FORT WORTH, Texas — Lone Star Ag Credit is distributing a total of $22 million in patronage dividends to its customer-owners, based on its strong financial results for 2020.
The cash patronage payment is a record for the rural lending cooperative.
“As a cooperative, we are committed to returning surplus earnings to our customer-owners,” said Joe Hayman, Lone Star Ag Credit chief executive officer. “While 2020 was a challenging year in many respects, the Association had a tremendous year financially, and we’re thankful to be able to return nearly two-thirds of our 2020 net income in cash to our customers.”
Patronage dividend checks totaling $15 million will be mailed to eligible customer-owners in March. Last fall, the lending co-op distributed an advance patronage of $7 million, for a total $22 million patronage on 2020 earnings.
“This patronage distribution effectively reduces our customer-owners’ interest payments for 2020 by an average of 1.5 percentage points,” said David Harris, Lone Star Ag Credit chairman of the board. “We sincerely hope these cash dividends will provide needed support to those borrowers who’ve been impacted by COVID-19 and the severe weather we’ve all experienced this month.”
At the end of each year, the Lone Star Ag Credit board determines how much income is required for capital needs. Then it distributes the remainder as patronage dividends to owner-customers, as determined by their loan balance during the prior year.
Lone Star has distributed $163.5 million in patronage dividends to borrowers over the past two decades.
With approximately $2 billion in assets, Lone Star Ag Credit provides financing for rural land, country homes, agribusinesses, livestock, agricultural equipment and operating expenses. The rural lender is headquartered in Fort Worth and has credit offices in Abilene, Cleburne, Corsicana, Denton, Fort Worth, Georgetown, Hillsboro, Lampasas, Mount Pleasant, New Boston, Paris, Sherman, Stephenville, Sweetwater, Waco and Weatherford.
For more information, contact a local Lone Star branch office or visit LoneStarAgCredit.com.
Financial results discussed here are preliminary and unaudited. Please visit our website this spring to see our complete results.