AgStar Financial Services Announces Mid-Year Earnings
Net earnings reported at $21.8 million
MANKATO, Minn. (August 3, 2009) – AgStar Financial Services, a value-added financial services company owned by its client-stockholders, today reported earnings for mid-year ending June 30, 2009. The company reported net earnings of $21.8 million for the first half of 2009, below last year’s record first half earnings of $39.2 million. The earnings decline was primarily caused by higher than expected provision expenses, due to the continued economic challenges facing clients in the swine, dairy and renewable energy sectors.
“This year has been particularly challenging for several sectors in agriculture and, like our clients, we have been impacted,” stated Paul DeBriyn, AgStar’s President and CEO. “However, our core business remains strong and net operating income is over budget. Our capital position is healthy, with key ratios well above regulatory requirements. Unlike many other lenders, AgStar remains profitable with a strong, committed team in place to serve our client-stockholders.”
During the first six months, AgStar reported loan and lease volume increased 5.1%. Double-digit revenue gains from fee income, hail insurance and accounting services added to the company’s solid performance. In August, AgStar will distribute allocation notices to stockholders for $34 million in patronage dividends based on 2008 earnings. Since 1998, AgStar has allocated $232 million in patronage dividends to qualified stockholders.
“While conditions in the renewable energy sector have shown signs of stabilization, conditions in the swine and dairy industries remain very challenging,” stated DeBriyn. “Everyday we work diligently with our clients to find solutions for this dynamic and volatile marketplace, continuing to provide the high level service and expertise they deserve.”
About AgStar:
AgStar Financial Services, ACA, headquartered in Mankato, Minn., employs more than 610 full-time team members. The company is part of the national Farm Credit System and has a public mission to serve 69 counties in Minnesota and northwest Wisconsin. AgStar’s industry specialization, client segments and market delivery systems result in diversification nationwide. The company has expertise in the corn, soybean, swine, dairy and bio-energy industries. AgStar has developed successful programs in loans, leases, crop insurance, tax services, accounting, consulting and rural home mortgages. As a value-added financial services cooperative, AgStar allocates patronage dividends to its 13,000 stockholders. The company is also committed to giving back to rural residents, organizations and communities through AgStar’s Fund for Rural America. Visit www.AgStar.com for more information.
Contact: Heather Leiferman
Heather.Leiferman@AgStar.com
507-529-2087
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