Equitable Unit To Pool Loans For Agriculture
WASHINGTON - The insurance industry's leading farm mortgage lender has signed up to pool loans into securities guaranteed by the Federal Agricultural Mortgage Corp.
Equitable Agri-Business Inc. is the fifth agricultural lender to be granted "certified pooler" status by Farmer Mac, as the federally chartered secondary market agency is known.
The new pooler is a unit of the Equitable Life Assurance Society, which has an agricultural mortgage portfolio of $2.1 billion.
As a certified pooler, Equitable Agri-Business is authorized to buy or originate farm loans according to Farmer Mac's specifications, assemble them into pools, and issue securities backed by the loans.
No Securities Guaranteed Yet
Farmer Mac, established in 1987 to boost liquidity for farm lenders, has yet to guarantee any securities under its flagship program, although it began approving poolers in late 1989.
Three poolers - all life insurance company subsidiaries - have been certified since September, raising hopes that a market breakthrough is at hand.
"This development is further evidence of the rapidly growing interest in Farmer Mac among agricultural lenders," said Henry D. Edelman, Farmer Mac's president.
The other poolers are Goldman Sachs Mortgage Co., Manufacturers Hanover Securities Corp., John Hancock Mutual Life Insurance Co., and Prudential Agricultural Credit Inc.
