Company: AGM-PH
Filing Date: 2025-05-09
Form Type: 10-Q
Source: 0000845877-25-000152
Chunk: 236

Company: FEDERAL AGRICULTURAL MORTGAGE CORP
Filing Date: 2025-05-09
Form: 10-Q
Item: Part I, Item 2
Chunk 236
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 net interest income.

Table 2For the Three Months EndedMarch 31, 2025December 31, 2024March 31, 2024(in thousands)Net interest income$90,939 $93,368 $86,368 Net interest yield %1.15 %1.21 %1.15 %Net effective spread$89,990 $87,528 $83,044 Net effective spread %1.17 %1.16 %1.14 %

The $2.4 million sequential decrease in net interest income was primarily due to a $4.6 million decrease in the fair value of derivatives designated in fair value hedge accounting relationships (designated financial derivatives) and an increase of $0.6 million in funding costs. These factors were partially offset by a $2.8 million increase from net new business volume. In percentage terms, the sequential decrease was 0.06%, which was primarily attributable to the decrease in the fair value of designated financial derivatives.

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The $4.6 million year-over-year increase in net interest income for first quarter 2025 compared to first quarter 2024 was primarily attributable to a $6.4 million increase from net new business volume and a $0.6 million decrease in funding costs, partially offset by a $1.9 million decrease in the fair value of designated financial derivatives.

The $2.5 million sequential increase in net effective spread was primarily attributable to net new business volume. 

The $6.9 million year-over-year increase in net effective spread for first quarter 2025 compared to first quarter 2024 was primarily due to a $6.4 million increase from net new business volume and a $0.6 million decrease in funding costs. In percentage terms, the year-over-year increase of 0.03% was primarily attributable to the shift in the composition of new business volume towards higher-yielding assets.

For more information about Farmer Mac's use of net effective spread as a financial measure, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Use of Non-GAAP Measures." For a reconciliation of net interest income to net effective spread, see Table 10 in "Management's Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations—Net Interest Income."

Business Volume

Our outstanding business volume was $29.8 billion as of March 31, 2025, a