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1 1 (July 08, 2020)

handle is hein.crs/govdasd0001 and id is 1 raw text is: Farmer Mac and Its Board Members The Federal Agricultural Mortgage Corporation (Farmer Mac) is a secondary market for agricultural mortgages. It purchases loans from originating lenders and provides other risk management tools to facilitate the agricultural lending market. It was created by Congress as a privately funded government-sponsored enterprise (GSE) similar to the housing GSEs such as Fannie Mae. Farmer Mac is governed by a 15-member board of directors, five of whom are nominated by the President and confirmed by the Senate. In December 2019, the Senate confirmed a new board member, LaJuana Wilcher, who was named chairperson of the board. In January 2020, President Trump nominated Charles Stones for another board position that remains pending. Congressional oversight is provided by the House and Senate Agriculture Committees, which have primary jurisdiction for the Farmer Mac statutes. Farmer Mac was established in the Agricultural Credit Act of 1987 (P.L. 100-233, Title VII) as a secondary market for agricultural loans. It purchases and pools qualified loans and may sell them to investors as securities or hold them in its own portfolio. It provides risk management tools to originating lenders that let them make more loans to agricultural borrowers and satisfy regulatory requirements. Statutorily, Farmer Mac is part of the Farm Credit System (FCS) and is codified in the Farm Credit Act of 1971 (12 U.S.C. §2279aa; see CRS Report RS21278, Farm Credit System). Financially and corporately, however, Farmer Mac is a separate entity from the FCS. Each has no liability for any of the others' debt. Administratively, Farmer Mac and the FCS have the same federal regulator the Farm Credit Administration (see CRS In Focus IF10767, Farm Credit Administration and Its Board Members). Farmer Mac is an investor-owned corporation, not a member-owned cooperative like the FCS. Two classes of voting stock exist for (1) banks and insurance companies and (2) the FCS. Any investor may own nonvoting stock. As an independent entity, Farmer Mac is not supported by congressional appropriations and is not part of the U.S. Department of Agriculture (USDA). Farmer Mac operates in four primary lines of business: farm and ranch, USDA guarantees, rural utilities, and institutional credit. In the farm and ranch business line, most activity is from Farmer Mac promising to buy specific agricultural mortgages under future adverse conditions by selling long-term standby purchase agreements to financial institutions. The purchase agreements guarantee loans against default risk, while the originating lender retains interest rate risk and loan servicing responsibilities. In the guarantee line, Farmer Mac purchases the portion of loans that are guaranteed by USDA, thereby accepting the interest rate risk but carrying no default risk. The rural utilities business line involves mostly loans to rural electric cooperatives. The institutional credit portion supports the general obligations of eligible financial institutions, defined as having borrowers and portfolios that are eligible for other Farmer Mac business. At the end of 2019, Farmer Mac's total business volume (similar to assets) was $21 billion, up 7% over 2018. The largest share of Farmer Mac's business (nearly half) is in institutional credit, followed by farm and ranch, USDA guarantees, and rural utilities. Its core earnings (that exclude the effects of valuation fluctuations and infrequent or unusual transactions) was $94 million in 2019, up 12% over 2018. B Sar-dMe bes Congress prescribes a 15-member board of directors for Farmer Mac (12 U.S.C. §2279aa-2). Five are presidentially appointed and Senate confirmed, five are elected by stockholders to represent banks and insurance companies, and five are elected by other stockholders to represent the FCS. For the five presidentially appointed and Senate-confirmed board members, the statute does not specify a term length but says that such board members serve at the pleasure of the President. The President names one of the appointees to be chairperson of the board (12 U.S.C. §2279aa-2 (a); Table 1). Table I. Presidentially Appointed Members of the Farmer Mac Board of Directors Name Description LaJuana Wilcher Chairperson. Confirmed in 2019. Lowell Junkins Vice-chairman. Confirmed in 1996. Sara Faivre Confirmed in 2010. Myles Watts Confirmed in 2010. Bruce Sherrick Confirmed in 2012. Source: CRS, using data at Farmermac.com and Congress.gov (accessed July 7, 2020). Note: Ordered by officers and seniority. K~:> July 8, 2020 p\w -- , gnom goo mppm qq\ a , q 'S I 11LINUALiN,

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