National Rural Utilities Cooperative Finance Corporation 5.5% SUB NT 64 (NRUC) Q4 2025 Earnings Call Transcript

Loans to members Increased by $2.5 billion or 7% year-over-year, from $34.5 billion at May 31, 2024, to $37.1 billion at May 31, 2025. This growth is the largest year-over-year increase in the electric loan portfolio in CFC's history, driven by strong loan demand from members.

Nonperforming loans Decreased from 0.14% of total loans outstanding at May 31, 2024, to 0.07% at May 31, 2025. This reflects the high credit quality of the loan portfolio and the absence of new delinquencies or charge-offs.

Members' equity Increased by $196 million or 8% year-over-year, reaching nearly $2.6 billion at fiscal year-end 2025. This growth was driven by adjusted net income of $245 million, partially offset by $47 million in retirement of Patronage Capital.

Adjusted net income Decreased by $44 million or 15% year-over-year, to $245 million in fiscal year 2025. The decline was due to a $21 million decrease in adjusted net interest income, a $21 million increase in operating expenses, and a $5 million decrease in investment portfolio gains, partially offset by a $3 million increase in the benefit for credit losses.

Adjusted net interest yield Decreased by 11 basis points or 10% year-over-year, from 1.11% in fiscal year 2024 to 1% in fiscal year 2025. This was a contributing factor to the decline in adjusted net income.

Allowance for credit losses Decreased by $8 million, from $49 million at May 31, 2024, to $41 million at May 31, 2025. This reduction was due to a decrease in the asset-specific allowance on a nonperforming loan.

Total assets Increased by $2.1 billion or 6% year-over-year, reaching approximately $38.3 billion at May 31, 2025. This growth was primarily driven by an increase in loans to electric borrowers.

Total liabilities Increased by $2.1 billion or 6% year-over-year, to $35.2 billion at May 31, 2025. This increase was due to the issuance of debt to fund loan growth.

Debt-to-equity ratio Increased from 7.27:1 at May 31, 2024, to 7.39:1 at May 31, 2025. The increase was primarily due to the rise in total debt outstanding to fund loan growth.

Short-term borrowings Increased by $750 million year-over-year, to $5.1 billion at May 31, 2025. This was driven by a $1.7 billion increase in dealer commercial paper, partially offset by a $500 million repayment under the Farmer Mac revolving purchase agreement and a $443 million decrease in member short-term investments.