Funding Update 

for the 

Farm Credit System 
Recent Financial Headlines

“Why Realtors Have 

Embraced Brutal Honesty, 

Smells Like a Farmtown”

– Lots of Americans have relocated during the Covid-19 

pandemic, sometimes sight unseen. Real-estate agents 

are doing some truth-telling in advance.

2
Recent Financial Headlines

“U.S. National Debt 

Exceeds $30 Trillion for 

First Time”

 Increase from pre-pandemic levels fueled by trillions of 

dollars spent on aid programs for small businesses, 

workers and others.

3
Recent Financial Headlines

“U.S. Treasury Yields 

Rise After Positive Jobs 

Data ” 

– Move extends a recent climb in government 

bond yields.

4
Recent Financial Headlines

“U.S. Inflation 

Accelerates to 40-Year 

High”

– Consumer-price index rose at 7.5% annual rate in 

January

5
Recent Financial Headlines

“Bank of England Enacts 

First Back-to-Back Rate Rises 

Since 2004”

– Four of the rate-setting panel’s nine members 

wanted a bigger increase to tame inflation.

6
Recent Financial Headlines

“Treasury Yields Hit 2% 

After Inflation Data”

– Yields on shorter-term Treasuries led gain. 

7
Recent Financial Headlines

“As Inflation Soars, 

Central Banks Scramble to 

Lift Rates” – Bank of England raises rates while ECB leaves door 

open to tighter monetary policy; facing a ‘trade-off 

between strong inflation and weakening growth’

8
Recent Financial Headlines

“China’s Property Crisis 

Has Investors in Green 

Bonds Seeing Red”

– Chinese real-estate firms sold close to $10 billion of 

green bonds in 2021

9
Recent Financial Headlines

“Eurozone Inflation Climbs to 

Fresh High as Russian 

Invasion Confronts ECB With 

Dilemma” – Pickup in inflation driven by higher energy prices, with 

further increases likely

10
Recent Financial Headlines

“Oil Briefly Tops $115”

– European natural-gas prices rise as Russian ruble 

continues to fall

11
 Global Market 

 Agency Debt Market 

 Funding Corporation Activity

 Yields & Spreads on FCS Debt 

 FCS Liquidity

 LIBOR/SOFR

 War in Eastern Europe

12

Funding Update Topics 
 Federal Reserve

 E.C.B., Bank of England, Bank of Japan 

 U.S. Treasury

 China

 War in Eastern Europe 

13

Global Market 
 Assets – $ 436.0 billion (+ 8.8%)

 Loans – $ 343.9 billion (+ 9.0%)

 A.L.L. – $ 1.6 billion ( - 9.1%)

 Cash & Invts. – $ 80.8 billion (+ 8.9%)

 Capital – $ 69.5 billion (+ 6.0%)

 Net Income – $ 6.8 billion (+13.2%)

14

System High Level Financials 
Credit Rating Agencies -

Outlook for the United States

 Standard & Poors – AA+ 

Outlook – Stable

 Moody’s – Aaa

Outlook – Stable

 Fitch – AAA 

Outlook – Negative

15
Agency Debt Issuance

Source: Agency Websites

16

Billions of Dollars 2017 2018 2019 2020 2021

F.H.L.B. $2,499 $2,856 $2,739 $1,975 $1,467 

FCS 278 308 364 421 415 

Freddie Mac 480 413 558 465 22 

Fannie Mae 710 556 572 369 50 

Total $3,967 $4,133 $4,233 $3,230 $1,954 
Agency Debt Outstanding

Source: Agency Websites

17

Billions of Dollars 2017 2018 2019 2020 2021

F.H.L.B. $ 1,034 $1,044 $ 1,005 $ 737 $653 

FCS 265 280 292 322 353

Fannie Mae 278 204 158 275 202 

Freddie Mac 317 274 254 284 182

Farmer Mac 16 16 19 22 23 

Tenn. V.A. 25 23 22 21 21 

Total $1,935 $1,941 $1,750 $1,661 $1,434 
Source: FFCBFC Website

18

Funding Activity by FCS

($ millions) Discount Notes Designated 

Bonds

Fixed Rate Bonds Floating Rate Bonds Retail 

Bonds

Other1 Total

Callable NonCallableLIBOR SOFR Prime, 

FF, 91-

day, 

2/28/2022 22,734 11,100 110,407 98,981 1,916 86,517 30,062 19 148 361,883

12/31/2021 24,280 9,100 104,071 100,600 2,141 79,747 32,797 20 151 352,906

12/31/2020 23,524 3,100 78,971 90,084 39,437 56,595 29,712 42 148 322,464

12/31/2019 17,459 0 77,903 79,068 80,613 7,957 28,657 122 159 291,938

12/31/2011 13,647 21,450 46,429 43,986 36,155 0 21,461 356 66 183,549

1 Includes Linked Deposits
19

Designated Bonds

• GSE Benchmark Issue

• Six Issuances in 2021 

• $1 Billion, 2 & 3 yr. Maturities

• Barclays Aggregate Bond Index

• Dealer Performance/Investor Base 
20

Designated Bond
Dealer Group 

• 37 Dealer Group Members

• MFR Securities, Inc. added in Jan. ‘22

– Leveraging Equality and Diversity (LEAD)

– 9 Overall LEAD Dealer Members 

21
FCS Debt Yields Increasing

22
Recent FCS Debt Yields 

23
Increased Risk Premiums

24
Recent Risk Premiums

25
 Calls in ‘21 – $ 35 billion

 Calls in ‘20 – $ 115 billion

 Calls in ‘19 – $ 54 million

 Calls in ‘18 – $ 29 billion

 Calls in ‘17 – $ 5 billion

 Net Interest Spreads

 2.33% for ‘21, 2.26 % for ‘20, 2.04% for ‘19, 2.12% for ‘18, 

2.25% for ‘17. 

 Net Interest Margins

 2.46% for ‘21, 2.46 % for ‘20, 2.42% for ‘19, 2.46% for ‘18, 

2.48% for ‘17. 

26

Decreased Call Activity
 Weighted average maturity of FCS Debt

 Dec./2021 – 3.14 years

 Dec./2020 – 2.85 years

 Dec./2019 – 2.82 years

 Dec./2018 – 2.86 years

 Dec./2017 – 2.88 years

27

Debt Maturity 
 Percentage of FCS debt maturing within 1 year.

 Dec./2021 – 37.0 percent

 Dec./2020 – 38.8 percent

 Dec./2019 – 38.9 percent

 Dec./2018 – 38.8 percent

 Dec./2017 – 39.1 percent

28

Debt Maturity 
 As of 12/31/21 System = 180(174) days:

• AgFirst = 235(221) days, AgriBank = 158(146) 

days, FCB of TX = 185(173) days, CoBank = 

180(180)days 

 As of 12/31/20 System = 171 (158) days:

• AgFirst = 196(189) days, AgriBank = 167(136) 

days, FCB of TX = 182(173) days, CoBank = 

174(174) days 

29

Days of Liquidity 
 Global U.S. LIBOR referenced instruments still dominate. 

 16 mos. until ALL remaining LIBOR’s Tenors R.I.P. date.

 Secured Overnight Financing Rate growing quickly in use.

 System’s J & S LIBOR directly based debt down to $1.9 

billion. No new issues. Synthetic derivative exposure 

notional amount $44.3 billion versus $46.2 billion yearend 

’20. 

 FCS issued just over $46.2 billion in SOFR indexed 

bonds in 2021. Now dominates FCS indexed debt.

30

LIBOR/SOFR TRANSITION
Global Issue 

Major Economic Shocks 

Long Term Impacts

31

War in Eastern Europe
 Strong Demand for FCS Debt

 FCS Debt Yields Moving Higher 

 FCS Risk Premiums Rising but Still Favorable

 Solid Financial Performance Continuing

 Substantial Liquidity 

 LIBOR/SOFR Transition Progressing 

 War in Eastern Europe Global Impact

32

Summary