Mike's Blog

December 2011

2011-12-20T15:03:00.001-05:00

As winter quickly approaches, we begin to reflect on 2011 and work toward finalizing our business planning process for 2012.

2011 has brought many challenges to our customers as many continue to be affected by the slow recovery of our general economy. The local economy in our territory is generally intermingled with influences from the agriculture, industrial, retail and housing industries. The economic factor that has had the most impact on many of our customers has been the soft real estate market. As you know, for the majority of our customers, their most valuable asset is their farm or home. Additionally, many have invested in rural real estate in recent years. As income and cash flows have continued to be adversely affected by the slow economy, those who typically would liquidate real estate assets to strengthen their financial condition, have been unable to do so because of the soft market. As a result, we continue to work with many customers to help them through this difficult time. While we all would love to see signs of significant improvement in the overall economy, there are no such signs evident on the horizon. I recently heard the CEO of the Farm Credit System Funding Corporation speak and he indicated that from an economic recovery standpoint, we as a nation may still be in the 4th inning of a 9 inning game. If that is the case, we have several years of slow growth ahead. We pledge to continue to work hard to provide the needed products and services to help you work through these tough economic times.

On a sad note, our Carolina farm Credit family lost an extraordinary leader, strong supporter, and a true friend on October 2, 2011 when Director Bobby Joe Gambill passed away after a long and courageous battle with cancer. Bobby Joe loved people and was always willing to help others. He served our membership well as a director for over 15 years and his leadership and presence will be truly missed in our boardroom.

I am pleased to report that our Board has appointed Susie J. Gambill to fill the vacant seat on our Board created by her husband’s passing. In addition to her involvement in the family farming operation, Susie serves as the Clerk of Court in Alleghany County. She has a bachelor’s degree in Business and Education from Appalachian State University and is very involved in the local and agriculture community. Susie is a capable leader who will serve our membership well and we welcome her to the Board.

Hopefully, you had a chance to attend the customer appreciation event that was held during October in your local service center. It is always good to visit with our members and even better when we can hand deliver allocated surplus checks and “Put Our Profits In Your Pockets.” We look forward to visiting with you as we hold another round of customer appreciation events in the spring.

Fall 2011

2011-09-28T14:10:00.002-04:00

As we approach the fall of the year and the full swing of harvest, we also get a glimpse of cooler nights and lower humidity. The heat of summer, while very necessary for our crops to grow, does make it much easier to appreciate the cooler temperatures that arrive with fall and the changing color of the leaves. It takes all seasons to complete the lifecycle which is the foundation for most everything in Agriculture.

This time of year also brings us to another director election cycle at Carolina Farm Credit. The fundamental difference between Carolina Farm Credit and other financial institutions is that we operate as a true cooperative. As such, we are owned by the same people who use our services and we return the majority of our profits each year to our members in the form of a patronage refund.

On September 20, we completed the 2011 director election by mail after receiving 533 ballots. All incumbent directors were re-elected to serve a five year term: Bobby "Bud" J. Matthews, Yadkin County; Thomas E. Porter, Jr., Cabarrus County; and Clark M. Newlin, Alamance County.

This year, there were only three seats on the board up for election. In accordance with our bylaws and a board reduction plan, as board members vacate their seat in the future, those seats will be eliminated until the plan is final. The final plan calls for a board of 14 directors made up of 12 directors elected by the membership and two outside directors appointed by the board, all of which will serve 5 year terms.

Directors R. Dwayne Myers and Charles L. “Butch” Deal have made the decision to retire from the board after many years of service to Carolina Farm Credit and its membership. Mr. Deal is a Grain, Tobacco, Beef Cattle, Vegetable and Fruit Farmer from Macon County and has served on the board for over 19 years. Mr. Myers is a Dairy Farmer from Wilkes County and has served on the board for over 35 years. These gentlemen have served your Association faithfully during a very critical period in Farm Credit’s history. They are true statesmen who have always put your interests first when making decisions. While we understand their decision, we acknowledge that their knowledge and experience will be greatly missed in our boardroom. I would like to personally thank both Mr. Myers and Mr. Deal for their service to Carolina Farm Credit and the positive impact they have had on our organization.

During the month of October, we will again hold fall customer appreciation events in each of our 36 service centers. Please be looking for your invitation to your local customer appreciation event to arrive in the mail. We will be serving good food, good fellowship and most importantly we will be distributing surplus allocated checks. This highlights why borrowing from a cooperative makes economic sense and is our way of saying “Thanks” for doing business with Carolina Farm Credit.

We continue to use our customer service surveys to give you an opportunity to tell us how satisfied you are with the level of service we are providing. Our goal is to provide service that exceeds your expectations. There is always room for improvement in any organization. However, the only way we will know where improvement is needed is by you completing the survey and returning it for our records. Please take a few minutes to complete the surveys when you receive them in the mail. Thus far in 2011 we have received almost 600 surveys with an average score on all responses of 4.72 out of a 5.0 possible score. We are very pleased that you feel this way about the service that we provide. I am very aware that it is our dedicated staff that is responsible for developing our relationship with you and making these results possible. When our staff goes out of the way to provide you with excellent service, please take a minute to let them know. Nothing goes as far as a simple pat on the back to generate more excitement and energy to provide even better service in the future. Thank you for allowing us to serve your credit needs. We will look forward to seeing you at our fall customer appreciation events.

Spring 2011

2011-05-13T13:03:00.003-04:00

In no other industry or place can we recognize spring more than in agriculture and rural America. From trees blooming, grass getting greener, time changing and days getting longer and folks scurrying around their farms making preparations for planting; everything in rural America says springtime is here. One of the most intriguing aspects of agriculture is the opportunity to be involved throughout the entire life cycle. We prepare, plant, nurture, harvest, and then we have springtime and start all over again. So it is with farming, so it is with business, and so it is with life.

At Carolina Farm Credit, just as on your farm, we have closed out 2010 and started our process all over again to ensure your financial needs are being met. I hope you have had a chance to review our recently published 2010 Annual Report. We had another very successful year and again, your Board of Directors declared a patronage refund which was paid in April. We exceeded our goal of returning 20 cents on every dollar you paid in interest as our 2010 patronage refund represents 23.5 cents of each dollar of interest.

Additionally, we held Customer Appreciation Events (CAE) in each of our 36 service centers during April to distribute patronage checks and say thank you for your business. We hope you enjoy the CAEs as much as we do. It’s always nice to sit and visit with members that we don’t see on a daily basis, especially since we consider our customers as friends and family.

In March, we completed our 11th annual Agricultural Leadership Institute in Asheville. This year we hosted 17 young, beginning, small, or minority farm couples for a weekend of education which is designed to better enable them to be successful in agriculture and establish relationships with other similar producers across our territory. We have also just completed our second year of the Ag Biz Planner program. This program involved 11 young, beginning, small, or minority farm couples and provided additional education to include the actual preparation of a business plan for each operation. I continue to be impressed with the quality of the individuals who are involved in agriculture and attend these programs. It is very rewarding to have the opportunity to invest in the future of NC agriculture by investing in the lives of these folks. Each year I come away more convinced than ever that the future of agriculture, in our area, is in good hands.

Ag Biz Planner participants and mentors

Dr. David Kohl at Ag Leadership

Ag Leadership participants

January 2011

2011-01-28T08:29:00.000-05:00

2010 was another very successful year for Carolina Farm Credit (CFC). On behalf of our Board of Directors and staff, I would like to say thank you for the contributions you have made to our success. Without members who are committed to use our products and services, and who continue to recommend CFC to friends, neighbors and family, we could never be as successful as we have been.

As a cooperative, we strive to provide value for your ownership in Carolina Farm Credit. To this end, your Board has again approved the payment of a patronage refund on 2010 earnings. Our expectation is to exceed our goal of returning $.20 on every dollar of interest that accrued on your loan in 2010. This marks the 23rd consecutive year that our operating results have allowed and your Board has approved payment of a patronage refund, therefore living up to our motto of “We put our profits in your pockets”. Watch for your invitation in the mail and please join us at your local customer appreciation event in April to pick up your patronage refund check and enjoy good food and fellowship as our way of saying thanks for your business.

We continue to be challenged to provide a high level of service and operate more efficiently in today’s environment. We are constantly looking for ways to gain efficiencies and control cost just as you are on your farm. As a result of issues affecting both our Reidsville and Greensboro service centers and in an effort to gain efficiencies and better utilize our human resources; effective March 31, 2011, we will close our Greensboro service center and consolidate it into our Reidsville service center. We will immediately begin searching for a suitable location, as close to halfway as possible between these two locations, to purchase land and construct a new service center building to serve our Guilford and Rockingham County customers.

We appreciate the business of our members in both of these counties and the relationships we have built over the many years we have provided service in these locations. We continue to be committed to providing quality service that exceeds your expectations and comfortable and convenient offices in which you can conduct your business. We believe that when our new service center is complete you will have a service center that you will be proud of.

September Updates

2010-09-10T15:17:00.000-04:00

Local Control

Carolina Farm Credit’s director elections are now underway. Please look for your ballot to arrive in the mail and take the time to mark your ballot and return it as instructed. Carolina Farm Credit is a cooperative and your vote ensures the direction of our association is controlled by local farmers from communities just like yours.

Allocated Surplus Revolvement

I am very pleased to report that our Board has once again approved the revolvement of Allocated Surplus for this fall in the amount of $7.6 million. This revolvement will include both Qualified and Non-Qualified Allocated Surplus; therefore, it will be paid in two separate checks. We take our patronage program seriously, and therefore, are committed to living our motto “We Put Our Profits in Your Pockets!”

Because our Board members are farmers that live and operate within your local communities, they understand that many of our members continue to be impacted by the sluggish economy. Therefore, after determining that the association is adequately capitalized, they understand the importance of returning cash now when many of you need it more than ever.

Fall Customer Appreciation Events

The Board has also approved the reinstatement of Fall Customer Appreciation Events (CAEs) this October in each of our 37 service centers. Be looking for your invitation in the mail and hopefully you can arrange to attend your local CAE. Good food – Good fellowship – Pick up a couple checks…just a few good reasons to do business with Carolina Farm Credit. I look forward to visiting with as many of you as possible during the October CAEs.

2010-08-18T15:00:00.000-04:00

At Carolina Farm Credit, we value the relationships we have with our borrower/owners. Our goal is to provide superior customer service and to exceed our customers’ expectations.

One of the ways we measure whether or not we are meeting this goal is through our customer satisfaction surveys. Each month I review the results of these surveys and I always enjoy reading the positive comments written by customers about their experience with CFC.

Even though the vast majority of scores and comments are high and positive, there are occasionally surveys where some portion of the customer’s experience, for one reason or another, did not meet their expectations. When this occurs I research each situation and respond to the customer personally. We make every effort to learn from each situation to keep something like it from reoccurring in the future.

Well, July was an exceptional month - not one negative survey was received. Basically, the entire group of surveys was extremely positive. Survey after survey, had positive comments - many mentioning our employees by name. Below are a few of the comments we received this month:

Asheville customer: “We have done business with you for 36 years. Have always been very satisfied with the service.”

Graham customer: “Best loan experience ever.”

Carthage customer: “We have been a continuous CFC customer for 15 years. Extremely satisfied. CFC has been a centerpiece/foundation for our operations. We consider CFC as part of us and our success story.”

Ellerbe customer: “The Ellerbe Service Center has an outstanding and professional staff.”

Monroe customer: “The service we received was excellent. We received assistance as if the branch had known us for years.”

Yadkinville customer: “Everyone at the Yadkinville office has been very accommodating and kind. I could not be more pleased.”

Yanceyville customer: “The Yanceyville Service Center is absolutely wonderful. I will never go anywhere else for my loan needs. No one can beat the wonderful and friendly atmosphere.”

I fully understand that the results don't just happen. They are the result of the dedicated efforts of a group of exceptional people that have a passion for serving Agriculture and Rural America. We appreciate the trust you put in our employees and we take our commitment to provide excellent service seriously. We understand the importance of exceeding your expectations and we are proud to serve you.

2010-06-09T14:29:00.006-04:00

During the month of April, Carolina Farm Credit held customer appreciation events in each of our 37 service centers. This is one of the highlights of our year, when we take time to stop, say thank you and show appreciation to you, our customers, for doing business with Carolina Farm Credit. The events were well attended and we trust that each customer that attended enjoyed the food, fellowship, and time spent with our staff and other customers. For me personally, it was great to see many of our customers that quite frankly, I just don’t get to visit with often enough. Of course, the distribution of our patronage refund checks is a big drawing card for these events. We were pleased to be able to pay approximately $15.5 million in patronage to our customers this spring. Of that amount, we distributed approximately $4.6 million in cash during our spring customer appreciation events. As you know, the return of our profits to our customers through our patronage program is what sets us apart from other lenders in our area. The Board recently approved the association re-establishing customer appreciation events in the fall. We are already looking forward to seeing you again this fall and distributing more checks.

On a legislative front, there has been much talk of financial regulatory reform in Washington since the meltdown on Wall Street in the fall of 2008 and the ensuing aftermath with its effect on the banking industry. Recently, the Senate passed its version of regulatory reform legislation to go along with the House bill that was passed at the end of last year. The bill now goes to a House-Senate Conference Committee, which will begin meetings to work out the differences between the two bills. Farm Credit’s focus will be to influence the final structure of the bill where possible. We will work to ensure that the system is not adversely impacted as a result of difficulties experienced by other financial institutions and not shared by the Farm Credit System. Our efforts will focus on maintaining language in the House and Senate bills which supports FCA as the system’s regulator. We are working to ensure new legislature does not have an adverse affect on our customers. Additionally, the system will support provisions in the House bill that could, if removed, increase the cost of funding for system borrowers. As always, we are making every effort to support agriculture and rural America, both locally by making loans in our chartered territory, and in our nation’s capital by supporting legislation that is positive for agriculture, rural America and the Farm Credit System.

Thank you again for your continued use of Carolina Farm Credit’s products and services. We look forward to continuing to serve your credit and financial services needs in the future. See you in your office in the fall!

Carolina Farm Credit - Weathering the Storm

2010-04-06T14:05:00.016-04:00

We have just recently released our 2009 Annual Report entitled "Weathering the Storm." The past twenty-four months and more importantly, 2009, has certainly been seen as a "financial storm" for many in the financial services industry, and in many personal households as well. Although we continue to face difficult economic circumstances, Carolina Farm Credit is still standing strong supporting agriculture and rural America with our lending and financial services.

Certainly, we have all been touched in some way, form or fashion by the economic challenges we face as a nation. Although we have encountered our share of difficulties while managing through this financial "storm," our core earnings have remained intact, and we again finished 2009 with net income of more than $20 million. More importantly, during the month of April, we will be distributing $15.5 million of 2009's earnings to our members through our Patronage refund program in the form of cash and allocated surplus. This will be the 22nd consecutive year that we've paid a Patronge refund, which allows us to live up to our motto, "We Put Our Profits In Your Pockets." This also allows us to meet our goal of returning 20% of your accrued interest as Patronage and reduces your effective cost of borrowing. Carolina Farm Credit remains sound financially and adequately capitalized to ensure we are here to serve agriculture and rural America in difficult financial times as we have recently experienced, as well as in the good times.

You can read more about Carolina Farm Credit's financials by clicking on the following link: http://www.carolinafarmcredit.com/financials/Assn07_Job15632_CarolinaFarmCredit_2009AnnualReport-WEB.pdf however, I'd like to give you a brief update on the Farm Credit System as a whole and its performance over the last few years. While we all have worked to weather the current financial storm, the Farm Credit System as a whole has kept its conservative strategy and a focus on our borrowers' needs, which has allowed our performance to remain consistent through these difficult financial times. Jamie Stewart, Chief Executive Officer of the Federal Farm Credit Bank's Funding Corporation recently put it this way, "Because we had this special responsibility (lending to agriculture), we went into the financial crisis with lots of liquidity and a good portfolio. In the worst days of 2008, we didn't turn down a single borrower because we couldn't get the money. I doubt if any other lender can make that claim, and I'm very proud of that."

The Farm Credit System had record earnings in 2008 of $2.9 billion and ended the year in 2009 only slightly below that record level at $2.8 billion. The system demonstrated to the market that we could build capital in spite of significant reserves set aside for loan losses as a result of the downturn in the general and ag economy, which adversely affected many borrowers. The system as a whole did a good job of tightening expenses during these difficult economic times, and by doing so was able to conserve capital. By doing this, we were able to increase our ratio of equity to assets and prove that the system's business model works well in times of stress, allowing us to retain our financial strength while continuing to serve our customers. These items along with a moderated growth and increased liquidity allowed Farm Credit as a system to maintain its AAA mortgage-backed security rating, which allows the system to hold down its cost of funds, and translates into a lower cost of borrowing for our customers.

Obviously, we will face many issues in the future that threaten agriculture and our ability to provide financing needed for its success. Many of the issues that we see on the horizon will be controlled by Capitol Hill, and bad policy decisions can hurt the Farm Credit System despite its solid track record. Agriculture and the Farm Credit System need to strengthen our efforts on the political scene, so we can ensure agriculture's voice is heard. Stewart recently said, "The Farm Credit System has an opportunity to be a role model for the financial world. With grounded and conservative management, and a sharp focus on its borrowers, agriculture's lender is well positioned for the future."

On behalf of our Board of Directors and staff, I'd like to take this opportunity to thank everyone involved in agriculture and rural America for the part you play in making the Farm Credit System successful, providing the best, most enjoyable lifestyle in America, and feeding and clothing the world.

2010-01-20T12:12:00.008-05:00

Building Partnerships is Important to Success in Agriculture

I recently had the opportunity to attend the 21st Annual Joint conference of The Corn Growers Association of North Carolina, The NC Cotton Producers Association, The NC Small Grain Growers Association and The NC Soybean Producers Association. The conference was held in New Bern, NC and while it was a little chilly for New Bern, I'll have to admit it was nice to feel outside temps around the 60 degree range for a change. It was also very nice to see and talk to our members, many of which I have not seen in a while.

The theme for the conference was "Building Partnerships." Although many awards were presented to individual producers from each of the commodity groups for outstanding yield achievement; it was clear from talking to those in attendance that it takes partnerships with many people to reach these levels of success.

I was invited to participate in a panel discussion centered on "Building Partnerships," along side Wade Byrd, a Bladen County farmer; Lowell G. Taylor, a CPA from Williamston, NC; and Rick Holder, a Gas and Fertilizer supplier form Kinston, NC. It was obvious from the discussion that agriculture is a relationship business. Just as we at Carolina Farm Credit strive to transform loaning money, a transaction, into a relationship building process; it is clear that other parts of the agriculture sector also recognize the need to do the same.

The key to building relationships is to begin by building "trust," a foundation on which all mutually beneficial relationships must be built. Once trust has been established, it is critical to maintain good communications so the relationship can thrive.

At Carolina Farm Credit, our employees and directors know and understand agriculture. Our desire is to build relationships with our customers that will span generations. A critical objective is to operate and manage our business in a way that allows us to be successful and stable to ensure we are here to serve our customers in difficult economic times as well as in the good times. Our pledge is to remain a customer focused company, building long term relationships, and to continue to meet this objective.

(Above pictured L-R are Rick Holder, Wade Byrd, Mike Morton and Lowell Taylor, at right pictured L-R are Rick Holder, Wade Byrd and Mike Morton, both photos were taken during the panel discussion, photo courtesy of Jim Haskins, AgriBusiness Communications Group)

2009-12-15T12:08:00.011-05:00

I hope everyone had a restful and relaxing Thanksgiving. In spite of the current challenges with our economy, we all have so much to be thankful for. It was good to slow down a bit over the Thanksgiving holiday and take time to enjoy family, friends and reflect on our many blessings.

I know some of you are aware of the first ever Keepin' It Rural video contest that's been running in the AgFirst Farm Credit district. This contest gives you, our customers and friends, an opportunity to show us some of our favorite things about living the rural life. In other words, show us how you're keepin' it rural!

As this contest draws to an end, I've taken time to watch several of the videos submitted by customers and friends of Farm Credit. What a great group of videos we received - there's lots of talent out there! We have some very funny submissions, several with kids and families, lots of animals and some breath-taking landscape shots.

The winners have been selected and will be announced as soon as the legal folks are satisfied with signatures from all the winners. In the mean time, take a few minutes to watch some of these amazing videos. The videos will make you smile, make you laugh and make you proud you know what it means to keep it rural. http://www.ikeepitrural.com/ In addition, you'll want to fan our facebook page as we'll feature many of the videos in upcoming weeks. Carolina Farm Credit Facebook Page

Since Keepin' It Rural is about sharing what's fun and interesting about farm and country life, we've added a series of articles to the Ikeepitrural website about various issues related to that purpose. Some of the articles will be about hot-button topics while others might be about how stuff works around the farm. But, regardless of the topic, the goal is to shine a spotlight on rural America. We hope you enjoy! If you'd like to suggest a topic for us to write about, email it to us at ikeepitrural@agfirst.com

The 2nd Keepin' it Rural video contest is already underway, so get out our your cameras and start filming. You could be the $3000 winner next year!

I hope you'll slow down during the hustle and bustle of the next few weeks and reflect on the real reason we celebrate Christmas, take time to enjoy your family, friends and all that makes rural life a blessing!

2009-11-25T10:17:00.000-05:00

As we approach Thanksgiving, I can't miss the opportunity to tell you just how grateful I am to be part of our Carolina Farm Credit family, even as we collectively face challenging economic times.

Even with everything that life throws at us, we are so blessed and have so much to be thankful for. I would like to share something I recently heard that had an impact on me. If we are not careful we all can get caught up in our fast paced lives and simply inadvertently ignore the obvious blessing.

It went something like this: I am thankful for the taxes I pay, because it means I am employed....I am thankful for clothes that fit a little too snug, because it means I have enough to eat(thanks to a farmer somewhere).....I am thankful for a lawn that needs mowing, windows and bathrooms that need cleaning, because it means I have a home....I am thankful for the spot I find at the far end of the parking lot, because it means I am capable of walking.....I am thankful for the guy behind me who sings off key because, it means I can hear....I am thankful for the piles of laundry and ironing that needs to be done, because it means my loved ones are nearby.....And, I am thankful for the alarm clock that goes off much too early each morning, because it means I'm alive.

Please take the opportunity over the Thanksgiving holidays to slow down a little, spend time with your family and reflect on the blessings that we sometimes take for granted.