May 1, 2022
Dear Farm Credit East Customer:
There are two integral concepts that are part of Farm Credit East’s “organizational DNA” — voice and membership. Membership, or ownership, is the first. As a cooperative, we’re focused on our members’ success. The second concept is that members are also owners and in a cooperative are given a voice through their role in governance.
Our recent spring Financial Partner magazine goes to the heart of that concept as we provide insight into the many facets of our cooperative’s governance. It concludes the series we started with last summer’s issue on Farm Credit East’s Environmental, Social, and Governance (ESG) initiatives.
There are many reasons for Farm Credit East’s long-term success, starting with our amazing customers and our talented team. Together, we’ve built a financially strong cooperative that has met the challenges of the cycles in agriculture, forestry and fishing, and helped our members do the same. Through the decades, Farm Credit East has maintained the capacity to withstand credit challenges and meet the financing needs of our customers. And that capacity has been enhanced through the merger with Yankee Farm Credit that became effective January 1, as Yankee had a similarly strong track record of financial results.
In addition to maintaining that financial strength, Farm Credit East continues to return the earnings not needed to capitalize or operate the association to members in the form of patronage dividends, for an average effective interest rate reduction of 1.25%. Since its formation, Farm Credit East and predecessor associations have now returned over $1 billion to our customer owners.
From an accounting perspective, that financial capacity has been achieved through yearly operating results, however the foundation it is built upon is sound cooperative governance and the financial stewardship of the board of directors. That’s because they keep members’ interests as their top priority and have a long-term perspective as they set the strategic direction for the organization.
Achieving sound governance takes work, and it starts with broad-based customer engagement. Farm Credit East engages members in a variety of ways, including through customer communications and meetings, local branch Customer Service Councils and the association’s Nominating Committee. In 2022, Farm Credit East will be refreshing its customer engagement strategy and building on existing programs, with changes such as the inclusion of young producers on all branch Customer Service Councils to ensure input from the next generation of Farm Credit East members. Please let your local branch manager know if you’re interested in getting more involved at Farm Credit East.
As spring kicks into full swing in the Northeast, I wish everyone the very best for a successful growing season.
Michael J Reynolds
Chief Executive Officer
Farm Credit East, ACA