The American Bankers Association today released its annual Farm Bank Performance Report highlighting the critical role farm banks played in supporting U.S. agriculture in 2024. Despite continued challenges from global uncertainty and lingering supply chain disruptions, farm banks posted solid financial performance, improved asset quality and increased lending to America’s farmers and ranchers.
The U.S. banking industry remained the single largest provider of agricultural credit, holding $205 billion in farm loans by the end of 2024—accounting for nearly 38% of total farm lending nationwide. Of that, farm banks – defined as banks with a ratio of domestic farm loans to total domestic loans that is greater than or equal to the industry average – held $115 billion, with a strong focus on small and microloans critical to rural producers.
“Farm banks continue to be a cornerstone of rural America’s financial well-being,” said Ed Elfmann, ABA’s senior vice president of agricultural and rural banking policy. “In 2024, these institutions demonstrated the strength and resiliency that comes from deep community roots, prudent capital management and a steadfast commitment to America’s farmers and ranchers.”
The report – an analysis by ABA’s economic research team based on FDIC and USDA data – examines the performance of the nation’s 1,398 farm banks.
Key Highlights from the 2024 Farm Bank Performance Report:
- Lending Growth: Farm banks extended $115.1 billion in agricultural loans in 2024, up 6.4% from 2023. Farmland-secured lending rose 4.7% to $65.9 billion; agricultural production loans surged 8.9% to $49.3 billion.
- Credit to Small Farmers: Banks reported over 1.1 million small farm loans worth $72 billion; farm banks held 63.4% of all small farm loans by value, including $9.1 billion in microloans (loans with origination value less than $100,000).
- Asset Quality: Loan delinquency rates at farm banks remained low, with non-current agricultural loans dropping to 0.32%.
- Capital Strength: Equity capital grew 8.1% to $49.6 billion. Tier 1 capital rose 6.7% to $55.7 billion.
- Employment Growth: Farm banks added 576 jobs in 2024, employing more than 74,000 rural Americans.
- Profitability: A strong 97.1% of farm banks were profitable in 2024, with over half reporting earnings growth. Net income rose 7.2% year over year to $5.9 billion.
Looking Ahead: Challenges and Cautious Optimism
While USDA forecasts suggest a rebound in farm income in 2025, producers face headwinds including high input costs, export uncertainty from global tariffs and interest rate volatility. Despite these pressures, farm banks remain well-positioned with strong capital reserves and local market knowledge.
“The next 12 months will test agricultural resilience once again,” said Elfmann. “But America’s farm banks are ready, willing, and able to meet the credit needs of producers through any cycle. We’re also hopeful that the recently enacted narrow version of the ACRE Act that was included in the reconciliation bill will allow ag banks to further expand access to credit for farmers and ranchers across the country.”
Regional Highlights: Farm Lending Strong Across the Country
- Northeast: Farm banks in the Northeast grew farm lending by 8.04% to $1.48 billion. Agricultural production loans increased nearly 20%, and farmland loans rose over 7%. Profitability improved modestly, while capital ratios remained solid. The region’s banks employed just over 1,000 individuals.
- South: Southern farm banks expanded lending by 6.89% to $9.95 billion, led by a 10% increase in production loans. While profitability softened slightly, capital levels remained healthy. Employment in the region’s farm banks fell slightly to 9,658.
- Cornbelt: The Cornbelt, home to the largest number of farm banks, saw lending rise 5.07% to $54.5 billion. Production loans climbed nearly 6%, and farmland loans rose by 4.5%. Profitability held steady and employment increased by 427 jobs.
- Plains: Banks in the Plains region posted the strongest lending growth, up 8.54% to $43.8 billion. Production lending increased 12.78%. Profitability and capital remained robust, and employment rose by 378.
- West: Western farm banks grew lending by 2.14% to $5.32 billion. Profitability stayed healthy despite slight equity return declines. Employment rose 1.36% in the region.