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July 8, 2020
Farmer Mac and Its Board Members
Overview
financial institutions. The purchase agreements guarantee
The Federal Agricultural Mortgage Corporation (Farmer
loans against default risk, while the originating lender
Mac) is a secondary market for agricultural mortgages. It
retains interest rate risk and loan servicing responsibilities.
purchases loans from originating lenders and provides other
In the guarantee line, Farmer Mac purchases the portion of
risk management tools to facilitate the agricultural lending
loans that are guaranteed by USDA, thereby accepting the
market. It was created by Congress as a privately funded
interest rate risk but carrying no default risk. The rural
government-sponsored enterprise (GSE) similar to the
utilities business line involves mostly loans to rural electric
housing GSEs such as Fannie Mae.
cooperatives. The institutional credit portion supports the
general obligations of eligible financial institutions, defined
Farmer Mac is governed by a 15-member board of
as having borrowers and portfolios that are eligible for
directors, five of whom are nominated by the President and
other Farmer Mac business.
confirmed by the Senate. In December 2019, the Senate
confirmed a new board member, LaJuana Wilcher, who was
At the end of 2019, Farmer Mac’s total business volume
named chairperson of the board. In January 2020, President
(similar to assets) was $21 billion, up 7% over 2018. The
Trump nominated Charles Stones for another board position
largest share of Farmer Mac’s business (nearly half) is in
that remains pending.
institutional credit, followed by farm and ranch, USDA
guarantees, and rural utilities. Its core earnings (that
Congressional oversight is provided by the House and
exclude the effects of valuation fluctuations and infrequent
Senate Agriculture Committees, which have primary
or unusual transactions) was $94 million in 2019, up 12%
jurisdiction for the Farmer Mac statutes.
over 2018.
Farmer Mac
Board Members
Farmer Mac was established in the Agricultural Credit Act
Congress prescribes a 15-member board of directors for
of 1987 (P.L. 100-233, Title VII) as a secondary market for
Farmer Mac (12 U.S.C. §2279aa-2). Five are presidentially
agricultural loans. It purchases and pools qualified loans
appointed and Senate confirmed, five are elected by
and may sell them to investors as securities or hold them in
stockholders to represent banks and insurance companies,
its own portfolio. It provides risk management tools to
and five are elected by other stockholders to represent the
originating lenders that let them make more loans to
FCS.
agricultural borrowers and satisfy regulatory requirements.
Five Presidentially Appointed and Senate
Statutorily, Farmer Mac is part of the Farm Credit System
Confirmed
(FCS) and is codified in the Farm Credit Act of 1971 (12
For the five presidentially appointed and Senate-confirmed
U.S.C. §2279aa; see CRS Report RS21278, Farm Credit
board members, the statute does not specify a term length
System). Financially and corporately, however, Farmer Mac
but says that such board members serve at the pleasure of
is a separate entity from the FCS. Each has no liability for
the President. The President names one of the appointees to
any of the others’ debt. Administratively, Farmer Mac and
be chairperson of the board (12 U.S.C. §2279aa-2 (a);
the FCS have the same federal regulator—the Farm Credit
Table 1).
Administration (see CRS In Focus IF10767, Farm Credit
Administration and Its Board Members).
Table 1. Presidentially Appointed Members of the
Farmer Mac Board of Directors
Farmer Mac is an investor-owned corporation, not a
member-owned cooperative like the FCS. Two classes of
Name
Description
voting stock exist for (1) banks and insurance companies
LaJuana Wilcher
Chairperson. Confirmed in 2019.
and (2) the FCS. Any investor may own nonvoting stock.
As an independent entity, Farmer Mac is not supported by
Lowell Junkins
Vice-chairman. Confirmed in 1996.
congressional appropriations and is not part of the U.S.
Sara Faivre
Confirmed in 2010.
Department of Agriculture (USDA).
Myles Watts
Confirmed in 2010.
Farmer Mac operates in four primary lines of business:
farm and ranch, USDA guarantees, rural utilities, and
Bruce Sherrick
Confirmed in 2012.
institutional credit. In the farm and ranch business line,
Source: CRS, using data at Farmermac.com and Congress.gov
most activity is from Farmer Mac promising to buy specific
(accessed July 7, 2020).
agricultural mortgages under future adverse conditions by
Note: Ordered by officers and seniority.
selling “long-term standby purchase agreements” to
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Farmer Mac and Its Board Members
The presidential appointees are to represent the general
A nominee, Charles Stones, is pending Senate action to
public and may not have been officers or directors of
replace Sherrick. President Trump nominated Stones in
financial institutions. Not more than three may be of the
January 2020 (PN1420).
same political party, and at least two shall be farmers or
ranchers (12 U.S.C. §2279aa-2 (a)(2)(C)(i)-(iv)).
Figure 1 is a timeline showing the service of the
presidentially appointed board members of Farmer Mac
The current slate of presidential appointees includes
since its inception.
LaJuana Wilcher (confirmed in 2019), whom President
Trump designated as chairperson of the board. Lowell
10 Elected Representing Banks and Farm Credit
Junkins, the former chairman, was named vice-chairman
System
and has served since his appointment in 1996. Other
The other 10 members on the Farmer Mac board that
presidentially appointed board members include Sara Faivre
represent commercial banks and the FCS are elected to one-
(confirmed in 2010), Myles Watts (confirmed in 2010), and
year terms by the shareholders of the respective classes of
Bruce Sherrick (confirmed in 2012).
stock (12 U.S.C. §2279aa-2 (a)(5)). They may serve until
their successors take office and may be reelected. Statute
For the statutory requirement that not more than three of the
expresses no other qualifications.
presidential appointees be of the same political party, three
are affiliated with the Republican Party (Wilcher, Watts,
The Code of Federal Regulations (12 C.F.R. 651)
and Sherrick) and two with the Democratic Party (Junkins
prescribes a “Code of Business Conduct and Ethics” for
and Faivre).
Farmer Mac. This code states that the board may
recommend to the President that a presidential appointee on
the Farmer Mac board be removed if the board determines
that the member has violated the code.
Figure 1. Presidentially Appointed Members of the Farmer Mac Board of Directors, 1988-2020
Source: CRS, compiled using data from Senate Agriculture Committee, “Nominations,” and Congress.gov (accessed July 7, 2020).
IF11595
Jim Monke, Specialist in Agricultural Policy
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Farmer Mac and Its Board Members
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
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