FEDERAL AGRICULTURAL MORTGAGE CORPAGM
FEDERAL AGRICULTURAL MORTGAGE CORP Fair Value Disclosure
FAIR VALUE DISCLOSURES
Fair Value Classification and Transfers
The following tables present information about Farmer Mac's assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 and 2024, respectively, and indicate the fair value hierarchy of the valuation techniques used by Farmer Mac to determine such fair value:
Table 11.1
Assets and Liabilities Measured at Fair Value as of December 31, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3(1) | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||
Government/GSE guaranteed mortgage-backed securities | $ | — | $ | 5,297,018 | $ | — | $ | 5,297,018 | |||||||||||||||
U.S. Treasuries | 1,544,147 | — | — | 1,544,147 | |||||||||||||||||||
| AgVantage | — | — | 6,730,917 | 6,730,917 | |||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | — | — | 8,203 | 8,203 | |||||||||||||||||||
| Total Available-for-sale Investment Securities | 1,544,147 | 5,297,018 | 6,739,120 | 13,580,285 | |||||||||||||||||||
| Financial derivatives | 154 | 44,721 | — | 44,875 | |||||||||||||||||||
Other Assets(2) | — | — | 4,897 | 4,897 | |||||||||||||||||||
| Total Assets at fair value | $ | 1,544,301 | $ | 5,341,739 | $ | 6,744,017 | $ | 13,630,057 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Financial derivatives | $ | 15 | $ | 21,603 | $ | — | $ | 21,618 | |||||||||||||||
| Total Liabilities at fair value | $ | 15 | $ | 21,603 | $ | — | $ | 21,618 | |||||||||||||||
(1) Level 3 assets represent 19% of total assets and 49% of financial instruments measured at fair value.
(2) Represents a retained beneficial interest related to transfers of financial assets.
Assets and Liabilities Measured at Fair Value as of December 31, 2024 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3(1) | Total | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||
Auction-rate certificates backed by Government guaranteed student loans | $ | — | $ | — | $ | 19,476 | $ | 19,476 | |||||||||||||||
Government/GSE guaranteed mortgage-backed securities | — | 4,643,692 | — | 4,643,692 | |||||||||||||||||||
U.S. Treasuries | 1,289,846 | — | — | 1,289,846 | |||||||||||||||||||
| AgVantage | — | — | 5,505,531 | 5,505,531 | |||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | — | — | 9,015 | 9,015 | |||||||||||||||||||
| Total Available-for-sale Investment Securities | 1,289,846 | 4,643,692 | 5,534,022 | 11,467,560 | |||||||||||||||||||
Loans: | |||||||||||||||||||||||
| Loans held for sale, at lower of cost or fair value | — | 6,160 | — | 6,160 | |||||||||||||||||||
Total Loans | — | 6,160 | — | 6,160 | |||||||||||||||||||
| Financial derivatives | 47 | 27,742 | — | 27,789 | |||||||||||||||||||
Other Assets(2) | — | — | 5,382 | 5,382 | |||||||||||||||||||
| Total Assets at fair value | $ | 1,289,893 | $ | 4,677,594 | $ | 5,539,404 | $ | 11,506,891 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Financial derivatives | $ | — | $ | 77,326 | $ | — | $ | 77,326 | |||||||||||||||
| Total Liabilities at fair value | $ | — | $ | 77,326 | $ | — | $ | 77,326 | |||||||||||||||
(1) Level 3 assets represent 18% of total assets and 48% of financial instruments measured at fair value.
(2) Represents a retained beneficial interest related to transfers of financial assets.
There were no material assets or liabilities measured at fair value on a non-recurring basis as of December 31, 2025 or 2024.
Transfers in and/or out of the different levels within the fair value hierarchy are based on the fair values of the assets and liabilities as of the beginning of the reporting period. During the years ended December 31, 2025 and 2024, there were no transfers within the fair value hierarchy.
The following tables present additional information about assets and liabilities measured at fair value on a recurring basis for which Farmer Mac has used significant unobservable inputs to determine fair value. Net transfers in and/or out of Level 3 are based on the fair values of the assets and liabilities as of the beginning of the reporting period. There were no liabilities measured at fair value using significant unobservable inputs during the years ended December 31, 2025, 2024, and 2023.
Table 11.2
Level 3 Assets and Liabilities Measured at Fair Value for the Year Ended December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | Purchases | Sales | Settlements | Allowance for Losses | Realized and unrealized (losses)/gains included in Income | Ending Balance | |||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||||||||
Auction-rate certificates backed by Government guaranteed student loans | $ | 19,476 | $ | — | $ | (19,537) | $ | — | $ | 27 | $ | (163) | $ | 197 | $ | — | |||||||||||||||||||||||||||||||
AgVantage | 5,505,531 | 2,013,475 | — | (923,198) | 106 | 130,539 | 4,464 | 6,730,917 | |||||||||||||||||||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | 9,015 | — | — | (670) | — | — | (142) | 8,203 | |||||||||||||||||||||||||||||||||||||||
| Total available-for-sale | 5,534,022 | 2,013,475 | (19,537) | (923,868) | 133 | 130,376 | 4,519 | 6,739,120 | |||||||||||||||||||||||||||||||||||||||
| Other Assets | 5,382 | — | — | (341) | — | (144) | — | 4,897 | |||||||||||||||||||||||||||||||||||||||
| Total Assets at fair value | $ | 5,539,404 | $ | 2,013,475 | $ | (19,537) | $ | (924,209) | $ | 133 | $ | 130,232 | $ | 4,519 | $ | 6,744,017 | |||||||||||||||||||||||||||||||
Level 3 Assets and Liabilities Measured at Fair Value for the Year Ended December 31, 2024 | |||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | Purchases | Settlements | Allowance for Losses | Realized and unrealized losses included in Income | Ending Balance | ||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||
Auction-rate certificates backed by Government guaranteed student loans | $ | 19,082 | $ | — | $ | — | $ | — | $ | — | $ | 394 | $ | 19,476 | |||||||||||||||||||||||||||
| AgVantage | 5,522,712 | 677,400 | (666,476) | 81 | (49,727) | 21,541 | 5,505,531 | ||||||||||||||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | 9,767 | — | (699) | — | — | (53) | 9,015 | ||||||||||||||||||||||||||||||||||
| Total available-for-sale | 5,551,561 | 677,400 | (667,175) | 81 | (49,727) | 21,882 | 5,534,022 | ||||||||||||||||||||||||||||||||||
| Other Assets | 5,831 | — | (343) | — | (106) | — | 5,382 | ||||||||||||||||||||||||||||||||||
| Total Assets at fair value | $ | 5,557,392 | $ | 677,400 | $ | (667,518) | $ | 81 | $ | (49,833) | $ | 21,882 | $ | 5,539,404 | |||||||||||||||||||||||||||
Level 3 Assets and Liabilities Measured at Fair Value for the Year Ended December 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
| Beginning Balance | Purchases | Settlements | Allowance for Losses | Realized and unrealized gains included in Income | Transfers Out(1) | Ending Balance | |||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| Recurring: | |||||||||||||||||||||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||||||||||||||
| Investment Securities: | |||||||||||||||||||||||||||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||||||||||||||||||||||||||
Auction-rate certificates backed by Government guaranteed student loans | $ | 19,027 | $ | — | $ | — | $ | 6 | $ | — | $ | 49 | $ | — | $ | 19,082 | |||||||||||||||||||||||||||||||
| AgVantage | 7,599,379 | 2,084,650 | (1,561,507) | 230 | 89,629 | (5,573) | (2,684,096) | 5,522,712 | |||||||||||||||||||||||||||||||||||||||
Interest-Only Farmer Mac Guaranteed Securities | 7,847 | — | (1,213) | — | — | 3,133 | — | 9,767 | |||||||||||||||||||||||||||||||||||||||
| Total available-for-sale | 7,626,253 | 2,084,650 | (1,562,720) | 236 | 89,629 | (2,391) | (2,684,096) | 5,551,561 | |||||||||||||||||||||||||||||||||||||||
| Other Assets | 4,467 | — | (590) | — | 1,954 | — | — | 5,831 | |||||||||||||||||||||||||||||||||||||||
| Total Assets at fair value | $ | 7,630,720 | $ | 2,084,650 | $ | (1,563,310) | $ | 236 | $ | 91,583 | $ | (2,391) | $ | (2,684,096) | $ | 5,557,392 | |||||||||||||||||||||||||||||||
(1) Includes $2.7 billion of AgVantage securities transferred from available-for-sale to held-to-maturity on July 1, 2023.
The following tables present additional information about the significant unobservable inputs, such as discount rates and constant prepayment rates ("CPR"), used in the fair value measurements categorized in Level 3 of the fair value hierarchy as of December 31, 2025 and 2024:
Table 11.3
| As of December 31, 2025 | ||||||||||||||||||||||||||
| Financial Instruments | Fair Value | Valuation Technique | Unobservable Input | Range (Weighted-Average) | ||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||
| AgVantage | $ | 6,730,917 | Discounted cash flow | Discount rate | 4.3% - 4.9% (4.5%) | |||||||||||||||||||||
| Interest-Only Farmer Mac Guaranteed Securities | $ | 8,203 | Discounted cash flow | Discount rate | 7.8% | |||||||||||||||||||||
| CPR | 3% | |||||||||||||||||||||||||
| Other Assets | $ | 4,897 | Discounted cash flow | Discount rate | 7.8% | |||||||||||||||||||||
| CPR | 3% | |||||||||||||||||||||||||
As of December 31, 2024 | ||||||||||||||||||||||||||
| Financial Instruments | Fair Value | Valuation Technique | Unobservable Input | Range (Weighted-Average) | ||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||
Auction-rate certificates backed by Government guaranteed student loans | $ | 19,476 | Indicative bids | Range of broker quotes | 99.0% - 99.0% (99.0%) | |||||||||||||||||||||
| AgVantage | $ | 5,505,531 | Discounted cash flow | Discount rate | 5.0% - 5.5% (5.1%) | |||||||||||||||||||||
| Interest-Only Farmer Mac Guaranteed Securities | $ | 9,015 | Discounted cash flow | Discount rate | 7.9% | |||||||||||||||||||||
| CPR | 3% | |||||||||||||||||||||||||
| Other Assets | $ | 5,382 | Discounted cash flow | Discount rate | 7.9% | |||||||||||||||||||||
| CPR | 3% | |||||||||||||||||||||||||
The significant unobservable input used in the fair value measurements of AgVantage securities is the discount rate commensurate with the risks involved. Typically, significant increases (decreases) in this input in isolation may result in materially lower (higher) fair value measurements. Generally, in a rising interest rate environment, Farmer Mac would expect average discount rates to increase. Conversely, in a declining interest rate environment, Farmer Mac would expect average discount rates to decrease. CPR are not presented in the table above for AgVantage securities because they generally have fixed maturity dates when the secured general obligations are due and do not prepay.
Disclosures on Fair Value of Financial Instruments
The following table sets forth the estimated fair values and carrying values for financial assets, liabilities, and guarantees and commitments as of December 31, 2025 and 2024:
Table 11.4
| As of December 31, 2025 | As of December 31, 2024 | ||||||||||||||||||||||
| Fair Value | Carrying Amount | Fair Value | Carrying Amount | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Financial assets: | |||||||||||||||||||||||
| Cash and cash equivalents | $ | 931,067 | $ | 931,067 | $ | 1,024,007 | $ | 1,024,007 | |||||||||||||||
| Investment securities | 17,390,108 | 17,550,379 | 16,302,559 | 16,576,887 | |||||||||||||||||||
| Loans | 16,342,149 | 16,321,276 | 12,924,604 | 13,204,638 | |||||||||||||||||||
| Financial derivatives | 44,875 | 44,875 | 27,789 | 27,789 | |||||||||||||||||||
| Guarantee and commitment fees receivable | 63,677 | 57,214 | 57,562 | 50,499 | |||||||||||||||||||
| Financial liabilities: | |||||||||||||||||||||||
| Notes payable | 30,489,417 | 30,822,570 | 26,759,873 | 27,371,174 | |||||||||||||||||||
| Debt securities of consolidated trusts held by third parties | 2,420,149 | 2,365,435 | 1,910,302 | 1,929,628 | |||||||||||||||||||
| Financial derivatives | 21,618 | 21,618 | 77,326 | 77,326 | |||||||||||||||||||
| Guarantee and commitment obligations | 61,234 | 54,770 | 55,388 | 48,326 | |||||||||||||||||||
The carrying value of cash and cash equivalents is a reasonable estimate of their approximate fair value and is classified as Level 1. The fair value of investments in U.S. Treasuries are valued based on unadjusted quoted prices in active markets and are classified as Level 1. A significant portion of Farmer Mac's investment portfolio is valued using a reputable nationally recognized third-party pricing service. The prices obtained are non-binding and generally representative of recent market trades and are classified as Level 2.
Farmer Mac internally models the fair value of its portfolio assets; including loans held for investment and loans held for investment in consolidated trusts, Farmer Mac Guaranteed Securities, and USDA Securities by discounting the projected cash flows of these instruments at projected interest rates. The fair values are based on the present value of expected cash flows using management's best estimate of certain key assumptions, which include prepayment speeds, forward yield curves and discount rates commensurate with the risks involved. These fair value measurements do not take into consideration the fair value of the underlying property and are classified as Level 3. Level 3 Farmer Mac Guaranteed Securities include our AgVantage securities for which we apply a discount rate in calculating the net present value of future expected cash flows that is both significant to the estimate of their fair value and unobservable in the market. We rely upon this significant unobservable input to estimate the fair value of AgVantage because there are no observable transactions in these securities in the market.
Financial derivatives primarily are valued using the market standard methodology of netting the discounted future fixed cash payments (or receipts) and the discounted expected variable cash receipts (or payments) and are classified as Level 2. The fair value of the guarantee fees receivable/obligation and debt securities of consolidated trusts are estimated based on the present value of expected future cash flows of the underlying mortgage assets using management's best estimate of certain key assumptions, which include prepayments speeds, forward yield curves, and discount rates commensurate with the risks involved and are classified as Level 3. Notes payable are valued by discounting the expected cash flows of
these instruments using a yield curve derived from market prices observed for similar agency securities and are also classified as Level 3. Because the cash flows of Farmer Mac's financial instruments may be interest rate path dependent, estimated fair values and projected discount rates for Level 3 financial instruments are derived using a Monte Carlo simulation model. Different market assumptions and estimation methodologies could significantly affect estimated fair value amounts.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 25, 2020 | |
| 2018 | Feb 21, 2019 | |
| 2017 | Mar 8, 2018 | |
| 2016 | Mar 9, 2017 | |
| 2015 | Mar 10, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.