WASHINGTON - Rural bankers and other Farmer Mac backers got what they wanted Wednesday from the House Agriculture Committee, which unanimously approved a plan to improve the money-losing mortgage securitizer's prospects.
Now their goal is to get the full House and Senate to act on the bill, which gives the Federal Agricultural Mortgage Corp. new powers and temporarily eases capital requirements. Without quick passage the agency may be forced out of business, Farmer Mac officials say.
"The House seems to be clearing the way for noncontroversial votes to be brought up this year, and this appears to qualify as noncontroversial," said Ron Ence, director of legislative affairs for the Independent Bankers Association of America. "The Senate side is going to be a little tougher, because this legislation is included in the farm bill."
Farmer Mac was started in 1988 with the aim of creating a secondary market for long-term farm mortgages. So far, however, it has not been able to generate enough business to turn a profit, and the constant losses have cut its capital in half.