Let’s Talk patronage! PATRONAGE, HOW IT WORKS When someone borrows money from AgCredit, they become a member of a local cooperative.
Members then make payments on their loans, which includes interest based upon competitive market rates.
AgCredit makes a profit from the interest members pay on their loans and from the other financial services offered.
LET’STALK TALK PATRONAGE! PATRONAGE! LET’S HOWDID DID WE WE OFFER HOW OFFERAA45% 45% RETURN THIS THIS YEAR? RETURN YEAR? 1. Profitability—We were fortunate to achieve a
1. Profitability—We were fortunate to achieve a net income of $55.1 million in 2019, including net income of $55.1 in 2019, including a special $9.5 millionmillion patronage distribution a from special million patronage our$9.5 funding bank, AgFirst. distribution from our funding bank, AgFirst. 2. Rate of Loan Growth—Low growth in 2019
2. Rate of that Loanthe Growth—Low growth in 2019 meant Association didn’t need to meant the Association didn’t need to retainthat as much income to capitalize growth. retain as much income to capitalize growth.
3. Financial Strength—Being financially sound ensures that we can continue to serve our 3. Financial Strength—Being financially sound mission at a high level today and be here for ensures that we can continue to serve our future generations tomorrow. mission at a high level today and be here for
future generations tomorrow.
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Upon determining that the financial position is sound, the board can decide to return a portion of AgCredit’s profits back to the members.
RETURNED MEAN?
Members received 45 cents back on every dollar of interest paid in 2019. Members 45 cents back every Loan ratesreceived were lowered by 45% onon eligible paid inof2019. loansdollar whichof is interest the equivalent lowering a Loan rates were lowered by 45% 5% loan rate to 2.75%. on eligible
loans which is the equivalent of lowering a IT PAYS TO BE A to MEMBER 5% loan rate 2.75%. OF
TIONS IBU
AGCREDIT!
Members receive patronage checks based on the amount of interest they accrued on their loans. This lowers their total cost on the already competitive loans.
IT PAYS TO BE A MEMBER OF AGCREDIT! AgCredit.net
$ 41 Million
AgCredit distributed over $41 million to its members in 2020.
AgCredit.net
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AGCREDIT LEADER APRIL 2020
The board of directors, which is elected by the members, looks at AgCredit’s financial position.
WHAT DOES 45% WHAT DOES 45% RETURNED MEAN?
