Farm Credit Services of America (FCSAmerica) recently modified its patronage program, offering increased benefits to its customer-owners.
Jim Knuth, senior vice president of FCSAmerica, says these changes allowed the financial cooperative to issue its largest return to date.
?We paid out the largest cash-back dividend in the history of our program, one-percent of their eligible loan balance. Again, that?s allowed us to return a record share of earnings to our customer-owners. In Iowa, that amounted to $103 million,? Knuth said.
FCSAmerica’s customer-elected board of directors each year chooses how to distribute annual earnings, says Knuth.
“It goes back to our unique, cooperative business model,” Knuth said. “We do one of two things with our earnings -Keep a portion to adequately capitalize our business and have financial strength for future generations or return a portion of our earnings directly to our customer-owners.?
FCSAmerica’s recent pay out exceeds the previous record, set in 2018 – 90 basis points, or 0.90 percent of a customer’s eligible daily loan balance. The cooperative also delivered cash-back dividends early, according to Knuth
?Traditionally those checks have gone out in mid- to late March. We sent checks out in late January, and that?s (been) a great change,” Knuth said. “Our goal was to move up the distribution of our cash-back dividend to maximize the impact our patronage program has by getting it into the hands of our customer-owners as they plan for a new production season.?
FCSAmerica is proud to support agriculture and its customer-owners.
“We?re pleased to return this benefit to our customer-owners over the last 16 years. We hit a milestone, paying over two-billion-dollars back in cashback dividends and there?s more to come,” Knuth said.
