As filed with the Securities and Exchange Commission on
May 15, 2002
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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, 2002 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 of (I.R.S. employer identification
incorporation or organization) number)
1133 Twenty-First Street, N.W.,
Suite 600 20036
Washington, D.C. (Zip code)
(Address of principal executive
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 12 months (or for 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 [ ]
As of May 1, 2002, there were 1,030,780 shares of Class A Voting Common
Stock, 500,301 shares of Class B Voting Common Stock and 10,063,699 shares of
Class C Non-Voting Common Stock outstanding.
PART I - FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
The following interim condensed consolidated financial statements of the
Federal Agricultural Mortgage Corporation ("Farmer Mac" or the "Corporation")
have been prepared, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. These condensed consolidated financial
statements reflect all normal and recurring adjustments that are, in the opinion
of management, necessary to present 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 condensed consolidated financial
position, condensed consolidated results of operations and condensed
consolidated cash flows as of the dates and for the periods presented. These
condensed consolidated financial statements should be read in conjunction with
the audited 2001 consolidated financial statements of Farmer Mac included in the
Corporation's Form 10-K for the year ended December 31, 2001. Results for
interim periods are not necessarily indicative of those to be expected for the
fiscal year.
The following information concerning Farmer Mac's condensed consolidated
financial statements is included herein:
Condensed Consolidated Balance Sheets as of March 31, 2002 and
December 31, 2001.............................................. 3
Condensed Consolidated Statements of Operations for the three
months ended March 31, 2002 and 2001........................... 4
Condensed Consolidated Statements of Cash Flows for the three
months ended March 31, 2002 and 2001........................... 5
Notes to Condensed Consolidated Financial Statements............. 6
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, December 31,
2002 2001
------------------ ---------------
(unaudited) (audited)
Assets:
Cash and cash equivalents $ 468,664 $ 437,831
Investment securities 957,632 1,007,954
Farmer Mac guaranteed securities 1,618,934 1,690,376
Loans 309,894 201,812
Financial derivatives 317 15
Interest receivable 36,116 56,253
Guarantee fees receivable 3,719 6,004
Prepaid expenses and other assets 18,711 16,963
----------------- -------------------
Total Assets $ 3,413,987 $ 3,417,208
----------------- -------------------
Liabilities and Stockholders' Equity:
Liabilities:
Notes payable
Due within one year $ 2,320,958 $ 2,233,267
Due after one year 890,702 968,463
----------------- -------------------
Total notes payable 3,211,660 3,201,730
Financial derivatives 14,765 20,762
Accrued interest payable 22,701 26,358
Accounts payable and accrued expenses 10,452 18,037
Reserve for losses 17,017 15,884
----------------- -------------------
Total Liabilities 3,276,595 3,282,771
Stockholders' Equity:
Common stock:
Class A Voting, $1 par value, no maximum authorization,
1,030,780 shares issued and outstanding as of
March 31, 2002 and December 31, 2001. 1,031 1,031
Class B Voting, $1 par value, no maximum authorization,
500,301 shares issued and outstanding as of
March 31, 2002 and December 31, 2001. 500 500
Class C Non-Voting, $1 par value, no maximum authorization,
10,060,169 and 10,033,037 shares issued and outstanding
as of March 31, 2002 and December 31, 2001. 10,060 10,033
Additional paid-in capital 81,691 80,960
Accumulated other comprehensive income 3,391 8,395
Retained earnings 40,719 33,518
----------------- -------------------
Total Stockholders' Equity 137,392 134,437
----------------- -------------------
Total Liabilities and Stockholders' Equity $ 3,413,987 $ 3,417,208
----------------- -------------------
See accompanying notes to condensed consolidated financial statements.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended
------------------------------------
Mar. 31, 2002 Mar. 31, 2001
---------------- ----------------
(unaudited)
Interest income:
Investments and cash equivalents $ 10,327 $ 21,088
Farmer Mac guaranteed securities 23,018 28,740
Loans 3,799 603
---------------- ----------------
Total interest income 37,144 50,431
Interest expense 29,674 44,978
---------------- ----------------
Net interest income 7,470 5,453
Gains/(Losses) on financial derivatives
and trading assets 224 (589)
Other income:
Guarantee fees 4,567 3,428
Miscellaneous 391 166
---------------- ----------------
Total other income 4,958 3,594
---------------- ----------------
Total revenues 12,652 8,458
Expenses:
Compensation and employee benefits 1,255 1,237
Regulatory fees 197 223
General and administrative 1,096 1,145
---------------- ----------------
Total operating expenses 2,548 2,605
Provision for losses 2,016 1,383
---------------- ----------------
Total expenses 4,564 3,988
---------------- ----------------
Income before income taxes 8,088 4,470
Income tax expense 2,505 1,588
---------------- ----------------
Net income before cumulative effect 5,583 2,882
of change in accounting principles
Cumulative effect of change in accounting
principles, net of taxes of $400 - (726)
Extraordinary gain, net of taxes of $872 1,619
---------------- ----------------
Net income $ 7,202 $ 2,156
---------------- ----------------
Earnings per share:
Basic earnings per share $ 0.62 $ 0.19
Diluted earnings per share $ 0.59 $ 0.18
Earnings per share before cumulative
effect of change in accounting principles
and extraordinary item:
Basic earnings per share $ 0.48 $ 0.26
Diluted earnings per share $ 0.46 $ 0.25
See accompanying notes to condensed consolidated financial statements.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended
-------------------------------------
Mar. 31, 2002 Mar. 31, 2001
----------------- ------------------
(unaudited)
Cash flows from operating activities:
Net income $ 7,202 $ 2,156
Adjustments to reconcile net income to net cash provided by
operating activities:
Net amortization of investment premiums and discounts 1,167 (350)
Decrease in interest receivable 20,137 22,111
Decrease in guarantee fees receivable 2,285 2,439
Increase in other assets (1,782) (2,159)
Amortization of debt premiums, discounts and issuance costs 10,245 31,019
Decrease in accrued interest payable (3,657) (5,146)
Decrease in other liabilities (4,894) (2,803)
Purchases of (proceeds from) trading investment securities (3,503) 5,680
Mark to market on trading securities and derivatives (224) 1,715
Amortization of settled financial derivatives contracts 202 -
Extraordinary gain on debt repurchase (2,545) -
Provision for losses 2,016 1,063
--------------- ------------------
Net cash provided by operating activities 26,649 55,725
Cash flows from investing activities:
Purchases of investment securities (67,500) (82,450)
Purchases of Farmer Mac guaranteed securities (61,273) (112,645)
Purchases of loans (110,598) (48,636)
Proceeds from repayment of investment securities 112,925 95,848
Proceeds from repayment of Farmer Mac guaranteed securities 125,910 102,001
Proceeds from repayment of loans 2,516 42
Proceeds from sale of Farmer Mac guaranteed securities - 32,534
Settlement of financial derivatives (831) (1,349)
Purchases of office equipment (52) (6)
--------------- ------------------
Net cash provided by (used in) investing activities 1,097 (14,661)
Cash flows from financing activities:
Proceeds from issuance of discount notes 25,948,602 22,619,870
Proceeds from issuance of medium-term notes 11,300 -
Payments to redeem discount notes (25,884,894) (22,780,186)
Payments to redeem medium-term notes (72,680) (99,670)
Proceeds from common stock issuance 759 1,488
--------------- ------------------
Net cash provided by (used in) financing activities 3,087 (258,498)
--------------- ------------------
Net increase (decrease) in cash and cash equivalents 30,833 (217,434)
Cash and cash equivalents at beginning of period 437,831 537,871
--------------- ------------------
Cash and cash equivalents at end of period $ 468,664 $ 320,437
--------------- ------------------
See accompanying notes to condensed consolidated financial statements.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Accounting Policies
(a) Cash and Cash Equivalents
Farmer Mac considers highly liquid investment securities with original
maturities of three months or less to be cash equivalents. Changes in the
balance of cash and cash equivalents are reported in the Condensed Consolidated
Statements of Cash Flows. The following table sets forth information regarding
certain cash and non-cash transactions for the three months ended March 31, 2002
and 2001.
Three Months Ended
March 31,
--------------------------
2002 2001
------------ -----------
(in thousands)
Cash paid for:
Interest $15,318 $ 17,083
Income taxes - 350
Non-cash activity:
Real estate owned acquired through foreclosure - -
Loans securitized as AMBS - 66,372
(b) Loans
As of March 31, 2002, loans held by Farmer Mac included $35.7 million held
for sale and $274.2 million held for investment. As of December 31, 2001, loans
held by Farmer Mac included $25.8 million held for sale and $175.8 million held
for investment.
(c) Financial Derivatives
A financial derivative is a financial instrument that has one or more
underlyings and one or more notional amounts, requires no significant initial
net investment, and has terms that require net settlement. Farmer Mac enters
into financial derivative contracts as an end-user, not for trading or
speculative purposes. Farmer Mac uses financial derivatives to adjust the
characteristics of Farmer Mac's debt to match the characteristics of Farmer
Mac's mortgage assets.
When financial derivatives meet specific criteria, they are accounted for
as either fair value hedges or cash flow hedges. Financial derivatives that do
not satisfy Statement of Financial Accounting Standards No. 133, Accounting for
Derivative Instruments and Hedging Activities ("SFAS 133") hedge criteria are
not accounted for as hedges. Changes in fair value of those financial
derivatives are reported in income or expense.
Net after-tax charges against earnings under SFAS 133 during first quarter
2002 totaled $145,000, and the net after-tax decrease to other comprehensive
income totaled $3.2 million. Substantially all of this amount represents the
estimated present value of the cost of settled forward sale contracts and the
net interest payments on interest-rate swap contracts, using fair values as of
March 31, 2002 and assuming no change in interest rates. Farmer Mac estimates
that $710,000 of the amount currently reported in accumulated other
comprehensive income will be reclassified into earnings within the next twelve
months. The Corporation entered into those interest-rate swap contracts to
derive a lower effective fixed-rate cost of borrowing for periods of up to 15
years than would otherwise have been available to the Corporation in the
conventional debt market. For the quarter ended March 31, 2002, the
ineffectiveness of designated hedges included in Farmer Mac's net income was
immaterial.
(d) Reserve for Losses
Farmer Mac maintains a reserve for losses to cover potential losses on
loans, including Qualified Loans underlying Post-1996 Act Farmer Mac I
Securities and LTSPCs. The reserve is maintained at a level management deems
adequate to cover potential principal losses and interest losses related to
loans that are 90 days or more delinquent. The reserve is increased through
periodic provisions charged to expense and reduced by charge-offs for actual
loan losses, net of recoveries. In estimating potential losses on loans and
outstanding Farmer Mac guarantees, management considers economic conditions,
geographic and agricultural commodity concentrations, the credit profile of the
Qualified Loans, delinquency trends and historical charge-off and recovery
activity. No reserve has been made for Farmer Mac I Securities issued prior to
the 1996 Act or securities issued under the Farmer Mac II Program ("Farmer Mac
II Securities"). Farmer Mac I Securities issued prior to the 1996 Act are
supported by unguaranteed subordinated interests, which are expected to exceed
the estimated credit losses on those securities. Guaranteed Portions
collateralizing Farmer Mac II Securities are guaranteed by the United States
Department of Agriculture ("USDA").
(e) Earnings Per Share
Basic earnings per share are based on the weighted-average number of common
shares outstanding. Diluted earnings per share are based on the weighted-average
number of common shares outstanding adjusted to include all potentially dilutive
common stock. The following schedule reconciles basic and diluted earnings per
share for the three months ended March 31, 2002 and 2001:
Three months ended Three months ended
March 31, 2002 March 31, 2001
------------------------------- ---------------------------------
Dilutive Dilutive
Basic stock Diluted Basic stock Diluted
EPS options EPS EPS options EPS
------------------------------- ---------------------------------
(in thousands, except per share amounts)
Net income $ 7,202 $ 7,202 $ 2,156 $ 2,156
Weighted average shares 11,580 540 12,120 11,210 459 11,669
Earnings per share $ 0.62 $ 0.59 $ 0.19 $ 0.18
(f) Reclassifications
Certain reclassifications of prior period information were made to conform
to the current period presentation.
(g) New Accounting Standards
In April 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 145, Rescission of FASB
Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13 and Technical
Corrections ("SFAS 145"). Effective January 1, 2003, SFAS No. 145 requires gains
and losses from the extinguishment or repurchase of debt to be classified as
extraordinary items only if they meet the criteria for such classification in
Accounting Principles Board Opinion No. 30, Reporting the Results of Operations,
Reporting the Effects of Disposal of a Segment of a Business and Extraordinary,
Unusual and Infrequently Occurring Events and Transactions ("APB 30"). Until
January 1, 2003, gains and losses from the extinguishment or repurchase of debt
must be classified as extraordinary items. After January 1, 2003 any gain or
loss resulting from the extinguishment or repurchase of debt classified as an
extraordinary item in a prior period that does not meet the criteria for such
classification under APB 30 must be reclassified.
Note 2. Off-Balance Sheet Guaranteed Securities
For information regarding the off-balance sheet risks associated with
Farmer Mac's guarantees of AMBS and LTSPCs, see "Management's Discussion and
Analysis of Financial Condition and Results of Operations - Risk Management -
Credit Risk."
Note 3. Comprehensive Income
Comprehensive income (loss) is comprised of net income plus other changes
in stockholders' equity not resulting from investments by or distributions to
stockholders. The following table sets forth comprehensive income (loss) for the
three months ended March 31, 2002 and 2001. The changes in unrealized gains on
securities available-for-sale are net of the related deferred tax benefit of
$4.5 million for the three months ended March 31, 2002, and deferred tax benefit
of $4.6 million for the three months ended March 31, 2001. The changes in the
fair value of financial derivatives classified as cash flow hedges are net of
the related deferred tax expense of $1.7 million for the three months ended
March 31, 2002, and deferred tax benefit of $6.7 million for the three months
ended March 31, 2001.
Three Months Ended
March 31,
--------------------------------
2002 2001
--------------------------------
(in thousands)
Net income $ 7,202 $ 2,156
Change in unrealized gain on securities
available-for-sale, net of taxes (8,327) (8,317)
Cumulative effect of change in accounting principles - (8,632)
Change in the fair value of financial derivatives
classified as cash flow hedges, net of taxes and
reclassification adjustments 3,250 (3,552)
--------------------------------
Comprehensive income (loss) $ 2,125 $ (18,345)
--------------------------------
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Special Note Regarding Forward-Looking Statements
Certain statements made in this Form 10-Q are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995
pertaining to management's current expectations as to Farmer Mac's future
financial results, business prospects and business developments. Forward-looking
statements include, without limitation, any statement that may predict,
forecast, indicate or imply future results, performance or achievements, and
typically are accompanied by, and identified with, such terms as "anticipates,"
"believes," "expects," "intends," "should" and similar phrases. The following
management's discussion and analysis includes forward-looking statements
addressing Farmer Mac's prospects for earnings and growth in loan purchase,
guarantee and securitization volume; trends in net interest income and provision
for losses; changes in capital position; and other business and financial
matters.
Management's expectations for Farmer Mac's future necessarily involve a
number of assumptions, estimates and the evaluation of risks and uncertainties.
Various factors could cause Farmer Mac's actual results or events to differ
materially from the expectations as expressed or implied by the forward-looking
statements, including: uncertainties regarding the rate and direction of
development of the secondary market for agricultural mortgage loans; the
possible establishment of additional statutory or regulatory restrictions
applicable to Farmer Mac, such as restrictions on Farmer Mac's investment
authority; substantial changes in interest rates, agricultural land values,
commodity prices, export demand for U.S. agricultural products and the general
economy; protracted adverse weather, market or other conditions affecting
particular geographic regions or particular commodities related to agricultural
mortgage loans backing Farmer Mac Guaranteed Securities; legislative or
regulatory developments or interpretations of Farmer Mac's statutory charter
that could adversely affect Farmer Mac or the ability of certain lenders to
participate in its programs or the terms of any such participation; the
availability of debt funding in sufficient quantities and at favorable rates to
support continued growth; the rate of growth in agricultural mortgage
indebtedness; the size of the agricultural mortgage market; borrower preferences
for fixed-rate agricultural mortgage indebtedness; the willingness of lenders to
sell agricultural mortgage loans into the Farmer Mac secondary market; the
willingness of investors to invest in agricultural mortgage-backed securities;
competition in the origination or purchase of agricultural mortgage loans and
the sale of agricultural mortgage-backed and debt securities; the effects on the
agricultural economy of the government payments that are provided for in the
farm bill signed into law May 13, 2002; or changes in Farmer Mac's status as a
government-sponsored enterprise.
The foregoing factors are not exhaustive. Other sections of this report may
include additional factors that could adversely affect Farmer Mac's business and
its financial performance. Furthermore, new risk factors emerge from time to
time and it is not possible for management to predict all such risk factors, nor
assess the effects of such factors on Farmer Mac's business or the extent to
which any factor, or combination of factors, may cause actual results to differ
materially from the expectations expressed or implied by the forward-looking
statements. In light of these potential risks and uncertainties, no undue
reliance should be placed on any forward-looking statements expressed in this
report. Furthermore, Farmer Mac undertakes no obligation to release publicly the
results of revisions to any forward-looking statements that may be made to
reflect any future events or circumstances.
Results of Operations
Operating Results. SFAS 133 requires the change in the fair values of
certain financial derivatives to be reflected in the Corporation's net income or
other comprehensive income. Management believes that reporting results by
reference to operating income and operating revenues, excluding the cumulative
effect of the change in accounting principles recognized on January 1, 2001
under SFAS 133 and its ongoing effects during the reporting periods, provides
meaningful operating measures of Farmer Mac's financial performance. Such
information is presented to supplement, not replace, net income, revenues, cash
from operations, or any other operating or liquidity performance measures
prescribed by accounting principles generally accepted in the United States.
Reconciliation of the effects of SFAS 133
Three Months Ended March 31,
2002 2001
------------------------- -------------------------
(in thousands)
Operating income $ 6,955 $ 3,161
Cumulative effect of change
in accounting principles, net of tax - (726)
Gains on financial derivatives
and trading assets, net of tax 146 (380)
Benefit from non-amortization of
premium payments, net of tax 101 101
------------------------- -------------------------
Net income $7,202 $ 2,156
========================= =========================
Overview. Net income for first quarter 2002, including the cumulative and
ongoing effects of SFAS 133 during the quarter and the extraordinary gain on
debt extinguishment, was $7.2 million or $0.59 per diluted share. Net income for
first quarter 2001 was $2.2 million or $0.18 per share. Operating income,
excluding the extraordinary gain, totaled $5.3 million for first quarter 2002,
or $0.44 per share, compared to $3.2 million, or $0.27 per share, for first
quarter 2001.
Farmer Mac's revenue growth continued in first quarter 2002, reflecting the
effects of outstanding guarantee volume as of March 31, 2002 that was more than
$1.2 billion higher than at the close of first quarter 2001 and increased net
interest income due to a higher average net interest yield on interest-earning
assets. During first quarter 2002, Farmer Mac (1) purchased $39.2 million of
guaranteed portions of loans guaranteed by the USDA, (2) purchased $74.9 million
of Farmer Mac I loans and (3) added $338.8 million in long-term standby purchase
commitments.
USDA is forecasting net cash income on farms for 2002 to be $50.9 billion,
which includes an assumption for government payments of $10.7 billion. However,
the USDA's current government payments assumption is based on existing
legislation and does not take into account increases contained in the farm bill
signed into law May 13, 2002 or any emergency assistance that may be contained
in any special legislation. In 2001, emergency assistance comprised $9.1 billion
of the $21 billion in government payments made to the agricultural sector and
net cash income on farms for 2001 was $59.5 billion. USDA currently expects farm
real estate values to rise during 2002 by about one percent. Regionally, farm
real estate values may vary with differing rates of increase, or even decrease,
depending on commodities grown and regional economic factors.
Set forth below is a more detailed discussion of Farmer Mac's results of
operations.
Net Interest Income. Net interest income was $7.5 million for first quarter
2002 compared to $5.5 million for first quarter 2001. The strength in the net
interest yield is a result of continued emphasis on sound interest-rate risk
management and debt issuance strategies and a $609,000 (7 basis points) benefit
from the income recognition of yield maintenance payments received in
conjunction with borrower prepayments during first quarter 2002. The income
realized from yield maintenance payments is, in effect, the accelerated present
value of an expected future income stream which, in turn, leads to slightly
reduced net interest income in future reporting periods. The timing and size of
these payments varies greatly and, as such, variations should not be considered
indicative of positive or negative trends to gauge future financial results. The
following table provides information regarding the average balances and rates of
interest-earning assets and funding for the three months ended March 31, 2002
and 2001.
Three Months Ended March 31,
-------------------------------------------------------------------------
2002 2001
----------------------------------- ------------------------------------
Average Income/ Average Average Income/ Average
Balance Expense Rate Balance Expense Rate
------------ ----------- ---------- ------------ ----------- ----------
(dollars in thousands)
Interest-earning assets:
Cash and cash equivalents $ 497,461 $ 2,585 2.08% $ 537,448 $ 7,691 5.72%
Investments 944,130 7,742 3.28% 896,226 13,397 5.98%
Farmer Mac guaranteed securities 1,640,621 23,018 5.61% 1,784,342 28,740 6.44%
Loans 263,799 3,799 5.76% 34,690 603 6.95%
------------ ----------- --------- ------------- ---------- ---------
Total interest earning assets 3,346,011 37,144 4.44% 3,252,706 50,431 6.20%
------------ ----------- ------------- ----------
Funding:
Discount notes 2,217,218 14,161 2.55% 2,181,045 30,564 5.61%
Medium-term notes 997,003 15,513 6.22% 915,348 14,414 6.30%
------------ ----------- --------- ------------- ---------- ---------
Total interest-bearing liabilities 3,214,221 29,674 3.69% 3,096,393 44,978 5.81%
Net non-interest bearing funding 131,790 - - 156,313 - -
------------ ----------- --------- ------------- ---------- ---------
Total funding $ 3,346,011 29,674 3.55% $3,252,706 44,978 5.53%
------------ ----------- --------- ------------- ---------- ---------
Net interest income/yield $ 7,470 0.89% $ 5,453 0.67%
----------- --------- ---------- ---------
The following table 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 changes in
volume (change in volume multiplied by old rate) and changes in rate (change in
rate multiplied by old volume). Combined rate/volume variances, the third
element of the calculation, are allocated based on their relative size.
Three Months Ended March 31, 2002
Compared to Three Months Ended
March 31, 2001
-------------------------------------------
Increase/(Decrease) Due to
-------------------------------------------
Rate Volume Total
-------------- -------------- -------------
(in thousands)
Income from interest-earning assets
Cash and cash equivalents $ (4,572) $ (534) $ (5,106)
Investments (6,414) 759 (5,655)
Farmer Mac guaranteed securities (3,521) (2,201) (5,722)
Loans (85) 3,281 3,196
-------------- -------------- -------------
Total (14,592) 1,305 (13,287)
Expense from interest-bearing liabilities (17,100) 1,796 (15,304)
-------------- -------------- -------------
Change in net interest income $ 2,508 $ (491) $ 2,017
-------------- -------------- -------------
Other Income. Other income, which is comprised of guarantee fee income and
miscellaneous income, totaled $5.0 million for first quarter 2002 compared to
$3.6 million for the same period in 2001. Guarantee fee income, the largest
component of other income, was $4.6 million for first quarter 2002, compared to
$3.4 million for first quarter 2001. The relative increase in guarantee fee
income reflects an increase in the average balance of outstanding guarantees.
Miscellaneous income was $391,000 for first quarter 2002, compared to $166,000
for first quarter 2001.
Expenses. During first quarter 2002, operating expenses totaled $2.5
million, compared to $2.6 million for first quarter 2001. Operating expenses as
a percentage of operating revenues were 21 percent for first quarter 2002,
compared to 29 percent for first quarter 2001.
Farmer Mac's provision for principal and interest losses was $2.0 million
for first quarter 2002 compared to $1.4 million for the same period in 2001. As
of March 31, 2002, Farmer Mac's reserve for losses totaled $17.0 million, or
0.45 percent of outstanding post-1996 Act loans and AMBS, compared to $12.4
million, or 0.49 percent, as of March 31, 2001.
The provision for income taxes totaled $2.5 million for first quarter 2002
compared to $1.6 million for the same period in 2001. Farmer Mac's effective tax
rate for first quarter 2002 was 31.0 percent compared to 35.5 percent for 2001.
The reduction in the effective tax rate reflects the effects of certain
tax-advantaged investment securities.
Extraordinary Gain. During first quarter 2002 Farmer Mac recognized a net
after-tax extraordinary gain of $1.6 million resulting from the repurchase of
$43.8 million of outstanding Farmer Mac debt.
Business Volume. The following table sets forth the amount of loans
purchased or guaranteed, and AMBS issued during the periods indicated:
Three Months Ended
March 31,
----------------------------
2002 2001
------------ ------------
(in thousands)
Purchase and guarantee volume:
Farmer Mac I
Loans & AMBS $ 74,875 $ 48,600
LTSPC 338,821 49,695
Farmer Mac II 39,154 47,707
------------ ------------
Total loans purchased or
guaranteed $ 452,850 $146,002
------------ ------------
AMBS issuances:
Retained $ - $ 33,932
Sold - 32,440
------------ ------------
Total AMBS issuances $ - $ 66,372
------------ ------------
See "Overview" above for a discussion regarding loans purchased and
guaranteed by Farmer Mac.
Indicators of future loan purchase and guarantee volume (but not of LTSPC,
swap or bulk purchase volume) in the immediately succeeding reporting period
include outstanding commitments to purchase loans and the total balance of loans
submitted for approval or approved but not yet purchased. Many purchase
commitments entered into by Farmer Mac are mandatory delivery commitments. If a
seller obtains a mandatory commitment and is unable to deliver the loans as
required thereunder, Farmer Mac requires the seller to pay a fee to modify,
extend or cancel the commitment. As of March 31, 2002, outstanding commitments
to purchase Farmer Mac I loans totaled $18.6 million, compared to $18.4 million
as of March 31, 2001. Of the total Farmer Mac I commitments outstanding as of
March 31, 2002 and 2001, $4.3 million and $7.9 million, respectively, were
mandatory commitments. Loans submitted for approval or approved but not yet
committed to purchase totaled $82.9 million as of March 31, 2002, compared to
$133.7 million as of March 31, 2001. Not all of these loans are purchased, as
some are denied for credit reasons or withdrawn by the seller.
While significant progress has been made in developing the secondary market
for agricultural mortgages, Farmer Mac continues to face the challenges of
establishing a market where none previously existed. Acceptance of Farmer Mac's
programs is increasing among lenders, reflecting the competitive rates, terms
and products offered and the advantages Farmer Mac believes its programs
provide. For Farmer Mac to succeed in realizing its business development and
profitability objectives over the longer term, the use of Farmer Mac's programs
and products by agricultural mortgage lenders, whether traditional or
non-traditional, must continue to expand.
Balance Sheet Review
During the three month period ended March 31, 2002, total assets decreased
by $3.2 million, with increases in program assets (Farmer Mac guaranteed
securities and loans) of $36.6 million being more than offset by decreases in
non-program and other assets. For further information regarding both on- and
off-balance sheet guaranteed securities, see "Supplemental Information" below.
Similar to the decrease in total assets during the period, total liabilities
decreased by $6.2 million from December 31, 2001 to March 31, 2002.
Average return on equity, excluding the effects of Statement of Financial
Accounting Standards No. 115, Accounting for Certain Investments in Debt and
Equity Securities, SFAS 133 and the extraordinary item, was 16.4 percent for
first quarter 2002, compared to 12.3 percent for first quarter 2001.
As of March 31, 2002, Farmer Mac's statutory core capital totaled $134.0
million, compared to $126.0 million as of December 31, 2001. As of March 31,
2002, the statutory core capital balance exceeded Farmer Mac's statutory minimum
capital requirement by approximately $21.8 million.
On April 12, 2001, the Farm Credit Administration ("FCA") issued its final
risk-based capital regulation for Farmer Mac. The regulation requires Farmer Mac
to meet the risk-based capital standards by May 23, 2002. We have maintained a
dialogue with FCA regarding the application of the regulation and the complex
underlying economic model - particularly certain provisions that suggest to us
that the FCA went outside the authorizing statute. If no change is made to the
regulation, at some time in the future it could lead to an increase in the
capital requirement for certain newly guaranteed program assets and so cause
Farmer Mac to alter its strategic plan for future growth. We believe at this
time that the regulation, as issued, would not cause us to alter that strategic
plan materially and we are confident that Farmer Mac will be in compliance when
required to meet the standard. As of the end of first quarter 2002, had the
regulation been effective, the required risk-based capital for Farmer Mac would
have been $32.3 million, significantly below our minimum capital requirement of
$112.2 million.
Risk Management
Interest-Rate Risk. Farmer Mac is subject to interest-rate risk on all
assets held for investment because of possible timing differences in the cash
flows of the assets and related liabilities. This risk is primarily related to
Farmer Mac I and II Securities because of the ability of borrowers to prepay
their mortgages before the scheduled maturities, thereby increasing the risk of
asset and liability cash flow mismatches. Farmer Mac's primary strategy for
managing interest-rate risk related to Farmer Mac I and II Securities and other
assets held for investment is to fund them with liabilities that have similar
durations, or average cash flow patterns over time, and provide flexibility to
accommodate changing prepayment rates in changing interest rate environments. To
achieve the desired funding objective, Farmer Mac uses a mix of short-term
Discount Notes, interest-rate swaps and callable and non-callable Medium-Term
Notes. By using a mix of liabilities that includes callable debt, the duration
of the liabilities will tend to increase or decrease as interest rates change in
a manner similar to changes in the duration of the assets (the rate of change in
the duration of an asset or liability to a change in interest rates is referred
to as convexity).
One method Farmer Mac uses to monitor its exposure to interest-rate risk is
to measure the sensitivity of its market value of equity ("MVE") to an immediate
and instantaneous parallel shift of the U.S. Treasury yield curve. The following
schedule summarizes the results of Farmer Mac's MVE sensitivity analysis as of
March 31, 2002 and December 31, 2001.
Percentage Change in MVE from Base Case
---------------------------------------
Interest Rate Scenario March 31, 2002 December 31, 2001
- ---------------------- -------------- -----------------
+ 300 bp -5.9% -1.3%
+ 200 bp -2.9% -0.1%
+ 100 bp -0.7% 0.6%
- 100 bp -2.0% -2.4%
- 200 bp -6.9% -6.4%
- 300 bp -9.8% -16.2%
Credit Risk. The outstanding principal balance of loans held and securities
guaranteed by Farmer Mac as of March 31, 2002 and December 31, 2001 is
summarized in the table below.
March 31, 2002 December 31, 2001
---------------- -------------------
(in thousands)
Farmer Mac I:
Post-1996 Act $ 3,781,971 $ 3,542,976
Pre-1996 Act 41,414 48,979
Farmer Mac II 592,835 595,156
---------------- ---------------
Total $ 4,416,220 $ 4,187,111
---------------- ---------------
Farmer Mac assumes 100 percent of the credit risk on post-1996 Act Farmer
Mac I loans; pre-1996 Act Farmer Mac I loans back securities that are supported
by mandatory 10 percent first loss subordinated interests that mitigate credit
exposure; Farmer Mac II loans are guaranteed by the USDA. Farmer Mac believes it
has little or no credit risk exposure to pre-1996 Act Farmer Mac I loans because
of the first loss subordinated interests related to pools of those loans, or to
Farmer Mac II loans because of the USDA guarantee.
As of March 31, 2002, post-1996 Act Farmer Mac I loans that were 90 days or
more past due, in foreclosure or in bankruptcy represented 2.32 percent of the
outstanding principal balance of all post-1996 Act Farmer Mac I loans, compared
to 2.62 percent as of March 31, 2001 and 1.70 percent as of December 31, 2001.
Farmer Mac anticipates fluctuations in the delinquency rate from quarter to
quarter, with higher levels likely as of March 31 and September 30 of each year
due to the semi-annual payment characteristics of most Farmer Mac loans.
The following table shows Farmer Mac I delinquencies distributed by
post-1996 Act loans and pre-1996 Act loans.
Farmer Mac I Delinquencies (1) (2)
- ----------------------------------------------------------------------
Post-1996 Act Pre-1996 Act Total
---------------- --------------- ---------
As of:
March 31, 2002 2.32% 5.83% 2.37%
December 31, 2001 1.70% 7.00% 1.79%
September 30, 2001 2.16% 4.66% 2.21%
June 30, 2001 1.72% 3.69% 1.77%
March 31, 2001 2.62% 5.83% 2.72%
December 31, 2000 1.25% 6.49% 1.44%
September 30, 2000 1.80% 5.55% 1.96%
June 30, 2000 1.25% 4.12% 1.41%
March 31, 2000 1.45% 4.89% 1.65%
<FN>
(1) Includes loans 90 days or more past due, in foreclosure or in bankruptcy.
(2) Farmer Mac assumes 100 percent of the credit risk on post-1996 Act loans.
Pre-1996 Act loans back securities that are supported by unguaranteed first
loss subordinated interests representing approximately 10 percent of the
balance of the loans backing each security.
</FN>
Farmer Mac maintains a reserve to cover losses on post-1996 Act Farmer Mac
I loans. Based on Farmer Mac's loan collection experience, the value of the
collateral securing the loans and continuing provisions for the reserve for
losses, Farmer Mac believes that ongoing charge-offs will be covered adequately
by the reserve for losses. Farmer Mac expects quarterly charge-offs for loan
losses to continue at their current level of approximately $850,000 per quarter
for the next several quarters. In certain collateral liquidation scenarios,
Farmer Mac may recover amounts previously written off if liquidation proceeds
exceed previous estimates. As of March 31, 2002, the weighted-average original
loan-to-value ratio for all post-1996 Act loans was 49 percent. Farmer Mac's
provision for principal and interest losses was $2.0 million for first quarter
2002, compared to $2.0 million for fourth quarter 2001 and $1.4 million for
first quarter 2001. As of March 31, 2002, Farmer Mac's reserve for losses
totaled $17.0 million, or 45 basis points of the outstanding post-1996 Act loans
and AMBS, compared to $15.9 million (45 basis points) as of December 31, 2001
and $12.4 million (49 basis points) as of March 31, 2001.
The following schedule summarizes the changes in the reserve for losses for
the three months ended March 31, 2002 and 2001:
Three Months Ended March 31,
----------------------------
2002 2001
------------- --------------
(in thousands)
Beginning balance $ 15,884 $ 11,323
Provision for losses 2,016 1,383
Net charge-offs (883) (320)
----------- -----------
Ending balance $ 17,017 $ 12,386
------------ -----------
The following table summarizes the post-1996 Act delinquencies by original
loan-to-value ratio (calculated by dividing the original loan principal balance
by the original appraised value):
Distribution of Post-1996
Act Delinquencies (1) by
UPB as of Mar. 31, 2002
- ---------------------------------------------------------------------
(original loan-to-value ratio)
0.00% to 40.00% 8%
40.01% to 50.00% 13%
50.01% to 60.00% 36%
60.01% to 70.00% 41%
70.01% to 80.00% 2%
-------------
Total 100%
-------------
<FN>
(1) Includes loans 90 days or more past due, in foreclosure or in bankruptcy.
</FN>
As of March 31, 2002, the weighted average original loan-to-value ratio for
post-1996 Act Farmer Mac I loans that were 90 days or more past due, in
foreclosure or in bankruptcy was 56.6 percent.
The following table segregates the post-1996 Act Farmer Mac I loan
portfolio and delinquencies as of March 31, 2002 by year of origination,
geographic region and commodity.
Distribution of
Post-1996 Act Delinquency
Loans Rate(1)
---------------- --------------
By year of origination:
Before 1996 24% 0.82%
1996 8% 7.17%
1997 10% 5.62%
1998 16% 3.24%
1999 18% 1.98%
2000 10% 1.10%
2001 12% 0.16%
2002 2% 0.00%
--------------- --------------
Total 100% 2.32%
--------------- --------------
By geographic region (2):
Northwest 29% 4.53%
Southwest 46% 1.53%
Mid-North 11% 1.56%
Mid-South 4% 2.04%
Northeast 6% 0.61%
Southeast 4% 0.61%
--------------- --------------
Total 100% 2.32%
--------------- --------------
By commodity:
Crops 43% 2.23%
Permanent plantings 30% 3.49%
Livestock 21% 1.15%
Part-time farm 5% 1.29%
Other 1% 0.14%
--------------- --------------
Total 100% 2.32%
--------------- --------------
<FN>
(1) Includes loans 90 days or more past due, in foreclosure or in bankruptcy
(2) Geographic regions - Mid-North (IA, IL, IN, MI, MN, MO, WI); Mid-South (KS,
OK, TX); Northeast (CT, DE, KY, MA, MD, ME, NC, NH, NJ, NY, OH, PA, RI, TN,
VA, VT, WV); Northwest (ID, MT, ND, NE, OR, SD, WA, WY); Southeast (AL, AR,
FL, GA, LA, MS, SC); and Southwest (AZ, CA, CO, HI, NM, NV, UT).
</FN>
Supplemental Information
The following tables present quarterly and annual information regarding
loan purchases and guarantees and outstanding guarantees.
Farmer Mac Purchases and Guarantees
- -------------------------------------------------------------------------------------------
Farmer Mac I
----------------------------
Loans & AMBS LTSPC Farmer Mac II Total
---------------- ----------- ----------------- -----------
(in thousands)
For the quarter ended:
March 31, 2002 $ 74,875 $ 338,821 $ 39,154 $ 452,850
December 31, 2001 68,527 237,140 51,056 356,723
September 30, 2001 69,561 246,472 42,396 358,429
June 30, 2001 85,439 499,508 57,012 641,959
March 31, 2001 48,600 49,695 47,707 146,002
December 31, 2000 45,727 180,502 36,029 262,258
September 30, 2000 292,658 158,291 40,036 490,985
June 30, 2000 45,578 34,409 94,870 174,857
March 31, 2000 58,283 - 22,570 80,853
December 31, 1999 168,828 229,984 18,511 417,323
For the year ended:
December 31, 2001 272,127 1,032,967 198,171 1,503,265
December 31, 2000 442,246 373,202 193,505 1,008,953
Outstanding Guarantees (1)
- --------------------------------------------------------------------------------------------------------------------------------
Farmer Mac I
---------------------------------------------
Post-1996 Act
------------------------------
Loans & AMBS(2) LTSPC Pre-1996 Act Farmer Mac II Total Held in Portfolio(3)
------------------- ---------- --------------- --------------- ------------ ----------------------
(in thousands)
As of:
March 31, 2002 $1,655,485 $2,126,485 $ 41,414 $ 592,836 $4,416,220 $1,899,484
December 31, 2001 1,658,716 1,884,260 48,979 595,156 4,187,111 1,857,232
September 30, 2001 1,605,160 1,731,861 58,813 608,944 4,004,778 1,804,391
June 30, 2001 1,572,800 1,537,061 65,709 579,251 3,754,821 1,763,676
March 31, 2001 1,466,443 1,083,528 72,646 549,003 3,171,620 1,648,896
December 31, 2000 1,615,914 862,804 83,513 517,703 3,079,934 1,581,905
September 30, 2000 1,621,516 707,850 92,536 491,820 2,913,722 1,571,315
June 30, 2000 1,354,623 575,143 100,414 467,352 2,497,532 1,292,359
March 31, 2000 1,310,710 551,423 107,403 387,992 2,357,528 1,268,889
December 31, 1999 1,266,522 575,097 118,214 383,266 2,343,099 1,237,623
<FN>
(1) Farmer Mac assumes 100 percent of the credit risk on post-1996 Act loans.
Pre-1996 Act loans back securities that are supported by unguaranteed
subordinated interests representing approximately 10 percent of the balance
of the loans. Farmer Mac II loans are guaranteed by the USDA.
(2) Periods prior to June 30, 2001 include only AMBS.
(3) Included in total outstanding guarantees.
</FN>
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Farmer Mac is exposed to market risk attributable to changes in interest
rates. Farmer Mac manages this market risk by entering into various financial
transactions, including derivative financial instruments, and by monitoring its
exposure to changes in interest rates. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations - Risk Management -
Interest-Rate Risk" for further information regarding Farmer Mac's exposure to
interest-rate risk and strategies to manage such risk. For information regarding
Farmer Mac's use of derivative financial instruments, including Farmer Mac's
accounting policies for such instruments, see Note 1(c) to the Condensed
Consolidated Financial Statements.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Farmer Mac is not a party to any material pending legal proceedings.
Item 2. Changes in Securities and Use of Proceeds
(a) Not applicable.
(b) Not applicable.
(c) Farmer Mac is a federally chartered instrumentality of the United
States and its Common Stock is exempt from registration pursuant to
Section 3(a)(2) of the Securities Act of 1933.
Pursuant to Farmer Mac's policy that permits Directors of Farmer Mac
to elect to receive shares of Class C Non-Voting Common Stock in lieu
of their annual cash retainers, on January 29, 2002, Farmer Mac issued
an aggregate of 591 shares of its Class C Non-Voting Common Stock, at
an issue price of $40.50 per share, to the eleven Directors who
elected to receive such stock in lieu of their cash retainers.
(d) Not applicable.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
* 3.1 - Title VIII of the Farm Credit Act of 1971, as most recently amended
by the Farm Credit System Reform Act of 1996, P.L. 104-105 (Form 10-K filed
March 29, 1996).
* 3.2 - Amended and restated By-Laws of the Registrant (Form 10-Q filed
August 12, 1999).
+* 10.1 - Stock Option Plan (Previously filed as Exhibit 19.1 to Form 10-Q
filed August 14, 1992).
+* 10.1.1 - Amendment No. 1 to Stock Option Plan (Previously filed as Exhibit
10.2 to Form 10-Q filed August 16, 1993).
+* 10.1.2 - 1996 Stock Option Plan (Form 10-Q filed August 14, 1996).
+* 10.1.3- Amended and Restated 1997 Incentive Plan (Form 10-Q filed August
14, 1997).
+* 10.2 - 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).
+* 10.2.1 - Amendment No. 1 dated as of January 10, 1991 to Employment
Contract between Henry D. Edelman and the Registrant (Previously filed as
Exhibit 10.4 to Form 10-K filed April 1, 1991).
+* 10.2.2 - Amendment to Employment Contract dated as of June 1, 1993 between
Henry D. Edelman and the Registrant (Previously filed as Exhibit 10.5 to
Form 10-Q filed November 15, 1993).
+* 10.2.3 - Amendment No. 3 dated as of June 1, 1994 to Employment Contract
between Henry D. Edelman and the Registrant (Previously filed as Exhibit
10.6 to Form 10-Q filed August 15, 1994).
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
+* 10.2.4 - Amendment No. 4 dated as of February 8, 1996 to Employment
Contract between Henry D. Edelman and the Registrant (Form 10-K filed March
29, 1996).
+* 10.2.5 - Amendment No. 5 dated as of June 13, 1996 to Employment Contract
between Henry D. Edelman and the Registrant (Form 10-Q filed August 14,
1996).
+* 10.2.6 - Amendment No. 6 dated as of August 7, 1997 to Employment Contract
between Henry D. Edelman and the Registrant (Form 10-Q filed November 14,
1997).
+* 10.2.7 - Amendment No. 7 dated as of June 4, 1998 to Employment Contract
between Henry D. Edelman and the Registrant (Form 10-Q filed August 14,
1998).
+* 10.2.8 - Amendment No. 8 dated as of June 3, 1999 to Employment Contract
between Henry D. Edelman and the Registrant (Form 10-Q filed August 12,
1999).
+* 10.2.9 - Amendment No. 9 dated as of June 1, 2000 to Employment Contract
between Henry D. Edelman and the Registrant (Form 10-Q filed August 14,
2000).
+* 10.2.10- Amendment No. 10 dated as of June 7, 2001 to Employment Contract
between Henry D. Edelman and the Registrant (Form 10-Q filed August 14,
2001).
+* 10.3 - 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).
+* 10.3.1 - 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).
+* 10.3.2 - 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).
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
+* 10.3.3 - 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).
+* 10.3.4 - Amendment No. 4 dated June 1, 1993 to Employment Contract between
Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.10 to
Form 10-K filed March 31, 1994).
+* 10.3.5 - Amendment No. 5 dated as of June 1, 1994 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit
10.12 to Form 10-Q filed August 15, 1994).
+* 10.3.6 - Amendment No. 6 dated as of June 1, 1995 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 14,
1995).
+* 10.3.7 - Amendment No. 7 dated as of February 8, 1996 to Employment
Contract between Nancy E. Corsiglia and the Registrant (Form 10-K filed
March 29, 1996).
+* 10.3.8 - Amendment No. 8 dated as of June 13, 1996 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 14,
1996).
+* 10.3.9 - Amendment No. 9 dated as of August 7, 1997 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-Q filed November 14,
1997).
+* 10.3.10- Amendment No. 10 dated as of June 4, 1998 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 14,
1998).
+* 10.3.11- Amendment No. 11 dated as of June 3, 1999 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 12,
1999).
+* 10.3.12- Amendment No. 12 dated as of June 1, 2000 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 14,
2000).
+* 10.3.13- Amendment No. 13 dated as of June 7, 2001 to Employment Contract
between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 14,
2001).
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
+* 10.4 - Employment Contract dated as of September 1, 1997 between Tom D.
Stenson and the Registrant (Previously filed as Exhibit 10.8 to Form 10-Q
filed November 14, 1997).
+* 10.4.1 - Amendment No. 1 dated as of June 4, 1998 to Employment Contract
between Tom D. Stenson and the Registrant (Previously filed as Exhibit
10.8.1 to Form 10-Q filed August 14, 1998).
+* 10.4.2 - Amendment No. 2 dated as of June 3, 1999 to Employment Contract
between Tom D. Stenson and the Registrant (Form 10-Q filed August 12,
1999).
+* 10.4.3 - Amendment No. 3 dated as of June 1, 2000 to Employment Contract
between Tom D. Stenson and the Registrant (Form 10-Q filed August 14,
2000).
+* 10.4.4 - Amendment No. 4 dated as of June 7, 2001 to Employment Contract
between Tom D. Stenson and the Registrant (Form 10-Q filed August 14,
2001).
+* 10.5 - Employment Contract dated February 1, 2000 between Jerome G. Oslick
and the Registrant (Previously filed as Exhibit 10.6 to Form 10-Q filed May
11, 2000).
+* 10.5.1 - Amendment No. 1 dated as of June 1, 2000 to Employment Contract
between Jerome G. Oslick and the Registrant (Previously filed as Exhibit
10.6.1 to Form 10-Q filed August 14, 2000).
+* 10.5.2 - Amendment No. 2 dated as of June 7, 2001 to Employment Contract
between Jerome G. Oslick and the Registrant (Previously filed as Exhibit
10.6.2 to Form 10-Q filed August 14, 2001).
* 10.6 - Lease Agreement, dated June 28, 2001 between EOP - Two Lafayette,
L.L.C. and the Registrant (Previously filed as Exhibit 10.10 to Form 10-K
filed March 27, 2002).
21 - Farmer Mac Mortgage Securities Corporation, a Delaware corporation.
* 99.1 - Map of U.S. Department of Agriculture (Secretary of Agriculture's)
Regions (Previously filed as Exhibit 1.1 to Form 10-K filed April 1, 1991).
* Incorporated by reference to the indicated prior filing.
+ Management contract or compensatory plan.
(b) Reports on Form 8-K.
On January 24, 2002, the Registrant filed a report on Form 8-K that
attached a press release announcing the Registrant's financial results for
fourth quarter 2001.
* 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 caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
May 15, 2002
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 - Finance
(Principal Financial Officer)