CFC 1st Quarter: Two Transactions Add to Liquidity

CFC's fiscal year 2006 first quarter ended August 31 and CFC filed its 10-Q report with the Securities and Exchange Commission on Monday, October 17. According to CFO Steven Lilly, two first-quater transactions with new funding sources add to CFC liquidity:

• $500 million private note placement to Farmer Mac
• 450 million in initial advances from government guarantee bond program (fees will provide additional funding for USDA Rural Economic Development Loan and Grant (REDL&G) Program)

Additional highlights included:

• Telecommunications loans declined by $691 million. CFC has strategically reduced the size of the telecommunications portfolio from 27 percent of gross loans to less than one half of that amount in the span of a few years.
• Adjusted debt-to-equity ratio has declined to 5.95-to-1 versus 6.07-to-1 at prior year-end.
• Adjusted TIER was 1.15, above target.
• The loan loss reserve totaled $590 million, representing 3.24 percent of gross loans.
• Operating income for the quarter: $247.4 million.
• Adjusted gross margins: $34.8 million.
• General and Administrative expenses: $10.6 million, on track to meet budget.
• Adjusted net margins: $31.9 million.
• Secured loans to rural utilities continue to represent 92 percent of CFC’s loan portfolio; the 8 percent balance is outstanding unsecured loans to quality utility borrowers.

Click here to read CFC's First-Quarter 2006 10-Q report.

Note: The CFC 2005 Annual Report is now available online. The report covers FY2005: June 1, 2004 through May 31, 2005.