Q1 2012 Financial Results

Quarterly net income for Yankee was $2.1 million, an increase of $66 thousand over 2011. Net interest income increased 2.1 percent to $3.0 million, up from $2.9 million in 2011. The most significant factor driving the increase in net income was the provision for credit losses; which was $76 thousand lower in 2012 due to an improvement in credit quality. The decrease in the provision for credit losses was offset by a decrease of $17 thousand in other income and an increase in other expenses of $88 thousand.

Quarter-end loans held by the Association at March 31, 2012 were $337.4 million, up 2.7 percent from the prior year. The loan portfolio continues to be concentrated in the dairy industry, with 56.5 percent of the loans invested in dairy businesses. The second largest concentration is timber, with 12.5 percent of the loan volume at quarter-end.

Credit quality across Yankee’s loan portfolio improved slightly during the quarter and remained well within the risk-bearing capacity of the Association. At quarter-end 1.6 percent of the Association loans were classified as nonperforming, unchanged from the end of 2011. There were no loan charge-offs, but recoveries of $6 thousand in the quarter. The Association’s permanent capital ratio at quarter end was 20.7%, up from 20.6% at the end of 2011.

The 2011 patronage refund to members in the amount of $3.7 million was paid 100% in cash on March 23, 2012.

The complete quarterly report is available on our web site.

Rob Guay - Appraiser

I am pleased to announce that Rob Guay has earned the status of Certified General Real Estate Appraiser in Vermont.

The requirements to become a Certified General Real Estate Appraiser are daunting. They include 300 classroom hours in a rigorous training program developed by the Appraisal Qualifications Board, a board of The Appraisal Foundation, and administered by the individual states. Another requirement is 3,000 hours of supervised appraisal practice. The applicant must also pass a comprehensive final examination, in addition to tests in the various training sessions.

Rob completed his course work last fall and passed the comprehensive exam in January. On April 4th he completed the final step in the process, which was the acceptance of his appraisal practice hours by the Vermont Board of Real Estate Appraisers.

Rob started working for Yankee Farm Credit in the summer of 2008 and became an appraiser trainee in November 2008. He worked hard to become a licensed appraiser in just over three years.

Rob joins Liz Bayne and Geoff Yates as licensed appraisers in Yankee’s Appraisal Department. Special thanks to Vice President/Director-Appraisal Services Geoff Yates for mentoring Rob during his appraiser trainee period.

Congratulations, Rob, on this significant accomplishment!

800 Telephone Numbers

We have been experiencing problems with our 800 telephone numbers since Wednesday morning, April 25, 2012. Until the problem is resolved, please use our regular phone numbers if you need to call us:

802-388-2692 Middlebury
802-334-8050 Newport
802-524-2938 St. Albans
802-295-3670 White River Jct.
802-879-4700 Williston

We are working to resolve this problem as soon as possible. We apologize for the inconvenience.

UPDATE 4/27/12: The problem was resolved after the close of business today.

Board Officers and Committees

At the April 26, 2012 board meeting, the Board of Directors elected the following officers:

Chairperson – Rocklyn A. Giroux
Vice Chairperson – Alan J. Bourbeau

Also approved were committee assignments:

Executive Committee
Rocklyn A. Giroux, Chairperson
Alan J. Bourbeau
Bryan E. Davis
Walter M. Gladstone
Celeste Kane-Stebbins

Audit Committee
Rocki-Lee DeWitt, Chairperson
Thomas J. Colgan
Paul B. Franklin
Paul F. Saenger
Stephen H. Taylor

Compensation Committee
Celeste Kane-Stebbins, Chairperson
Rocki-Lee DeWitt
Walter M. Gladstone
Paul F. Saenger
Stephen H. Taylor

Membership/Governance Committee
Alan J. Bourbeau, Chairperson
Thomas J. Colgan
Bryan E. Davis
Paul B. Franklin
Bradley N. Maxwell

Director Election Results

The last of four annual meetings was held last night in Newport, VT. Members completed voting for directors, ballots were counted, and the results were announced before the meeting was adjourned. Elected to three year terms on the board of directors were:

Region 1 – Rocklyn Giroux 
Region 2 – Bradley Maxwell
Region 3 – Stephen Taylor

Congratulations to Rocky, Brad and Steve. And thanks to Bill Johnson and Scott Mitchell for participating in the elections as candidates. There were 151 ballots cast this year, which was 13% of eligible voters.

Thank you to everyone for participating, and a special thanks to employees for organizing and running successful meetings.

11th Annual Flavors of the Valley

April Smith, Credit Analyst, and Desi Smith, Office Assistant, attended the 11th Annual Flavors of the Valley on Sunday, April 15th at Hartford High School. Billed as the premier expo for locally grown food in the Upper Connecticut River Valley, this event, organized by Vital Communities featured approximately 53 vendors. This year’s site sponsors were Co-op Food Stores, Mascoma Savings Bank, Three Tomatoes Trattoria, Upper Valley Co-op, Edgewater Farm, Cedar Circle Farm, King Arthur Flour, and the New Hampshire Department of Agriculture, Markets and Food. The event was held from 11:00-3:00 and attended by over 1,000 people and provided the opportunity to meet local farmers and chefs, buy local food, as well as sample tasty tidbits.

This year's vendors included: Blue Ox Farm, Canaan Farmers Market, Cedar Circle Farm and Educational Center, Cedar Mountain Farm, Cobb Hill Cheese, Cherry Hill Farm, Community Garden at Enfield Shaker Museum, Co-op Food Stores, D Acres of New Hampshire, Edgewater Farm, Farm Plate, Flora Fauna Farm, Green Mountain Flour, Hogwash farm, Home Hill Inn and Restaurant, Hulbert Outdoor Center, Hasper Murdoch's Alehouse at Norwich Inn, Killdeer Farm, King Arthur Flour, Kingdom Creamery, Luna Bleu Farm, Mariam’s African Restaurant, NH Cheesemaker’s Guild, NH Dept. of Agriculture, NOFA-VT, Oak Wood Farm, One Chicken-at-a-time Farm, Ottauquechee Natural Resource Conservation District, Peach Blow Farm, Piermont Plant Pantry, Red Kite Candy Company, Rural Vermont, Springmore Farm, Sugarbush Cheese and Maple Farm, Taylor Brothers Farm, The Gardening Guy, Thompson Goat Farm, Three Tomatoes Trattoria, Transition Town White River Junction, Turkey Hill Farm, Upper Valley Farm to School Network, Upper Valley Food Co-op, Upper Valley Land Trust, Upper Valley Strong, Valley Food and Farm, Vermont Butter and Cheese Company, Vermont Chocolatiers, Vermont Farmstead Cheese Company, Vital Communities, Walpole Creamery, White River Junction Community Gardens

North American Intercollegiate Dairy Challenge

The North American Intercollegiate Dairy Challenge (NAIDC) holds four regional and one national contest each year. The 2012 national contest was held March 29-31 in Roanoke, VA (press release, photos). 128 students from 32 colleges participated in this annual event now in its 11th year. Jean Conklin, Senior Loan Officer and Tax Specialist from the White River Jct. office, attended as a National Board and Northeast Committee member.

NAIDC has helped prepare over 3,000 students for careers in the dairy industry. Farm Credit was a 5-star platinum sponsor of the 2012 national contest. The program is funded through the generous support of companies and producer associations serving the dairy industry, as well as a growing number of alumni and individual dairy farm owners.

Yankee's territory was well represented with students from UNH, UVM and Cornell. Cornell received a First Place Award.

Pictured above from Cornell University are:

Front: Daniel Durfee; Ariel Garland; Jordan Fisher.

Back: Coach Betsey Howland; Theodore Christoph; Coach Michael Van Amburgh.

(all names are listed left to right)

Pictured above from the University of Vermont are:

Front: Sarah Morrison; Abigail Scholten; Sheena Brown.

Back: Coach Wanda Emerich; Richard Brisson.

Pictured above from the University of New Hampshire are:

Front: Lindsay Peterson; Barbara Heins; Hannah Flint.

Back: Hannah Medico; Coach Peter Erickson.

UVM also participated in Aggregate Team #1:

Front: Margaret Quaassdorff, University of Vermont; Alison R. Crane, Berry College; Kenneth Sharp, Berry College.

Back: Coach Wanda Emerich, University of Vermont; Coach Lee Kilmer, Iowa State University; Ben Selman, Iowa State University; Coach Ben Wilson, Berry College.

Farm to Plate Appendix B - Dairy

On 2/10/12 the Vermont Sustainable Jobs Fund published Appendix B of the Farm to Plate Strategic Plan: Revitalizing Vermont's Dairy Industry. Click here for the link and scroll down. (Click here for an earlier post about Farm to Plate.) The appendix does a nice job of pulling together in one place a lot of information about Vermont's dairy industry.

One of the interesting things about the appendix is how it incorporates quotes from the 1976 report of the Governor's Commission on Food. So much of it still applies! Some of the issues affecting Vermont's dairy industry today go back even further, as evidenced by the booklet "This Milk Problem" published by UVM Extension in 1937.

Appendix B makes the following comment about financing today's dairy industry: “sufficient financing [for large dairy farms] is not available from one source.” We would not agree, as we provide all of the financing needs for many of Vermont’s largest dairy farms. I did a quick count (might have missed a few) and came up with loan commitments in excess of $100 million to 20 large dairy farms. That's an average of $5 million per farm. A few of those farms are in neighboring counties in New Hampshire and New York, but most are in Vermont.

There is no farm that we are unable to finance simply because it is too large.

UPDATE 4/19/12: Appendix B has been updated to include a discussion of Yankee Farm Credit's role in financing the dairy industry in Vermont. We appreciate the willingness of the Vermont Sustainable Jobs Fund to consider our comments.

FarmStart - Robbie Morrill

Yankee recently made a FarmStart investment to Robbie Morrill of Milton, Vermont. Robbie is a maple producer operating as R. Sweet Maples. (The t-shirt in the photo shows a maple tree with the caption "I'd tap that".)

Robbie, age 19, began at an early age setting up 900 taps on neighboring land and building a sugarhouse on his parent’s land. He has expanded to 4,000 taps on rented land for the 2012 season. He sells syrup both in bulk and retail. In 2011 he started producing maple coated nuts and maple cream for retail sales that he is selling at farmer's markets and school functions.

Robbie was voted the 2010-2011 Vermont "Maple King" which entails many public speaking appearances at maple events throughout the state – for example at the 2011 Governor’s Tree Tapping Ceremony. Robbie also works full time for CDL USA which is a maple sugaring equipment sales company in St. Albans.

Robbie put his business plan together needing "Seed Capital" to get to his current 4,000 tap level. This is where FarmStart came in. Robbie applied for a FarmStart investment to cover the cost of a new evaporator, expanded tubing system, and start-up costs for the 2012 season.

Loan Officer Thomas St. Pierre in the St. Albans office is Robbie’s FarmStart Advisor.

Tom Colgan

The Board of Directors has appointed Tom Colgan to replace Charlie Sniffen as a director.

Tom is President and CEO of Wagner Forest Management, Ltd. of Lyme, NH, a position he had held since 1994. He previously worked for Scott Paper Company in Maine. Tom holds forestry degrees from Duke University.

As noted in this post, Charlie is stepping down from the board. The Board of Directors started a process about a year ago to replace Charlie. While Yankee's second largest industry concentration is the timber industry, Yankee has never had a director from this industry. The board amended the bylaws so that the position held by Charlie could be held by either a non-member (i.e., an outside director such as Charlie) or a member who was appointed by the other directors. The Farm Credit Administration has encouraged institutions to use appointed directors to achieve desired diversity on the board. Tom is Yankee's first appointed director.

Tom's appointment is effective with the close of annual meetings in April. He plans to attend all four annual meetings to meet members. Tom, welcome aboard!