Northwest Farm Credit Services, the big Spokane-based agricultural lender and crop insurance provider, has reported record net income of $159.2 million for 2011, up from earnings of $150.1 million the previous year.

Additionally, the association's total capital climbed 7.4 percent to $1.4 billion.

Phil DiPofi, its president and CEO, attributed the increases in 2011 mostly to continued strong agricultural business activity and timely loan repayments by customers. It also saw credit quality improvements and a reduction in loan charge-off activity.

"Agriculture in general experienced a record income year with strong commodity prices and good growing conditions," DiPofi says in a press release. "These dynamics have strengthened producers' financial positions, which enhances their abilities to grow their businesses and deal with the inevitable down cycles of agriculture."

He adds, "Our customers continue to be cautious about making new investments due to current high input costs and price volatility."

The association's total loan volume remained steady at nearly $10 billion as of Dec. 31, 2011. Loan delinquencies were 1.3 percent, down slightly from the previous year. Nonaccrual loans declined to 2.9 percent of the portfolio, compared with 3.3 percent at the end of 2010.

Northwest Farm Credit provides financing, crop insurance, and related services to farmers, ranchers, agribusinesses, commercial fishermen, timber producers, and rural homeowners in Washington, Idaho, Montana, Oregon, and Alaska.

In January, Northwest Farm Credit announced it was sending out to its stockholders patronage refund checks totaling $53 million, the largest sum in the cooperative's history.

The association has about 12,500 voting stockholders, and a key cooperative principle is returning a portion of net earnings to stockholders based upon their use of the cooperative.

To ensure equitability, it allocates such money, called patronage, based on their eligible annual average loan volume. It distributes most of the cash in January, based on the association's overall financial performance in the previous calendar year.

Northwest Farm Credit leases a 61,400-square-foot office building at 1700 S. Assembly on Sunset Hill, where its headquarters is located, and operates 45 branches in the five states it serves. It employs about 640 people overall, including about 180 at its headquarters. DiPofi said he expects it to add another 25 to 30 employees here this year.