RIDGELAND — Southern AgCredit, a rural lending cooperative, recently returned a record level of net earnings to its customer-owners in Mississippi and Louisiana.
This marks the 18th consecutive year of the co-op’s patronage program.
Southern AgCredit customers received a check for their portion of the $7.2 million cash patronage, plus a statement detailing their share of a $7.5 million patronage allocation that is eligible for future payment in cash. The combined $14.7 million patronage surpasses the record patronage set by the lending organization last year.
Joe Hayman, Southern AgCredit CEO, said, “We are pleased that our cooperative has the financial strength to provide this patronage refund to our customers, who collectively own the business. We are committed to sharing our earnings with them, thereby reducing the effective interest rate on their loans. On average, this distribution amounts to approximately a 1.00 percent rate reduction.”
Every year, the Southern AgCredit Board of Directors reviews the association’s financial position and determines how much of the net earnings can be returned as a patronage. This year, the board approved 98 percent of net earnings to be paid as patronage in the form of 48 percent cash and 50 percent allocated equities. Borrowers are not taxed on allocated equity funds until the funds are paid to them in cash.
Southern AgCredit is a full-service cooperative lender specializing in financing rural land and agricultural operations in Mississippi and Louisiana. It is a member of the nationwide Farm Credit System, the nation’s single largest source of loans for agriculture, agribusiness, rural real estate and country homes.