April 8, 2021 |Patronage
Texas Farm Credit customers are getting cash back this spring — the highest amount in the lender’s history — for the 23rd year in a row.
The rural lending cooperative is distributing a record $14.1 million in patronage dividends to its customers. About 4,000 checks are going out across its 100-county territory.
Patronage lowers borrowing costs by refunding a portion of the interest customers paid on their loans the previous year.
On average, a Texas Farm Credit borrower who had a 5.0% interest rate in 2020 effectively paid less than 4.0% as a result of the April patronage dividend. The cooperative also allocated another $7.0 million of its 2020 earnings to members for future distribution, which will decrease their borrowing costs even more.
“Each success reflects the confidence our customers have in us. We remain grateful they chose us for their financing needs,” said Mark Miller, Texas Farm Credit chief executive officer.
“Amid a tough year for many in agriculture, it was more important than ever to reinforce one of our key priorities — delivering the best customer experience. Texas Farm Credit emerged as an even stronger company, positioned to create greater value for our customers.”
Commitment to Its Owners Led to a Solid Year
Texas Farm Credit’s earnings totaled $34.2 million in 2020, a record year for net earnings. It exceeded the financial projections in its business plan by more than $4.2 million. The lending co-op finished the year with $1.6 billion in assets and its highest new loan volume ever. Credit quality remained strong, with 97.9% of loans classified as acceptable or special mention.
The more the cooperative earns, the more it returns to borrowers through its patronage program. In 2020, the rural lending co-op distributed $19.0 million in cash to its customers: a portion of its 2019 earnings in April, followed in December by earnings that had been retained as capital in 2012 to fund growth.
About Texas Farm Credit
Texas Farm Credit is an agricultural lending cooperative that provides competitive rates, flexible terms, and personal service to farmers, ranchers, rural residents, and agribusiness firms from the Red River to the Rio Grande Valley. Not only does Texas Farm Credit finance a wide range of farming and ranching operations, it also offers home and rural real estate mortgage loans, as well as provides a variety of insurance services to its members. Headquartered in Robstown, Texas, the lending co-op serves 100 Texas counties and is part of the Farm Credit System, a nationwide network of rural lending co-ops established in 1916.
We Are Texas Farm Credit
As part of the nationwide Farm Credit System, we are here for rural communities from the Red River to the Rio Grande Valley. Find out more about who we are and how we serve our members.Read Our Story