THE VALUE OF OWNERSHIP As a cooperative, a benefit of Farm Credit East members’ ownership includes a share in the association’s financial success. Farm Credit East’s continued financial strength has resulted in members receiving patronage payments for the last 25 consecutive years, as well as mid-year patronage payments this year as well as the past two years. Since the patronage program was first adopted, customers of Farm Credit East (and predecessor associations) have received $918 million in dividends from ownership of their cooperative.
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The association’s customer-owners are at the core of every business decision. For this reason, Farm Credit East strives to maintain competitive interest rates. The association’s pricing strategy is to adjust interest rates when there are changes in variable rate funding costs.
One of the Board’s guiding principles is maintaining the value of customer ownership. We’re fortunate to be part of a financially strong organization, and both the board and management remain committed to returning that value to customer owners through patronage dividends and competitive interest rates. – Board Chair Laurie Griffen Stillwater, N.Y.
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FEBRUARY $70 million patronage On average, eligible customers received about a 1.04% reduction in their effective interest rate.
APRIL Base variable interest rate pricing reduced by 1%
FEBRUARY
MAY
$65 million patronage On average, eligible customers received 20.5% of the interest paid in 2018.
Base variable interest rate pricing reduced by 0.25%
OCTOBER FEBRUARY $60 million patronage On average, eligible customers received 22.5% of the interest paid in 2017.
Base variable interest rate pricing reduced by 0.25% This reduction was in addition to movement in national interest rates influenced by the Federal Reserve.
JUNE Base variable interest rate pricing reduced by 0.25% This reduction followed the return of Farm Credit East’s cost of funding to its historical relationship with the Fed Funds rate.
JULY
OCTOBER
OCTOBER
$15 million special patronage This payment equated to about 11% of stockholders’ interest costs.
$25 million special patronage This payment equated to approximately 0.45% of eligible average customer loan volume.
$30 million patronage advance For the full year 2020, Farm Credit East is targeting patronage of 1.25% of average eligible loan volume, so members received an advance on that expected payment equal to about 0.50% of current loan volume for the average customer.
2018
2019
2020
