Farm Credit West in 2020

TOTAL CAPITAL CET1 CAPITAL RATIO (NEW RATIO 1.1.17) CORE SURPLUS RATIO

Total capital at the end of 2020 was $2.4 billion compared to $2.3 billion at the end of 2019. Our primary capital ratio measurement is common equity tier 1 (CET1). The CET1 ratio was 13.9% at the end of 2020 compared to a CET1 ratio of 14.4% at the end of 2019. Both were well in excess of the regulatory capital requirements. Maintaining a strong capital position is critical to ensure that Farm Credit West will be protected from unexpected future losses and is prepared for future challenges. Our strong loan growth in 2020 required additional capitalization; and while our strong earnings contributed to capital, it enabled us to declare a special patronage, which negatively impacted our capital ratios.

EARNING ASSETS NONEARNING ASSETS

($ IN MILLIONS)

NET INCOME OPERATING EFFICIENCY RATIO

$0.242/$1.00 $0.256/$1.00 $0.263/$1.00 $0.277/$1.00 $0.274/$1.00

Net income for 2020 was $296 million as compared to $255 million in 2019. Net Income in 2020 was positively impacted by an increase in our net interest income due to strong growth and performance stability in our loan portfolio.

Operational efficiency for 2020 was 24.2%, meaning it cost Farm Credit West 24.2 cents in expense to earn $1 of revenue. This low efficiency ratio indicates our commitment to cost management, and the downward trend in operating expenses since 2016 is a testament to the wise management practices of the Farm Credit West team.

| $100 | $126 | $113 | $117 | $142

Earning assets grew to $11.9 billion by the end of 2020 from $10.6 billion at the end of 2019. Average earning assets were $10.9 billion for 2020 compared to $10.0 billion for 2019.

Asset Quality improved slightly to 95.6% non-adversely classified loans at year-end 2020 compared with 95.4% at the end of 2019. Additionally, nonaccrual loans and other property owned decreased to $99.6 million at the end of 2020 compared to $126.4 million at the end of 2019.