As filed with the Securities and Exchange Commission on
May 15, 1995
_______________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________________________
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995.
Commission File Number 0-17440
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
(Exact name of registrant as specified in
its charter)
Federally chartered instrumentality
of the United States 52-1578738
_______________________________ ______________________________
(State or other jurisdiction (I.R.S. employer identification
of incorporation or organization) number)
919 18th Street, N.W., Suite 200,
Washington, D.C. 20006
_________________________________ _____________________________
(Address of principal executive (Zip code)
offices)
(202) 872-7700
(Registrant's telephone number, including area code)
____________________________________________________
Indicate by check mark whether the Registrant (1) has
filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the
preceding twelve months (or such shorter period that the
Registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90
days.
Yes [X] No
Indicate the number of shares outstanding of each of
the issuer's classes of common stock, as of the last
practicable date.
As of May 15, 1995, there were 670,000 shares of Class
A Voting Common Stock, 500,301 shares of Class B Voting
Common Stock, and 1,170,301 shares of Class C Non-Voting
Common Stock outstanding.
PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
The following interim consolidated financial statements
of the Federal Agricultural Mortgage Corporation (the
"Corporation" or "Farmer Mac") have been prepared, without
audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Such interim
consolidated financial statements reflect all normal and
recurring adjustments that are, in the opinion of
management, necessary to a fair statement of
the results for the interim periods presented. Certain
information and footnote disclosures normally included in
annual consolidated financial statements have been
condensed or omitted as permitted by such rules and
regulations. Management believes that the disclosures are
adequate to present fairly the consolidated financial
position, consolidated results of operations and
consolidated cash flows at the dates and for the
periods presented. These condensed financial statements
should be read in conjunction with the audited 1994
financial statements of Farmer Mac. Results for interim
periods are not necessarily indicative of those to be
expected for the fiscal year.
The following information concerning Farmer Mac's
financial statements as of March 31, 1995, December 31, 1994
and March 31, 1994 is included herein.
Consolidated Balance Sheets..........................3
Consolidated Statements of Operations................4
Consolidated Statements of Cash Flows................5
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
March 31, 1995 December 31, 1994
(unaudited)
ASSETS:
Cash and cash equivalents.. $ 637 $ 200
Interest receivable.......... 8,862 14,023
Guarantee fees receivable 330 454
Mortgage payments receivable. 4,732 1,196
Investments, net ............ 86,870 78,218
Mortgage portfolio, net ..... 378,048 382,833
Office equipment, net ....... 89 98
Prepaid expenses and other
assets.................... 309 216
TOTAL ASSETS....... $479,877 $ 477,238
LIABILITIES AND STOCKHOLDERS' EQUITY:
LIABILITIES:
Allowance for mortgage-
backed securities sold... $ 93 $ 81
Accounts payable and accrued
expenses................ 929 972
Accrued interest payable
on Medium-Term Notes.... 6,855 7,450
Debentures, notes and
bonds, net:
Due within one year.... 189,454 168,307
Due after one year..... 270,634 288,209
TOTAL LIABILITIES.... 467,965 465,019
STOCKHOLDERS' EQUITY:
Common stock:
Class A Voting, $1 par
value, no maximum
authorization, 670,000
shares issued and
outstanding.............. 670 670
Class B Voting, $1 par
value, no maximum
authorization, 500,301
shares issued and
outstanding............. 500 500
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands) (Continued)
March 31, 1995 December 31, 1994
(unaudited)
Class C Non-Voting, $1
par value, no maximum
authorization, 1,170,301
shares issued and
outstanding............ 1,170 1,170
Additional paid in
capital................ 19,331 19,331
Accumulated deficit..... (9,759) (9,452)
TOTAL STOCKHOLDERS'
EQUITY........... 11,912 12,219
TOTAL LIABILITIES
AND STOCKHOLDERS'
EQUITY........ $ 479,877 $ 477,238
See accompanying notes to consolidated financial statements.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands, Except Per Share Amounts)
Three Months Ended
March 31, 1995 March 31,1994
(unaudited) (unaudited)
INTEREST INCOME:
Investments and
cash equivalents....$ 1,220 $ 1,171
Mortgage portfolio.... 6,810 6,625
TOTAL INTEREST INCOME.. 8,030 7,796
INTEREST EXPENSE....... 7,763 7,637
NET INTEREST INCOME... 267 159
OTHER INCOME:
Guarantee fees......... 307 267
Miscellaneous 17 57
TOTAL OTHER INCOME.... 324 324
OTHER EXPENSES:
Compensation and
employee benefits..... 465 452
Professional fees...... 85 95
Insurance.............. 57 35
Rent................... 42 40
Regulatory fees........ 92 70
Board of Directors
fees and meeting
expenses............. 78 72
Administrative......... 79 96
TOTAL OTHER EXPENSES.. 898 860
NET LOSS................. $ (307) $ (377)
NET LOSS PER SHARE....... $ (0.13) $ (0.16)
See accompanying notes to consolidated financial statements.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
Three Months Ended
March 31, 1995 March 31, 1994
(unaudited) (unaudited)
_____________ ______________
CASH FLOWS FROM
OPERATING ACTIVITIES:
Loss from Operations........ $ (307) $ (377)
Adjustments to reconcile
loss to net cash provided
by operating activities:
Amortization of premium
on mortgage portfolio..... 1,719 1,737
Depreciation and
amortization............. 429 275
Decrease in guarantee
fees receivable.......... 124 309
Decrease in interest
receivable................ 5,161 6,548
Increase in mortgage
payments receivable....... (3,536) (4,413)
Increase in prepaid
expenses and other
assets.................... (93) (27)
Amortization of debt
issuance costs............ 50 79
(Decrease) increase in
accounts payable and
accrued expenses.......... (43) 274
Decrease in accrued
interest payable on
medium term notes......... (595) (580)
Provision for losses on
Farmer Mac I Program...... 29 25
Net cash provided by
operating activities...... 2,938 3,850
CASH FLOWS FROM
INVESTING ACTIVITIES:
Motgage purchases.......... (15,106) (12,991)
Purchases of investments... (223,905) (111,593)
Proceeds from maturity
of investments............ 216,218 91,500
Proceeds from mortgage
principal repayments...... 18,465 29,351
Purchases of office
equipment................. (2) (4)
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands) (Continued)
Three Months Ended
March 31, 1995 March 31, 1994
(unaudited) (unaudited)
_____________ ______________
Net cash (used) provided
by investing activities... (4,330) (3,737)
CASH FLOWS FROM
FINANCING ACTIVITIES:
Proceeds from issuance
of Medium-Term Notes..... 9,989 -
Payments to redeem
Medium-Term Notes........ (7,185) 13,020)
Proceeds from issuance
of Discount Notes........ 306,525 134,028
Discount notes redeemed... (307,500) (122,000)
Net cash provided (used)
by financing activities.. 1,829 (992)
Net increase (decrease)
in cash and cash
equivalents.............. 437 (879)
Cash and cash equivalents
at beginning of period... 200 1,081
Cash and cash equivalents
at end of period......... $ 637 $ 202
Supplemental disclosures
of cash flow information:
Cash paid during the
three-month period for:
Interest.......... $ 6,577 $ 7,285
See accompanying notes to consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. ACCOUNTING POLICIES
(a) Principles of Consolidation
Financial information at and for the three months
ended March 31, 1995 is consolidated to include the accounts
of Farmer Mac and its two wholly owned subsidiaries, Farmer
Mac Mortgage Securities Corporation and Farmer Mac
Acceptance Corporation. All material intercompany
transactions have been eliminated in consolidation.
(b) Reclassifications
Certain reclassifications of the 1994 information were made
to conform with the 1995 presentation.
NOTE 2. OFF-BALANCE SHEET FARMER MAC GUARANTEED SECURITIES
Farmer Mac is a party to transactions involving
financial instruments with off-balance sheet risk. These
transactions include guarantees by Farmer Mac of securities
not held in its portfolio. Farmer Mac issues guarantees in
the normal course of business to fulfill its statutory
purpose of increasing liquidity for agricultural mortgage
lenders. Farmer Mac guarantees the timely payment of
principal and interest on securities issued under the Farmer
Mac I and Farmer Mac II Programs. The following table sets
forth the outstanding principal balances of Farmer Mac
Guaranteed Securities issued under the Farmer Mac I and
Farmer Mac II Programs and not held in its portfolio.
March 31, 1995 March 31, 1994
(In Thousands)
Farmer Mac I......... $ 148,802 $ 84,407
Farmer Mac II........ $ 5,187 $ 7,902
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
LIQUIDITY AND CAPITAL RESOURCES
Farmer Mac's primary sources of liquidity are issuances
of debt obligations, and principal and interest payments
received on mortgages underlying securities purchased by
Farmer Mac under the Farmer Mac I and Farmer Mac II
Programs. Farmer Mac's Board has authorized the issuance of
up to $1.5 billion of Discount Notes and Medium-Term Notes.
Funds from the borrowings may be used in the Farmer Mac I
and Farmer Mac II Programs to cover transaction costs,
guarantee payments and the costs of purchasing Farmer Mac
Guaranteed Securities and Guaranteed Portions issued in the
Farmer Mac I and Farmer Mac II Programs and to retire
existing Notes. Funds from the borrowings also may be used
for liquidity purposes. At March 31, 1995, Farmer Mac had
460.1 million of Discount Notes and Medium-Term Notes (net
of unamortized debt issuance costs, discounts and premiums)
outstanding, a $3.6 million increase from December 31, 1994.
During the first three months of 1995, Farmer Mac issued
$308.5 million of Discount Notes and $10 million of Medium-
Term Notes and redeemed $307.5 million of Discount Notes and
$ 7.2 million of Medium-Term Notes.
The $8.7 million increase in investments from December
31, 1994 to March 31, 1995 resulted from the increase in the
liquidity portfolio, comprised of short-term commercial
paper and U.S. agency securities. The $4.8 million
reduction in the mortgage portfolio largely resulted from
principal and interest payments received on the mortgage-
backed securities issued under the Corporation's Linked
Portfolio Strategy, net of the acquisition of Farmer Mac
Guaranteed Portions purchased under the Farmer Mac II
Program.
Proceeds of any future Note issuances are expected to
be used by the Corporation primarily to fund purchases of
Farmer Mac Guaranteed Securities and Guaranteed Portions
under the Farmer Mac I and Farmer Mac II Programs and to
maintain Farmer Mac's liquidity position.
At March 31, 1995, Farmer Mac's total loss allowance
was $322 thousand. The mortgage portfolio is shown net of
its applicable allowance of $229 thousand at March 31, 1995,
representing an increase of $16 thousand from year-end
1994; the allowance for Farmer Mac Guaranteed Securities
not held by Farmer Mac was $93 thousand at March 31, 1995,
representing an increase of $12 thousand from year-end 1994.
Future additions to this allowance will be charged to
earnings and the amounts in the allowance account will be
used to cover payments of claims under Farmer Mac
guarantees. Farmer Mac considers the amounts in the
allowance account to be adequate to cover its exposure'
to guarantee payments in the Farmer Mac I Program.
Before Farmer Mac is required to make a guarantee payment on
Farmer Mac I Securities, full recourse must be taken against
a reserve or subordinated interest initially established in
an amount equal to at least ten percent (10%) of the initial
pool balance.
At March 31, 1995, a total of three loans aggregating
$400 thousand were 90 days or more past due, two loans
totaling $300 thousand were in foreclosure and title to one
loan with an outstanding principal balance of $613 thousand
had been acquired by the trust in the Farmer Mac I Program.
The six loans combined represent 0.4% of the aggregate
principal amount of outstanding Farmer Mac I Securities at
March 31, 1995. Management believes that no losses will be
incurred by Farmer Mac as a result of the loans in
foreclosure or the real estate owned by the trust. No loss
allowance has been made specifically for the Farmer Mac II
Program because the Guaranteed Portions are backed by the
full faith and credit of the United States and are not
exposed to credit losses.
At March 31, 1995, Farmer Mac's regulatory required
minimum capital was $5.5 million and its actual capital
level was $11.9 million. At December 31, 1994, Farmer Mac's
regulatory required minimum capital was $4.8 million, and
its actual capital level was $12.2 million. Beginning in
December 1996, higher statutory minimum capital requirements
are scheduled to become effective, significantly increasing
the required amount of Farmer Mac's regulatory capital. If
those requirements had been in effect at March 31, 1995,
Farmer Mac's actual capital would have been $790 thousand
less than the total minimum capital required. As previously
reported, the Board has authorized and management is
actively pursuing a legislative initiative to revise the
Farmer Mac charter. That initiative, if successful, would,
among other things, delay beyond 1996 the implementation of
the higher regulatory capital requirements. Although draft
legislation has been submitted to various Congressional
Committees that have jurisdiction over Farmer Mac, no
specific bill has been introduced in Congress. There can be
no assurance that any such legislation, if introduced, will
be enacted by Congress, or that, if enacted, such
legislation will include any or all of the revisions Farmer
Mac seeks and not include revisions adverse to Farmer Mac's
business. In addition,there can be no assurance that, if
legislation is enacted, the volume of any business generated
under a revised charter will result in profitability for
Farmer Mac or that Farmer Mac will be able to raise capital,
either from retained earnings or from external financing
sources, such as an offering of common or preferred stock,
sufficient to allow Farmer Mac to comply with future capital
requirements.
If Farmer Mac were unable to satisfy the higher capital
requirements, whenever they became effective, the Director
of the Office of Secondary Market Oversight, Farmer Mac's
regulator, would be required to take the mandatory
supervisory measures and authorized to take the optional
supervisory measures previously reported, depending upon the
capital level in which Farmer Mac is then classified.
The imposition of supervisory measures could have a material
adverse impact on Farmer Mac's results of operations and its
ability to raise capital, borrow or engage in transactions
with third parties; thus, such measures could, in effect,
preclude Farmer Mac from complying with higher capital
standards. Ultimately, if a conservator were to be
appointed for Farmer Mac, stockholders could lose some or
all of the value of their equity investment in Farmer Mac,
and creditors could experience a reduced level of
recovery on their claims.
In the opinion of management, Farmer Mac has sufficient
liquidity and capital for the next twelve months.
RESULTS OF OPERATIONS
General. Farmer Mac reported a net loss for the three
months ended March 31, 1995 of $307 thousand, a decrease of
$70 thousand from the $377 thousand loss reported for the
three months ended March 31, 1994. The decrease in loss is
attributable to an increase in net interest income, largely
a result of increased yield maintenance income above the
accelerated level of premium amortization for the three
months ended March 31, 1995 as compared to the three months
ended March 31, 1994.
A number of factors have constrained participation in
Farmer Mac's programs, and caused its core business
activities to be unprofitable. Those factors include: the
excess liquidity of many agricultural lenders; the
attractiveness of loans (otherwise qualified under the
Farmer Mac programs) as investments; the disinclination of
lenders to offer, and the lack of borrower demand for, long-
term, fixed rate agricultural real estate loans as a result
of the higher profitability associated with short-term
lending; Farmer Mac's inability to control the pooling
process, particularly, the pooler's mix of loan products
and rates, marketing activities, and loan securitization
decisions; and the unfavorable capital treatment
afforded banks and Farm Credit institutions holding
subordinated securities created in Farmer Mac
transactions.
Improvements in Farmer Mac's operating results will
depend upon the volume of new guarantee transactions. While
the Agricultural Real Estate and Farmer Mac II Programs have
generated interest income and guarantee fee income, the
volume of guarantee transactions has not been sufficient to
generate income in excess of operating expenses, which has
required Farmer Mac to continue to use its capital to fund
operations. The use of capital to fund operations has
continued to reduce Farmer Mac's stockholders' equity, which
has decreased $307 thousand from December 31, 1994 to March
31, 1995.
With regard to the Prudential Securities/Equitable
Agri-Business open window program, Farmer Mac has been
informed by Equitable that it continues to have discussions
with prospective institutions regarding the continuation of
that program following the withdrawal of Prudential as
pooler, but that it has not yet contracted with one. The
final transaction under that program is expected to close
in the second quarter of 1995. Following that transaction,
Prudential will no longer be a pooler in the Farmer Mac
program.
With regard to the joint Fannie Mae, AgFirst (formerly,
the Farm Credit Bank of Columbia) and Farmer Mac rural
housing initiative, the parties are continuing to finalize
the legal documentation necessary to implement the program,
which is now scheduled to commence operations on August 1,
1995.
The Western Farm Credit Bank, in accordance with the
terms of its strategic alliance with Farmer Mac, is in the
process of finalizing the program documentation for its open
window program and commencing the formation of its
nationwide network of originators and sellers. Western
anticipates the program to be operational during the second
quarter of 1995.
While management believes that each of these programs,
if continued or commenced, as the case may be, will be
successful, there is no assurance that they will generate
sufficient volume to result in any Farmer Mac guarantee
transactions.
Farmer Mac's future profitability will be affected not
only by guarantee volume but also by any payments Farmer Mac
must make on its guarantees; payments it must make on its
Notes; the income it earns on its investment securities, its
mortgage portfolio and other funds it is holding; and its
administrative expenses. Losses, if any, on guarantees will
be affected by many circumstances, including agricultural
growing conditions, agricultural market conditions, changes
in government agricultural support policies and the general
economy. The primary sources of funding for the payment of
claims made under guarantees are the fees Farmer Mac charges
for providing its guarantees, together with Farmer Mac's
loss allowance, invested capital and the proceeds of any
other debt issuances.
Even if Farmer Mac's legislative initiative is
successful and Congress revises the Farmer Mac charter,
Farmer Mac's future will still be dependent upon continued,
more effective and significantly increased utilization of its
programs by its Class A and Class B stockholders.
Average Balances, Income and Expense, Yields and Rates.
The following table presents, for the periods indicated,
information regarding interest income on average interest
earning assets and related yields, as well as interest
expense on average interest bearing liabilities and related
rates paid. The average balances were calculated by
averaging month-end balances.
Three Months Ended March 31,
1995 1994
(Dollars in Thousands)
Average Income/ Average Average Income/ Average
Balances Expense Rate Balances Expense Rate
Assets
Earning assets:
Mortgage-backed securities $ 377,416 $ 6,810 7.22% $ 396,719 $ 6,625 6.68%
Investments and cash
equivalents 86,570 1,220 5.64% 107,790 1,171 4.34%
Total earning assets 463,986 8,030 6.92% 504,509 7,796 6.18%
Other assets 11,220 11,502
$ 475,206 $ 516,011
Liabilities and Stockholders' Equity
Interest-bearing liabilities
Debentures, notes
and bonds, net $ 456,572 $ 7,763 6.80% $ 495,424 $ 7,637 6.17%
Other liabilities 6,594 7,062
Stockholders' equity 12,040 13,525
$ 475,206 $ 516,011
Net interest income/spread $ 267 0.12% $ 159 0.01%
Net yield on interest
earning assets 0.23% 0.13%
Rate/Volume Analysis. The table below sets forth
certain information regarding the changes in the components
of Farmer Mac's net interest income for the periods
indicated. For each category, information is provided on
changes attributable to (a) changes in volume (change in
volume multiplied by old rate); (b) changes in rate (change
in rate multiplied by old volume); and (c) the total.
Combined rate/volume variances, a third element of the
calculation, are allocated based on their relative
size.
Three Months Ended March 31, 1995
Compared to Three Months Ended March 31, 1994
Increase or (Decrease) Due to
Rate Volume Total
(in thousands)
Income from interest-earning assets:
Mortgage Portfolio $ 468 $ (283) $ 185
Investments 146 (97) 49
Total income from interest-earning
assets 614 (380) 234
Expense on interest-bearing
liabilities 528 (402) 126
Change in net interest income $ 86 $ 22 $ 108
PERIOD ENDED MARCH 31, 1995
COMPARED TO PERIOD ENDED MARCH 31, 1994
Net Interest Income. Net interest income totaled $267
thousand for the three months ended March 31, 1995, a $108
thousand increase from the three months ended March 31,
1994. The increase in net interest income is the result of
the 11 basis point (0.11%) increase in the net interest
spread, largely a result of an increase in yield maintenance
income above the accelerated level of premium amortization
for March 31, 1995 as compared to March 31, 1994.
Interest Income. Interest income totaled $8.0 million
and $7.8 million for the three months ended March 31, 1995
and 1994, respectively. The $234 thousand increase is
attributable to the increase in the average rate of
interest-earning assets which more than offset the decline
in the average balances of interest-earning assets. The
increase in the average rate of interest-earning assets is
attributable to the overall increase in the rate of
Guaranteed Portions and Securities issued under the
Farmer Mac II Program, a result of rate adjustments in
January 1995, and the increased level of yield maintenance
income above the accelerated level of premium amortization.
During the three months ended March 31, 1995,
prepayments of mortgage loans underlying the Farmer Mac I
Securities totaled $8.2 million, as compared to $11.6
million for the three months ended March 31, 1994. As a
result of these prepayments, Farmer Mac recognized $357
thousand of interest income from yield maintenance payments
in the three months ended March 31, 1995, as compared to
$240 thousand in the three months ended March 31, 1994, and
accelerated the level of premium amortization by $297
thousand in the three months ended March 31, 1995, as
compared to $455 thousand in the three months ended March
31, 1994.
Interest Expense. Interest expense for the three months
ended March 31, 1995 and 1994 amounted to $7.8 million and
$7.6 million, respectively, an increase of $126 thousand.
The increase in interest expense is attributable to the 63
basis point (0.63%) increase in the average cost of
interest-bearing liabilities, a result of the increase in
short-term interest rates from March 31, 1994 to March 31,
1995. As of March 31, 1995, the Corporation had outstanding
$125.1 million of Discount Notes with a weighted average
rate of 6.05% as compared to $115.5 million of Discount
Notes with a weighted average rate of 3.38% at March 31,
1994.
Other Income. Other income totaled $324 thousand for
the three months ended March 31, 1995 and 1994. Guarantee
fee income, the principal component of other income,
increased $40 thousand from $267 thousand for the three
months ended March 31, 1994 to $307 thousand for the three
months ended March 31, 1995. The increase is largely
attributable to the issuance of $98.1 million of Farmer Mac
I Securities in the third quarter of 1994 and the first
quarter of 1995 and to the $31.6 million growth in the
Farmer Mac II Program since March 31, 1994.
Miscellaneous income, composed primarily of transaction
fees generated from the Farmer Mac II Program, decreased $40
thousand from $57 thousand for the three months ended March
31, 1994 to $17 thousand for the three months ended March
31, 1995. The decrease in transaction fees results from the
level of issuances of Farmer Mac II Securities and purchases
of Guaranteed Portions under the Farmer Mac II Program for
the comparable periods. Farmer Mac issued $4.4 million of
Farmer Mac II Securities and purchased $3.5 million of
Guaranteed Portions for the three months ended March 31,
1995, as compared to $14.2 million of issuances of Farmer
Mac II Securities for the three months ended March 31, 1994.
Other Expenses. Other expenses totaled $898 thousand
for the three months ended March 31, 1995, an increase of
$38 thousand from the three months ended March 31, 1994.
The increase in other expenses is attributable to the
increase in insurance expense, regulatory fees and
compensation and employee benefits, which were partially
offset by the decrease in administrative expenses.
Insurance expense increased $22 thousand from the three
months ended March 31, 1994 to the three months ended March
31, 1995, a result of an increase in the amount of Directors
and Officers Liability insurance coverage.
Regulatory fees increased $22 thousand from the three
months ended March 31, 1994 to the three months ended March
31, 1995, a result of the increase in Farmer Mac's
assessment from $326 thousand for the 1993-94 fiscal year
(subsequently reduced by a $34 thousand refund from the
1992-93 fiscal year) to $368 thousand for the 1994-95 fiscal
year.
Compensation and employee benefits increased $13
thousand from the three months ended March 31, 1994 to the
three months ended March 31, 1995, a result of an increase
in staffing during the comparable periods. During the first
quarter of 1994, Farmer Mac added an additional employee
to assume legal responsibilities for the Farmer Mac II
Program, previously performed by an outside law
firm.
Administrative expenses decreased $17 thousand from the
three months ended March 31, 1994 to the three months ended
March 31, 1995, a result of a reduction in travel related
expenses and advertising costs, both of which resulted from
less pooler activity.
Dividends. Farmer Mac has not paid and does not
expect to pay dividends on its common stock in the near
future. Dividends on the common stock are subject to
determination and declaration by the Board. In February
1992, the Board adopted a policy stating that no dividends
would be paid on Farmer Mac Voting or Non-Voting Common
Stock until such time as Farmer Mac's stockholders' equity
is at least equal to $22 million (the amount of gross
proceeds raised by Farmer Mac in its initial common stock
offering). Thereafter, up to 50% of accumulated net
earnings may be paid out as dividends, provided that
stockholders' equity remains at least equal to $22 million.
No preference between holders of the Voting Common Stock and
Class C Non-Voting Common Stock has been established
relating to dividends. The ratio of dividends paid on each
share of Class C Non-Voting Common Stock to each share of
Voting Common Stock, however, will be three-to-one. If
dividends are to be paid to holders of the Voting Common
Stock, such per share dividends to holders of Class A and
Class B Voting Common Stock will be equal.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The registrant is not a party to any pending legal proceedings.
Item 2. Changes in Securities.
Not applicable.
Item 3. Defaults upon Senior Securities.
Not applicable.
Item 4. Submission of Matters to a Vote of Stockholders.
Not applicable.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
Description
* 3.1 - Title VII of Public Law 100-233 (Form 10 filed January 24, 1989).
* 3.2 - Section 1839 of the Food, Agriculture, Conservation and Trade
Act of 1990 (P.L. 101-624) (Form 10-K filed April 1, 1991).
* 3.3 - Section 503 of the Food, Agriculture, Conservation, and Trade
Act Amendments of 1991 (P.L. 102-237) (Form 10-K filed March 30,
1992).
** 3.4 - Amended and restated Bylaws of the registrant.
+* 10.1 - Stock Option Plan (Previously filed as Exhibit 19.1 to Form
10-Q filed August 14, 1992).
___________________
* Incorporated by reference to the indicated prior filing.
** Filed herewith.
+ Management contract or compensatory plan.
+* 10.2 - Amendment No. 1 to Stock Option Plan (Form 10-Q filed
August 16, 1993).
+* 10.3 - Employment Agreement dated May 5, 1989 between Henry D.
Edelman and the Registrant (Previously filed as Exhibit 10.4
to Form 10-K filed February 14, 1990).
+* 10.4 - Amendment No. 1, dated January 10, 1991, to Employment
Agreement between Henry D. Edelman and the Registrant
(Form 10-K filed April 1, 1991).
+* 10.5 - Amendment to Employment Contract dated as of June 1, 1993
between Henry D. Edelman and the Registrant (Form 10-Q filed
November 15, 1993).
+* 10.6 - Amendment No. 3, dated as of June 1, 1994, to Employment
Contract between Henry D. Edelman and the Registrant (Form
10-Q filed August 15, 1994).
+* 10.7 - Employment Agreement dated May 11, 1989 between Nancy E.
Corsiglia and the Registrant (Previously filed as Exhibit
10.5 to Form 10-K filed February 14, 1990).
+*10.8 - Amendment dated December 14, 1989 to Employment Agreement
between Nancy E. Corsiglia and the Registrant (Previously
filed as Exhibit 10.5 to Form 10-K filed February 14, 1990).
+* 10.9 - Amendment No. 2 dated February 14, 1991, to Employment
Agreement between Nancy E. Corsiglia and the Registrant
(Previously filed as Exhibit 10.7 to Form 10-K filed
April 1, 1991).
+* 10.10 - Amendment to Employment Contract dated as of June 1, 1993
between Nancy E. Corsiglia and the Registrant (Previously
filed as Exhibit 10.9 to Form 10-Q filed November 15,
1993).
_________________________
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
+* 10.11 - Amendment No. 4 dated June 1, 1993 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-K
filed March 30, 1994).
+* 10.12 - Amendment No. 5, dated as of June 1, 1994, to Employment
Contract between Nancy E. Corsiglia and the Registrant
(Form 10-Q filed August 15, 1994).
+* 10.13 - Employment Agreement dated June 13, 1989 between Thomas R.
Clark and the Registrant (Previously filed as Exhibit 10.6
to Form 10-K filed February 14, 1990).
+* 10.14 - Amendment No. 1 dated February 14, 1991 to Employment
Agreement between Thomas R. Clark and the Registrant
(Previously filed as Exhibit 10.9 to Form 10-K filed
April 1, 1991).
+* 10.15 - Amendment to Employment Contract dated as of June 1, 1993
between Thomas R. Clark and the Registrant (Previously
filed as Exhibit 10.12 to Form 10-Q filed November 15,
1993).
+* 10.16 - Amendment No. 3 dated June 1, 1993 to Employment Contract
between Thomas R. Clark and the Registrant (Form 10-K filed
March 30, 1994).
+* 10.17 - Amendment No. 4, dated as of June 1, 1994, to Employment
Contract between Thomas R. Clark and the Registrant (Form
10-Q filed August 15, 1994).
+* 10.18 - Employment Agreement dated April 29, 1994 between Charles
M. Lewis and the Registrant (Form 10-Q filed August 15,
1994).
+* 10.19 - Employment Agreement dated October 7, 1991 between Michael
T. Bennett and the Registrant (Previously filed as Exhibit
10.16 to Form 10-K filed March 30, 1992).
_____________________
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
+* 10.20 - Amendment to Employment Contract dated as of June 1, 1993
between Michael T. Bennett and the Registrant (Previously
filed as Exhibit 10.17 to Form 10-Q filed November 15, 1993).
+* 10.21 - Amendment No. 2 dated June 1, 1993 to Employment Contract
between Michael T. Bennett and the Registrant (Form 10-K
filed March 30, 1994).
+* 10.22 - Amendment No. 3, dated as of June 1, 1994, to Employment
Contract between Michael T. Bennett and the Registrant
(Form 10-Q filed August 15, 1994).
+* 10.23 - Employment Agreement dated March 15, 1993 between Christopher
A. Dunn and the Registrant (Previously filed as Exhibit
10.17 to Form 10-Q filed May 17, 1993).
+* 10.24 - Amendment to Employment Contract dated as of June 1, 1993
between Christopher A. Dunn and the Registrant (Previously
filed as Exhibit 10.19 to Form 10-Q filed November 15, 1993).
+* 10.25 - Amendment No. 2 dated June 1, 1993 to Employment Contract
between Christopher A. Dunn and the Registrant (Form 10-K
filed March 30, 1994).
+* 10.26 - Amendment No. 3, dated as of June 1, 1994, to Employment
Contract between Christopher A. Dunn and the Registrant
(Form 10-Q filed August 15, 1994).
* 10.27 - Lease Agreement, dated September 30, 1991 between 919
Eighteenth Street, N.W., Associates Limited Partnership
and the Registrant (Previously filed as Exhibit 10.20 to
Form 10-K filed March 30, 1992).
________________
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
* 10.28 - Strategic Alliance Agreement, dated November 15, 1994,
between Western Farm Bank and the Registrant, as amended
January 1, 1995 (Form 10-K filed March 31, 1995).
21 - Subsidiaries.
21.1 - Farmer Mac Mortgage Securities Corporation, a Delaware
corporation.
21.2 - Farmer Mac Acceptance Corporation, a Delaware corporation.
* 99.1 - Map of U.S. Department of Agriculture (USDA) Regions
(Previously filed as Exhibit 1.1 to Form 10-K filed
April 1, 1991).
(b) Reports on Form 8-K.
The Registrant has not filed any reports on Form 8-K
during the quarter ended March 31, 1995.
_________________
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of
the Securities Exchange Act of 1934, the Registrant has duly
aused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
May 15, 1995
By:/s/ Henry D. Edelman
__________________________________________
Henry D. Edelman
President and Chief Executive Officer
(Principal Executive Officer)
/s/ Nancy E. Corsiglia
_________________________________
Nancy E. Corsiglia
Vice President - Treasurer and
Chief Financial Officer
(Principal Financial Officer)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________________
EXHIBITS
TO
FORM 10-Q
UNDER
THE SECURITIES EXCHANGE ACT OF 1934
____________________________________
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
Exhibit Description
** 3.4 Amended and restated Bylaws of the Registrant.
___________________
** Filed Herewith.