OTTAWA – For the second consecutive year, the Farm Credit Corporation made enough money to give some of it back to the Canadian government.
In the year ended March 31, it made a profit of $40.4 million.
Next September, it will pay a $2.7 #million dividend to the federal government, which over the years has written off hundreds of millions of dollars of bad FCC debt.
Last year, for the first time, the corporation paid a $4 million dividend to the federal government.
According to the 1995-96 annual report of the crown corporation tabled in the House of Commons June 19, the Regina-based organization increased its business base last year to $4.1 billion, an increase of $600 million in the value of loans receivable over the previous year.
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In a statement released with the annual report, FCC president Gerry Penney said farm prosperity generated by high prices also brought an increase in farm borrowing for expansion. “The entrepreneurial spirit is alive and well in farming communities.”
Expanded mandate
A change in the FCC mandate in 1993 to allow it to loan to farmer-controlled agribusinesses also added to the corporation’s business.
The report noted the corporation is asking government for a further expansion of mandate this autumn to allow lending to businesses that serve rural areas, whether controlled by farmers or not.
Agriculture minister Ralph Goodale has indicated his support for the proposal despite opposition from banker and credit union lobbies. They argue it would make the crown lender an unfair competitor in commercial markets.
According to the FCC annual report, it approved 10,193 loans last year, compared to 6,428 the previous year.
The value of approved loans exceeded $1 billion, compared to $632 million in 1994-95.
The FCC is the largest farm lender in the country with more than 60,000 accounts and 770 employees.
