Released on November 6, 2023, Federal Agricultural Mortgage Corp (AGM.A, Financial)'s earnings report for the third quarter of 2023 shows a strong financial performance. The company, which increases the accessibility of financing for American agriculture and rural infrastructure, reported significant growth in several key areas.
Financial Highlights
AGM.A's net interest income grew by 29% year-over-year to $87.6 million. The net effective spread increased by 27% from the prior-year period to a record $83.4 million. The company's net income attributable to common stockholders was $51.3 million, compared to $34.6 million in the same period last year. Furthermore, AGM.A reported record core earnings of $45.2 million, reflecting a 35% growth year-over-year.
Capital Position and Business Volume
The company maintained a strong capital position with total core capital of $1.4 billion, exceeding the statutory requirement by 69%. The Tier 1 Capital Ratio stood at 16% as of September 30, 2023. AGM.A also reported an outstanding business volume of $27.7 billion and provided $2.3 billion in liquidity and lending capacity to lenders serving rural America.
Commentary
In the earnings report, the company stated:
We delivered another strong quarter, our sixth consecutive quarter of record earnings, seventh consecutive quarter of record net effective spread, and our tenth consecutive quarter of business volume growth. Our efforts over the last four years to strengthen our organizational alignment and resources with our business segments have supported increased diversification of our business and contributed to these results."
Financial Tables Summary
The financial tables provided in the report show a net change in business volume of $914,959 for Q3 2023. The diluted earnings per share (EPS) for the quarter was $4.69, a 27% increase from the previous quarter and a 47% increase year-over-year. The core EPS was $4.13, reflecting a 7% sequential increase and a 35% increase year-over-year.
Conclusion
Overall, Federal Agricultural Mortgage Corp (AGM.A, Financial) demonstrated strong financial performance in Q3 2023, with significant growth in net interest income, net effective spread, and net income attributable to common stockholders. The company's strong capital position and consistent business volume growth highlight its resilience and potential for future growth.
Explore the complete 8-K earnings release (here) from Federal Agricultural Mortgage Corp for further details.
