Company: AGM-PH
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0000845877-25-000033
Chunk: 187

Company: FEDERAL AGRICULTURAL MORTGAGE CORP
Filing Date: 2025-02-21
Form: 10-K
Item: Item 7
Chunk 187
---
.15 %$270,940 1.04 %Net effects of consolidated trusts(4,477)0.02 %(4,171)0.02 %(4,239)0.02 %Expense related to undesignated financial derivatives(1,377)— %(4,845)(0.02)%(7,756)(0.03)%Amortization of premiums/discounts on assets consolidated at fair value(29)— %(175)— %(24)— %Amortization of losses due to terminations or net settlements on financial derivatives3,128 0.01 %3,230 0.01 %2,413 0.01 %Fair value changes on fair value hedge relationships(11,548)(0.04)%5,394 0.02 %(5,805)(0.02)%Net effective spread$339,564 1.15 %$326,980 1.18 %$255,529 1.02 %

The $12.6 million year-over-year increase in net effective spread was primarily due to a $20.2 million increase from a shift in the composition of new business volume towards higher-yielding loans. This factor was partially offset by a $6.6 million decrease in cash-basis interest income and a $1.3 million increase in funding costs. In percentage terms, the year-over-year decrease of 0.03% was primarily attributable to an increase of 0.04% related to the increases in funding costs and a decrease of 0.02% in 

67

cash-basis interest income, which were partially offset by an increase of 0.03% on the shift in the composition of new business volume towards higher-yielding loans. 

For 2023 compared to 2022, the $71.5 million year-over-year increase in net effective spread was primarily due to a $54.6 million decrease in funding costs, due to our disciplined funding strategies and higher nominal interest rates that have led to an upward repricing of our excess capital that is held in our short-term investment portfolio, and a $20.6 million increase related to net new business volume. In percentage terms, the year-over-year increase of 0.16% was primarily attributable to a decrease in funding costs. 

See Note 14 to the consolidated financial statements for more information about net interest income and net effective spread from Farmer Mac's individual business