ABA Banking Journal
No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
SUBSCRIBE
ABA Banking Journal
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
No Result
View All Result
No Result
View All Result
ADVERTISEMENT
Home Ag Banking

How to Compete with Farm Credit—and Win

January 5, 2016
Reading Time: 2 mins read

By Brian Nixon

In most circles, the words “knock, knock” are considered a set-up for a mildly amusing bit of humor. In rural America, however, they represent the sound of intense competition, specifically from tax-advantaged Farm Credit System lenders. “They are knocking on doors all the time,” says TJ Wilson, market president for Morrill & Janes Bank and Trust Company, based in Hiawatha, Kan.

How ag and rural banks can respond to Farm Credit System competition was a key focus at the 2015 ABA National Agricultural Bankers Conference in Kansas City, Mo. While ABA and the banking industry and allied groups are highlighting examples of unfair Farm Credit System competition and mission overreach with efforts like ReformFarmCredit.org, ag bankers provided examples of how their institutions are fighting back—and maintaining and growing valuable customer relationships—in the face of a tilted competitive playing field.

One strategy: be flexible and use an array of Farmer Mac products to provide competitive rates and manage risks. (ABA, through its Corporation for American Banking subsidiary, endorses Farmer Mac’s secondary market programs, and members enjoy preferred rates.) David Buman, a former Farmer Mac employee who is now SVP at TS Ag Finance in Treynor, Iowa, provided examples of how his bank, which is new to Farmer Mac, is working with ag borrowers. Key to competing with the FCS is keeping an always-sharpened pencil handy. “Some examples [of loans] you see are real skinny, but we need to get the business,” he says.

Wilson adds that the goal of his ag lending team is “to put the customer into a good product and a good position.” It means staying in front of the customer and being ready to provide the right product and service at the right time, he says.

Keith Knudsen, president of Security Bank of Laurel, Neb., says his bank has built valuable customer relationships by offering free financial analysis to producers in its market area.

Buman’s bank also tries to go the extra mile with its customers by offering loan closings on the farm. “Why do farmers need to come into the bank?” he asks. “Farmers do business with people they know and trust.”

A differentiated product line is also essential, bankers say. Wilson’s current strategy: “I like to lead with fixed-rate products.” Fixed-rate, longer-term ag loans are a product line in which Farmer Mac is seeing growing demand from its primary lenders, says Patrick Kerrigan, Farmer Mac’s director of business development.

Knudsen adds that the role of Farmer Mac is important in terms of ag and rural bankers’ ability to meet customer needs as the size of producers’ operations continues to grow. “Our producers have gotten bigger,” he says. “How do we finance these operators’ credit needs?”

Wilson says that loan demand at his bank remains strong, despite tough competition from FCS lenders. “The better producers are thinking ahead to put themselves in a position to grow,” he notes.

ADVERTISEMENT
Tags: Farm Credit System
ShareTweetPin

Related Posts

Prologue and Predictions: 2021’s Ag Policy Shifts and a Look at the Coming Year

Senate confirms USDA deputy secretary

Ag Banking
June 12, 2025

Stephen Vaden, who served as general counsel to the USDA and received an appointment from the president in 2020 to serve on the U.S. Court of International Trade, is now the deputy secretary of the USDA. The Senate...

ABA, associations: Farm Bill needed amid worsening economic situation in farm country

ABA, state bankers associations urge Senate to include ACRE Act in budget bill

Ag Banking
June 3, 2025

ABA and 52 state bankers associations urged senators to include legislation to expand access to affordable real estate credit in rural areas in a budget package currently under consideration in Congress.

ABA unveils key policy priorities for 2025

Budget bill passed by House includes multiple banking industry priorities

Ag Banking
May 22, 2025

The House narrowly passed a reconciliation budget package with several tax provisions supported by ABA. The legislation next heads to the Senate.

ABA comments on proposal to improve accounting in tax credit structures

House committee advances tax package with ABA priorities

Ag Banking
May 14, 2025

The House Ways and Means Committee voted along party lines to advance a federal budget reconciliation tax package that includes several of ABA's policy priorities

ABA unveils key policy priorities for 2025

ABA announces support for several provisions in budget reconciliation tax package

Ag Banking
May 13, 2025

ABA strongly supports several provisions in the federal budget reconciliation tax package, including language to make permanent the Section 199A pass-through deduction, ABA President and CEO Rob Nichols said.

ABA, associations urge Congress to overturn CFPB credit card late fees rule

Federal budget reconciliation tax package includes ACRE Act, other ABA priorities

Ag Banking
May 12, 2025

Congressional leaders unveiled a federal budget reconciliation tax package that contains several banking industry priorities, including language to expand access to affordable real estate credit in rural areas, as championed by ABA.

NEWSBYTES

ABA, associations urge CFPB to rescind changes to adjudication process

June 13, 2025

ABA DataBank: May inflation cooler than expected, but still above Fed’s 2% target

June 13, 2025

Consumer sentiment rebounds in June

June 13, 2025

SPONSORED CONTENT

AI Compliance and Regulation: What Financial Institutions Need to Know

Unlocking Deposit Growth: How Financial Institutions Can Activate Data for Precision Cross-Sell

June 1, 2025
Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

April 25, 2025
Outsourcing: Getting to Go/No-Go

Outsourcing: Getting to Go/No-Go

April 5, 2025
Six Payments Trends Driving the Future of Transactions

Six Payments Trends Driving the Future of Transactions

March 15, 2025

PODCASTS

Podcast: Old National’s Jim Ryan on the things that really matter

June 12, 2025

Podcast: What bankers need to know about ‘First Amendment audits’

June 5, 2025

Podcast: Accelerating banking for quick-service restaurants

May 8, 2025
ADVERTISEMENT

American Bankers Association
1333 New Hampshire Ave NW
Washington, DC 20036
1-800-BANKERS (800-226-5377)
www.aba.com
About ABA
Privacy Policy
Contact ABA

ABA Banking Journal
About ABA Banking Journal
Media Kit
Advertising
Subscribe

© 2025 American Bankers Association. All rights reserved.

No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive

© 2025 American Bankers Association. All rights reserved.