MidAtlantic Farm Credit, Maryland's largest agricultural lender, posted a healthy gain in earnings last year, and its borrowers shared in the wealth.
During its annual meeting with shareholders Tuesday night at the Best Western Hotel in Westminster, the cooperative bank announced that net income rose 52.6 percent to $25.35 million for the year that ended Dec. 31.
Gerri D. McGuire, senior vice president and chief financial officer, told the approximately 200 farmers in attendance that the earnings translated into $17.5 million in patronage refunds to borrowers, who are also stockholders of the bank.
It is currently distributing $5.2 million of the $17.5 million to shareholders. The remaining $12.3 million will be distributed at the end of five years.
McGuire pointed out that the bank's 9,000 shareholders have divided $11 million in patronage refunds since last year's annual meeting. This included a distribution of $5.8 million in November, which had been retained from 1995 earnings.
Donald Merryman, a veterinarian and grain farmer from Whiteford, who was with his wife, Joy, flashed the check in his coat pocket, smiled and said: "It's fun to go home with more money than you came with."
J. Robert Frazee, the bank's president and chief executive, said that the Westminster lender is part of a nationwide, cooperative banking system, owned by the farmers it serves. It was established in 1917 by Congress to provide farmers with a dependable lender to finance land purchases.
Frazee said he had "a happy story" to tell shareholders at this year's meeting.
He attributed last year's sharp rise in earnings in part to a $7.3 million cost in 2000 related to the merger of five regional banks - three in Maryland and one each in Delaware and Pennsylvania - that created MidAtlantic Farm Credit. "We didn't have that cost last year," he said.
Frazee said net loans rose 11 percent in 2001 to $1.1 billion, and that the bank added about 300 new members last year.
$100 million rise
Farm Credit ended 2001 with total assets of $1.2 billion, up from $1.1 billion at the end of 2000.
Despite a near 20-year low in grain prices, Frazee reported that the bank had only one foreclosure sale last year.
MidAtlantic Farm Credit is a part of AgFirst Farm Credit Bank, a Columbia, S.C.-based cooperative serving 15 Eastern states and Puerto Rico that was formed as a result of a 1995 merger between Farm Credit Bank of Baltimore and Farm Credit Bank of Columbia.
AgFirst reported net income of $130.6 million last year, up from $90 million in 2000.
It ended 2001 with $11.1 billion in loans outstanding, 17 percent higher than the previous year. Assets totaled $13.2 billion on Dec. 31, 11 percent higher than during the same period the previous year.