2021 Farm Bank Performance Report

Key Findings

• The banking industry is the nation’s most important supplier of credit to agriculture, providing approximately 40% of all farm loans in the U.S.—$179 billion as of December 2021.
• Small loans continue to make up almost half of banks’ farm and ranch lending with $69 billion in small and micro farm and ranch loans on the books at the end of 2021.
• Farm banks originated 538,154 PPP loans worth $14.6 billion in 2021, highlighting a commitment to supporting the local workforce and communities.
• The nation’s 1,553 farm banks recorded strong asset quality and capital levels in 2021 through serving their communities and sticking to traditional banking practices: a focus on the fundamentals of credit, solid underwriting standards and knowledge of the customer’s business.
• Farm banks have deep roots in their communities. The median farm bank will be 111 years old in 2021.
• Farm banks’ asset quality improved in 2021, as consolidation and cash payments aided the paydown of loans by farmers. Noncurrent ag loans as a share of total lending (loans 90 days or more past due or in nonaccrual status) dropped by 46 basis points to 0.71% in 2021.
• As a group, farm banks, remained well-capitalized through 2021, as these banks grew their equity capital – a more conservative form of capital – by $3.2 billion, or 6.5%.
• In 2021, these farm banks increased employment by 2.1%, adding over 1,600 jobs, and employing over 80,000 rural Americans. Since 2010, employment at farm banks has risen 27.7%.
• 98.1% of farm banks were profitable in 2021, with 73.2% reporting an increase in earnings.

The ABA definition of “farm bank” for the purposes of this report has changed over time. In 2012, ABA made the decision to include institutions, previously excluded, with more than $1 billion in assets as these institutions grew in number and importance to our country’s farmers and ranchers. In addition, due to changing reporting requirements, ABA began to include savings and loan associations in the production of this report as data became available.