More than 6,300 jobs added by farm banks in rural America since 2007, according to ABA study
The banking industry continues to be the major source of agricultural credit, providing more than half of all outstanding farm loans, according to the American Bankers Association's annual Farm Bank Performance Report.
The nation's 2,185 farm banks increased farm and ranch lending $3.8 billion or 5.6 percent in 2011, for a total outstanding balance of $72.3 billion. "The growth in farm loans shows banks continue to meet the credit needs of both large and small farms and remain the most important supplier of agricultural credit," said John Blanchfield, senior vice president and director of ABA's Center for Agricultural & Rural Banking.
Farm banks added 6,327 jobs in rural America since 2007, a 7.8 percent increase, and employed a total of 86,984 men and women at the end of 2011.
"Farm banks posted solid performance in 2011, reflecting the overall strength of the agricultural economy," said Blanchfield. Pre-tax income rose 25.3 percent, the second consecutive annual increase, while equity capital increased 10.9 percent to $40.4 billion and asset quality continued to improve.
"As vital, tax-paying members of their communities, farm banks continue to provide opportunities for rural Americans to finance farms, ranches, businesses and homes, while adding jobs and supporting the agricultural economy," said Blanchfield.
New this year, the Farm Bank Performance Report now provides regional summaries:
- The Northeast region (264 banks) increased farm loans 6.5 percent and employment by 2.0 percent.
- The South region (585 banks) reported improved profitability and employed over 22,000 men and women.
- The Cornbelt region (641 banks) increased farm loans by 6.6 percent and employment by 2.9 percent.
- The Plains region (491 banks) increased return on equity by 50 basis points and employed over 20,000 men and women.
- The West region (196 banks) noted a 2.2 percent increase in jobs along with improved capital and profitability.
Read the 2011 Farm Bank Performance Report on aba.com (http://www.aba.com/aba/documents/communications/FarmBankReport2011.pdf ).
Watch a video summary of the report by John Blanchfield on ABA's YouTube channel (http://www.youtube.com/watch?v=5Anl03UEn_Q).
"Farm banks" are defined by ABA as FDIC-insured banks whose ratio of domestic farm loans to total domestic loans is greater than or equal to 14.61 percent in 2011. While previous reports were limited to banks under $1 billion in assets, institutions over this threshold are now included as they are important providers of credit to farmers and ranchers and are growing in number.
The American Bankers Association represents banks of all sizes and charters and is the voice for the nation's $13 trillion banking industry and its two million employees. The majority of ABA's members are banks with less than $185 million in assets. Learn more at aba.com.