Farmer Mac reported fourth‑quarter 2025 results that included net interest income of $104.5 million, up 12% from $93.4 million a year earlier, and a net effective spread of 101.4 basis points, a 16% increase from 87.5 basis points in the same period last year. Diluted earnings per share fell to $3.71, a 20% decline from $4.63 a year earlier, while diluted core earnings per share dropped 8% to $3.66 from $3.97. Full‑year diluted EPS rose modestly to $16.62 from $16.44, and core EPS increased 7% to $16.66 from $15.64. Outstanding business volume reached $33.4 billion, up $3.8 billion from the prior year.
The earnings miss was driven by higher credit provisions and borrower‑specific credit events that impacted core earnings in the fourth quarter. Elevated credit expenses and increased operating costs further eroded profitability, offsetting the revenue growth that the company achieved. Analysts had expected diluted EPS of $4.53–$4.57, so the $3.71 reported figure represented a miss of roughly $0.82, or about 18% below consensus.
Revenue for the quarter beat expectations, reaching $107.9 million versus the $107.45 million consensus estimate. The beat was largely powered by a shift in the portfolio mix toward renewable‑energy and broadband‑infrastructure loans, which command higher spreads. The company’s diversified portfolio continues to generate robust spreads, but the headwinds from credit provisions dampened the overall earnings impact.
The board increased the quarterly dividend to $1.60 per share, a 7% rise over the prior dividend, and declared the payment for March 31, 2026 to holders of record as of March 16, 2026. Liquidity stood at 277 days at December 31, 2025, and the Tier 1 capital ratio was 13.3%, both figures lower than the 317 days and 13.9% cited in the original article.
Chief Executive Officer Brad Nordholm said, "Farmer Mac delivered another strong year in 2025, highlighted by record net effective spread and outstanding business volumes, and our tenth consecutive year of record annual core earnings results." He added that isolated borrower‑specific credit events in the fourth quarter did not alter the company’s positive trajectory and that the firm remains well positioned to continue delivering value to rural America and shareholders.
Investors focused on the EPS miss and the impact of credit provisions, which tempered enthusiasm for the dividend increase. The market reaction reflected concern over the profitability shortfall, despite the company’s strong revenue performance and dividend growth record.
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