Farm Cash Management SM
Farm Cash Management (FCM) is a convenient way to earn significant income from cash-on-hand. It combines the high return of a short-term investment account with the convenience of your Farm Credit Midsouth revolving line-of-credit. Farms and other qualifying businesses that experience periods when cash accumulates should find FCM beneficial. Self-funding operations that maintain an open line of credit just for emergencies or special opportunities may also find FCM valuable.
Benefits of FCM:
- Pays a very good interest rate for a liquid investment.
- Earnings are exempt from state and local income taxes.
- The cost of borrowing is reduced because investment earnings both delay and reduce the need to draw on your line-of-credit.
- Provides automatic funds management for maximum convenience and simplicity.
How FCM Works:
Investing in an FCM account is as simple as making a payment on a loan. In fact, you have the same choice of methods: in person, by mail, or electronic. Whenever a payment is greater than the balance in your revolving line-of-credit, FCM automatically invests your surplus in short-term, AgriBank Investment Bonds. Interest accrues on these bonds daily and is added to your investment at month’s end. You have access to your money at all times and can draw on your investment account the same way you would draw on your line-of-credit -- just complete a draft or transfer funds electronically. If you draw out more funds than your investment and earnings total, FCM will automatically access your line-of-credit. This means you’ll delay incurring any interest expense until after all your invested funds and earnings have been used!
About AgriBank and its Investment Bonds:
AgriBank, FCB, is a financial institution that provides various services to Farm Credit Midsouth plus the funds needed to make loans. In the same way that member-borrowers cooperatively own Farm Credit Midsouth, AgriBank is owned by Farm Credit Midsouth and the other associations AgriBank serves.
Most of the funds AgriBank provides are obtained through the Federal Farm Credit Banks Funding Corporation. It sells bonds through brokers on Wall Street. But AgriBank can also issue its own bonds and offer them to the members, employees, and retirees of the associations it serves. Selling these bonds reduces AgriBank’s dependence on the funding corporation and funds that are invested in AgriBank Investment Bonds are used to fund loans made by the associations served by AgriBank.
About Investment Risk:
AgriBank Investment Bonds are backed solely by AgriBank, FCB. They are not insured or guaranteed by any government body or the Farm Credit System. For information on AgriBank, FCB, its assets and financial condition, that describes the 7TH district and provides .PDF files of financial reports click "here".
About Investment Return:
AgriBank Investment Bonds pay very attractive rates and the earnings are not subject to state or local income taxes. Rates vary with changing economic conditions.
