Third quarter net income for Yankee Farm Credit was $1.9 million, an increase of $331 thousand over 2011. Net interest income increased 6.0 percent to $3.1 million, up from $2.9 million in 2011. The most significant factors driving the increase in net income are increases in loan volume, fees for financial services, and a decrease in the provision for credit losses.
For the first nine months of 2012, net income increased 19.0 percent to $6.4 million, up from $5.4 million a year ago. Net interest income increased 4.1 percent to $9.1 million. There was a provision for credit losses of $151 thousand through the third quarter of 2012, as compared to $317 thousand for the same period in 2011. Other income increased by $677 thousand, primarily due to $393 thousand in refunds from the Farm Credit System Insurance Corporation (FCSIC).
Loans held by the Association at September 30, 2012 were $362.9 million, up 6.7 percent from year end. The loan portfolio continues to be concentrated in the dairy industry, with 55.3 percent of the loans invested in dairy businesses. The second largest concentration is timber, with 11.5 percent of the loan volume at quarter-end.
Credit quality across Yankee’s loan portfolio improved during the quarter and was well within the risk-bearing capacity of the Association. At quarter end 1.6 percent of the Association loans were classified as nonperforming, no change from at the end of 2011. There were no loan charge-offs or recoveries in the quarter. The Association’s permanent capital ratio at quarter-end was 20.4%, down 0.2% from the end of 2011.
