U.S. farm banks increased agricultural lending by nearly 6 percent, or $5.9 billion, to $106 billion in 2017, according to the American Bankers Association’s annual Farm Bank Performance Report. At the same time, asset quality remained healthy at the nation’s 1,847 farm banks as non-performing loans fell to a pre-recession level of 0.52 percent of total loans. ABA defines farm banks as banks whose ratio of domestic farm loans to total domestic loans is greater than or equal to the industry average. Brittany Kleinpaste, ABA’s vice president for economic policy and research, said the increase in lending was an indication of the weaker ag sector, but she said farm banks are still strong and ready to assist their farm and ranch customers. “Banks continue to meet the credit needs of both large and small farms, and remain the largest supplier of agricultural credit in the U.S.,” she said. More than 96 percent of farm banks were profitable in 2017, with more than 55 percent reporting an increase in earnings, the report found.
