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National & World Ag News Headlines |
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Farm Credit Reports Year-End Financials
USAgNet - 02/23/2017
The Farm Credit System reported combined net income of $4.8 billion for the year ended December 31, 2016, as compared with $4.7 billion for the prior year. The system also reported combined net income of $1.3 billion for the fourth quarter of 2016, as
compared with $1.2 billion for the fourth quarter of 2015.
"The System continues to execute its mission of lending to rural America despite headwinds arising from low prices for certain commodities," remarked Tracey McCabe, President and CEO of the Federal Farm Credit Banks Funding Corporation. "Credit
quality remains solid and System institutions remain well capitalized."
Combined net income increased $160 million or 3.4% for the year ended December 31, 2016, as compared with the prior year. The increase resulted primarily from an increase in net interest income of $432 million and a decrease in the provision for income
taxes of $22 million, partially offset by increases in the provision for loan losses of $160 million and noninterest expense of $99 million and a decrease in noninterest income of $35 million. Net interest income increased 6.2% to $7.4 billion for 2016, as
compared with $7.0 billion for the prior year.
The increase in net interest income resulted from a higher level of average earning assets, partially offset by a lower net interest spread. Average earning assets grew $24.7 billion or 9.0% to $299.6 billion for 2016, as compared with the prior year. Net interest
margin decreased six basis points to 2.49% for 2016, as compared with 2.55% for 2015. The decline in the net interest margin was due to a decrease in the net interest spread of nine basis points to 2.31% for 2016, as compared with 2.40% for 2015.
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