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NORMAL, ILL. – 1st Farm Credit Services
reports record volume in 2004 mortgages, according to Wayne
Gustafson, President and CEO. The results were shared during
the association’s annual meeting, held November 30, 2005 in
Normal.
“In 2004, our financial performance was strong with a return
on assets of more than 3 percent, well above our objective,”
he said. “Our earnings were twice than expected.”
The 2004 earnings of $51.9 million were affected by both a
one-time occurrence because the methodology for determining
the allowance for loan losses was revised. This resulted in
a significant reversal for loan losses allowance, which
increased capital. “The methodology 1st FCS now employs is
being used by all financial institutions and will result in
more transparency when results are published, which we
support,” said Gustafson.
In addition, 2004 showed additional demand for risk
management products, such as crop insurance. The income in
this market segment surpassed $4 million in 2004.
Gustafson also reported that the 2005 year activity, which
ends December 31, 2005, has shown strength as well. New
mortgage volume continues to increase, and the growth rate
of loans and leases is better than anticipated.
Gustafson looks to increased input costs and a low 2005 corn
crop as the leading hurdle Illinois producers will face in
2006. He also pointed out that farm real estate values from
2004 to 2005 increased more than 23 percent. “This is a
challenge to manage the way we lend on highly valued
properties,” he said.
1st Farm Credit Services is the leading provider of farm
real estate financing; operating loans; equipment and
building leasing and loans; farm appraisals; and a variety
of crop insurance products in the northern 42 counties of
Illinois. |
