Key Takeaways
- Farmer Mac completed a $313.5 million securitization backed by 343 agricultural mortgage loans.
- The transaction included a $290 million senior tranche guaranteed by Farmer Mac and a $23.5 million unguaranteed subordinate tranche.
- Multiple senior note classes (A, A-1, A-2) were introduced to broaden investor options and demand.
- Leadership noted continued strong institutional appetite for agricultural assets despite macroeconomic volatility.
- Farmer Mac plans to introduce a new credit transfer product in 2026 to support investor interest.
Farmer Mac Finalizes Seventh Agricultural Mortgage-Backed Securitization
The Federal Agricultural Mortgage Corporation, known as Farmer Mac, has completed a $313.5 million securitization of agricultural mortgage loans, marking the organization’s seventh transaction under its agricultural mortgage-backed securities platform. The securitization supports Farmer Mac’s mandate to enhance credit accessibility and liquidity across rural America.
Farmer Mac Highlights Growing Investor Demand
Chief Executive Officer Brad Nordholm said the transaction reflects confidence in the company’s portfolio and the broader agricultural credit market.
“The successful completion of our seventh agricultural mortgage-backed securitization demonstrates our commitment to grow our securitization platform and support a vibrant and liquid AMBS market that is central to our core mission to improve credit accessibility in rural America,” Nordholm said. “This transaction reflects the strength of Farmer Mac's portfolio, as agricultural assets continue to generate significant institutional investor demand despite the volatile macroeconomic climate.”
The securitized pool includes 343 agricultural mortgage loans, totaling approximately $313.5 million, all underwritten to Farmer Mac’s established credit standards.
Expands Structure With Multi-Class Senior Notes
The FARM Series 2025-2 securitization features a $290 million senior tranche guaranteed by Farmer Mac, divided into three classes—A, A-1, and A-2—to meet varying investor preferences. A $23.5 million subordinate tranche was issued without a guarantee.
According to leadership, the multi-class structure enhanced investor participation and broadened distribution among institutional buyers.
“We are very pleased with the tremendous support we've seen for this program and look forward to exploring other credit risk transfer opportunities to grow our platform while continuing to deliver high-quality opportunities for our investors,” said Zack Carpenter, President and Chief Operating Officer. “We anticipate introducing a new product in the market next year that will support the strong investor demand for agricultural assets, while also remaining in alignment with our mission fulfillment.”
Supporting Institutions and Advisors
BofA Securities, Inc. and J.P. Morgan Securities LLC served as joint bookrunners on the transaction. Raymond James & Associates, CastleOak Securities, and Seaport Global Securities acted as selling group members. Dechert LLP advised Farmer Mac, while Morgan, Lewis & Bockius LLP advised the underwriting group.
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