items] | |
Trading Securities, Realized Gain (Loss) | $ 3,686 |
Debt Securities, Trading, Unrealized Gain (Loss) | 7,543 |
Net Realized and Unrealized Gain (Loss) on Trading Securities | $ 11,229 |
Loans Loans - Outstanding Princ
Loans Loans - Outstanding Principal Balance and Unadvanced Commitments (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | ||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | $ 26,690,854 | $ 25,905,664 | [1] | |
Deferred origination costs | 11,526 | 11,240 | [1] | |
Loans to members | 26,702,380 | 25,916,904 | [1] | |
Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 13,388,626 | 13,237,558 | |
CFC | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 25,607,657 | 24,817,676 | [1] | |
CFC | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 12,555,310 | 12,405,385 | |
CFC | Distribution | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 20,769,653 | 20,155,266 | [1] | |
CFC | Distribution | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 8,992,457 | 8,773,018 | |
CFC | Power supply | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 4,731,506 | 4,578,841 | [1] | |
CFC | Power supply | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 3,409,227 | 3,466,680 | |
CFC | Statewide and associate | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 106,498 | 83,569 | [1] | |
CFC | Statewide and associate | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 153,626 | 165,687 | |
NCSC | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 697,862 | 742,888 | [1] | |
NCSC | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 551,674 | 552,840 | |
RTFC | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 385,335 | 345,100 | [1] | |
RTFC | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 281,642 | 279,333 | |
Fixed rate | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 24,472,003 | 23,094,253 | [1] | |
Variable rate | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 655,704 | 1,066,880 | [1] | |
Variable rate | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | [1] | 5,458,676 | 5,448,636 | |
Long-term loans | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 25,127,707 | 24,161,133 | [1] | |
Long-term loans | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | 5,458,676 | 5,448,636 | [1] | |
Lines of credit | ||||
Recorded investment in loans: | ||||
Loans and Leases Receivable, Net of Deferred Income | 1,563,147 | 1,744,531 | [1] | |
Lines of credit | Unadvanced commitments | ||||
Recorded investment in loans: | ||||
Available Balance | $ 7,929,950 | $ 7,788,922 | [1] | |
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Loans Unadvanced Commitments -
Loans Unadvanced Commitments - Available Balance and Maturity (Details) - Unadvanced commitments - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Available Balance | [1] | $ 13,388,626 | $ 13,237,558 | |
2019 | 4,547,692 | |||
2020 | 1,978,283 | |||
2021 | 2,097,332 | |||
2022 | 2,635,063 | |||
2023 | 2,077,420 | |||
Thereafter | 52,836 | |||
Lines of credit | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Available Balance | 7,929,950 | 7,788,922 | [1] | |
2019 | 4,050,588 | |||
2020 | 613,528 | |||
2021 | 1,223,510 | |||
2022 | 961,034 | |||
2023 | 1,032,749 | |||
Thereafter | 48,541 | |||
Long-term loans | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Available Balance | 5,458,676 | $ 5,448,636 | [1] | |
2019 | 497,104 | |||
2020 | 1,364,755 | |||
2021 | 873,822 | |||
2022 | 1,674,029 | |||
2023 | 1,044,671 | |||
Thereafter | $ 4,295 | |||
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Loans Committed Lines of Credit
Loans Committed Lines of Credit - Available Balance and Maturity (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Unadvanced commitments | |||
Unadvanced Loan Commitments | |||
2019 | $ 4,547,692 | ||
2020 | 1,978,283 | ||
2021 | 2,097,332 | ||
2022 | 2,635,063 | ||
2023 | 2,077,420 | ||
Available Balance | [1] | 13,388,626 | $ 13,237,558 |
Unadvanced commitments not subject to material adverse change clauses | |||
Unadvanced Loan Commitments | |||
2019 | 115,815 | ||
2020 | 194,105 | ||
2021 | 970,366 | ||
2022 | 698,396 | ||
2023 | 878,347 | ||
Available Balance | $ 2,857,029 | $ 2,944,000 | |
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Loans Loans Outstanding Pledged
Loans Loans Outstanding Pledged as Collateral (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Pledging of Loans and Loans on Deposit | ||
Cash | $ 8,647 | $ 8,282 |
Collateral trust bonds 2007 indenture | ||
Pledging of Loans and Loans on Deposit | ||
Loans outstanding and pledged as collateral | 8,372,563 | 8,909,909 |
Debt outstanding | 7,422,711 | 7,622,711 |
Collateral trust bonds 1994 indenture | ||
Pledging of Loans and Loans on Deposit | ||
Debt outstanding | 35,000 | 40,000 |
Secured notes payable | Federal Agricultural Mortgage Corporation | ||
Pledging of Loans and Loans on Deposit | ||
Debt outstanding | 3,059,637 | 3,054,914 |
Clean Renewable Energy Bonds Series 2009A | ||
Pledging of Loans and Loans on Deposit | ||
Debt outstanding | 6,068 | 9,225 |
Cash | 395 | 415 |
Total pledged collateral | 7,664 | 10,764 |
Guaranteed Underwriter Program Notes Payable | ||
Pledging of Loans and Loans on Deposit | ||
Debt outstanding | 6,261,312 | 5,410,507 |
Mortgage notes | Distribution system mortgage notes | Collateral trust bonds 2007 indenture | ||
Pledging of Loans and Loans on Deposit | ||
Loans outstanding and pledged as collateral | 8,244,202 | 8,775,231 |
Mortgage notes | Distribution system mortgage notes | Collateral trust bonds 1994 indenture | ||
Pledging of Loans and Loans on Deposit | ||
Loans outstanding and pledged as collateral | 39,785 | 47,331 |
Mortgage notes | Distribution and power supply system mortgage notes | Federal Agricultural Mortgage Corporation | ||
Pledging of Loans and Loans on Deposit | ||
Loans outstanding and pledged as collateral | 3,687,418 | 3,751,798 |
Mortgage notes | Distribution and power supply system mortgage notes | Clean Renewable Energy Bonds Series 2009A | ||
Pledging of Loans and Loans on Deposit | ||
Loans outstanding and pledged as collateral | 7,269 | 10,349 |
RUS guaranteed loans qualifying as permitted investments | Collateral trust bonds 2007 indenture | ||
Pledging of Loans and Loans on Deposit | ||
Loans outstanding and pledged as collateral | 128,361 | 134,678 |
Mortgage Receivables on Deposit | Distribution and power supply system mortgage notes | Federal Financing Bank | ||
Pledging of Loans and Loans on Deposit | ||
Loans outstanding and pledged as collateral | $ 7,535,931 | $ 6,157,218 |
Loans Loans - Internal Risk Rat
Loans Loans - Internal Risk Rating (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Credit Quality | |||
Total recorded investment in loans | $ 26,690,854 | $ 25,905,664 | [1] |
CFC | |||
Credit Quality | |||
Total recorded investment in loans | 25,607,657 | 24,817,676 | [1] |
CFC | Distribution | |||
Credit Quality | |||
Total recorded investment in loans | 20,769,653 | 20,155,266 | [1] |
CFC | Power supply | |||
Credit Quality | |||
Total recorded investment in loans | 4,731,506 | 4,578,841 | [1] |
CFC | Statewide and associate | |||
Credit Quality | |||
Total recorded investment in loans | 106,498 | 83,569 | [1] |
NCSC | |||
Credit Quality | |||
Total recorded investment in loans | 697,862 | 742,888 | [1] |
RTFC | |||
Credit Quality | |||
Total recorded investment in loans | 385,335 | 345,100 | [1] |
Pass | |||
Credit Quality | |||
Total recorded investment in loans | 26,319,975 | 25,703,866 | |
Pass | CFC | |||
Credit Quality | |||
Total recorded investment in loans | 25,250,606 | 24,621,470 | |
Pass | CFC | Distribution | |||
Credit Quality | |||
Total recorded investment in loans | 20,643,737 | 20,022,193 | |
Pass | CFC | Power supply | |||
Credit Quality | |||
Total recorded investment in loans | 4,516,595 | 4,530,708 | |
Pass | CFC | Statewide and associate | |||
Credit Quality | |||
Total recorded investment in loans | 90,274 | 68,569 | |
Pass | NCSC | |||
Credit Quality | |||
Total recorded investment in loans | 697,862 | 742,888 | |
Pass | RTFC | |||
Credit Quality | |||
Total recorded investment in loans | 371,507 | 339,508 | |
Special Mention | |||
Credit Quality | |||
Total recorded investment in loans | 32,703 | 25,375 | |
Special Mention | CFC | |||
Credit Quality | |||
Total recorded investment in loans | 23,967 | 25,375 | |
Special Mention | CFC | Distribution | |||
Credit Quality | |||
Total recorded investment in loans | 7,743 | 10,375 | |
Special Mention | CFC | Statewide and associate | |||
Credit Quality | |||
Total recorded investment in loans | 16,224 | 15,000 | |
Special Mention | NCSC | |||
Credit Quality | |||
Total recorded investment in loans | 0 | 0 | |
Special Mention | RTFC | |||
Credit Quality | |||
Total recorded investment in loans | 8,736 | 0 | |
Substandard | |||
Credit Quality | |||
Total recorded investment in loans | 170,468 | 176,423 | |
Substandard | CFC | |||
Credit Quality | |||
Total recorded investment in loans | 165,376 | 170,831 | |
Substandard | CFC | Distribution | |||
Credit Quality | |||
Total recorded investment in loans | 118,173 | 122,698 | |
Substandard | CFC | Power supply | |||
Credit Quality | |||
Total recorded investment in loans | 47,203 | 48,133 | |
Substandard | RTFC | |||
Credit Quality | |||
Total recorded investment in loans | 5,092 | $ 5,592 | |
Doubtful [Member] | |||
Credit Quality | |||
Total recorded investment in loans | 167,708 | ||
Doubtful [Member] | CFC | |||
Credit Quality | |||
Total recorded investment in loans | 167,708 | ||
Doubtful [Member] | CFC | Power supply | |||
Credit Quality | |||
Total recorded investment in loans | $ 167,708 | ||
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Loans Loans - Payment Status (D
Loans Loans - Payment Status (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Payment Status of Loans | |||
Current | $ 26,690,854 | $ 25,905,664 | |
Past Due | 0 | 0 | |
Loans and Leases Receivable, Net of Deferred Income | 26,690,854 | 25,905,664 | [1] |
Non-accrual loans | $ 167,708 | $ 0 | |
As a % of total loans | |||
Current | 100.00% | 100.00% | |
30-89 days past due | 0.00% | 0.00% | |
90 days or more past due | 0.00% | 0.00% | |
Total past due | 0.00% | 0.00% | |
Total financing receivables | 100.00% | 100.00% | |
Non-accrual loans | 0.63% | 0.00% | |
CFC | |||
Payment Status of Loans | |||
Current | $ 25,607,657 | $ 24,817,676 | |
Past Due | 0 | 0 | |
Loans and Leases Receivable, Net of Deferred Income | 25,607,657 | 24,817,676 | [1] |
Non-accrual loans | 167,708 | 0 | |
CFC | Distribution | |||
Payment Status of Loans | |||
Current | 20,769,653 | 20,155,266 | |
Past Due | 0 | 0 | |
Loans and Leases Receivable, Net of Deferred Income | 20,769,653 | 20,155,266 | [1] |
Non-accrual loans | 0 | 0 | |
CFC | Power supply | |||
Payment Status of Loans | |||
Current | 4,731,506 | 4,578,841 | |
Past Due | 0 | 0 | |
Loans and Leases Receivable, Net of Deferred Income | 4,731,506 | 4,578,841 | [1] |
Non-accrual loans | 167,708 | 0 | |
CFC | Statewide and associate | |||
Payment Status of Loans | |||
Current | 106,498 | 83,569 | |
Loans and Leases Receivable, Net of Deferred Income | 106,498 | 83,569 | [1] |
NCSC | |||
Payment Status of Loans | |||
Current | 697,862 | 742,888 | |
Past Due | 0 | ||
Loans and Leases Receivable, Net of Deferred Income | 697,862 | 742,888 | [1] |
Non-accrual loans | 0 | 0 | |
RTFC | |||
Payment Status of Loans | |||
Current | 385,335 | 345,100 | |
Past Due | 0 | ||
Loans and Leases Receivable, Net of Deferred Income | 385,335 | 345,100 | [1] |
Non-accrual loans | 0 | 0 | |
30-89 Days Past Due | |||
Payment Status of Loans | |||
Past Due | 0 | 0 | |
30-89 Days Past Due | CFC | |||
Payment Status of Loans | |||
Past Due | 0 | 0 | |
30-89 Days Past Due | CFC | Distribution | |||
Payment Status of Loans | |||
Past Due | 0 | 0 | |
30-89 Days Past Due | NCSC | |||
Payment Status of Loans | |||
Past Due | 0 | ||
30-89 Days Past Due | RTFC | |||
Payment Status of Loans | |||
Past Due | 0 | ||
90 Days or More Past Due | |||
Payment Status of Loans | |||
Past Due | 0 | 0 | |
90 Days or More Past Due | CFC | |||
Payment Status of Loans | |||
Past Due | 0 | 0 | |
90 Days or More Past Due | CFC | Distribution | |||
Payment Status of Loans | |||
Past Due | 0 | 0 | |
90 Days or More Past Due | CFC | Power supply | |||
Payment Status of Loans | |||
Past Due | 0 | ||
90 Days or More Past Due | NCSC | |||
Payment Status of Loans | |||
Past Due | $ 0 | ||
90 Days or More Past Due | RTFC | |||
Payment Status of Loans | |||
Past Due | $ 0 | ||
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Loans Troubled Debt Restructure
Loans Troubled Debt Restructured Loans (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Loans and Leases Receivable Commercial, Net of Deferred Income, Percentage | 100.00% | 100.00% |
Performing TDR Loans | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Financing Receivable, Troubled Debt Restructuring | $ 10,847 | $ 11,853 |
Performing TDR Loans As Percentage of Total Loans | 0.04% | 0.05% |
TDR Financing Receivable | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Financing Receivable, Troubled Debt Restructuring | $ 10,847 | $ 11,853 |
Loans and Leases Receivable Commercial, Net of Deferred Income, Percentage | 0.04% | 0.05% |
CFC | Performing TDR Loans | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Financing Receivable, Troubled Debt Restructuring | $ 5,755 | $ 6,261 |
Performing TDR Loans As Percentage of Total Loans | 0.02% | 0.03% |
RTFC | Performing TDR Loans | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Financing Receivable, Troubled Debt Restructuring | $ 5,092 | $ 5,592 |
Performing TDR Loans As Percentage of Total Loans | 0.02% | 0.02% |
Loans Loans - Foregone Interest
Loans Loans - Foregone Interest Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Nonperforming TDR loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans and Leases Receivable, Impaired, Interest Lost on Nonaccrual Loans | $ 0 | $ 0 | $ 0 |
Loans Impaired Loans - Recorded
Loans Impaired Loans - Recorded Investment and Allowance (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Recorded investment in individually-impaired loans and the related specific valuation allowance | ||
Total impaired loans | $ 178,556 | $ 11,853 |
Related allowance | 34,833 | 1,021 |
CFC | ||
Impaired Loans | ||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | 5,756 | 6,261 |
RTFC | ||
Recorded investment in individually-impaired loans and the related specific valuation allowance | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 5,092 | 5,592 |
Related allowance | 979 | 1,021 |
Non-performing loans | RTFC | ||
Recorded investment in individually-impaired loans and the related specific valuation allowance | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 0 | |
Non-performing loans | Power Supply Systems [Member] | CFC | ||
Recorded investment in individually-impaired loans and the related specific valuation allowance | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 167,708 | $ 0 |
Related allowance | $ 33,854 |
Loans Impaired Loans - Average
Loans Impaired Loans - Average Recorded Investment and Interest Income Recognized (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Impaired Loans | |||
Total impaired loans | $ 17,195 | $ 12,183 | $ 12,885 |
Interest impaired loans | 836 | 846 | 889 |
CFC | |||
Impaired Loans | |||
Total impaired loans | 11,834 | 6,322 | 6,524 |
Interest impaired loans | 568 | 553 | 571 |
RTFC | |||
Impaired Loans | |||
Total impaired loans | 5,361 | 5,861 | 6,361 |
Interest impaired loans | $ 268 | $ 293 | $ 318 |
Loans Allowance for Loan Losses
Loans Allowance for Loan Losses Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Balance at the beginning of the period | $ 17,535 | $ 18,801 | $ 37,376 |
(Recovery of) provision for loan losses | 35,590 | (1,266) | (18,575) |
CFC | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Balance at the beginning of the period | 13,120 | 12,300 | 29,499 |
(Recovery of) provision for loan losses | 34,318 | 820 | (17,199) |
NCSC | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Balance at the beginning of the period | 2,007 | 2,082 | 2,910 |
(Recovery of) provision for loan losses | (1,201) | (75) | (828) |
RTFC | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Balance at the beginning of the period | 2,408 | 4,419 | 4,967 |
(Recovery of) provision for loan losses | $ (2,473) | $ 2,011 | $ 548 |
Loans Allowance for Loan Loss_2
Loans Allowance for Loan Losses Components and Related Loan Investments (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Ending balance of the allowance: | |||
Collective allowance | $ 18,292 | $ 16,514 | |
Asset-specific allowance | 34,833 | 1,021 | |
Recorded investment in loans: | |||
Collectively evaluated loans | 26,512,298 | 25,893,811 | |
Individually evaluated loans | 178,556 | 11,853 | |
Loans and Leases Receivable, Net of Deferred Income | 26,690,854 | 25,905,664 | [1] |
Loans and Leases Receivable, Net Amount | 26,637,729 | 25,888,129 | |
Deferred origination costs | 11,526 | 11,240 | [1] |
CFC | |||
Ending balance of the allowance: | |||
Collective allowance | 13,584 | 13,120 | |
Recorded investment in loans: | |||
Collectively evaluated loans | 25,434,193 | 24,811,415 | |
Individually evaluated loans | 173,464 | 6,261 | |
Loans and Leases Receivable, Net of Deferred Income | 25,607,657 | 24,817,676 | [1] |
Loans and Leases Receivable, Net Amount | 25,560,219 | 24,804,556 | |
NCSC | |||
Ending balance of the allowance: | |||
Collective allowance | 806 | 2,007 | |
Asset-specific allowance | 0 | 0 | |
Recorded investment in loans: | |||
Collectively evaluated loans | 697,862 | 742,888 | |
Individually evaluated loans | 0 | 0 | |
Loans and Leases Receivable, Net of Deferred Income | 697,862 | 742,888 | [1] |
Loans and Leases Receivable, Net Amount | 697,056 | 740,881 | |
RTFC | |||
Ending balance of the allowance: | |||
Collective allowance | 3,902 | 1,387 | |
Asset-specific allowance | 979 | 1,021 | |
Recorded investment in loans: | |||
Collectively evaluated loans | 380,243 | 339,508 | |
Individually evaluated loans | 5,092 | 5,592 | |
Loans and Leases Receivable, Net of Deferred Income | 385,335 | 345,100 | [1] |
Loans and Leases Receivable, Net Amount | $ 380,454 | $ 342,692 | |
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Loans Additional Information (D
Loans Additional Information (Details) | 12 Months Ended | ||||
May 31, 2020USD ($)memberpower_supply_systemdistribution_systemborrower | May 31, 2019USD ($)power_supply_systemdistribution_systemborrowerassociate | May 31, 2018USD ($) | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Number of Active Borrowers | member | 889 | ||||
Number of States with Active Borrowers | 49 | ||||
Unadvanced Line of Credit Commitments as Percentage of unadvanced loan commitments | 59.00% | ||||
Unadvanced Long-term Loans Commitments as Percentage of unadvanced loan commitments | 41.00% | ||||
Loans Receivable Cost of Loans Sold | $ 151,000,000 | $ 35,000,000 | $ 119,000,000 | ||
Loans and Leases Receivable, Net of Deferred Income | $ 26,690,854,000 | $ 25,905,664,000 | [1] | ||
Number of Borrowers With TDR Loans | 1 | 1 | |||
Financing Receivable, Troubled Debt Restructuring, Subsequent Default | $ 0 | $ 0 | 0 | ||
Accounts Receivable, Allowance for Credit Loss, Writeoff | $ 0 | 0 | 0 | ||
Minimum | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Term of Loans | 1 year | ||||
Maximum | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Term of Loans | 35 years | ||||
Nonperforming TDR loans | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 0 | ||||
Loans and Leases Receivable, Impaired, Interest Lost on Nonaccrual Loans | $ 0 | 0 | $ 0 | ||
Performing TDR Loans | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | 6,000,000 | ||||
Substandard | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 170,468,000 | 176,423,000 | |||
Doubtful [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 167,708,000 | ||||
CFC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 25,607,657,000 | 24,817,676,000 | [1] | ||
CFC | Distribution | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 20,769,653,000 | 20,155,266,000 | [1] | ||
CFC | Power supply | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 4,731,506,000 | 4,578,841,000 | [1] | ||
CFC | Non-performing loans | Power supply | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 167,708,000 | 0 | |||
CFC | Substandard | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 165,376,000 | 170,831,000 | |||
CFC | Substandard | Distribution | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 118,173,000 | 122,698,000 | |||
CFC | Substandard | Power supply | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 47,203,000 | 48,133,000 | |||
CFC | Doubtful [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 167,708,000 | ||||
CFC | Doubtful [Member] | Power supply | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 167,708,000 | ||||
RTFC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 385,335,000 | 345,100,000 | [1] | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 5,092,000 | 5,592,000 | |||
RTFC | Nonperforming TDR loans | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 0 | ||||
RTFC | Non-performing loans | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 0 | ||||
RTFC | Substandard | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 5,092,000 | 5,592,000 | |||
Unadvanced commitments | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | [1] | 13,388,626,000 | 13,237,558,000 | ||
Unadvanced commitments | CFC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | [1] | 12,555,310,000 | 12,405,385,000 | ||
Unadvanced commitments | CFC | Distribution | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | [1] | 8,992,457,000 | 8,773,018,000 | ||
Unadvanced commitments | CFC | Power supply | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | [1] | 3,409,227,000 | 3,466,680,000 | ||
Unadvanced commitments | RTFC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | [1] | 281,642,000 | 279,333,000 | ||
Commitments to Extend Credit Subject to Material Adverse Change Clause [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | 10,532,000,000 | 10,294,000,000 | |||
Unadvanced commitments not subject to material adverse change clauses | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | 2,857,029,000 | 2,944,000,000 | |||
Long-term loans | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 25,127,707,000 | 24,161,133,000 | [1] | ||
Long-term loans | Unadvanced commitments | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | $ 5,458,676,000 | $ 5,448,636,000 | [1] | ||
Loans outstanding | Geographic Concentration Risk | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Percentage of concentration | 16.00% | 15.00% | |||
Loans outstanding | Credit concentration | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Percentage of concentration | 2.00% | 2.00% | |||
Concentration Risk Number of Borrowers | borrower | 20 | 20 | |||
Loans outstanding | Credit concentration | Distribution | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Concentration Risk Number of Borrowers | distribution_system | 11 | 10 | |||
Loans outstanding | Credit concentration | Power supply | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Concentration Risk Number of Borrowers | power_supply_system | 9 | 9 | |||
Loans outstanding | Credit concentration | Associates | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Concentration Risk Number of Borrowers | associate | 1 | ||||
Loans outstanding | Customer Concentration Risk | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Percentage of concentration | 22.00% | 22.00% | |||
Loans outstanding | Product Concentration Risk | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Percentage of concentration | 99.00% | 99.00% | |||
Loans Guaranteed by Farmer Mac | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | $ 569,000,000 | $ 619,000,000 | |||
RUS guaranteed loans qualifying as permitted investments | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Loans and Leases Receivable, Net of Deferred Income | 147,000,000 | 154,000,000 | |||
Line of Credit Restricted for Fuel Purchases | Performing Line of Credit for Troubled Debt Restructuring Borrower [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | 6,000,000 | ||||
Loans and Leases Receivable, Net of Deferred Income | 1,000,000 | 3,000,000 | |||
Line of Credit to Provide Bridge Funding | Performing Line of Credit for Troubled Debt Restructuring Borrower [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Available Balance | 2,000,000 | 2,000,000 | |||
Loans and Leases Receivable, Net of Deferred Income | $ 2,000,000 | $ 1,000,000 | |||
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Allowance for Loan Losses - Sum
Allowance for Loan Losses - Summary of Changes in Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2020 | |
Loan Loss Allowance | ||||
Balance at the beginning of the period | $ 17,535 | $ 18,801 | $ 37,376 | |
Provision for Loan and Lease Losses | (35,590) | 1,266 | 18,575 | |
Total ending balance of the allowance | 17,535 | 18,801 | 37,376 | $ 53,125 |
CFC | ||||
Loan Loss Allowance | ||||
Balance at the beginning of the period | 13,120 | 12,300 | 29,499 | |
Provision for Loan and Lease Losses | (34,318) | (820) | 17,199 | |
Total ending balance of the allowance | 13,120 | 12,300 | 29,499 | 47,438 |
NCSC | ||||
Loan Loss Allowance | ||||
Balance at the beginning of the period | 2,007 | 2,082 | 2,910 | |
Provision for Loan and Lease Losses | 1,201 | 75 | 828 | |
Total ending balance of the allowance | 2,007 | 2,082 | 2,910 | 806 |
RTFC | ||||
Loan Loss Allowance | ||||
Balance at the beginning of the period | 2,408 | 4,419 | 4,967 | |
Provision for Loan and Lease Losses | 2,473 | (2,011) | (548) | |
Total ending balance of the allowance | $ 2,408 | $ 4,419 | $ 4,967 | $ 4,881 |
Allowance for Loan Losses - Rec
Allowance for Loan Losses - Recorded Investment (Details) - USD ($) number in Thousands, $ in Thousands | May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | |
Ending balance of the allowance: | |||||
Collective allowance | $ 18,292 | $ 16,514 | |||
Impaired Financing Receivable, Related Allowance | 34,833 | 1,021 | |||
Asset-specific allowance | 34,833 | 1,021 | |||
Total ending balance of the allowance | 53,125 | 17,535 | $ 18,801 | $ 37,376 | |
Recorded investment in loans: | |||||
Collectively evaluated loans | 26,512,298 | 25,893,811 | |||
Individually evaluated loans | 178,556 | 11,853 | |||
Total recorded investment in loans | 26,690,854 | 25,905,664 | [1] | ||
Loans and Leases Receivable, Net Amount | $ 26,637,729 | $ 25,888,129 | |||
Allowance Coverage Ratio | 0.00% | 0.00% | |||
Deferred origination costs | $ 11,526 | $ 11,240 | [1] | ||
CFC | |||||
Ending balance of the allowance: | |||||
Collective allowance | 13,584 | 13,120 | |||
Total ending balance of the allowance | 47,438 | 13,120 | 12,300 | 29,499 | |
Recorded investment in loans: | |||||
Collectively evaluated loans | 25,434,193 | 24,811,415 | |||
Individually evaluated loans | 173,464 | 6,261 | |||
Total recorded investment in loans | 25,607,657 | 24,817,676 | [1] | ||
Loans and Leases Receivable, Net Amount | $ 25,560,219 | $ 24,804,556 | |||
Allowance Coverage Ratio | 0.00% | 0.00% | |||
NCSC | |||||
Ending balance of the allowance: | |||||
Collective allowance | $ 806 | $ 2,007 | |||
Asset-specific allowance | 0 | 0 | |||
Total ending balance of the allowance | 806 | 2,007 | 2,082 | 2,910 | |
Recorded investment in loans: | |||||
Collectively evaluated loans | 697,862 | 742,888 | |||
Individually evaluated loans | 0 | 0 | |||
Total recorded investment in loans | 697,862 | 742,888 | [1] | ||
Loans and Leases Receivable, Net Amount | $ 697,056 | $ 740,881 | |||
Allowance Coverage Ratio | 0.00% | 0.00% | |||
RTFC | |||||
Ending balance of the allowance: | |||||
Collective allowance | $ 3,902 | $ 1,387 | |||
Impaired Financing Receivable, Related Allowance | 979 | 1,021 | |||
Asset-specific allowance | 979 | 1,021 | |||
Total ending balance of the allowance | 4,881 | 2,408 | $ 4,419 | $ 4,967 | |
Recorded investment in loans: | |||||
Collectively evaluated loans | 380,243 | 339,508 | |||
Individually evaluated loans | 5,092 | 5,592 | |||
Total recorded investment in loans | 385,335 | 345,100 | [1] | ||
Loans and Leases Receivable, Net Amount | $ 380,454 | $ 342,692 | |||
Allowance Coverage Ratio | 0.00% | 0.00% | |||
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Allowance for Loan Losses - Add
Allowance for Loan Losses - Additional Information (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Loan Loss Allowance | |||
Loans and Leases Receivable, Net of Deferred Income | $ 26,690,854 | $ 25,905,664 | [1] |
Impaired Financing Receivable, Related Allowance | 34,833 | 1,021 | |
Deferred origination costs | 11,526 | 11,240 | [1] |
Credit Reserve for Unadvanced Loan Commitments | 1,000 | 1,000 | |
Doubtful [Member] | |||
Loan Loss Allowance | |||
Loans and Leases Receivable, Net of Deferred Income | 167,708 | ||
Parent Company [Member] | |||
Loan Loss Allowance | |||
Loans and Leases Receivable, Net of Deferred Income | 25,607,657 | 24,817,676 | [1] |
Parent Company [Member] | Doubtful [Member] | |||
Loan Loss Allowance | |||
Loans and Leases Receivable, Net of Deferred Income | 167,708 | ||
Power Supply Systems [Member] | Parent Company [Member] | |||
Loan Loss Allowance | |||
Loans and Leases Receivable, Net of Deferred Income | 4,731,506 | 4,578,841 | [1] |
Power Supply Systems [Member] | Parent Company [Member] | Non-performing loans | |||
Loan Loss Allowance | |||
Impaired Financing Receivable, Related Allowance | 33,854 | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 167,708 | $ 0 | |
Power Supply Systems [Member] | Parent Company [Member] | Doubtful [Member] | |||
Loan Loss Allowance | |||
Loans and Leases Receivable, Net of Deferred Income | $ 167,708 | ||
[1] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Short-Term Borrowings Short-Ter
Short-Term Borrowings Short-Term Debt Outstanding and Weighted-Average Interest Rates (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Short-term Debt [Line Items] | ||
Short-term Debt | $ 3,961,985 | $ 3,607,726 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 0.62% | 2.56% |
Commercial paper sold through dealers, net of discounts | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 0 | $ 944,616 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 0.00% | 2.46% |
Commercial paper sold directly to members, at par | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 1,318,566 | $ 1,111,795 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 0.34% | 2.52% |
Commercial Paper [Member] | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 1,318,566 | $ 2,056,411 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 0.34% | 2.49% |
Select notes | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 1,597,959 | $ 1,023,952 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 0.75% | 2.70% |
Daily liquidity fund notes | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 508,618 | $ 298,817 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 0.10% | 2.25% |
Medium-term notes sold to members | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 286,842 | $ 228,546 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 1.64% | 2.87% |
Farmer Mac Notes Payable | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 250,000 | $ 0 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 1.06% | 0.00% |
Short-Term Borrowings Commitmen
Short-Term Borrowings Commitments under Revolving Credit Agreements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
May 31, 2020 | May 31, 2019 | |
Three Year Agreement | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,315,000 | |
Five Year Agreement | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 1,410,000 | |
Revolving credit agreements | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 2,725,000 | $ 2,975,000 |
Letters of Credit Outstanding, Amount | 3,000 | 3,000 |
Line of Credit Facility, Remaining Borrowing Capacity | 2,722,000 | 2,972,000 |
Revolving credit agreements | Three Year Agreement | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 1,315,000 | 1,440,000 |
Line of Credit Facility, Remaining Borrowing Capacity | $ 1,315,000 | $ 1,440,000 |
Debt Instrument, Maturity Date | Nov. 28, 2022 | Nov. 28, 2021 |
Line of Credit Facility, Commitment Fee Percentage | 0.075% | 0.075% |
Revolving credit agreements | Five Year Agreement | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,410,000 | $ 1,535,000 |
Letters of Credit Outstanding, Amount | 3,000 | 3,000 |
Line of Credit Facility, Remaining Borrowing Capacity | $ 1,407,000 | $ 1,532,000 |
Debt Instrument, Maturity Date | Nov. 28, 2023 | Nov. 28, 2023 |
Line of Credit Facility, Commitment Fee Percentage | 0.10% | 0.10% |
Short-Term Borrowings Additiona
Short-Term Borrowings Additional Information (Details) - USD ($) | 12 Months Ended | |
May 31, 2020 | May 31, 2019 | |
Short-term Debt [Line Items] | ||
Short-term Debt | $ 3,961,985,000 | $ 3,607,726,000 |
Short Term Debt as Percentage of Debt Outstanding | 15.00% | 14.00% |
Short-term borrowings | ||
Short-term Debt [Line Items] | ||
Term of debt | 1 year | |
Commercial paper | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 1,318,566,000 | $ 2,056,411,000 |
Select notes | ||
Short-term Debt [Line Items] | ||
Short-term Debt | 1,597,959,000 | 1,023,952,000 |
Three Year Agreement | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 1,315,000,000 | |
Line Of Credit Facility Terminated | 125,000,000 | |
Five Year Agreement | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 1,410,000,000 | |
Line Of Credit Facility Terminated | $ 125,000,000 | |
Minimum | Commercial paper | ||
Short-term Debt [Line Items] | ||
Term of debt | 1 day | |
Minimum | Select notes | ||
Short-term Debt [Line Items] | ||
Term of debt | 30 days | |
Maximum | Commercial paper | ||
Short-term Debt [Line Items] | ||
Term of debt | 270 days | |
Maximum | Select notes | ||
Short-term Debt [Line Items] | ||
Term of debt | 270 days | |
Revolving credit agreements | ||
Short-term Debt [Line Items] | ||
Short-term Debt | $ 0 | 0 |
Line of Credit Facility, Maximum Borrowing Capacity | 2,725,000,000 | $ 2,975,000,000 |
Letter of Credit Maximum Amount Available | $ 300,000,000 | |
Revolving credit agreements | Three Year Agreement | ||
Short-term Debt [Line Items] | ||
Debt Instrument, Maturity Date | Nov. 28, 2022 | Nov. 28, 2021 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,315,000,000 | $ 1,440,000,000 |
Revolving credit agreements | Five Year Agreement | ||
Short-term Debt [Line Items] | ||
Debt Instrument, Maturity Date | Nov. 28, 2023 | Nov. 28, 2023 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,410,000,000 | $ 1,535,000,000 |
CFC | Revolving credit agreements | ||
Short-term Debt [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,725,000,000 | $ 2,975,000,000 |
Long-Term Debt Long-Term Debt O
Long-Term Debt Long-Term Debt Outstanding and Weighted-Average Interest Rates (Details) - USD ($) $ in Thousands | 12 Months Ended | |
May 31, 2020 | May 31, 2019 | |
Debt Instrument [Line Items] | ||
Long-term Debt | $ 19,712,024 | $ 19,210,793 |
Weighted-Average Interest Rate | 2.92% | 3.20% |
Medium-term notes sold through dealers | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 3,086,733 | $ 2,962,375 |
Weighted-Average Interest Rate | 3.34% | 3.55% |
Medium-term notes sold to members | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 372,117 | $ 397,080 |
Weighted-Average Interest Rate | 2.85% | 3.03% |
Unsecured medium-term notes | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 3,458,850 | $ 3,359,455 |
Unamortized discount | (997) | (931) |
Unamortized Debt Issuance Expense | (16,943) | (19,399) |
Long-term Debt | $ 3,440,910 | $ 3,339,125 |
Weighted-Average Interest Rate | 3.29% | 3.49% |
Unsecured notes payable: | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 5,794 | $ 13,701 |
Unamortized discount | (107) | (187) |
Unamortized Debt Issuance Expense | $ (26) | $ (46) |
Weighted-Average Interest Rate | 0.00% | 3.97% |
Unsecured notes payable | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 5,661 | $ 13,468 |
Weighted-Average Interest Rate | ||
Unsecured long-term debt | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 3,446,571 | $ 3,352,593 |
Weighted-Average Interest Rate | 3.29% | 3.49% |
Collateral trust bonds | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 7,457,711 | $ 7,662,711 |
Unamortized discount | (236,461) | (244,643) |
Unamortized Debt Issuance Expense | (32,697) | (34,336) |
Long-term Debt | $ 7,188,553 | $ 7,383,732 |
Weighted-Average Interest Rate | 3.23% | 3.19% |
Guaranteed Underwriter Program Notes Payable | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 6,261,312 | $ 5,410,507 |
Long-term Debt | $ 6,261,312 | $ 5,410,507 |
Weighted-Average Interest Rate | 2.74% | 2.97% |
Farmer Mac notes payable | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 3,054,914 | |
Weighted-Average Interest Rate | 2.07% | 3.33% |
Other secured notes payable | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 6,068 | $ 9,225 |
Unamortized Debt Issuance Expense | (117) | (178) |
Long-term Debt | $ 5,951 | $ 9,047 |
Weighted-Average Interest Rate | 2.69% | 2.70% |
Debt Instrument, Maturity Date | Dec. 31, 2023 | Dec. 31, 2024 |
Secured notes payable | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 9,076,900 | $ 8,474,468 |
Weighted-Average Interest Rate | 2.53% | 3.10% |
Secured long-term debt | ||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 16,265,453 | $ 15,858,200 |
Weighted-Average Interest Rate | 2.85% | 3.14% |
Minimum | Medium-term notes sold through dealers | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2020 | Dec. 31, 2019 |
Minimum | Medium-term notes sold to members | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2020 | Dec. 31, 2019 |
Minimum | Unsecured notes payable: | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2023 | Dec. 31, 2022 |
Minimum | Collateral trust bonds | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2020 | Dec. 31, 2019 |
Minimum | Guaranteed Underwriter Program Notes Payable | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2025 | Dec. 31, 2025 |
Minimum | Farmer Mac notes payable | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2020 | Dec. 31, 2019 |
Maximum | Medium-term notes sold through dealers | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2032 | Dec. 31, 2032 |
Maximum | Medium-term notes sold to members | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2037 | Dec. 31, 2037 |
Maximum | Unsecured notes payable: | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2023 | |
Maximum | Collateral trust bonds | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2049 | Dec. 31, 2049 |
Maximum | Guaranteed Underwriter Program Notes Payable | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2040 | Dec. 31, 2039 |
Maximum | Farmer Mac notes payable | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Maturity Date | Dec. 31, 2049 | Dec. 31, 2049 |
Long-Term Debt Long-Term Debt M
Long-Term Debt Long-Term Debt Maturities (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Amount Maturing | ||
Long-term Debt | $ 19,712,024 | $ 19,210,793 |
Weighted-Average Interest Rate | ||
Total (as a percent) | 2.92% | 3.20% |
Long-Term Debt | ||
Amount Maturing | ||
2020 | $ 2,016,164 | |
2021 | 2,517,356 | |
2022 | 1,221,908 | |
2023 | 1,117,749 | |
2024 | 807,793 | |
Thereafter | 12,031,054 | |
Long-term Debt | $ 19,712,024 | |
Weighted-Average Interest Rate | ||
2020 (as a percent) | 2.41% | |
2021 (as a percent) | 2.12% | |
2022 (as a percent) | 2.33% | |
2023 (as a percent) | 3.00% | |
2024 (as a percent) | 2.77% | |
Thereafter (as a percent) | 3.24% | |
Total (as a percent) | 2.92% |
Long-Term Debt Additional Infor
Long-Term Debt Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
May 31, 2020 | May 31, 2019 | May 31, 2018 | Dec. 20, 2019 | |
Debt Instrument [Line Items] | ||||
Losses on early extinguishment of debt | $ (683) | $ (7,100) | $ 0 | |
Long-term Debt | $ 19,712,024 | 19,210,793 | ||
Maximum Percentage of Patronage Capital Distribution Allowed | 5.00% | |||
Proceeds from issuance of subordinated debt | $ 0 | 250,000 | $ 0 | |
1.75 Percent Medium-Term Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 1.75% | |||
Proceeds from issuance of subordinated debt | $ 500,000 | |||
2.30 Percent Collateral Trust Bonds [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 2.30% | |||
Repayments of Secured Debt | $ 300,000 | |||
2.00 Percent Collateral Trust Bonds [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 2.00% | |||
Repayments of Secured Debt | $ 400,000 | |||
2.40 Percent Collateral Trust Bonds [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 2.40% | |||
Proceeds from issuance of subordinated debt | $ 500,000 | |||
Secured notes payable | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | 9,076,900 | $ 8,474,468 | ||
Debt Instrument Fee Percentage | 0.30% | |||
Guaranteed Underwriter Program Notes Payable | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | $ 6,261,312 | $ 5,410,507 | ||
Debt Instrument Fee Percentage | 3.00% | |||
Additional Debt Instrument, Borrowing Capacity Available, Amount | $ 500,000 | |||
Debt Instrument, Unused Borrowing Capacity, Amount | 900,000 | |||
Long-term Debt | 6,261,312 | 5,410,507 | ||
Proceeds from issuance of subordinated debt | $ 950,000 | |||
Guaranteed Underwriter Program Series M Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Term of debt | 30 years | |||
Clean Renewable Energy Bonds Series 2009 A [Member] | ||||
Debt Instrument [Line Items] | ||||
Repayments of Secured Debt | $ 2,000 | |||
Unsecured notes payable: | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 9.07% | |||
Losses on early extinguishment of debt | $ (1,000) | |||
Long-term Debt | 5,794 | 13,701 | ||
Repayments of Unsecured Debt | 6,000 | |||
Federal Agricultural Mortgage Corporation | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument Maximum Borrowing Capacity | 5,500,000 | $ 5,500,000 | ||
Federal Agricultural Mortgage Corporation | First revolving note purchase agreement with FMAC | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | 2,810,000 | 3,055,000 | ||
Debt Instrument Maximum Borrowing Capacity | $ 5,200,000 | |||
Debt Instrument, Unused Borrowing Capacity, Amount | 2,440,000 | |||
Proceeds from issuance of subordinated debt | $ 250,000 | |||
Federal Agricultural Mortgage Corporation | Second revolving note purchase agreement with FMAC | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt | 0 | |||
Debt Instrument Maximum Borrowing Capacity | $ 300,000 |
Subordinated Deferrable Debt Ad
Subordinated Deferrable Debt Additional Information (Details) | 12 Months Ended | |
May 31, 2020 | May 31, 2019 | |
Subordinated Deferrable Debt | ||
Interest rate (as a percent) | 5.1125% | 5.11% |
Period after which debt can be called at par | 10 years | |
Debt Instrument, Period after which Debt can be Converted | 10 years | |
Maximum | ||
Subordinated Deferrable Debt | ||
Consecutive period for which interest payment can be deferred | 5 years | |
4.75 percent due 2043 | ||
Subordinated Deferrable Debt | ||
Interest rate (as a percent) | 4.75% | 4.75% |
5.25 Percent Due 2046 | ||
Subordinated Deferrable Debt | ||
Interest rate (as a percent) | 5.25% | 5.25% |
Subordinated Debt | Maximum | ||
Subordinated Deferrable Debt | ||
Term of debt | 30 years | |
5.50 Percent Due 2064 | ||
Subordinated Deferrable Debt | ||
Interest rate (as a percent) | 5.50% | 5.50% |
Period after which debt can be called at par | 5 years | |
5.50 Percent Due 2064 | Maximum | ||
Subordinated Deferrable Debt | ||
Term of debt | 45 years | |
Consecutive period for which interest payment can be deferred | 40 years |
Subordinated Deferrable Debt Su
Subordinated Deferrable Debt Subordinated Deferrable Debt Outstanding and Weighted-Average Interest Rates (Details) - USD ($) $ in Thousands | 12 Months Ended | |
May 31, 2020 | May 31, 2019 | |
Debt Instrument [Line Items] | ||
Subordinated Debt | $ 986,119 | $ 986,020 |
Interest rate (as a percent) | 5.1125% | 5.11% |
4.75 percent due 2043 | ||
Debt Instrument [Line Items] | ||
Subordinated Debt | $ 400,000 | $ 400,000 |
Interest rate (as a percent) | 4.75% | 4.75% |
Debt Instrument, Call Date, Earliest | Apr. 30, 2023 | Apr. 30, 2023 |
Debt Instrument, Maturity Date | Dec. 31, 2043 | Dec. 31, 2043 |
5.25 Percent Due 2046 | ||
Debt Instrument [Line Items] | ||
Subordinated Debt | $ 350,000 | $ 350,000 |
Interest rate (as a percent) | 5.25% | 5.25% |
Debt Instrument, Call Date, Earliest | Apr. 20, 2026 | Apr. 20, 2026 |
Debt Instrument, Maturity Date | Dec. 31, 2046 | Dec. 31, 2046 |
5.50 Percent Due 2064 | ||
Debt Instrument [Line Items] | ||
Subordinated Debt | $ 250,000 | $ 250,000 |
Interest rate (as a percent) | 5.50% | 5.50% |
Debt Instrument, Call Date, Earliest | May 15, 2024 | May 15, 2024 |
Debt Instrument, Maturity Date | Dec. 31, 2064 | Dec. 31, 2064 |
Subordinated Debt | ||
Debt Instrument [Line Items] | ||
Unamortized Debt Issuance Expense | $ (13,881) | $ (13,980) |
Members' Subordinated Certifi_3
Members' Subordinated Certificates Outstanding and Weighted-Average Interest Rates (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | ||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 986,119 | $ 986,020 | |
Weighted-Average Interest Rate (as a percent) | 2.92% | 3.20% | |
Subordinated certificates | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 1,339,618 | $ 1,357,129 | |
Weighted-Average Interest Rate (as a percent) | 4.22% | 4.21% | |
Certificates maturing 2020 through 2119 | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 630,467 | $ 630,466 | |
Subscribed and unissued (1) | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | [1] | 16 | 8 |
Total membership subordinated certificates | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 630,483 | $ 630,474 | |
Weighted-Average Interest Rate (as a percent) | 4.95% | 4.95% | |
Interest-bearing loan subordinated certificates maturing through 2045 | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 280,372 | $ 290,259 | |
Debt Instrument, Maturity Date | Dec. 31, 2045 | ||
Non-interest-bearing loan subordinated certificates maturing through 2047 | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 144,258 | 150,152 | |
Debt Instrument, Maturity Date | Dec. 31, 2047 | ||
Subscribed and unissued (1) | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | [1] | $ 45 | 45 |
Loan Subordinated Certificates | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 424,675 | $ 440,456 | |
Weighted-Average Interest Rate (as a percent) | 2.71% | 2.73% | |
Interest Bearing Guarantee Subordinated Certificates | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 43,700 | $ 47,878 | |
Debt Instrument, Maturity Date | Dec. 31, 2044 | ||
Non Interest Bearing Guarantee Subordinated Certificates | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 14,590 | 17,151 | |
Debt Instrument, Maturity Date | Dec. 31, 2037 | ||
Guarantee Subordinated Certificates | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 58,290 | $ 65,029 | |
Weighted-Average Interest Rate (as a percent) | 4.43% | 4.49% | |
Loan and guarantee subordinated certificates | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 482,965 | $ 505,485 | |
Weighted-Average Interest Rate (as a percent) | 2.92% | 2.95% | |
Member capital securities | |||
Subordinated Deferrable Debt | |||
Subordinated deferrable debt | $ 226,170 | $ 221,170 | |
Weighted-Average Interest Rate (as a percent) | 5.00% | 5.00% | |
Debt Instrument, Maturity Date | Dec. 31, 2050 | ||
Minimum | Total membership subordinated certificates | |||
Subordinated Deferrable Debt | |||
Debt Instrument, Maturity Date | Dec. 31, 2020 | ||
Maximum | Total membership subordinated certificates | |||
Subordinated Deferrable Debt | |||
Debt Instrument, Maturity Date | Dec. 31, 2119 | ||
[1] | The subscribed and unissued subordinated certificates represent subordinated certificates that members are required to purchase. Upon collection of full payment of the subordinated certificate amount, the certificate will be reclassified from subscribed and unissued to outstanding. |
Members' Subordinated Certifi_4
Members' Subordinated Certificates Maturities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | ||
Amount Maturing | |||
Total long-term debt | $ 986,119 | $ 986,020 | |
Members' Certificates, exclusive of certificates amortized annually | |||
Amount Maturing | |||
2020 | [1] | 40,511 | |
2021 | [1] | 13,339 | |
2023 | [1] | 15,240 | |
2024 | [1] | 24,212 | |
Thereafter | [1] | 1,223,934 | |
Total long-term debt | [1] | $ 1,339,557 | |
Weighted-Average Interest Rate | |||
2020 (as a percent) | 3.60% | ||
2021 (as a percent) | 3.07% | ||
Long-Term Debt, Maturity, Year Three | [1] | $ 22,321 | |
2022 (as a percent) | 3.70% | ||
2023 (as a percent) | 2.37% | ||
2024 (as a percent) | 1.66% | ||
Thereafter (as a percent) | 4.34% | ||
Total (as a percent) | 4.22% | ||
Loan Subordinated Certificates | |||
Amount Maturing | |||
Total long-term debt | $ 424,675 | $ 440,456 | |
Other information | |||
Payments not received on certificates subscribed and unissued | 0 | ||
Average amortization of debt | $ 14,000 | ||
Amortization as a percentage of amortizing loan subordinated debt outstanding | 6.00% | ||
Amortizing Member Loan Subordinated Certificates | |||
Amount Maturing | |||
Total long-term debt | $ 239,000 | ||
[1] | Amortization payments on these certificates totaled $14 million in fiscal year 2020 and represented 6% of amortizing loan subordinated certificates outstanding. |
Members' Subordinated Certifi_5
Members' Subordinated Certificates Additional Information (Details) | 12 Months Ended | |
May 31, 2020 | May 31, 2019 | |
Members' subordinated certificates | ||
Interest rate (as a percent) | 5.1125% | 5.11% |
Membership subordinated certificates | ||
Members' subordinated certificates | ||
Maturity period | 100 years | |
Interest rate (as a percent) | 5.00% | |
Member capital securities | ||
Members' subordinated certificates | ||
Maturity period | 30 years | |
Interest rate (as a percent) | 5.00% | |
Series 2013 Member Capital Securities | ||
Members' subordinated certificates | ||
Member capital security, call option term | 10 years | |
Weighted Average | Membership subordinated certificates | ||
Members' subordinated certificates | ||
Maturity period | 56 years | 57 years |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities Derivatives Notional Amounts and Weighted-Average Rate (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Pay Fixed Receive Variable Swaps | ||
Derivative [Line Items] | ||
Derivative, Average Variable Interest Rate | 0.88% | 2.60% |
Derivative, Average Fixed Interest Rate | 2.78% | 2.83% |
Pay Variable Receive Fixed Swaps | ||
Derivative [Line Items] | ||
Derivative, Average Variable Interest Rate | 1.54% | 3.25% |
Derivative, Average Fixed Interest Rate | 2.75% | 2.56% |
Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative Weighted Average Interest Rate Paid Percentage | 2.42% | 2.97% |
Derivative Weighted Average Interest Rate Received Percentage | 1.42% | 2.58% |
Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | $ 9,306,808 | $ 10,843,280 |
Not Designated as Hedging Instrument | Pay Fixed Receive Variable Swaps | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | 6,604,808 | 7,379,280 |
Not Designated as Hedging Instrument | Pay Variable Receive Fixed Swaps | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | 2,699,000 | 3,399,000 |
Not Designated as Hedging Instrument | Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | 9,303,808 | 10,778,280 |
Not Designated as Hedging Instrument | Forward Contracts | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | $ 3,000 | $ 65,000 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities Derivatives Notional Amount Maturities (Details) - Not Designated as Hedging Instrument - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Derivative [Line Items] | ||
Derivative, Notional Amount | $ 9,306,808 | $ 10,843,280 |
Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | 9,303,808 | $ 10,778,280 |
Derivative Notional Amount Maturing in one year | 466,602 | |
Derivative Notional Amount Maturing in two years | 749,854 | |
Derivative Notional Amount Maturing in three years | 323,082 | |
Derivative Notional Amount Maturing in four years | 655,899 | |
Derivative Notional Amount Maturing in five years | 100,000 | |
Derivative Notional Amount Maturing in more than five years | $ 7,011,371 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities Derivatives - Balance Sheet Impact (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Derivative [Line Items] | ||
Derivative liabilities | $ 1,258,459 | $ 391,724 |
Derivative Asset, Notional Amount | 2,699,000 | 2,332,104 |
Derivative assets | 173,195 | 41,179 |
Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative Liability, Notional Amount | 6,607,808 | 8,511,176 |
Derivative liabilities | $ 1,258,459 | $ 391,724 |
Derivative Instruments and He_6
Derivative Instruments and Hedging Activities Derivatives Offsetting (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Derivative [Line Items] | ||
Derivative assets | $ 173,195 | $ 41,179 |
Derivative liabilities | 1,258,459 | 391,724 |
Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative Asset, Fair Value, Gross Liability | 0 | 0 |
Derivative Asset, Fair Value, Amount Not Offset Against Collateral | 173,195 | 41,179 |
Derivative, Collateral, Obligation to Return Securities | 173,195 | 41,176 |
Derivative, Collateral, Obligation to Return Cash | 0 | 0 |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 0 | 3 |
Derivative liabilities | 1,258,459 | 391,724 |
Derivative Liability, Fair Value, Gross Asset | 0 | 0 |
Derivative Liability, Fair Value, Amount Not Offset Against Collateral | 1,258,459 | 391,724 |
Derivative, Collateral, Right to Reclaim Securities | 173,195 | 41,176 |
Derivative, Collateral, Right to Reclaim Cash | 0 | 0 |
Derivative Liability, Fair Value, Amount Offset Against Collateral | $ 1,085,264 | $ 350,548 |
Derivative Instruments and He_7
Derivative Instruments and Hedging Activities Derivatives - Income Statement Impact (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Gain (Loss) on Sale of Derivatives | $ (55,873) | $ (43,611) | $ (74,281) |
Unrealized Gain (Loss) on Derivatives | (734,278) | (319,730) | 306,002 |
Derivative gains (losses) | $ (790,151) | $ (363,341) | $ 231,721 |
Derivative Instruments and He_8
Derivative Instruments and Hedging Activities Derivatives - Rating Triggers (Details) - Counterparty Group - Interest rate swaps $ in Thousands | May 31, 2020USD ($) | |
Derivative [Line Items] | ||
Assets Needed for Immediate Settlement, Aggregate Fair Value | $ 753,150 | |
Assets Received for Immediate Settlement Aggregate Fair Value | 0 | |
Net Asset Needed for Immediate Settlement Aggregate Fair Value | (753,150) | |
Derivative, Notional Amount | 6,603,641 | |
Moodys A3 Rating Standard Poors A Minus Rating | Minimum | ||
Derivative [Line Items] | ||
Assets Needed for Immediate Settlement, Aggregate Fair Value | 11,305 | |
Assets Received for Immediate Settlement Aggregate Fair Value | 0 | [1] |
Net Asset Needed for Immediate Settlement Aggregate Fair Value | (11,305) | [1] |
Derivative, Notional Amount | 45,860 | [1] |
Moodys Baa 1 Rating Standard Poor's BBB Plus Rating | Minimum | ||
Derivative [Line Items] | ||
Assets Needed for Immediate Settlement, Aggregate Fair Value | 692,210 | |
Assets Received for Immediate Settlement Aggregate Fair Value | 0 | |
Net Asset Needed for Immediate Settlement Aggregate Fair Value | (692,210) | |
Derivative, Notional Amount | 6,091,198 | |
Moody's Baa 2 Rating Standard Poor's BBB Rating | Minimum | ||
Derivative [Line Items] | ||
Assets Needed for Immediate Settlement, Aggregate Fair Value | 33,958 | [2] |
Assets Received for Immediate Settlement Aggregate Fair Value | 0 | [2] |
Net Asset Needed for Immediate Settlement Aggregate Fair Value | (33,958) | [2] |
Derivative, Notional Amount | 421,303 | [2] |
Moodys Baa 3 Rating Standard Poor's BBB- Plus Rating | Minimum | ||
Derivative [Line Items] | ||
Assets Needed for Immediate Settlement, Aggregate Fair Value | 15,677 | |
Net Asset Needed for Immediate Settlement Aggregate Fair Value | (15,677) | |
Derivative, Notional Amount | $ 45,280 | |
[1] | Rating trigger for CFC falls below A3/A-, while rating trigger for counterparty falls below Baa1/BBB+ by Moody’s or S&P, respectively. | |
[2] | Rating trigger for CFC falls to or below Baa2/BBB, while rating trigger for counterparty falls to or below Ba2/BB+ by Moody’s or S&P, respectively. |
Derivative Instruments and He_9
Derivative Instruments and Hedging Activities Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
May 31, 2020 | May 31, 2019 | May 31, 2018 | ||
Derivative [Line Items] | ||||
Long-term Debt | $ 19,712,024 | $ 19,210,793 | ||
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | $ 1,000 | |||
Gain on Cash Flow Hedge Ineffectiveness | 1,000 | 1,000 | ||
Interest Rate Swaps with CFC Rating Trigger and Treasury Lock [Member] | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | [1] | 166,000 | ||
Assets Needed for Immediate Settlement, Aggregate Fair Value | 62,000 | |||
Interest rate swaps | ||||
Derivative [Line Items] | ||||
Derivative Liability, Notional Amount | 6,607,808 | $ 8,511,176 | ||
Derivative, Net Liability Position, Aggregate Fair Value | $ 798,000 | |||
Percentage of concentration | 25.00% | 23.00% | ||
Guaranteed Underwriter Program Notes Payable | ||||
Derivative [Line Items] | ||||
Long-term Debt | $ 6,261,312 | $ 5,410,507 | ||
Designated as Hedging Instrument | Treasury Lock | ||||
Derivative [Line Items] | ||||
Derivative Liability, Notional Amount | 100,000 | |||
Designated as Hedging Instrument | Guaranteed Underwriter Program Notes Payable | ||||
Derivative [Line Items] | ||||
Long-term Debt | $ 100,000 | |||
[1] | Rating trigger for CFC falls below A3/A-, while rating trigger for counterparty falls below Baa1/BBB+ by Moody’s or S&P, respectively. |
Equity Equity Components (Detai
Equity Equity Components (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | ||
Components of equity | |||||
Prior years cumulative derivative forward value and foreign currency adjustments | $ (348,965) | $ (30,831) | |||
Unrealized Gain (Loss) on Derivatives | (734,278) | (319,730) | $ 306,002 | ||
Total Cumulative Derivative Forward Value and Foreign Currency Adjustments | (1,079,739) | (348,965) | |||
Retained equity | 628,031 | 1,276,882 | |||
Accumulated other comprehensive income | (1,910) | (147) | 8,544 | ||
Total CFC equity | 626,121 | 1,276,735 | |||
Noncontrolling interests | 22,701 | 27,147 | |||
Total equity | 648,822 | 1,303,882 | 1,505,853 | $ 1,098,805 | |
Membership fees | |||||
Components of equity | |||||
Total members' equity | 969 | 969 | |||
Education fund | |||||
Components of equity | |||||
Total members' equity | 2,224 | 2,013 | |||
Retained Earnings, Appropriated Membership Fees and Education Fund [Member] | |||||
Components of equity | |||||
Total members' equity | 3,193 | 2,982 | |||
Total equity | 3,193 | 2,982 | 2,945 | 2,900 | |
Members' capital reserve | |||||
Components of equity | |||||
Total members' equity | 894,066 | 860,578 | |||
Total equity | 807,320 | 759,097 | 687,785 | 630,305 | |
Allocated net income | |||||
Components of equity | |||||
Total members' equity | 807,320 | 759,097 | |||
Total equity | 894,066 | 860,578 | 811,493 | 761,701 | |
Unallocated net income (loss) | |||||
Components of equity | |||||
Total members' equity | 3,191 | 3,190 | |||
Unallocated Net Income (Loss) | |||||
Components of equity | |||||
Total equity | (1,076,548) | (345,775) | $ (36,434) | $ (338,128) | |
CFC | |||||
Components of equity | |||||
Unrealized Gain (Loss) on Derivatives | [1] | $ 730,774 | $ 318,134 | ||
[1] | Represents derivative forward value gains (losses) for CFC only, as total CFC equity does not include the noncontrolling interests of the consolidated variable interest entities NCSC and RTFC. See “Note 15—Business Segments” for the statements of operations for CFC. |
Equity Accumulated Other Compre
Equity Accumulated Other Comprehensive Income Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Beginning balance | $ (147) | $ 8,544 | |
Unrealized losses on equity securities | 0 | 0 | $ (3,222) |
Unrealized gains (losses) on cash flow hedges | 0 | 1,059 | (1,059) |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, before Tax | 1,322 | 488 | (313) |
Other Comprehensive Income (Loss), Unrealized Gains (Losses) | 1,059 | ||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (1,322) | (488) | |
Other Comprehensive Income Loss Reclassification Adjustment From AOCI Foreclosed Asset | (441) | (468) | |
Other comprehensive income | (1,763) | 103 | |
Ending balance | (1,910) | (147) | 8,544 |
Accounting Standards Update 2016-01 [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Beginning balance | (8,794) | ||
Ending balance | (8,794) | ||
Unrealized Gains (Losses) Equity Securities | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Beginning balance | 0 | 8,794 | |
Unrealized losses on equity securities | 0 | ||
Other comprehensive income | 0 | 0 | |
Ending balance | 0 | 0 | 8,794 |
Unrealized Gains (Losses) Equity Securities | Accounting Standards Update 2016-01 [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Beginning balance | (8,794) | ||
Ending balance | (8,794) | ||
Unrealized Gains Derivatives(1) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Beginning balance | 2,571 | 3,039 | |
Other Comprehensive Income (Loss), Derivative, Excluded Component, Increase (Decrease), Adjustments, after Tax | (441) | (468) | |
Other comprehensive income | (441) | (468) | |
Ending balance | 2,130 | 2,571 | 3,039 |
Unrealized Gains (Losses) Cash Flow Hedges | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Beginning balance | 0 | (1,059) | |
Unrealized gains (losses) on cash flow hedges | 1,059 | ||
Other Comprehensive Income (Loss), Net Investment Hedge, Gain (Loss), Reclassification, before Tax | 0 | 0 | |
Other comprehensive income | 0 | 1,059 | |
Ending balance | 0 | 0 | (1,059) |
Unrealized Losses Defined Benefit Plan(2) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Beginning balance | (2,718) | (2,230) | |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (1,322) | (488) | |
Other comprehensive income | (1,322) | (488) | |
Ending balance | $ (4,040) | $ (2,718) | $ (2,230) |
Equity Additional Information (
Equity Additional Information (Details) $ in Thousands | 2 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jul. 31, 2020USD ($) | Jul. 31, 2019USD ($) | Nov. 30, 2020USD ($) | May 31, 2020USD ($)reserve | May 31, 2019USD ($) | May 31, 2018USD ($) | May 31, 2017USD ($) | |
Equity | |||||||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, after Tax | $ 0 | $ 1,059 | $ (1,059) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (1,910) | (147) | 8,544 | ||||
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax | 0 | 0 | (3,222) | ||||
Other Comprehensive Income (Loss), Unrealized Gains (Losses) | 1,059 | ||||||
Other Comprehensive Income Loss Reclassification Adjustment From AOCI Foreclosed Asset | (441) | (468) | |||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (1,322) | (488) | |||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (1,763) | 103 | |||||
Stockholders' Equity, Period Increase (Decrease) | (655,000) | ||||||
Total equity | 648,822 | 1,303,882 | 1,505,853 | $ 1,098,805 | |||
Net income (loss) | (589,430) | (151,210) | 457,364 | ||||
Other Comprehensive Income (Loss), Net of Tax | (1,763) | 103 | (4,631) | ||||
Retirement/allocation of net earnings authorized | $ (64,755) | (50,415) | (45,220) | ||||
Minimum percentage of paid-in-capital required to be maintained under District of Columbia cooperative law | 50.00% | ||||||
Accumulated other comprehensive income expected to be reclassified into earnings over the next 12 months | $ 1,000 | ||||||
Multiemployer Plan, Employer Contribution, Cost | 5,000 | 5,000 | 5,000 | ||||
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent [Member] | |||||||
Equity | |||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 0 | 0 | 8,794 | ||||
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax | 0 | ||||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 0 | 0 | |||||
AOCI, Derivative Qualifying as Hedge, Excluded Component, Parent [Member] | |||||||
Equity | |||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 2,130 | 2,571 | 3,039 | ||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax | (441) | (468) | |||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (441) | (468) | |||||
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent [Member] | |||||||
Equity | |||||||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, before Tax | 0 | 0 | |||||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, after Tax | 1,059 | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 0 | 0 | (1,059) | ||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 0 | 1,059 | |||||
Noncontrolling Interest [Member] | |||||||
Equity | |||||||
Total equity | 22,701 | 27,147 | 31,520 | 28,852 | |||
Net income (loss) | (4,190) | (1,979) | 2,178 | ||||
Retirement/allocation of net earnings authorized | (1,933) | (2,908) | |||||
Accumulated Defined Benefit Plans Adjustment, Net Transition Attributable to Parent [Member] | |||||||
Equity | |||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (4,040) | (2,718) | (2,230) | ||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (1,322) | (488) | |||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (1,322) | (488) | |||||
Patronage Capital Allocated | |||||||
Equity | |||||||
Total equity | 894,066 | 860,578 | 811,493 | 761,701 | |||
Net income (loss) | 96,310 | 96,592 | 95,012 | ||||
Retirement/allocation of net earnings authorized | (62,822) | (47,507) | (45,220) | ||||
Members' capital reserve | |||||||
Equity | |||||||
Total equity | 807,320 | 759,097 | 687,785 | 630,305 | |||
Net income (loss) | 48,223 | 71,312 | 57,480 | ||||
Retained Earnings, Appropriated Membership Fees and Education Fund [Member] | |||||||
Equity | |||||||
Total equity | 3,193 | 2,982 | 2,945 | $ 2,900 | |||
Net income (loss) | $ 1,000 | 1,000 | $ 1,000 | ||||
CFC | |||||||
Equity | |||||||
General reserve required to be maintained as a percentage of membership fees collected | 50.00% | ||||||
Number of additional board-approved reserves | reserve | 1 | ||||||
CFC | Cooperative educational fund | Minimum | |||||||
Equity | |||||||
Minimum percentage of net earnings to be allocated to cooperative education fund as per bylaws of the entity | 0.25% | ||||||
CFC | Patronage Capital Allocated | |||||||
Equity | |||||||
Retirement/allocation of net earnings authorized | $ 63,000 | ||||||
Percentage of prior year's allocated patronage capital required to be retired | 50.00% | ||||||
Percentage of prior year's allocated patronage capital required to be held | 50.00% | ||||||
Period for which prior year's allocated patronage capital is required to be held | 25 years | ||||||
Retirement of allocated net earnings, percentage | 50.00% | ||||||
CFC | Retained Earnings Allocation of Fifty Percent of Prior Year Patronage Capital Allocation [Member] | |||||||
Equity | |||||||
Retirement/allocation of net earnings authorized | $ (48,000) | ||||||
CFC | Retained earnings prior year allocation held for 25 years | |||||||
Equity | |||||||
Retirement/allocation of net earnings authorized | $ (15,000) | ||||||
RTFC | |||||||
Equity | |||||||
Minimum percentage of paid-in-capital required to be maintained under District of Columbia cooperative law | 50.00% | ||||||
RTFC | Minimum | |||||||
Equity | |||||||
Percentage of retirement of allocated net earnings in cash | 20.00% | ||||||
RTFC | Cooperative educational fund | Minimum | |||||||
Equity | |||||||
Minimum percentage of net earnings to be allocated to cooperative education fund as per bylaws of the entity | 1.00% | ||||||
NCSC | |||||||
Equity | |||||||
Minimum percentage of paid-in-capital required to be maintained under District of Columbia cooperative law | 50.00% | ||||||
NCSC | Cooperative educational fund | Minimum | |||||||
Equity | |||||||
Minimum percentage of net earnings to be allocated to cooperative education fund as per bylaws of the entity | 0.25% | ||||||
Subsequent Event | |||||||
Equity | |||||||
Retirement/allocation of net earnings authorized | $ (60,000) | ||||||
Subsequent Event | Patronage Capital Allocated | |||||||
Equity | |||||||
Retirement/allocation of net earnings authorized | $ (48,000) | ||||||
Subsequent Event | Retained earnings prior year allocation held for 25 years | |||||||
Equity | |||||||
Retirement/allocation of net earnings authorized | $ (12,000) | ||||||
RTFC | |||||||
Equity | |||||||
Percentage of ownership by minority owners | 100.00% | ||||||
NCSC | |||||||
Equity | |||||||
Percentage of ownership by parent | 100.00% |
Employee Benefits Additional In
Employee Benefits Additional Information (Details) | 12 Months Ended | |||||
May 31, 2020USD ($)salary | May 31, 2019USD ($) | May 31, 2018USD ($) | Jan. 01, 2020 | Jan. 01, 2019 | Jan. 01, 2018 | |
Defined benefit multiemployer master pension plan | ||||||
Multiemployer plans requisite service period | 1 year | |||||
Percentage of joint and surviving spouse annuity | 50.00% | |||||
Annuity factor (as a percent) | 1.70% | |||||
Number of highest base salaries | salary | 5 | |||||
Liability, Defined Benefit Pension Plan | $ 7,000,000 | $ 6,000,000 | ||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (1,322,000) | (488,000) | ||||
Expected Reclassification from Accumulated Other Comprehensive Income over Next Twelve Months Net of Tax | 1,000,000 | |||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Gain (Loss) Due to Settlement and Curtailment | 1,000,000 | |||||
Defined Benefit Plan, Benefit Obligation, Payment for Settlement | 2,000,000 | |||||
Contributions made by CFC | 5,000,000 | 5,000,000 | $ 5,000,000 | |||
Limit on the compensation to be used in the calculation of pension benefits | 285,000 | |||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, before Tax | $ 1,322,000 | 488,000 | (313,000) | |||
401(k) defined contribution savings program | ||||||
Number of consecutive months considered for eligible period of service | 12 months | |||||
Maximum matching contributions by CFC as a percentage of employee's salary | 2.00% | |||||
Minimum employee contribution (as a percent) | 2.00% | |||||
Contributions made by CFC | $ 1,000,000 | 1,000,000 | 1,000,000 | |||
Accumulated other comprehensive income | $ (1,910,000) | $ (147,000) | $ 8,544,000 | |||
Minimum | ||||||
Defined benefit multiemployer master pension plan | ||||||
Funded status, more than 80% (as a percent) | 80.00% | 80.00% | 80.00% | |||
401(k) defined contribution savings program | ||||||
Defined Contribution Plan, Requisite Service Period | 1000 hours | |||||
Maximum | ||||||
Defined benefit multiemployer master pension plan | ||||||
Contributions made by CFC as a percentage of total contributions by all participating employers | 5.00% | 5.00% | 5.00% | |||
Pension Restoration Plan | ||||||
Defined benefit multiemployer master pension plan | ||||||
Defined Contribution Plan, Number of Employees | 2 | |||||
Executive Benefit Restoration Plan | ||||||
Defined benefit multiemployer master pension plan | ||||||
Pension expense | $ 2,000,000 | $ 1,000,000 | $ 1,000,000 | |||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | 4,000,000 | |||||
Expected Reclassification from Accumulated Other Comprehensive Income over Next Twelve Months Net of Tax | $ 1,000,000 | |||||
Defined Benefit Plan, Number of Employees Vested | 0 | |||||
Defined Benefit Plan, Number of Employees | 7 | |||||
Unrealized Losses Defined Benefit Plan(2) | ||||||
Defined benefit multiemployer master pension plan | ||||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | $ (1,322,000) | (488,000) | ||||
401(k) defined contribution savings program | ||||||
Accumulated other comprehensive income | $ (4,040,000) | $ (2,718,000) | $ (2,230,000) |
Guarantees Guarantees Outstandi
Guarantees Guarantees Outstanding (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 | |
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | $ 820,786 | $ 837,435 | |
Long-term tax-exempt bonds | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | [1] | 263,875 | 312,190 |
Letters of credit | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | [2] | 413,839 | 379,001 |
Other guarantees | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 143,072 | 146,244 | |
CFC | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 810,787 | 827,344 | |
CFC | Distribution | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 266,301 | 235,919 | |
CFC | Power supply | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 538,532 | 586,717 | |
CFC | Statewide and associate | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 5,954 | 4,708 | |
NCSC | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 0 | 1,574 | |
RTFC | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | $ 9,999 | $ 8,517 | |
[1] | Represents the outstanding principal amount of long-term fixed-rate and variable-rate guaranteed bonds. | ||
[2] | Reflects our maximum potential exposure for letters of credit. |
Guarantees Guarantees Maturitie
Guarantees Guarantees Maturities (Details) - Guarantee Obligations $ in Thousands | May 31, 2020USD ($) |
Guarantor Obligations [Line Items] | |
2018 | $ 339,979 |
2019 | 29,265 |
2020 | 157,411 |
2021 | 32,824 |
2022 | 83,628 |
Thereafter | 177,679 |
Contractual Obligation | $ 820,786 |
Guarantees Additional Informati
Guarantees Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | ||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | $ 820,786 | $ 837,435 | |
Guarantee Obligations Unsecured | $ 426,000 | $ 374,000 | |
Guarantee Obligations Unsecured Commitment as Percentage of Total Commitment | 52.00% | 45.00% | |
Guarantee Liability Recorded | $ 11,000 | $ 14,000 | |
Guaranty Liabilities Contingent | 1,000 | 1,000 | |
Guaranty Liabilities | 10,000 | 13,000 | |
Variable rate | |||
Guarantor Obligations [Line Items] | |||
Guarantee Obligations Liquidity Provided to Member Carrying Value | 244,000 | ||
Other guarantees | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 143,072 | 146,244 | |
Guarantor Obligations, Maximum Exposure, Undiscounted | 143,000 | 147,000 | |
Financial Standby Letter of Credit | Adjustable and Floating Rate Tax Exempt Bonds | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 0 | ||
Performance Guarantee | Master Letter of Credit | |||
Guarantor Obligations [Line Items] | |||
Letter of Credit Facility Maximum Additional Amount Potentially Required to be Issued | 70,000 | ||
Financial guarantees | Fixed rate | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 20,000 | ||
Guarantor Obligations, Maximum Exposure, Undiscounted | 34,000 | ||
Financial guarantees | Variable rate | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 244,000 | 247,000 | |
Letters of credit | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | [1] | 413,839 | 379,001 |
Guarantee Obligations Secured | 106,000 | 126,000 | |
Long-term tax-exempt bonds | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | [2] | 263,875 | 312,190 |
Guarantee Type, Other Secured [Member] | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Maximum Exposure, Undiscounted | 25,000 | 25,000 | |
Variable Interest Entity, Primary Beneficiary [Member] | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | 9,999 | 10,091 | |
Guarantor Obligations, Maximum Exposure, Undiscounted | 22,000 | ||
Statewide and Associate [Member] | Variable Interest Entity, Primary Beneficiary [Member] | |||
Guarantor Obligations [Line Items] | |||
Guarantor Obligations, Current Carrying Value | $ 3,000 | $ 1,000 | |
[1] | Reflects our maximum potential exposure for letters of credit. | ||
[2] | Represents the outstanding principal amount of long-term fixed-rate and variable-rate guaranteed bonds. |
Fair Value Measurement Fair Val
Fair Value Measurement Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | $ 671,372 | $ 177,922 |
Cash and Cash Equivalents, Fair Value Disclosure | 671,372 | 177,922 |
Restricted cash | 8,647 | 8,282 |
Equity securities | 60,735 | 87,533 |
Debt Securities, Held-to-maturity, Fair Value | 309,400 | 0 |
Deferred Compensation Plan Assets | 5,496 | 4,984 |
Loans to members, net | 26,649,255 | 25,899,369 |
Loans Receivable, Fair Value Disclosure | 29,252,065 | 25,743,503 |
Accrued interest receivable | 117,138 | 133,605 |
Debt service reserve restricted funds | 14,591 | 17,151 |
Derivative assets | 173,195 | 41,179 |
Short-term Debt | 3,961,985 | 3,607,726 |
Short-term Debt, Fair Value | 3,963,164 | 3,608,259 |
Other Long-term Debt | 19,712,024 | 19,210,793 |
Long-term Debt | 19,712,024 | 19,210,793 |
Long-term Debt, Fair Value | 21,826,337 | 20,147,183 |
Accrued interest payable | 139,619 | 158,997 |
Guaranty Liabilities Contingent and Noncontingent | 10,937 | 13,666 |
Guarantees, Fair Value Disclosure | 11,948 | 13,307 |
Derivative liabilities | 1,258,459 | 391,724 |
Subordinated deferrable debt | 986,119 | 986,020 |
Subordinated Debt Obligations, Fair Value Disclosure | 1,030,108 | 1,004,707 |
Members Subordinated Certificates, Total | 1,339,618 | 1,357,129 |
Members Subordinated Certificates, At Fair Value | 1,339,618 | 1,357,129 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 671,372 | 177,922 |
Restricted cash | 8,647 | 8,282 |
Equity securities | 60,735 | 87,533 |
Deferred Compensation Plan Assets | 5,496 | 4,984 |
Debt service reserve restricted funds | 14,591 | 17,151 |
Short-term Debt, Fair Value | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Held-to-maturity, Fair Value | 309,400 | |
Accrued interest receivable | 117,138 | 133,605 |
Derivative assets | 173,195 | 41,179 |
Short-term Debt, Fair Value | 3,713,164 | 3,608,259 |
Long-term Debt, Fair Value | 11,981,580 | 11,482,715 |
Accrued interest payable | 139,619 | 158,997 |
Derivative liabilities | 1,258,459 | 391,724 |
Subordinated Debt Obligations, Fair Value Disclosure | 1,030,108 | 1,004,707 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans Receivable, Fair Value Disclosure | 29,252,065 | 25,743,503 |
Short-term Debt, Fair Value | 250,000 | 0 |
Long-term Debt, Fair Value | 9,844,757 | 8,664,468 |
Guarantees, Fair Value Disclosure | 11,948 | 13,307 |
Members Subordinated Certificates, At Fair Value | 1,339,618 | 1,357,129 |
Recurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Held-to-maturity, Fair Value | 309,400 | |
Deferred Compensation Plan Assets | 5,496 | 4,984 |
Derivative assets | 173,195 | 41,179 |
Derivative liabilities | 1,258,459 | 391,724 |
Recurring basis | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred Compensation Plan Assets | 4,984 | |
Recurring basis | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Held-to-maturity, Fair Value | 309,400 | |
Derivative assets | 173,195 | 41,179 |
Derivative liabilities | $ 1,258,459 | $ 391,724 |
Fair Value Measurement Recurrin
Fair Value Measurement Recurring Fair Value Measurements (Details) - USD ($) $ in Thousands | May 31, 2020 | May 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities trading, at fair value | $ 309,400 | $ 0 |
Deferred Compensation Plan Assets | 5,496 | 4,984 |
Derivative assets | 173,195 | 41,179 |
Derivative liabilities | 1,258,459 | 391,724 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred Compensation Plan Assets | 5,496 | 4,984 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities trading, at fair value | 309,400 | |
Derivative assets | 173,195 | 41,179 |
Derivative liabilities | 1,258,459 | 391,724 |
Recurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments, Fair Value Disclosure | 60,735 | 87,533 |
Debt securities trading, at fair value | 309,400 | |
Deferred Compensation Plan Assets | 5,496 | 4,984 |
Derivative assets | 173,195 | 41,179 |
Derivative liabilities | 1,258,459 | 391,724 |
Recurring basis | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities | 60,735 | 87,533 |
Deferred Compensation Plan Assets | 4,984 | |
Recurring basis | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities trading, at fair value | 309,400 | |
Derivative assets | 173,195 | 41,179 |
Derivative liabilities | $ 1,258,459 | $ 391,724 |
Fair Value Measurement Addition
Fair Value Measurement Additional Information (Details) - USD ($) | 12 Months Ended | ||
May 31, 2020 | May 31, 2019 | May 31, 2018 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Securities, Held-to-maturity, Fair Value | $ 570,549,000 | ||
Impaired Financing Receivable, Recorded Investment | $ 178,556,000 | 11,853,000 | |
Fair Value Assets Measured On Nonrecurring Basis Change In Unrealized Gain Loss Recorded In Earnings | 0 | 0 | $ 0 |
Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Securities, Held-to-maturity, Fair Value | 570,549,000 | ||
Collateral Pledged [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Impaired Financing Receivable, Recorded Investment | $ 0 | $ 0 |
Business Segments Segment Resul
Business Segments Segment Results and Total Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
May 31, 2020 | May 31, 2019 | May 31, 2018 | May 31, 2017 | |||
Statement of operations: | ||||||
Interest income | $ 1,151,286 | $ 1,135,670 | $ 1,077,357 | |||
Interest expense | [1],[2] | (821,089) | (836,209) | (792,735) | ||
Net interest income | 330,197 | 299,461 | 284,622 | |||
Provision (benefit) for loan losses | (35,590) | 1,266 | 18,575 | |||
Net interest income after provision for loan losses | 294,607 | 300,727 | 303,197 | |||
Non-interest income: | ||||||
Fee and other income | 22,961 | 15,355 | 17,578 | |||
Gain (Loss) on Sale of Derivatives | (55,873) | (43,611) | (74,281) | |||
Unrealized Gain (Loss) on Derivatives | (734,278) | (319,730) | 306,002 | |||
Derivative gains (losses) | (790,151) | (363,341) | 231,721 | |||
Investment securities losses | 9,431 | (1,799) | 0 | |||
Total non-interest income | (757,759) | (349,785) | 249,299 | |||
Non-interest expense: | ||||||
General and administrative expenses | (101,167) | (93,166) | (90,884) | |||
Losses on early extinguishment of debt | (683) | (7,100) | 0 | |||
Other non-interest expense | (25,588) | (1,675) | (1,943) | |||
Total non-interest expense | (127,438) | (101,941) | (92,827) | |||
Income (loss) prior to income taxes | (590,590) | (150,999) | 459,669 | |||
Income tax benefit (expense) | 1,160 | (211) | (2,305) | |||
Net income (loss) | (589,430) | (151,210) | 457,364 | |||
Assets: | ||||||
Total recorded investment in loans | 26,690,854 | 25,905,664 | [3] | |||
Deferred origination costs | 11,526 | 11,240 | [3] | |||
Loans and Leases Receivable, Gross | 26,702,380 | 25,916,904 | [3] | |||
Less: Allowance for loan losses | (53,125) | (17,535) | (18,801) | $ (37,376) | ||
Loans to members, net | 26,649,255 | 25,899,369 | ||||
Other assets | 1,508,350 | 1,225,003 | ||||
Total assets | 28,157,605 | 27,124,372 | ||||
CFC | ||||||
Statement of operations: | ||||||
Interest income | 1,143,397 | 1,126,869 | 1,067,016 | |||
Interest expense | (820,841) | (835,491) | (791,836) | |||
Net interest income | 322,556 | 291,378 | 275,180 | |||
Provision (benefit) for loan losses | (35,590) | (1,266) | (18,575) | |||
Net interest income after provision for loan losses | 286,966 | 292,644 | 293,755 | |||
Non-interest income: | ||||||
Fee and other income | 28,309 | 20,515 | 17,369 | |||
Gain (Loss) on Sale of Derivatives | (54,707) | (42,618) | (71,906) | |||
Unrealized Gain (Loss) on Derivatives | (730,774) | (318,135) | 301,694 | |||
Derivative gains (losses) | (785,481) | (360,753) | 229,788 | |||
Investment securities losses | 9,431 | (1,799) | ||||
Total non-interest income | (747,741) | (342,037) | 247,157 | |||
Non-interest expense: | ||||||
General and administrative expenses | (98,808) | (91,063) | (83,783) | |||
Losses on early extinguishment of debt | (69) | (7,100) | ||||
Other non-interest expense | (25,588) | (1,675) | (1,943) | |||
Total non-interest expense | (124,465) | (99,838) | (85,726) | |||
Income (loss) prior to income taxes | (585,240) | (149,231) | 455,186 | |||
Net income (loss) | (585,240) | (149,231) | 455,186 | |||
Assets: | ||||||
Total recorded investment in loans | 26,669,759 | 25,877,305 | ||||
Deferred origination costs | 11,526 | 11,240 | ||||
Loans and Leases Receivable, Gross | 26,681,285 | 25,888,545 | ||||
Less: Allowance for loan losses | (53,125) | (17,535) | ||||
Loans to members, net | 26,628,160 | 25,871,010 | ||||
Other assets | 1,496,998 | 1,214,045 | ||||
Total assets | 28,125,158 | 27,085,055 | ||||
Other | ||||||
Statement of operations: | ||||||
Interest income | 47,107 | 51,741 | 49,182 | |||
Interest expense | (39,466) | (43,658) | (39,740) | |||
Net interest income | 7,641 | 8,083 | 9,442 | |||
Net interest income after provision for loan losses | 7,641 | 8,083 | 9,442 | |||
Non-interest income: | ||||||
Fee and other income | 9,524 | 2,655 | 1,372 | |||
Gain (Loss) on Sale of Derivatives | (1,166) | (993) | (2,375) | |||
Unrealized Gain (Loss) on Derivatives | 3,504 | (1,595) | 4,308 | |||
Derivative gains (losses) | (4,670) | (2,588) | 1,933 | |||
Total non-interest income | 4,854 | 67 | 3,305 | |||
Non-interest expense: | ||||||
General and administrative expenses | (8,940) | (8,477) | (7,101) | |||
Losses on early extinguishment of debt | (614) | |||||
Other non-interest expense | (8,291) | (1,441) | (1,163) | |||
Total non-interest expense | (17,845) | (9,918) | (8,264) | |||
Income (loss) prior to income taxes | (5,350) | (1,768) | 4,483 | |||
Income tax benefit (expense) | 1,160 | (211) | (2,305) | |||
Net income (loss) | (4,190) | (1,979) | 2,178 | |||
Assets: | ||||||
Total recorded investment in loans | 1,083,197 | 1,087,988 | ||||
Loans and Leases Receivable, Gross | 1,083,197 | 1,087,988 | ||||
Loans to members, net | 1,083,197 | 1,087,988 | ||||
Other assets | 106,525 | 104,890 | ||||
Total assets | 1,189,722 | 1,192,878 | ||||
Elimination | ||||||
Statement of operations: | ||||||
Interest income | (39,218) | (42,940) | (38,841) | |||
Interest expense | 39,218 | 42,940 | 38,841 | |||
Net interest income | 0 | 0 | 0 | |||
Net interest income after provision for loan losses | 0 | 0 | 0 | |||
Non-interest income: | ||||||
Fee and other income | (14,872) | (7,815) | (1,163) | |||
Derivative gains (losses) | 0 | 0 | 0 | |||
Total non-interest income | (14,872) | (7,815) | (1,163) | |||
Non-interest expense: | ||||||
General and administrative expenses | 6,581 | 6,374 | 0 | |||
Other non-interest expense | 8,291 | 1,441 | 1,163 | |||
Total non-interest expense | 14,872 | 7,815 | $ 1,163 | |||
Assets: | ||||||
Total recorded investment in loans | (1,062,102) | (1,059,629) | ||||
Loans and Leases Receivable, Gross | (1,062,102) | (1,059,629) | ||||
Loans to members, net | (1,062,102) | (1,059,629) | ||||
Other assets | (95,173) | (93,932) | ||||
Total assets | $ (1,157,275) | $ (1,153,561) | ||||
[1] | (1) Includes amortization of debt discounts and debt issuance costs, which are generally deferred and recognized as interest expense using the effective interest method. Issuance costs related to dealer commercial paper, however, are recognized as interest expense immediately as incurred. | |||||
[2] | (2) Includes fees related to funding arrangements, such as up-front fees paid to banks participating in our committed bank revolving line of credit agreements. Depending on the nature of the fee, amounts may be deferred and recognized as interest expense ratably over the term of the arrangement or recognized immediately as incurred. | |||||
[3] | The interest rate on unadvanced loan commitments is not set until an advance is made; therefore, all long-term unadvanced loan commitments are reported as variable rate. However, the borrower may select either a fixed or a variable rate when an advance on a commitment is made. |
Business Segments Additional In
Business Segments Additional Information (Details) $ in Thousands | 12 Months Ended | ||
May 31, 2020USD ($)operating_segment | May 31, 2019USD ($) | May 31, 2018USD ($) | |
Segment Reporting [Abstract] | |||
Debt and Equity Securities, Gain (Loss) | $ | $ 9,431 | $ (1,799) | $ 0 |
Number of Operating Segments | operating_segment | 3 |