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CoBank to disburse $96M to eligible borrowers

The board of Greenwood Village, Colo.-based CoBank ACB approved a special, one-time patronage cash distribution of $96 million as part of a plan to share the benefits of federal tax reform legislation with eligible customer-owners, along with earnings from significant nonrecurring items in 2018.

The cash distribution will be made in September and is incremental to standard patronage payments that the bank makes each year in March.

CoBank, which pays federal and state taxes on income earned from lending to cooperatives and other direct borrowers, saw its effective tax rate lowered by about one-third.

Savings from the tax law, according to Tom Halverson, CoBank's president and CEO, will also be used to fund new or accelerated investments in a number of important functional areas across the bank, including risk management, information technology, data management, digital business solutions and corporate social responsibility.