Federal Agricultural Mortgage Corp (AGM) 2024 Q2 法說會逐字稿

Good afternoon ladies and gentlemen, and welcome to the Farmer Mac second-quarter 2024 earnings conference call. (Operator Instructions) This call is being recorded on Monday, August 5, 2024.

女士們先生們下午好，歡迎參加 Farmer Mac 2024 年第二季財報電話會議。（操作員說明）此通話錄音時間為 2024 年 8 月 5 日星期一。

I would now like to turn the conference over to Jalpa Nazareth. Please go ahead.

我現在想把會議交給賈爾帕·拿撒勒。請繼續。

Good afternoon, and thank you for joining us for our Second Quarter 2024 Earnings Conference Call. I'm Jalpa Nazareth, Senior Director of Investor Relations and Finance Strategy here at Farmer Mac. As we begin, please note that the information provided during this call may contain forward-looking statements about the company's business, strategies, and prospects which are based on management's current expectations and assumptions.

下午好，感謝您參加我們的 2024 年第二季財報電話會議。我是 Jalpa Nazareth，Farmer Mac 投資者關係和財務策略高級總監。首先，請注意，本次電話會議中提供的資訊可能包含基於管理層當前預期和假設的有關公司業務、策略和前景的前瞻性陳述。

These statements are not a guarantee of future performance and are subject to the risk and uncertainties that could cause our actual results to differ materially from those projected. Please refer to Farmer Mac's 2023 Annual Report and subsequent SEC filings for a full discussion of the company's risk factors.

這些陳述並不是對未來績效的保證，並受到風險和不確定性的影響，這些風險和不確定性可能導致我們的實際結果與預測有重大差異。請參閱 Farmer Mac 的 2023 年年度報告和隨後向 SEC 提交的文件，以了解對該公司風險因素的全面討論。

On today's call, we will also be discussing certain non-GAAP financial measures. Disclosures and reconciliations of these non-GAAP measures can be found in the most recent Form 10-Q and earnings release posted on Farmer Mac website, farmermac.com, under the financial information portion of the Investors section.

在今天的電話會議上，我們還將討論某些非公認會計準則財務指標。這些非 GAAP 指標的揭露和調節可在 Farmer Mac 網站 farmermac.com 投資者部分的財務資訊部分下發布的最新 10-Q 表格和收益發布中找到。

Joining us for management this afternoon is our President and Chief Executive Officer, Brad Nordholm, who will discuss second quarter business and financial highlights and strategic objectives, and Chief Financial Officer, Aparna Ramesh, who will provide greater detail on our financial performance. Select members of our management team will also be joining us for the question-and-answer period.

今天下午加入我們管理層的是我們的總裁兼首席執行官 Brad Nordholm，他將討論第二季度的業務和財務亮點以及戰略目標，首席財務官 Aparna Ramesh 將提供有關我們財務業績的更多詳細信息。我們管理團隊的精選成員也將參加我們的問答環節。

At this time, I'll turn the call over to President and CEO Brad Nordholm. Brad?

此時，我會將電話轉給總裁兼執行長 Brad Nordholm。布拉德？

Thank you, Jalpa. Good afternoon, everyone, and thank you very much for joining us. Our focus on stability, profitability, and growth has once again produced consistent results. Our underlying business model, strong capital position, and uninterrupted access to the debt capital markets throughout the full range of market cycles, uniquely position us to partner with our customers to help them grow and manage any capital and liquidity risks they might face.

謝謝你，賈爾帕。大家下午好，非常感謝您加入我們。我們對穩定性、獲利能力和成長的關注再次產生了一致的結果。我們的基礎業務模式、強大的資本狀況以及在整個市場週期中不間斷地進入債務資本市場，使我們能夠與客戶合作，幫助他們發展和管理他們可能面臨的任何資本和流動性風險。

The foundation of our strategy is our consistent financial and operational execution, coupled with proactive management of our balance sheet and funding sources. This has positioned as well in all environments and is expected to continue to create more opportunities for enhanced shareholder value through our mission fulfillment.

我們策略的基礎是我們一致的財務和營運執行，以及對資產負債表和資金來源的積極管理。這在所有環境中都是如此，預計將透過我們履行使命繼續創造更多機會，提高股東價值。

During the quarter, we closed $1.5 billion of new business. Approximately 70% of the new volume consisted of higher spread longer-term loan purchase volume across all of our segments. Our total revenues in second quarter 2024 improved $2.4 million over the same quarter last year to $89 million.

本季度，我們完成了 15 億美元的新業務。大約 70% 的新增貸款量由我們所有細分市場中較高利差的長期貸款購買量組成。我們 2024 年第二季的總營收比去年同期增加了 240 萬美元，達到 8,900 萬美元。

As the compositional shift of new business volume towards higher spread loans resulted in higher net effective spread and our operating efficiency level was 27%, better than our long-term target of 30%, a reflection of our disciplined approach to expense management.

由於新業務量的結構向更高利差貸款的轉變，導致淨有效利差更高，我們的營運效率水準為27%，優於我們30% 的長期目標，這反映了我們嚴格的費用管理方法。

Core earnings were lower relative to second quarter 2023, primarily due to the partial charge off of a single permanent planting loan. Excluding the impact of credit expenses, core earnings were $45 million, which is an increase both sequentially and year-over-year.

核心收益相對 2023 年第二季有所下降，主要是由於單筆永久性種植貸款部分沖銷。排除信貸費用的影響，核心收益為 4500 萬美元，環比和同比均有所增長。

As we've mentioned on prior calls, the nature of our credit events and the charge-offs have tended to be idiosyncratic. We believe that our credit profile remains strong in the aggregate and that we would be able to withstand significant shocks given our strong levels of capital.

正如我們在先前的電話會議中所提到的，我們的信用事件和沖銷的本質往往是特殊的。我們相信，我們的信用狀況總體上仍然強勁，鑑於我們強大的資本水平，我們將能夠承受重大衝擊。

Turning to our portfolio, loan purchase volume growth was strong in the renewable energy and farm and ranch segments, reflecting borrowers' adjustment to the current interest rate environment. We purchased more renewable energy loans in the first half of 2024 than in all of last year, reflecting the continued strong demand for renewable power generation and storage, as well as the continuing expansion of our team.

就我們的投資組合而言，再生能源和農牧業領域的貸款購買量成長強勁，反映出借款人對當前利率環境的調整。2024年上半年，我們購買的再生能源貸款比去年全年還要多，反映出對再生能源發電和儲存的持續強勁需求，以及我們團隊的持續擴張。

Outstanding volume in the renewable energy segment has more than doubled since the second quarter last year, and our pipeline remains very strong heading into the second half of the year. As previously mentioned, renewable energy loans are aligned with our mission while being accretive to revenues and net effective spreads relative to our other eligible loans.

自去年第二季以來，再生能源領域的未完成交易量增加了一倍多，而且我們的管道在進入今年下半年時仍然非常強勁。如前所述，再生能源貸款符合我們的使命，同時相對於我們的其他合格貸款可增加收入和淨有效利差。

Within our farm and ranch segment, we closed $700 million in new farm and ranch loan purchase volume in the first half of this year. That compares with a total of $780 million in the full year of 2023. We believe we will see this positive momentum continue to the remainder of the year as tightening bank liquidity and an adjustment to a higher rate environment with a near-term expectation of Federal Reserve Bank policy easing has taken hold.

在我們的農場和牧場部門，今年上半年我們完成了 7 億美元的新農場和牧場貸款購買量。相較之下，2023 年全年總額為 7.8 億美元。我們相信，隨著銀行流動性收緊和利率環境調整以及近期聯準會政策寬鬆的預期已經確立，這種積極勢頭將持續到今年剩餘時間。

The forecasted decline in farm income relative to prior years is expected to drive more long volume, including potential pool purchases like the one we acquired earlier this year. We are incredibly pleased to see strong momentum in the farm and ranch segment. It is a segment that is core to our mission and growth in this segment continues to propel our securitization program where we have seen strong investor demand.

預計農場收入相對前幾年的下降預計將推動更多的長期交易量，包括潛在的集體購買，就像我們今年早些時候購買的那樣。我們非常高興看到農場和牧場領域的強勁勢頭。這是我們使命的核心部分，該部分的成長繼續推動我們的證券化計劃，我們看到了投資者的強勁需求。

As we discussed on our last earnings call, we closed our fourth FARM series securitization transaction in the second quarter, and we're currently working on our fifth transaction for some time potentially later this year. We are very pleased with the tremendous support we've seen from our customers and investors for this program and remain committed to being a regular issuer in the market with a set of securitization products that align with both our and investor interests.

正如我們在上次財報電話會議上討論的那樣，我們在第二季度完成了第四筆 FARM 系列證券化交易，目前我們正在處理第五筆交易，可能會在今年稍後進行。我們對客戶和投資者對該計劃的大力支持感到非常高興，並繼續致力於成為市場上的常規發行人，提供一系列符合我們和投資者利益的證券化產品。

As we look ahead, we are likely entering a period of macroeconomic level volatility. Farm income is projected to trend downward, but that coupled with possible Fed policy easing, might create loan purchase opportunities for us in our farm and ranch segment.

展望未來，我們很可能進入宏觀經濟水準波動的時期。農場收入預計將呈下降趨勢，但加上聯準會可能放鬆政策，可能會為我們的農場和牧場部門創造貸款購買機會。

We continue to serve as an attractive financing alternative for our wholesale counterparties in addressing their liquidity needs. But we have seen and expect to continue to see business volume and AgVantage Securities to be volatile due to slower market loan growth and a tightening of credit spreads resulting in reduced liquidity needs from our counterparties. While volatility is expected in the short term, over time we do anticipate further growth in our AgVantage business volume given the relative value of this product for our counterparties.

我們繼續為我們的批發交易對手提供有吸引力的融資選擇，以滿足他們的流動性需求。但我們已經看到並預計將繼續看到業務量和 AgVantage 證券波動，原因是市場貸款成長放緩和信貸利差收緊導致我們交易對手的流動性需求減少。雖然短期內預計會出現波動，但鑑於該產品對我們交易對手的相對價值，隨著時間的推移，我們預計 AgVantage 業務量將進一步增長。

I'm very pleased with how we are executing this company and what continues to be an uncertain economic credit and interest rate backdrop. We are maintaining our disciplined asset liability management, uninterrupted access to capital markets and a strong capital base while producing a double-digit return on equity of 16%.

我對我們執行這家公司的方式以及仍然不確定的經濟信貸和利率背景感到非常滿意。我們保持嚴格的資產負債管理、不間斷的資本市場准入和強大的資本基礎，同時實現 16% 的兩位數股本回報率。

Excluding the credit expense, our return on equity was 18%. The overall earnings story continues to be consistent. The diversification into revenue streams, particularly renewable energy, and our other newer business portfolios.

不計信貸費用，我們的股本報酬率為 18%。整體獲利情況持續保持一致。收入來源多元化，特別是再生能源，以及我們其他較新的業務組合。

And the resilience of our business model supports our long-term strategic growth objectives, while also providing a buffer against market volatility and a changing credit environment. As we look forward, we're encouraged by the momentum we've seen since the start of the year.

我們業務模式的彈性支持我們的長期策略成長目標，同時也為應對市場波動和不斷變化的信貸環境提供緩衝。展望未來，我們對今年年初以來所看到的勢頭感到鼓舞。

We believe that we are well-positioned to make continuous progress on our long-term strategic growth initiatives to further our mission efficiently and innovatively, as we navigate this backdrop of broader market uncertainty.

我們相信，在我們應對更廣泛的市場不確定性的背景下，我們有能力在長期策略成長計畫上不斷取得進展，以高效和創新的方式推進我們的使命。

And now with that, I'd like to turn the call to Aparna Ramesh, our CFO to discuss our financial results in more detail. Aparna.

現在，我想致電我們的財務長 Aparna Ramesh，更詳細地討論我們的財務表現。阿帕娜。

Thank you, Brad, and good afternoon, everyone. Our second quarter 2024 results highlight our consistent financial and operational execution that, coupled with proactive management of our balance sheet and funding sources, have resulted in outstanding business volume of $28.8 billion as of June 30th. This represents a net decrease of $88.9 million from March 31, 2024, largely due to scheduled maturities and repayments in the agricultural finance line of business.

謝謝布拉德，大家下午好。我們2024 年第二季的業績凸顯了我們一貫的財務和營運執行力，再加上對資產負債表和資金來源的積極管理，截至6 月30 日，我們的未完成業務量達到了288 億美元。這意味著自 2024 年 3 月 31 日起淨減少 8,890 萬美元，主要是由於農業金融業務線的預定到期和還款。

During the quarter, $785 million in farm and ranch AgVantage Securities matured without refinancing, reflecting counterparties evaluating their liquidity needs amid the ongoing market dynamics. Changes in the quarterly AgVantage Securities volume are primarily driven by the larger transaction sizes for the product.

本季度，7.85 億美元的農場和牧場 AgVantage 證券在沒有再融資的情況下到期，反映出交易對手在持續的市場動態中評估其流動性需求。AgVantage 證券季度交易量的變動主要是由於該產品交易規模的擴大所致。

Scheduled maturity amounts for a particular quarter, the liquidity needs of Farmer Mac Advantage counterparties, changes in the pricing and availability of wholesale funding, and the relative value of our wholesale financing products versus other funding alternatives.

特定季度的預定到期金額、Farmer Mac Advantage 交易對手的流動性需求、批發融資的定價和可用性的變化，以及我們的批發融資產品與其他融資替代方案的相對價值。

Based on all these factors, we expect advantage business volume in both lines of business to continue to be volatile as we navigate the evolving needs of our stakeholders. While volume declined on a net basis, there was strong activity in our farm and ranch and our renewable energy segments.

基於所有這些因素，我們預計，隨著我們滿足利害關係人不斷變化的需求，這兩個業務線的優勢業務量將繼續波動。雖然銷量淨值下降，但我們的農場和牧場以及再生能源領域的活動仍然強勁。

The activity in those two business segments included strong loan purchase volume, which is generally more accretive and higher spread relative to AgVantage Securities. This high spread business volume drove the quarter-over-quarter increase in NES.

這兩個業務部門的活動包括強勁的貸款購買量，相對於 AgVantage 證券，貸款購買量通常更具增值性和更高的利差。這種高價差業務量推動了 NES 的環比成長。

Core earnings were $39.8 million or $3.63 per share in second quarter 2024, reflecting a $3.6 million decrease sequentially and a $2.4 million decrease year-over-year. The sequential and year-over-year change in core earnings was primarily due to a $6.2 million provision to the total allowance for losses.

2024 年第二季核心收益為 3,980 萬美元，即每股 3.63 美元，季減 360 萬美元，年減 240 萬美元。核心收益的環比和同比變化主要是由於撥備了 620 萬美元的總損失準備金。

That provision was primarily attributable to a single permanent planting loan that is in bankruptcy and this resulted in a $3.9 million charge off to reflect the amount we have deemed uncollectible. The other factor is the increase in loan volume related to renewable energy loan purchases.

這項撥備主要歸因於一項處於破產狀態的永久種植貸款，這導致我們沖銷了 390 萬美元，以反映我們認為無法收回的金額。另一個因素是與再生能源貸款購買相關的貸款量的增加。

Core earnings, net of credit however, increased by 7% sequentially and 4% year-over-year, offsetting the impact of the higher provision and higher funding costs this quarter with an increase in net effective spread and as noted it was driven by the compositional shift in new business volume to higher spread products. We did see an increase in funding costs from the opportunistic issuance of debt at advantageous rates, which we did in advance of funding needs.

然而，扣除信貸後的核心收益環比增長 7%，同比增長 4%，通過淨有效利差的增加抵消了本季度準備金增加和融資成本增加的影響，正如所指出的，這是由新業務量的構成轉向更高價差的產品。我們確實看到，由於我們在融資需求之前就以優惠利率投機發行債務，導致融資成本增加。

As we've mentioned on prior calls, we achieved record levels of net effective spread over the course of 2023, as we benefited from the rapid rise in short-term rates and by reinvesting excess capital, we generated additional return from an upward repricing of our short-term investment portfolio.

正如我們在先前的電話會議中提到的，我們在2023 年實現了創紀錄的淨有效利差水平，因為我們受益於短期利率的快速上升，並且透過對多餘資本進行再投資，我們從向上重新定價中獲得了額外回報我們的短期投資組合。

The capital and debt that we raised proactively and opportunistically when rates were at historical lows in 2020 and 2021, positioned us well throughout the rising rate environment and ongoing market uncertainty. But at the time that we raised that capital, we did see a reduction in earnings.

當 2020 年和 2021 年利率處於歷史低點時，我們主動和機會主義地籌集了資本和債務，使我們在利率上升的環境和持續的市場不確定性中處於有利地位。但在我們籌集資金時，我們確實看到了收益的減少。

In a similar fashion, we have now made a decision to opportunistically lengthen the tenor of our liquidity investment portfolio, as part of our overall balance sheet management strategy and to mitigate volatility from decreases in the rate environment.

以類似的方式，我們現在決定機會性地延長流動性投資組合的期限，作為我們整體資產負債表管理策略的一部分，並減輕利率環境下降帶來的波動。

While we might sacrifice some short-term earnings from keeping the investment portfolio short, as we move into the anticipated FED easing cycle, we expect to be well-positioned in the medium term. We also executed on some attractive opportunities in the first quarter to increase our debt issuances, and we expect to reap those benefits, as well as business volumes start to accelerate.

雖然我們可能會因保持投資組合短期而犧牲一些短期收益，但隨著我們進入預期的聯準會寬鬆週期，我們預計在中期處於有利地位。我們也在第一季抓住了一些有吸引力的機會來增加債務發行，我們預計將獲得這些好處，並且業務量開始加速。

Offsetting some of these increases in funding and liquidity expenses was a strategic sale of investment securities that yielded a gain of $1.1 million. The sale of these securities was done to rebalance the liquidity investment portfolio to align with the current level of business volume activity, while allowing us to test the market and our portfolio for contingent liquidity. Even with the sale, we remain highly liquid. As of June 30th, we held approximately $900 million in cash and other short-term instruments in our investment portfolio.

投資證券的策略性出售產生了 110 萬美元的收益，抵消了部分融資和流動性費用的增加。出售這些證券是為了重新平衡流動性投資組合，以適應當前的業務量活動水平，同時使我們能夠測試市場和投資組合的或有流動性。即使出售，我們仍保持高度流動性。截至 6 月 30 日，我們的投資組合中持有約 9 億美元的現金和其他短期工具。

Another factor driving our earnings results this quarter was the sale of a portion of a corporate ag finance, agricultural storage and processing loan. The decision to sell a portion of the corporate ag finance loan that resulted in a loss of $1.1 million during this quarter was really to reduce the overall exposure to the borrower due to an updated credit profile. After the sale of this loan, the borrower restructured its credit facilities and addressed the short-term headwinds.

推動我們本季獲利的另一個因素是出售部分企業農業融資、農業倉儲和加工貸款。出售部分企業農業融資貸款的決定導致本季損失 110 萬美元，實際上是為了減少借款人因信用狀況更新而面臨的整體風險。在出售這筆貸款後，借款人重組了信貸安排並解決了短期阻力。

Farmer Mac's exposure to that loan was $7.4 million as of June 30, 2024. Market valuation of this particular exposure has since improved given the restructuring. Our liquidity and capital positions remain well in excess of all regulatory requirements, and our projections show minimal change in our profitability and limited exposure to movements and interest rates where the market rates go up or down.

截至 2024 年 6 月 30 日，Farmer Mac 的貸款金額為 740 萬美元。由於重組，此特定風險敞口的市場估值有所改善。我們的流動性和資本部位仍然遠遠超過所有監管要求，我們的預測顯示我們的獲利能力變化很小，而且市場利率上漲或下跌時受到的變動和利率風險有限。

As of June 30, 2024, Farmer Mac had 283 days of liquidity, which is another important data point that validates our expected resiliency against short and medium-term market disruptions.

截至 2024 年 6 月 30 日，Farmer Mac 擁有 283 天的流動性，這是另一個重要的數據點，驗證了我們對中短期市場幹擾的預期彈性。

We project flat to higher earnings if rates decline in the future due to our proactive capital allocation strategy where we are laddering and layering duration to minimize volatility. These are practices, as we've noted previously, that are consistent with our disciplined asset liability management approach, which is designed to help minimize earning volatility over the medium to long term.

由於我們積極主動的資本配置策略，我們透過階梯式和分層久期來最大程度地減少波動性，因此如果未來利率下降，我們預計收益將持平或更高。正如我們先前指出的，這些做法與我們嚴格的資產負債管理方法一致，旨在幫助最大限度地減少中長期收益波動。

Despite macro headwinds and widening credit spreads that have affected many primary issuers of debt securities recently, we continue to see strong access to debt capital markets and a flight-to-quality investments. These factors, coupled with opportunistic debt issuances, allow us to be very well positioned to creatively fund new asset opportunities as they arise.

儘管宏觀阻力和信貸利差擴大最近影響了許多債務證券的主要發行人，但我們仍然看到進入債務資本市場的便利性和對優質投資的青睞。這些因素，加上機會性債務發行，使我們能夠在新資產機會出現時創造性地為其提供資金。

Operating expenses declined by 10% sequentially, primarily due to a decrease in consulting costs related to technology strategic initiatives. Operating expenses increased 2% year-over-year, primarily due to increased headcount and increased stock compensation expense. Operating efficiency was 27% for second quarter 2024, which is better than our long-term strategic plan target.

營運費用較上季下降 10%，主要是由於與技術策略計畫相關的諮詢成本下降。營運費用年增 2%，主要是因為員工人數增加和股票薪酬費用增加。2024 年第二季營運效率為 27%，優於我們的長期策略計畫目標。

We will closely monitor our efficiency ratio and manage it such that we expect to remain at or below a long-run average of 30%. As we make investments in our loan infrastructure and funding platforms and continue to innovate our loan processes to accelerate growth, we plan to be disciplined in keeping our efficiency ratios in line with our growth expectations.

我們將密切監控我們的效率比率並對其進行管理，以確保我們的效率保持在或低於 30% 的長期平均值。當我們對貸款基礎設施和融資平台進行投資並繼續創新貸款流程以加速成長時，我們計劃嚴格遵守效率比率以符合我們的成長預期。

As of June 30, 2024, the total allowance for losses was $18.6 million, reflecting a $2.2 million increase from March 31, 2024. Increase was primarily attributable to a single permanent planting loan that is in bankruptcy, which resulted in a $3.9 million charge-off to reflect the amount we have deemed uncollectible.

截至2024年6月30日，損失準備金總額為1,860萬美元，較2024年3月31日增加220萬美元。增加的主要原因是一筆處於破產狀態的永久種植貸款，導致沖銷 390 萬美元，以反映我們認為無法收回的金額。

The remaining $2.2 million provision, as noted previously, was a result of new business volume and higher yielding segments. Based on our point-in-time analysis, it's important to note that we do not believe that the charge-off on this one loan is indicative of a broader set of systemic risks within our portfolio.

如前所述，剩餘的 220 萬美元撥備是新業務量和更高收益部門的結果。根據我們的時間點分析，值得注意的是，我們並不認為這筆貸款的沖銷顯示我們的投資組合中存在更廣泛的系統性風險。

But we continue to closely monitor climate and weather-related effects on commodity prices and corresponding land valuation, especially across certain regions that have experienced drought.

但我們繼續密切監測氣候和天氣相關對大宗商品價格和相應土地估值的影響，特別是在某些經歷乾旱的地區。

Our overall credit profile continue to be stable across our agricultural and rural infrastructure portfolios through second quarter 2024. And this is reflective of our rigorous credit policies and diligent underwriting practices. 90-day delinquencies as of June 30, 2024 reflect 22 basis points across our entire portfolio compared to 17 basis points in the same period last year.

到 2024 年第二季度，我們農業和農村基礎設施投資組合的整體信用狀況持續保持穩定。這反映了我們嚴格的信貸政策和勤勉的承保實務。截至 2024 年 6 月 30 日，我們整個投資組合的 90 天拖欠率為 22 個基點，而去年同期為 17 個基點。

Turning now to capital, Farmer Mac $1.5 billion of core capital as of June 30, 2024, exceeded our statutory requirement by $626 million or 71%. Core capital increased sequentially, primarily due to an increase in retained earnings. Our tier 1 capital ratio, as of June 30, 2024, slightly decreased to 15.3% from 15.4% at year end. On July 18, 2025, we redeemed 75 million of series C preferred stock, which on its own will be accretive to core earnings beginning in the third quarter, all other factors being equal.

現在轉向資本，截至 2024 年 6 月 30 日，Farmer Mac 的核心資本為 15 億美元，超出我們的法定要求 6.26 億美元，即 71%。核心資本環比增加，主要是因為留存收益增加。截至2024年6月30日，我們的一級資本比率從去年底的15.4%小幅下降至15.3%。2025 年 7 月 18 日，我們贖回了 7,500 萬股 C 系列優先股，在其他因素相同的情況下，這些優先股本身將增加第三季開始的核心獲利。

We considered several factors prior to making this decision, including a robust capital position, a securitization program, dividend strategy, and the recapitalization that has come from consistent earnings growth. Our levels of capitalization have remained strong and as noted, exceed all regulatory requirements. Maintaining credit standards that reflect our risk profile coupled with strong levels of capital is a fundamental part of our long-term strategy.

在做出這項決定之前，我們考慮了幾個因素，包括穩健的資本狀況、證券化計劃、股息策略以及持續獲利成長所帶來的資本重組。我們的資本水準仍然強勁，並且如上所述，超過了所有監管要求。維持反映我們風險狀況的信用標準以及強大的資本水準是我們長期策略的基本組成部分。

We expect a strong capital position to allow us to grow in more capital-intensive segments, enable us to remain resilient in volatile credit environments, and allow us to offer a source of low-cost liquidity for our customers and borrowers, even in difficult times.

我們預計強大的資本狀況將使我們能夠在資本密集型領域實現成長，使我們能夠在動盪的信貸環境中保持彈性，並使我們能夠為客戶和借款人提供低成本流動性來源，即使在困難時期。

In conclusion, our entire team delivered strong quarterly results, maintaining the key metrics that we highlight on each call, while staying within our credit framework, which emphasizes loan to value and cash flow metrics.

總而言之，我們整個團隊交付了強勁的季度業績，維持了我們在每次通話中強調的關鍵指標，同時保持在我們的信貸框架內，該框架強調貸款價值和現金流量指標。

Notably, we delivered a 16% return on equity this quarter, 18% excluding the credit expense. And we also stayed below our efficiency ratio target of 30%. We believe that our balance sheet is well positioned for market uncertainty, and we are more optimistic than ever to deliver on our long-term strategic plan objectives.

值得注意的是，本季我們的股本報酬率為 16%，不包括信貸費用為 18%。我們的效率比率也低於 30% 的目標。我們相信，我們的資產負債表能夠很好地應對市場的不確定性，並且我們比以往任何時候都更加樂觀地實現我們的長期策略計畫目標。

With that, Brad, let me turn it back to you.

那麼，布拉德，讓我把它轉回給你。

Thank you, Aparna. As we've attempted to highlight one more quarter for you, our business model is resilient and diversified. Our balance sheet is very healthy, and our team is as committed as ever. We operate with high capital levels, and we are well positioned to deliver earnings growth and strong profitability for the remainder of 2024.

謝謝你，阿帕娜。正如我們試圖向您強調的另一個季度，我們的業務模式具有彈性和多元化。我們的資產負債表非常健康，我們的團隊一如既往地忠誠。我們的資本水準很高，我們有能力在 2024 年剩餘時間內實現獲利成長和強勁的獲利能力。

We've emphasized that our ability to issue long data fixed rate debt in all rate environments, bolstered by a growing securitization program is a core competitive advantage. That advantage, combined with our diversified revenue strategies and our disciplined approach to asset liability management, has resulted in consistent spreads across all business cycles, including the second quarter of 2024.

我們強調，在不斷發展的證券化計畫的支持下，我們在所有利率環境下發行長期數據固定利率債務的能力是一項核心競爭優勢。這項優勢，再加上我們多元化的收入策略和嚴格的資產負債管理方法，使得所有業務週期（包括 2024 年第二季）的利差保持一致。

And now, operator, I'd like to see if we have any questions from anyone on the line today.

現在，接線員，我想看看今天在線的任何人是否有任何問題。

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. (Operator Instructions)

謝謝。女士們、先生們，我們現在開始問答環節。（操作員說明）

Bose George, KWB.

博斯·喬治，KWB。

Everyone. good afternoon. I wanted to ask about, actually, Aparna, you stated that you expect flat to higher earnings, as rates go down. I was curious, are you expecting flat to higher spreads as well, or is this the combination of spreads and volume growth?

每個人。午安.事實上，我想問的是，阿帕納，您表示，隨著利率下降，您預計收入持平甚至更高。我很好奇，您是否也期望價差持平到更高，或者這是價差和成交量成長的結合？

Yeah, that's correct. Both, as you know, we stress test our balance sheet on a monthly basis in terms of exposure to nominal interest rates. And so when we sort of head into a, what I would call a Fed easing cycle. You know, what we see is a, I would say a marginal improvement in our net effective spread in terms of just margin.

是的，這是正確的。如您所知，我們每月都會根據名目利率風險對資產負債表進行壓力測試。因此，當我們進入我所說的聯準會寬鬆週期時。你知道，我們看到的是，我想說的是，就利潤率而言，我們的淨有效利差略有改善。

If you go back, I'll just give you a couple of data points. If you go back a couple of years, you probably would have seen levels of net effective spread that are very similar to where we're at right now. What we've talked about relative to some of the run-ups that we saw in our spread last year had to do with our exposure to our investment portfolio staying pretty short.

如果你回去，我只會給你一些數據點。如果你回到幾年前，你可能會看到淨有效價差水準與我們現在的水準非常相似。我們所討論的相對於去年我們在利差中看到的一些上漲與我們的投資組合敞口保持相當短有關。

And by lengthening that, we certainly started to slowly give up some of those gains that we picked up last year. So most of that, about 4 basis points or so, is driven by funding. And the funding dynamic is such that it's likely to reverse both in terms of spread but also earnings, as we start to move into a Fed easing cycle.

透過延長這段時間，我們當然開始慢慢放棄去年所取得的一些成果。因此，其中大部分（大約 4 個基點左右）是由資金推動的。隨著我們開始進入聯準會的寬鬆週期，融資動態可能會在利差和獲利方面出現逆轉。

You know, just to expand a little bit on that, you know, just in the past month we've seen the 10-year treasury come down by close to 50 basis points. And so as we've lengthened our investment portfolio, we will start to see the benefit of that because that's really locked in over the medium to long-term.

你知道，只是擴大一點，你知道，就在過去一個月，我們看到 10 年期公債下跌了近 50 個基點。因此，當我們延長投資組合時，我們將開始看到其中的好處，因為這確實是在中長期鎖定的。

On a spread basis, it's really hard to project exactly how much that's going to be because that's going to depend just on the compositional shift overall in terms of our asset portfolio, but everything else remaining equal. If you were to just extrapolate from where we are today and account for that dynamic, you should see a pickup both in terms of earnings as well as in terms of just NES spread.

在利差的基礎上，很難準確預測特定金額，因為這將僅取決於我們資產組合的整體組成變化，但其他一切都保持不變。如果你只是從我們今天的情況進行推斷並考慮到這種動態，你應該會看到收入和 NES 利差均有所回升。

I'll just mention one more thing, and that is, we did see a little bit of what I would call a deceleration in our spread because we funded in advance of earnings, but I'm sorry, in advance of volume. So we should really start to see a little bit of a pick up there as well, but it's hard to predict exactly when that might occur.

我只想再提一件事，那就是，我們確實看到了一點我所說的利差減速，因為我們在盈利之前就進行了融資，但我很抱歉，是在成交量之前進行的。因此，我們確實應該開始看到那裡的一些回升，但很難準確預測何時會發生。

Okay, great. That's helpful. Thanks. And I wanted to ask also just about the mortgage loan, not the charge of fund, but the one that was sold during the quarter. What's the status of that? How did the borrower, what work was done with the borrower for them to be current and just comfort in that loan going forward?

好的，太好了。這很有幫助。謝謝。我還想詢問抵押貸款的情況，而不是基金費用，而是本季出售的貸款。那是什麼狀態？借款人是如何做到的，與借款人一起做了哪些工作，以使他們能夠滿足當前的需求並在未來的貸款中感到安心？

Yeah, Bose, this is Brad. And nice to have you on the call. I'll turn to Zach Carpenter to give you a little color on that decision process. Of course, hindsight is always a wonderful thing to have.

是的，Bose，這是布拉德。很高興您接聽電話。我將請扎克·卡彭特（Zach Carpenter）為您提供有關該決策過程的一些資訊。當然，事後諸葛亮總是一件美妙的事。

Yeah, thanks, Brad. Yeah, in this specific situation, the borrower is heading into 2024 with some industry headwinds. They had some adverse events in some of their manufacturing facilities. And given kind of that overall view of that specific situation, we decided to tactfully reduce our exposure to what I'd say is more palatable level, given that increase in risk. Post that sale, the borrowers able to restructure its facilities with 100% lender support and has completely rectified those adverse situations in its manufacturing plants.

是的，謝謝，布拉德。是的，在這種特定情況下，借款人將在 2024 年面臨一些行業阻力。他們的一些生產設施發生了一些不良事件。考慮到對特定情況的整體看法，考慮到風險的增加，我們決定巧妙地將我們的風險敞口降低到我所說的更可接受的水平。此次出售後，借款人能夠在貸款人 100% 的支持下重組其設施，並徹底糾正其製造工廠的不利情況。

In addition, we see some easing in the industry headwinds it was facing last year. So we feel comfortable with our exposure currently and we feel optimistic that this individual borrower is moving in the right direction from an industry perspective as well as an individual manufacturing facility perspective.

此外，我們看到去年面臨的產業阻力有所緩解。因此，我們對目前的風險感到滿意，並且我們對這個個人借款人從行業角度以及單一製造設施的角度來看正在朝著正確的方向前進感到樂觀。

Okay, great. Thank you.

好的，太好了。謝謝。

Bill Ryan, Seaport Research Partners.

比爾·瑞安，海港研究合作夥伴。

Good afternoon, Brad and Aparna. First question, just on the loan that you had the charge off on of $3.9 million, if you can maybe talk a little bit more color about the nature of the loan, what makes it idiosyncratic relative to the rest of your portfolio?

下午好，布萊德和阿帕娜。第一個問題，就您沖銷的 390 萬美元的貸款而言，您是否可以更詳細地談談貸款的性質，相對於您的投資組合的其他部分，是什麼讓它與眾不同？

Maybe was it an older loan? And then I also know you have a history of recognizing charge-offs, and then somewhere down the line, you end up posting recovery. So has this loan fully resolved, or is it still kind of going through a process?

也許這是一筆較舊的貸款？然後我也知道你有承認沖銷的歷史，然後在某個地方，你最終會發布恢復。那麼這筆貸款是否已經完全解決了，還是仍在經歷一個過程？

Yeah, again, great to have you on. And I'm going to turn to Marc Crady to give you a little color on some of the additional analysis we've done relative to sector exposure but what made this one abet unusual really two things.

是的，再次，很高興有你在。我將請馬克·克拉迪（Marc Crady）為您介紹我們針對行業風險所做的一些額外分析，但是是什麼讓這一分析不同尋常，實際上有兩件事。

One is that you know we've been closely monitoring the drought in California the last four years, extensive analysis about all of our borrowers the sources of water they have whether they have multiple sources of water et cetera, et cetera and I hope that you know you felt that we gave you know a lot of insight into that and our work to stay on top of it.

一是你知道我們在過去四年裡一直在密切監測加州的乾旱情況，對我們所有借款人的水源進行了廣泛的分析，他們是否擁有多種水源等等，等等，我希望你知道你覺得我們給了你很多關於這一點的見解以及我們的工作以保持領先地位。

It's a bit ironic, but this power actually suffered from too much water this last winter is that moisture cycle kind of reversed itself. And more specifically a lot of their plots were in areas in the delta country in California where the combination of rising groundwater from the recharge as well some issues with salinity resulted in the roots of the grows frankly rotting and that's something that you couldn't even see months in advance it happened very, very quickly

這有點諷刺，但這個力量實際上在去年冬天遭受了太多的水，水分循環有點逆轉了。更具體地說，他們的許多地塊都位於加州的三角洲地區，那裡的補給地下水不斷上升，再加上一些鹽度問題，導致植物的根部明顯腐爛，這是你甚至無法做到的。幾個月看到它發生得非常非常快

So it was marginally located land and frankly, operator that in retrospect made some decisions that were, you know, frankly, the wrong decisions. So that's why we are characterizing this as idiosyncratic. We do not feel that our permanent crop portfolio has other issues, including systemic issues associated with that. Let me just turn to Marc to give you some insight into the analysis we've done to get to that conclusion as of today.

因此，它是位於邊緣的土地，坦率地說，運營商做出了一些決定，坦率地說，是錯誤的決定。這就是為什麼我們將其描述為特殊的。我們不認為我們的永久性作物組合有其他問題，包括與之相關的系統性問題。讓我請馬克向您介紹我們為得出今天的結論所做的分析。

Yeah, I'll start out by talking about this loan in particular. It turns out this borrower was a poor operator. That happens on occasion. Brad mentioned that this borrower had a number of acres in what I'll describe as poor growing regions, ironically too much water instead of not enough in this past last six months or so.

是的，我首先要特別談談這筆貸款。事實證明，這個借款人是個糟糕的經營者。這種情況有時會發生。布拉德提到，這位借款人在我所描述的貧瘠種植地區擁有數英畝土地，諷刺的是，在過去六個月左右的時間裡，水太多而不是不足。

In addition, this borrower was in bankruptcy. And as part of that bankruptcy, there was an auction that was held under a pretty tight time frame your view is that that tight time frame they have suppressed you know buyer interest and potentially have reduced sale prices.

此外，該借款人已破產。作為破產的一部分，有一次拍賣是在相當緊張的時間範圍內舉行的，您認為，在緊張的時間範圍內，他們抑制了買家的興趣，並可能降低了銷售價格。

And the borrower was a relatively large producer and many thousand acres were put on the market all at once you know had we you know had a little more input into the way that auction would have been held, we would have sort of you know had those acres sort of sold over time rather than all at once.

借款人是一個相對較大的生產商，數千英畝的土地一下子就被投放到市場上，如果我們對拍賣的舉行方式有更多的投入，我們就會知道，如果這些英畝是隨著時間的推移而不是一次性全部出售的。

And Bill I'll address your question around the charge off and we have had a history of where we charged and then recovered. In this case we don't think that's going to happen. As part of the most recent sale of land, about 90% was sold, not all of it, but about 90%.

比爾，我將解決你關於充電的問題，我們有充電和恢復的歷史記錄。在這種情況下，我們認為這種情況不會發生。作為最近出售土地的一部分，大約有90%被出售，不是全部，而是大約90%。

And so we have pretty good insight into where we think our recovery is going to be and therefore we decided to take a charge rather than an allowance. And so given a lot of those issues that I mentioned, we don't think this sale is representative of other situations in our portfolio, but of course we're keeping a close eye on all that.

因此，我們對我們的復甦前景有很好的了解，因此我們決定收取費用而不是津貼。因此，考慮到我提到的許多問題，我們認為這次出售並不代表我們投資組合中的其他情況，但我們當然會密切關注這一切。

Okay, thanks for all that detail. And then one follow-up question for Brad. Just update on the farm bill, if you will. I've been reading that its passage looks like it's unlikely in 2024 and that the 2018 version is likely to be extended. Is that the case that you are reading it now or might there be any modifications to the 2018 bill?

好的，謝謝你提供的所有細節。然後是布拉德的一個後續問題。如果你願意的話，只需更新農業帳單即可。我一直在讀到它的段落看起來不太可能在 2024 年實現，而 2018 年的版本可能會延長。您現在正在閱讀的是這種情況還是2018年的法案可能會有任何修改？

Yeah, well, first of all, our current business does not depend on changes to the farm bill. As we've discussed, the couple, two, three matters in which we're potentially pursuing some changes as we envision them would be potential upsides to our business, but we really haven't baked that into our 2024 or even 2025 plan at this point. Is it relates to where is the farm bill? It sounds like you've been staying abreast of it and are reading many of the same things we are.

是的，首先，我們目前的業務並不依賴農業法案的變化。正如我們所討論的，我們可能會在這兩、三件事中尋求一些改變，因為我們預計它們會為我們的業務帶來潛在的好處，但我們確實還沒有將其納入我們的2024 年甚至2025年計劃中這一點。這與農業賬單在哪裡有關嗎？聽起來您一直在關注它，並且正在閱讀許多與我們相同的內容。

Todd Batta, of course, is spending a lot of time on Capitol Hill, but you're correct. Getting debate scheduled, much less agreement coming out of the senate version and their ability to release a draft bill. It just hasn't happened and frankly it's unlikely to happen, is our analysis between now and the election.

當然，托德·巴塔在國會山莊度過了很多時間，但你是對的。安排辯論，更不用說參議院版本達成一致以及他們發布法案草案的能力了。這是我們從現在到選舉期間的分析，它只是沒有發生，坦白說，它不太可能發生。

There is a slight possibility that depending on the outcome of both the Presidential Elections, as well as control of the house and the Senate, that there's a window between the election and the inauguration and the seating of the new Congress, when it actually could get some floor time and possibly be pushed through, that would be a scenario under which Republicans don't feel that they're going to sweep or control all three institutions. But of course, that remains to be seen.

根據總統選舉的結果以及參眾兩院的控制情況，選舉與就職典禮以及新國會就座之間有可能存在一個窗口期，而此時實際上可能會出現這樣的情況。推遲，在這種情況下，共和黨人不會覺得他們會橫掃或控制所有三個機構。但當然，這還有待觀察。

So our attitude right now is to continue to stay abreast of what's going on with both the House and the Senate committees. We're not expecting anything new out of them right now. To stay in touch with the various parties interested in what we're pursuing and frankly, what we may be interested in what they're pursuing. And to be prepared to answer questions and support any actions if that window does open up between the election and the inauguration. Otherwise, we're resigned. This will be 2025 and probably well into 2025.

因此，我們現在的態度是繼續了解眾議院和參議院委員會的最新動態。我們現在並不期待他們有任何新的東西。與對我們所追求的事物感興趣的各方保持聯繫，坦白說，我們可能對他們所追求的事物感興趣。如果選舉和就職典禮之間的窗口確實打開，則準備好回答問題並支持任何行動。不然我們就辭職了。這將是 2025 年，並​​且可能會持續到 2025 年。

Okay. Thanks for taking my questions.

好的。感謝您回答我的問題。

Brendan McCarthy, Sidoti.

布倫丹·麥卡錫，西多蒂。

Hey, good afternoon, everybody. Thanks for taking my questions. I just wanted to start off at the corporate ag finance loan that was sold. I think it was a $1.1 million loss. I believe you mentioned it was due to borrower concentration, but just wondering if you can walk us through that process and if you feel there are any other borrower capacity concerns in the portfolio.

嘿，大家下午好。感謝您回答我的問題。我只想從出售的企業農業融資貸款開始。我認為損失了 110 萬美元。我相信您提到這是由於借款人集中，但只是想知道您是否可以引導我們完成該過程，以及您是否認為投資組合中存在任何其他借款人能力問題。

Yeah, certainly, you know, it's an interesting one because here we have a situation where we have the secondary market, an active secondary market for the loan. So that gave us an ability based on analysis at the time to sell, albeit at a loss. But I'll turn to Zach for a little bit more color on why we were holding a particular level of exposure that we ended up wanting to sell down and why we're comfortable today as well.

是的，當然，你知道，這是一個有趣的情況，因為我們有二級市場，一個活躍的貸款二級市場。因此，這使我們能夠根據當時的分析進行銷售，儘管是虧損的。但我會向扎克尋求更多的信息，解釋為什麼我們持有特定水平的敞口，但我們最終想要拋售，以及為什麼我們今天也感到舒適。

Yeah, thanks, Brad. So I want to say that for this individual borrower, we were not comfortable at the origination of this loan at the concentration level. As we move forward and understood more about some of the industry headwinds and borrower specific headwinds this individual obligor was facing, we felt it prudent given there was a liquidity market to sell this loan to bright size our exposure knowing that there was some individual borrower issues that they were facing.

是的，謝謝，布拉德。所以我想說，對於這個個人借款人來說，我們對這筆貸款的集中度發放感到不滿。隨著我們繼續前進並更多地了解該個人債務人所面臨的一些行業逆風和借款人特定的逆風，我們認為考慮到存在流動性市場來出售這筆貸款以擴大我們的敞口規模是謹慎的，因為我們知道存在一些個人借款人問題他們所面臨的。

So I think we felt tactical to potentially mitigate any further deterioration that this borrower may have by reducing our exposure to what we felt was a more palatable level at the time. Post that sale, as I mentioned, the borrower has restructured his credit facilities, is experiencing better industry dynamics and has rectified the individual issues it was facing at some of its manufacturing plants.

因此，我認為我們採取了策略，透過減少我們當時認為更可接受的水平來緩解該借款人可能出現的任何進一步惡化。正如我所提到的，在出售之後，借款人重組了其信貸安排，正在經歷更好的行業動態，並糾正了一些製造工廠面臨的個別問題。

So I think we're optimistic that the outcome here could be improved in the future. We're comfortable with our exposure level. And we thought at the time it was just prudent to mitigate some further deterioration. In terms of the second part of your question, any additional borrower concerns or concentration, we actually feel pretty confident with our corporate ag portfolio that it's risk managed appropriately. We have updated risk ratings on a quarterly and annual basis, and we don't see any other individual concerns at this time.

因此，我認為我們對未來的結果可能會有所改善持樂觀態度。我們對自己的暴露程度感到滿意。我們當時認為，緩解進一步惡化的情況是謹慎的做法。就你問題的第二部分而言，任何額外的借款人擔憂或集中度，我們實際上對我們的企業農業投資組合非常有信心，因為它的風險管理得當。我們每季和每年都會更新風險評級，目前我們沒有看到任何其他個人問題。

I might just add that, you know, for our exposure levels, we actually have very refined kind of matrix guidelines that are based on the sector and risk ratings that we fall for maximum exposures. This loan did not exceed those maximum exposures. There were no policy or regulatory concerns associated with this, it just came down to judgment one day about what we thought was the right thing to do.

我可能只是補充一點，你知道，對於我們的風險敞口水平，我們實際上有非常完善的矩陣指南，該指南基於我們最大風險敞口的行業和風險評級。該貸款沒有超過這些最大風險敞口。沒有與此相關的政策或監管問題，這只是有一天我們對我們認為正確的做法的判斷。

Thanks, that's helpful insight. One more question, just looking at the farm and ranch outstanding volume, apologies if I missed this, but what really drove the sequential decline there from the first quarter of this year?

謝謝，這是很有幫助的見解。還有一個問題，只是看看農場和牧場的未完成交易量，如果我錯過了這一點，我很抱歉，但真正推動今年第一季以來連續下降的因素是什麼？

Yeah, I could take that one. So in the farm and ranch line of business, the big decline in volume was the maturity of large AgVantage bonds that took place during the quarter. I'll just highlight the driver of growth and decreasing growth and AgVantage really is dependent on our counterparties that we work with, which are large farm and ranch originators. As loan growth at those counterparties slows, the need for liquidity to support that growth also slows.

是的，我可以接受那個。因此，在農場和牧場業務領域，交易量大幅下降是由於本季大型 AgVantage 債券的到期。我只想強調成長和成長放緩的驅動因素，AgVantage 實際上依賴與我們合作的對手方，這些對手方是大型農場和牧場的發起者。隨著這些交易對手的貸款成長放緩，支持成長的流動性需求也會放緩。

What we saw over the last, I'd say, three months was a deceleration of growth at certain of these counterparties, and thus they did not need to refinance those maturing bonds. So as we navigate this environment with tightening credit spreads, loan growth, dynamics, we may see some volatility in refinancing some of those maturing bonds. Albeit, we still believe this product is a strong relative value to other funding sources, and as growth picks up, we expect to see potential growth opportunities arise.

我想說，過去三個月我們看到的是某些交易對手的成長放緩，因此他們不需要為這些到期債券進行再融資。因此，當我們在信用利差收緊、貸款成長、動態變化的環境下應對時，我們可能會看到一些到期債券的再融資出現一些波動。儘管如此，我們仍然相信該產品相對於其他資金來源具有強大的相對價值，隨著成長的加快，我們預計會出現潛在的成長機會。

Brendan, just something to add here. I think we've talked to you, you know, on previous calls as well as offline that, you know, in 2020 we certainly saw some volatility in the AgVantage portfolio and a lot of this has to do with what other sources of funding opportunities are available to those counterparties and where we want to be on the pricing curve. I think, Zach, in the business development team had made some strategic decisions then, which actually have come to fruition now.

布倫丹，這裡要補充一點。我想我們已經在之前的電話會議以及線下與您交談過，您知道，在 2020 年，我們確實看到了 AgVantage 投資組合的一些波動，其中很大一部分與其他融資機會來源有關可供這些交易對手以及我們希望處於定價曲線上的位置。我認為扎克當時在業務開發團隊中做出了一些戰略決策，現在實際上已經實現了。

So on a relative value basis, what we offer those counterparties is still really good value. So I think, you know, we don't obviously know where the projections are headed, but I think Zach encapsulated that well. We foresee that to start to stabilize over time, but we just don't know that.

因此，從相對價值的角度來看，我們為這些交易對手提供的服務仍然非常有價值。所以我認為，我們顯然不知道預測的走向，但我認為扎克很好地概括了這一點。我們預計隨著時間的推移，這種情況會開始穩定下來，但我們只是不知道這一點。

That makes sense. I guess that includes potentially lower interest rate environment. You still see the value proposition of that business remaining favorable.

這是有道理的。我想這包括潛在的較低利率環境。您仍然看到該業務的價值主張仍然有利。

Yeah, absolutely. And that comes back to our funding advantage. And you know, you hit the nail on the head. That's exactly right. So as rates start to come down, relative value proposition of what we might offer given our funding dynamics start to improve. So, you know, that's just something to consider as well. Not making any projections, but that's just another [time].

是的，絕對是。這又回到了我們的資金優勢。你知道，你說得一針見血。完全正確。因此，隨著利率開始下降，考慮到我們的融資動態，我們可能提供的相對價值主張開始改善。所以，你知道，這也是需要考慮的事情。不做任何預測，但這只是另一個[時間]。

Yeah, that's helpful. That's helpful. Thanks, Aparna. One more question, if I may, just out of curiosity, looking at the outlook for renewable energy, volume growth, there seems really solid. Just curious as to if you think that outlook may change if there were to be a change in presidential or I'm sorry in the administration as a result of the US presidential election?

是的，這很有幫助。這很有幫助。謝謝，阿帕娜。還有一個問題，如果可以的話，我只是出於好奇，看看再生能源的前景，銷量成長，似乎確實很穩固。只是想知道，如果美國總統大選導致總統更迭，或者我對政府感到抱歉，那麼前景是否可能會改變？

Yeah, it's an interesting question because we could see policy changes in Washington with an election of President Trump, for example. Right now, our market share is tiny and it's probably the largest addressable market we have. One of the nice things about our positioning is that the federal tax incentives for renewable energy are all available and put in place at the time a deal closes.

是的，這是一個有趣的問題，因為例如，隨著川普總統的當選，我們可以看到華盛頓的政策改變。目前，我們的市場佔有率很小，但這可能是我們擁有的最大的潛在市場。我們的定位的好處之一是，針對再生能源的聯邦稅收激勵措施全部可用，並在交易完成時落實到位。

So for the existing portfolio, we don't have any concerns about deteriorating quality because of a change in federal policy, and that's really important to emphasize. In terms of growth rates, we've been putting in place additional teams, additional resources, and you see a direct response of that to growing levels of origination, both on a percentage basis, as well as a notional dollar basis. And that's our near-term expectation here, that we're going to continue to grow this.

因此，對於現有的投資組合，我們並不擔心由於聯邦政策的變化而導致品質下降，這一點非常需要強調。就成長率而言，我們一直在組建更多的團隊、更多的資源，你會看到這對不斷增長的起源水平的直接反應，無論是在百分比基礎上，還是在名義美元基礎上。這是我們的近期預期，我們將繼續發展這項業務。

It's going to provide us opportunities in the future of potential additional types of securitization opportunities. You've seen the very positive accretive NES, including accretive NES on a capital adjusted basis. So, it's something easy for us to commit to continue growing. If there is a change in policy in Washington that it would result in slowing down, it's also something that we can just slow down very easily without any negative consequences to the portfolio.

它將為我們提供未來潛在的其他類型證券化機會的機會。您已經看到了非常積極的 NES 增值，包括資本調整後的 NES 增值。因此，我們很容易致力於繼續發展。如果華盛頓的政策發生變化，這將導致經濟放緩，那麼我們也可以輕鬆放緩步伐，而不會對投資組合產生任何負面影響。

But right now, it's a good opportunity and it balances out the increases in volume for new farm and ranch originations, and overall stability in other areas of rural infrastructure. So we're very happy with where it is, keeping an eye, of course, on federal legislation changes that could come about.

但現在，這是一個很好的機會，它平衡了新農場和牧場數量的增加以及農村基礎設施其他領域的整體穩定性。因此，我們對目前的情況非常滿意，當然，我們會密切關注可能發生的聯邦立法變化。

That's helpful. Thank you, Brad. That's all from me.

這很有幫助。謝謝你，布拉德。這就是我的全部。

Gary Gordon.

加里·戈登.

Hi, thanks for taking the question. Two questions on the charged-off loan. One is, my understanding is the general loan-to-value ratio you do is around 55%. This implies the charge-off implies some material decline in the value of that land. If you could add some color to that. And then two, you mentioned that you seem to have not as much control as you wanted, about the bankruptcy process, as the first mortgage lender, so what are your rights there? Is this normally what happens, that you wouldn't have as much control or is there something unusual here?

您好，感謝您提出問題。關於沖銷貸款的兩個問題。一是，我的理解是你們做的貸款價值比一般在55%左右。這意味著註銷意味著該土地的價值會出現一些實質下降。如果你能為它添加一些顏色的話。第二，你提到，作為第一個抵押貸款機構，你對破產程序似乎沒有你想要的那麼多控制權，那麼你在那裡有什麼權利？這是正常情況下會發生的情況嗎？

Yeah, those are both really, really astute questions, Gary. You know, on the first, imagine that you have a permanent crop land that is improved, that has an orchard of almonds, for example, and imagine that in a period of just a couple of months, the water situation results in the death of all those almond trees, leaving you with bare land.

是的，這些都是非常非常敏銳的問題，蓋瑞。你知道，首先，想像你有一塊經過改良的永久性農田，例如，有一個杏仁園，然後想像一下，在短短幾個月的時間內，水的狀況導致了植物的死亡。樹，給你留下了光禿禿的土地。

So that's how you navigate from what appears to be a modest loan to value to one, that actually could result in one with a loss. In terms of the second part of the question with the control, Marc, maybe you can take Gary through kind of a discussion of where we were relative to other lenders in the size of the facilities.

因此，這就是您如何從看似適度的貸款轉為有價值的貸款，而這實際上可能會導致損失。關於控制權問題的第二部分，馬克，也許你可以帶加里討論一下我們相對於其他貸方在設施規模方面的情況。

Yeah, I think that's the first thing to note, Gary, is that we were part of a bank group, and we were a relatively small part of the bank group. I mentioned that borrower with a large producer, lots of acreage. We were a small part of that. And so other lenders had a voice and a view on the bankruptcy process. And so that's why it played out the way it did.

是的，我認為首先要注意的是，加里，我們是銀行集團的一部分，而且我們是銀行集團中相對較小的一部分。我提到借款人擁有一家大型生產商，擁有大量種植面積。我們只是其中的一小部分。因此其他貸方對破產程序有發言權和看法。這就是為什麼它會這樣發展。

To give us perspective, I think the largest lender [Marcus] over a $100 million?

為了給我們一個視角，我認為最大的貸款人 [Marcus] 超過 1 億美元？

Yeah, that's right. We were about 10%, I would say, round numbers of the overall bank facility.

是的，沒錯。我想說，我們大約佔銀行整體信貸額度的 10%。

Okay, got it. Thank you very much.

好的，明白了。非常感謝。

Bill Ryan, Seaport Research Partners.

比爾·瑞安，海港研究合作夥伴。

Thanks. Just a follow-up for Aparna. I was looking at the NES in the corporate ag finance business went from 205 basis points down to 191 basis points. I'm kind of guessing that might have related to the charged off loan, but anything you could call out there would be helpful.

謝謝。只是阿帕娜的後續。我看到企業農業金融業務的 NES 從 205 個基點下降到 191 個基點。我猜這可能與已註銷的貸款有關，但您可以在那裡提出的任何內容都會有所幫助。

Yeah, absolutely. There's some non-accruing portion that has sort of built up, And so that's exactly right. That is one of the drivers. And just the sale that we talked about, that's a component of having reduced our exposure within the corporate ag portfolio just on an NES, from a math perspective. That's been the largest driver, I would say, of that sequential decline.

是的，絕對是。有一些非應計部分已經累積起來，所以這是完全正確的。那是其中一位司機。從數學的角度來看，就我們所討論的出售而言，這只是 NES 上減少我們在企業農業投資組合中的風險敞口的一部分。我想說，這是連續下降的最大驅動因素。

Okay, thanks.

好的，謝謝。

There are no further questions at this time. I will hand the call over to Brad Nordholm for closing remarks. Sir, please go ahead.

目前沒有其他問題。我將把電話轉交給布拉德·諾德霍姆 (Brad Nordholm) 致閉幕詞。先生，請繼續。

Good. Well, thank you. And thank you again, everyone, for joining us today. Good discussion, good presentation. As always, if you have follow-up questions, please get in touch with Jalpa. Otherwise, we look forward to speaking with you at our regular schedule call in November and hope that you have a terrific completion to the summer and in early fall.

好的。嗯，謝謝。再次感謝大家今天加入我們。很好的討論，很好的演講。與往常一樣，如果您有後續問題，請與 Jalpa 聯繫。除此之外，我們期待在 11 月的定期電話會議上與您交談，並希望您在夏季和初秋取得圓滿成功。

Hopefully these markets will show some stabilization in the next few days. But again, thank you very much and good day.

希望這些市場在未來幾天內能表現出一些穩定。但再次非常感謝你，祝你有美好的一天。

Ladies and gentlemen, this concludes today's conference. Thank you very much for your participation. You may now disconnect.

女士們、先生們，今天的會議到此結束。非常感謝您的參與。您現在可以斷開連線。