Patronage Dividends = Cash Back

AgTrust Farm Credit follows the fundamental cooperative principle of sharing success with its customer-owners in the form of patronage when it does well. Thus, a patronage dividend is a means of allocating a portion of patronage sourced earnings – minus operating expenses and necessary reserves – to our customer-owners.  Annually, the board of directors evaluates the Association’s financial performance, considers long term capital needs, and may declare a patronage dividend to be paid.  The patronage dividend can be in the form of cash, allocated surplus, stock or any combination of these.  AgTrust Farm Credit has well established history of paying an all-cash patronage dividend.

Owning stock or participation certificates may make you eligible to receive patronage dividends.  Exclusions from patronage eligibility are determined by the board of directors annually and include: (a) all loans with the borrower when any loan with such borrower has a charge-off in whole or in part that has not been fully recovered; (b) a loan that is in non-interest earning status, as designated by the Association, as of the end of the year; (c) a loan that was designated by the Association as being in non-interest earning status and was not fully restored to accrual status or was liquidated prior to year-end at an amount less than the full balance owed unless such loan is current and has contributed to interest income on a cash basis; (d) a loan for which the borrower has declared Chapter 7 bankruptcy and, as of the end of the year or as of the time the cash patronage checks are issued, has not reaffirmed the debt or has reaffirmed the debt on terms other than those set forth in the loan documents; (e) a loan for which the borrower has declared bankruptcy and, as of the end of the year or as of the time the cash patronage checks are issued, is not operating under a confirmed plan or is operating under a confirmed plan that modified the terms of the loan documents; and (f) any advances or extensions in connection with debtor-in-possession financing.

Each customer owner’s patronage dividend; unless subject to applicable contractual limitations, is based on their economic contribution to AgTrust Farm Credit’s earnings. In other words, the proportion of interest earned on your loan to the total interest earned by us. Thus, the more you contribute to AgTrust Farm Credit the larger your potential patronage dividend.