annual report 2020 - yosemite farm credit, aca

ANNUAL REPORT

2020

YOSEMITE FARM CREDIT 2020 ANNUAL REPORT

MARK R. JENSENBoard Chair

A Message to our

Members

1

Yosemite Farm Credit places the needs of Members first. In times of uncertainty and volatility, wecontinue to offer stability and commitment. Unprecedented times call for a trusted partner that isresponsive and cares. Yosemite Farm Credit has risen to the occasion.

STABILITYOur Team remains dedicated and focused. We intentionally anticipate your needs and exceed yourexpectations. At the onset of the pandemic, our priority was determining how to continue servingMembers in an unparalleled environment. All services continued to be offered. Our Teams, althoughremote, were available and just a phone call away. We quickly became an approved Small BusinessAdministration lender and provided well over 200 Paycheck Protection Program (PPP) loans. We alsooffered a variety of loan accommodations to help Members offset operating challenges. We achieved arecord amount of new loan commitments, and our Team processed a record number of interest rateconversions to enable our Members to lock in historically low rates.

COMMITMENTThe Yosemite Farm Credit Team works to support your success. We are committed to providing aconsistent level of high-quality service, a knowledgeable and dependable Association team governedby a Board which is focused on member needs and understands local agriculture. Each farmingoperation is different, and each financing solution is customizable and unique. Our team of experts ishere to understand your operations, grow with you and remain committed to the success of your familiesand farms.

OPERATIONAL HIGHLIGHTS2020 was another strong year, reflecting our members’ strength and ability to manage through times ofuncertainty and volatility. Your ability to meet your loan obligations drive the success of your Association.The Association’s credit quality remains strong. While commodity prices softened for several of ourcommodities, land values remain strong.

The amount of loans outstanding at year-end increased 7.1% to approximately $3.4 billion. Net earningswere $59 million, a result of growing loan volume and controlled expenses. 2020 earnings enabled theAssociation to declare a patronage dividend of $25.4 million while continuing to provide competitiverates. Yosemite Farm Credit strives to be a good steward of your capital. The earnings we retain helpensure financial strength, build a foundation for future growth and provide safeguards against economicvolatility.

We look forward to working with Members in 2021. On behalf of the Board of Directors and theYosemite Farm Credit Team we thank you for the opportunity to serve you.

TRACY V. SPARKSPresident & Chief Executive Officer

YOSEMITE FARM CREDIT 2020 ANNUAL REPORT2

Board of Directors

MARK JENSENBoard Chair

Elected to the Board 2014

ANDREW BLOOMBoard Member


DAVE BROWNBoard Member


BRUCE BURROUGHSBoard Member


BRIAN GENZOLIBoard Member


RICK SCHEUBERAudit Committee


ALICIA MADSENAudit Committee Vice-ChairAppointed to the Board 2015

THOMAS MARINGBoard Member


DINO MIGLIAZZOAudit Committee


NANCY SILLBoard Vice-Chair

Appointed to the Board 2007


2.5%

2.0%

1.5%

1.0%

0.5%

0.0%

$2,661$2,889

$3,186$3,384

2016 2017 2018 2019 2020

1.76%1.79%

1.99%

2.20%

1.98%

$3,615

AS

SE

TS

(i

n M

illi

on

s)

EA

RN

ING

S(i

n M

illi

on

s)

CA

PIT

AL

(in

Mil

lio

ns)

40%

30%

20%

10%

0%

$59.3

$43.4

$53.0

$65.1 $63.9

20202016 2017 2018 2019

37.0%36.5%34.7%

30.0%

32.8%

15%

10%

5%

0%

$590.5

$473.7$524.0

$556.6

20202016 2017 2018 2019

$433.3

14.18% 14.26% 14.10% 13.88% 13.70%

TOTAL ASSETS

RETURN ONAVERAGE ASSETS

NET INCOME

OPERATINGEFFICIENCY RATIO

TOTAL CAPITAL

CORE SURPLUSCAPITAL RATIO

CET1 CAPITALRATIO

Financial Highlights


Stronger TogetherP

AT

RO

NA

GE

LO

AN

VO

LU

ME

B

Y C

OM

MO

DIT

YLO

AN

VO

LU

ME

BY

TY

PE REAL ESTATE MORTGAGE 73.3%

20202016 2017 2018 2019

$25.4

75BPS

$11.5

50BPS

$12.7

50BPS

$21.9

75BPS

$24.2

75BPS

Patronage Distribution (in millions) and Basis Points (BPS)

FRUIT & TREE NUTS 7.7%

FIELD CROPS 5.8%

DAIRY 31.8%

ALMONDS 28.7%

OTHER 26.0%

SHARING SUCCESSWITH OUR OWNERS

As a member-owned cooperative,

we refund a portion of annual

earnings to our stockholders,

effectively reducing the costs of

doing business with us. We’ve

returned over $162 million to our

members since 2006. For 2020,

we once again paid out 0.75% of

average loan balances to our

members, representing a record

cash patronage dividend.

PRODUCTION & INTERMEDIATE-TERM 17.0%

AGRIBUSINESS 9.4%

OTHER 0.3%

2020

2020


Giving Back$353,000 in 2020

GROWING THE FUTURE OF AGRICULTURE: SCHOLARSHIPS, EDUCATION, FFA, 4-H, YOUNG, BEGINNING & SMALL FARMERS’ PROGRAM

41% OF THE TOTAL AMOUNT GIVEN

LOCAL FAIRS / EVENTS:PARTICIPATION / SPONSORSHIPS


COMMUNITY SUPPORT:DONATIONS, DISASTER RELIEF, VOLUNTEERISM


AG INDUSTRY:SUPPORTING & RAISING AWARENESS



OurAssociation Values

We utilize Association teamwork.

We treat everyone with dignity and respect.

We are open and honest with each other.

We keep our promises and commitments.

We encourage employee empowerment through participatory involvement.

We evaluate employee growth opportunities equitably.

We provide the highest possible quality services.

We deliver service above self.

We support a well-educated professional staff.

We support the use of discretionary effort.

We respect the dignity of work.


ALBERTO DAIRYHickman, CA

BAYS RANCHPatterson, CA

BURROUGHS FAMILY FARMSDenair, CA

GENZOLI FAMILY FARMTurlock, CA

MARCHINI FARMSLe Grand, CA

MIGLIAZZO & SONS DAIRYAtwater, CA

MINTURN NUT CO. INC.Le Grand, CA

SCHEUBER FARMSPatterson, CA

MULLER BERRY FARMSDenair, CA


Internal Control — Integrated Framework (2013)


Farm Credit System Structure and Mission


Our Structure and Focus


Portfolio Diversification


Credit Commitments


High Risk Assets


Credit Quality


Allowance for Credit Losses


Young, Beginning and Small Farmers and Ranchers Program


Earnings Summary

Net Interest Income


Provision for Credit Losses/(Credit Loss Reversals)


Non-Interest Income

Non-interest Expense


Funding Sources

Interest Rate Risk


Funds Management


Retained Earnings

Patronage Program

Stock

Accumulated Other Comprehensive Income and Losses


Capital Plan and Regulatory Requirements

Building Projects


Board of Directors

Director Independence

Audit Committee


Compensation Committee

Other Governance


Allowance for Credit Losses


.

PRSRT STDU.S. POSTAGE

PAIDABS DIRECT

Yosemite Farm Credit l P.O. Box 3278 l Turlock, CA 95381

HELPING OUR MEMBERS PROSPER

annual report 2020 - yosemite farm credit, aca

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