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AgStar Financial Services Posts Solid First Quarter Performance


Mon, May 10th, 2010
Posted in Business Announcements

MANKATO, Minn. (May 10, 2010) - AgStar Financial Services, a value-added financial services company owned by its client-stockholders, reported net earnings for first quarter ending March 31, 2010. The company recorded a solid performance, with net after-tax earnings of $18 million. Last year's same quarter earnings were posted at $9 million. The strong results are primarily due to a reduction in provision expenses and improved economics across the agriculture industry. In addition, net income was positively impacted by AgStar's share of premium refunds offered by the Farm Credit System Insurance Corporation.

"As anticipated, the economics and balance sheets in the grain industry remain strong. Ethanol remains profitable and the dynamics of the swine industry have improved over the past several months," stated Paul DeBriyn, President and CEO of AgStar Financial Services. "However, we continued to see challenges in the dairy industry during the first quarter as our dairy producers have been plagued by low milk prices."

AgStar's gains from core operations also remain strong and are reported at $22.8 million. Net interest income is nearly 7% ahead of last year's pace through the first quarter. In addition, company revenues were boosted by solid loan fee income, crop insurance commissions, and tax service revenue.

"Serving our valued clients and stockholders remains our top priority," said DeBriyn. AgStar's client satisfaction and client loyalty results continue to be very strong. "We are committed to providing clients with the industry expertise and unparalleled service they expect from AgStar," stated DeBriyn. The company's capital position is well above regulatory minimums and availability of funding is readily accessible for new loans to support AgStar's core business. "We remain profitable because we have upheld disciplined credit practices and we're proud to have a strong, committed team in place to serve our client-stockholders," noted DeBriyn.

About AgStar:

AgStar Financial Services, ACA, headquartered in Mankato, Minn., employs nearly 600 full-time team members. The company is part of the national Farm Credit System and has a public mission to serve 69 counties in Minnesota and northwest Wisconsin. The company has expertise in the corn, soybean, swine, dairy and bio-energy industries. AgStar has developed successful programs in loans, leases, crop insurance, tax services, accounting, consulting and rural home mortgages. As a value-added financial services cooperative, AgStar allocates patronage dividends to its 13,000 stockholders. Visit www.AgStar.com for more information.

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