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Updated January 22, 2021
Farmer Mac and Its Board Members
Overview
that are backed by eligible loans and promises to buy
The Federal Agricultural Mortgage Corporation (Farmer
specific agricultural mortgages under future adverse
Mac) is a secondary market for agricultural mortgages. It
conditions by selling “long-term standby purchase
purchases loans from originating lenders and provides other
commitments” to financial institutions. The purchase
risk management tools to facilitate the agricultural lending
commitments guarantee loans against default risk, while the
market. It was created by Congress as a privately funded
originating lender retains interest rate risk and loan
government-sponsored enterprise (GSE) similar to the
servicing responsibilities.
housing GSEs such as Fannie Mae.
In the guarantee line, Farmer Mac purchases the portion of
Farmer Mac is governed by a 15-member board of
loans that are guaranteed by USDA, thereby accepting the
directors, five of whom are nominated by the President and
interest rate risk but carrying no default risk. The rural
confirmed by the Senate. The Senate confirmed two board
utilities business line involves mostly loans to rural electric
members during the Trump Administration: Charles Stones
cooperatives. The institutional credit portion supports the
in December 2020 and LaJuana Wilcher in December 2019,
general obligations of eligible financial institutions, defined
the latter named as chair of the board. No nominations are
as having borrowers and portfolios that are eligible for
pending.
other Farmer Mac business.
Congressional oversight is provided by the House and
As of September 30, 2020, Farmer Mac’s total business
Senate Agriculture Committees , which have primary
volume (similar to assets) was $22 billion, up 4% in nine
jurisdiction for the Farmer Mac statutes.
months since the end of 2019. The largest share of Farmer
Mac’s business (nearly half) is in institutional credit,
Farmer Mac
followed by farm and ranch, USDA guarantees, and rural
Farmer Mac was established in the Agricultural Credit Act
utilities. Its core earnings (that exclude the effects of
of 1987 (P.L. 100-233, Title VII) as a secondary market for
valuation fluctuations and infrequent or unusual
agricultural loans. It purchases and pools qualified loans
transactions) was $74 million for the first nine months of
and may sell them to investors as securities or hold them in
2020, up 7% over the same period in 2019.
its own portfolio. It provides risk management tools to
originating lenders that let them make more loans to
Board Members
agricultural borrowers and satisfy regulatory requirements.
Congress prescribes a 15-member board of directors (12
U.S.C. §2279aa-2). Five are presidentially appointed and
Statutorily, Farmer Mac is codified in the Farm Credit Act
Senate confirmed, five are elected by stockholders to
of 1971 (12 U.S.C. §2279aa) with the Farm Credit System
represent banks and insurance companies, and five are
(FCS; see CRS Report RS21278, Farm Credit System).
elected by other stockholders to represent the FCS.
Financially and corporately, however, Farmer Mac is a
separate entity from the FCS. Each has no liability for any
Five Presidential y Appointed and Senate
of the others’ debt. Administratively, Farmer Mac and the
Confirmed
FCS have the same federal regulator—the Farm Credit
For the five presidentially appointed and Senate-confirmed
Administration (see CRS In Focus IF10767, Farm Credit
members (Table 1), statute does not specify a term length
Administration and Its Board Members).
but says that such board members serve at the pleasure of
the President. The President names one of the appointees to
Farmer Mac is an investor-owned corporation, not a
be chair of the board (12 U.S.C. §2279aa-2 (a).
member-owned cooperative like the FCS. Two classes of
voting stock exist for (1) banks and insurance companies
and (2) the FCS. Any investor may own nonvoting stock.
As an independent entity, Farmer Mac is not supported by
congressional appropriations and is not part of the U.S.
Department of Agriculture (USDA).
Farmer Mac operates in four primary lines of business:
farm and ranch, USDA guarantees, rural utilities, and
institutional credit. In the farm and ranch business line,
most activity is from Farmer Mac purchasing and retaining
eligible agricultural mortgage loans. In that line of business,
Farmer Mac also guarantees securities held by third parties
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Farmer Mac and Its Board Members
Table 1. Presidentially Appointed Members of the
former chair, was named vice-chair in 2019. Other
Farmer Mac Board of Directors
presidentially appointed board members include Sara Faivre
(confirmed in 2010), Myles Watts (confirmed in 2010), and
Name
Description
Charles Stones (confirmed in 2020).
LaJuana Wilcher
Chair. Confirmed in 2019.
For the statutory requirement that not more than three of the
Lowel Junkins
Vice-chair. Confirmed in 1996.
presidential appointees be of the same political party, three
are affiliated with the Republican Party (Wilcher, Watts,
Sara Faivre
Confirmed in 2010.
and Stones) and two with the Democratic Party (Junkins
Myles Watts
Confirmed in 2010.
and Faivre).
Charles Stones
Confirmed in 2020.
Figure 1 is a timeline showing the service of the
Source: CRS, using data at Farmermac.com and Congress.gov
presidentially appointed board members of Farmer Mac
(accessed January 21, 2021).
since its inception in 1988.
The presidential appointees are to represent the general
Ten Elected Representing Banks and Farm Credit
public and may not have been officers or directors of
System
financial institutions. Not more than three may be of the
The other 10 members on the Farmer Mac board that
same political party, and at least two shall be farmers or
represent commercial banks and the FCS are elected to one-
ranchers (12 U.S.C. §2279aa-2 (a)(2)(C)(i)-(iv)).
year terms by the shareholders of the respective classes of
stock (12 U.S.C. §2279aa-2 (a)(5)). They may serve until
Nominations for the Farmer Mac board are considered in
their successors take office and may be reelected. Statute
the Senate to be privileged nominations, making them
expresses no other qualifications.
subject to special procedures that may streamline their
consideration (CRS Report R46273, Consideration of
The Code of Federal Regulations (12 C.F.R. 651)
Privileged Nominations in the Senate).
prescribes a “Code of Business Conduct and Ethics” for
Farmer Mac. This code states that the board may
The current slate of presidential appointees includes
recommend to the President that a presidential appointee on
LaJuana Wilcher (confirmed in 2019), whom President
the Farmer Mac board be removed if the board determines
Trump designated as chair of the board. Lowell Junkins, the
that the member has violated the code.
Figure 1. Presidentially Appointed Members of the Farmer Mac Board of Directors, 1988-2021
Source: CRS, compiled using data from Senate Agriculture Committee, “Nominations,” and Congress.gov (accessed January 21, 2021).
IF11595
Jim Monke, Specialist in Agricultural Policy
https://crsreports.congress.gov
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
been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the
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https://crsreports.congress.gov | IF11595 · VERSION 4 · UPDATED